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( This last item does come oack to bother me, especially when I see a $67,000 ending oalance assuming we do not buIld our expansion project in Centervi:le. M I have mentioned In our previous discussions and meetings wittl Rehbein representative$, I ;,ave a strong desire to see this matter settled ralrly for al! parties involved. However, it appears that everyone wants Northern Forest Products to assume the rIsks of the 'what 17$" and uncert;.lnties relating to the fJture. When we left the last meeting with all parties involved, the pian was ic attempt to see if 50mething could be put together to reasonably account for the shortfall in the available tax increment. VlJhat \ see entha table right now is an approximate $57,000 end c:fTlF district balenc& and an offer for a $9300 tax abatemenl It seems that every time Ehlers puts together a new schedule, the ending balance shortfall grows. When you consider the fact tnat my original se!'1edule showed Nortr,ern Forest Products receiving $200, 691.18 of principal and !l'Ite"est over the ii-year life, the fact that a $57,000 balance witl remaIn is pretty s:gnificant. The possibility t!",at this could even grow to be a larger aMount jf class rates go down (witr,out an actual true overall ti!lX rate de,:rease Ie me) makes me wonder hoW much of en incentive there was for Northem Forest Products tc locate in Centerv;Ue I am appreciative of your offer for the one-year tex abatement. If this Is the only option we have to redl..ce the spread between the origInal schedules and the current $chedu~es, it would obviously not make sense for T!1e tc decline this offer. However, due to the fact that such a large amour,t remains, 1 would not be willing to share more than Northern Forest Products' share of the shortfall. ! will not sIgn a~y documents until Rehbein's shere of the exposure r<;>I;;.t1r's ~::: '~"rn," -:f. 1 .Q. it ~ Ie; p>V;!,IUftT"''' .....rl corre~t6d i'i tre D~vment schedules I do not feel that our future expansion plans should be relevant to resolving this !ituaton. I feel that jf we oecide to expand, our expansion should be viewed sel=arately in terms of a comMunity analyzing whether assistance should be provided for ~he expa:1si:Jn. As we hav9 analyzed our need to grow, we have determined recently that rail access could be E significant factor in our ability to be competiti....e in a new product li~e we. have -e.:ently 'nlrtlduced. I have !'\ad discussions w:th a commercial developer irl Hugo regarding land that 1$ availablE! on rail, ar.a Hugo is offering TIF for these lots. My ~eason for t&lllng YOll this is to be ronesl about tMe decis:o!1$ we are facir:g In choosing the best option fo~ OU~ f\.Jtune. My desire is truly to stay in, and grow our busin8$$ln CenterviHe, I would iik.e to propose ar. al~ematilJe solution for you to consider. My propos~1 would eO/'1sist of a tax icatement similsr to wt:at you are offering, but would ,;xtend for 5 years after the TIF district ended, This could be similarly capped at the $25,000 annual amount. and would be contingent on Northern Forest Products adding a minimum of $400.COO of market value sometime before 2002. , feel this would be a good inoentve for LJS to expand in Centerville. as the original TIJ= note would most likely be paid in fUll. AND we would be receiving an ince~tive directly related to our Expansion that would be signifjeent enol,;gh to forego r411l ac::ess. If this could be accomplish~d, I would feel it wouid not be necEssary to assess the Retibein balance for the exposure related to Items # 1 & # 3 above. If we did net expanc in Centerville, tl1e 1-year tax abatement assistance would still be in effect 2 600 III Sl~DaO~d lsa~Od Na3HL~ON \':666 6<:t tS9 l'Yd CG:f:"l (l3:.ft 00/90/60