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MINUTES OF THE LONG RANGE FINANCE COMMITTEE
July 6, 2016
ROOM 404
The Long Range Finance Committee meeting was held on Wednesday, July 6, 2016, in Room 404, at Oshkosh City
Hall, 215 Church Avenue.
The meeting was called to order by Tom Pech, Jr. at 5:20 p.m.
Members Present: Harold Buchholz, Tom Pech Jr., Karen Bowen, Jeff Thoms, Matt Lauritch, and Doug
Pearson
Members Absent: Jason Hirschberg, Jeff Herzig and Deb Allison-Aasby
Staff Present: Trena Larson - Finance Director, Lori Burns – Administrative Assistant-Finance
Department, Darryn Burich – Planning Services Manager, Allen Davis – Director of
Community Development
Citizens Present: Jason White – Greater Oshkosh Economic Development Corporation (EDC)
Audra Hoy – Greater Oshkosh EDC
I.
Approval of June 1, 2016 Minutes
One sentence was amended by Audra Hoy. Motion to approve as amended by Chair Pech, seconded by
Buchholz. Approved 6-0.
II.
Citizen Input
None
III.
Discussion
Greater Oshkosh Revolving Loan Fund and Greater Oshkosh Capital Catalyst Fund program
manuals -
(5:25 – 6:00)
Jason White, Chief Executive Officer of Greater Oshkosh Economic Development
Corporation and Audra Hoy updated committee on final changes being purposed in the
Revolving Loan Fund (RLF) manual. Committee discussion included questions and
requests for additional changes within the RLF manual.
Motions made by Chair Pech to approve amended manuals per discussion and proceed to
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forward these to the Common Council for the July 12 meeting. Seconded by Buchholz, all
in favor carried 6-0.
TIF Policy Update –
(6:00 – 6:27)
Davis and Burich presented an overview of the memo prepared by Darryn dated June 29,
2016, and proposed “draft” TIF Policy (see memo and attachments distributed to
members).
Burich – discussed major changes in TIF policy, Criteria #2 page 4, adjusting the “75%”
Rule (75% of the net present value of the TIF generated may be made available to the
project). This 75% was based on a calculation with assumption that the City would incur
debt at a maximum of 20 years and this would provide sufficient increment to cover the
debt payments.
75% rule was set up with up front loans in mind. (e.g. 10 million in value, down to 6
million, now utilizing PAYGO). Paygo funds are provided each year out of increment
based on performance, which is then provided back as an incentive to the property owner.
By lessening annual operating expenses you can have an impact on the IRR (Internal Rate
of Return) for developer. Projects are evaluated based on the IRR of the project. PAYGO
= developers bringing in more equity. Up front loans reduce the amount of equity that has
been brought into the project.
Both methods impact IRR, up front loans are more risky for the city, that is why the change
in preference to paygo. Proposing to change the criteria specific to paygo projects, allow
up to 90% of increment to be used for project support. City doesn’t need to retain so much
cash. Leaving 10% for a cushion for maintenance and administration costs.
Davis – e.g. Oshkosh TIF, ended up at 50%, this lowered the city’s PAYGO obligation
Burich – 20 year payback period now. This was established based on the City’s typical
borrowing periods. Switching to paygo may create a need to extend expenditure period,
again based on a financial analysis, something that would be negotiated in the developer
agreement. Audit every 10 years, look at IRR. If 12% to 15% may need to reset
calculation.
Adjustments to policy criteria, which included adjusting ranking sheet. Current criteria
are focused on job creation, making it harder for redevelopment projects. Proposing to
lower criteria #1, attracting, retaining or expanding businesses for the purpose of
improving the City’s economic base, from 20 points to 15 points. Adding those 5 points to
category #2, projects that directly implement specific recommendations of the City’s
strategic planning documents such as the Comprehensive Plan, Downtown Action Plan,
Riverwalk Plan, Vision Report, Consolidated Plan, Storm water Plans, etc.
Committee consensus is to support these changes which will be forwarded onto the
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Common Council on July 12.
IV.
Select Chair and Vice Chair (Annual Appointments)
Pearson nominated Pech for Chair, seconded by Thoms. Bowen nominated Buchholz for
Vice-Chair, seconded by Thoms. Moved to close seconded by Pearson.
V.
Set August meeting date and agenda items
Meeting set for August 3, 2016, 5:15.
Agenda items:
1) Wheel Tax
2) Update on Strategic Planning
3) Review Updated Collections Report, by Municipality
VI.
Adjournment
Motion by Pearson, Second by Lauritch. Motion passed unanimously.
.m.
Meeting adjourned at 6:40 p