HomeMy WebLinkAbout34. 12-538
OCTOBER 23, 2012 12-538 RESOLUTION
(CARRIED_______LOST_______LAID OVER___X____WITHDRAWN_______)
Until Receipt of Economic Development Study
PURPOSE: APPROVE TAX INCREMENT FINANCING (TIF) POLICY
AND APPLICATION
INITIATED BY: COMMUNITY DEVELOPMENT
WHEREAS, the City of Oshkosh is active in its use of tax increment financing
(TIF) to promote redevelopment and industrial development activity; and
WHEREAS, no formal TIF policy or application currently exists; and
WHEREAS, adoption of a formal TIF policy and application would better
communicate the City’s expectations to the development community and public
regarding use of TIF; and
WHEREAS, staff reviewed other communities TIF policies and prepared the
attached City of Oshkosh Tax Increment Financing Policy and Application.
NOW, THEREFORE, BE IT RESOLVED that the Common Council of the City of
Oshkosh hereby approves of the attached City of Oshkosh Tax Increment Financing
Policy and Application.
Tax Increment Financing
Policy and Application
What is TIF?
Tax Increment Financing (TIF) is a special funding tool available to local municipalities that spurs
economic development which otherwise would not occur. When a Tax Increment District (TID) is created
property owners within the district continue to pay the same property tax rates as those outside the district.
The difference is that tax collections, over and above the "base value" are placed into a special fund that is
used to pay for project costs. Once all costs incurred by the creation of the TID are recooped by the
additional tax increment created the TID is closed
TIP Closed and the additional property taxes created are shared
by all taxing entities. The use of TIF varies from
project to project and district to district. In some
cases, the City uses TIF to promote redevelopment
TIP Created
of older parts of the community. In other cases the
� ,�
y Tax Increment Created , City uses TIF to create industrial parks through
Used for Project Cosis land acquisition and construction of infrastructure.
In both cases, increased property tax collections are
used to pay down debt service associated with
project costs. The following outlines the City's
Time policy regarding TIF
Purpose:
The purpose of this Policy is to articulate to existing or potential businesses the City of Oshkoslis desire to
promote economic development that is consistent with the City's Comprehensive Plan and provides a
community benefit that will ultimately be shared by all taxing entities (City, School, Technical College,
County, and State) impacted through the establishment of Tax Increment District (TID).
Notwithstanding compliance with any or all of the guidelines herein, the provision of TIF assistance is a
policy choice to be evaluated on a case -by -case basis by the Common Council. The burden of establishing
the public value of TIF shall be placed upon the applicant and the application must substantially meet the
criteria contained herein. City Administration reserves the right to bring any TIP proposal forward for
Council consideration.
Meeting statutory requirements, policy guidelines or other criteria listed herein does not guarantee the
provision of TIF financial assistance nor does the approval or denial of one project set precedent for
approval or denial of another project.
TIF Authority:
The authority and regulations for Tax Incremental Financing and the establishment of Tax Increment
Districts are found in Wis. Stats, 66.1105. The City of Oshkosh reserves the right to be more restrictive than
provided under the statutes.
Tax Increment Financing
Policy and Application
Basic Provisions:
As a matter of policy the City of Oshkosh will consider using Tax Increment Financing to assist private
development in those circumstances where the proposed private project shows a demonstrated financial gap
and that the financial assistance request is the minimum necessary to make the project feasible. The developer
is expected to have exhausted every other financial alternative(s) prior to requesting the use of TIF, including
equity participation, other federal and state funds, bonds, tax credits, loans, etc.
It is the intent of the City to provide the minimum amount of Tax Increment Financing assistance to make the
project viable and not solely to broaden a developer's profit margin on the project. prior to consideration of a
Tax Increment Financing request, the City will undertake (at the requestor's cost) an independent analysis of the
project to ensure the request for assistance is valid.
In requesting TIF assistance, the developer must demonstrate that there will be a substantial and significant
public benefit to the community by eliminating blight, strengthening the economic and employment base of
the City, positively impacting surrounding neighborhoods, increasing property values and the tax base, creating
new and retaining existing jobs, and implementing the Comprehensive Plan.
Each project and location is unique and therefore every proposal shall be evaluated on its individual merit,
including its potential impact on city service levels, its overall contribution to the economy and its consistency
with the Comprehensive Plan, Strategic Plan or other community planning documents. Each project must
demonstrate probability of financial success.
"BUT FOR" TIF
The fundamental principle and that which the City must determine through information provided by the
developer is that the project would not occur "but for" the assistance provided through Tax Increment Financing.
The burden is on the developer to make this case to the City and not the City to make this case for the developer.
Should this "but for" determination not be made, Tax Increment Financing for the project cannot proceed.
TIF Objectives:
The City will consider utilizing Tax Increment Financing to meet the following basic objectives:
1. Stimulate and continued revitalization of the central city and downtown area by:
a. Improving infrastructure;
b. Creating a variety of housing opportunities to increase the number of downtown residents;
c. Preventing or eliminating slums and blighting conditions;
d. Constructing mixed -use developments;
e. Attracting desirable businesses and retaining existing businesses.
f. Encouraging development projects that enhance the streetscape and pedestrian experience and
improve the vitality of the downtown area by adding interest and activity on the first floor of
mixed- use buildings.
2. Promote efficient usage of land through redevelopment of blighted areas.
3. Strengthen the economic base of the City and support Economic Development.
4. Stabilize and upgrade targeted neighborhoods.
5. Create and retain family supporting jobs in the City.
6. Increase property values and tax revenues.
7. Leveraging the maximum amount of non -city funds into a development and back into the community.
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Tax Increment Financing
Policy and Application
What Development is Eligible?
The type of development that the City will consider TIF funding includes:
1. Business development (attraction, retention, expansion). TIF assistance will be evaluated on its
impact on existing local markets.
2. Mixed -use developments that creatively integrate commercial and retail projects into a residential
development.
3. Revitalization of historically significant or deteriorated buildings.
4. Projects that promote central city office and retail development.
5. Projects that promote neighborhood stabilization or revitalization,
6. Projects that promote industrial development.
7. Projects consistent with approved TIF Project Plans.
8. Projects that involve environmental clean -up, removal of slum and blighting conditions.
9. Projects that contribute to the implementation of other public policies, as adopted by the city in its
strategic plans such as promotion of high quality architectural design, energy conservation (i.e.
LEED, Energy Star, etc), green infrastructure, etc.
What Development is Ineligible?
The City will not favor use of TIF funding to help support the following types of development.
1. Speculative office development (projects that have no secured tenants).
2, Relocation of offices, retail and /or commercial uses for purposes other than retaining or
substantially expanding the business.
3. Office and retail development outside of the central city unless part of a city owned business or
industrial park.
4. Stand alone residential development projects unless limited by site and environmental conditions
beyond which make the project financially infeasible.
5. Projects not consistent with the Comprehensive Plan.
3
Basler 'Turbo Conversions is located in
TID #8, South Aviation Park, which was
developed in 1991 and is approximately 256 acres.
The Rivers Assisted Living Facility was
completed in 2011 within TID #21 also
known as the Fox River Corridor Project.
Tax Increment Financing
Policy and Application
Eligible Costs:
TIF eligible expenditures are defined by Section 66.1105(2)(e) of Wisconsin Statutes, which the City of
Oshkosh may further limit on a project by project basis. 'the following are typical eligible costs.
1. Capital costs, including actual costs of,
a. Construction of public works or improvements;
b. Construction of new buildings, structures, and fixtures;
c. Demolition, alteration, rehabilitation, repair or reconstruction of existing buildings,
structures and fixtures, other than historic buildings and structures.
d. Acquisition of equipment to service the district;
e. Restoration of soil or groundwater affected by environmental pollution; and
f. Clearing and grading of land.
2. Real property assembly costs.
3. Professional service costs (planning, architectural, engineering, and legal).
4. Relocation costs.
5. Environmental remediation.
6. Organizational costs (environmental and other studies, publication and notification costs).
Criteria for TIF Assistance:
All of the following financial criteria must be net in order to be considered for TIF assistance.
1. Equity Requirement. Developers must provide a minimum 15% equity of total project costs.
Projects that exceed the 15% equity requirement will be looked upon favorably by the City.
Equity is defined as cash or un- leveraged value in land or prepaid costs attributable to the project.
TIF shall not be used to supplant cash equity.
2.75% Rule. No more than 75% of the net present value of the tax increment generated by a private
development shall be made available to the project.
3. Payback Period. 20 year maximum payback period. Preference will be given to projects with
payback periods of 10 years or under.
4. TIF Cap. The total amount of TIF assistance should not exceed 25% of total project costs. This
limitation may be waived if the project involves redevelopment of existing structures or the
assembly and clearance of land upon which existing structures are located.
5. Self- Supporting Projects. Each project requesting TIF assistance should generate sufficient tax
increment to cover the requested TIF assistance and a portion of any public infrastructure costs
within the district.
a. No increment from other private development projects within the district may be used to
supplement another project's inability to generate sufficient tax increment to cover project
costs.
6. Land Assembly Cap. TIP assistance for land /property assembly costs will not be provided in an
amount exceeding 10% of the fair market value of the land. The fair market value will be
determined by an independent appraiser contracted by the City with cost of appraisal paid for by
developer.
4
Tax Increment Financing
Policy and Application
Criteria for TIP Assistance continued frorn previous page...
7. Internal Rate of Return. The amount of assistance provided to a developer will be limited to the
amount necessary to provide the developer a reasonable rate of return on investment in the project
and the subject site. A developer's return on equity, return on cost or internal rate of return will be
based on current market conditions as determined by the City or City's financial advisor. In no case
shall the internal rate of return exceed 30 %.
8. Taxable Increase. The project should result in an increase in taxable valuation of at least 20% upon
project completion.
Policy Criteria
In addition to meeting all of the above financial criteria, projects must accumulate at least 50 points based on
the following policy criteria:
Criteria
Points
1. Attracting, retaining or expaning businesses for the purpose of improving the City's
economic base.
20
a. Documentation of employment or financial projections must be provided by the party
making the request and will serve as the basis for the agreement.
2. Projects that directly implement specific recommendations of the City's strategic planning
10
documents such as the Comprehensive Plan, Downtown Action Plan, Riverwalk Plan,
Vision Report, Consolidated Plan, Stormwater Plans, etc.
3. Projects involving retail development that is targeted to encourage an inflow of customers from
outside the city that result in exported goods, or that provide services or fill retail markets that
5
are currently unavailable or underserved in the City.
4. Presence of extraordinary development /redevelopment costs such as:
a. Remodeling /Rehabilitation /Demolition
b. Environmental Remediation
20
c. Capital purchases
d. Facility expansion
e. Public infrastructure
5. Proposed employment potential.
a. Number of new employees.
b. Skill and education levels required for the jobs.
c. Range of salary and compensation rates for the jobs as compared with the median
income level for the community.
10
d. Cost of public assistance per job.
e. Potential for executive relocation.
6. Enhance the streetscape and pedestrian experience.
5
7. Historic Preservation. Preservation /rehabilitation of a locally significant historic structure.
5
8. Provides direct benefit to distressed areas through blight elimination.
15
9. Quality of development and overall aesthetics (architectural, site design, landscaping, etc.)
5
beyond that which is minimally required by the Zoning Ordinance.
10. Higher standards of Building Design, Materials, and Energy Efficiency such as meeting
5
LEED certification, Energy Star, etc.
Tax Increment Financing
Policy and Application
Process of TIF Approval:
Tax Increment District creation requires following statutory prescribed timelines that include notification to
the overlying taxing jurisdictions (i.e. public school district, technical college, county, city), property owners
within the district, and published meeting notification in the newspaper. Ultimately the City's Plan
Commission, Common Council, and Joint Review Board all must approve the TIF creation request.
1. A pre - application meeting is held between the developer and the City.
2. A Tax Increment Financing Application is submitted by the developer to the City.
3. The City will review the Application and determine completeness and whether tine proposed
project is eligible under the City's policy and statutory requirements.
4. An analysis of the TIF Plan and financial proformas wilt be conducted by city staff and/or
outside consultants.
5. Within ninety (90) days of receipt of a completed application staff will schedule a public
hearing before the Plan Commission on the Project Plan and District Boundaries. If approved
by the Plan Commission, the Project Plan and recommended boundaries will be sent to the
Common Council for review. There is a minimum 14 day wait from the public hearing to
Council review.
6. The Common Council may approve or deny the proposal to create the Tax Increment District.
The Common Council may also adjust the boundaries (retraction only) of the proposed
district from that which was recommended by the Plan Commission. If approved, the plan is
forwarded to the Joint Review Board to make the final determination that the development will
not proceed "but for" the use of TIE
7. If approved, a Development Agreement is drafted and negotiated between the City and
Developer.
S. Once general agreement has been reached on the terms of the Development Agreement, it will
require approval by the Common Council.
9. Execution of the Development Agreement between the City and Developer.
Structure for Tax Increment Financing Assistance:
1. Tax Increment Financing assistance will be provided by the City on a "pay -go" note method or
via bond proceeds. Requests for up -front financing may be considered on a case -by -case basis
if increment generation is sufficient to meet initial financing and debt service costs and is not
the first dollars spent on a project.
2. For "pay -go' structured projects, the project owner shall agree to pay all other outstanding City
of Oshkosh property tax bills prior to disbursement of any pay -go payments by the City.
3. No Mortgage Guarantees. The City will not provide mortgage guarantees.
4. Personal Guarantee. The City will require a personal guaranty for receiving TIF assistance.
Amount and form shall be acceptable to the City.
5. The property owner shall agree not to protest to the Board of Review or Circuit Court the
Assessor's determination of the property value for the properties for which the grant is requested.
0
Tax Increment Financing
Policy and Application
Structure for Tax Increment Financing Assistance Continued froth previous page...
6. The City will retain a maximum of 10% of any tax increment received from the project to
reimburse for administrative costs. Until such time as the project generates positive tax
increment, the City will charge an administrative fee to the developer to partially offset the cost of
record keeping, report preparation, and accounting.
7. When the project is intended as a for -sale development (i.e., office, retail or residential
condominiums), the developer must retain ownership of the overall project until final completion,
provided, however, that individual condominium units may be sold as they are completed. For
all other projects, the developer must retain ownership of the project at least long enough to
complete it, to stabilize its occupancy, to establish the project management and to initiate payment
of taxes based on the increased project value.
8. Projects receiving assistance will be subject to a "look back" provision. The look back mandates a
developer to provide the City or its financial advisor with evidence of its annualized cumulative
internal rate of return on the investment (IRRI) at specified periods of time after project
completion. The IRRI shall be calculated with equity, revenues, and expenses in accord with
generally accepted accounting principals.
When the developer owns the subject property and rents space to tenants, supporting
documentation shall include certified records of project costs and revenues including lease
agreements and sales on a per square foot basis. If the records indicate that the developer has
received a higher return on equity, a higher return on cost, or a higher internal rate of return than
originally proposed to the City at the time of development agreement, the developer and the City
shall split, on a 50/50 basis, the increase above the originally projected rates of return.
When the subject property is a for -sale development and the IRRI cannot be completed, the
developer is to provide financial data after the project is completed. This shall include a
calculation of profit on total development costs minus the TIF assistance. If the financial records
indicate that the developer has received a higher return on equity, a higher return on cost, or a
higher internal rate of return than originally contemplated at the time of development agreement
approval, the developer and the City shall split, on a 50/50 basis, any increase at or above original
projected rates of return.
Exceptions to TIF Policy. The City reserves the right to amend, modify, or withdraw these policies
or require additional statements or information as deemed necessary. Any party requesting waiver
from the guidelines found herein or on any other forms provided for TIF assistance may do so
on forms provided by the City with the burden being on the requestor to demonstrate that the
exception to these policies is in the best interests of the City.
7
Tax Increment Financing
Policy and Application
Please complete and submit the following information to the City of Oshkosh for a more detailed review of
the feasibility of your request for Tax Incremental Financing (TIF) assistance. The application is comprised
of five parts:
I. Applicant Information
2. Project /Property Information
3. Project Narrative
4. Project Budget /Financial Information
5. Buyer Certification and Acknowledgement.
Where there is not enough space for your response or additional information is requested, please use an
attachment. Use attachments only when necessary and to provide clarifying or additional information.
The Department of Community Development (DCD) reviews all applications for TIF assistance. Failure to
provide all required information in a complete and accurate manner could delay processing of your
application and DCD reserves the right to reject or halt processing the application for incomplete submittals.
For further information please refer to the "City of Oshkosh Tax Increment Financing Policy" document.
Legal Name:
Mailing Address: _
Primary Contact #:
E -mail:
Cell #:
FAX #:
Attorney:
Legal Entity: Individuals) Joint Tenants Tenants in Common Corporation
LLC Partnership Other
If not a Wisconsin corporation /partnership /LLC, state where organized:
Will a new entity be created for ownership? Yes No
Principals of existing or proposed corporation /partnership /LLC and extent of ownership interest,
Name: Address: Title: Interest:
Is any owner, member, stockholder, partner, officer or director of any previously identified entities, or any
member of the immediate family of any such person, an employee of the City of Oshkosh? Yes— No_
If yes, give the name and relationship of the employee:
Have any of the applicants (including the principals of the corporation /partnership /LLC) ever been
charged or convicted of a misdemeanor or felony? Yes No
If yes, please furnish
Tax Increment Financing
Policy and Application
Overall Project Summary and Objectives:
Current and Proposed Uses:
Description of End Users:
Describe any zoning changes that will be needed:
Identify any other approvals, permits or licenses (i.e. Liquor License, Health Department, etc):
Describe briefly what the project will do for the property and neighborhood:
Q
Tax Increment Financing
Policy and Application
Project Timetable
Final Plan /Specification Preparation:
Bidding and Contracting:
Firm Financing Approval:
Construction /Rehabilitation:
Landscaping /Site Work:
Occupancy /Lease Up:
Development Team
Developer:
Architect:
Surveyor:
Contractor:
Other Members:
Describe Team expertise and experience in developing similar projects:
Other current Team projects in development:
Financial ability of the applicant to complete the project:
Full and part -time jobs to be created by the proposed project including estimated salary;
Professional Studies
Market Studies: Applications for commercial and residential projects must include a comprehensive market
study. The market study must identify target markets, analysis of competition, demographics, market rents,
letters of intent /interest from prospective tenants, or for housing developments, sale prices or rental rates of
comparable properties.
Appraisal: All projects that involve the transfer of land must include a recent appraisal. Projects that include
land as a form of equity or collateral must also submit a recent appraisal. The appraisal must value the property
"as is" and the impact on value must be considered for such items as demolition, environmental remediation,
relocation of utilities, lease buy -outs, and other work necessary to make the site developable. The property
must be valued assuming that the highest and best use is the proposed use.
Date
10
Tax Increment Financing
Policy and Application
Sources and Uses of Funds
identify the sources of funds used to finance the project. Typical sources include equity, lender financing,
mezzanine financing, government financing, other anticipated types of public assistance, and any other types
or methods of financing.
Uses of Funds Amount W $ per SF of Building Area
Land Acquisition:
Demolition:
Environmental Remediation:
Site Clearance and Preparation:
Soft Costs/ Fees:
Soft Cost Contingency:
Hard Construction Costs:
Total Project Costs:
Sources of Funds
% of total project costs
Equity
%
Developer Equity:
$
%
Other Equity:{
) $
Total Equity:
Loans
Rate
Terra
Construction Financing:
$ %
'nos'
%
Permanent Financing:
$ %
yrs.
%
TIF Assistance
$
Other: {
100%
Total Sources of Funds
$
Financing
Terms: YearslInterest
Contact Information
Source Amount
Equity:
Loans 1:
2:
3:
4.
11
Tax Increment Financing
Policy and Application
Detailed Pro Forma (must correspond to line items for Uses of Funds on previous page)
Land Acquisition $
Demolition $
Site Clearance and Preparation
Infrastructure
Utilities /removal
Utilities /relocation $.
Utilities /installation
Hazardous Materials Removal $
Other( $
Total Site Clearance and Preparation
Soft Costs /Fees
Project Management
General Contractor ( %)
Architect /Engineer { %)
Developer Fee { %)
Appraisal
Soil Testing
Market Study
Legal /Accounting
Insurance
Title /Recording /Transfer
Building Permit
Mortgage Fees
Construction Interest
Commissions
Marketing
Real Estate Taxes
Other Taxes
Other {
Other
Sub -total Soft Costs /Fees
Soft Cost Contingency
IV)
Tax Increment Financing
Policy and Application
Pro Forma Income and Expense Schedule
Applicants whose projects involve the rental of commercial, retail, industrial, or living units must submit
project pro formas that identify income and expense projections on an annual basis for a minimum five -year
to a maximum eleven -year period. If you expect a reversion of the asset after a holding period please include
that in your pro forma as well. Please check with city staff to determine the time period needed for the pro
forma. Identify all assumptions (such as absorption, vacancies, debt service, operational costs, etc.) that
serve as the basis for the pro formas. Two sets of pro formas are to be submitted. The first set should show
the project without TIF assistance and the second set with TIF assistance.
For owner- occupied industrial and commercial projects, detailed financial information must be presented
that supports the deed for financial assistance (see below).
Analysis of Financial Need
Each application must include financial analyses that demonstrate the need for TIF assistance. Two
analyses must be submitted: one WITHOUT TIF assistance and one WITH TIF assistance. The applicant
must indicate the minimum return or profit the applicant needs to proceed with the project and rationale for
this minimum return or profit. The analyses will necessarily differ according to the type of project that is be-
ing developed.
Rental Property: For projects involving rental of space by the developer to tenants (tenants include offices,
retail stores, industrial companies, and households), an internal rate of return on equity must be computed
with and without TIF assistance based on the pro forma of income and expense prepared for the Income
and Expense Schedule below. The reversion at the end of the ten -year holding period must be based on the
capitalized I ith year net operating income. The reversionary value is then added to the lath year cash flow
before discounting to present value. State all assumptions to the analyses.
For Sale Residential: Show profit as a percent of project cost (minus developer fee and overhead and minus
sales commissions and closing costs, which should be subtracted from gross sales revenue). Other measure
of profitability may be submitted, such as profit as a percent of sales revenue.
Mixed Use Commercial / For -Sale Residential: Provide either separate analyses for each component of the
project or include in the revenue sources for the for -sale portion, the sale value of the commercial component
based on the net operating income of the commercial space at stabilization. Indicate how the sale value was
derived.
Owner - Occupied Commercial: For projects, such as "big -box" retail projects, provide copies of the analyses
that the company needs to meet or exceed the company's minimum investment threshold(s) for proceeding
with the project.
Competitive Projects: In instances where the City is competing with other jurisdictions for the project (e.g.,
corporate headquarters, new manufacturing plant), present detailed analyses that demonstrate the capital
and operating cost differential between the proposed location(s) in Oshkosh and locations that are seriously
being considered by the applicant.
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Revenue Projections - Rental Project
Income rent per sf (or avg.)
Commercial Rent
Commercial Expense Recoveries
Residential Rent
Other Revenue ( )
Gross Potential Income
Year 1 Year 2 >>Year 11
$ $ $
$ $ $
$ $ $
Commercial Vacancy %
$
$
$
Residential Vacancy %
$
$
$
Effective: Gross Income (EGI)
$
$
$
Expenses
Maintenance & Repairs
$
$
$
Real Estate Taxes
$
$
$
Insurance
$
$
$
Management Fee
$
$
$
Professional Fees
$
$
$
Other Expense { )
$
$
$
Other Expense { )
$
$
$
Total Expenses $ $
Net Operating Income (NOT) $ $
Capital Expenses (reserves, tenant iniproveinents, cotntnissions) $ $
Debt Service $ $
Net Cash Flow (before depreciation)
Reversion in Year 10
Year I I NOI before Debt & Capital Expenses
Capitalization Rate
Gross Reversion
$ $
$
$
$
$
$
14
Tax Increment Financing
Policy and Application
Revenue Projects - For -Sale Project
Gross Sales Revenue
Housing Units Unit Type* Number
Total Housing Sales:
*affordable units if any
Housing Unit Upgrades:
Price /Unit
Commercial Space Unit Type Size -sf Price per sf
Total Commercial Sales: $
Total Gross Sales Revenue $
Cost of Sales
Commissions %
Marketing % $
Closing % $
Other Costs ( ) % $
Total Costs of Sales % $
Net Sales Revenue $
15
Tax Increment Financing
Policy and Application
Summary Letter
Provide a summary of the project in the form of a letter addressed to the City Manager. The letter should not
exceed two (2) pages in length and should include only the following essential information about the project:
• Description of site or building
• Current and proposed uses
• Description of end users
• Project start and end dates
• Profitability
• Description of public benefits,
including job creation.
• Overview of private - sector financing
• Amount of TIF assistance requested
• Summary of increment projections
• Name of developer and owner
• Total development costs
• Statement regarding why TIF is essential and why the
"but for" provision will be met.
Note: In the "but for" discussion you must clearly describe why TIF is needed to help this project and
why the project will not /cannot proceed without such support. Failure to clearly provide the
"but for" explanation will delay action on your application.
Project Narrative
Provide an in -depth overview of the project in narrative format. The narrative must include a description of
the following aspects of the project:
• Current condition of the site and historical overview that includes the size and condition of
any existing structures, environmental conditions, and past uses of the site.
• Proposed use(s) of project (e.g. industrial, commercial, retail, office, residential for sale or
for rental, senior housing, etc.)
• Construction information about the project including: size of any existing structure to be
demolished or rehabbed; size of any new construction; types of construction materials
(structural and finish); delineation of square foot allocation by use; total number and individual
square footage of residential units: type of residential units (e.g. for -sale, rental, condominium,
single - family, etc); number of affordable residential units; number and type of parking spaces;
and construction phasing.
• If in an existing TID or redevelopment area, confirm that this project is consistent with the goals and
objectives in the Project or Redevelopment Plan.
• A summary of the proposed "green" features to be included in the project. All projects that receive
TIF assistance are encouraged to include environmentally friendly features.
16
Tax Increment Financing
R"olicy and Application
Filing Requirements
You must provide all of the following items with your signed application:
1. Fee: An application fee of 1% of the requested TIF assistance or $10,000, whichever is greater. This
fee is to cover City costs associated with evaluating the TIF application and does not cover the
use of outside consultants, which if required will be paid for by the applicant. Make your
check payable to the City of Oshkosh.
2. Site Maps: Provide a map that shows the location of the site. Also provide a map that focuses on
the project and its immediate surroundings. Both maps should be no larger than
11x17 inches. Larger maps will be required for projects presented to the Plan
Commission, Redevelopment Authority, or Common Council.
3. Project Renderings: Provide preliminary architectural drawings, plans and renderings for the
project. These drawings should be no larger than 11x17 inches. Larger maps will be required
for projects presented to the Plan Commission, Redevelopment Authority, or Common
Council.
Notes
• The City charges an administrative fee of 5% of the annual tax increment revenue.
• If the project requires planning and zoning approvals, you must make these applications concurrent
with this request.
Agreement
I, by signing this application, agree to the following:
I. I have read and will abide by all the requirements of the City for tax increment financing.
2. The information submitted is correct.
3.1 agree to pay all costs involved in the legal and fiscal review of this project. These costs may
include, but not be limited to, bond counsel, outside legal assistance, and outside financial
assistance, and all costs involved in the issuance of the bonds or loans to finance the project.
4.1 understand that the City reserves the right to deny final approval, regardless of preliminary
approval or the degree of construction completed before application for final approval.
5. The undersigned authorizes the City of Oshkosh to check credit references and verify financial and
other information.
6. The undersigned also agrees to provide any additional information as maybe requested by the City
after filing of this application.
Applicant Name D
17
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ON THE WATER
TO: Honorable Mayor and Members of the Common Council
FROM: Darryn Burich
Director of Planning Services
DATE: October 18, 2012
RE: Approve TIF Policy and Application
BACKGROUND
The City has been very active in its use of tax increment financing to promote redevelopment
and industrial development activity that has resulted in the creation of 25 TID's since the TID
law passage in 1975. The City currently has 19 open TID's with many of these TID's
containing areas of potential development.
The'City has never had any formal TIF policy but receives numerous inquires about the
potential use of TIF for various development projects. Lack of a policy creates some
uncertainty within the development community and at times some unrealistic expectations
regarding the City's participation in a project through TIF.
Staff has developed a TIF policy and application that will be used as a starting point for any
future negotiations involving use of TIF or creation of TID. In development of a policy and
application, staff researched many other communities to develop the policy and application
as proposed.
ANALYSIS
The policy establishes the basic parameters for how the City will utilize its TIF financing
mechanisms requiring such things as minimum equity requirements and maximum returns on
investment. The policy discusses eligible and ineligible development and costs. The policy
also establishes a scoring system and minimum threshold that a request must meet in order
to be considered for TIF. The policy also includes provisions about handling exceptions to
the policy which requires Council approval.
The application sets forth the requirements for information that must provided in order to be
considered for TIF. Items such a proforma (with and without TIF), appraisals, market study,
development plans, etc. must be provided and will be included as part of the application
package. Due to the large amount of staff time that goes into development of a TID plan, a
minimum $10,000 fee is being proposed to offset some these staff costs, which may be
included in an overall development budget should the project proceed.
The proposed policy and application were used in draft form for the recent TID # 25 City
Center Hotel Rehabilitation and not found to have any significant issues requiring major
alteration of the policy or guidelines as proposed.
FISCAL IMPACT
None anticipated.
RECOMMENDATION
Staff recommends approval of the TIF policy and application as proposed.
Approved,
City Manager