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23. 17-243
MAY 9, 2017 17-243 RESOLUTION (CARRIED 7-0 LOST LAID OVER WITHDRAWN ) PURPOSE: APPROVE DEVELOPMENT AGREEMENT WITH DISCOVERY PROPERTIES LLC; APPROVE LEASE AGREEMENT WITH DISCOVERY PROPERTIES LLC, APPROVE CONSTRUCTION STAGING LICENSE AGREEMENT; APPROVE SALE OF A PORTION OF THE STATE STREET PARKING LOT; GRANT ACCESS EASEMENT TO HARRY & PRISCILLA KIECKHAFER- 105 WASHINGTON AVENUE AND STATE STREET PARKING LOT INITIATED BY: COMMUNITY DEVELOPMENT WHEREAS, a Development Agreement must be approved by City Council to implement TIF #30 Project Plan, approved by Council on August 23, 2016; and WHEREAS, the City of Oshkosh (City) will remain the owner of the property during environmental remediation activities and construction of new garages and parking lot, requiring the City to enter into a lease agreement for the purpose of facilitating construction and financing of the project during the period prior to completion of the environmental remediation and transfer of the property to Discovery Properties, LLC; and WHEREAS,the lease is consistent with the terms of the Developer Agreement;and WHEREAS, the developer is requesting use of the parking lot area to be retained by the City for construction staging area. NOW, THEREFORE, BE IT RESOLVED by the Common Council of the City of Oshkosh that the proper City officials are hereby authorized and directed to enter into a Developement Agreement with Discovery Properties LLC for rehabilitation of an office building into a 20-unit residential apartment building and construction of new garages on part of the City owned parking lot, south of the Washington building (per the attached map), in substantially the same terms as attached hereto, any changes in the execution MAY 9, 2017 17-243 RESOLUTION CONTD copy being deemed approved by their respective signatures, and to carry out all actions necessary to implement the City's obligations under the Developer Agreement. BE IT FURTHER RESOLVED that the proper City officials are hereby authorized and directed to enter into an appropriate lease with Discovery Properties to permit construction of new garages and reconstruction of a portion of the State Street Parking Lot, in substantially the same terms as attached hereto, any changes in the execution copy being deemed approved by their respective signatures, and to carry out all actions necessary to implement the City's obligations under the Lease Agreement. BE IT FURTHER RESOLVED that the proper City officials are hereby authorized and directed to enter into a Construction Staging License Agreement to permit Discovery Properties to use that portion of the State Street Parking Lot to be retained by the City as a construction staging area, in substantially the same terms as attached hereto, any changes in the execution copy being deemed approved by their respective signatures, and to carry out all actions necessary to implement the City's obligations under the License Agreement. BE IT FURTHER RESOLVED by the Common Council of the City of Oshkosh that the proper City officials are hereby authorized and directed to execute any and all documents necessary to consummate the disposition of a portion of the State Street parking lot (per the attached map) to Discovery Properties LLC or affiliated entities upon reconstruction of the parking lot, construction of the garages, completion of environmental remediation and receipt by the City of a Certificate of Completion from the Wisconsin Department of Natural Resources. BE IT FURTHER RESOLVED by the Common Council of the City of Oshkosh that the proper City officials hereby grant an access easement off Waugoo Avenue to Harry and Priscilla Kieckhafer within the State Street Parking Lot to allow access to parking spaces behind their building at 300 State Street, per the attached, and the proper City officials are hereby authorized and directed to execute any and all documents necessary for purposes of same, any changes in the execution copy being deemed approved by their respective signatures, TO: Honorable Mayor and Members of the Common Council FROM: Allen Davis, Community Development Director DATE: May 4, 2017 RE: Approve Development Agreement with Discovery Properties LLC; Approve Lease Agreement with Discovery Properties LLC; Approve Construction Staging License Agreement; Grant Access Easement To Harry & Priscilla Kieckhafer; Approve Land Disposition -Portion of State Street Parking Lot BACKGROUND Owner/developers Mike Goudreau and Randy Schmiedel (dba Discovery Properties LLC) have requested tax incremental financing assistance (TIF) to assist with the adaptive reuse of the historic Washington Building located at 105 Washington Ave. The project entails significant rehabilitation of the 29,100 square foot office building into a 20 -unit residential apartment building on all floors, and construction of new garages on part of the City -owned parking lot to the south of the Washington building. The other part of the request involves granting a cross access easement behind the commercial building at 300 State Street to permit the parking spaces behind the building to continue to access the former parking lot via Waugoo Avenue. The anticipated project cost is $3.8 million with TIF and State and Federal Historic Tax Credits being requested to offset overall project costs making the rehabilitation financially feasible. The City Council approved the TID #30 creation on August 23, 2016. The proposed Pay -go TIF assistance would be provided over the life of the 27 year district that helps support the internal rate of return for the project that takes it from a -15.15% Internal Rate of Return (IRR) without TIF to a -11.05% IRR with TIF. TID #30 has been approved by the Plan Commission, Common Council, and Joint Review Board and now in order to implement the Project Plan, a Development Agreement must be approved by Council. Attached to this memorandum is a copy of the draft Development Agreement for Council's review. Also attached is the original financial analysis for the project that served as the basis for development of the TIF Project Plan and this Development Agreement. City Hall, 215 Church Avenue P.O. Box 1130 Oshkosh, WI 54903-1130 920.236.5000 http://www.ci.oshkosh.wi.us The developer proposes to acquire 25,351 square feet of the State Street parking lot with the city retaining 6,727 square feet for public parking. With the proposed disposition, the developer will be able to create 30 garage spaces and 11 surface stalls adjacent to the building with access provided via Waugoo Avenue. The city is proposing to retain 20 public parking stalls that will be accessed via State Street as the lot will be separated from the adjacent private lot. A parking demand analysis of the State Street parking lot determined that there were an average of 10 cars parking in the lot on a daily basis and retaining land for 20 spots would be adequate to support future parking demand. One significant development since the approval of TID #30 is the discovery of contamination under the section of the City's parking lot that is proposed to be sold to the developers. It appears that old auto service station fuel and/or oil tank(s) have leaked. This contamination could remain if the City was not selling the lot. However, in this case, the developers have asked for a Voluntary Party Liability Exemption (VPLE) through the Wisconsin Department of Natural Resources for the environmental clean-up and cap, as the city has done in the Marion Road property transactions. The environmental remediation has added an additional $100,000 in project costs that the developers will have to pay. The Lease Agreement is standard since the parking lot property will not transfer until construction is complete and the WisDNR has issued a Certificate of Completion for the remediation and cap. The Construction Staging License is for the developer's use of the remaining City parking lot for construction staging for their garage construction and parking lot redevelopment. ANALYSIS The proposed Development Agreement is based on the previously -approved Beach Building Development Agreement. Pay -go TIF assistance is being requested over the life of the district whereby 90% of the tax increment generated by the development will be returned to the developer as an incentive to make the project financially feasible. The developer's original TIF application was proposing 75% which equated to about $471,858. In all pay -go cases, the financial incentive will only be paid if tax increment is created and after all property taxes and other special charges and/or assessments have been paid. The following is a summary of the main points of the proposed agreement: • The developer will renovate the historic Washington Building structure into 20 apartments, remediate the contamination under the parking lot, and construct garages on the site to serve the Washington apartments by December 31, 2017. • The developer will invest at least $3,889,000 in the project. City Hall, 215 Church Avenue P.O. Box 1130 Oshkosh, WI 54903-1130 920.236.5000 http://www.ci.oshkosh.wi.us • The developer will pay the City $35,000 for the parking lot. This is less that the $66,000 proposed in their TIF application. The developer is paying $31,000 less for the lot because they are incurring an additional $100,000 to remediate the contamination on the site they are purchasing from the City. The City was originally going to reconstruct the parking lot with the $66,000. The City plans to use the $35,000 to mill and overlay the City's share of the parking lot. Due to the project costs and financial projections, the developers asked to reduce their original purchase price. The mill and overlay will cost the City less, however, the projected life of the mill and overlay will be shorter than the full parking lot reconstruction originally planned. Staff believes that the mill and overlay will serve the parking lot adequately. • The City's contribution would be a maximum of 90% of the generated tax increment during the life of the district. This tax increment is estimated to be $566,000. This is more than the $530,739 estimated in the TIF #30 Project Plan. There is no cap on the since there is a "lookback" provision. • Since the applicant is requesting 90% of the tax increment, a "lookback" clause has been added. This will enable the City, after the 10 year anniversary of project completion, to review the Internal Rate of Return (IRR) to determine if an adjustment is required to the city's annual contribution. The developer is provided the ability to obtain a 15% IRR and if the project IRR comes in at or below 15%, no adjustment will be made to the city's annual contribution. If the project IRR comes in above 15%, the city's contribution will be lowered to the 15% IRR level. In the event the city has already paid the developer more than the approved contribution, the developer shall refund such excess city contribution. Ehlers still estimates that the project IRR will remain about -11% based on the projected revenues and expenses. Approval of the Development Agreement is the mechanism through which the Project Plan for TID No. 30 will be implemented. The other terms and conditions of the Agreement are consistent with other TIF Development Agreements. The Lease Agreement and Construction Staging License are standard and protect the City from any liabilities, including additional contamination, generated during construction. FISCAL IMPACT Approval of the Development Agreement for the Washington Building will have no fiscal impact on the provision of city services relative to the ability to serve the development nor require the expansion of city services to serve the development. The 10% of increment not paid to the developer will be used to pay the City's annual TIF administrative costs and/or costs associated with the William Waters Plaza reconstruction. The City will retain 20 parking stalls within the State Street Parking Lot and sell the remaining portion of the lot for $35,000. The proceeds of the sale will be used to rehabilitate the remaining portion of the City -owned parking lot. The proposed cross access easement will have no fiscal impact on the City. City Hall, 215 Church Avenue P.O. Box 1130 Oshkosh, WI 54903-1130 920.236.5000 http://www.ci.oshkosh.wi.us RECOMMENDATION The City Council approves the draft Development Agreement, Lease Agreement, Construction Staging License Agreement and grant an Access Easement to the Kieckhafer's. Submitted, Allen Davis Community Development Director Approved: Mark A. Rohloff City Manager City Hall, 215 Church Avenue P.O. Box 1130 Oshkosh, WI 54903-1130 920.236.5000 http://www.ci.oshkosh.wi.us DEVELOPMENT AGREEMENT This Development Agreement (the "Agreement") is made this day of April, 2017 (the "Effective Date"), by and among the CITY OF OSHKOSH, WISCONSIN, a Wisconsin municipal corporation, the "City"), and DISCOVERY PROPERTIES, LLC, a Wisconsin Limited Liability Company (the "Developer"). RECITALS A. The City has established Tax Incremental District No. 30 (the "District") as a blighted area district in which at least fifty percent (50%) of the property within the District is a blighted area, as that term is defined by Wis. Stat. Sec. 66.1105(2)(ae), and in which certain costs incurred for redevelopment of the District may be reimbursed from property tax increment as provided by State law; and B. The City created this District to promote redevelopment by assisting in the financing of the costs of certain improvements, development incentives, and other costs associated with the ownership and development of properties located in the District; and C. The Developer owns property, commonly known as 105 Washington Avenue, within the District. The Developer's property is an historical office building that is being converted into approximately 20 residential apartment units. The Developer's overall redevelopment Project includes purchasing part of the adjoining City -owned property that is currently used as a public parking lot to construct new parking facilities to serve the apartments. Both the Developer's property and the City property is collectively referred to as "Property" as defined in this Agreement. The Developer will construct covered parking on the Property to serve the redeveloped residential apartments. The Property is identified and described as Lots 1 and 2 in the Draft Certified Survey Map attached as Exhibit A, which is incorporated into this Agreement; and, D. The Property currently contains certain Hazardous Substances which will need to be remediated before the Developer takes title to the Property. In an effort to comply with environmental regulations and constructing the covered parking on the Property in a manner that will result in an environmentally compliant Property, the Developer will lease the Property from the City pending the completion of environmental remediation work that will result in the issuance of a Certificate of Completion by the Wisconsin Department of Natural Resources. Fee title to the Property will be conveyed to Developer in the manner described in this Agreement; and E. The Developer will invest not less than $3,889,000 in this overall redevelopment Project within the District, and the Project will be undertaken in accordance with applicable City ordinances and City -approved plans; and F. The Developer has indicated that it will not undertake the development of the Project but for its reliance receiving a City Contribution in the form of tax increment financing that may be available from any Available Tax Increment in the future for the purpose of May 4, 2017 assisting with costs allowed by Wisconsin Tax Increment laws including Wis. Stat. Sec. 66.1105, and any other applicable statute and/or regulation; and G. The City is authorized to enter into contracts necessary and convenient to implement the purpose of a Tax Incremental District, including the ability to provide development incentives, cash grants, and/or other City Contributions to owners, lessees, or developers of land located within the District; and H. The Project and the Property uses contemplated by this Agreement are necessary and desirable to serve the interests of the City and its residents by expanding the tax base of the City, providing additional development and employment opportunities, and providing a financing mechanism to expand and acquire necessary infrastructure, all consistent with the purpose of a Tax Incremental District under Section 66.1105, Wisconsin Statutes; and Based upon the Developer's desire to undertake this Project, and upon the City's desire to redevelop the District and to obtain the economic benefits to be generated from the Project and the redevelopment of the Property, the parties are willing to enter into this Agreement. AGREEMENT fN CONSIDERATION of the Recitals and terms and conditions contained in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: 1) DEFINITIONS. For purposes of this Agreement, the following terms shall have the following meanings: a) Administrative Costs means all of the following costs and expenses of the City relating to the District and attributable to the Property: (i) professional services including, but not limited to, planning, engineering, design, accounting, financial planning, and attorneys' fees and costs; and (ii) reasonable charges for time spent by City employees in connection with the implementation of the Project Plan and administration of the District. In lieu of annual calculations of the City's Administrative Costs that may otherwise be deducted from the annual increment, the parties agree that these costs will be included in the percentage of Available Tax Increment as described in this Agreement. As noted in other parts of this Agreement, however, the Developer may incorporate its Administrative Costs into its Project Costs for purposes of determining the City Contribution. b) Agreement means this document and all of its component parts and exhibits. c) Affiliate means any entity majority owned and controlled by, in control of, or under common control with Developer or any entity of which Developer is a subsidiary or which is a shareholder of Developer. An Affiliate includes, but is not limited to, an entity with which Developer merges or into which Developer consolidates, or which acquires all or substantially all of the common stock or assets of the Developer. d) Available Tax Increment means an amount equal to ninety percent (90%) of the annual gross Tax Increment revenues actually received and retained by the City which are 2 May 4, 2017 generated by the Property and improvements and personal property thereon in the immediately preceding calendar year. e) City Contribution means payments provided from the City to the Developer from future Available Tax Increments as set forth in this Agreement. The amount payable to the Developer will be ninety percent (90%) of Available Tax Increment. While the total amount may vary based upon final costs, assessments, increment, and contribution adjustments. However, the parties estimate as of the date this Agreement is executed that the City's contribution to be $566,000.00 over the life of the District. f) District means all of the real property included in Tax Incremental Finance District No. 30 as described in the Project Plan, which includes the Property described in this Agreement. g) Environmental Reports means (i) Phase I Environmental Site Assessment, City of Oshkosh, Parking Lot — Northeast Corner of State Street and Waugoo Avenue, prepared by AECOM, dated September 2016 and (ii) any Phase II Environmental Site Assessment(s) required based upon the findings in any of (i) -- (ii), above. h) Existing Environmental Conditions means any Hazardous Substances, known or unknown, present in concentrations greater than applicable standards on, in, at, or under the Property or migrating in concentrations greater than applicable standards to or from the Property at any time on or before the Effective Date. i) City Lease means that certain Lease dated as of , 2017 by and among the City and Developer pursuant to which Developer will lease the Property from the City for the purpose of commencing construction and environmental remediation actions. j) Hazardous Substances means toxic, hazardous, and/or regulated substances, pollutants, or contaminants, whether present in the soil or groundwater at, under, or migrating from or to the Property. k) Payment Dates means November 1 of each year, commencing on November 1, 2018 and ending upon the payment of the full City Contribution, or the termination of the District, whichever comes first. 1) Payment Term means the term commencing on November 1, 2018 and continuing on the same day of each year thereafter until the first to occur of the following: (i) payment to Developer of the entire amount of the City Contribution, or (ii) November 1, 2044. For example, for illustrative purposes only, if the Effective Date is March 1, 2017, the Payment Term would ran from November 1, 2018, through the first to occur of the following: (i) payment to Developer of the entire amount of the City Contribution; or (ii) November 1, 2044. m) Proiect means the Developer's acquisition, redevelopment, construction and use of the Property, which includes both a parcel previously acquired by the Developer as well as a parcel to be acquired from the City, as an apartment building with approximately 20 units, and an associated parking lot with garages, and related infrastructure and site 3 May 4, 2017 improvements, all of which shall comply with applicable City ordinances and City - approved plans for the Property. n) Project Plan means the information located in the document entitled "Project Plan for the Creation of Tax Incremental Finance District No. 30 in the City of Oshkosh" prepared by Ehlers, Inc. dated July 27, 2016, which is described on Exhibit B, which is attached and incorporated into this Agreement. o) Project Costs means the costs to be invested by the Developer relating to the Project as set forth on Exhibit C, which is attached and incorporated into this Agreement. The Project Costs shall include: (i) parking lot reconstruction; (ii) environmental remediation expenses relating to the Property; (iii) the City Contribution otherwise identified as a Development Incentive as identified in the TID #30 Project Plan; (iv) costs for storm water management facilities located on or serving the Property; (v) renovations to the historical office building for the creation of residential units; and, (vi) Administrative Costs. For clarity, these costs include all capital expenditures (or expenditures that could be treated as capital expenditures) and preliminary expenditures, such as architectural, engineering, surveying, soil testing and similar costs that are incurred in connection with the construction of the project. The City and Developer agree that the Project Costs listed in Exhibit C are estimates only, and that upon completion of the work described on Exhibit C, the parties shall prepare and attach to this Agreement a revised Exhibit C setting forth actual Project Costs. Notwithstanding the foregoing, the cumulative total of Project Costs used to determine the City Contribution shall in no event be less than $3,889,000.00. p) Propertx means the two (2) parcels which will be used for the Project. One of the two parcels is owned by the Developer at the Effective Date and contains the building with apartment units. The second parcel is owned by the City at the Effective Date and will be leased by the Developer before the City conveys this parcel. The two parcels are collectively referred to as the Property, and is described in Exhibit A attached hereto and incorporated herein, together with all improvements and personal property thereon. q) Property Tax Increment Base means the aggregate value, as equalized by the Wisconsin Department of Revenue, of the Property as of January 1, 2016, with the actual, specific value being $440,000.00. r) Restrictive Covenants. Covenants in addition to those normally identified on Warranty Deeds, or in addition to those required by title insurance, which the City will require be placed on the City parcel at the time it is conveyed to the Developer. The two subjects of covenants are the restriction on conveying the property to tax-exempt entities, as well as the restriction requiring that the parcel containing parking facilities to be conveyed by the City be held in the same ownership as the parcel owned by the Developer containing the building with apartment units. s) Tax Increment has the same meaning as defined in Section 66.1105(2)(i) of the Wisconsin Statutes. 4 May 4, 2017 t) Tax Increment Law means Section 66.1105 of the Wisconsin Statutes. 2) CITY'S OBLIGATIONS. a) Lease. The City shall lease to Developer the City parcel which will be incorporated into the overall Property, and upon which the garages and parking lot serving the apartment units will be constructed. The parties' Lease Agreement shall be substantially similar to the Lease Agreement attached hereto as Exhibit F ("City Lease"). The term of the City Lease shall begin on a mutually agreed upon date set forth in the City Lease, and end on the date identified therein, or on the date upon which the City conveys the Property to the Developer as described in this Agreement. b) City Contribution. i) The City will provide future payments to the Developer to assist with Project Costs from future Available Tax Increments, to the extent that such Available Tax Increments exist, and such payments are compliant with this Agreement and all applicable law. These payments, to be known as the City Contribution, shall be payable beginning in 2018, or when such Tax Increments become available for payment, whichever is later. The City Contribution will be equal to ninety percent (90%) of the Tax Increment attributable to the Property, which shall be calculated by subtracting the TIF District base value from the assessed value of the Property as of January 1, 2018 and each year thereafter, and multiplying the result, if positive, by the mill rate for all taxing jurisdictions established for each year. ii) The City Contribution shall be first paid to the Developer on or about November 1, 2019, and each November 1 thereafter to the extent such Tax Increment exists. The City's obligation to make the City Contribution shall end and expire as of the earlier of (i) the termination date of the District, or (ii) the receipt by Developer of the total approved City Contribution. A pro forma City Contribution calculation is attached as Exhibit D and fully incorporated herein. iii) City Contributions shall be solely from Tax Increment attributable to the Project that is actually received by the City. In no event shall the City's payment to the Developer exceed the total tax generated by the Project. The City Contribution shall be a special and limited obligation of the City and not a general obligation debt of the City. The City covenants and agrees, however, not to utilize any Tax Increment received with respect to the Property during any year for any purpose other than payment of the City Contribution, unless and until the City has paid the City Contribution in full for such year. iv) The Developer acknowledges that, as a result of the special and limited nature of the City's obligation to pay the City contribution, the Developers' receipt of the City Contribution depends on various factors including, but not limited to, future mill rates, changes in the assessed value of the Property, failure of the Project to generate Tax Increments at the rate expected by the Developer, changes in the Tax Increment Law, and other failures beyond the City's and/or the Developer's control. 5 May 4, 2017 v) The City shall have no obligation to make the City Contribution to the Developer unless and until the Developer has made all payments owed to the City by the Developer for real estate taxes, personal property taxes, special assessments, and special charges for any property it owns within the City. c) City Contribution Adjustment. The actual City Contribution may be adjusted as described in this section. i) The City Contribution amount is based upon the pro forma ten (10) year Internal Rate of Return ("IRR") submitted by the Developer to the City, a copy of which is attached hereto as Exhibit F. Developer and the City agree that to the extent that the project's performance varies materially from the pro forma IRR., the City Contribution may be adjusted pursuant to this Section. ii) On or before the thirtieth (30`x') day following the tenth (10) anniversary of the Completion Date (the "Test Date"), Developer shall provide the City with copies of all internally prepared financial statements (kept in accordance with generally accepted accounting principles) and a complete annual cash flow update based on actual income and expenses (in a format consistent with the example in Exhibit F) for the Project for the Period from the Completion Date to the Test Date. Within ten (10) business days thereafter, Developer and the City shall, using information from the financial statements and cash flow update, and the methodology utilized to calculate the original Project pro forma IRR (as set forth on Exhibit F) and applying the Approved Assumptions (as defined below) to supply any information that is not known as of the Test Date, calculated the actual IRR as of the Test Date. iii) If the actual IRR calculated on the Test Date as proposed based upon the updated analysis exceeds 15 percent (15%) annual IRR over the Term (the "Approved Contribution"). In the event that the City has already paid Developer more than the Approved Contribution as of the Test Date, Developer shall refund such excess City Contribution to the City within ninety (90) days of the recalculation date. iv) As used herein, the Approved Assumptions shall be the present value of historic tax credits, terminal capitalization rate, lease rates and all other assumptions agreed upon by the Developer and the City as of the date the pro forma IRR is updated, and absent such agreement, as determined by an independent MAI appraiser with not less than ten (10) years' experience appraising commercial and multi -family properties in the Appleton -Oshkosh -Neenah metropolitan statistical area. All costs for the independent appraiser shall be shared equally by the city and the Developer. d) Annual Acknowledgement of City Contribution. The City covenants and agrees as follows: (a) the City Manager or his designated representative shall include the payment of the entire Available Tax Increment for each year included during the Payment Term in the applicable budget request recommendation for the following year's budget, (b) if the City's annual budget does not in any year provide for appropriation of Available Tax Increment sufficient to make a payment due to Developer in that year, the City will use its diligent, good faith efforts to notify the Developer of that fact at least thirty (30) days prior to the 6 May 4, 2017 date the budget is presented to the City Common Council for final approval, and (c) except for Administrative Costs, funds in the special fund of the Property attributable to the Available Tax Increment generated from the Property (and all improvements and personal property thereon) shall not be used to pay any other project costs of the District until the City has applied to the payment due hereunder, in any year, the Available Tax Increments generated by the Property (and all improvements and personal property thereon) that this Agreement provides will be applied to payment due hereunder. e) City Contribution Placed in City Budget. Developer acknowledges that, subject to the provisions of this Agreement: (i) all payments of Available Tax Increment are subject to the future annual appropriation of said amounts by the City Common Council to payment due hereunder; (ii) only the Available Tax Increments generated by the Property (and all improvements and personal property thereon) shall be used to make payments to the Developer; and (iii) if, on November 1, 2042, the amount of the Available Tax Increments to be paid under this Agreement proved insufficient to pay the entire City Grant, the City shall have no further obligation or liability therefor. f) City Contribution Conditions. The payment of the City Contribution shall be subject to the following conditions and limitations: i) On each Payment Date during the Payment Term and subject to the provisions of this Agreement, the City shall pay a portion of the City Contribution equal to the amount of Available Tax Increment appropriated by the City Common Council for the payment due that Payment Term year. ii) The City shall take no action to initiate the termination or dissolution of the District early prior to November 1, 2044, unless the City first pays the outstanding balance of the City Contribution, subject to the provisions of this Agreement, including, but not limited to, the annual appropriation of the City Common Council of such amounts. iii) Attached hereto as Exhibit F is the City's projection of revenues and expenditures for the District over its term, with the City Contribution labeled as "Developer Incentive Payments" thereon. Exhibit F is provided for illustrative purposes only, and Developer acknowledges that the amounts set forth thereon are estimates only. g) City Contribution not to be Considered Indebtedness. In no circumstances shall any amount of the City Contribution to be paid to the Developer as described in this Agreement be considered an indebtedness of the City. The obligation of the City hereunder is limited to the Available Tax Increment which is available and appropriated by the City Common Council for payment of such amounts and only to the extent as provided in this Agreement. Amounts to be paid through this Agreement shall not count against the City's constitutional debt limitation, and no taxes will be levied for its payment or pledged to its payment other than any Tax Increment to be appropriated for that purpose. 3) DEVELOPER'S OBLIGATIONS. a) Development of the Project. Developer shall invest not less than $3,889,000.00 to develop, construct, and use the Project. 7 May 4, 2017 b) Project Construction. Developer shall commence construction of the Project within 30 days following the Effective Date of this Agreement. Once commenced, Developer shall diligently pursue completion of construction of the Project in accordance with applicable City ordinances and City -approved plans for the Property so that in any case construction shall be completed by December 31, 2017. c) Costs and Expenses. The Developer shall be responsible for all costs related to the Project and any other work to be performed on the Property by the Developer under this Agreement, including all engineering, inspections, materials and labor, and all environmental remediation. Developer shall be responsible for payment of all City fees including without limitation impact fees, building permit fees, zoning and sign permit fees, storm water, electrical and plumbing fees. 4) ENVIRONMENTAL MATTERS. a) Existence of Hazardous Substances. The Property currently contains certain environmental contamination that will be remediated at the Developer's expense during the redevelopment of the Property. The City will retain ownership of the Property, subject to Developer's lease, during the redevelopment of the Property. The City will obtain a Voluntary Party Liability Exemption ("VPLE") Certificate of Completion from the WDNR, for the Property before conveying it to the Developer. Although the City as the Property owner will receive the VPLE, such result will occur at Developer's expense and subject to the Developer's remediation efforts during the course of its redevelopment of the Property. The City shall not be responsible for these environmental remediation costs and activities except to the extent that the City Contribution may be indirectly attributable to statutorily authorized reimbursements. The receipt of the VPLE will occur according to WDNR's schedule and will be based upon the Developer's actions on the Property. b) Developer Future Responsibilities. The Developer understands that the final case closure and VPLE Certificate of Completion may include the use of institutional controls. Such institutional controls may include, for example but without limitation, groundwater use restrictions and cap construction and maintenance requirements. After conveyance of the Property, all such institutional controls shall be the sole responsibility of the Developer. The parties understand, for example, that future responsibilities may include routine cap maintenance, repair or replacement obligations a -rising from environmental conditions, as well as potential responsibilities for any active mitigation measures such as continuous groundwater extraction or monitoring, or hazardous gas/vapor mitigation, beyond a passive or ordinary venting system until such time as such measures are no longer required by WDNR. In all cases, the Developer shall be responsible for future oversight and requirements of the WDNR. c) Developer Remediation Efforts. The Developer's responsibility to pay the entire cost of the work necessary to redevelop this Property and to obtain the VPLE Certificate of Completion, includes the cost to investigate and remediate the environmental condition of the Property to the standards required by the WDNR. The City, as the owner of the Property during the course of the redevelopment and environmental remediation of this Property, shall have direct and continuous access to the Property, either directly or through May 4, 2017 contractors or consultants it retains to monitor activities. Although both parties agree to work in good faith to successfully complete all environmental remediation at the Property, the City and its agents or representatives monitoring the environmental remediation, have a superior interest in ensuring that a VPLE Certificate of Completion is obtained in a timely manner, and that WDNR is otherwise accepting of the environmental condition of the Property at the completion of the Property's redevelopment. To that end, while the Developer shall retain flexibility to utilize cost-effective remediation methods approved by the WDNR, the City shall retain the right to provide oversight and recommendations regarding the successful environmental remediation of the Property. d) Developer Indemnification Responsibilities, Beginning on the Effective Date of this Agreement and continuing through the issuance of the VPLE Certificate of Completion, the Developer is responsible for environmental or Hazardous Substance claims, damages, and violations to the extent they are caused or materially exacerbated by the Developer. Developer shall hold the City harmless from such incidents and shall further indemnify the City for all expenses related those issues that are the Developer's responsibility. After the receipt of the VPLE Certificate of Completion, the Developer shall be solely responsible for, any and all claims in any way arising out of, connected with, or resulting from any Hazardous Substances, known or unknown, present on, in, at, or under the Property or migrating to or from the Property at any time after the issuance of the VPLE. Developer shall indemnify, defend, and hold harmless the City, and its successors and assigns, and its officers, directors, employees, contractors, and agents from and against claims or damages occurring after the issuance of the VPLE. 5) CONVEYANCE OF PROPERTY. a) Obligation to Convey. Upon WDNR's issuance of the VPLE Certificate of Completion, and provided the Developer is in compliance with all other material terms of this Agreement, then the City shall convey the Property to the Developer. b) Lease Termination and Conveyance. The parties shall take all reasonable efforts to terminate the City Lease and convey the City's parcel to the Developer as soon as it is practicable after receipt of the VPLE Certificate of Completion. The City will convey the City parcel to Developer for a purchase price of Thirty -Five Thousand and NO/ 100 Dollars ($35,000.00) and other good and valuable consideration via a General Warranty Deed, subject to no liens or encumbrances other than utility easements of record, zoning restrictions, deed or other restrictions imposed by the WDNR in connection with the issuance of the VPLE Certificate of Completion, and other matters disclosed to Developer and its lender(s) pursuant to the title commitment issued for the City's parcel to be conveyed, which is Lot 2 of CSM c) Connection to Adjoining Parcel. The Property conveyed to the Developer must maintain the exact same ownership as the adjoining parcel upon which the historical building which has been redeveloped for residential apartments for this Project is located. In particular, the adjoining property is commonly known as 105 Washington Avenue, and Parcel Number 90200880000. Due to the accommodations the City has made in regards to this Project, it will not be considered compliant with this covenant for the owners of 9 May 4, 2017 the two parcels to be an Affiliate, or related, or similar. The City shall place such restriction and covenant upon the deed conveying the Property. Additionally, this covenant shall survive the termination of the District and this Agreement unless such terms are in writing and explicitly agreed to by the City. d) Title Insurance. The City shall pay all costs of an owners' title insurance policy in the amount of the value of the Property insuring that fee simple title to the property will be vested in Developer. e) New Easement. The Developer is aware of, and accepts that, the City will be entering into an access easement agreement with a separate, adjoining property, that will allow vehicles parked behind that property's building to access the adjoining property through the Property in the form of the attached Exhibit H. f) Existing Storm Water Easement. Notwithstanding other assertions in this Agreement, the Developer is aware of, and accepts that, a storm water Easement over and through the Property which was granted by the City to a third -party on February 2, 1988, and was recorded with the Winnebago County Register of Deeds on February 8, 1988, as Document Number 695777. The terms of the Easement call for the release of the Easement rights upon the City's sale of the Property. The Developer is further aware that the person holding the Easement rights is, at this time, not willing to cooperate in the release of Easement rights. The City has advised the Developer that it will take reasonable steps to ensure that the Easement is released including, but not limited to pursuing a Court action to release the same. However, the City makes no promises, warranties, or covenants regarding the potential release of this Easement and the Developer assumes all risk in the event the City is unsuccessful in its actions to release this Easement. 6) APPROVALS AND DEVELOPMENT STANDARDS. a) Approval of Public Bodies. The Developer shall obtain all approvals and consents necessary for the City to approve the development of the Property, and any other approvals necessary to utilize the Property for the Project. This includes all necessary approvals and consents from the City and all other appropriate governmental departments, divisions, bodies, councils, boards, and parties having a right to control, permit, approve, or consent to the Project and use of the Property. b) Acceptance of Agreement. The act of accepting this Agreement by the City shall not obligate the City to grant any additional approvals, including, but not limited to, permits, variances, exceptions, or conditional use permits, or approve any building or use the City determines not to be in compliance with the applicable municipal codes and ordinances of the City. The City agrees to proceed in good faith in connection with the issuance or grant of all such approvals, consents, permits, certificates, and any other documents as may be necessary or desirable in connection with the development, utilization, and operation of the Property and to act reasonably and expeditiously and in cooperation with the Developer. It is understood and agreed that this provision is not intended to limit the rights of the City. 10 May 4, 2017 c) Development Requirements. The Developer shall use the Property for the approved Project and in accordance with the provisions of this Agreement, and all other applicable federal, state, county, and City laws and regulations. 7) TAX EXEMPT STATUS. a) Importance of Taxable Status. Developer acknowledges that the City is relying solely upon the Property's real estate taxes to generate the Available Tax Increment necessary to fund the City Contribution. b) Maintaining Taxable Status. Throughout the period of time from formation until the termination of the District, neither the Developer, nor Affiliate, related entity, or any successor in interest to the Property will pursue, assist, support, or be involved in any federal, state, or local, judicial, legislative, or regulatory action or process that seeks, directly or indirectly, to prohibit or completely set aside the taxability of all or any portion of the Property on any basis whatsoever. The prohibition to limit taxability shall not include efforts by the Property owner to challenge value of the Property's assessment, as any property owner is otherwise allowed by law. The prohibition regarding tax exempt status shall be continuous during the term of the District, but shall expire upon the termination of the District. c) No Conveyance to Tax Exempt Entity. During the period of time that commences upon the date of this Agreement and terminates at the end of the District, neither the Property, the Project nor any part thereof or interest therein shall be sold, transferred, leased, assigned, gifted, owned, used, or conveyed in any way to any person, partnership, organization, or entity that is all or partially exempt from federal or State of Wisconsin income taxes or real or personal property taxes, without the express prior written consent of the City. The City is under no obligation to consent to the conveyance of the Property to a tax exempt entity and retains sole and absolute discretion to withhold such consent for any reason it deems is in its best interests. d) Cqy Options Upon Breach. In the event that the aforementioned tax exempt covenants are breached, the City may, at its discretion, either pursue any legal remedy allowed or, alternatively, may declare that any obligations otherwise present to continue with the City Contribution is null and void and that its payments to date satisfy all such obligations. e) Covenant Termination. Notwithstanding anything to the contrary contained herein, this Restrictive Covenant shall automatically terminate without notice upon the termination of the District and without recording of additional terminations or releases. The City may, at its discretion, file a notice of termination or release, or similar document, at the expiration of this District. 8) DEVELOPER WARRANTIES AND REPRESENTATIONS. The Developer hereby warrants, represents, and covenants to the City: a) Valid Wisconsin Entity. The Developer is a duly organized and existing Limited Liability Company in the State of Wisconsin and authorized to transact business in the State of Wisconsin. 11 May 4, 2017 b) Transaction Authorized. The execution, delivery, and performance of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized and approved by the Developer, and no other or further acts or proceedings of the Developer or its members, shareholders, directors, or officers are necessary to authorize and approve the execution, delivery, and performance of this Agreement, and the matters contemplated hereby. This Agreement, the exhibits, documents, and instruments associated herewith and made a part hereof, have, if applicable, been duly executed and delivered by the Developer and constitute the legal, valid, and binding agreement and obligation of the Developer, enforceable against the Developer in accordance with their respective terms, except as the enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, or other similar laws affecting the enforcement of creditors' rights generally, and by general equitable principles. c) Lawsuits. There are no lawsuits filed or, to the knowledge of the Developer, pending or threatened against the Developer that may in any material way jeopardize the ability of the Developer to perform its obligations hereunder. d) Sufficient Funding Sources. The Developer has sufficient funds through equity and debt financing sources to continuously operate, maintain, and fulfill the Project. e) Documentation. The Developer shall provide, prior to execution of this Agreement, a (i) a certificate of good standing/current status issued by the appropriate government agency of the state of the Developer's organization, and (ii) certificate of incumbency and resolutions of the limited liability company or corporation which provide for who is authorized to sign on behalf of the Developer and that the Developer is duly authorized to enter into this Agreement and undertake all of the obligations under this Agreement together with all other agreements, documents, and contracts required to be executed in connection with the transactions arising out of this Agreement. 9) CITY WARRANTIES AND REPRESENTATIONS. The City hereby warrants and represents to the Developer that: a) City Authority. Subject to the approval of City Common Council, the execution, delivery, and performance of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized and approved by the City, and no other or further acts or proceedings of the City or its officials are necessary to authorize and approve the execution, delivery, and, subject to annual appropriation by the City Common Council, performance of this Agreement, and the matters contemplated hereby. This Agreement, the exhibits, documents, and instruments associated herewith and made a part hereof, have, if applicable, been duly executed and delivered by the City and constitute the legal, valid, and binding agreement and obligation of the City, enforceable against the City in accordance with their respective terms, except as the enforceability thereof may be limited by applicable law. b) Special Assessments. No special assessments or other charges of any kind shall be assessed or levied against or accrue or come due from the Developer or the Property with 12 May 4, 2017 respect to the Property Project Costs. Notwithstanding the previous sentence, special assessments may be assessed if certain actions or improvements that are related to the Project occur within the public right-of-way. These actions or improvements may include, as examples, curb cuts, driveway aprons, sidewalks, or similar projects. 10) CONDITIONS TO/LIMITATIONS ON THE OBLIGATIONS. a) Release of Obligations. The existence of certain conditions and/or limitations identified in this paragraph 10 may result in the suspension or termination of the parties' responsibilities pursuant to this Agreement, or the suspension or termination of the performance of any and all of the parties' obligations under this Agreement, without recourse against the other party. b) Non -Certification. The Wisconsin Department of Revenue fails to certify all or any portion of the creation of the District or the Project Plan; provided, however, the City shall first make all reasonable efforts in good faith to cure such Non -Certification; or c) Involuntary Termination, The District is involuntarily terminated or dissolved; provided, however, the City shall first make all reasonable efforts in good faith to cure such Involuntary Termination. 11) DEFAULT. a) Event of Default. The occurrence of any one or more of the following events shall constitute a default of the terms of this Agreement: i) Failure to Construct the Pro' ect. The Developer materially fails to construct and complete the Project in a manner that is consistent with the terms of this Agreement after the City has first provided Developer with written notice of such failure and provided the Developer with a reasonable opportunity to cure the same; or ii) Failure to Pay Taxes. The Developer fails to pay any real estate tax, personal property tax, or any special assessment levied or imposed by the State, County, or City against all or any portion of the Property, or against any other property within the City that is owned by the Developer, or against the Developer entity itself if such tax is not attached to any property. This provision shall become effective if the Developer fails to cure such failure, within ninety (90) days after the City provides written notice of such failure. The Developer shall have the right to contest the same in accordance with applicable law. Any payments otherwise due to the Developer may be held in abeyance by the City until this issue is resolved; or iii) Tax Exemption. All or any portion of the Property becomes owned by any entity having a tax exempt status that would cause all or any part of the Property to become tax exempt; or iv) Breach of Agreement. It shall be considered a breach of this agreement if either party breaches any representation or warranty made in this Agreement, or if it is proven that any material document or information provided as a predicate to this Agreement was 13 May 4, 2017 false in a material way as of the time it was given or provide. However, the breaching party shall be provided written notice of such breach and that party shall not be in default unless it has failed to cure such breach within sixty (60) days of such notice. The breaching party shall have a longer period to cure a breach if it has begun to cure such breach in good faith, is diligently continuing to cure such breach, and the actions necessary to cure the breach cannot be reasonably completed within the initial time- frame. v) Insolvency. The Developer shall: (i) become insolvent or generally not pay, or be unable to pay, or admit in writing its inability to pay, its debts as they mature; or (ii) make a general assignment for the benefit of creditors or to an agent authorized to liquidate any substantial amount of its assets; or (iii) become the subject of an order for relief within the meaning of the United States Bankruptcy Code, or file a petition in bankruptcy, for reorganization or to effect a plan or other arrangement with creditors; or (iv) have a petition or application filed against it in bankruptcy or any similar proceeding, and such petition, application or proceeding shall remain undismissed for a period of ninety (90) days or more, or the Developer shall file an answer to such a petition or application, admitting material allegations thereof; or (v) apply to a court for the appointment of a receiver or custodian for any of its assets or properties or have a receiver or custodian appointed for any of its assets or properties, with or without consent, and such receiver shall not be discharged within ninety (90) days after its appointment; or (vi) adopt a plan of complete liquidation of its assets b) Remedies Upon Event of Default. Whenever an Event of Default occurs as described in this Agreement, the City may take one or more of the following actions, in the City's sole and absolute discretion: i) Pursue any or all of the rights and remedies available to the City at law and/or in equity against the Developer and/or any other interested entity, including but not limited to specific performance. ii) Suspend or terminate the performance of any and all of its undertakings and obligations under this Agreement, including, but not limited to, making any further payments for the City Contribution, or any other lawful action under this Agreement. The City may elect to withhold further payments or performance pending the resolution any disputes regarding Developer's Default. iii) Take any action, including legal or administrative action, at law or in equity, which may appear necessary or desirable to the City to enforce performance and observance of any term, obligation, or covenant of the Developer under this Agreement or to seek remedy for its breach. Such rights and remedies shall not be exclusive of any other remedy or remedies, and such rights and remedies shall be cumulative and shall be in addition to every other right and remedy given under this Agreement or now or hereafter existing at law or in equity or by statute. Notwithstanding the foregoing, if an Event of Default occurs, the City's exclusive remedies shall be as set forth in this Agreement: provided, further, that, if Developer fails to complete construction of the 14 May 4, 2017 Project by no later than December 31, 2017, City shall have the further remedy to recover from Developer any Project Costs previously paid by City. 12) INSURANCE. a} Required Coverage. The Developer shall maintain the following insurance policies issued by insurers with a rating of at least "A-" and in a financial size category of at least "X" as established by A.M. Best Company and licensed to do business in the State of Wisconsin: (i) property insurance on the Property with coverage limits equal to the full replacement cost of the building and contents; (ii) commercial general liability insurance with limits of $1,000,000 per occurrence and $5,000,000 in the aggregate; (iii) statutory worker's compensation insurance; and (iv) automobile liability insurance with a combined single limit of $1,000,000. b) Notification before Cancellation. Each insurance policy shall require the insurer to provide at least thirty (30) days prior written notice to the City of any material change or cancellation of such policy. 13) NONDISCRIMINATION. The Developer shall not use the Project in any manner to permit discrimination or restriction on the basis for axe creel, ethnic origin or identity, color, gender, religion, marital status, age, handicap, or national origin, and the Developer shall construct and operate the Project in compliance with all laws, rules, regulations, and ordinances relating to discrimination or any of the foregoing. 14) NO PERSONAL LIABILITY. Under no circumstances shall any Common Council member, official, Director, Member, attorney, employee, or agent of a party have any personal liability arising out of this Agreement, and no party shall seek or claim any such personal liability. 15) CITY AUTHORIZATION. The execution of this Agreement by the City is authorized by Common Council Resolution No. dated 16) MISCELLANEOUS PROVISIONS. a) Term. Unless otherwise terminated by the terms of this Agreement, above, the term of this Agreement shall begin as of the Effective Date and shall continue until November 1, 2044. b} Restriction on Assignment of Agreement. i) Completion of Project. Until the Project is completed, the Developer shall not convey the Property, which includes the parcel in currently owns and containing the building with apartment units, as well as the parcel it will acquire and will contain parking garages and parking lot, to any other party without the City's consent. "Other party" as used in the foregoing sentence includes Affiliates. The City shall not have any obligation to consent to any such a transfer or conveyance and consent may be withheld solely at the City's discretion. 15 May 4, 2017 ii) Subsequent Transfers of PropertX. The Developer may transfer, convey, or assign all or part of the Property after completion of the Project without the consent of the City provided the subsequent owner agrees to assume all of the Developer's obligations under this Agreement. The recording of this Development Agreement with the Winnebago County Register of Deeds shall act as notice to all subsequent owners of the Property and their acceptance of this terms. c) Tax Exempt Organizations. For and in consideration of this Agreement and the nature of the District, the Developer and all successors in interest acknowledges and agree that, during the term of the District, neither the Property nor any part thereof or interest therein shall be sold, transferred, leased, assigned, gifted, owned, used, or conveyed in any way to any person, partnership, organization, or entity that is all or partially exempt from federal or State of Wisconsin income taxes or real or personal property taxes, without the express prior written consent of the City, which such consent may be withheld in the City's sole and absolute discretion. d) Delay in Exercise of Rights Not Waiver. No delay or omission to exercise any right or power accruing to the City or the Developer upon any default by the other party shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient as long as the default is continuing. e) Written Waiver Required. No waiver, amendment, or variation of the terms of this Agreement shall be valid unless it is in writing and signed by authorized representatives of the City and of the Developer. Such written waivers, amendments, or variations shall be narrowly construed and applied only to the extent specifically set forth in writing. f) Force Majeure. A party shall be excused from its obligations under this Agreement if and to the extent and during such time as the party is unable to perform its obligations or is delayed in doing so due to events or conditions outside of the party's reasonable control (each a "Force Majeure Event") based solely upon acts of God, war, fire, or other casualty, riot, civil unrest, extreme weather conditions, terrorism, strikes, and labor disputes. Upon the occurrence of a Force Majeure Event, the party incurring such Force Majeure Event will promptly give notice to the other party, and thereafter the parties shall meet and confer in good faith in order to identify a cure of the condition affecting its performance as expeditiously as possible. g) District Information. As soon as practicable, but no later than December 15 of each calendar year, the City shall provide to the Developer the information pertaining to the Available Tax Increment for the calendar year of the request; provided, however, the City is only required to submit information in its possession and is not required to reply to any request prior to December 15 of any calendar year. h) Time of the Essence. Time is considered to be of the essence with regard to all dates and time periods set forth herein and incorporated herein. May 4, 2017 i) Headings. Descriptive headings are for convenience only and shall not control or affect the meaning or construction of any provision of this Agreement. j) Delivery of Notices. Any notice required by this Agreement shall be given in writing, signed by the party giving notice, personally delivered, mailed by certified or registered mail, return receipt requested, sent by overnight delivery service, or faxed to the parties respective addresses as follows, provided any notice given by facsimile is also given by one of the other methods: To The City: City of Oshkosh Attn: Director of Community Development 215 Church Avenue Post Office Box 1130 Oshkosh, WI 549031130 Facsimile No, 920-236-5106 With a copy to: City of Oshkosh Attn: City Attorney 215 Church Avenue Post Office Box 1130 Oshkosh, WI 54903-1130 Facsimile No. 920-236-5106 To Developer: Discovery Properties, LLC Attn: Randall Schmiedel 230 Ohio Street, Suite 200 Oshkosh, WI 54902 Facsimile No. 920-426-4606 With a copy to: Hirschberg Law, LLC Attn: Jason J. Hirschberg 601 Oregon Street, Suite A Oshkosh, WI 54902 Facsimile No. 920-744-0102 Notices shall be considered to be delivered upon personal delivery, or upon the first business day after certification or registration, the first business day after deposit with the overnight delivery service, or upon acknowledgement of receipt by facsimile or electronic mail (provided notice is promptly sent by one of the other methods). k) Entire _Agreement. This Agreement and all other documents and agreements expressly referred to herein, contain the entire agreement between the Developer and the City with respect to the matters set forth herein. This Agreement may be modified only in writing signed by all parties. 17 May 4, 2017 1) Law_Applicable. This Agreement shall be construed in accordance with the internal laws of the State of Wisconsin. Venue of disputes shall be in Winnebago County or within judicial districts in which Winnebago County is located. m) Originals and Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original. n) Amendments to Agreement. This Agreement shall not be amended orally but only by the written agreement of the parties signed by the appropriate representatives of each party and with the actual authority of each party. o) Limitation on Liability. The parties acknowledge and agree that in carrying out any of the provisions of this Agreement or in exercising any power or authority granted to them thereby, there shall be no personal liability of the either parties' officers, members, agents, employees, or representatives, it being understood and agreed that in such matters they act as agents and representatives of the applicable party. p} No Partnership. This Agreement specifically does not create any partnership or joint venture between the parties, or render any party liable for any debts or obligations of the other party. q) Recording of Agreement. The parties agree that this Agreement will be recorded with the Winnebago County Register of Deeds or, at the City's option a memorandum of this Agreement, including reference to the Restrictive Covenant, may be recorded in lieu of the full Agreement. The Developer shall upon request of the City execute and deliver any such memorandum or other document in connection with such recording. r) Obligations Run with the Land. The obligations under this Agreement and all consents, waivers, restrictions, and other requirements as set forth in this Agreement, shall be deemed to be covenants running with the land and shall be binding upon the Property and the parties' successors, assigns, and other transferees. The obligations of this Agreement shall end upon the termination of the District, except that in the event a separate storm water maintenance agreement is not entered into between the parties at the time the District is terminated, then this Agreement shall continue until the separate storm water agreement is executed and filed with the Winnebago County Register of Deeds. s) Storm Water. The Developer and City shall enter into a separate storm water management facility operation and maintenance agreement that will address storm water issues related to the Property. In the event that storm water issues arise prior to the time this storm water agreement is signed by the parties and recorded with the Register of Deeds, then Developer shall fully comply with the grading and drainage plan for the Property on file with the City Department of Public Works and all applicable storm water codes. The City shall have the authority to enter the property and resolve all grading and drainage issues at Developer's expense including, without limitation, special charges for such work being placed against the Property. This Agreement inures to the benefit of the City and its successors and assigns. 18 May 4, 2017 t) Severance. If any portion of this Agreement is deemed invalid or unenforceable by a court of competent jurisdiction, then the remainder of this Agreement shall remain in full force and effect and enforceable to the fullest extent permitted by law. u) Third Parties. This Agreement is made for the exclusive benefit of the parties to this Agreement, their successors in interest, and their permitted assignees. This Agreement is not for the benefit of any other persons, as third party beneficiaries or otherwise, and this Agreement shall not be deemed to have conferred any rights, expressed or implied, upon any other party, except as described in this Agreement. v) Neutral Construction. This Agreement is the result of negotiations between the parties and each party had sufficient opportunity to have reviewed the final terms with legal counsel. No term, covenant, or provision herein, or the failure to include a term, covenant, or provision shall be construed against any party because that party may have been involved with drafting any portion of this Agreement including attachments hereto. 17) OTHER APPROVALS. In addition to any approvals required under this Agreement, the Developer shall be required to obtain all approvals, consents, and licenses as may be required by any governmental or non-governmental authority in connection with the Project, including, without limitation, all building permits, Project Plan approvals, storm water approvals, and zoning approvals. The Developer's compliance with the terms of this Agreement shall not relieve the Developer from complying with all applicable federal, state and local laws, rules, regulations and ordinances in connection with the Project and to the extent any governmental or non- governmental entity imposes different or more restrictive conditions on the Developer, or the Project, compliance by the Developer with the terms of this Agreement shall not relieve the Developer from complying with such different or more restrictive conditions. Likewise, any less restrictive conditions imposed on the Developer, or the Project by any governmental or non-governmental authority shall not relieve the Developer, or the Project from complying with all of the terms and conditions of this Agreement. [Signature Pages Follow] 19 May 4, 2017 IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the date stated in the first paragraph of this Agreement. DISCOVERY PROPERTIES, LLC BY: Michael Goudreau, Managing Member STATE OF WISCONSIN } } ss. COUNTY OF WINNEBAGO } Personally came before me this day of , 2017, the above-named Michael Goudreau, to me known to be the person who executed and acknowledged the foregoing instrument. Notary Public, State of Wisconsin My Commission expires: 20 May 4, 2017 CITY OF OSHKOSH, WISCONSIN Bv: IN Approved as to form: itz Lynn A. Lorenson, City Attorney STATE OF WISCONSIN } ISS COUNTY OF WINNEBAGO } Mark A. Rohloff, City Manager Pamela R. Ubrig, City Clerk Personally came before me this day of , 2017, the above named Mark A. Rohloff, to me known to be the person who executed and acknowledged the foregoing instrument. Notary Public, State of Wisconsin My Commission expires: STATE OF WISCONSIN } ISS COUNTY OF WINNEBAGO } Personally came before me this day of , 2017, the above named Pamela R. Ubrig, to me known to be the person who executed and acknowledged the foregoing instrument. Notary Public, State of Wisconsin My Commission expires: 21 May 4, 2017 EXHIBIT A Desefi tion of Property 22 May 4, 2017 CERTIFIED SURI/EY MAP FOR DISCOVERY PROPERTIES, LLC THE CITY OF OSHKOSH LOTS A, B AND C IN G. PAPENDIK'S PLAT, LOTS 1, 2 AND 4 AND PART OF LOTS 3 AND 5 IN L. M. FILLER'S FIRST ADDITION, ALL BEING PART OF BLOCK 26 IN THE SECOND WARD, LOCATED IN THE NE 1/4 OF THE SW 1/4, SECTION 24, TOWNSHIP 18 NORTH, RANGE 16 EAST, CITY OF OSHKOSH, WINNEBAGO COUNTY, WISCONSIN. NW C. SIN1/4 SI6 CED.hST 24-18-N.UMuluM NCNUUTxT FOUNo _ Tr80015'31'E 23.68' [ 1189'5fi'16"E 1,789.96' I I 1 7 TOTAL AREJT 42,204 SQ. 0.969 ACRE WASHINGTON AVENUE (PUOUC RIGHT -Or -WAY WIDTH VARIES) LEGEND ® — 1"IRON RFBAR FOUND © — 1/2' IRON REBAR FOUND )( — CUT "X" SET i -- MAG NAIL SET f -- 3/4" IRON REBAR SET O — 3/4" IRON REBAR FOUND A 1/2" IRON PIPE FOUND A. — 1" IRON PIPE FOUND — SECTION CORNER MON. FOUND .IO', f a l boy A .: '�� 1 bA1 HW r C7 A- or, 3 91 i� g L-4-500'45'40 E x -A I I I x ink I ACCESS EASEMENT FOR BVRDMG REPAIR PER I n IDOC. NQ 695879 wY 3/4' LRON RED SC7- �o CN-LWE & 5.O' NORTRERLY `^ OF LOT CORNEA cur'X' SET CN -UNE &-/ 5.0' Wt TERLY oP LOT [ f { CORNER 7 TOTAL AREJT 42,204 SQ. 0.969 ACRE WASHINGTON AVENUE (PUOUC RIGHT -Or -WAY WIDTH VARIES) LEGEND ® — 1"IRON RFBAR FOUND © — 1/2' IRON REBAR FOUND )( — CUT "X" SET i -- MAG NAIL SET f -- 3/4" IRON REBAR SET O — 3/4" IRON REBAR FOUND A 1/2" IRON PIPE FOUND A. — 1" IRON PIPE FOUND — SECTION CORNER MON. FOUND .IO', f a l boy A .: '�� A(Ways a Better Pian bA1 HW r C7 A- or, 3 91 i� g L-4-500'45'40 E x 23.77' A� IRON REBAR RV0. NORTH 1.4' WE T OF LoCORNER& g OWNLR/SUBDIVIDER: DISCOVERY PROPERTIES, LLC 230 OHIO STREET SUITE 200 SURVEYOR: OSHKOSH, WI 54902 RYAN WILGREEN CITY OF OSHKOSH EXCEL ENGINEERING, INC, 215 CHURCH AVENUE 100 CAMFLOT DRIVE P.O. BOX 1130 FOND DU LAC, WI 54935 OSHKOSH, Ws 54903 SHEET 1 OF 5 SHEETS NORTH POINT REFERENCED TO THE WISCONSIN COUNTY COORDINATE SYSTEM, WINNEBAGO COUNTY. THE WEST LINE OF THE SOUTHWEST QUARTER HAS A RECORDED BEARING OF SOUTH 00'-15'-31" EAST. 6p' 0 60' 120' 1"= 60' SCALE FEET A .: '�� A(Ways a Better Pian EXCEL TFON��L�PD PTF IhC, WI 5035 ENGINEERINGl_ FAIL M%9�Cfi- M SURVEYING GROUP PROJECT NO. 1408880 EXHIBIT B Description of Project Plan. May 4, 2017 $,,I't" H L E RS LEADER'S IN PUBLIC FINANCE July 27, 2016 Project Plan Tax Incremental District No. 30 Organizational Joint Review Board Meeting Held: August 2, 2016 Public Hearing Held: August 2, 2016 Consideration for Approval by Plan Commission: August 2, 2016 Consideration for Adoption by Common Council: August 23, 2016 Consideration for Approval by the Joint Review Board: September 6, 2016 �J J, Project Plan Tax Incremental District No. 1. City of Oshkosh Officials Common Council Steve Cummings Debra L. Allison-Aasby Caroline Panske Lori Palmeri Thomas R. Pech, Jr. Steve Hennan Ben Stepanek City Staff Mark Rohloff Allen Davis Darryn Burich Trena Larson Pamela Ubrig Lynn Lorenson Plan Commission David Borsuk Edward Bowen Thomas Fojtik, Chair Ben Krumenauer John Hinz Joint Review Board Mark Rohloff, City Manager Mark Harris, County Executive Melissa Kohn, Director — Oshkosh Campus Allison Garner, School Board President Mayor Deputy Mayor Council Member Council Member Council Member Council Member Council Member City Manager Community Development Director Planning Director Finance Director City Clerk City Attorney Donna Lohry Karl Nollenberger Kathleen Propp Jeffrey Thorns Robert Vajgrt City Representative Winnebago County Fox Valley Technical College District Oshkosh Area School District Public Member Table of Contents EXECUTIVE SUMMARY...........................................................................................................................................1 TYPE AND GENERAL DESCRIPTION OF DISTRICT........................................................................................4 PRELIMINARY MAPS OF PROPOSED DISTRICT BOUNDARY......................................................................5 MAPS SHOWING EXISTING USES AND CONDITIONS...................................................................................7 PRELIMINARY PARCEL LIST AND ANALYSIS...................................................................................................9 EQUALIZED VALUE TEST.....................................................................................................................................10 STATEMENT OF KIND, NUMBER AND LOCATION OF PROPOSED PUBLIC WORKS AND OTHER PROJECTS................................................................................................................................................................11 MAPS SHOWING PROPOSED IMPROVEMENTS AND USES......................................................................14 DETAILED LIST OF PROJECT COSTS..............................................................................................................16 ECONOMIC FEASIBILITY STUDY, FINANCING METHODS, AND THE TIME WHEN COSTS OR MONETARY OBLIGATIONS RELATED ARE TO BE INCURRED..................................................................17 ESTIMATE OF PROPERTY TO BE DEVOTED TO RETAIL BUSINESS......................................................22 PROPOSED ZONING ORDINANCE CHANGES................................................................................................22 PROPOSED CHANGES IN MASTER PLAN, MAP, BUILDING CODES AND CITY OF OSHKOSH ORDINANCES..........................................................................................................................................................22 RELOCATION...........................................................................................................................................................22 ORDERLY DEVELOPMENT OF THE CITY OF OSHKOSH.............................................................................23 LIST OF ESTIMATED NON -PROJECT COSTS.................................................................................................23 OPINION OF ATTORNEY FOR THE CITY OF OSHKOSH ADVISING WHETHER THE PLAN IS COMPLETE AND COMPLIES WITH WISCONSIN STATUTES 66.1105......................................................24 CALCULATION OF THE SHARE OF PROJECTED TAX INCREMENTS ESTIMATED TO BE PAID BY THE OWNERS OF PROPERTY IN THE OVERLYING TAXING JURISDICTIONS......................................25 APPENDIX A - TAX INCREMENT FINANCING APPLICATION......................................................26 APPENDIX B - MARKET STUDY AND INVESTMENT ANALYSIS REPORT (INVESTA-ANALYTICS).... 38 PLAN COMMISSION PUBLIC HEARING/MINUTES OF AUGUST 2, 2016 ...........................................56 COMMON COUNCIL CREATION RESOLUTION OF AUGUST 23, 2016 ..............................................62 JOINT REVIEW BOARD RESOLUTION OF SEPTEMBER 6, 2016........................................................65 SECTION 1: Executive Summary Description of District Type of District, Size and Location Tax Incremental District No. 30 (the "TID" or "District") is a proposed one acre district in need of rehabilitation or conservation located in downtown Oshkosh at the intersection of Washington and State Street. The proposed District will be created to help support a proposed renovation of the Fraternal Reserve Association Building located at 105 Washington Avenue involving conversion of roughly 29,100 sq. ft. of vacant commercial space to twenty residential apartment units. The District also includes a public parking lot currently owned by the City which will be partially converted to enclosed private parking, and an additional commercial building located at 300 State Street which could potentially be rehabilitated in the future. A map of the proposed District boundaries is located in Section 3 of this plan. Estimated Total Project Expenditures The City anticipates making total Project Cost expenditures of approximately $680,000 to facilitate rehabilitation of 105 Washington Avenue including an estimated $530,000 for development incentives, $88,000 for parking lot reconstruction and the balance for administrative expense and payment of interest on funds expected to be advanced to the District to cover necessary expenditures prior to establishment of the District's increment revenue stream. No specific Project Costs are identified for 300 State Street, however, the City would expect to make available appropriate development incentives or other assistance at the time a rehabilitation project is proposed without further amending this Plan. Economic Development As a result of the creation of this District, the City projects that additional land and improvements value of approximately $1.3 million will be created as a result of the rehabilitation project and subsequent economic appreciation. This additional value will be a direct result of the improvements made and projects undertaken within the District. A table detailing assumptions as to the timing of development and associated values is located in Section 10 of this Plan. In addition, creation of the District is expected to result in other economic benefits as detailed in the Summary of Findings hereafter. Expected Termination of District Based on the Economic Feasibility Study located in Section 10 of this Plan, this District would be expected to remain open for 25 years of its 27 year maximum statutory life. Summary of Findings As required by Wisconsin Statutes Section 66.1105, and as documented in this Project Plan and the exhibits contained and referenced herein, the following findings are made: 1. That "but for" the creation of this District, the development projected to occur as detailed in this Project Plan: 1) would not occur; or 2) would not occur in the manner, at the values, or within the timeframe desired by the City. In making this detennination, the City has considered the following infonnation: The economics associated with rehabilitation projects which typically involve additional costs such as abatement of hazardous materials, utility relocations, use of high end finishes needed to Piroject Rlan TID No. 30 Cireatlion Gity of Oshkosh ul imi tied by Ehlleirs Wage 1 dully 27, 2016 attract tenants, provision of adequate off-street parking through the construction of garages, and other similar costs. As such, the City believes that these sites are not likely to be redeveloped under normal market conditions without public investment and participation. 2. The economic benefits of the Tax Incremental District, as measured by increased employment, business and personal income, and property value, are sufficient to compensate for the cost of the improvements. In making this determination, the City has considered the following information: As demonstrated in the Economic Feasibility Section of this Project Plan, the tax increments projected to be collected are sufficient to pay for the cost of the development incentives and other related Project Costs needed to facilitate the desired rehabilitation work. • The rehabilitation expected to occur within the District will create 20 residential units, providing housing opportunities for City residents. • It is expected that the rehabilitation project will create a 0.5 Full -Time Equivalent (FTE) position for property management and another 0.5 FTE position for property maintenance. 3. The benefits of the proposal outweigh the anticipated tax increments to be paid by the owners of property in the overlying taxing jurisdictions. If approved, the District's creation would become effective for valuation purposes as of January 1, 2016. As of this date, the values of all existing real and personal property within the District would be frozen and the property taxes collected on this base value would continue to be distributed amongst the various taxing entities as they currently are now. Taxes levied on any additional value established within the District due to new construction, renovation or appreciation of property values occurring after January 1, 2016 would be collected by the TID and used to repay the costs of TIF -eligible projects undertaken within the District. Since the development expected to occur is unlikely to take place or in the same manner without the use of TIF (see Finding #1) and since the District will generate economic benefits that are more than sufficient to compensate for the cost of the improvements (see Finding #2), the City reasonably concludes that the overall benefits of the District outweigh the anticipated tax increments to be paid by the owners of property in the overlying taxing jurisdictions. It is further concluded that since the "but for" test is satisfied, there would, in fact, be no foregone tax increments to be paid in the event the District is not created. As required by Section 66.1105(4)(1)4., a calculation of the share of projected tax increments estimated to be paid by the owners of property in the overlying taxing jurisdictions has been made and can be found in Appendix A of this plan. 4. Not less than 50% by area of the real property within the District is in need of rehabilitation or conservation work within the meaning of Wisconsin Statutes Section 66.1337(2m)(b). 5. Based upon the finding stated above the District is declared to be a District In Need of Rehabilitation of Conservation based on the identification and classification of the property included within the District. 6. The Project Costs relate directly to promoting rehabilitation or conservation consistent with the purpose for which the District is created. Piroject Rlwi TID No. 30 Cireatliorl Gity of Oshkosh Subimr tied by Ehlloirs Page 2 Tally 27, 2016 7. The improvement of such area is likely to enhance significantly the value of substantially all of the other real property in the District. The equalized value of taxable property of the District, plus the value increment of all existing tax incremental districts within the City, does not exceed 12% of the total equalized value of taxable property within the City. 9. The City estimates that less than 35% of the territory within the District will be devoted to retail business at the end of the District's maximum expenditure period, pursuant to Wisconsin Statutes Sections 66.1105(5)(b) and 66.1105(6)(am)l. 10. The Project Plan for the District in the City is feasible, and is in confonnity with the master plan of the City. Pirojact Rlarl TID No. 30 Ciraatliorl Gity of Oshkosh Subimr tied by Ehlloirs Page 3 Tally 27, 2016 SECTION 2: Type and General Description of District The District, comprising one acre in downtown Oshkosh at the intersection of Washington and State Street, is being created by the City under the authority provided by Wisconsin Statute Section 66.1105 and will be classified as a district "in need of rehabilitation or conservation" based on a finding that at least 50%, by area, of the real property within the District meets that condition as defined in Wisconsin Statute Section 66.1337(2m)(a). The preliminary parcel list included in Section 5 to this Plan identifies those parcels meeting those criteria. Collectively, these parcels represent 100% of the total District area. Creation of the District is intended to facilitate achievement of the City's project goals and desired outcomes for this area by providing the means to pay the necessary costs needed to incentivize the developer to undertake the rehabilitation project. A preliminary map of the proposed District boundary can be found in Section 3 of this Plan. Pirojact Rlarl TID No. 30 Ciraatliorl Gity of Oshkosh Subimr tied by Ehlloirs Page 4 Tally 27, 2016 SECTION 3: Preliminary Maps of Proposed District Boundary Project Ran TID No. 30 Cireahon Gity of Oshkosh Subim�tied by EMeirs Page 5 Tally 27, 2016 Tax Increment District #30 Washington Building Redevelopment District Boundary Ow Oshkosh A,,,, 24B, 226 .......... ... . .. . LU LU 0 Uj .... ................ ................. t4', ------------ gas ............. ............ .......... �J ---------- .......... .......... ............. ........... ........... ---------- ---------- ............. ---------- - .......... ............................... ............................. . . .................. ------------- ----------------......................... ....................... ... ....... .......... . Legend TID n30 Boundary OTTERAVS Feet July, 2016 Project Ran TID No. 30 Cireahon Gity of Oshkosh Subim�tied by EMeirs Page 5 Tally 27, 2016 Tax Increment District #30 Washington Building Redevelopment cil':W Parcel Identification Oshkosh Tax Increment #36 - Washington Building Redevelopment - Parcel Identification Map ID Parcel N Owner Local Address Land Improv. Tofal Equalised Class Description Dwelling Census inning Value Value Value Value Dnifs Traci 1 02-0055-0000 DISCOVERY PROPERTIES LLC 105 WASHINGTON AVE $42,000 $358,000 $440,000 $440,000 B WASHINGTON BUILDING 0 5 C -3D0 2 02-0062-0000 CITY OF OSHKOSH 0 STATE ST 0 0 0 4 STATE STREET PARKING LOT 0 5 C -3D0 ':1. 3 02-0064-0000 KIECKHAFER REV TRUST H A/PD 300 STATE ST $16,100 $105,900 $122,000 $122,000 B ADVANCE OFFICE SYSTEMS 0 5 C -3D0 ':', W LL w OTTER A VE 11) z 0 z De w 7 A yE Legend TID #30 Boundary 0 25 50 100 Feet wE July, 2016 Project Ran TID No. 30 Ciraahon Gity of Oshkosh Subimr tied by EMeirs Page 6 Jdly 27, 2016 SECTION 4: Maps Showing Existing Uses and Conditions c 0D. 0 CL D CRO C 0 cc > U 0 0 a) 0 L< C3 z 0) u 02 (D x uj Project Ran TID No. 30 Cireahon Gity of Oshkosh Subim�tied by EMeirs Page 7 Tally 27, 2016 lsj�(70 1 U.1 iz ISNQN�OA-I)N VIE IS NOS8�AAf L, > ale, < 3: ro k4r . ................................. ---------------- om ou 9s", mz 90g: IS NIV1N N W > W ELI 14 Project Ran TID No. 30 Cireahon Gity of Oshkosh Subim�tied by EMeirs Page 7 Tally 27, 2016 Project Ran TID No. 30 Cireahon Gity of Oshkosh Subim�tied by EMeirs Page 6 Tally 27, 2016 SECTION 5: Preliminary Parcel List and Analysis N.— Assessed valuations listed are preliminary January 1, 2016, Ratio shown is for January 1, 2015, Ratio for 2016 not yet available Project Pian TILT No, 30 Creation City of Oshkosh SSubautted by Ehlers, Page H July 27, 2016 SECTION 6: Equalized Value Test The following calculations demonstrate that the City expects to be in compliance with Wisconsin Statutes Section. 66.1105(4)(gm)4.c. which requires that the equalized value of the taxable property in the proposed District, plus the value increment of all existing tax incremental districts, does not exceed 12% of the total equalized value of taxable property within the City. The equalized value of the increment of existing tax incremental districts within the City, plus the base value of the proposed District, totals $246,105,970. This value is less than the maximum of $449,237,400 in equalized value that is pennitted for the City of Oshkosh. The City therefore anticipates that it will be in compliance with the statutory equalized valuation test and may proceed with creation of this District. District Creation Date Total EV (TID In) 12% Test Increment of 9/1/2016 Valuation Data Percent Valuation Data Currently Available Change Est. Creation Date 2015 M10141/m/01 1/011 449,237,400 449,237,400 Total Existing Increment Projected Base of New or Amended District Tota I Value Subject to 12% Test Compliance 245,544,700 561,270 246,105,970 245,544,700 246,105,970 Pirojact Rlarl TID No. 30 Cireatiorl Gity of Oshkosh Subimr tied by Ehlloirs Page 10 July 27, 2016 SECTION 7: Statement of Kind, Number and Location of Proposed Public Works and Other Projects Project Costs are any expenditure made, estimated to be made, or monetary obligations incurred or estimated to be incurred, by the City as outlined in this Plan. Project Costs will be diminished by any income, special assessments or other revenues, including user fees or charges received. To the extent the costs of a Project benefit the City outside the District that proportionate share of the cost is not a Project Cost. Costs identified in this Plan are preliminary estimates made prior to design considerations and are subject to change after planning is completed. Pro -ration of costs in the Plan are also estimates and subject to change based upon implementation, future assessment policies and user fee adjustments. The following is a list of public works and other TIF -eligible projects that the City may need to implement in conjunction with this District. Any costs necessary or convenient to the creation of the District or directly or indirectly related to the public works and other projects are considered Project Costs and eligible to be paid with tax increment revenues of the District. Property, Right -of -Way and Easement Acquisition Property Acquisition In order to promote and facilitate redevelopment the City may acquire property within the District. The cost of property acquired, and any costs associated with the transaction, are eligible Project Costs. Following acquisition, other Project Costs within the categories detailed in this Section may be incurred in order to make the property suitable for development. Any revenue received by the City from the sale of property acquired pursuant to the execution of this Plan will be used to reduce the total project costs of the District. If total Project Costs incurred by the City to acquire property and make it suitable for development and/or redevelopment exceed the revenues or other consideration received from the sale or lease of that property, the net amount shall be considered "real property assembly costs" as defined in Wisconsin Statutes Section 66.1105(2)(f)l.c., and subject to recovery as an eligible Project Cost. Acquisition of Rights -of -Way The City may need to acquire property to allow for installation of streets, driveways, sidewalks, utilities, stonnwater management practices and other public infrastructure. Costs incurred by the City to identify, negotiate and acquire rights-of-way are eligible Project Costs. Acquisition of Easements The City may need to acquire temporary or pennanent easements to allow for installation and maintenance of streets, driveways, sidewalks, utilities, stonnwater management practices and other public infrastructure. Costs incurred by the City to identify, negotiate and acquire easement rights are eligible Project Costs. Relocation Costs If relocation expenses are incurred in conjunction with the acquisition of property, those expenses are eligible Project Costs. These costs may include, but are not limited to: preparation of a relocation plan; allocations of staff time; legal fees; publication of notices; obtaining appraisals; and payment of relocation benefits as required by Wisconsin Statutes Sections 32.19 and 32.195. Piroject Rlan TID No. 30 Cireatlion Gity of Oshkosh ul imi tied by Ehlleirs Wage 11 dully 27, 2016 Site Preparation Activities Environmental Audits and Remediation There have been no known environmental studies perforined within the proposed District. If, however, it becomes necessary to evaluate any land or improvement within the District, any cost incurred by the City related to environmental audits, testing, and remediation are eligible Project Costs. Demolition In order to make sites suitable for development, the City may incur costs related to demolition and removal of structures or other land improvements, to include abandonment of wells or other existing utility services. Site Grading Land within the District may require grading to make it suitable for development and/or redevelopment, to provide access, and to control storinwater runoff. The City may need to remove and dispose of excess material, or bring in fill material to provide for proper site elevations. Expenses incurred by the City for site grading are eligible Project Costs. RDA Type Activities Contribution to Redevelopment Authority As provided for in Wisconsin Statues Sections 66.1105(2)(f)l.h and 66.1333(13), the City may provide funds to its RDA to be used for administration, planning operations, and capital costs, including but not limited to real property acquisition, related to the purposes for which it was established in furtherance of any redevelopment or urban renewal project. Funds provided to the RDA for this purpose are eligible Project Costs. Revolving Loan/Grant Program To encourage private redevelopment consistent with the objectives of this Plan, the City, through its RDA, may provide loans and/or matching grants to eligible property owners in the District. Loan and/or matching grant recipients will be required to sign an agreement specifying the nature of the property improvements to be made. Eligible improvements will be those that are likely to improve the value of the property, enhance the visual appearance of the property and surrounding area, correct safety deficiencies, or as otherwise specified by the RDA in the program manual. Any funds returned to the RDA from the repayment of loans made are not considered revenues to the District, and will not be used to offset District Project Costs. Instead, these funds may be placed into a revolving loan fund and will continue to be used for the program purposes stated above. Any funds provided to the RDA for purposes of implementing this program are considered eligible Project Costs. Miscellaneous Cash Grants (Development Incentives) The City may enter into agreements with property owners, lessees, or developers of land located within the District for the purpose of sharing costs to encourage the desired kind of improvements and assure tax base is generated sufficient to recover project costs. No cash grants will be provided until the City executes a developer agreement with the recipient of the cash grant. Any payments of cash grants made by the City are eligible Project Costs. Piroject Rlan TID No. 30 Cireatlion Gity of Oshkosh ul imi tied by Ehlleirs Wage 12 dully 27, 2016 Professional Service and Organizational Costs The costs of professional services rendered, and other costs incurred, in relation to the creation, administration and termination of the District, and the undertaking of the projects contained within this Plan, are eligible Project Costs. Professional services include, but are not limited to: architectural; environmental; planning; engineering; legal, audit; financial; and the costs of informing the public with respect to the creation of the District and the implementation of the Plan. Administrative Costs The City may charge to the District as eligible Project Costs reasonable allocations of administrative costs, including, but not limited to, employee salaries. Costs allocated will bear a direct connection to the time spent by City employees in connection with the implementation of the Plan. Financing Costs Interest expense, debt issuance expenses, redemption premiums, and any other fees and costs incurred in conjunction with obtaining financing for projects undertaken under this Plan are eligible Project Costs. With all Projects the costs of engineering, design, survey, inspection, materials, construction, restoring property to its original condition, apparatus necessary for public works, legal and other consultant fees, testing, environmental studies, pernits, updating City ordinances and plans, judgments or claims for damages and other expenses are included as Project Costs. In the event any of the Project Cost expenditures included in this Plan are determined not to be reimbursable out of the TIF fund by counsel retained by the City for purposes of making such determination, or a court of record so rules in a final order, then such Project Cost is deleted from this Plan and the remainder of the Projects shall be deemed the entirety of the Projects for purposes of this Plan. The City reserves the right to implement only those projects that remain viable as the Plan period proceeds. Piroject Rlan TID No. 30 0;ireatlion Gity of Oshkosh ial imi tied by Ehlleirs Wage 13 Tally 27, 2016 SECTION 8: Maps Showing Proposed Improvements and Uses Tax Increment District #30 00 Washington Building Redevelopment cilyctwr Proposed Improvements Oshkosh Project Ran TID No. 30 Cireahon Gity of Oshkosh Subim�tied by EMeirs Page 14 Tally 27, 2016 7 0 > U CD 0 u m z ua C2 CL CL Is Nosd34:lr ZL 'We 0 Project Ran TID No. 30 Cireahon Gity of Oshkosh Subim�tied by EMeirs Page 15 Tally 27, 2016 SECTION 9: Detailed List of Project Costs All costs are based on 2016 prices and are preliminary estimates. The City reserves the right to increase these costs to reflect inflationary increases and other uncontrollable circumstances between 2016 and the time the expenditure is made. The City also reserves the right to increase certain Project Costs to the extent others are reduced or not implemented without amending the Plan. The tax increment allocation is preliminary and is subject to adjustment based upon the implementation of the Plan. This Plan is not meant to be a budget nor an appropriation of funds for specific projects, but a framework within which to manage projects. All costs included in the Plan are estimates based on best information available. The City retains the right to delete projects or change the scope and/or timing of projects implemented as they are individually authorized by the Common Council, without amending the Plan. Proposed TIF Project Cost Estimates Piroject Rlarl TID No. 30 Cireatiorl Gity of Oshkosh Subimr tied by Ehlloirs Fags 16 Tally 27, 2016 SECTION 10: Economic Feasibility Study, Financing Methods, and the Time When Costs or Monetary Obligations Related are to be Incurred The inforination and exhibits contained within this Section demonstrate that the proposed District is economically feasible insofar as: • The City has available to it the means to secure the necessary financing required to accomplish the projects contained within this Plan. A listing of "Available Financing Methods" follows. • The City expects to complete the projects in one or multiple phases, and can adjust the timing of implementation as needed to coincide with the pace of private development. A discussion of the phasing and projected timeline for project completion is discussed under "Plan Implementation" within this Section. A table identifying the financing method for each phase and the time at which that financing is expected to be incurred is included. The development anticipated to occur as a result of the implementation of this Plan will generate sufficient tax increments to pay for the cost of the Projects. Within this Section are tables identifying: 1) the development and redevelopment expected to occur; 2) a projection of tax increments to be collected resulting from that development and redevelopment and other economic growth within the District; and 3) a cash flow model demonstrating that the projected tax increment collections and all other revenues available to the District will be sufficient to pay all Project Costs. Available Financing Methods To the extent Project Costs cannot be paid from cash on hand, the following is a list of the types of debt obligations that the City could utilize to raise the capital needed to finance Project Costs or to pay cominitments to developers. General Obligation (G.O.) Bonds or Notes The City may issue G.O. Bonds or Notes to finance the cost of projects included within this Plan. The Wisconsin State Constitution limits the principal amount of G.O. debt that the City may have outstanding at any point in time to an amount not greater than five percent of its total equalized value. As of December 31, 2015 the City had approximately $41.8 million in unused G.O. debt capacity available. Bonds Issued to Developers ("Pay as You Go" Financing) The City may issue a bond or other obligation to one or more developers who provide financing for projects included in this Pian. Repayment of the amounts due to the developer under the bonds or other obligations are limited to an agreed percentage of the available annual tax increments collected that result from the improvements made by the developer. To the extent the tax increments collected are insufficient to make annual payments, or to repay the entire obligation over the life of the District, the City's obligation is limited to not more than the agreed percentage of the actual increments collected. Bonds or other obligations issued to developers in this fashion are not general obligations of the City and, therefore, do not count against the City's statutory borrowing capacity. Piroject Rlan TID No. 30 Cireatlion Gity of Oshkosh ul imi tied by Ehlleirs Wage 17 dully 27, 2016 Tax Increment Revenue Bonds The City has the authority to issue revenue bonds secured by the tax increments to be collected. These bonds may be issued directly by the City, or as a forin of lease revenue bond by a Redevelopment Authority. Tax Increment Revenue Bonds and Lease Revenue Bonds are not general obligations of the City and therefore do not count against the City's statutory borrowing capacity. To the extent tax increments collected are insufficient to meet the annual debt service requirements of the revenue bonds, the City may be subject to either a permissive or mandatory requirement to appropriate on an annual basis a sum equal to the actual or projected shortfall. Utility Revenue Bonds The City can issue revenue bonds to be repaid from revenues of the its various systems, including revenues paid by the City that represent service of the system to the City. There is neither a statutory nor constitutional limitation on the amount of revenue bonds that can be issued, however, water rates are controlled by the Wisconsin Public Service Commission and the City must demonstrate to bond purchasers its ability to repay revenue debt with the assigned rates. To the extent the City utilizes utility revenues other than tax increments to repay a portion of the bonds, the City must reduce the total eligible Project Costs in an equal amount. Special Assessment "B" Bonds The City has the ability to levy special assessments against benefited properties to pay part of the costs for street, curb, gutter, sewer, water, storm sewers and other infrastructure. In the event the City deterinines that special assessments are appropriate, the City can issue Special Assessment B bonds pledging revenues from special assessment installments to the extent assessment payments are outstanding. These bonds are not counted against the City's statutory borrowing capacity. If special assessments are levied, the City must reduce the total eligible Project Costs under this Plan in an amount equal to the total collected. Plan Implementation The City anticipates making total Project Cost expenditures of approximately $680,000 to support rehabilitation of 105 Washington Avenue including an estimated $530,000 for development incentives, $88,000 for public parking lot reconstruction and the balance for administrative expense and payment of interest on funds expected to be advanced to the District to cover necessary expenditures prior to establishment of the District's increment revenue stream. The City expects to incur the development incentive obligation through a development agreement to be entered into in 2016, with payments to be made on a "pay as you go" basis through the life of the District. The City would also incur the cost for parking lot reconstruction in 2016 and expects to advance funds for this purpose with recovery of the advanced amounts and accrued interest over time. No specific Project Costs are identified for 300 State Street, however, the City would expect to make available appropriate development incentives or other assistance at the time a rehabilitation project is proposed without further amending this Plan. It is important to note that this Plan does not constitute approval of any particular projects. Based on the 27 year maximum life of the District and corresponding 22 year expenditure period, it can be expected that economic conditions will change throughout the District's life and will alter the projections contained in this Plan. Decisions to undertake specific Projects through the life of the District must be made in the context of the current financial position of the TID and forecasts updated to reflect the best information available at that time. If financing as outlined in this Plan proves unworkable, the City reserves the right to use alternate financing solutions for the projects as they are implemented. Piroject Rlan TID No. 30 Cireatlion Gity of Oshkosh ul imi tied by Ehlleirs Wage 18 dully 27, 2016 Development Assumptions Notes: 1Projected valuation as estimated by developer and listed within the "Tax Incremental Financing Policy and Application" dated April 30, 2016. Converted to equalized value by Ehlers. Project Ran TID No. 30 Ciraatliun Gity of Oshkosh ul imi tied by Ehlleirs Page 19 dully 27, 2016 20 Unit Apt. Construction Year i Annual Total Construction Year Building 1 2016 856,287 856,287 2016 1 2 2017 0 2017 2 3 2018 0 2018 3 4 2019 0 2019 4 5 2020 0 2020 5 6 2021 0 2021 6 7 2022 0 2022 7 8 2023 0 2023 8 9 2024 0 2024 9 10 2025 0 2025 10 11 2026 0 2026 11 12 2027 0 2027 12 13 2028 0 2028 13 14 2029 0 2029 14 15 2030 0 2030 15 16 2031 0 2031 16 17 2032 0 2032 17 18 2033 0 2033 18 19 2034 0 2034 19 20 2035 0 2035 20 21 2036 0 2036 21 22 2037 0 2037 22 23 2038 0 2038 23 24 2039 0 2039 24 25 2040 0 2040 25 26 2041 0 2041 26 27 2042 0 2042 27 Totals 856.287 856.287 Notes: 1Projected valuation as estimated by developer and listed within the "Tax Incremental Financing Policy and Application" dated April 30, 2016. Converted to equalized value by Ehlers. Project Ran TID No. 30 Ciraatliun Gity of Oshkosh ul imi tied by Ehlleirs Page 19 dully 27, 2016 Increment Revenue Projections Type of District District Creation Date Valuation Date Max Life (Years) Expenditure Period/Termination Revenue Periods/Final Year Extension Eligibility/Years Recipient District Base Value Appreciation Factor Base Tax Rate Rate Adjustment Factor Discount Rate Construction Inflation Total Year Value Added Valuation Year Increment Increment Revenue Year Tax Rate' Tax Increment NPV Calculation 1 2016 856,287 2017 2 2017 0 2018 3 2018 0 2019 4 2019 0 2020 5 2020 0 2021 6 2021 0 2022 7 2022 0 2023 8 2023 0 2024 9 2024 0 2025 10 2025 0 2026 11 2026 0 2027 12 2027 0 2028 13 2028 0 2029 14 2029 0 2030 15 2030 0 2031 16 2031 0 2032 17 2032 0 2033 18 2033 0 2034 19 2034 0 2035 20 2035 0 2036 21 2036 0 2037 22 2037 0 2038 23 2038 0 2039 24 2039 0 2040 25 2040 0 2041 26 2041 0 2042 27 2042 0 2043 5,613 861,900 2018 14,232 876,131 2019 14,374 890,505 2020 14,518 905,023 2021 14,663 919,686 2022 14,810 934,495 2023 14,958 949,453 2024 15,107 964,560 2025 15,258 979,819 2026 15,411 995,230 2027 15,565 1,010,795 2028 15,721 1,026,515 2029 15,878 1,042,393 2030 16,037 1,058,430 2031 16,197 1,074,627 2032 16,359 1,090,986 2033 16,523 1,107,508 2034 16,688 1,124,196 2035 16,855 1,141,051 2036 17,023 1,158,074 2037 17,193 1,175,267 2038 17,365 1,192,633 2039 17,539 1,210,172 2040 17,714 1,227,886 2041 17,892 1,245,778 2042 18,070 1,263,848 2043 18,251 1,282,099 2044 Notes: 'Tax rate is actual rate for 2015/16 taken from the City's Tax Increment Worksheet (DOR Form PC -202). $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 $25.95 21,916 43,746 65,489 87,142 108,705 130,174 151,548 172,827 194,008 215,090 236,071 256,951 277,728 298,401 318,968 339,429 359,783 380,028 400,164 420,190 440,105 459,909 479,600 499,177 518,641 537,991 557,226 Project Ran TID No. 30 0;iraatlian Gity of Oshkosh Ial imi tied by Ehlleirs Page 20 drolly 27, 2016 Cash Flow Project Plain TO No. 37 Creation City of Oslhkoslh Submitted by Ehlers Page 21 July 2'7, 2016 ---------------------- Year Advance From Municipal City Contrib. Tax Other City Total Revenue Repayment of to Parking Lot Total Advance Increments Funds Revenues Obligation' City Adva nce2 Rennovation Admin. Expenditures Annual Cumulative Outstanding Year 2016 98,000 98,000 88,000 10,000 98,000 0 0 98,653 2016 2017 1,000 1,000 1,000 1,000 0 0 101,646 2017 2018 22,365 22,365 15,774 5,591 1,000 22,365 0 0 97,088 2018 2019 22,735 22,735 16,051 5,684 1,000 22,735 0 0 93,346 2019 2020 23,108 23,108 16,331 5,777 1,000 23,108 0 0 89,436 2020 2021 23,484 23,484 16,613 5,871 1,000 23,484 0 0 85,354 2021 2022 23,865 23,865 16,899 5,966 1,000 23,865 0 0 81,095 2022 2023 24,249 24,249 17,187 6,062 1,000 24,249 0 0 76,654 2023 2024 24,637 24,637 17,478 6,159 1,000 24,637 0 0 72,028 2024 2025 25,029 25,029 17,772 6,257 1,000 25,029 0 0 67,211 2025 2026 25,425 25,425 18,069 6,356 1,000 25,425 0 0 62,199 2026 2027 25,825 25,825 18,369 6,456 1,000 25,825 0 0 56,987 2027 2028 26,229 26,229 18,672 6,557 1,000 26,229 0 0 51,570 2028 2029 26,637 26,637 18,978 6,659 1,000 26,637 0 0 45,942 2029 2030 27,049 27,049 19,287 6,762 1,000 27,049 0 0 40,098 2030 2031 27,465 27,465 19,599 6,866 1,000 27,465 0 0 34,034 2031 2032 27,885 27,885 19,914 6,971 1,000 27,885 0 0 27,744 2032 2033 28,310 28,310 20,232 7,077 1,000 28,310 0 0 21,221 2033 2034 28,739 28,739 20,554 7,185 1,000 28,739 0 0 14,461 2034 2035 29,172 29,172 20,879 7,293 1,000 29,172 0 0 7,457 2035 2036 29,609 29,609 21,207 7,402 1,000 29,609 0 0 204 2036 2037 30,051 30,051 28,843 208 1,000 30,051 0 0 0 2037 2038 30,497 30,497 29,497 1,000 30,497 0 0 2038 2039 30,947 30,947 29,947 1,000 30,947 0 0 2039 2040 31,402 31,402 30,402 1,000 31,402 0 0 2040 2041 31,862 31,862 30,862 1,000 31,862 0 0 2041 2042 32,326 32,326 31,326 1,000 32,326 0 0 2042 2043 32,795 32,795 0 32,795 32,795 2043 2044 33,269 33,269 0 33,269 66,064 2044 al 744,966 99,000 843,966 530,739 123,162 88,000 36,000 777,901 Total Protected TO Closure ['1-.�lto.t.0- ofIncrement generated byrehabllltation project less annual adonini ratwe expenseand a mounts paidto recover priorCityadvances.e the City will charge .2% cost of funds on advanced amounts and will allocate 25% of the annual Increment collected to repay the advance. Project Plain TO No. 37 Creation City of Oslhkoslh Submitted by Ehlers Page 21 July 2'7, 2016 SECTION 11: Annexed Property There are no lands proposed for inclusion within the District that were annexed by the City on or after January 1, 2004. SECTION 12: Estimate of Property to be Devoted to Retail Business Pursuant to Wisconsin Statutes Sections 66.1105(5)(b) and 66.1105(6)(am)l, the City estimates that less than 35% of the territory within the District will be devoted to retail business at the end of the District's maximum expenditure period. SECTION 13: Proposed Zoning Ordinance Changes The proposed Plan is in general confonnance with the City of Oshkosh's present zoning and no changes are anticipated to the Plan area's C-3 zoning to implement the Plan. SECTION 14: Proposed Changes in Master Plan, Map, Building Codes and City of Oshkosh Ordinances The proposed Plan is in general confonnance with the City of Oshkosh's Comprehensive Plan identifying the area as appropriate for mixed downtown development. All development within the District will be required to confonn to the State Building Codes and will be subject to the City's pennitting and inspection procedures. The proposed Plan confonn to all relevant State and local ordinances, plans, and codes, thus, no changes to the existing regulations are proposed or needed. SECTION 15: Relocation Where the relocation of individuals and business operations would take place as a result of the City's acquisition activities occurring within the District, relocation will be carried out in accordance with the relocation requirements set forth in Chapter 32 of the Wisconsin Statutes and the Federal Uniform Relocation Assistance and Real Property Acquisitions Policy Act of 1970 (P.L. 91-646) as applicable. Pirojact Rlarl TID No. 30 Ciraatliorl Gity of Oshkosh Subimr tied by Ehlloirs Page 22 Tally 27, 2016 SECTION 16: Orderly Development of the City of Oshkosh Creation of the District and the implementation of the projects in its Plan will promote the orderly redevelopment of the City of Oshkosh by preserving, rehabilitating and reusing existing structures. By utilizing the provisions of the Tax Increment Finance Law, the City can stabilize property values and attract new investment that results in increased tax base. Development of new uses in the District will add to the tax base and will generate positive secondary impacts in the community such as additional housing opportunities and increased employment opportunities. SECTION 17: List of Estimated Non -Project Costs Non -Project costs are public works projects that only partly benefit the District or are not eligible to be paid with tax increments, or costs not eligible to be paid with TIF funds. Examples would include: A public improvement made within the District that also benefits property outside the District. That portion of the total project costs allocable to properties outside of the District would be a non -project cost. A public improvement made outside the District that only partially benefits property within the District. That portion of the total project costs allocable to properties outside of the District would be a non -project cost. Projects undertaken within the District as part of the implementation of this Project Plan, the costs of which are paid fully or in part by impact fees, grants, special assessments, or revenues other than tax increments. The City does not anticipate making any non -project costs in connection with the implementation of this Plan. Piroject Rlan TID No. 30 Cireatlion Gity of Oshkosh ul imi tied by Ehlleirs Wage 23 dully 27, 2016 August 11, 2016 Darryn Burich, Director of Planning Services City of Oshkosh 215 Church Avenue Oshkosh, WI 54903-1130 Dear Mr. Burich: I reviewed the project plan for, City of Oshkosh Tax Increment District # 30 Washington Building pursuant to Section 66.1105(4)(f) of the Wisconsin Statutes. I find that the plan includes a statement listing the kind, number, and location of proposed public improvements. It also includes an economic feasibility study, a detailed list of estimated project costs, and a description of the method of financing all estimated project costs, the time when the costs are to be incurred, and a list of estimated non -project costs. The plan contains maps of existing uses and conditions of real property, as well as, proposed improvements and uses. The plan shows any proposed changes in zoning of the real property in the district, and any proposed changes in the City's master plan, map or other municipal codes required or proposed as part of the district. The plan includes a statement of the proposed method for relocation of any persons to be displaced. The plan further shows that the district will promote the orderly development within the City, which is consistent with the City's Comprehensive Plan (Master Plan), building codes, and other city ordinances in relation to project elements. Upon adoption of the project plan by the Plan Commission and their submission to the City Council, all requirements of Section 66.1105(4)(f), Wisconsin Statutes, shall be complete and it is, therefore, my opinion that the project plan attached hereto is complete and complies with Wis. Stat. § 66.1105. Sincerely, CITY OF Lynn F. Lo?i City Attorney LL/ah City Attorney City Hall, 215 Church Avenue P.O. Box 1 130 Oshkosh, Wl 54903-1130 920,236.51 15 http://%A,,wv.ci.oshkosh %ovi.us Page 24 Exhibit A: Calculation of the Share of Projected Tax Increments Estimated to be Paid by the Owners of Property in the Overlying Taxing Jurisdictions Project Ran TID No. 30 Ciraahon Gity Of Oshkosh ubirnutted by Ehlleirs Page 25 Tally 27, 2016 . .. ..... . . Statement of Taxes Data Year: Percentage Winnebago County 19.73% City of Oshkosh s 41.67% Oshkosh Area School District 34.63% Fox Valley Technical College 3.97% Total Fox Valley Winnebago Oshkosh Area Technical Revenue Year County City of Oshkosh School District College Total Revenue Year 2018 4,413 9,319 7,745 888 22,365 2018 2019 4,486 9,473 7,873 902 22,735 2019 2020 4,560 9,628 8,002 917 23,108 2020 2021 4,634 9,785 8,133 932 23,484 2021 2022 4,709 9,944 8,265 947 23,865 2022 2023 4,785 10,104 8,398 963 24,249 2023 2024 4,861 10,266 8,532 978 24,637 2024 2025 4,939 10,429 8,668 994 25,029 2025 2026 5,017 10,594 8,805 1,009 25,425 2026 2027 5,096 10,761 8,943 1,025 25,825 2027 2028 5,176 10,929 9,083 1,041 26,229 2028 2029 5,256 11,099 9,225 1,057 26,637 2029 2030 5,337 11,271 9,367 1,074 27,049 2030 2031 5,419 11,444 9,511 1,090 27,465 2031 2032 5,502 11,619 9,657 1,107 27,885 2032 2033 5,586 11,796 9,804 1,124 28,310 2033 2034 5,671 11,975 9,952 1,141 28,739 2034 2035 5,756 12,155 10,102 1,158 29,172 2035 2036 5,842 12,337 10,254 1,175 29,609 2036 2037 5,930 12,521 10,407 1,193 30,051 2037 2038 6,018 12,707 10,561 1,211 30,497 2038 2039 6,107 12,895 10,717 1,229 30,947 2039 2040 6,196 13,085 10,875 1,247 31,402 2040 2041 6,287 13,276 11,034 1,265 31,862 2041 2042 6,379 13,470 11,195 1,283 32,326 2042 2043 6,471 13,665 11,357 1,302 32,795 2043 2044 6,565 13,862 11,521 1,321 33,269 2044 146,997 310,408 257,988 29,573 744,966 Notes: The projection shown above is provided to meet the requirements of Wisconsin Statute 66.1105(4)(i)4. Project Ran TID No. 30 Ciraahon Gity Of Oshkosh ubirnutted by Ehlleirs Page 25 Tally 27, 2016 Appendix A Tax Increment Financing Application r -F-1 iLax Incremental 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: 1. Applicant Infonnation 2. Project/Property Information 3. Project Narrative 4. Project Budget/Financial Information 5. Buyer Certification and Acluiowledgement. 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 Incremental Financing Policy' document. Legal Name: Discovery Properties, LLC Mailing Address: 230 Ohio St #200, Oshkosh W1 54902 Primary Contact #: 920 230 3802 E-mail: mgoudreau@discovery-properties.com Attorney: Jason Hirschberg: Cell #: 920 379 9989 FAX #: 920 426 4606 Legal Entity. Individual(s)- Joint TenantsTenants in Common_ Corporation LLC X 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 corporatioii/parttiership/LLC and extent of ownership interest. Name: Address: Title: Interest: Mike Goudreaui 230 Ohio St #200, Oshkosh W1 54902 co-owner Randy Schmiedel 230 Ohio St #200, Oshkosh W1 54902 co-owner 50% 50% 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 X If yes, give the naive 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 X If yes, please furnish details: Page 26 Date: 6/1/2016 RE: Summary Letter 105 Washington Ave. TIF Application C/O: Mark Rohloff City Manager - Oshkosh, WI 215 Church Avenue Oshkosh, WI 54903 Dear Mr. Mark Rohloff. We humbly submit for your review a project that we believe will significantly contribute to the downtown revitalization efforts and hope that the community might view this project favorably enough to utilize Tax Incremental Financing to help bring this project to fruition. We are proposing to renovate the semi -abandoned Washington Building, located at 105 Washington Avenue, into 20 new high-end apartments. In addition, we propose to acquire a portion of the city -owned parking lot adjacent to Out- building so that we can provide 20 garage units as well as recondition and landscape the entire parking lot, including a large portion that the city would retain for public use. This historic renovation and updating of public space will serve to remove blight and repurpose a building that has significantly fallen Out Of use due to Substantial deferred maintenance and hope that you will support out, efforts. Name of Developer & Owner: Discovery Properties,, LLC ( Mike Goudreau and Randy Schmiedel Co -Developers / Co -Owners) Description of Site/Building: The Fraternal Reserve Association Building consists of 29,100 Sq. Ft. of vacant office space and sits on a parcel of roughly 10,424 Sq. Ft. located at 105 Washington Avenue. The adjacent pat -king lot to the South is roughly 31,400 Sq. Ft. Current & Proposed Uses: The most recent use was as office space however has sat vacant the past several years. We are proposing to turn it into market -rate apartment units. Description of End Users: With our planned high-end finishes and price -points, we are anticipating possibly young professional or more mature tenants or enipty-nesters that might be looking to downsize from home ownership arid take advantage of all the amenities vibrant downtown living has to offer. Project Start & End Dates: Deconstruction and some construction efforts have already begun. We are anticipating a late fall early winter 2016 completion date. Description of Public Benefit (Job Creation): The Full-time professional residents Will Support downtown business expansion and contribute positively to our Urban Revitalization efforts, The multi -million -dollar redevelopment costs will bring immediate impact to construction revenue in Oshkosh providing for dozens of local businesses and families in 2016. Overview ol'Private Sector Funding and Total Development Costs- Choice Bank will be Our private financing partner for the project providing a $2,025,000 loan, An as of yet to be determined private equity partner will provide an estimated $723,000 and receive the benefit of the historic tax credits. Finally, Discovery Properties will make a capital investment in the amount of $1 million to cover the roughly $3.8 million total project development costs.. Summary of Increment Projections and TIF Assistance Requested':: Over the next 26 years, we estinnate $628,144 of additional tax increment to be generated by this project. We are requesting the full 75% of the increment, or $471,858, as a PayGo note to be paid Over the Course of the 25 -year payback period. The 'But For' Provision: The Washington building is listed on the National Park Service's Register of Historical Places. As a historical preservation project, significant additional expenses have been identified to accommodate unique reqUirCrMlItS to maintain as much of the historical fabric as possible. While we will be obtaining tax credits that will help in offsetting these costs, without TIF assistance we estimate that this project would yield a -13.68% 10 -year internal rate of return. Even with the TI F assistance requested, the 10 -year internal rate of return is only -4.22%. We initially undertook this project believing the historic tax credits Would be enough to help overcome the increased cost of renovating an old building. However, after' deconstrLICtion, we have now found that this is no - Page 27 where near the case in this project. While we both are thankful that this community has aided our efforts to grow a thriving business enterprise, and while we both believe in the central city revitalization efforts this project exemplifies and in maintaining historical buildings, we have come to realize that we will be taking a loss on this project even with TIF assistance. However, we seriously question whether we can continue to move forward without TIF now that we fully understand the total development costs. Again, we strongly feel that with the City's collaboration, together we can move forward with this project that benefits the entire city, Please feel free to contact me with any questions or clarifications that might be needed. Best regards, Mike Goudreau 28 lax Incremental Financing Policy and Application Overall Project Summary and Objectives: Renovation of the Fraternal Reserve Association Building located at 105 Washington Ave from a roughly 29,100 sq ft vacant commercial office space to 20 high end residential apartment units. In addition we will acquire a portion of the city owned lot on which 20 new garage units will be constructed. The lot will be repaved and substantial landscaping will be installed. The city will retain approximately 28% of the refurbished lot for public use. Current and Proposed Uses: The building most recently was used as office space however sat vacant for the past several years failing into foreclosure. The building will be renovated into 20 high-end apartment units. The city - owned lot has been used for public parking. Roughly 72% of the lot will turn private and house garages while the remaining portion will stay public parking. Description of End Users, The high-end finishes proposed along with unique views and close proximity to a host of downtown -amenities are likely to draw young professionals or possibly near to retirement individuals looking to potentially downsize or get out of the responsibility of home ownership. Property Summary: Parcel/Land Area: 41,814 SF BuildingArea.. 29,100 SF # of DwellingUnits: 20 # of Stories. 5 # of Parking Spaces: 31 & 20 Garages Describe any zoning changes that will be needed: Proposed use is consistent with present C-3 zoning Identify any other approvals, permits or licenses (i.e. Liquor License, Health Department, etc): None Describe briefly what the project will do for the property and neighborhood: With fiber broadband connections & a modern urban feel, we feel this space will be uniquely positioned to draw professionals from many of the downtown businesses such as DealerSocket, 4 Imprint and Silver Star brands to become residents of our downtown fabric. Full-time professional residents will support downtown business expansion and contribute positively to our Urban Revitalization efforts. 29 foffl% 0 0 lax Incremental Financing Policy and Application Project Timetable Date Final Plan/Specification Preparation: MaY15 Bidding and Contracting: May 30 Firm Financing Approval- June 10 Construction/Rehabilitation: Aug Landscaping/Site Work-, July - Aug Occupancy/Lease Up: Sept Development Team Developer: Mike Goudreau and Randy Schmiedel Architect: Excel Surveyor: Martenson & Eisle Contractor: _RIS Design Other Members: Describe Team expertise and experience in developin, imilar projects: Discovery Properties owns over 90 rental properties in ushkosh. Mr Goudreau and Mr. Schmiedel recently were involved with the Riverfront senior apartments along with numerous other developments in Oshkosh. Other current Team projects in development: Currently considering other development opertunifies Financial ability of the applicant to complete the project: 100% Full and part-time jobs to be created by the proposed project including estimated salary: This development is likely to create an additional 0.5 FTE for management of the property and another 0.5 FTE for the maintenance and general upkeep, 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. Ilie property must be valued assuming that the highest and best use is the proposed use. 30 ? M 0 iax Incremental Financing Policy and Application Sources and Uses of Funds Identify the sources of funds used to finance the project. Typical sources include equity; tender financing, mezzanine financing, government financing, other anticipated types of public assistance, and any other types or methods of financing. Uses of Funds Amount ($) $ per SF of Building Area Land Acquisition. $214,399 $7,37 I SF % Demolition: $108,200 $3.72 SF Environmental Remediation: $31,000 $1.07 SF Site Clearance and Preparation: $30,000 $1,03 SF Soft Costs/ Fees: $59,1,557 $20.33 / SF Soft Cost Contingency: $40,000 $1.37 / SF Hard Construction Costs: $2,873,935 $9&76 SF Total Project Costs: $3,889,091 $133.65 SF Sources of Funds Equity Developer Equity: $1,033,788 Other Equity:( HTC Equity investor ) $742,845 Total Equity: $ Loans Construction Financing: Permanent Financing: TIF Assistance Other: ( City Lot Reconcilliation Total Sources of Funds Financing SourceAmount Equity: Discovery Properties Loans 1: Choice Bank 2: 3: 4: Rate $2,025,000 — 4.5 $ 471,858(paygo) $87,458 $3,889,091 % of total project costs 26.6 % 19.1 % Term % MOS. % 25 yrs. 52.1 % (12.1) 2.2 % 100% Terms: Years/Interest Contact Information Cash mgoudreau@discovery-properties.com 25 vears (a) 4.5% 31 920-267-8050 -tax Incremental Financinig Policy and, Application Detailed Pro Forma (must correspond to line items for Uses of Funds on previow page) Land Acquisition $214,399 Demolition $108,200 Site Clearance and Preparation Infrastructure $ Utilities/removal $ Utilities/relocation $_30,00O Utilities/installation $ Hazardous Materials Removal $31,000 Other( $ Total Site Clearance and Preparation $383,599 Soft Costs/Fees Project Management (_%) $ General Contractor (_%) $ Architect/Engineer (_'Ya) $106,700 Developer Fee (-'/o) $312,004 Appraisal $4,800 Soil Testing $ Market Study $4,000 Legal/Accounting $15,000 Insurance $2,500 Title/Recording/Transfer $5,000 Building Permit $16,821 Mortgage Fees $2000 Construction Interest $56,000 Commissions $ Marketing $ 5,000 Real Estate Taxes $ 10,733 Other Taxes Other Hlistoric Tax Credit Consultants 51,0,00 Other $ Sub -total Soft Costs/Fees $591,557 Soft Cost Contingency $40,000 32 r" jLax Incremental 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 fornias 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 need 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. 'Die 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. 'Ilie reversion at the end of the ten-year holding period must be based on the capitalized Ilth year net operating income. The reversionary value is then added to the loth 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, 33 r" iLax Incremental Financing lei Policy and Application Revenue Projections - Rental Project Reversion in Year 10 Year 11 N01 before Debt 6 Capital Expenses $_140,611 Capitalization Rate 8 % Gross Reversion $1,758,138 34 Year I Year 2 >>Year 11 Income rent per sf (or avg.) $ $ Commercial Rent $ $ Commercial Expense Recoveries $ $ Residential Rent $211,008 $214,608 $247,008 Other Revenue (Garage rent $_?7,600 $28,069 $32,668 Gross Potential Income $238,608 $232,727 $268,209 Commercial Vacancy $ $- $ Residential Vacancy %$11,930 $9,950 $11,467 Effective Gross Income (EGI) $226,678 $232,727 $268,209 Expenses Maintenance & Repairs $17,490 $17,665 $19,320 Real Estate Taxes $,10,733 $31,832 $34,814 Insurance $ 12,00O $_12,120 $13,255 Management Fee $14,520 ,$14,665 __ $16,039 Professional Fees $3,700 $3,737 $4,087 Other Expense ( utilities & trash $29,,040 $29,330 $32,078 Other Expense (advertising $7,210 $_L.282 $7,964 Total Expenses $ 94,693 $116,631 $127,558 Net Operating Income (NC I) $131,985 $116,096 $140,651 Capital Expenses (reserves, tenant iniprovenients, coniniissiotis) $3,000 $_3,030 $3,314 Debt Service $135,067 $135,067 $135,067 Net Cash Flow (before depreciation) $(6,083) $(22,001) $2,270 Reversion in Year 10 Year 11 N01 before Debt 6 Capital Expenses $_140,611 Capitalization Rate 8 % Gross Reversion $1,758,138 34 jLax Incremental Financing 4i Policy and Application Revenue Projects — For -Sale Project Gross Sales Revenue Housing Units Unit Type` Number Total Housing Sales: *a00rdable units if any Housing Unit Upgrades: Price/Unit $ Commercial Space Unit Type Size-sf Price per sf $ Total Commercial Sales: Total Cross Sales Revenue Cost of Sales Commissions % $ Marketing % $ Closing % $ Other Costs ( % $ Total. Costs of Sales % Net Sales Revenue 35 r I" iax Incremental Financing Policy and Application Surninary 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 inforniation 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 • Narne 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 forinat. 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 pat -king 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 "greed' features to be included in the project. All projects that receive TIT assistance are encouraged to include environmentally friendly features. Page 36 rim -tax Increm,ent;al Financing Policy and Application Filing Requirements You must provide all of the following items with your signed application: I. 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. Z. Site Maps: Provide a rnap 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 1 lxl7inches. 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: 1. 1 have read and will abide by all the requirements of the City for Tax Incremental 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. G. The undersigned also agrees to provide any additional information as may be requested by the City after filing of this application, Applicant Page 37 Appendix B Market Study and Investment Analysis Report (Investa-Analytics) 1 *INVISTA ANALYTICS Prepared Exclusively For: Mr. Michael Goudreau and Mr. Randy Schmiedel Discovery Properties, LLC Prepared By: Timothy M Hess, PhD lnvista Analytics, LLC Page 38 member of CONTENTS: Introduction/ Objective..................................................... ................. .,.1 MarketStudy.........................................................................................1 ProjectValuation................................................................................4 LotConstruction Analysis.....................................................................5 OverallInvestment Analysis .................................................................7 PotentialIncome..............................................................................7 Budgetand Funding.......................................................................8 TIFFunding......................................................................................9 OperationalProforma....................................................................11 ReturnOn Investment...................................................................14 Page 39 INTRODUCTION / OBJECTIVE Invista Analytics, LLC (IA) has been engaged to provide a market study of the present rental availability in the downtown Oshkosh neighborhood that might likely serve a demographic that would desire higher -end finishes and amenities summarizing both rental rates and occupan- cies. This infomnation was then utilized to create an operational proforma and investment analysis for the operation of a residential re -use of the Fratemal Reserve Association Building located at 105 Washington Avenue in Oshkosh, Wisconsin. This roughly 29,100 Sq Ft building is listed on the National Park Service Register of Historic Places and as such qualifies this project for Historic Tax Credit incentives. As part of this project, the developers seek to acquire a portion of the adjacent 0.72 acre park- ing lot located to the south of the Washington building which is presently owned by the City of Oshkosh. The developers intend to refurbish this parking lot and add 20 garage units to service the tenants of the newly renovated apartment building. The developers of this project are requesting Tax Incremental Financing (TIF) through the City of Oshkosh. Thus Invista Analytics sought to provide reasoning for methods of valuation for both the existing building and the completed project in order to estimate the potential increment generated. Two different proformas, with and without TIF, were created to evaluate the effect of the potential TEF funding mechanism. Finally, return on investment metrics were calculated on the with TIF and without TIF Investment scenarios. Source of Information In many instances in this report IA was required to seek outside sources of Information including assessment data from the City of Oshkosh, financing terms, capitalization rates, among other metrics. In all cases we sought to document the sources of information and any assumptions used. While much of the information was provided by the developers, these terms should be reviewed to be sure they align with any potential changes the developer may have in securing potential funding. It is also recommended that any reader also perform his/her own investment analysis. This report should be acceptable for external investing and/or lending purposes. Invista Ana- lytics will be available to answer any questions related to these market findings, operational proforma and investment analyses. MARKET STUDY The developers intend to renovate the Washington Building at 105 Washington Ave in Osh- kosh, Wisconsin. Specifically this building will be renovated into four residential units on each of the five floors. To evaluate the rental potential of the residential units, IA acquired the Apartment Data - Q or more Units excel database' from the city of Oshkosh Assessor's File Downloads web page. This data set was then limited to those properties that fell within a 1 mile driving distance of 105 Washington Ave and that had been constructed since the year 2000. After careful inspeo- tion it was noted that both the 900 N Main Apartments, the Anthem Apartments, and the soon to be in-service Beach Building were not included in this file and thus added to our comparison set. The locations of all potential comparable properties found through this search process are displayed in Figure 1 on the following page. Careful inspection noted that properties 1 and 5 are townhouse developments. While these might well compete for potential tenants, the overall living experience was determined to be different enough to not consider these in the determination of potential rent. Property 2 is a low-income housing apartment complex and thus serves potential tenants not similar to the target of the subject property. Similarly subject property 6 is a senior living apartment structure which also would not likely serve the demographic targeted by this development. 1.'htfpJh55aw.a.a5hkosi�.w9.uslassessor/asseis/dain3aadslApartments 4up.Ms' accessed Apni 10, 2016 105 WASHINGTON AVEC INVE=.STIAFNT ANALYSIS Page 40 Figure 1: Potential Comparable Apartment Locations F Ilton A w 1,025 0 W IrVII), ),Ile E hving Ave 3 qi, DMPAVO tD g A W 11,i� kway Ave E Pjtkw,�y Ave X K� 020% Merritt Ave 7 4", WDfiw,�YI;11. Ave 6 rioo I HO goo 4" 'Q Itel z5y Cent" e4ve 41 T'51hAvv, N"S 1.0106 3:: VO I 00s Ave E 10th Av For each of the remaining comparable subject properties an on-line search was conducted to obtain information on the characteristics of the types of offerings, amenities and rental rates for each of the properties. Most of the properties had their own website that contained all of the information needed. Two had the information listed on the third party wabsite, apartments. com. For both the 100 N Main and Anthem properties, a range of rents were given for their room types. In this case we used the middle of the ranges as the 'typical' rental rate. The data generated from this exercise is displayed in the table on the following page:. The data was then submitted to an econometric quantile regression model' that used all of the covariates to predict the rents with the exception of parking. While several of the units offer un- derground parking, the rents used in, the analysis were the base rate which Includes surface lot parking. Thus the model sought to estimate the expected rent at the subject property vAthout the garages that will be available. Given the Beach building has yet to be placed in service, a weighting was applied to each property to carry out the estimation. The Beach building units received a weight of 0.25, while all the other properties, received at weight of 1.0. The resultant model parameters were then used along with the covariate data for the subject property units to arrive at an expected rent for the one, two and three bedroom units to be rented:. The model resulted in estimates of $722, $903, and $1,027 per month respectively for the one, two and three bedroom units. These estimates represent the predicted monthly rent one might expect to pay given the par- ticulars of the units that would be available assuming they are of roughly similar quality as the comparable properties with outside lot parking. The developers intend to secure the adjoining parking lot to the subject site from the City of Oshkosh and build 20 garage units,10 each of single and two car garages to service the subject property tenants. A number of the compara- ble properties offered underground parking for additional fees. The rates are given in the data table on the following page. It was noted that these parking options are leased per stall. 2. Koenker, Roger (2005). QuantiteRegfesslon. Cambridge University Press., MN 0.521 27-9 I INVI,,.',f'A�,ANAI,Y-li(,S.("OM Page 41 Page 42 O V 105 WASHINGTON AVE INVESTMENT ANALYSIS I c c U {+ ° o o Q O U ay C v1 Y C T T c c c V O ap0 R E 60 ° m C « 0 c c c ° C V Q Z C T T T n r3 V a 0 c c c > 111 � w Z C res s omzzz u� E n f0 Ln V r E v 3 a c ° °�' E ° .°max 3 o X o O 3 m N U 41' C sa eQ O p U R N �y 7 a m C! s c > i c i L E c tom' O l9 d n U'4 Y C u Q N C N q 12 C L 12 c ~ Lo : E N 7 � dj U R C0 eJ m N n a �^ C j, c c 7U6 A 4 O12 Na H `�' c c c °c ." a ��r, is r 2 n co 06 is x Q 7 2� + N Q+ Page 42 O V 105 WASHINGTON AVE INVESTMENT ANALYSIS I While this provides security and protection for a tenant's vehicle, it does not provide the poten- tial additional storage that a garage would provide. On the other hand, the detached garage may not provide the same convenience that underground parking provides. After reviewing comparable storage unit facilities in the Oshkosh market, it is recommended that the single car garages be rented at $80 per month and the two car garages be rented at $150 per month. These rents, for both the residential units and the adjacent garages will be utilized in all subse- quent analyses. .3aa1 .1.1 ION ION Any proposed TIF assistance requested from the developers will be subject to the city's 75% rule which states that at most 75% of the net present value of the increment generated by the project shall be made available to the project. To calculate this increment we need both the present (base) value of the building as it exists now and the value of the project upon comple- tion. Base Valuation The present assessed value of the building at 105 Washington is $440,000. While the de- velopers purchased the subject property for $212,000 in May of 2014, this was a foreclosure purchase and therefore not an 'arms -length` sale. Thus we cannot find any substantive reason to use something other than the present assessment of $440,000. Completed Project Valuation To arrive at a valuation for the completed project we employed a modified income approach. With this approach, one simply takes the Net Operating Income (NOI) of a property and divides by the appropriate cap rate to arrive at a valuation. However, when arriving at a valuation for a tax assessment purpose, one needs to factor the property tax out of the NOI calculation or risk running into a circular argument. In this case we factor the taxes out by removing the taxes from the expenses and arrive at an Adjusted NO] via the formula NOI = EGI - (EXPENSE - TAXES). Then the adjusted NOI is divided by a loaded cap rate. Following the assessor's lead from pri- or analyses, we employed a loaded cap rate of 11 %. Data for the effective gross income (EGI) and other values can be found on the Profit and Loss Proforma with TIF on page 12. ._,:'' . Modj[ledincocrie'/�pproa<tifay{ulatlon.:TortlssefsmenlValuat[on... .,.;, ...,,. ;,.,....' Year 1 Year 2 Year 11 Amount Percent Amount Percent Amount Percent EGI 226,678 232,727 268,209 Expense 94,693 41,77% 116,631 50.110A 127,558 47.569€ Taxes 10,733 31,832 34,814 Adjusted N01 142,718 62.96% 147,928 63.56% 175,465 65.42% Loaded CAP RATE 11.00% 11,00% 11.00'% Valuation 1,297,400 1,344,800 1,595,100 Valuation from Taxes 437,457 1,297,400 1,418,947 The year 1 figures would suggest a valuation of $1,297,400 upon completion of the project. Subsequent analyses in this report use this figure. INVISTA-ANALYl-ICS.COM Page 43 LCT' CONSTRUCTION ANALYSIS As previously indicated, the developers are seeking to acquire a portion of the city owned lot, located just south of the Washington building on parcel 0200620000, in order to provide ad- ditional surface lot parking along With detached garage units to service tenants of the subject property. The city will also retain a portion of the lot for public use. However, from an efficiency standpoint, it would seem to make sense that if substantial work is to be done on this lot, that both portions, i.e. that to be acquired by the developers, and the portion to be retained by tile city, be updated at the same time. In what follows we attempt to provide a reasonable attempt at accounting for tile costs and benefits to both the developers and the city. To find a valuation of the potential acquisition of a portion of the lot by the developers we first found some: comparable privately -owned properties with asphalt paving parking lots located on them. The table below provides details on the comparable lots found on the City Assessor's website including square footage and total assessments. Figure 2 below provides a map of the comparable lots along with, the subject property. P" Owner Map Ind parcel Sq Ft Asrnt Asmt/SF Fox River Development 1 0400610000 15,600 39,000 2.500 J West Rentals 2 0401630" 7,440 18,600 2.500 Burns Oregon St LLC 3 0900700000 16,200 41,700 2.574 M & D Enterprises 4 0300890000 13,500 40,000 2,963 Total 52,740 139,300 2.641 Subject Property City of Oshkosh 5 0200620000 31,390 x 2.641 = $82,901 From these comparables we find an, average assessment of $2.64 per square foot. Applying this to the subject property with a total of 31,390 square feet results in a total valuation of $82,901 for the entire lot, Figure 2: Comparable Private Lot Locations o s 1, VilrviilgAve t tfwimj Me E! 411.111 A,c q Z Ike '4,9 9 1, -4p. 6" & wwepsp A'e W 010i W ICO'A�e rJaht'- Page 44 10" ANAI,Y,`flS 10 5 WAS I I IN I )N AVE IN V[�'. . Next we downloaded the GIS image of the lot off of the Assessor's website and loaded the image into CAD. Using the dimensions provided on the image, we calibrated the scale. Inset rectangles were overlayed to calculate the overall area (See Figure 3a on the following page). The total estimated area via this method was 32,160.45 Sq Ft, which was within 2.5% of what was listed on the assessor's data. Moreover, the intent of the use of the image was to find relative areas, thus even though this method found a slightly greater area, so long as the same method is used throughout, the relative areas might all be equally inflated and thus factor out, making the potential discrepancy irrelevant for this purpose. The developers are proposing that the city retain the south east section (red area in Figure 3b) of the lot adjacent to the building located on 300 State Street. Direct access would be provided off of State street along with a shared access from the south off of Waugoo Avenue (green area Figure 3b). The developers propose splitting this shared access evenly with the City. In this case the city would end up retaining 8,944.4 square feet of the parking lot or approxi- mately 27.8% while the developers would acquire the remaining 72.2% of the lot. Using these percentages the value of the portion of the lot that the developers would obtain would then be $59,845. The developers are proposing to repave the entire lot and provide landscaping such that the lot is up to modern engineering standards, including both the area to be retained by the city and the area to be acquired by the developers. IA reviewed the developers costs associated with the project and identified only those cost attributable to the repaving and landscaping. Without the developers fees, this totaled roughly $397,000. To calculate the amount of that attributable to the portion the city will retain, we estimated the total area minus the area of the garages to be built (grey in Figure 3c). Removing this, the city's portion would be 37.1 % of the total area to be completed. Thus the value of the work to be completed on the portion of the lot the city will retain under this plan is $147,276. Under this scenario, white the developers stand to gain from the acquisition of a portion of the land, the costs associated with the completion of the city's portion of the lot results In a net loss of $87,431. The developers are requesting that the City of Oshkosh contribute this amount for the comple- tion of this work. The subsequent analyses assume this will be the case. I INVISTA-ANALY-FICS.COM Page 45 Lot. Valuation and Paving Casts TotatLot city Shared Garages Area (Sq Ft) 32,160.45 6,850.00 4,188.80 8,038.88 Region Biue - Fig 3a Red - Fig 3b Green - Fig 3b Grey - Fig 3c Notes 50/50 split Entire Lot Lot -Garages City Discovery City Discovery Area Retained 8,944.40 23,216.05 8,944.40 15,177.17 Proportion Area Retained 27.81% 72.19% 37.08% 62.92% Value Retained/Acquired 23,056 59,845 147,276 249,903 Discovery Net Loss 147,276 - 59,845 = $87,431 The developers are proposing to repave the entire lot and provide landscaping such that the lot is up to modern engineering standards, including both the area to be retained by the city and the area to be acquired by the developers. IA reviewed the developers costs associated with the project and identified only those cost attributable to the repaving and landscaping. Without the developers fees, this totaled roughly $397,000. To calculate the amount of that attributable to the portion the city will retain, we estimated the total area minus the area of the garages to be built (grey in Figure 3c). Removing this, the city's portion would be 37.1 % of the total area to be completed. Thus the value of the work to be completed on the portion of the lot the city will retain under this plan is $147,276. Under this scenario, white the developers stand to gain from the acquisition of a portion of the land, the costs associated with the completion of the city's portion of the lot results In a net loss of $87,431. The developers are requesting that the City of Oshkosh contribute this amount for the comple- tion of this work. The subsequent analyses assume this will be the case. I INVISTA-ANALY-FICS.COM Page 45 Figure 3: Lot Area Calculations OVERALL INVESTMENT ANALYSIS Potential Income We first document the expected maximum revenue assuming the building and the garages are at full occupancy. The table an the following page utilizes the predicted rents for the apartment units and garages along with the number of each. In total the developers could: anticipate a maximum annual income of $238,608 assuming these rents and full occupancy. 105 WASI IINGTON AVE INVES'l WJ4 1, ANAI-WSIS I Page 46 Maximum Rental lk6f.1le Potentlal Unit Type No Units Ave Rent/Mo Subtotal 1 Bed/1 Bath 4 722 2,888 2 Bed/1 Bath 14 903 12,642 3 Bed/1 Bath 2 1,027 2,054 Subtotal 17,584 Garage Units No Units Ave Rent/Mo Subtotal 1 Car 10 80 800 2 Car 10 150 1,500 Subtotal 2,300 Monthly Total $19,884 Annual Total $238,698 Residential Annual $211,008 Garage Annual $27,644 Data published by the CoStar Group on multi -family vacancy rates over the past five years in Oshkosh shows a general downward trend with rates in 2010 as high as 5.17% in the fourth quarter, while the fourth quarter of 2015 was 3.08%. The five year average was 4.1% during this period. Budget and Funding Next we look at the detailed budget and sources of income. The table on the next page lists all expected expenses separated out for the building and the parking lot/garage component of the project. The columns labeled TIF and HTC represent an indicator as to whether each expense is allowable for reimbursement for either the TIF funding mechanism or historical tax credits. Note the historic tax credits are only applicable to the building costs while the TIF can apply to both components of the project. We employed the Wisconsin Housing and Economic Develop- ment Authority's criterion for allowable expenses for the TIF basis estimation. Total expenses for the project reach a little under $3.9 million. Of those, approximately $2.44 million are allowable expenses for historic tax credits and $3.29 million are allowable TIF expenses. On the funding side, the developers have secured a funding commitment from Choice Bank in the amount of $2.025 million. In addition, the developers plan to sell the tax credits to raise initial capital to fund this project. To estimate a value of these credits we spoke with 2 tax credit brokers. Vickie holland, with Dimension Development, LLC based out of Madison, WI, suggested a good estimate if the de- velopers were to bring in an equity partner would be 93 cents on the dollar for the federal cred- its and 60 cents on the dollar for the state credits. These estimates were confirmed by Donald Bernards, CPA and tax credit broker with Baker Tilly, again based out of Madison. Using this estimate of value, we estimate the tax credits to be worth $742,845. With the city contributing towards the lot build -out, the developers will then bring $1,033,788 in cash to complete the project. INVISTA-ANALYTICS.CON Page 47 TIF Funding We assume that the project will be completed by November 2016 and that the assessor will apply the new assessed value before the first of the year, 2017. Thus the full value of the project will be on the 2017 tax year assessment and the Increment can be paid out in the fall of 2018. We assume the assessed value will increase at a rate of 1 % per year and that the base value will be $440,000. Thus over 25 years of proposed payout, the total increment will be $629,144. Applying the 75% rule the total note from the city due to the developer would be in the amount of $471,858. With a 2.05% interest rate, this note can be paid down over 25 years. (See TIF Nate payoff schedule on the following page.) 105 WAS[ IINGTON AV[-'INVE3TMf'NT ANALYSIS Page 48 Detailed Project Budget <- Ount Building Parking Lot Combined TIF HFC Notes Ac u€sit€on&site pre Land Acquisition 214,399 Demolition 108,200 1 1 Utilities/relocation 30,000 1 1 Hazardous Materials Removal 31 OW 1 1 Subtotal $383,599 $0 $383,599 Soft Costs Fees General Contractor I 1 GC built Into Hard Costs Architect/Engineer 76,900 29,800 106,700 1 1 Developer Fee (10%) 240,682 71,321 312,004 1 1 WHE0Aallows 12-15;5 Appraisal 4,800 4,600 Market Study 4,000 4,000 Historic Tax Consultant 51,000 51,000 Legal/Accounting 15,000 15,MO Insurance 2,500 2,500 Title/Recording/rransfer 5,000 5,000 Building Permit 10,821 6,000 16,821 Mortgage Fees 2,000 2,000 Construction Interest 56,000 56,000 1 1.19M @ 3.95 for 6 mo Marketing 5,000 5,000 Real Estate Taxes 10,733 I0,733 1.25 3/16/15-6/10/16 Soft Cost Contin en 40000 400011 Subtotal $524,436 $107,121 $631,557 Hard Costs HTC Allowable 1,887,372 1,887,372 1 1 HTC Non-Allowab!e 273,350 713,21a 986 563 1 Subtotal $2,160,722 $713,213 $2,873,935 Total Project Costs 3 068 757 $820 334 $3,889,091 Hist Tax Credit Allowable Costs 2,443,570 TIF Allowable Casts 3,292,639 "-.Source of Funding Permanent Financing 2,025,000 2,025,000 Choice Bank Proceeds from HTC Sale 742,845 742,845 Lot ReconcfMatfon Funds 87,458 87,458 From City of Oshkosh Other Cash Funds 300 911 732,876 1,033,788 Cash from Developers oto t of unds 3 068 757 820 334 88 1ii TIF Funding We assume that the project will be completed by November 2016 and that the assessor will apply the new assessed value before the first of the year, 2017. Thus the full value of the project will be on the 2017 tax year assessment and the Increment can be paid out in the fall of 2018. We assume the assessed value will increase at a rate of 1 % per year and that the base value will be $440,000. Thus over 25 years of proposed payout, the total increment will be $629,144. Applying the 75% rule the total note from the city due to the developer would be in the amount of $471,858. With a 2.05% interest rate, this note can be paid down over 25 years. (See TIF Nate payoff schedule on the following page.) 105 WAS[ IINGTON AV[-'INVE3TMf'NT ANALYSIS Page 48 0 0 3 o w o ap i o r VV N a ri to s E vNe q LL ll m FyZ � m d L- L Lci> u Q Ln v O Q p m N N N m ELL E F U o O I iNVI`TA-ANAL_YTIC&COM .0 o N to H of O to m d w n w m" } O O M O H to d 0 N N MO cl tno as M IR Umi rmrr lna a rtwj P V n -i L Gi N W O V oNo [NV tND � G H H H N N N N M M d d d l!1 lA lA la IO to n n m w w tT � W a` N N N N N N N N N N N N N N N N N N N N N N N N N N N d o H w H m N to la N n o m Vl l0 h 4 d a Qt Lo 7 to H n LA d d n 0 w m N M lA o to cr la O a la H to q w m M N 0 0 0 •-� N N M a 111 IA h w m m O N ti N m d N w r- w m H H H H H H H H H H N N N N N N N N N N N a . ' H m N H h N d M a, N H to la N N to lA n M H M M h N h ldr-olla M O rn rrO l0 m 61 to H w N h N h w a d ri N h -L to d m m m n m d Q M M N N N d Oi 61 6i Cd Gd r• f` �D tD vl ul r -I C . - M M N H n N d M lT N H to lD N N la N n M H H m n N h n a y h ll a m w H N N O w d w H M M H m M n vi r, n M m 0 lD w la C w III H tDO n01 O la M ON (a 1 N N n N h N h H up � M t7i Qi 61 61 m m m m h h h to tD m sn m�� M m N N N rti CI U Q C w H to pp M MW V q m M Q V K M n G n m m OHO lHo la Oho al w In m la m to O O m g q V .-+ -t m co In >n a o m H m rn to a Ca .-+ O M lfl fri O W ti W O M to 00 M al 61 M l0 O l0 O v F'� Ql d H m m r m V MN O 61 [� l0 d N 0 w to d N 0 to M H w to N d V V V V d d d M M M M m M N N N N N r4 H H H C � O o J to In la H m Q N m f w h w M N d O O m o H In d to N N GO L M to h O N d1 M i� H to H n m m to m a w to d M N N N O n'1 lc0 (/1 tl 61 M kct O m n a d n H m (nN to q c4 o N la N' N' N N m m � V' a �i M m tp kD k f\ n W w oU Ol tT n v N N N N ry N N N N N N N N N N N N N N N N N N N N Y yG 4 � d>n ul lA Vf lA ul N m m so N L N N m m m N N IA lA N m N lA u f�J G« 6t Q1 01 Qt Ot T T o O1 al Ol a) m m m m of m ql Ql m m al O\ Ul M h r1 n h h 1� f; n h h h h n n n n n r- In In h n n n n n 4 O O O OO O o o o o 0 d 0 0 0 0 ci g o p p O D O o do k F: x w m N o N tD d iA o w a1 d N d m n a w m m to w rs m .� w co v 61 M l!1 h m N N. N la H to H to N m m N 61 hto d N N H H rt w H d h H d n H d w H m w N IA m m lD p� w N la O d �y y g O ri N N N m M m V 7-zi� m Lr1 V - r, m l to lfl l0 rw m m m O O •� O H m m m m M M m m M m m m m m M M M M M M M M M d d 6 G x n f d 1 d d d d d d d d d d d d d V a d V d a a d d d d - ul ✓1 V1 ul Lq Vf to VI N N lA to L'] lA In lA M M SA LA l!1 t11 VI V1 N LA K fT 3 � w � o d w m o o to m w n IN w m N m .-a v n N H vt vF a m v c O n n H w w H w m v m w d to N d o H w o h o to d m vm-t q mwm H�rmoe, Nqq Lqwdpmw om u r; o M a M r- o -t ro M r- rZ & r o r o r?ri m w <r ri r, E W ono m m m m m m m m m a c o c c 0 c H rN-i .-i a ny N o et o o d w m o o o w w rn rn w m N w re d n N H vi vs d m v o o n n H w w H w m v m to d to N v p H w o h o rn d in odmdnalnN mmm Hva+InMNM�nwdoasw om W O r` O m tyl tl M n O w M n N l0 ri l0 c -i l0 N A M oo V ri n- p m H N m m tD n m g H m d la h o5 O N m to ND w N H M It N- M M relrf m M Q V V d d d to to IA to to lA to to to to 6 H H H .-1 r♦ ri ri ri ri r -I r -I r -I ri ri ri' r -i' q n w 61 p H N M d r4 N m m t+] h w Q1 O H N M d m n m pp H N N N N N N N N N M M M M M M M M M M O V d G G w w W �0 �5 w w w t4 w AO u co w w w w w w w to m w w m u 7 7 a 3 Q a a a Q a a Q Q Q Q a a a a a Q a a Q Q a¢¢ Q a e eM v v� to n oo at a H H H H N N N N N N N N N N m m m to m m m m m m d a a a a a a a a m n n to h ISA to N [A [A N N N h m N N lA h h N h h [o N VI N to ON N N N � H H R H N N N N N N M m m m m m d d O O O O O o o o o a a a a a O p p p p 0 0 0 0 0 0 0 0 0 o0 x N N N N N N N N N N N N N N N N N N N N N N N N N N f In to h w tT O H N M d Ifl la n w Ql O H N m d to n w �• H H H H H N N N N N N N N N N M M M M M M m M m m m m q d O O O O O O O O O O O O O In 0 a O g q o p q p O p 0 J N N N N N N N N N N N N N N N N N N N N N N N N N N N N M d N to n m Qt a H N M d lA tb h w 61 H N m d lA tp H H N H H H H rS H H H N N N N N N N d i e a y Page 49 Operational Proforma The operational proforma, both with and without TIF assistance can be found on the following two pages. The following assumptions were used to generate these: • Residential rental income will increase by $15 per month for each unit every year which works out to roughly a 1.7% increase. • Garage rental income will increase by 1.7% per year. • The first year vacancy rate will be 5% and will hold constant at 4.1 % per year thereafter. • Expenses including Maintenance and Repairs, Insurance, Manage- ment Fees, Professional Fees, Utilities and Trash, and Advertising will all increase by 1% per year. • Year 5 of the professional fees has a one-time increase of $3,500 for the close out of the relationship with the equity investor for the historic tax credits. • The first year will be taxed under the present assessment however subsequent years will start at 2.45% of the $1,297,400 value and increase by 1% per year in accordance with the TIF note payout schedule. • Capital reserves will increase by 1 % per year. • Debt service will be fixed over the first 10 years with a 25 year amorti- zation schedule and a 4.5% interest rate offered through Choice Bank. Estimated expenses were arrived by taking averages over the developers rental portfolio in the Oshkosh area. It as anticipated that the proposed development can be run with comparable efficiencies. The proforma with the TIF assistance starts with a negative cash flow in the first two years of in part due to the ramping up of occupancy in the first year and the lack of increment payment. By the third year we start to see positive cash flow. By the tenth year we see a positive cash flow of $23,283. The "without' TIF picture is much more bleak. Under this scenario the developers do not see any positive cash flow until the eleventh year, and even then the returns are modest at best. '105 WASI I1NG1'ON AVEC INVES IVIENT ANALYSIS j Page 50 I Iwvasrn-ANALY] ics.COM Page 51 .4 00 w 00 s{ m m h co a n 00 o a n 00 .i o b o b O dl b D a N , map h b m 00 N a Ln Ll h r L w m o oo N n N d M H N 01 Q M l0 V N n f� M to Ip a m N N V1 V3 H V} a m to N [/� m N Vf M M V} N V> N uV 1A V! N vi N N .i VF N N p 00 N a M h A m a V o h a -i m IH r! O N A d H lD O N dl N O tll N W N 00 a t9 0o H a N OV O n 0o a N ei Oo b b N O b N A M N m Q m N a m N Aa 00 s M tfi n N m lAin M N V! VY N ri N N .-1 m �--� .-� m V} V} Vr V} N V4 N rl to N m N N V) VI N V) Vn VZ a 00 to m O 00 M Ill N h N 00 C� 00 Q m n w n N V M 00 m m A ri m H M ry m N O O mH Oil h O 'O DO C O lh0 N N O N Cil -Z M m m N Q a H M co 00 a N to a •-� h -I m H Vy 1(f pppp m lil O N Vl In ri V1 t .-i M V1 MV. NVT H N IA V1 m N N N N .- co 00 n N a 00 NN O to h h m O b IA W n .i O l!1 a N O aR Ill N m a O M to o to b tp M M h 1, 00 IA CJ1 n O 2 d O T .� N O tl' O1 �-I O0 M N Ill lT3 H n nj N Ilj [r1 Lf1 N A M M N V} H a N H V1 A H e -I M ri N VT VT V} V1 VT N lHM1 4 h Oo 00 o w tT A to m m In 0o h d H b m n 7 O m b b n noa O co no ri a m m .-i N N tfI n v_r vm oo la 00 In m 00 l0 a .io 00 .4 -, W N O N m p Vi 00 M N Ill M O n N N t+5 V1 V Vl V} In m V1 N V/ N V} Vn N m V} M e-1 +N N H VT to m h a a O MN Q N rt a H 00 A tP m h b O N N Q o m tp m N? b A w N r -I t0 00 N h m r1 to N 00 ul to lD M A tl1 b M - tl 4 �' F .} [Il O N N O O oo t+'1 N tl1 R/ O n rf tT f!l lf3 N :C' N M N lh V1 00 N N N A N H m .-1 .i N m N +R Vl -A iR 14 O V) m N 5 iN N 1? V} y J In 00 Ill c -I O N o e! m N In N o0 O t4 h O O m m O Ol m 111 H O vl l0 w N n ri N b A N W ro llIll O d Ln of N % a to d O e} t0 N A d •+ m N N W N rJ tl1 n O A b M W H¢ N' m N tp V N N N N V} N A N V1 b N H m N N 14 M try V) V! V1 V} V1.14 N r4 V V} M N N in d Q-. a 0o N lo b Q e4 o N I O N O W w b e -S n W Ca : O M h W O t0 11 IA 00 N N N h b H N N O a m a Dl *i a A s M til N o o Loll a O ...: a, c -I N Q N 00 N lV M 6 n w M m VI Ili V, 'A N eq m .-I �-i Vf N to YF Vl N lA th ei tY lh M1l N r V1 N l/T w Cta N' m 00 to to m h N N tl H N V V N N O A A rl; 4i N N m N .--t QI ri N w w m M O O O '.' 4j0�0 N N 00 N o h n P, N N a 0'1 61 n n 1` O 0'1 111 N N H VS y sK V} Vl H m H H V} N N V} u1 v? Vh N ei Q Vf M N N H N N oo m to d o Q zn N O t.1 A O ry r1 N o n in o w m to o o ri A t/l m bb A m N Lo M m m to oo vi to n m N M b M m b . t o o b m _: 7 m .a t+i tTi M +: ti ri v ni eT n t6 I: rli tli I? H N N N VF V) l0 N N IA N H M ei H V} N V} VZ V} V? VT V1 M ei M VF M ei .i vy N V) N K N N 0o O O to O 00 o m O O O O o M In tl h m o o Ih O tp O b m m A b a m O N O a -i d n 0 Ill n N 011 b 00 tl t➢ w v 0o H N h O N a m a h V a tl C r[ m Vl O to ei N V! M N H u< N .i .--t e -i '-t V} N VT V} V> N Vf Vf a V1 M VT m Vi N en � E E Q aa C 3 t6 •yCy to O.F H i G 00 N O m OBJ o C w 0/ f0 H ca C w U m C t6 A is Y V Ql N m M U d R Ol a Z t d Y d C 7 vpi Y W C C Ci O N a N a` K y U C _� j tO INO u art ~ C l7 I�u w I Iwvasrn-ANALY] ics.COM Page 51 1U5 WASI IINGT ON AVF INVF STME=NT ANALYSIS Page 52 .+ w co o m h c+ O V M Ol n W 'ct oo " v rn o N 9 tD V} P T h w W V O N N H M M co n LO m co N O O O m M M H l0 m W M O A N N A N T H W T V m t!i V N h A G M M N tl M Nn n N H N 1D N V1 VF Vl Vf V} VT VT H ri ri H N N VR O co N O O h M Ol Ql tl a A H M M co H h O W O N N N M M Q1 N t0 N W to W H w r• W 61 M W l0 N O] N O H Q d M N N H v Ol M Vl H tri n M ul Q m V) A H tD H m H N V) M V> N M Vl N VT N 11 N 11 N V} 44 N Vl Cl co M O M N o Rt m V M A tO h M I$ Ql n M O W V1 {p W M Q6 M N H tD N m N Ql N O O (n H T A O m V N If ko O N N O Gl O } O H ei H O W V N !Il4 H n ui N M to M M M V} n H V1 tD H M H H Vi m Vb V! V} In V! V. N M eA M m N Vy N 90 co A n M co A N O W h h N O w O to A M N n c l vt tD N M Ql o m M m to w w m m n rn W N Q; H h Q o H tD 00 M ry n w n to H A' o w' oro crl r, tr crH r- m N m tri -ti m m N V} w N .-I V! M N .-a m H H vi m +n V• t^ Vl VT V} N m v* m H rl H y N Vy VI V! VY V) h co co O t6 m A >D M o0 M co n a W tD M h tD O m VY v M- 7 0o h M M w to m H N N M M V n O5 W' lO WW LD M {. H e A a } N O M O N cp M N 'n m Or` N Q1 M ll'1 o M M N Vf tD N H Vr M N H m M V! Vl V) V� N V) N rl r! H VT VY V? N y Vi lO W h O M O lA N V N m H W n m n M iy': O N N O O M O N lO W tl W N H tD w N A M LD N W to N LO a M tO M O N O h W 61 O Ol d 00 00 M N vl cr O r, m m A N m V) to N H VT N H M H r-I N m V} V! N VT V1 V} N N N m " W V} VH1 }S 7: QV1 co m O M N ri O w n O q pe m u1 w _] , n N V? tl to M Q1 M tl 09 O m ccH Ln H O N n tl H M N Ln W H to c* H O M L. C. w Vl Qi 7 O M c (!1 .. N N N V} M H H N N H M H H V? M VI VL V/ VT V/ +A N N V} m e4 4 Vl iWA VH} O: :G: Q co N O O V M O N O N O M w O H h O1 i Q p m U! is M O 7 DO W N M +A N h D H N N n V m at W m a n W Ql o Ol M Q O A M 'c : .amu, H al O O O c0 N N ct M Ql h of 'r w Q .i+ N N Vf M � H iA It � H m H M V} N lA V` V1 V1 to VF ai N VT M rc ta h. 3: M W w O Q n n N H V)- L O tf u} M H M O N V tl M ct M tl .--I hN M co pp O h m Q w to w c0 p ri m N M to to n tp H O w %6 oo H N c h tD m h r N V M Qi r` A WW c O r` m Vj q m N V! Q N M H M H H VS N to Vf to VF VT N [A {N 44 �4 M N O M n O N W to O h W O tD Vl R lo O A tD Ill Gl N A tD M N tO M m co �R W H t0 n m N M QI m tO [D O O O O O N N Q m 61 t- c6 t0 M N N N V) V N VT !Il {V H m H H V> N Vl VT V> VF N Vl W H VA m W H H N to VT V4 N V} VI to oo Q 0 m O co O m n 0 0 0 0 M M O h M -, O Q V} O lO 4 to m Ql A tO tT M n N O tl H tl h n Vl A O N m 00 O w tD Ql O p CD O H h. 00 H tD h O N cr M T A Q H M Ill to H N m H N H H H H V} N of Ql M VY m VI V} VL VS V) V! + w O ? Ln E o ec 0 v o u a E U c 4i % IL CJ NN m U K i t4 N N CJ ice- C Z m V L° c w c m� �a aV1 •Y! c �O cc a LL N U 16 V N t6 O u stn j� O a+ �, U O N o_ l7 H 7 X n. Q o d a u AL w w .v°" Z u O 2 1U5 WASI IINGT ON AVF INVF STME=NT ANALYSIS Page 52 Return On Investment In order to calculate the Internal Rate of Return (IRR) we first need to calculate an assumed reversion at the end of year ten. To do this we use the N01 from year eleven and divide by a terminal cap rate. We again follow the lead of the assessor and use the 11% loaded cap rate and subtract off the presumed mill rate of 2.45%, then rounding down (which provides more presumed value) we arrive at a non -loaded cap rate of 8%. This results in a valuation of $2.06 million in the TIF scenario. However after 10 years there would still be $1,471,334 left to pay off on the mortgage. Thus a net reversion of $587,035 is used in addition to the year 10 net cash flow. This leads to a 10 year Internal Rate of Return of -4.22%. A similar calculation With- out TIF leads to an IRR of -13.68%, again, a very bleak prospect for this investment. I INVISi-A-ANALY1'ICS.COM Page 53 ;Return onlneestment Metila With TIF Without TIF Net Cash Flow Reversion Total Net Cash Flow Reversion Total -1,033,788 -1,033,788 -1,033,788 -1,033,788 Initial Cash Outlay Year 1 6,083 -6,083 -6,083 -6,083 Year 2 -965 -965 -22,001 -22,001 Year3 2,067 2,067 -19,288 -19,28 Year 5,098 5,098 16,579 -16,579 Year 5 4,627 4,627 -17,374 -17,374 Yea r6 11,156 11,156 -11,173 -11,173 Year? 14,184 14,184 -8,476 .8,47 Year 17,211 17,211 -5,783 -5,783 Year 20,238 20,238 -3,095 -3,095 Year 10 23,263 587,035 610,298 -410 286,804 286,394 Yr 11 N01 164,670 140,651 Terminal Cap Rate 8.001A 8,001A Gross Reversion 2,058,369 1,758,138 Mortgage Payoff 1,471,334 1,471,334 Net Reversion 587,035 286,804 10yr IRR => -4.22% 10yr IRR => -13.68% I INVISi-A-ANALY1'ICS.COM Page 53 The findings presented herein are based upon the information available and received at the time this report was compiled. Invista Analytics (IA) has taken every possible precau- tion to evaluate this information for its completeness, accuracy and reliability. To the best of its knowledge, IA feels the information and conclusions presented herein are sound and reliable. It should also be understood that normal economic and marketplace conditions change con- stantly. IA assumes no responsibility for information that becomes outdated once this report is written; nor is it responsible for keeping this information current after April 29, 2016. The results presented in this report are the professional opinion of IA and are based on the information available at this time. These opinions infer proper and professional management of the business operation. The opinions also infer that market conditions do not change the information received upon which these opinions are based. IA assumes no responsibility for changes in market conditions. Furthermore, it is assumed that the reader of this report completely understands its contents, assumptions and recommendations. If the reader does not fully understand the contents contained herein, clarification should be sought from Invisla Analytics. Finally, JA assumes no responsibility should the management of the proposed business ven- ture deviate from any recommendations that may have been provided in this report. Any further questions about this report should be directed to IA. Sincerely, Zen— Timothy Hess, PhD INVlgTA ANALYTICS 146 Algoma Blvd - Suite H Oshkosh, W154901 920.203.2177 w wr.invista-a natytics.com 105 WASI IINGTON AVE INVESTMI NT ANALYSIS � Page 54 iNuiSTA ANALYTICS. Page 55 N PLAN COMMISSION MINUTES August 2, 2016 PRESENT: David Borsuk, Ed Bowen, Jeffrey Thoms, John Hinz, Steve Cummings, Donna Lohry, Robert Vajgrt, Karl Nollenberger EXCUSED: Thomas Fojtik, Kathleen Propp STAFF: Darryn Burich, Director of Planning Services; David Buck, Principal Planner; Elizabeth Williams, Associate Planner; Brian Slusarek, Zoning Code Enforcement Inspector; Steve Gohde, Assistant Director of Public Works; Deborah Foland, Recording Secretary In the absence of both the Chair and Vice Chairperson, Mr. Borsuk was appointed Chairperson pro temp. Chairperson Borsuk called the meeting to order at 4:00 pm. Roll call was taken and a quorum declared present. The minutes of July 19, 2016 were approved as presented. (Nollenberger/Vajgrt) I. PUBLIC HEARING AND APPROVAL OF RESOLUTION FOR CREATION OF TAX INCREMENT FINANCING DISTRICT NO. 30 WASHINGTON BUILDING REDEVELOPMENT; DESIGNATION OF BOUNDARIES AND APPROVAL OF PROJECT PLAN TID No. 30 is being created to facilitate and support the historic rehabilitation of 105 Washington Avenue (aka. Fraternal. Reserve Association Building) as an adaptive reuse project from office usage to residential apartments. Specifically, the 5 story 29,100 square foot structure is being rehabilitated to create 20 "higher end" residential apartment units that will rent from $700-$1100. The total project costs to facilitate this rehabilitation are approximately $3.9 million or approximately $195,000 per unit. TIF in this instance is_being requested as a development incentive to facilitate construction of garages on a portion of the adjacent city parking lot (State Street Lot) as well as being used to offset reconstruction of the remaining parking lbt area that will be used for public parking (those actions will require additional Plan Commission and Common Council action as project plan implementation items). Mr. Burich'presented the item and discussed the history of the structure and explained the reason for the creation of the proposed tax increment financing district. He reviewed the subject site and the area to be included witl7tin the district boundaries and discussed the area of the parking lot to be used for the garages for the apartment building and the remaining area which would remain as public parking. He also discussed the downtown apartment products available and explained that no higher end units have been developed in this area. He explained the mixed use structures that provide apartment dwelling units over commercial uses on the first floor in the downtown area Plan Commission Minutes Page 56 August 2, 2016 and reviewed a map depicting the downtown apartment developments and their location. He discussed the quality of the housing units developed in recent years and the reconstruction of the parking lot which will be rebuilt as part of the TIF project, He also discussed project cost expenditures which would be an estimate of $530,000 for development incentives for the life of the TIP and $88,000 for the parking lot reconstruction. He also explained that the reason for the TIF assistance request was to increase the internal rate of return (ERR) which would be close to -14% without the TIF and -4% with the financial incentive. He further discussed the costs to the city to reconstruct the State Street parking lot without the creation of the TO which would be $700,000 and the success of a high end apartment development which is not feasible in this climate without garage facilities. He continued to discuss the benefits of these types of units in this area as it will bring in higher income households into the downtown vicinity which would assist in the revitalization of this area. He reviewed the site and surrounding area as well as the land use and zoning classifications in this area, the TTD boundaries and photos of the subject site. Mr. Thoms questioned if this area was considered to be blighted. Mr, Burich responded that there are two different standards for this determination and that this area was considered to be in need of conservation and rehabilitation. Mr. Thorns then questioned if the area within the TID was all zoned C-3 Central Commercial District. Mr. Burich responded affirmatively. Mr. Thoms also questioned what the City's Comprehensive Plan designated for land use in this area. Mr. Burich responded that the area is designated as downtown or mixed downtown development which includes residential development and is compatible with the City's Comprehensive Plan. l&. Thoms inquired about the negative IRR that would result even after the TIF assistance and why the development incentive was not higher to at least increase the IRR to a positive figure. Mr. Burich replied that it did not appear to be feasible and discussed the values and historic tax credits and that even with financial assistance the developer was not going to be able to achieve a positive ERR figure with this project. Mr. Thoms inquired about what would occur if the Commission recommends approval for the creation of the TID and the developer decides to not move forward with this project. - Mr, Burich responded that the city could look to capture value to reconstruct the parking lot for public use or just not move forward with the TIF at all. Plan Conunission Minutes Page 57 August 2, 2016 Mr. Thoms questioned if there was any thought to utilizing two-story parking garages with both public and private use as the garage concept was taking out more public parking and creating private parking for the apartment use. Mr. Burich indicated that the City did a study and analysis of the parking lot use last year and the average number of stalls utilized was 9.8 on a daily basis which showed the lot was underutilized and there is not the traffic generation in this area to support full use of this parking lot and the remaining public stalls would be adequate for public use. Mr. Thoms inquired if the parking lot was close enough to the riverwalk for it to be utilized for the purpose of access to the riverwalk area. 111x. Burich responded that there were several hundred parking stalls closer to the riverwalk that could be utilized for that purpose and the costs for a mixed use parking structure was too high to be feasible. The Parking Utility also reviewed the proposed change to the lot and was supportive of the change to private use for the portion necessary for the garage units. Mr. Hinz discussed the redevelopment area and if there were any plans in the works for 300/302 Waugoo Avenue as it was part of the TIF district and how this property would be affected by the creation of the distract. Mr. Burich replied that this property was included in the district to balance out the Tali' project and would provide a mechanism to potentially redevelop the site without amending the plan. Ms. Lohry stated that she felt this was a good idea but questioned if it would be conceivable to have some of the parking facilities underground as it would provide a way to create more green space. Mr. Burich discussed the renovations planned for the William Waters Plaza on the tourer of the district which will provide for upgraded green space and that the parking lot reconstruction would require some landscaping features to meet current code requirements. Mr. Bowen inquired if the parking garages on the site have been approved or would the plans need to come back to the Commission at a later date for approval. Mr. Bunch responded that it is not a planned development but the land disposition"would be required to be reviewed by the Commission. Mr. Cummings left at 4:25 pm. Mike Goudreau, 4482 Harbor Village Drive, Omro, developer for the project, discussed the historic designation of the structure and that they purchased it with the -intent to renovate it into apartment units, He discussed the extensive work done to the interior and the high quality of the interior features and that the design of the apartments maintains the integrity of the original structure. He further discussed the challenges presented to the project and that they had anticipated a higher Plan commission Minutes Page 58. August 2, 2016 rate of return however it did not work out. He stated that the type of residents they anticipated to attract such as empty nesters or young professionals. were considered while they completed studies on this development however these potential renters will not be interested in renting higher end apartment units without the garage amenity. Ms. Lohry again questioned if underground parking facilities would be possible. Mr. Goudreau responded that underground parking facilities were too cost prohibitive and discussed the current and future access points to the parking lot and the areas to be utilized for more green space. Dennis Ruedinger,1434 Hazel Street, stated that he was a contractor working on this project and that it was very refreshing to work on such a development as it was not usual to continue to move forward with a project that is not producing positive revenue figures. He continued to discuss the historical feeling of the structure and the need for garages for this development to make it successful. Motion by Vajgrt to approve the creation of Tax Increment Financing District #30 Washington Building Redevelopment and designation of boundaries and project pian. Seconded by Thoms. Motion carried 7-0. if. EXTRATERRITORIAL TWO -LOT LAND DIVISION/CERTIFIED SURVEY MAP AT 940 OLD KNAPP ROAD IN THE TOWN OF NEKIMI The owner/petitioner is requesting a two -lot land division/certified survey map from one existing parcel containing a total of 39.35 acres. Sizes of the proposed lots are as follows: Lot 1= 31.39 Acres Lot 2 = 6.01 Acres Dedicated right-of-way =1.95 Acres Mr. Slusarek presented the item and reviewed the site and surrounding area as well as the land use and zoning classifications in this area. He discussed the purpose of the request and current use of the site and stated that the proposed land division would not alter the existing land use pattern in the area and is consistent with the City's Comprehensive Plan. He reviewed the certified survey map (CSM) and stated that the proposed lots possessed appropriate land area and street frontage. Mr. Thorns inquired if there were wetlands present on the site. Mr. Slusarek responded negatively, Mr. Thoms questioned where the dedication of right-of-way would be located. Mr. Slusarek displayed on the CSM where the right -of --way dedication was depicted along both street frontages. Pian Commission Minutes August 2, 2016 Page 59 RESOLUTION NO. 16-02 RESOLUTION DESIGNATING PROPOSED BOUNDARIES AND APPROVING A PROJECT PLAN FOR TAX INCREMENTAL DISTRICT NO. 30, CITY OF OSHKOSH, WISCONSIN WHEREAS, the City of Oshkosh (the "City") has determined that use of Tax Incremental Financing is required to promote development and redevelopment within the City; and WHEREAS, Tax Incremental District No. 30 (the "District") is proposed to be created by the City as a district in need of rehabilitation of conservation work within the meanings of Wisconsin Statutes Section 66.1337(2m)(b).; and WHEREAS, a Project Plan for the District has been prepared that includes: a. A statement listing of the kind, number and location of all proposed public works or improvements within the District, or to the extent provided in Wisconsin Statutes Sections 66.1105(2)(f)l.k. and 66.1105(2)(f)l.n., outside of the District; b. An economic feasibility study; c. A detailed list of estimated project costs; d. A description of the methods of financing all estimated project costs and the time when the related costs or monetary obligations are to be incurred; e. A map showing existing uses and conditions of real property in the District; £ A map showing proposed improvements and uses in the District; g. Proposed changes of zoning ordinances, master plan, map, building codes and City ordinances; h. A list of estimated non -project costs; i. A statement of the proposed plan for relocation of any persons to be displaced; j. A statement indicating how the District promotes the orderly development of the City; k. An opinion of the City Attorney or of an attorney retained by the City advising that the plan is complete and complies with Wisconsin Statutes Section 66.1105(4)(0.; and WHEREAS, prior to its publication, a copy of the notice of public hearing was sent to owners of all property in the proposed District, to the chief executive officers of Winnebago County, the Oshkosh Area School District, and the Fox Valley Technical College District, and any other entities having the power to levy taxes on property located within the District, in accordance with the procedures specified in the Tax Increment Law; and WHEREAS, in accordance with the procedures specified in the Tax Increment Law, the Plan Commission, on August 2, 2016 held a public hearing concerning the project plan and boundaries and proposed creation of the District, providing interested parties a reasonable opportunity to express their views thereon. NOW, THEREFORE, BE IT RESOLVED by the Plan Commission of the City of Oshkosh that: It recommends to the Common Council that Tax Incremental District No. 30 be created with boundaries as designated in Exhibit A of this Resolution. 2. It approves and adopts the Project Plan for the District, attached as Exhibit B, and recommends its approval to the Common Council. 3. Creation of the District promotes orderly development in the City. City of Oshkosh Wisconsin T!D No. 30 Pian Commission Resolution Page 60 Adopted this 16th day of August , 2016. Plan dorUnission Chair IJ �Y ► � � ;4135-k �� Secretary of the Plan Commission City of Oshkosh Wisconsin TID No. 30 Plan Commission Resolution Page 61 AUGUST 23, 2016 16-442 RESOLUTION (CARRIED 7-0 LOST LAID OVER WITHDRAWN ) PURPOSE: APPROVE TAX INCREMENT DISTRICT NO. 30 PROJECT PLAN; DESIGNATE TAX INCREMENT DISTRICT NO. 30 BOUNDARIES; CREATE TAX INCREMENT DISTRICT NO. 30 WASHINGTON BUILDING REDEVELOPMENT IMITATED BY: CITY ADMINISTRATION PLAN COMMISSION RECOMMENDATION: Approved WHEREAS, the City of Oshkosh (the "City") has determined that use of Tax Incremental Financing is required to promote development and redevelopment within the City; and WHEREAS, Tax Increment District No. 30 (the "District") is proposed to be created by the City as district in need of rehabilitation or conservation in accordance with the provisions of Wisconsin Statutes Section 66.1105 (the "Tax Increment Law"); and. WHEREAS, a Project Plan for the District.has been prepared that includes: a. A statement listing the kind, number and location of all proposed public works or improvements within the District, or to the extent provided in Wisconsin Statutes Sections 66.1105(2)(f)1.k. and 66.1105(2)(f)l.n., outside of the District; 3 b. An economic feasibility study; c. A detailed list of estimated project costs; d. A description of the methods of financing all estimated project costs and the time when the related costs or monetary obligations are to be incurred; e. A map showing existing uses and conditions of real property in the District; f. A map showing proposed improvements and uses in the District, g. Proposed changes of zoning ordinances, master plan, map, building codes and City ordinances; h. A list of estimated non -project costs; L A statement of the proposed plan for relocation of any persons to be displaced; j. A statement indicating how the District promotes the orderly development of the City; Page 62 AUGUST 23, 2016 16-442 RESOLUTION CONTD k. An opinion of the City Attorney or of an attorney retained by the City advising that the plan is complete and complies with Wisconsin Statutes Section 66.1105(4)(f); and WHEREAS, prior to its publication, a copy of the notice of public hearing was sent to owners of all property in the proposed district, to the chief executive officers of Winnebago County, the Oshkosh Area School District, and the Fox Valley Technical College District, and any other entities having the power to levy taxes on property located within the District, in accordance with the procedures specified in the Tax Increment Latin; and WHEREAS, in accordance with the procedures specified in the Tax Increment Law, the Plan Commission, on August 2, 2016 held a public hearing concerning the project plan and boundaries and proposed creation of the District, providing interested parties a reasonable opportunity to express their views thereon; and WHEREAS, alter said public hearing, the Plan Commission designated the boundaries of the District, adopted the Project Plan, and recommended to the Common Council that it create such District and approve the Project Plan NOW, THEREFORE, BE IT RESOLVED by the Common Council of the City of Oshkosh that: 1. The boundaries of the District shall be named "City of Oshkosh Tax Increment District No. 30, Washington Building Redevelopment", are hereby. established as specified in Exhibit A of this Resolution. 2. The District is created effective as of January 1, 2016. 3. The Common Council finds and declares that: (a) Not less than 50% by area of the real property within the District is in need of rehabilitation or conservation work within the of Wisconsin Statutes Section 66.1337(2m)(b). (b) Based upon the finding, as stated in 3(a) above, the District is declared to be a District in need of rehabilitation or conservation based on the identification and classification of the property included within the District. Page 63 AUGUST 23, 2016 16-442 RESOLUTION CONTD (c) The improvement of such area is likely to enhance significantly the value of substantially all of the other real property in the District. (d) The equalized value of the taxable property in the District plus the value increment of all other existing tax incremental districts within the City, does not exceed 12% of the total equalized value of taxable property. within the City. (e) The City estimates that less than 35% of the territory within the District will be devoted to retail business at the end of the District's maximum expenditure period, pursuant to Wisconsin Statutes Section 66.1105(5)(b)_ (f) The project costs relate directly to promoting rehabilitation or conservation of the area consistent with the purpose for which the District is created. (g) All property within TID #30 was within the City boundaries as of January 1, 2004. 4. The Project Plan for "City of Oshkosh Tax Increment District No. 30, Washington Building Redevelopment" (attached as Exhibit B) is hereby approved, and the City further finds the Plan is feasible and in conformity with. the master plan of the City. BE IT FURTHER RESOLVED that the CorlTnon Council of the City of Oshkosh hereby approves creation of Tax Incremental Financing District No. 30 Washington Building Redevelopment. Page 64 JOINT REVIEW BOARD RESOLUTION APPROVING THE CREATION OF TAX INCREMENTAL DISTRICT NO. 30, CITY OF OSHKOSH WHEREAS, the City of Oshkosh (the "City") seeks to create Tax Incremental District No. 30; and WHEREAS, Wisconsin Statutes Section 66.1105 requires that a Joint Review Board (the "JRB") shall convene to review the proposal; and WHEREAS, the JRB consists of one representative chosen by the School District; one representative chosen by the Technical College District; and one representative chosen by the County, all of whom have the power to levy taxes on property within the District, and one representative chosen by the City and one public member; and WHEREAS, the public member and JR13's chairperson were selected by a majority vote of the other JRB members before the public hearing was held, under Wisconsin Statutes Sections 66.1105 (4)(a) and (e), and WHEREAS, all JRB members were appointed and the first JRB meeting was held within 14 days after the notice was published under Wisconsin Statutes Sections 66.1105 (4)(a) and (e); and WHEREAS, the JRB has reviewed the public record, planning documents, the resolution adopted by the Plan Commission approving the boundaries of the District and adopting the Project Plan, and the resolution passed by the Common Council approving the creation of the District under Wisconsin Statutes Section 66.1105 (4)(gm); and WHEREAS, project costs benefitting the District are to be made outside of, but within a one- half mile radius of the District, pursuant to Wisconsin Statutes Section 66.1105(2)(f)1.n, as identified in the Project Plan; and WHEREAS, the JRB has considered whether, and concluded that, the District meets the following criteria: 1. The development expected in the District would not occur without the use of tax increment financing and the creation of a tax incremental district. 2. The economic benefits of the District, as measured by increased employment, business and personal income and property value, are sufficient to compensate for the cost of the improvements. 3. The benefits of the proposal outweigh the anticipated tax increments to be paid by the owners of property in the overlying taxing districts. City of Oshkosh of Wisconsin, TTD No. 30 Joint Review Board Resolution Page 65 NOW, THEREFORE., BE IT RESOLVED that the JRB approves the creation of this District. BE IT FURTHER RESOLVED that in the judgment of the JRB, the development described in the Project Plan, the information provided by the City, and the public record and planning documents relating to the District, would not occur without the creation of the District. Passed and adopted this —�� day of 2016. Joint Review Board Representing Winnebago County Oshkosh Area School District Fox Valley Technical College District City of Oshkosh Public Member City of Oshkosh of Wisconsin, TID No. 30 Joint Review Board Resolution Page 66 EXHIBIT C Estimate of Property Project Costs May 4, 2017 Tax Incremental. Financing. :4 Foli"�cy and Appli"D cation Sources, and- Uses of Funds Mentif `typical .Y th6sources of fimds; used to finance the project.. T .1c .. spq"rcq$,.mcAude:equity, lender financing, mezzanine financi% government financing, -other ant icipated-lypes of Dublic assistance an&any9thex types or methods of Miancing. Uses of Funds Amount M $ per Sly ,oftullding Area Lp.p4.AcqWsJt1.on-. . DeMolition., $214,39,9.. X1.08,200 V.37 / SF $3.721 SF 'Environniental'Remediatiom $31;000: $1.07/15F Site ,ftitnce:.qhd.P.r p4r4tion: -$30,000 SF Sot Obsts! NO$: Soft Cost Contin gency-.. $40,400 $1.37 CSF 'Hard CWWrtictioh Costs: $218.73j935 $98:76 1 SF Total Project Costs.. tj33.66 FSF Sources of Funds %n -of to"tal ptol'ect.od$ts; -Equity I)eveloper Equity: $ ot..h.er Eqtiiq.( HTC Egulty i�ypstor) $742,845 10:1 Total Equity: % LOMIS Rate Terin $ % Permanent Financing- 2,025,0.00 4.5%) 26 yrs. 52.1 TIF Assistance $ 471,85atpay9q) (12J Other; (di Lot Reconclili'afion) $87,458 :2.2 Total Soo=6 of Ainds. $3,889,091 -10 0 0/0 Financing SouirceAluount Tprms, -kearsl1n.;epbst Contact Information Eqiiliy;. WCOYHY Properties Lash mgoudreau@dlscovery-propettle!§.Gai-6 Loans 1: th6lo&BaoX 25 years' :@ 4,50% 920'207-80 0 4- 31 Tax Incremental Financing Policy and Application D6tilled,'Pro Forma (mustcorrespond to 44C items for Uses. of Finds qn previous page) Land Acquisition Demolition Site Clearance.and Weparajion InfrastttXcfure militiesiremovat Utilities helocat I . 0 . n Hazardous:Materials Removal Other( Total Site Clearance and Preparation Soft costslRes General Contractor (.,Yo) Arcbitectffi ' ngihe ' e ' r Developer' Pee Appraisal Soil Testing Market Study U. gal]Ace.bpning Insurance Title/Recording/Transfer Building Permit I: tqrest Commissions. Marketing Real. Estate TUes Othdr Taxes �Ofller (Hfstona T29:Credit Consultants Otho ( Subtotal Soft Costsfflees- Soft Cost Contingency .$114,399 $ ip'209 $AM -00 $ 31.'-Q0Q $383,590 $4.000 $-i.-000 $1.51000 $5,060 16,621 $ moo 10,733 X51,000 - 32 EXHIBIT D Schedulel, Payment Schedule Subject to the City's annual receipt of Available Tax Increment and the terms and conditions of the Development Agreement, the City shall pay to Developer the total Project Increment Surplus received by the City for the prior year: Payment Date Payment Amount November 1, 2019 Available Tax Increment for 2018 November 1, 2020 Available Tax Increment for 2019 November 1, 2021 Available Tax Increment for 2020 November 1, 2022 Available Tax Increment for 2021 November 1, 2023 Available Tax Increment for 2022 November 1, 2024 Available Tax Increment for 2023 November 1, 2025 Available Tax Increment for 2024 November 1, 2026 Available Tax Increment for 2025 November 1, 2027 Available Tax Increment for 2026 November 1, 2028 Available Tax Increment for 2027 November 1, 2029 Available Tax Increment for 2028 November 1, 2030 Available Tax Increment for 2029 November 1, 2031 Available Tax Increment for 2030 November 1, 2032 Available Tax Increment for 2031 November 1, 2033 Available Tax Increment for 2032 November 1, 2034 Available Tax Increment for 2033 November 1, 2035 Available Tax Increment for 2034 November 1, 2036 Available Tax Increment for 2035 2 May 4, 2017 November 1, 2037 Available Tax Increment for 2036 November 1, 2038 Available Tax Increment for 2037 November 1, 2039 Available Tax. Increment for 2038 November 1, 2040 Available Tax Increment for 2039 November 1, 2041 Available Tax Increment for 2040 November 1, 2042 Available Tax Increment for 2041 November 1, 2043 Available Tax Increment for 2042 November 1, 2044 Available Tax Increment for 2043 The amount payable to the Developer will be ninety percent (90%) of Available Tax Increment. The total amount may vary based upon final costs, assessments, increment, and contribution adjustments. However, the parties estimate as of the date this Agreement is executed that the City's contribution to be $566,000.00 over the life of the District. May 4, 2017 EXHIBIT E Projected District Revenue and Expenses See attached May 4, 2017 _O LL C13 U U N 00 m O H N M It M M N m m O r I N m a M 0 N co m all •( m �0 `m tiI N NN NNN NNNNMmmmMMm mmmvd"a It a0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 o a a 0 0 a aP� 0 0 0 Y N N N N N N N N N N N N N N N N N N N N N N N N N N =FS N N F mwwwwaM aoori mr,amwo tq -��na a Ma00I mr MNri moo NamrnaNtn0a v c a to a In a m o m 0 N ri m M m 0 0 N N a v N U 00r r, mmvi ri cd N r; N 11 ri oria d n dN c c m O m m 00 00 M N N W U M 0 a a m N N ri -0 :F a o 0 0 0 0 0 a 0 0 0 0 0 0 a 0 0 0 0 0 0 0 0 0 0 o=R M a m m co � N 0 m m tD U 0 o o a a o o a a o 0 0 o o 0 0 0 o 0 0 0 0 0 0 0 o'® M m r N ri m � m m s= Q o 0 M M ro a M m N m M M m N m M M a m N m ri N N N N to o o ri C1 O O M M a 00 00 a M N N N N M a YJ 00 .-i M N O M m a O tO N O j O n rn N ri a 00 N 1i1 O a o0 N n a o0 m N -1 tO O a m a 00 M m o0 rJ N N' m m M a' a in m M w ko n n A m o0 as' ni O a O -I ri N 1� o Q31 m N N N N N N N N N N N N N N N N N N N M M M M M M n 0 0 0 0 0 o a o a olo 0 0 0 0 0 0 o a a a a a a a o 0 o ri -+ ri ri ri r -i r? ri r -i ri ri ri ri r -i ri ,-i ri r i r -i ri ri ri ri ,-r ri ri � C O C W O U � C � C a m U O a Q �� ri [t N H kD N m N LO LD N M N 0 ri N M M N W V m M N N LO W M M M M M M W W rh N M m 0 0 C C M l0 N 07 Ori n ri N m a M IR N 00 m O r N N m to 7 uiv v Mui�� ri�viwtDL6 Ls NNN N E -a CL �} H r -I M m N CO N m m N 00 N m [} N Cr m 1' M N N N N kO N M M" m 00 rA N M 00 N N 00 m .-s m M N o V m a a W N m 01 C N O Tt ob ri a N O m m N' M [n N M 00 N o0 v m a o0 M O' Lr 1D ko I, EA N 00' 00 co 00 mcr ofO ri' W mai O'O' 0) NH H N H N H r1 N ri N rf N N N N N N N M m m J O O M M co G} M m rA m M M m N m M M o m N m ri N N N N w M m O O LD M O 00 to a M N N NN M a M c -i M N O M m a 0 W N m W y o o m N ri a Cd N ID O a o0 N O V o0 m rl ti tL n a a a a0 m N N 3 00 rA N' N m' m m' V'r w w M tD LS N n N M a0' m m 0 a O eA H N N m F' E 00 p > 00 00 LL U 0 N � � m L � � `6 Q M M 06 d M m N m M M m N m M M o m N m .-i N N N N W M m '^ w m a 0 (D a M N N N N M a tO 00 ri M N O M m a 0 W N m W C m N r 00 N 11 O a 00 N f0 O d 00 M N qlU 0 d' m (} CO M N N N r, Nd m m g M m M w SD r N N 00 w m m 0] o n e-1 r? N N m m E N N N N N N N N N N N N N N N N N N N m m m m m m m M c rmo N N o0 m 0 ri N M a M I M N 00 41 O 1 ri N m am I 1D N co i N m 0 rm jp W Hr H ri N N N N N N N N N N m M m m M M M m m M V '4 V d .• 11 O O O 0 0 0 0 a 0 0 0 0 a 0 0 0 0 0 0 0 0 a 0 0 0 0 0 0 0 0 Y N N N N N N N N N N N N N N N N N N N- N N N N N N N N N N F 0 L CN Q O ,; (6 CL 0 (13 CD CDU CO O ZZ CD UJ a a� 1+J EXHIBIT F 10 Year Internal Rate of Return (IRR) May 4, 2017 ft EHLERS LEADERS IN PUBLIC FINANCE 19 August 2016 Mr Mark Rohloff City Manager City of Oshkosh 215 Church Ave Oshkosh WI 54901 RE: 105 Washington Avenue Redevelopment Dear Mr. Rohloff, Further to our several conference calls, and per your subsequent request, Ehlers was asked to review and perform an analysis on the following information provided in the Developer's completed Oshkosh TIF application for the 105 Washington Avenue project: ■ Brief description of project (conversion of historic 29,100sf building into 20 apartments with 20 garage stalls in parking lot) and rationale for same; ■ Request for partial purchase of City property with City participation to include $87K City reimbursement for the Developer's cost of parking lot renovations for the City (2.25% of total cost); ■ Developer's sources/uses of funds —Total cost $3.889mm; Developer equity $1.033mm (26.5%), and assumed sale of Historic Tax Credits (HTC) netting $743K (19.1% of total); ■ PAYGO TIF request for net $471,858 receipts as increment is achieved (TIF is not monetized, so no corresponding debt is reflected). ■ Developer's revenue and expense projections — Net Cash Flow to Developer Year 11 is just $2,270 with no TIF assistance, and is $26,289 with TIF. Also included with the information was a third -party analysis by Investa Analytics evaluating costs and returns, including a recap of new HTC funds and further detail on the assumptions. The following are some of the conclusions of reviewing the Investa projections: 1) TIF Receipts are included "above the line" in the NCI calculation, thereby inflating reversionary value and IRR; 2) Value (with TIF included in N01) and 10 year IRR (Year 11 N01 used in reversion) are $2.058mm and (4.22%) respectively, i.e., negative return. Value is 53% of cost; 3) Value (w/o TIF) and Year 10 IRR are $1.758mm and negative (13.68%). Value is 45% of cost. See Ehlers Review below for additional comment; 4) Cap rate 8.0%. EHLERS REVIEW: I reviewed the information noted above, including spot-checking the Investa calculations and projections. This information was then included in our template to evaluate for adequacy with and without TIF assistance. In our evaluation, the TIF participation was reflected "below the line" as 1 -800 -56? -1171 1 wvnv.ehlers-inc.com EHLERS LEADERS IN PUBLIC FINANCE additional Developer cashflow, rather than included in the NO1 calculation. Additionally, our calculations included replacement reserves in the project operating expenses, which slightly reduced NOI. Per the City's TIF application procedures, Year 11 NO1 was used in the reversion analysis. The IRR in either event was negative at (11.05%) with TIF assistance, and (15.15%) without such assistance. The cash -on -cost return was less than 1.0%. Both analyses assumed the $87,458 reimbursement by the City for parking lot renovations was contributed. Additionally, given the upscale finishes and nature of the project and its downtown location, we tested cap rate sensitivity by reducing the rate from 8.0% to 7.0% and also 6.0%. This resulted in IRR's with TIF assistance of (5.73%) at a 7.0% cap, and (1.31%) at 6.0%. Without TIF assistance, the returns are (8.54%) at the 7.0% cap, and (3.45%) at a 6.0% rate. It is noted that no cost of sale (commission) was provided in the Developer's analysis, which would further reduce the ultimate project returns. These commissions are usually in the range of 3-6% of the gross sales price. EHLERS EXCLUSIONS: The information in the Investa report included a fairly comprehensive market comparison for rental rates, resulting in rents ranging from $.85 to $.93/SF. We did not confirm with outside brokers as to rental rates in the downtown Oshkosh market given the time limitations of the engagement, however based on our experience, and review against the competitive set, these rates appear to be reasonable. CONCLUSION: Based on our analysis and the exclusions noted above, the project returns a negative internal rate of return, even with the TIF, City grant, and HTC participation. However, taking into account the project location and finish level which may ultimately provide for increased rents in the future, we recommend incorporating a "look back" provision in your consideration, pursuant to the City's policy. Copies of our base analysis are included with this letter report. Please let me know if you need additional background or information on this matter. Respectfully, Frank Roman Municipal Advisor Cc: M. Harrigan T. Taves EM mm Im ME U 1-800-552-1171 1 www.ehiers-inc.cem Lease Agreement Document Number I Document Title This Lease Agreement, made and entered into this day of April, 2017, is by and between the City of Oshkosh, a Wisconsin municipality, with their principal offices located at 215 Church Ave., P.O. Box 1130, Oshkosh, Wisconsin 54903-1130, ("City" or "Lessor") and Discovery Properties, LLC, a Wisconsin Limited Liability Company, 230 Ohio Street, Suite 200, Oshkosh, Wisconsin 54902 ("Discovery" or "Lessee"): RECITALS Area Name and Return Address Oshkosh City Attorney P.O. Box 1130 Oshkosh, WI 54903-1130 90200620000 Property Identification Number 1. The City owns the following real property ("City Property") that is currently used as a public parking lot: Located in the City of Oshkosh, Winnebago County, Wisconsin, and originally part of Fractional Lot 1 of Section 24, Township 18 North of Range 16 East, and more particularly described: All of Lots one (1) and Two (2), the Easterly 60 feet of Lot Three (3), all of Lot Four (4), and the Westerly 29.2 feet of Lot Five (5), all on Block Twenty-six (26) of L.M. Miller's First Addition, 2nd Ward, City of Oshkosh; And Lot "C" in Papendik's Plat, in the 2nd Ward, City of Oshkosh, per Leach's Map of 1894, originally being a part of Fractional Government Lot 2, Section 24 Township 18 North, Range 16 East. Parcel Number: 90200620000 2. The City is intending to divide the City Property into two parcels through a future Certified Survey Map. One future parcel will be larger than the other. The smaller future parcel will be retained by the City and will continue as a public parking lot. The larger future parcel is intended to be conveyed to Discovery for their use as a private parking lot that will benefit their adjoining redeveloped residential apartment building. Because certain environmental remediation is necessary before conveying this property to Discovery, the larger future parcel will be leased to Discovery before conveyance so that they may begin construction and environmental remediation efforts ("Leased Property"). 1 l 28, 2017 3. The Leased Property is more particularly described as: [insert Leased Property legal description] 4. A map of the Leased Property is attached hereto as Exhibit A for identification and reference purposes only. 5. The City and Discovery have entered into a Development Agreement dated , 2017, and recorded with the Winnebago County Register of Deeds as Document Number on , 2017, for the purpose of Discovery undertaking a redevelopment Project both on the Leased Property (referred to in Development Agreement as the "Property") as well as the redeveloped residential apartments on Discovery's adjoining property. Discovery intends to construct covered parking and other parking -related amenities on the Leased Property that will be for the sole benefit of Discovery's adjoining residential apartment building. A copy of the Development Agreement is not attached to this Lease Agreement, but the parties acknowledge that they read and signed the Development Agreement, retain a copy of it, are familiar with it, and agree to be bound by its terms as it may pertain to the redevelopment of the Leased Property. 6. Environmental remediation is/will be undertaken on the Leased Property by Discovery, and Discovery has chosen to wait to take title to the Leased Property while it performs all necessary environmental remediation actions and begins construction of its private parking lot. Upon receipt of the VPLE Certificate of Completion for the Leased Property, the City will convey the Leased Property to Discovery as contemplated in the Development Agreement. 7. It is in both parties' interests that Discovery begin construction of the proposed parking lot and related improvements on the Leased Property prior to the completion of the environmental remediation, and the purpose of this Lease Agreement is to allow this commencement of construction. The development of the Leased Property may be financed through a "Project Lender." The Project Lender may request and may be granted an interest in this Lease Agreement up to and including the right to purchase the Leased Property from the City instead of Discovery purchasing it from the City. However, any assignment of any Discovery interest in the Leased Premises must be related to this specific development. To further clarify the previous statement, Lease Assignments cannot be part of a financing or security package that includes any property other than the Leased Property. Pursuant to the terms of this Lease Agreement and the Development Agreement, assignments must be contingent with such transfer only becoming effective in the event of a default by Discovery. Any assignment must be more fully described in separate documents reasonably agreeable to the City. All assignments, transfers, and conveyances of the Leased Property will be subject to continuing obligations under this Lease Agreement and the Development Agreement. AGREEMENT 9. All Recitals are incorporated into this Lease Agreement. 10. In exchange for one dollar ($1.00) and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the City agrees to lease to Discovery, and Discovery agrees to accept such Lease for the Leased Property identified and described in this Lease Agreement on the terms and conditions expressly set forth and referenced herein. 2 April 28, 2017 11. The term of this Lease Agreement shall commence on the date it is executed by all parties, and shall end on the earlier of. (a) the date that is fifty years after the date of commencement of this Lease; (b) the date in which Discovery, or a Project Lender as may otherwise be allowed under a Lease Assignment, closes on its purchase of and acquires full ownership interest in the Leased Property; or, (c) the Agreement is terminated. 12. This Lease Agreement shall terminate without notice upon the insolvency of Discovery, upon Discovery's seeking bankruptcy protection, or upon any Discovery creditor, other than Project Lender, obtaining any interest in Discovery or Discovery's property. The City may elect to terminate this Lease Agreement based upon a material default of this Lease Agreement which remains uncured after providing 30 days written notice of such default. 13. Pursuant to the terms of the Development Agreement, Lessee is obligated to take certain remediation actions at the direction of the Wisconsin Department of Natural Resources and others relating to existing hazardous substances on the Leased Property. Discovery shall complete all remediation efforts required by the WDNR and take all actions to pursue a Voluntary Party Liability Exemption ("VPLE") Certificate of Completion for the Leased Property, subject and pursuant to the terms of the Development Agreement. Remediation of the site cannot be completed until construction of the improvements on the Leased Property is completed, and the Leased Property will not be conveyed by the City to Discovery until the issuance of a VPLE Certificate of Completion by the WDNR. 14. Discovery shall close on its purchase of the Leased Property on the earliest practical date after the issuance of the VPLE Certificate of Completion. All parties agree that the timely expiration of this Lease, and conveyance of the Leased Property, is in everyone's best interest and will work in good faith towards that end. The City shall convey the Leased Property to Discovery pursuant to this Lease Agreement and the Development Agreement. 15. There shall be no periodic or other payments due from Discovery to the City for the ability to utilize the Leased Property, other than as may be identified in this Lease Agreement or the Development Agreement. 16. Discovery shall be allowed to construct and operate a parking lot with garages and related improvements on the Leased Property for the benefit of its adjoining residential apartment property as approved by the City, according to the terms of the Development Agreement, and in a manner consistent with other government rules and regulations. No agreements by Discovery with others which purport to allow the use of the Leased Property in a manner contrary to this Lease Agreement, or to the Development Agreement, shall be allowed, or enforceable, against the City or in rem against the Leased Property. 17. During the term of this Lease Agreement, the City shall be allowed reasonable access to the Leased Property for any purpose related to any municipal or police power function, to meet its obligations under this Lease Agreement or the Development Agreement, or to function in its capacity as the owner of the Leased Property. The City shall make all reasonable efforts to not materially disrupt Discovery's allowed use of the Leased Property. 18. During the term of this Lease Agreement, Discovery shall be deemed the owner of all improvements constructed on the Leased Property by Discovery, subject to any legal rights to the improvements of third— parties. The City may take actions to gain ownership of improvements on the Leased Property upon the abandonment of the development and related interests by Discovery, assignees, or others by providing known interested parties notice and a right to cure default or to affirm interest in the Leased Property. 3 April 28, 2017 19. Discovery has had sufficient access to the Leased Property and as a result is or should reasonably be aware of all aspects related to conditions found on, in, and under the Leased Property. The City makes no express or implied promises or warranties related to the condition of the Leased Property except those identified in the Development Agreement. 20. Discovery assumes full and complete responsibility for its development activities, fixtures, or improvements to the Leased Property from the date of this Lease to the date Discovery purchases the Leased Property pursuant to this Lease Agreement. 21. Discovery acknowledges that it assumes and accepts the responsibility of ensuring that its investments in or on the Leased Property are protected through all appropriate insurance, separate agreements with its Project Lender, or other measures required or allowed by law. 22. Discovery shall have reasonably necessary insurance with sufficient limits which will cover its employees, agents, actions, and property related to the Leased Property. Discovery shall hold the City harmless from any accident, incident, or damage involving Discovery, its employees or agents, or any dispute with any 3rd party resulting from any action of Discovery, its agents or assigns, occurring during the term of this Lease Agreement, provided the same is not caused by the negligence or acts of the City. 23. Discovery is responsible for paying all utilities, costs, expenses, taxes, and obligations of any kind for the Leased Property incurred during the term of this Lease Agreement. Discovery is further required, at its expense, to keep and maintain in good order, condition, and repair the Leased Property and all improvements constructed thereon. 24. Discovery shall not allow any encumbrance to be filed on or against the Leased Property, including mortgages, easements, or similar restrictions that remain uncured or un -bonded for more than 30 days. 25. All terms of the Development Agreement pertaining to the Leased Property (referred to in Development Agreement as the "Property") are incorporated into this Lease Agreement, including but not limited to the representations and warranties. The City may pursue any breach or default of this Lease Agreement or of the Development Agreement as allowed by law. 26. Discovery's restrictions on the use of the Leased Property during the term of this Lease Agreement are set forth in the Development Agreement, and are specifically incorporated into this Lease Agreement. All other terms, conditions, benefits, burdens, and agreements between these parties relating to the Leased Property shall remain in full force and effect, without alteration. [signature page follows] Document Drafted By: David J. Praska, Deputy City Attorney Oshkosh, Wisconsin M April 28, 2017 IN WITNESS WHEREOF, the parties hereto have executed this Lease Agreement as of the date first above written. LESSEE: Discovery Properties, LLC Michael Goudreau, Managing Member STATE OF WISCONSIN } } ss. COUNTY OF WINNEBAGO } LESSOR: City of Oshkosh By: Mark A. Rohloff, City Manager Pamela R. Ubrig, City Clerk Approved as to Form: in Lynn Lorenson, City Attorney Personally carne before me this day of , 2017, the above-named Michael Goudreau, to me known to be the person who executed and acknowledged the foregoing instrument. Notary Public, State of Wisconsin My Commission expires: STATE OF WISCONSIN } } SS COUNTY OF WINNEBAGO } Personally came before me this day of , 2017, the above nained Mark A. Rohloff, to me known to be the person who executed and acknowledged the foregoing instrument. Notary Public, State of Wisconsin My Commission expires: STATE OF WISCONSIN } } SS COUNTY OF WINNEBAGO } Personally came before me this day of , 2017, the above named Painela R. Ubrig, to me known to be the person who executed and acknowledged the foregoing instrument. Notary Public, State of Wisconsin My Commission expires: 5 April 28, 2017 CONSTRUCTION STAGING AREA LICENSE AGREEMENT This License Agreement ("Agreement") is between the City of Oshkosh, a Wisconsin Municipal Corporation (City) with a principal address of 215 Church Avenue, P.O. Box 1130, Oshkosh, Wisconsin 54903-1130, and Discovery Properties, LLC, a Wisconsin Limited Liability Company (Discovery), with a principal address of 230 Ohio Street, Suite 200, Oshkosh, Wisconsin 54902. RECITALS The following City -owned property ("Staging Property") is the subject of this Agreement: Part of Lots 1 and 2 in L. M. Miller's First Addition recorded in the Winnebago County Register of Deeds Office, all being a part of Block 26 in the Second Ward, located in the Northeast 1/4 of the Southwest 1/4, Section 24, Township 18 North, Range 16 East, City of Oshkosh, Winnebago County, Wisconsin being more particularly described as follows: Commencing at the Northwest corner of the Southwest 1/4, said Section 24; thence South 00°-15'-31" East along the West line of said Southwest 1/4, a distance of 23.88 feet; thence North 89°-56'-16" East, a distance of 1,789.98 feet to the Northwest corner of Lot A in G. Papendeik's Plat recorded in the Winnebago County Register of Deeds Office; thence South 13°-24'-44" West along the West line of Lots A, B and C of said G. Papendeik's Plat and the West line of said Lot 1, a distance of 133.54 feet to the point of beginning; thence South 76°-52'-22" East, a distance of 100.00 to the Northerly extension of the West line of the East 60 feet of Lot 3 of said L. M. Miller's First Addition; thence South 13°-24'-44" West, along said Northerly extension, a distance of 67.52 feet to the South line of said Lot 2; thence North 76°-35'-16" West along said South line, a distance of 100.00 feet to the Southwest corner of said Lot 2; thence North 13°-24'-44" East along the West line of said Lots 1 and 2, a distance of 67.02 feet to the point of beginning. A map of the Staging Property is attached as Exhibit A. The Staging Property is identified as Lot 3 in a draft Certified Survey Map. Discovery will construct residential garages and reconstruct parking areas on adjoining property that it is leasing from the City and will purchase when the construction project is complete. Discovery will use the Staging Property both for access to the construction project area, as well as a staging area for materials and equipment used in the construction project. The construction project is neither a public improvement project nor a public project in any manner. The act of storing equipment and material near the construction site results in efficiencies in terms of time, cost savings, and impact upon neighboring public facilities. These efficiencies May 4, 2017 benefit both the City and Discovery and form the underlying consideration for this Agreement. Therefore, the City agrees to allow Discovery temporary use of the Staging Property pursuant to the terms and conditions in this Agreement. AGREEMENT 1. LICENSE. The City grants to Discovery a License to use the Staging Property. Discovery accepts the License pursuant to the obligations described in this Agreement. The details of the License and Discovery' agreements and obligations are as follows: a. The License is temporary; b. The License or the limited purpose of allowing access to adjoining property for construction purposes, and for use as a staging area for Discovery's project which will involve environmental remediation, construction of residential garages, and reconstructing surface parking areas. The adjoining property is owned by the City and leased by Discovery to allow construction while they are undertaking environmental remediation; c. The License applies to Discovery' employees, officers, agents, suppliers, and subcontractors. However, Discovery is directly responsible to the City for all actions/inactions on the Staging Property by employees, officers, agents, suppliers, and subcontractors. d. The License may be used for ingress and egress, and to otherwise provide access to the construction project; e. The License may be used for storage and use of construction equipment, supplies, and material; f. The License requires full cooperation and compliance with the City in establishing and maintaining the use of the Staging Property; g. The License requires Discovery to protect the City's Staging Property, including any facilities and improvements. Discovery shall, at its expense, repair all damage and return the Staging Property to its condition at the beginning of the License; and, h. All other terms within this Agreement are incorporated into the License. 2. TERM. The term of this License begins on the date this Agreement is signed by all parties. The Director of the City's Department of Community Development (Director), or their designee, shall have the sole discretion in determining the date Discovery's License expires. The License will expire pursuant to any of the following events: a. The License will expire on the date Discovery no longer remains involved as the developer of the construction project. If the City is unclear of Discovery's association with the construction project, it will provide Discovery with written notice 2 May 4, 2017 of License expiration via first class mail and allow Discovery seven (7) calendar days from the date of mailing to show cause why the License should not expire. b. If Discovery remains involved as the developer of the construction project through its completion, then the License will expire twenty (20) days after the Director determines at their discretion that the construction project is complete, or has been interrupted for an extended period of time, or has been abandoned. c. The License will expire if Discovery materially breaches this Agreement, after the Director provides Discovery with written notice of breach via first class mail and allow Discovery seven (7) calendar days from the date of mailing to show cause why the License should not expire. d. The License will expire if Discovery fails to reasonably accommodate and minimize the impact of its access and the Staging Property's use as a staging area on neighboring properties, after the Director provides Discovery with written notice of breach via first class mail and allow Discovery seven (7) calendar days from the date of mailing to show cause why the License should not expire. e. The License will expire for any reason based upon any material adverse effect upon the City, the adjoining City right of way, neighboring properties, or public storm water facilities, or surface water runoff after the Director provides Discovery with written notice of breach via first class mail and allow Discovery seven (7) calendar days from the date of mailing to show cause why the License should not expire. f. All responsibilities, obligations, and liabilities identified in this Agreement or pursuant to any law shall survive the expiration of the License. 3. USE OF STAGING PROPERTY: This Agreement allows/requires Discovery to use the Property as follows: a. A map of the boundaries within the Staging Property that Discovery will be allowed to use is attached as Exhibit A, with the attached map fully incorporated into this Agreement. b. Discovery shall provide the City with acceptable pre -construction and post - construction maps and written description of uses of the Staging Property. The Staging Property shall be left in the same condition, including grading, drainage, and elevations, as existed at the beginning of the License period. The post -construction surveys shall be used to ensure that the Staging Property remains in the same condition. The Director will inspect the Staging Property to ensure that it remains in the same condition. c. Discovery shall maintain a minimum fifteen (15) foot buffer zone from the south property line, with that property line being the north wall of the building on that adjoining property. Discovery will take all reasonable precautions to minimize the noise near this adjoining building. 3 May 4, 2017 d. Discovery shall take all reasonable and necessary actions to preserve the existing condition of the surface of the Staging Property, as well as any vegetation on, surrounding, and near the Staging Property. e. Discovery' use of the Staging Property may include the location of construction trailer, construction equipment, a materials trailer, construction materials, and other items normally related to a staging area. f. Discovery is responsible for fencing the area and posting all necessary signs. While the City requires fencing and signage to prevent unauthorized persons to enter the Staging Property, Discovery is solely responsible for the means and methods of carrying out this obligation, and is solely responsible for all liabilities associated with fencing and signage issues, as well as all responsibilities associated with their use of the Staging Property. g. Discovery shall obtain the approval from the Director of a site plan for the Staging Property, which may include storage locations, fencing, and access. Discovery shall not permit any waste or damage to the Staging Property. h. Discovery shall maintain the Staging Property and keep the area in good condition and repair and free of any litter, construction debris, and shall not allow litter, debris, dust, or materials to blow away from the site. i. Only materials and equipment used for the adjoining construction project shall be allowed on the Staging Property. j. Discovery shall take all reasonable measures to cooperate with surrounding property owners in efforts to minimize adverse effects of Discovery' use of the Staging Property. k. Discovery shall remove all equipment, fencing, materials, debris, its hazardous materials, and so forth from the Staging Property at the expiration of the License. The City may take all reasonable actions to remove any object or condition from the Staging Property related to the License which Discovery has failed to remove, and shall be fully reimbursed by Discovery for these actions. 4. USE OF ADJOINING CITY RIGHT OF WAY: Discovery will access the Staging Property via City streets, curb and gutter, terrace, and public sidewalk. The License is contingent upon Discovery's protection of nearby City facilities such as streets, curb and gutter, right of way terrace, and public sidewalks. Discovery must fully document the condition of the right of way surface and facilities at the beginning of the License period, so that any damage identified by the City during or after the License period may be compared to its original condition. Discovery shall repair or replace all damaged City property and facilities at the completion of the construction project. The Director shall have complete discretion to perform inspections and to determine if repair or replacement is appropriate, along with the appropriate time frame for performing such repairs and/or replacements. Discovery shall keep the adjoining right of way free from equipment, construction material, and debris. Discovery shall keep State Street and the adjoining 4 May 4, 2017 sidewalk clean at all times, and shall not cause the artificial accumulation of snow and/or ice on the street or public sidewalk. Discovery is responsible for keeping the public sidewalk in safe condition for public use. Except for emergency safety concerns, Discovery shall not block the street or public sidewalk for any reason without the explicit permission of the Director. Discovery shall be responsible for the cost of all signage or other expenses the Director deems necessary as a result of any closures of public sidewalk or street. 5. FEE. No fee shall be required. 6. INDEMNIFICATION. Discovery agrees to hold the City, its officers, officials, agents, and employees harmless from any and all liability, including claims, demands, losses, costs, damages, and expenses of every kind and description (including death), or damages to person or property arising out of the terms of this Agreement where such liability is founded upon or grows out of the acts or omission of any of Discovery's officers, employees, agents, suppliers, or subcontractors while acting within the scope of their employment or service to Discovery. Discovery shall indemnify the City for any costs or damages associated with the terms of this Agreement. Subject to any limitations contained in Sec 893.80 and any similar statute, of the Wisconsin Statutes, the City agrees to hold Discovery, its officers, officials, employees, and agents harmless from any and all liability, including claims, demands, losses, costs, damages, and expenses of every kind and description (including death), or damages to person or property arising out of the terms of this Agreement where such liability is founded upon or grows out of the acts of omission of any City's officers, employees, or agents while acting within the scope of their employment. 7. MUNICIPAL LIABILITY. Nothing in this Agreement is intended as a waiver of the municipality's right or opportunity to rely upon the municipal limitations and immunities contained within Wisconsin law. Municipal immunities and limitations include, but are not limited to, Sections 345.05, 893.80, and 893.83, Wisconsin Statutes. Such damage limits, caps and immunities are intended to be preserved and are incorporated into this agreement and shall be applied to and govern all disputes, contractual or otherwise, as they apply to the municipality and its agents, officers, and employees. 8. RISK OF DAMAGE OR LOSS. Discovery assumes all risk of the damage to or loss of any person or of anything it places on the Staging Property. Discovery is responsible for any injury to all persons and personal property related to this License. Discovery accepts the property "as -is," and releases the City and waives any recovery against the City for any loss arising out of or incident to Discovery' use of the Staging Property or City right of way. 9. HAZARDOUS MATERIALS. Discovery shall not use, generate, manufacture, store, transport, or dispose of any flammable liquids, radioactive materials, hazardous materials, hazardous waste, or similar material (collectively, "Hazardous Materials") as that or these terms may be defined under federal or state laws under, on, in, or above the Staging Property. Excepted from the previous sentence are Hazardous Materials in the vehicles, equipment, or materials that Discovery will use for the adjoining construction project. Any discharge, leakage, or spillage of hazardous materials of any type under, on 5 May 4, 2017 or over the Staging Property as a result of Discovery's actions, regardless of whether the actions are otherwise allowed, shall be reported to the City pursuant to this Agreement, and to others as required by law. Discovery, at its sole cost and expense, shall undertake all appropriate remediation on the Staging Property affected by its discharge, leakage, or spillage of Hazardous Materials, whether owned by the City or any third party, to the satisfaction of the City and any government body having jurisdiction over such event. Discovery shall not be responsible for any Hazardous Materials on or under the Staging Property, whether known or unknown, present as of the date of this Agreement. 10. INSURANCE. Discovery shall maintain during the term of the License, at Discovery's sole expense, a policy of comprehensive general liability insurance in an amount no less than One Million and NO/100 Dollars ($1,000,000.00) along with other terms and amounts satisfactory to the City. The City shall be included as an additional insured for such policy using language provided by the City. A copy of Discovery's certificate of insurance that identifies the City as an additional insured shall be provided to the City prior to any use of the Staging Property pursuant to this License. 11. DEFAULT. In the event of a breach by Discovery of any of the terms of this License, all rights of License hereunder shall expire when the City provides written notice of such default, and in addition to all other rights that the City may have at law or in equity. 12. RULES AND REGULATIONS. The Director shall have the sole right to establish and enforce reasonable rules and regulations concerning the management, use, and operation of the Staging Property and adjoining City right of way by Discovery, including addressing issues related to how Discovery's use of the Staging Property and right or way affects nearby properties. However, any decision of the Director to not establish or enforce reasonable rules and regulations shall not act as an acceptance, approval, or consent to any action or inaction of Discovery, or wavier of any right of the City. Discovery requests that this Agreement not list additional specific rules and regulations to maintain flexibility in its use of the Staging Property and acknowledges that its best interests are served by this method. Compliance with any subsequently created rules and regulations established by the Director for Discovery, its officers, agents, employees, and subcontractors are expressly made terms of this Agreement. 13. ASSIGNMENT AND SUBLETTING. This License and Agreement is personal to Discovery and cannot be sold, transferred, encumbered, or pledged to any other person or entity without the specific written approval of the Director. In the event the Director approves any delegation or assignment duties related to this License, any such assignment shall not relieve Discovery of its obligations under this Agreement. 14. GOVERNING LAW. This License Agreement shall be interpreted, enforced, and governed by the laws of the State of Wisconsin, and any disputes shall be resolved in Winnebago County, Wisconsin. 15. AMENDMENTS. No provision of this Agreement may be amended or modified except by an agreement in writing executed by both parties. 6 May 4, 2017 16. THIRD PARTY BENEFICIARIES. The terms of this License shall benefit and burden only the parties to this Agreement and are not intended to benefit any third party. 17. SEVERABILITY. The determination by a court of competent jurisdiction that any term of this Agreement is invalid, illegal, or unenforceable shall not invalidate the remainder of the Agreement. CITY OF OSHKOSH Date: Mark A. Rohloff, City Manager Pam R. Ubrig, City Clerk Approved as to form: Lynn A. Lorenson, City Attorney DISCOVERY PROPERTIES, LLC Date: ME Michael A. Goudreau, Managing Member 7 May 4, 2017 D R A F T For purposes of identifying . General Location Only ' CER711PIED SURVEY MAP DISCOVERY P & PERTIFS, LLC THE CITY OF OSHKOSH LOTS A, 8 AND C IN G. PAPENDIN'S P(AT, LOTS 1, 2 AND 4 AND PART OF LOTS 3 AND 5 IN L. M, MILLER'S FIRST " ADDITION, ALL BEING PART OF BLOCK 26 IN THE SECOND WARD, LOCATED IN THE NE 1/4 OF THE Slit 1/4, SECTION 24, TOM SHIP 16 NORTH, RANGE 16 EAST, CITY OF TOTAL AREA OSHKOSH, WINNEBAGO COUNTY, WISCONSIN, 42,204 Sq, FT. 0,969 ACRES ,WASHINGTON AVENUE w Ita+knrr raw pvauo swr-a-iuYww YMa31 uu PaB „ 100VIO'! 118,43' qssisr a.......-•----•- -- • ------fir .�. I• i'� xti3tTY[ I,ilF4Y- 1=!, etldN ,;, 7 1 DunolNo LOrifX=Ar11 i I"33 ACEs' 1� O i cTl u N� h4lAE „� SDO'4540t `F .�?`xTur>ur�s'—fie �'rrJ 23,77' , , t v/A 4 a'�JCE } f )4 r4 tK=1' I., f r o £fir r�,��' n�� e�9�iK•��`��' � Ts sp,35'l6/w , 1� kK �• lora S78J5� .a�torc�aQ °v^r 0.. ACEs $ 89 2 �i I A awrue �� a�7x OT J � 1!' naH 33rnrnxx uusmrf }. p I poG (!sl,J 0.151 ACRES �"• ra Oa0. x 1,rm '� +,�, # a {• nor ara.0 scr e5 ax '�. arr-Is.c a � RQlll(61Y a � �s„1Dt '� 'i aPo> . tot «ns "moi ad sumCY to S,°iHe f��)' '+ i STAGING AREA _ •" (Y78JS'18'Iyz ,sa liar{ t i2g24 A6.000 7 ,Rclo sw�t18rvin�� fil' 1•C Y n,� 4 j j � � h� a�rrcr_y�n �,,� •(•Y.�� ilil`i{'c LOT 1, LOT 2, AND LOT 3 0 -- 1' IRON REDAR FOUND SUfivtOT TO A 'CROSS 0 — 1/2' IRON REBAR FOUND OVIIIfiR SU13DJHDM$I PARORtl EASEMENT' EASEMENT' TO BE RECORDED TO DISCOVERY PROPERTIES, X CUT 'X SET 230 OHIO STREET LLC AS A SEPARATE DOGUAIENT >R -- MAG HAIL SET sum 200 OSHKOSH, 4A S4902 WRVFYORt RYAN r -- 3/4' IRON REBAR SET Y LOftEEN p -• 3/4' IRON REBAR FOUND CITY OF OSHKOSH EXCEL EnONEERINO, ,NO, 100 CAMELOT DRIIE 215 CHURCH AVENUE A I/2` IRON PIPE POUND P.O. BOX 11-30 FOND OU LAC, Yd 54935 • A -- i' IRON PIPE FOUND OSHKOSH, Yd 31903 SHEET 1 OF S SHEETS — SECTION CORNER MON, FOUND NORTH POINT RErERENCED TO THE YSCONSIN COUNTY COORDINATE SYSTEM, YNNEDACO COUNTY. THE VlEST �" LINE OF THE SOUTHWEST QUARTER HAS A RECORDED Q Ak4paBeckrPlrn SEARING OF SOUTH OO. 15''31 EAST.ff//�•� ,00CANI m" XCEL 5p' V. Eo' Q so' 1 0 P "'""""�'�'r� row DUVgYd S,s7r ENGINEERINGs,. SURV�EYINO anoop SCALE FEET PROJECT N0. 1406880 exhibit Document Number Access Easement Document Title THIS AGREEMENT ("Easement Agreement") is made this day of 2017, By and between the City of Oshkosh ("City"), Grantor, and Harry E. Kieckhafer and Priscilla D. Kieckhafer, Trustee of the Harry E. and Priscilla D. Kieckhafer Revocable Trust of 1991 u/a/d December 10, 1991 ("Kieckhafer"), Grantee: IN CONSIDERATION of the sum of One Dollar ($1.00) and other good and valuable consideration paid by Kieckhafer, the receipt of which is hereby acknowledged, the City does hereby give and grant unto the Kieckhafer, its successors and assigns, and Kieckhafer accepts, a non-exclusive access easement over, under, and through the Grantor's Property as hereinafter described. Recording Area Name and Return Address City Attorney's Office P.O. Box 1130 Oshkosh, W154903-1130 EASEMENT PURPOSE: The purpose of this Easement Agreement is to allow Kieckhafer the right to cross certain City property for the 90200620000 purpose of accessing and using parking spaces located at the rear of 90200640000 a building On Kieckhafer's adjoining property. Parcel Identification Number (PIN) GRANTEE PROPERTY. Kieckhafer owns property commonly known as 300 and 302 State Street, tax parcel 902006400, at the northeast corner of State Street and Waugoo Avenue ("Grantee's Property"). An early 20" Century -era multi -story office building is located on Kieckhafer's property. The office building ends at the lot lines on the north, south, and west sides. The office building does not reach the east lot line, and as a result that extra space is used for parking for office building tenants, residents, and invitees. Those parking at the office building have, in the past, accessed those spaces via the adjoining City public parking lot. GRANTOR'S PROPERTY: The City owns property that for many years has been used as a public parking lot and generally has been referred to as the State Street Parking Lot. The City property, tax parcel 90200620000, borders Waugoo Avenue on its southern border and State Street on part of its western border. The easement benefits and burdens granted by this Agreement will be located on a relatively small part of the City property. The City property is more particularly described as ("Grantor's Property"): Located in the City of Oshkosh, Winnebago County, Wisconsin, and originally part of Fractional Lot 1 of Section 24, Township 18 North of Range 16 East, and more particularly described: All of Lots one (1) and Two (2), the Easterly 60 feet of Lot Three (3), all of Lot Four (4), and the Westerly 29.2 feet of Lot Five (5), all on Block Twenty-six (26) of L.M. Miller's First Addition, 2❑d Ward, City of Oshkosh; And Lot "C" in Papendixk's Plat, in the 2 n Ward, City of Oshkosh, per Leach's Map of 1894, originally being a part of Fractional Government Lot 2, Section 24 Township 18 North, Range 16 East. EASEMENT PROPERTY. The "Easement Property" subject to this Easement Agreement is a forty -foot (40 ft.) by thirty-foot (30 ft.) section of the Grantor's Property adjoining the eastern boundary of Grantee's Property. A map to be used for locational reference only of the Easement Property is attached as Exhibit A The Easement Property is more particularly described as: [insert Easement Property legal description] l 28, 2017 EASEMENT: A non-exclusive access easement, solely for ingress and egress, is granted by the City, and accepted by Kieckhafer, over and through the property identified in this Easement Agreement as the Easement Property ("Access Easement"). NON -EXCLUSIVITY: Kieckhafer's use of the Easement Property is non-exclusive. The surface of the Easement Property is currently used by the City as part of its public parking lot. It is anticipated that the City will convey part of Grantor's Property to private parties, and further anticipate that the Easement Property will be used as part of a private parking lot, including drive aisles or other features of the private parking lot. Kieckhafer accepts this Easement subject to the continued active use of the Easement Property surface as long as the ability for ingress and egress is reasonably maintained. The City or its successor interest may install additional or new utilities or facilities necessary to serve the Grantor's Property or adjoining property in, over, or across, the Easement Property. The City, or its successor, may allow other public utilities to locate within the Easement Property. All parties agree to work in good faith to resolve issues regarding the safe and efficient use of the Easement Property by the parties or others wishing to also utilize the Easement Property. EASEMENT RIGHTS/LIMITATIONS: Grantor grants, and Grantee accepts, the non-exclusive Access Easement over and through the Easement Property. The rights and limitations of the Access Easement are as follows: a. The Easement Property may only be used for ingress and egress to allow vehicular access to parking spaces on Kieckhafer's adjoining property, PIN 90200640000. As noted in the Easement Property legal description and the location map, ingress and egress is limited to Waugoo Avenue, as direct access to State Street will no longer be available. Access through the Easement Property is limited to those renting, leasing, using, or invited to use, the building on Grantee's property. The City and any successor in interest seeks to limit the impact on the surface of the Easement Property, as well as ensure that vehicles are able to safely back, turn, and maneuver within identified Easement Property. To that end, vehicles using the Easement Property for access are limited to motorcycles and those requiring a Class D driver's license. For purposes of illustration only, most automobiles and pickup trucks would be allowed access, but vehicles requiring a commercial driver's license, trailers, and construction equipment, would not be allowed to utilize the Easement Property for access to the Kieckhafer property b. Kieckhafer's use of the Easement Property is for surface access only, and shall not be used for parking (short or long term), storage, or any other similar use. c. Kieckhafer accepts the Easement Property as -is. The condition of the Easement Property as well as all maintenance, repair, and replacement shall be at the sole and exclusive discretion of the Grantor. Grantor, however, agrees to act in good faith and in a reasonable manner. MAINTENANCE: Except as otherwise described in this Agreement, Grantor is responsible, at its sole and exclusive discretion, for maintaining the surface and for repairing normal wear and tear of the surface. Grantor and Grantee shall be responsible, at their own expense, for repairing specific damages caused in whole or in part by their respective use of the Easement Property. a. In general terms, Grantor is responsible for routine maintenance, repair, and replacement of its property, including the surface of the Easement Property and any of its facilities below the surface. Examples of routine surface maintenance include care of hard surfaces, snow and ice removal, striping, and landscaping which may include grass, trees, shrubs, and other vegetation. Grantor will be responsible for repairs and replacement provided such actions are not required because of specific actions resulting from Grantee's use of the Easement Property. b. Grantor shall have the right to close or limit access to the Easement Property for purposes related to maintenance, repairs, or replacement of improvements over, under, and through the Easement Property. Such closures or limitations shall occur at the discretion of the Grantor. Grantor shall make reasonable efforts to notify the Grantee of such upcoming actions to allow Grantee to make alternative parking arrangements. Grantor agrees to undertake actions that close or limit access to the Easement Property in a reasonable manner. Such closure or limitations shall not entitle Grantee to compensation for inconvenience, disruptions, or other damage or loss. April 28, 2017 2 c. Grantee shall be responsible for the cost of repairing or replacing any damage to its own property, or those it authorized to use the Access Easement, the Grantor's facilities, including without limitation landscaping, storm water drainage features and facilities, electrical, sanitary sewer, or any other Grantor facility, which is damaged or altered to the extent caused by Grantee's use of the Easement Property. d. Grantee shall hold harmless and fully indemnify Grantor for damage to the facilities owned, operated, or used by third -parties to the extent caused by Grantee and/or resulting from Grantee's use of the Easement Property. USE OF EASEMENT BY OTHERS: The Grantee agrees that the Grantor may temporarily assign the access and maintenance rights identified herein to a third party, or other person. Assignees must demonstrate to the Grantor that they have sufficient competence and must give adequate assurances that any work to be performed in or around the Easement Property shall be conducted in a skillful manner. Assignees must also protect the Grantor's interest in the Easement Property to the same extent as if the Grantor was itself performing the construction or maintenance. Grantee and Grantor are responsible to the other for damages caused by their respective employees, agents, and contractors. 10. INDEMNIFICATION: The owners and users of the Grantee's Property shall indemnify and hold harmless the owners of the Grantor Property from and against all loss, costs (including reasonable attorney fees), resulting from injury, death, or damages to person or property that occurs at any time during the term of this Easement Agreement which may be suffered or sustained by any person or entity in connection with the activities of the owners and users of Grantee's Property which are conducted on Grantor's Property, regardless of the cause of the injury, except to the extent caused by the negligence or misconduct of the owners of the Grantor's Property, their agents, servants, or employees. 11. INSURANCE: Grantee, and for any other party who exercises rights through Grantee and under the easements granted by this Agreement (collectively with Grantor, the "Grantee Parties"), shall maintain in effect at all times during the term of this Agreement a policy of commercial general liability insurance naming Grantor and any other party designated by Grantor as the insured, with a minimum limit amount of $1,000,000, to insure against injury to property, person, or loss of life arising out of the Grantee Parties' use, occupancy, or maintenance of the easement in favor of the Grantee Parties or the Grantor's estate with limits of coverage that are at levels customarily maintained by businesses in the community in which the Grantor's Property is located. For each year in which this easement is in effect, the Grantee Parties shall provide the Grantor and the other parties designated by the Grantor with a copy of the insurance policy endorsement or wording showing that the Grantor and the other parties have been added as additional insureds. The policy shall contain a supplemental endorsement covering contractual liability voluntarily assumed by the insured under this Agreement. Insurance required of the Grantee Parties under this Agreement shall be written by companies duly qualified to do business in the State of Wisconsin and shall be satisfactory in all reasonable respects to the Grantor and the holder of any mortgage against the Grantor's Property. The Grantee Parties shall deliver to Grantor copies of the policies or certificates evidencing the existence and amounts of the insurance with loss payable clauses reasonably satisfactory to the Grantor. No such policy shall be cancelable or subject to reduction of coverage or modification except after 30 days' prior written notice to Grantor. At least 30 days before the expiration of the Grantee Parties' policies, the Grantee Parties shall furnish Grantor with renewals or binders of the policies, or the Grantor may order such insurance and charge the cost to the Grantee Parties. The Grantee Parties shall not do or permit anything to be done that will invalidate the insurance policies furnished by the Grantee Parties. The Grantor may from time to time require that the policy limits of any or all such insurance be increased to reflect the effects of inflation and changes in normal commercial insurance practices. 12. DEFAULT: Except for emergency circumstances, if either Grantor or Grantee reasonably believes that the terms of this Easement Agreement have been breached, then written notification of the alleged breach shall be delivered to the other party. Any party in breach shall have sixty (60) days to cure any actual breach. In emergency circumstances, either party may immediately take all necessary actions to protect the safety and functioning of its facilities within the Easement Property. 13. TERM: This Easement Agreement shall be perpetual, shall run with the land, and shall provide benefits and burdens upon the parties' successors and assigns. This document shall be recorded with the Winnebago County Register of Deeds at Grantee's expense. 14. EXISTING EASEMENTS: As described in this Easement Agreement, the Easement Property is or will be subject to other easements and uses by Grantor and by third -parties. 15. WAIVER: No delay or omission by any party to this Easement Agreement in exercising any right or authority related to a term or condition of this Easement Agreement shall be construed as a waiver of that right or authority. April 28, 2017 However, the notice and opportunity to cure provisions in paragraph 9, above, shall remain a prerequisite to making a claim of default against the other party. 16. INVALIDITY: If any term or condition of this Easement Agreement shall be held invalid or unenforceable by a court of competent jurisdiction, then the remainder of this Easement Agreement shall continue to be valid and enforceable to the fullest extent permitted by law. 17. NO THIRD PARTY BENEFICIARY: The terms of this Easement Agreement are for the benefit of the parties identified, and it is not the intention of either the Grantor or Grantee that other persons or parties shall acquire any rights to enforce or benefit from through this Access Easement. 18. MUNICIPAL LIABILITY: Grantor incorporates into this Easement Agreement and relies upon its municipal limitations and immunities contained within Wisconsin law. Grantor's municipal immunities and limitations incorporated include, but are not limited to, Sections 345.05, 893.80, and 893.83, Wisconsin Statutes. Except for actual physical damage to Grantee's facilities in the Easement Property, the aforementioned damage limits, caps and immunities shall be used to govern all disputes, contractual or otherwise, as they apply to the municipality and its agents, officers, and employees. 19. GOVERNING LAW: This Easement Agreement shall be construed and enforced in accordance with the laws of the State of Wisconsin. Venue for any action regarding this Easement Agreement shall be the Winnebago County, Wisconsin, Circuit Court or, if a federal court action, then the appropriate district and/or branch within which Winnebago County is located. 20. NOTICES: Any notices required by this Easement Agreement shall be in writing and delivered via certified mail, return receipt requested, as follows. Changes to these addresses shall be in writing. In addition to formal notification, both parties agree to take reasonable measures to keep the other party informed of issues or questions regarding the Easement Property. FOR THE GRANTOR: City of Oshkosh c/o Director of Public Works 215 Church Avenue Oshkosh, WI 54902 FOR THE GRANTEE: Priscilla D. and Harry E. Kieckhafer, Trustee 21. AUTHORITY: The Grantee affirms that all approvals for this Easement Agreement necessary according to its structure have been obtained and have approved the acceptance of this Easement, and that the undersigned have the authority to sign this Easement Agreement on behalf of the Grantee. Grantor affirms that all necessary boards and elected officials have approved the granting of this Access Easement, and that the undersigned have the authority without limitation to enter into this Easement Agreement. The undersigned assert and affirm that they have the authority without limitation to enter into this Easement Agreement on behalf of the Grantor and Grantee. SIGNATURE PAGE FOLLOWS This instrument drafted by: Attorney David J. Praska Oshkosh, WI 54903-1130 April 28, 2017 4 IN WITNESS WHEREOF, said Grantor and Grantee have hereunto set their hand and seal the day and year first above written. GRANTOR: CITY OF OSHKOSH Mark A. Rohloff, City Manager Pamela R. Ubrig, City Clerk STATE OF WISCONSIN ) ) ss. WINNEBAGO COUNTY ) Personally came before me this day of , 2017, the above named Mark A. Rohloff and Pamela R. Ubrig of the City of Oshkosh, to me known to be such persons who executed the foregoing instrument and acknowledged the same, for the purpose herein contained. Notary Public, State of Wisconsin My Commission expires: APPROVED AS TO FORM: Lynn A. Lorenson, City Attorney GRANTEE: HARRY E. KIECKHAFER and PRISCILLA D. KIECKHAFER, TRUSTEE OF THE HARRY E. AND PRISCILLA D. KIECKHAFER 52 52 REVOCABLE TRUST OF 1991 u/a/d DECEMBER 10, 1991, Priscilla D. Kieckhafer, Trustee Harry E. Kieckhafer, Trustee STATE OF WISCONSIN) ) ss. COUNTY ) Personally came before me this day of , 2017, the above named Priscilla D. Kieckhafer, to me known to be such person who executed the foregoing instrument and acknowledged the same, for the purpose herein contained. Notary Public, State of Wisconsin My Commission expires: STATE OF WISCONSIN ) ) ss. COUNTY ) Personally came before me this day of , 2017, the above named Harry E. Kieckhafer, to me known to be such person who executed the foregoing instrument and acknowledged the same, for the purpose herein contained. Notary Public, State of Wisconsin My Commission expires: April 28, 2017 rr� r� r�r �: r X11'4 1 in = 0.01 mi A 1 in=50ft J The City of Oshkosh creates and maintains GIS maps and data for its own use. They may show the approximate relative location of property, boundaries and other feature from a variety of sources. Printing Date: 3130/2017 These map(s)ldatasets are provided for information purposes only and may not be sufficient or appropriate for legal, engineering, or surveying purposes. They are provided "AS -IS" without Prepared by: City of Oshkosh, W1 warranties of any kind and the City of Oshkosh assumes no liability for use or misuse. A Oshkosh J:ILISIPlanning',Plan Commission Site Plan Map Tem; latelPlan Commission Site Plan MapTemoate.mxd User: deixorahf ITEM: LAND DISPOSITION PORTION OF CITY PARKING LOT (STATE STREET LOT) IN THE 300 BLOCK OF STATE STREET GRANT CROSS ACCESS EASEMENT TO PROPERTY AT 300 STATE STREET Plan Commission meeting of April 18, 2017 GENERAL INFORMATION Applicant/Owner: City Administration Actions Requested: Two actions are requested as part of this staff report: A: Land disposition of a portion of the State Street parking lot; B: Granting of a cross access easement to 300 State Street to access portions of the State Street parking lot to be disposed. Applicable Ordinance Provisions: N/A Property Location and Background Information: The subject property involves the approximate one acre 79 stall parking lot in the 300 block of State Street. As part of implementation of the TID #30 Project Plan involving the adaptive reuse of 105 Washington Avenue from office to residential apartments, the developer is proposing to acquire a portion of the State Street parking lot to construct a combination of covered parking in garages and surface parking. The other part of the request involves granting a cross access easement behind the commercial building at 300 State Street to permit the parking spaces behind the building to continue to access the former parking lot via Waugoo Avenue. The land disposition was previously approved by the Parking Utility. The State Street parking lot previously contained an automobile service facility and a Phase II environmental investigation has identified an underground storage tank and contamination that will be remediated as part of the project. Subject Site Existin Land Use Zonin Public Parking Lot I - Institutional Land Use and Existing Uses > Zoning North I Residential and Offices CMU South Office and Commercial _..........._.._......._........_......._......_....._.............._.—_...._.._._................._ East Residential and Parkin ............_.._....._........._..........—......................................._..._ West Commercial C_MU_ CMU CMU Comprehensive Plan Land Use Recommendation Land Use 10 Year Land Use Recommendation Mixed Downtown Development 20 Year Land Use Recommendation Mixed Downtown Development ANALYSIS The actions proposed are consistent with implementing the TID #30 Project Plan with that being the provision of covered parking to support the adaptive reuse of 105 Washington Avenue into "higher end" apartments. In order to do this, the developer has proposed acquiring a portion of the State Street parking lot (approximately 25,351 square feet) and the city retaining approximately 6,727 square feet for public parking. Because the building at 300 State Street has 3-4 parking stalls that are accessed via the parking lot, a cross access easement is also being granted to permit continued access via Waugoo Avenue. With the disposition, the developer will be able to create approximately 30 garage spaces and 11 surface stalls adjacent to the building. A current access will be removed off of State Street that will be incorporated into future William Waters Plaza redevelopment and all access to 105 Washington Avenue will come via Waugoo Avenue. The city is proposing to keep 6,727 square feet of the parking lot to retain approximately 20 public parking stalls that will be accessed only off of State Street as the lot will be separated from the adjacent private lot. The City conducted a parking demand analysis of the State Street lot and determined there were on average 10 cars parked in the lot daily and by retaining land for 20 spots would be able to support future parking demand in the area given that there are no other future major demand generators (other than 105 Washington itself) in the immediate vicinity that currently don't have some form of parking available. RECOMMENDATION/CONDITIONS Staff is recommending approval of the land disposition and granting of the easement as proposed. The Plan Commission approved of the land disposition and granting of the easement as requested. The following is the Plan Commission's discussion on this item. Ms. Williams presented the item and reviewed the area proposed to be disposed of to the property owners of 105 Washington Avenue as well as the area for the cross access easement behind the structure at 300 State Street. She reviewed these areas further and explained the reason for these requests which were part of the implementation of the TID #30 Project Plan for the adaptive reuse of 105 Washington Avenue from office use to residential apartments. The land disposition will provide the property owner with adequate area to construct garage and surface parking for the apartment use and the cross access easement will provide continued access to 3-4 parking stalls adjacent to the commercial building at 300 State Street. Item —Land Disp/Grant Easen:t/State St parking lot Mr. Bowen questioned how many parking stalls in the State Street parking lot were permit parking and how many were public parking. Mr. Nau responded that he did not have information on this aspect. Ms. Williams added that the completion of the Walker Parking Study resulted in that there were only ten vehicles utilizing the parking stalls within this lot per day and that the City was retaining 20 parking stalls for this continued use. The land disposition was also previously approved by the Parking Utility. Mr. Bowen then questioned if the parking stalls adjacent to 300 State Street were usable parking stalls. Ms. Williams responded affirmatively and explained that the cross access easement was approximately 40' by 40' with a 28' drive aisle and would provide adequate access to the parking stalls via Waugoo Avenue. Motion by Borsuk to approve a land disposition of a portion of a' City parking lot, (State Street lot), located in the 300 block of State Street and to grant a cross access easement to property located at 300 State Street. Seconded by Thoms. Motion carried 7-0. Item — Land Disp/Grant EasendlState St parking lot CERTIFIED SURVEY MAP FOR DISCOVERY PROPERTIES, LLC THE CITY OF OSHKOSH LOTS A, B AND C IN G. PAPENDIK'S PLAT, LOTS 1, 2 AND 4 AND PART OF LOTS 3 AND 5 IN L. M. MILLER'S FIRST ' ADDITION, ALL BEING PART OF BLOCK 26 IN THE SECOND WARD, LOCATED IN THE NE 1/4 OF THE SW 1/4, SECTION 24, TOWNSHIP 18 NORTH, RANGE 16 EAST, CITY OF OSHKOSH, WINNEBAGO COUNTY, WISCONSIN. P.O.C. NW CGR. - SW 1/4 SEC 24-18-16 CAST ALUL6NUY NONUNFNT FOUND 5G0'15'3I_ t zaea' d TOTAL AREA 42,204 SQ. FT.. 0.969 ACRES WASHINGTON AVENUE \� \ (PUBLIC R109 -OF -WAY MD714 VARIES) m\� �1 —A I \ iNi .- 59.67 �F £' 126' I 54.10'V y �'� ao/ SUITE 200 OSHKOSH, WI 54902 c BUILDING LOT 1 10,126 SO. FT. U N \ W \ I \ Iv >r I , I ACCESSFRAID EAS FOR . tI 1" mn I REPAIRAENT BUIDWG REPAIR 3PER 79 DDC N0. 695879 aAoaENnEs_Lyg ry Pd6Cf].JD�9dBAPtiQ 3/4' IRON REGAR SET - CD � �-�% tiN ON -UNE t 5.0' NORTHERLY 8-J5• P.v�RT9 OF LOT CORNER Jga'I 4 CUT '7C SET ON -UNE t-/ _ 5.0' VESIERLY LOT 1 COF ORNER � I I .ie 7 SW CDR. - SW 1/4 1 1J�4' IRON•7REilAR ryuND IDV CORNERt 1.4' ME3T SE'C 24-1,-76 NAG NAIL FOUND d TOTAL AREA 42,204 SQ. FT.. 0.969 ACRES WASHINGTON AVENUE LOT 1, LOT 2, AND LOT 3 (PUBLIC R109 -OF -WAY MD714 VARIES) SUBJECT TO A "CROSS N89'56'16'E+ 119.43' iNi .- 59.67 DISCOVERY PROPERTIES, LLC . J,r 191 EXISTING 4PM 1 F�Zgp� 126' I 54.10'V y �'� ao/ SUITE 200 OSHKOSH, WI 54902 c BUILDING LOT 1 10,126 SO. FT. o Igg�'�� RYAN WILGREEN aq `�' 0.233 ACRES oxl9aiscogY �� I I J S a q aAoaENnEs_Lyg ry Pd6Cf].JD�9dBAPtiQ � p I CD � �-�% tiN ,/.�a�� 8-J5• P.v�RT9 Jga'I 4 a {7 _ 0] 4 E ORVFRN LOT4M� .ie S00'45'40"f If 5,,,��� N1R0. p'�i;.Nps 4 ppb RT�`4�A79A 1 1J�4' IRON•7REilAR ryuND IDV CORNERt 1.4' ME3T OF _ PA 26_ , o s 80' s 1s%w BUCK - Lor 2 63 '� T OF for os a 7N • OT 3 d0_D, D 582 ACRES 351 SQ.a 89 2 ' 6.727 F.T.15' S'IDFW SEWER EASEMENT 5' 0.754 ACRES '� PER Doc NO 695777 7� At 8 `T",S- oftrsd N CDD. _~ o a OPOSED a' �I �/ d 15' o wID�57WRN a / SEV�4R �� �N VvSsr Rpn 0p\ Imo_ 3 9A no / Ove ING N13�4. E 26p ph7�s>\8418� 29s' a 0 1 6 IL 13D> H_Uco AVE �9. b g O R/G71j D;`�"�NUf� Z J782 �4� ` WA17 LEGEND ® — 1" IRON REBAR FOUND ❑ — 1/2" IRON REBAR FOUND X — CUT "X" SET ■ — MAG NAIL SET • — 3/4" IRON REBAR SET 0 — 3/4" IRON REBAR FOUND 0 — 1/2" IRON PIPE FOUND A — 1" IRON PIPE FOUND — SECTION CORNER MON. FOUND NORTH POINT REFERENCED TO THE WISCONSIN COUNTY COORDINATE SYSTEM, WINNEBAGO COUNTY. THE WEST F LINE OF THE SOUTHWEST QUARTER HAS A RECORDED g BEARING OF SOUTH 00'-15'-31" EAST. 60' 0 60' 120' 1"= 60' SCALE FEET AImRs a Better Plan -EXCEL ,,� DU M VA BS ENGINEERING.. F"v SURVEYING GROUP 3 LOT 1, LOT 2, AND LOT 3 SUBJECT TO A "CROSS ACCESS/CROSS PARKING OWNER/SUBDIVIDER: EASEMENT" TO BE RECORDED DISCOVERY PROPERTIES, LLC AS A SEPARATE DOCUMENT 230 OHIO STREET SUITE 200 OSHKOSH, WI 54902 SURVEYOR: RYAN WILGREEN CITY OF OSHKOSH EXCEL ENGINEERING, INC. 215 CHURCH AVENUE 100 CAMELOT DRIVE P.O. BOX 1130 FOND DU LAC, WI 54935 OSHKOSH, WI 54903 SHEET 1 OF 5 SHEETS NORTH POINT REFERENCED TO THE WISCONSIN COUNTY COORDINATE SYSTEM, WINNEBAGO COUNTY. THE WEST F LINE OF THE SOUTHWEST QUARTER HAS A RECORDED g BEARING OF SOUTH 00'-15'-31" EAST. 60' 0 60' 120' 1"= 60' SCALE FEET AImRs a Better Plan -EXCEL ,,� DU M VA BS ENGINEERING.. F"v SURVEYING GROUP 3 uDOZ311N51A16.3493 I'ToZW ( SNOIHNSHtlSM }l Z mY)m� m aVAs'H0S1OHNOHOSRO ll'SLLH3dONd/33A00510 �(V 3N6HOL'HO SLYU OWGISIH 30tlid NOLONIHSVM 6 gy 11 �ZE A , gg a i> 5 auo l�aroN o d is i1 5^ !j ii�,ti moo= <. h 19 9 ` 19 LO0iit Iia�Lll. t! J G� �� J 008 4 �yd ?YyION ��c Kpprc�rcBwyjr Zig � oL=ai / mZZ �G.< jC� �N a Mw ( 4'�j ug at a= gg mY)m� m x � �ZE A gg a i> 5 av .o a_ggll UluS f 55 E K �rrc oomo3o w' c ski llxi � �eeaee is i1 5^ !j ii�,ti moo= <. h 19 9 ` 19 LO0iit Iia�Lll. t! 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They are provided 'AS -IS' without warranties of any kind and the City of Oshkosh assumes no liability for use or misuse. Commission Site Plan Map TemplateRan Commission Site N 1in=0.02 mi 1 in = 80 ft Printing Date: 8/25/2016 Prepared by: City of Oshkosh, WI ^A Qf h_kosh 11— 4nfich ii SUBJECT SITE The City of Oshkosh creates and maintains GIS maps and data for its own use. They may show the approximate relative location of property, boundaries and other feature from a variety of sources. These map(s)/datasets are provided for information purposes only and may not be sufficient or appropriate for legal, engineering, or surveying purposes. They are provided 'AS -IS" without warranties of any kind and the City of Oshkosh assumes no liability for use or misuse. JAGISXPIanninglPlan Commission Commission Site Plan Map N A lin=0.01 mi 1 in=60ft Printing Date: 8/25/2016 Prepared by: City of Oshkosh, WI Oshkosh 0 t _ t _ y � Y ` 1� ver - �� •J�'. b� � �g{�yY_� 6_ [, - yv? 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JAGISTIanning'Plan Commission Site Plan Map Template\Plan Commission Site Plan Map Temolate.mxd 120.0' 92.1' 50.1 $0.1' 40.0, I I Icer �ichnrohF 10 MEN The City of Oshkosh creates and maintains GIS maps and data for its own use. They may show the approximate relative location of property, boundaries and other feature from a variety of sources. These map(s)/datasets are provided for information purposes only and may not be sufficient or appropriate for legal, engineering, or surveying purposes.. They are provided 'AS -IS' without warranties of any kind and the City of Oshkosh assumes no liability for use or misuse. . JAGISIPlanninglPlan Commission Site Plan Map Map Template.mxd N lin=0.09 mi 1 in = 500 ft Printing Date: 3/30/2017 Prepared by: City of Oshkosh, WI deborahf 11 The City of Oshkosh creates and maintains GIS maps and data for its own use. They may show the approximate relative location of property, boundaries and other feature from a variety of sources. These map(s)/datasets are provided for information purposes only and may not be sufficient or appropriate for legal, engineering, or surveying purposes. They are provided 'AS -IS' without warranties of any kind and the City of Oshkosh assumes no liability for use or misuse. JAGIS0anningTian Commission Site Plan Map TemplateRan Commission Site Plan Map Template.mxd 1 in = 0.01 mi lin=50 ft Printing Date: 3/3012017 Prepared by: City of Oshkosh, WI } i-. FIY Oshkosh 11— dohnmhf 12