2024-06-12 CC Packet - Laserfiche WebLink

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Centerville TIF 1-8 June 5, 2024 Page 2 parking will not occur solely through private investment within the reasonably foreseeable future. Northland finds that it is reasonable for the City to consider TIF assistance as necessary so that development by private enterprise will occur. The City has worked with the Developer to ensure the Development design will be consistent with the City’s overall development objectives for the City as a whole, in addition to the growth in tax base and increased economic activity the Development will provide. Terms of Assistance The Developer is seeking TIF from the city in the form of pay-go TIF assistance. With “pay-go” TIF assistance, pursuant to terms that will be included within a TIF Assistance Agreement (the “Agreement”), the Developer will pay the up-front development costs. As tax increment is received by the City, the Developer will then be reimbursed for TIF-eligible costs up to the lesser of agreed to reimbursement amount or costs substantiated by the Developer, pursuant to the Agreement. The terms of the assistance, as proposed by the City, are limited in the dollar amount and the number of years (not to exceed 15 years). The terms for assistance are as follows: The City will issue a TIF “pay-go” revenue note (the “TIF Note”) to reimburse the Developer for up to $2,500,000 of land acquisition and site improvements costs the Developer will incur for the Development, payable with interest at rate of 5.0%. The payments by the City to the Developer will be payable over a period not to exceed 15 years. The total payments over this period, including principal and interest, is estimated at $3,621,656. This is an estimate, the actual amount will vary based on actual taxable market value of the Development, future tax rates for the taxing jurisdictions, among other factors. The first payment to the Developer will be due on August 1, 2028, and the final payment no later than February 1, 2043. The TIF Note, pursuant to terms within the Agreement, will be payable solely from net available semi-annual tax increments. Net available semi-annual tax increments shall mean 95% of the tax increment from the Development. The TIF Note shall bear simple, non-compounding interest from the date the TIF Note is issued to the Developer, pursuant to the Agreement. Tax increment available after payments on the TIF Note (the “TIF Retained by City”) is estimated at $928,524 (future value). The City may use TIF Retained by City to pay administrative costs to administer the TIF District and to reimburse the City for qualified public development costs within Development District No. 1, all pursuant to the plan for the TIF District, terms of pooling limitations in the statutes that govern the use of TIF, and pursuant to City actions. The boundaries of Development District No. 1 are coterminous with the boundaries of the City of Centerville. Qualified public development costs may include certain public improvements, including construction of street and intersection improvements. TIF Retained by the City is calculated at 5% of the tax increment from the TIF District while the TIF Note is outstanding and then 100% of the tax increment from the TIF District for the remaining duration of the TIF District after the TIF Note is paid.