HomeMy WebLinkAboutDiscovery Properties LLC.,Redevelopment of 105 Washington Ave 2017t � r
DEVELOPMENT AGREEMENT
Document Number I Document Title
Development Agreement between City of Oshkosh, Wisconsin, a
Wisconsin municipal corporation, and Discovery Properties LLC,
a Wisconsin Limited liability company
for redevelopment of 105 Washington Avenue and a portion of
adjacent State Street Parking Lot under Tax Incremental District #30
Being a part of Lots A, B and C in G. Papendeik'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 2nd Ward, located in the NE 1/4 of the SW 1/4, Section 24, T18N,
RI 6E, City of Oshkosh, Winnebago County, Wisconsin.
1 Legal D
VIIdIIIIRIIIIIIIIIIIII�III
REGISTER'S1C
WINNEBAGO COUNTY, W1
CORD O
08/04/2017 8,33 AM
REGISTER OF DEEDS
and Return AMAGES. I I
City Attorney's Office
Oshkosh, WI 54902-1130
902-0088-0000 and
part of 902-0062-0000
Parcel Identification No.
Part of Lots A and B in G. Papendeik's Plat recorded in the Winnebago County Register of Deeds
all being a part of Block 26 in the Second Ward, located in the Northeast 1/4 of the Southwest 1/4,
24, Township 18 North, Range 16 East, City of Oshkosh, Winnebago County, Wisconsin being more
arly described as follows:
Commencing at the Northwest corner of the Southwest 1/4, said Section 24; thence South 00°-15'-31"
,ast along the West line of said Southwest 1/4, a distance of 23.88 feet; thence North 89°-56'-16" East, a
istance of 1,789.98 feet to the Northwest corner of said Lot A and the point of beginning; thence continuing
forth 89°-56'-16" East along the North line of said Lot A, a distance of 119.43 feet to a point that is 59.67 feet
Jesterly of the Northeast corner of Lot D in said G. Papendeik's Plat; thence South 04°-59'-29" East, a distance
f 75.50 feet to a point on the East line of said Lot B; thence South 00°-45'-40" East along said East line, a
istance of 18.61 feet to a line lying 5.00 feet Northerly of and parallel with the South line of said Lot B; thence
forth 76°-35'-16" West along said parallel line, a distance of 144.54 feet to the West line of said Lot B; thence
forth 13°-24'-44" East along said West line and the West line of said Lot A, a distance of 61.86 feet to the
oint of beginning.
Part of Lot B and all of Lot C in G. Papendeik's Plat recorded in the Winnebago County Register of
eeds Office, Lot 4 and part of Lots 1, 2, 3 and 5 in L. M. Miller's First Addition recorded in the Winnebago
ounty Register of Deeds Office, all being a part of Block 26 in the Second Ward, located in the Northeast 1/4
'the Southwest 1/4, Section 24, Township 18 North, Range 16 East, City of Oshkosh, Winnebago County,
'isconsin 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 890-56'-16" East, a
distance of 1,789.98 feet to the Northwest corner of Lot A of said G. Papendeik's Plat; thence South 13°-24'-
44" West along the West line of said Lots A and B, a distance of 61.86 feet to a line lying 5.00 feet Northerly of
and parallel with the South line of said Lot B, said point also being the point of beginning; thence South 76°-
35'-16" East along said parallel line, a distance of 144.54 feet to a point on the East line of said Lot B; thence
M
South 00°-45'-40" East along said East line, a distance of 5.16 feet to the Southeast corner of said Lot B; thence
North 76°-35'-16" West along the South line of said Lot B, a distance of 5.80 feet to the Northeast corner of
said Lot C; thence South 13°-24'-44" West along the East line of said Lot C, a distance of 50.00 feet to the
Southeast corner of said Lot C; thence South 76°-35'-16" East along the North line of said Lots 1, 4 and 5, a
distance of 89.20 feet to the Northeast corner of the West 29.2 feet of said Lot 5; thence South 13°-24'-44" West
along the East line of the West 29.2 feet of said Lot 5, a distance of 123.70 feet to the Northerly right-of-way
line of Waugoo Avenue; thence North 76°-35'-16" West along said Northerly right-of-way line, a distance of
129.20 feet to the Southwest corner of the East 60 feet of said Lot 3; thence North 13°-24'-44" East along the
West line of the East 60 feet of said Lot 3 and it's Northerly extension, a distance of 107.52 feet; thence North
76°-52'-22" West, a distance of 100.00 feet to the West line of said Lot 1; thence North 13°-24'-44" East along
said West line and the West line of said Lots B and C, a distance of 71.68 feet to the point of beginning.
Lot 3 Legal Description
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.
Drafted by:
David Praska
Oshkosh, WI
DEVELOPMENT AGREEMENT
rt�
This Development Agreement (the "Agreement") is made this day of June, 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 $3,889,000.00 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
June 21, 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
I. 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
IN 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 portion
of the annual increment that is not part of the 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.
June 21, 2017
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
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 the 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 Comer of State Street and Waugoo Avenue, prepared
by AECOM, dated September 2016 and (ii) any Phase 11 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.::Y�xwe- 2, p , 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
Tenn would run 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.
in) Project 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,
June 21, 2017
and an associated parking lot with garages, and related infrastructure and site
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) PropeLty Propertymeans 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 assessed by the City of
Oshkosh, 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 except limited to the Tax Increment attributable to the Property and the
Improvements on the Property.
M
June 21, 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.
ii) The City Contribution shall be first paid to the Developer on or about November 1,
2018, 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
June 21, 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 if the Project's performance
materially exceeds the pro forma IRR, the City Contribution may be adjusted pursuant
to this Section.
ii) On or before the thirtieth (30th) day following the tenth (10th) anniversary of the
Completion Date or the date the Property as a whole is sold, conveyed, or transferred,
whichever comes first, (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. In the event that the
Test Date occurs due to a sale, conveyance, or transfer, then a subsequent Test Date
will occur on the tenth (loth) anniversary of the Completion Date . Notwithstanding
the foregoing, in the event that the Property is converted to condominiums, then the
parties agree that within sixty (60) days after the conversion, they will meet and in good
faith negotiate terms of the City's adjustment of its contribution to ensure that the
Project remains in need of TIF assistance. It is agreed that it would be beneficial to both
parties to begin to renegotiate adjustments to the City's Contribution Adjustment prior
to the conversion to condominiums, and the parties will make reasonable attempts to
do so to the extend it is feasible. In any event, the conversion of the Property to
condominium ownership constitutes a material change to the ownership structure, IRR,
and distribution of any City Contribution. Therefore, the City and Developer agree that
upon conversion of the Property to condominiums, the City may temporarily withhold
payments of City Contributions within the TIF account pending a resolution of the
renegotiated terms of the City Contribution Adjustment.
iii) In the event that 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.
0
June 21, 2017
iv) As used herein, the Approved Assumptions shall be according to the market convention
at the time of the sale/Test date, the present value of historic tax credits (93 cents on
the dollar for Federal and 60 cents on the dollar for State), terminal capitalization rate,
realtor commission 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
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.
7
June 21, 2017
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.
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.
June 21, 2017
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 arising 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
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.
M
June 21, 2017
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 the draft CSM in Exhibit A.
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
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,
10
June 21, 2017
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.
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,
11
June 21, 2017
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) City 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.
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
12
June 21, 2017
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
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.
however, the City shall
Involuntary Termination.
June 21, 2017
The District is involuntarily terminated or dissolved; provided,
first make all reasonable efforts in good faith to cure such
13
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 Project. 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 gxempt status that would cause all or any part of the Property to become
tax exempt; ar
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
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
14
June 21, 2017
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
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
"Y' 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 age, creed, ethnic origin or identity, color,
gender, religion, marital status, age, handicap, or national origin, and the Developer shall
15
June 21, 2017
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. 17-243 dated May 9, 2017.
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.
ii) Subsequent Transfers of Property. 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.
16
June 21, 2017
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.
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 54903-1130
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
[VA
June 21, 2017
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.
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
18
June 21, 2017
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.
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
19
June 21, 2017
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]
W
June 21, 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 P RTIES, LLC
BY:
Michael Goudreau, Managing Member
STATE OF WISCONSIN }
} ss.
COUNTY OF WINNEBAGO }
Personally came before me this
3� day of �Tc", P 2017, the
above-named Michael Goudreau, to me known to be the person who executed and acknowledged
the foregoing instrument.
Notary Public, State of Wisc ns'n
My Commission expires:_
21
June 21, 2017
Approved as to form:
By.
`,•....-L A. Loren§o,, City Attorney
STATE OF WISCONSIN
SS
COUNTY OF WINNEBAGO
CITY OF OSHKOSH, WISCONSIN
By:
Mark A�. Rohloff, City Manaer
By:
Pamela R. Ubrig, City Clerk
i 1,ereby certify that appropriallons are av&".
7ijlt, to ji,eut dairns on list m_and
Qcornrnenu their allowance,
A,
LI
Personally came before me this g�Z '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 Wisco41
My Commission expires: -7 74 r Ld- 0 1
I /
STATE OF WISCONSIN
SS
COUNTY OF WINNEBAGO
Personally came before me this _2Z�day of -Tl,, e- 2017, the above named
Pamela R. Ubrig, to me known to be the person who executed and acknowledged the foregoing
instrument.
Notary Publi/c, State of Wiscohsin,
My Commission expires:
W
June 21, 2017
EXHIBIT A
Description of Property
23
June 21, 2017
CERTIFIED FSURVEY MAP
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.
COii. - SW i/4
SEC. 24-16-16
CAST ALUMINUM MONUMENT FOUND
S0015'31'E
23.66' P.O.
f:NW
-___________________________.
I l N69'S6'16'E 1,789.96'
I
I
I
TOTAL AREA
42,204 SQ. FT.
0.969 ACRES
_WASHINGTON AVENUE
(PUBLIC RIGHT-OF-WAY WIDTH VARIES)
e\ t"' N89'56'16"Et 119.43' is s 59.67
BUILDING LIT 1__.;c
10,126 So. FT.
0.233 ACRES
o 144.;{ P1dT
ti/
c� a
µEST0UN0
DpG• N SS19 Rye
OF LOr CO i
e} "
EA A,,.,Z
L 151 ¢ D�SF' NO. PER E4 ,
N0. S1d7sQ
PAP&pks
V.
OU,N P V- l
1L
Sib' 91006.SH B�O'� U7
2
'
6,727
0.154
_L
E 100.0p.
-4; uLU.ER r I LOT 2
_ tIg�ADD 25,351 50. FT.
OT 3 - 0.562 ACRES
ET. 15' STORM SEVER
ACRES ,�, r S60PER DOD. N
• 'i'09'E
4_ N LOI..Z 3 H J 8071'09'V
T 15:40_
AS A SEPARATE DOCUMENT
230 OHIO STREET
w
1 `
,1
SUITE 200
SURVEYOR:
I
ACCESS EAS FO
f`ii;w
n I
AIR
BUILDING REPAIR PE
DOC. NO. 69567
'O
3/4' IRON REBAR SET -
P.O. BOX 1130
ON -LINE .1506" NORIHERLY
3
OF LOT CORNER
CUT 'X' SET OI -LINE &-/
5.0' WESTERLY OF LOT
I
I
I
l
CORNER
7
-SW COR - 5W i/4
SEC. 24-16-16
MAG NAIL FOUNO
TOTAL AREA
42,204 SQ. FT.
0.969 ACRES
_WASHINGTON AVENUE
(PUBLIC RIGHT-OF-WAY WIDTH VARIES)
e\ t"' N89'56'16"Et 119.43' is s 59.67
BUILDING LIT 1__.;c
10,126 So. FT.
0.233 ACRES
o 144.;{ P1dT
ti/
c� a
µEST0UN0
DpG• N SS19 Rye
OF LOr CO i
e} "
EA A,,.,Z
L 151 ¢ D�SF' NO. PER E4 ,
N0. S1d7sQ
PAP&pks
V.
OU,N P V- l
Z
Sib' 91006.SH B�O'� U7
2
'
6,727
0.154
_L
E 100.0p.
-4; uLU.ER r I LOT 2
_ tIg�ADD 25,351 50. FT.
OT 3 - 0.562 ACRES
ET. 15' STORM SEVER
ACRES ,�, r S60PER DOD. N
• 'i'09'E
4_ N LOI..Z 3 H J 8071'09'V
T 15:40_
" cacti WILD
ti/
EXCEL
N'3!24'44-
6D N,,}�21�21\66
��
40.00
y
__lN_q_ VG0O
6
Nig 35',6"W
,
A
"(61' NIDE PU6(k R/CNT pF�E
OWNER/SUBDIVIDER:
_NUE
LEGEND
® — 1" IRON REBAR FOUND
❑ — 1/2"IRON REBAR FOUND
X — CUT "X" SET
■ — MAG NAIL SET
• — 3/4"IRON REBAR SET
O — 3/4" IRON REBAR FOUND
D — 1/2" IRON PIPE FOUND
— 1" IRON PIPE FOUND
— SECTION CORNER MON. FOUND
l
L0 4-S00'45'40"f S
1 23.77' p,
-1 1n4' IRON REBAR F NO'-5'Zi
LO> CORNER& 1.4' WE T OF
g
'--LN76'35'16iW
5.80'
NIPE POUND
1R" F LOr Cn3.Z!.OU1N
41
I w
A /
a
29,2• 'V/ Z'i =��
W
9 ,
SIJ7621'
'NI3i,VL
W
NORTH POINT REFERENCED TO THE WISCONSIN COUNTY
COORDINATE SYSTEM, WINNEBAGO COUNTY. THE WEST
m LINE OF THE SOUTHWEST QUARTER HAS A RECORDED
g BEARING OF SOUTH 00'-15'-31" EAST.
60' 0 60' 120'
1"= 60'
SCALE FEET
LOT 1, LOT 2, AND LOT 3
EXCEL
SUBJECT TO "CROSS
,%M 5
FOND 54935
FOt4D W IMF.
ACCESS/CROSS PARKING
) 92
FAY MM 926-9601
OWNER/SUBDIVIDER:
EASEMENT" TO BE RECORDED
DISCOVERY PROPERTIES, LLC
AS A SEPARATE DOCUMENT
230 OHIO STREET
SUITE 200
SURVEYOR:
OSHKOSH, WI 54902
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
m LINE OF THE SOUTHWEST QUARTER HAS A RECORDED
g BEARING OF SOUTH 00'-15'-31" EAST.
60' 0 60' 120'
1"= 60'
SCALE FEET
�®
EXCEL
Alwa)s a Better Plan
,%M 5
FOND 54935
FOt4D W IMF.
ENGINEERING-
) 92
FAY MM 926-9601
SURVEY/NG GROUP
10.14 ME I 1 C 16C
Description of Project Plan
June 21, 2017
EHLERS
LEADERS IN PUBLIC EINANGE
July 27, 2016
Project Plan
Tax Incremental District No. 30
City
f
Oshkosh
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
Project Plan
Tax Incremental District No. 30
City of Oshkosh Officials
Common Council
Steve Cummings
Debra L. Allison-Aasby
Caroline Panske
Lori Palmeri
Thomas R. Pech, Jr.
Steve Herman
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 Thoms
Robert Vajgrt
City Representative
Winnebago County
Fox Valley Technical College District
Oshkosh Area School District
Public Member
Table ^=f Contents t^~
o��� ��
EXECUTIVESUMMARY ......................................................................... ................... -................ .............. .......... 1
TYPE AND GENERAL DESCRIPTION DFDISTRICT ........................................................................................
4
PRELIMINARY MAPS OFPROPOSED DISTRICT BOUNDARY ...................................................................... 5
MAPS SHOWING EXISTING USES AND CONDITIONS ...................................................................................
PRELIMINARY PARCEL LIST AND ANALYSIS ...................................................................................................
9
EQUALIZEDVALUE TEST .....................................................................................................................................
10
STATEMENT OFKIND, NUMBER AND LOCATION OFPROPOSED PUBLIC WORKS AND OTHER
PROJECTS................................................................................................................................................................
11
MAPS SHOWING PROPOSED IMPROVEMENTS AND USES ......................................................................
14
DETAILEDLIST OFPROJECT COSTS ..............................................................................................................
zo
ECONOMIC FEASIBILITY STUDY, FINANCING METHODS, AND THE TIME WHEN COSTS OR
MONETARY OBLIGATIONS RELATED ARE TOBEINCURRED ..................................................................
17
ANNEXEDPROPERTY ...........................................................................................................................................
I2
ESTIMATE OFPROPERTY TO8EDEVOTED TORETAIL BUSINESS ......................................................
3Z
PROPOSED ZONING ORDINANCE CHANGES ................................................................................................
Z2
PROPOSED CHANGES |NMASTER PLAN, MAP, BUILDING CODES AND CITY OFOSHKOSH
0RD|NANCES---------------------------------------------------J2
RELOCATION...........................................................................................................................................................
22
ORDERLY DEVELOPMENT 0FTHE CITY OFOSHKOSH .............................................................................
3
LISTOFESTIMATED NON -PROJECT COSTS .................................................................................................
I3
OPINION OFATTORNEY FOR THE CITY OFOSHKOSH ADVISING WHETHER THE PLAN |S
COMPLETE AND COMPLIES WITH WISCONSIN STATUTES 86j185 ......................................................
24
CALCULATION OF THE SHARE OF PROJECTED TAX INCREMENTS ESTIMATED TO BE PAID BY
THE OWNERS OFPROPERTY |NTHE OVERLYING TAXING JURISDICTIONS ......................................
25
APPENDIX A -TAX INCREMENT FINANCING APPLICATION ......................................................
26
APPENDIX B - MARKET STUDY AND INVESTMENT ANALYSIS REPORT (IC8)-38
PLAN COMMISSION PUBLIC HEAR|N8/M|NUTESOFAUGUST 2.2O16 ...........................................
5G
COMMON COUNCIL CREATION RESOLUTION {)FAUGUST 23.2U16 ..............................................
62
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 determination, the City has considered
the following information:
• 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
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 1 July 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 properly 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 fording 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.
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 2 July 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.
8. 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 conformity with the master plan of
the City.
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 3 July 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.
Project Plan T(D No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 4 July 27, 2016
SECTION 3:
Preliminary Maps of Proposed District Boundary
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 5 July 27, 2016
Tax, Incro.ment Districf #30 oil
Washington Building Rede-Velopmenf 611W
1
Parcel Identification* . I .. (%.h.k0sh
lide-nfilcati-on
Tax Increment #30 - Washington Building Redevelopment - arce
10 Parcel W owner. lacal•Addren, 9 Mprov. 0EqualizedW-1 .Description'
*NapWilue Vdlue Value lue uml, tr.d. '"'ng
V Dwelling Censar
02,� 'TorfAvE 000 -300
DISCOVERY F��ERTjffL�0, I05.V4ASi4IW. t3k)�� $40;0001 $�40,0001 B k6,Sk1MGTC0,I BUILDING d
•
2 020062-0000
2 .20000 �:VbF OGHKOSR 0 STATE S1 $01 $01 4 STATE STREET PARKING LOT C�MO
4: KIECKHAFER REV TRUST H XIP D 300 STATE ST* '$16,00 $ 10,5,9W 7$122,.. '122,,: 11 OFFICE SYSTEMS
S .�7+
TOTALS: 7
D-
LL -
n
"M
7'L
UJ
'w
-E
> Y,
Z
OE,,�
.. . . . . - - - - - - -
M
IRA --
N
�777
z
..........
4
qtl `13 17 LY 00A -V.
ti
EM
wK,
Mmit
-
a,
M N,
-M
L :,gend
c1T z_ I.I,U ff30 5oundary
Feet
0
5,
July;,2OU
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 6 July 27, 2016
SECTION 4:
Maps Showing Existing Uses and Conditions
V
AW04 'U ..a
ay 7�
LLI
1? :k2a
C CLr.
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 7 July 27, 2016
oil
11
it
•
---- R.A.
a ml
a■a
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 7 July 27, 2016
Tax, Increment District #3Q
WO-shi'rig.ton Building O
Redevelopment
d..,,Vevlopme. nf
Existing Conditions
^A
C -1 W.
"' " 0:
657 ko* S h
TID,#30 Boundory
0 2$ 50
Eiel -1k.
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 8 July 27, 2016
U)
\
a
C:
k
%
-j
�
/&
2\
{/
Q
43
{\
\\
{\)
�
\\\
ZI
�.
\\\
\\
(\
: /\§§§
e\\
:k
§a)
/)
og
\))\\
\
] )
§\!ƒ
�\)
\\)
%o
® '
\co
/&
{/
Q
43
{\
\\
E
ZI
\\
(\
a.
e\\
T\
§a)
/)
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 permitted
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 o
9/1/2016
Valuation Data
Currently Available
2015
IN -12M
3,743,645,b00„
449,237,400
Percent Valuation Data
Change Est. Creation Date
449,237,400
Total Existing Increment
245,544,700
Projected Base of New or Amended District 561,270
245,544,700
Total Value Subjectto 12%Test 246,105,970 246,105,970
Compliance
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers 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,
stormwater 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 permanent easements to allow for installation and
maintenance of streets, driveways, sidewalks, utilities, stormwater 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.
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 11 July 27, 2016
Site Preparation Activities
Environmental Audits and Remediation
There have been no known environmental studies performed 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 stormwater 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 provi4ed 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.
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 12 July 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, permits, 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.
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 13 July 27, 2016
SECTION 8:
Maps Showing Proposed Improvements and Uses
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 14 July 27, 2016
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 15 July 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
Total Projects
678,901
Notes:
'Reflects City contribution requested by developer and listed within the "Tax Incremental Financing Policy and Application" dated April 30, 2016.
2Projected incentive amount based on 25 years of tax increment after recovering all other City costs.
3Calculated by Ehlers.
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 16 July 27, 2016
Projected
Project ID
Project Name/Type
Total
Year
1
Parking Lot Reconstruction)
88,000
2016
2
Development Incentive2
530,739
2018-2042
3
Administrative Expense
36,000
2016-2042
4
Interest on Advances3
24,162
2018-2037
Total Projects
678,901
Notes:
'Reflects City contribution requested by developer and listed within the "Tax Incremental Financing Policy and Application" dated April 30, 2016.
2Projected incentive amount based on 25 years of tax increment after recovering all other City costs.
3Calculated by Ehlers.
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 16 July 27, 2016
SECTION 10:
Economic Feasibility Study, Financing Methods, and the
Time When Costs or Monetary Obligations Related are to
be Incurred
The information 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
commitments 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 Plan. 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.
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 17 July 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 form 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 determines
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.
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 18 July 27, 2016
Development Assumptions
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 19 July 27, 2016
Construction Year
Ua
20 Unit Apt.
Buildings
Annual Total
Construction Year
1
2016 y
856,287
856,287
2016
1
2
2017
0
2017
2
3
2018
a
0
2018
3
4
2019
0
2019
4
5
2020 c rt; �r�
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
w _
0
2028
13
14
2029
��
0
2029
14
15
2030._!_
v
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
w.
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
J
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 Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 19 July 27, 2016
Increment Revenue Projections
Type of District
District Creation Date
Valuation Date
Max Life (Years)
Expenditure Period/rermination
Revenue Periods/Final Year
Extension Eligibility/Years
Recipient District
TiSEha4ni![3 PiE `�""
"triem`h 3016 .''
d ,,a&i3iZ43B�-
{
Base Value
Appreciation Factor
Base Tax Rate
Rate Adjustment Factor
Discount Rate
INIl c #oty Basa"�it I
Construction
Inflation
Total
Year
Value Added
Valuation Year
Increment
Increment
Revenue Year
Tax Rate'
Tax increment
NPV Calculation
1 2016
856,287
2017
5,613
861,900
2018
$25.95
'`` 223-:
21,916
2 2017
0
2018
14,232
876,131
2019
$25.95
2213;.
-"
43,746
3 2018
0
2019
14,374
890,505
2020
$25.95
z3zQ$
65,489
4 2019
0
2020
14,518
905,023
2021
$25.95
23;.4,
87,142
5 20200
2021
14,663
919,686
2022
$25.95-3;86
108,705
6 2021
0
2022
14,810
934,495
2023
$25.95
2$. ,
130,174
7 2022
0
2023
14,958
949,453
2024
$25.95
>
151,548
8 2023
0
2024
15,107
964,560
2025
$25.95-.^150_.
172,827
9 2024
0
2025
15,258
979,819
2026
$25.95
25`
194,008
10 2025
0
2026
15,411
995,230
2027
$25.95
- ,.�
215,090
11 2026
0
2027
15,565
1,010,795
2028
$25.95'
Z6?29
236,071
12 2027
0
2028
15,721
1,026,515
2029
$25.95
fi3,
r��
256,951
277,728
13 2028
0
2029
15,878
1,042,393
2030
$25,95
14 2029
0
2030
16,037
1,058,430
2031
$25.951
d'6
298,401
15 2030
0
2031
16,197
1,074,627
2032
$25.95
7
�; 2 7885
318,968
16 2031
0
2032
16,359
1,090,986
2033
$25.95
339,429
17 2032
0
2033
16,523
1,107,508
2034
$25.95
. ,, 8 73,.:
359,783
18 2033
0
2034
16,688
1,124,196
2035
$25.95
29=.- ..
380,028
19 2034
0
2035
16,855
1,141,051
2036
$25.95?9a
400,164
20 2035
0
2036
17,023
1,158,074
2037
$25.95
420,190
21 2036
0
2037
17,193
1,175,267
2038
$25.95
z ��3T
440,105
22 2037
0
2038
17,365
1,192,633
2039
$25.95�r.
459,909
23 2038
0
2039
17,539
1,210,172
2040$25.951
dQ
479,600
24 2039
0
2040
17,714
1,227,886
2041
$25.95
3f862
499,177
25 2040
0
2041
17,892
1,245,778
2042
$25.95
.3132
518,641
26 2041
27 2042
0
0
2042
2043
18,070
18,251
1,263,848
1,282,099
2043
2044
$25.95
$25.95
. `32,7395)
9
537,991
557,226
Notes:
'Tax rate is actual rate for 2015/16 taken from the City's Tax Increment Worksheet (DOR Form PC -202).
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 20 July 27, 2016
fn T
YO
N
CA
ON
0
O
T
N
M
0-
N
U
l0 n CO a> O
'i N m i m to
n co m O
N m <t m tO
n O M O
M aa
d' V a+
77
m
o o O o 0
N N
0 0 0 0 0
N N N N N
0 0 0 0 0
N NN N NN
0 0 0 0 0
N N N N
0 0 0 0 0 o
N N N N N N
a
Kv
o 0 0
N N F-
Y
N N N
mt0 00 t0 to
Ili tt 00 V m
d' N d' 00 'i
N m M N .-i
0) n O N w
m W n It m
It t ri ri n
m V N w M
't 0
O
_
c
LO tp O M V to
0 t0 O N
'i M m Q) O
O n N
N
u
U 'O
00 H r to 0)
111 e4 to N n
N to ai 111 O
a t` n
c c
0) O 0) 0) 00
00 00 n n w
tD to In d' V'
m N N 'i
0 m
a
0
0 0 0 0 0
0 0 0 o O
o 0 0 0 0
o o o o 0
o o o o o
0,6
m LO
y
n o
>
m
Nto
I 0
D
U
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
0 :Q
OM1 a)
n N
m m
Q
v1
O O M tl1 00
0
�t N 0) n 0)
w M et m N
to 111 0) n 0)
N N N m V
M 00 .i M n
M N O m Nr00
N t0 O 0
t0 N
''i
O
v
O O w m
0 0 M n .i
a 00 N w O
't 00 N to O
'd' 00 m n 'i
00 m
m
N N
W 'i N N M
N
t+l M V V 111
N N N N N
V1 Vl to to n
N N N N N
n r 00 00 0)i
N N N N N
'•1 N
M m
t\
r
0) N N
F aci
P
x
x
w
c
00000000000000000000
000000000000000000000000000
o 0
0
0 v
0
C
o a o 0 C
C C 0 0 C
C C C C 0
C C C 0 C
C C C C C
'
C
C
O 'i'
-i'.-+
c -I rl 'i
�-i '-1 'i 'i '-I
'iei 'i e-1 'i
N e-1
m U T
p m
a
•p
n v
a
B
o
t
c
O
o
O p W
_ J+ O
c C
O
00
00 0 O
00
U 0
h E
d Cp
>aj
u
c
U O M
E
Na
'i v n
m oo n
'i (0 N 0) n
n to t0 In N
t0 t0 n 0) N
to to In N to
O 'i n m m
t0 n n co of
N 0]
O 0
N v 0
t0
'" I
G C
m t0 r
00 0) O 'i N
M V m t0 n
M 0) O .i N
d� N
v
Ln tri m
tri tri W to t6
to to W to to
to tri N � r;
n
v
m
>.
4
CL
v
N
N N
uo
' ry
V
.tO
'i ci
n M M
M M n 00 N
'i 0) m n n
M 0) N M n
t0 tO n n 00
M d N Lt O1
0) 'i m M n
m m � n N
O 00 O O
N LD
tO N
0) N N
M '^ o
n O M
t0 W 'i V I �
O n'1 t0 01 N
u) O) N to 00
c
N 00 6 O)
to
n ;c _
o
D. 0i
Ln to to
to tri r' r' n
00 00 00 00 0)
0) m o 0 0
o
tri o
0
o M
m M
.0 N
ri 'i 'i
'i N '-I ti 'i
'i 'i 'i 'i 'i
N 'i N N N
N N N
N N N N m
U)
K c
C c
m ,y
�n c
O O N M w
O O LO m O
It N m n 0
w N d' m N
to m m n m
N N N m d'
m to O m N
w w 'i m n
W M n
m 'i n n N
O m m V O
t0 O V 0) V
N l0 m
t0 N M tp
W M n N
l0 O
0) tj
7
O O m n
w H NN M
a O N lD I
m t)1 d� V Ill
V 00 N t0 O
tr tl1 t0 l0 r
V
r r W W Ol
N
Ol O O O' c -I'
N m M M M
'-1 N'
M M m m
M v
co u
O
f
0 9
K
M
c
E
O O
D
O a
O S G
O )
O O
O
O `
v U'0
0
rn e -i
m a o
v c
LL
A �
m +L
'a Q
w �°
Q
� N
111 M 00
a m m n 0)
t0 �t M N
N to c) n m
N N N M It
in m O 0) N
t0 00 'i M n
0) -1 n n N
O M 0) cF O
N tD M 0)
W N 0) tD
LO m
tD c m
w
a
ID m O
m n 'i
00
; W N LD 0
d 00 N 10 O
d 0 M n It
t0 O �; 0) '
00 M n N
0) 0
'7
W
N N 0'1
N
M M V� d' 111
N N N N N
tl1 111 t0 to r`
N N N N N
N r oo 00 O1
N N N N N
Oi O O O' H
N M M M M
rl N N M'
M M M M
E u
n a_
W N N
� 3
�
c
o u
O
e1Nm
M m OO MaM
m m m mm
'
0)
0 0 0 0 0
0 0 0 0 0 0 0 0 000 0
0N
OOdENmm
O
N
oN
z � a"
fn T
YO
N
CA
ON
0
O
T
N
M
0-
N
U
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 conformance 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 conformance 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 conform to the State Building Codes and will be subject to the City's permitting and inspection
procedures. The proposed Plan conforms 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.
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 22 July 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.
Project Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 23 July 27, 2016
•fir. ;"{'r�� `, r,,,s,lV..,i
Oshkosh
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,
LL/ah
City Attorney
City Hall, 215 Church Avenue P.O. Box 1 130 Oshkosh, W1 54903-1130 920.236.5115 http://vv",v.ci.oshkosh.tivi,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 Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 25 July 27, 2016
.
..
._ ....
. .
Statement of Taxes Data Year:
9
Percentage
Winnebago County
;,::,-
19.73%
City of Oshkosh
;$�lD,U
41.67%
Oshkosh Area School
District'
m
34.63%
Fox Valley Technical College
$9;9 a ;=
3.97%
Total
98;4i?# 402,
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 Plan TID No. 30 Creation City of Oshkosh
Submitted by Ehlers Page 25 July 27, 2016
Appendix A
Tax Increment Financing Application
Tax Incremental Financing
Policy and Application
Please completeand submit the following information to the City of Oshkosh for a more detailed review of
the feasibility of your request for Tax Incremental Financin9 (TIF) assistance: The application -is comprised
of five parts:.
t. Applicant Information.
I Pr_qt
jec tPrp-pertyInformation
3, Project Narrative,
4.'Projectl3udgetfflinancid Information
5. Buyer CertificAtWh And Acknowledgement.
Where ,there.ishote Oughsp6cefokyotirrespoiise.oraddftloiiAIiiiforiiiAtioiiisre.qtiested,'Pleasetisean
attachment, Use attachments. only when necessary and to provide clarifying or add iti 10. a!
ft information.
Tie Ve&rtni h of Community DeVeIOprneAt .reviews all applications for TIF assistance.. Mlufe to
provide all required information -in a cojnlpleteand:accurate manner could delay Processing of your
application and-!) CD reserves: the, right to rej:ect!or halt processing: the -application, for incomplete submittals.
Forfafthdr. Iftforination please refer to the "City of Oshkosh Tax, Incrountal fliiandng-Policy' document.
Legal Name: Discovery Properties, LL..0
Mailing Address. 230 Ohio St #20,0, 0shkosh W154902
primary Contact 4 .920 230;5802 Cell 920 $79-9989
F V FAX #.
_M&Udrdaq@d'!pc6 ery-proo6dies.cob 920 426. 4606
Attorney; Jason Hirschberg
Legal Entity.- Individual(s)— Joint Tenants— T6iants in Common Corporation
LLC X Partnership— -Other
If nota Wisconsin corp oratiohipartnershiplUC, state where organized,
Willa new entity be created for ownership? YesNo—
PA , q,
cip, is of. existing or proposed corporation/partnersh p/lLC arid.extent of oivriership interest.
Name- Address: Interest:
Mike Gotidreju 230 Ohio St.#ZQO, Oshkosh W1 54.902 co-owner 5.0%
Randy 8' chmiede i I 230 Mott #200, Oshkosh W1.54902 2b6=bvinOr 50%
is: any owner, member, stockholder, pArtnei, officer or director of any previously ideirtified entities, o; any
member of the finmed We faixiily of any suchthe No
person, an employee of -City of b.slikosht Yes,
If yes; give the,nAme.and relationship of the eriiployee;
Have any of the applicants (including the principals of the corporation/p4rtiie,rs.iiip/LLC), ever been
charged or convicted of'a misdemeanor or felony? Yes. No X
If yes, please furnish details;
Page 26
DISCOVERY
PROPEIVIALS -
Date: 6/1/2-016
RE; ,Summary Letter W Washington Ave -:TIF Application
C/0-1 Mark Robloff
City Manager — Oshkosh; WI
2J5 Church Avenue
Oshkosh, W1 54903
Dear: Mr. Mark Rohloff*
We buiribl. subrnit.fo y
y yourreview pr9jecf-that we believe will significanil contribute to. the downtown revitalization efforts and
hope that the community might
view this pIroject ffivorably enough to utilizeTax Increnental.Finan in to help bring h1i9.-)
roject t
o
ftiti6n. We are. proposing toxenovate thesemiwabandored Washington BuWir- located at 105 WAshington Avenue, into. 20 new
high 6ad iiput ents. In, addition we prop . �
meto acquireaportfonof the city-ovniedpArkiiig:lbt�dj8c&httaouebtiUdiiig,86 t'�bawec n t
provide 20 garage,units As well-asxecondition and landscape the entire parking. lot in*cluding a Iftbe: portion that the city would retain
. for p0bli&.u§e. This historic renovation.and updatingof public space will serve. to -remove blight.atid r urpq�e a building that has
u
significantly fallen, out of use due to substantial deferred maintenance and hope that you will support out efforts..
Nam e of Developer & Owner.'Discovery Pro ert es LLC (Mike GQLtdreau and Randy Sduaiedbl Co-Developbrs / co-Own&s)
Description of Site/Buildftig.:Tl e Fraternal Reserve Association Ruilding consists of 29,10.0 Sq. Ft, of vacant office space and sits on
apar cel .6froughly 10,424Sq. -Ft. located at 105 Washington Ave.nue. Tlne adjacent parking lotto ft-ir south isroughly 3l,400 - Sq. ft
Curi-cht&Pr6pos6d Uses: The: bbstr6cen't use was as office space however has:sat vacant the past .several years. Woare proposing
to tut nrnar.,itIntq* h ketratea. *arttneiif units.
�
,Description. of Ewid.Userk- With our planned high=end finishes and price. -points, we are anticipating possibly young professional or
more. mature tdr[Mts or empty-nesters.that rilightbe looking to downsize from homeownership and take advantage of all the amenities
vibrant downt6willivinglias to offer.
P . rpj0tStart & End Dates. Decopstruction and some construction efforts, have already begun, We are anticipating a latefall early*
winter 2016 completion. date.
Descri i)iitrQsidcnts 11 support downtown business expansion and
ptim of Public Benefit (job Creation The Fulkiffie professio will
contribute.posit'vely.to but, Utbah ReviWization eff6fts. The multi-millidn-doll.ar redevelopment costs.-wil[bringP iiiiinediateimpact .to
construction revenue in Oshkosh provid i g for dazens of local btisindssesi and families in 2016.
Overyiew of Private Sector Fundina and Total Development Costs: Choice Bank willbe.ourprivate financing partner ror the
prpjact. providing A, $2,025,000 100, An a§.qfyet tpbedetermined brivate-equitypartner will provide an estimated $723 000 and
receive the benefit of the I b Istoric tax credits'. Finally, Discoery PKQPPi ties will make a capital, investment in.1the amount of $1 ruillion.
to.coverthoroughly $19 milli h total j t: d I eht costs.
pr'ojec. I eve qpIn
Sunimaryof*lnctefiient.Pe4jiectibiisfiiidTIFAssi§tgncieRetidested. Overthe next 2.6 years, we est4nate.%A.144 of additional
tax increment to be gonetvitq&b this t W ti 471,858, as: a PayGo note to be
y, projep,, e are requesting the Rill 75% of the increment, or$
paid over the course of the,25-yd# payback period..
The `But For' Provision-.* The Washin,&n bui.ldit.1g.is, listed orithe Nati6naIPark Service's Register ofl4istoricEfI Places..As-a
historicEd,preserwitibh-pr I oJect significant additional expenses have been ideutifi6d toaccommodate unique;requirements. to maintain
as*much ofthebistoiicatfabr'ic-as'possible; -Wbild We Will.be obt4iindr.tax credits that will help in.offseffing1hese,costs, without. TIF
assistance W.6 estimate that. this, project
dct Woul . d. -y . lelda-13.48%.10- ear internal rate of return...Rytm with. -the -'TIF assistance-request4.:
the 1.0.year internal rate of keturn:i§ only 4122%. We initially und&took this project believing the historicIax credits' would be.enough.
to help overcome the increased cost of renovafilig an: old building. Flpwe'v after deconstruction, 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
Tax Incremental Financing
Policy and Application
Overall Project S umary and O�jectives: Renovation'of the Fraternal Reserve Association Building located at
-
105 Washington Ave from a roughly AJ00 sq ftVacahtcbMM6'r'CIal office space to 20 high end residential
apartmen' t units. In addition we will acquire a portion of the city owned; ot on which 20: new garage units will be
constructed. The lot will be -repbved:and substantial landscaping Will be installed. The city wilfretain approximately.
28% of the refurbisheFd, lot: for public use.
Current and Proposed Uses: The building most recently was used asoffice space however s.at.vacant for the past
several years falling into foreclosure. The building Willbe renovated into 20high-end apartment units. The city -
owned lotbas.been used for public parking, Roughly 126/o of the tot will turn private and house garages while the remaining;
portiori will .stay 'puWc parking.
Description of End Users: The high-end proposed along With uniqueMiews and close proximity to:a host
of downtown amenities are likely to drawyoung professionals or possibly pear to retirement individuals looking to
potentially downsize or Ret out of, the responsibility of.home ownership.
Property Summary:
Parcel/Land Area: .41,814 SF
tuildi ngAr a-.29,100 SF
#.of DWelling. Units: 2d
#.of.Stories: 5
# i)fParwg Spaces-. 1. 81 &:20 Garages
Describe any zoning changes that will be needed:
.0roposed.Use is co'nsistentVith,present -0=3-Zoning
Identify any other approva.18, pernifts or licenses (i.e. Liquor License, Health Department; etc):
Oescrjlbebrjefly what, the project. -W. do..for the.pro.pertyand neighborhood;
With fiber broadbaridaonriiectlons.;,& a modern urban:feel, we feet this. space: will be
positioned.todraw professionals from many of the downtown businesses such as DealerSocket, 4 Imprint and
Silver Star brands to bedomefesidents.+of our downtown -fabric-, Fulktfmeprofessional residents. will support
downtown business expansion; and contribute positively to our Urban Revitalization efforts.
29
Tax. incremental Financing
0.
Policy and Application
Project TirActablo Date
Phial Plan/Specification Preparation.- May 1:5
Bidding and Contracting;,. May 3p
Firm FinancingAppyoval:June 10
Construction/Rehabilitation::',
'Landscaping/Site.Work: MY -.Aug
Occupancy/Lease.Up: Sept
Development: Team
Developer. -Mike Goudreau and Randy -Schmiedel
Architect Excel
Surveyor: Martensoh*&Elsie
Contractor: _RH Design
OthO. Members.,
Describe Team expertise and experience i.n. developin, iffiflar.pxbjects: Discovery -Properties owns over 90 rental properties in ushkosh. Mr, Goud tea.0 and Mt. 8bfiffiledel recently
were involved with the.Riv.effro'nt senior apartffients along with numerous offier developments in Oshkosh,
Other cufrdnt.Tewn' projects. 1.11 development;
curr.ently considering other development opertunlUes
.-Financial ability of the applicant Io complete the project:
100%
Full and part -tittle jobs to be created by the proposed estimated salary:
_
This develOpffignt is fikely to deate an addiflohal 0,5 FTE formna'ement of theproperty and another 0.5
FTE for the maintenance and general upkeep.
proAssional Studies
Market StudiegApplicatI6iis*for commercial ani resideritial projects iiinstincludea comprehensive market
study: The market study must identify target markets, analysis of competition, demographics, Marktt. ients"
letters of intent/interest from.,pro4pective tenants, or for housing developments, sale prices of rental rates of
.Comparable properties.
App,raisal: AU!prqjects that involve the transfer of land must include a.recent appraisal. Projects that include
lan& A&A.f6rin of equity -oil collateral nuist also submit a..-receht appraisal. The appraisal must value the. property
as is", and the impact on -value must be coilsidered-for such items as demolit on environmental remediatlon,
relacitioll of utiltilesi lease buy-outs, and other work necessary to makothesite developable. Viepr6perty
must.be valued assuming that the highest and best use is the proposed use.
30
Tax
Incremental Financing
AD
Policy and Applica#ion
Sources and. Uses of Funds
% of total project costs
project. uity; lender financing,.
Identifv the -sources of funds used to finance the . projectTypical spiarcesindude-eq
mezzanine financing, government financing, other anticipatedtypes of public- assistance, aq&any.othe.r types.
or Methods of financing,
Developer Equity:
Uses of Fu" nds
-Amount
$ per SF of Bulldlng Area
LandAcquisit'
$214,399
$7.371 SF
910
$10000
$3,72/ SF
Environmental Remediation:
$31;000:
$..1.071 -5F
Site *ClearAnce and Preparation:._-
.$30,000
$1403:1 SF
Soft Oostsl F&S.
$501,557
f SF
Soft Cost Contingency:.:.
$40,000
$1-37 /'SF
Hard Construction Costs*.
%8'76.1 SF
Total Project Costs-
$8j889,691
$136.65 /.SF
Sources of Funds
% of total project costs
Equity
Developer Equity:
$1,033,788
26.6
0/6.
other Equity;( HTC Equity investor j
$742,845
191
910
Total Equity:
0
Loans
Rate Term
Cobsuacti6n.Thioncing;
mos.
Permanent Financing,
$1,025,000
_4.5 q/. 25 yrs. 52.1
TIF Assistance
$ 4*71,888fpaygO
%
Other:.(bty'Lot ReconcilfiaUon j$
67j468
:2.2
%
Total Sources of Funds.
1000/0.
Financing
Source Amount Te.rms: YearsOnterest, Contact Information
Equity: Discovery PrOPerfles Cash mgoudreau@discovery-oropertiet.com
Loans 1: thpice: Bank 25 Y6arsi,@.4.5%' 920:-267-8050
�3:
4:
31
Tax Incremental Financing
Policy and. Application
Detafled.Pro Forma (inust.correspond to line items for Uses of Funds on p. revious„poge)
Land Acquisition
$ 214;399
Demolition
.$.10x,200
.Site CIearance.and Preparation
Infrastructure
Utilities/removal
Utilitieslrelocatioi
$ so,bo0'
Utilitiedinstallatiori
$
Hazardous lvlateriats.Removal
$0T;000
Other( )
$
Total Site Clearance and Preparation
$383,599
Soft Casts/Fees
Project: Management --------------------
General Contractor
Architect/Engineer
106;706
Developer Fee (----21o)$
312`,00
Appraisal
Soil Testing
$
Ivlairket Study
$ 4,000
LegallAceounting
$ i.5.,obo
Insurance
$i1500
Title/Re.cording/Transfer
$ 5,060
Building Perinit$16,921
Mortgage Fees;
$ 2000
Coistrueticsn Interest
$ 6s;bob
Commissions
Marketing
$ 51000
RealEstateTaxes
:$10,733.
Other Taxes
$
`Other ( Historic. Tax: Credit Consultants
Other ( }
$
Sufi -total Soft Costa/Fees
$x1;557
Soft Cost Contingency
$ 40,000
32
40
Tax Incremental Financing
Ab
Policy and Application.
Pro'FormaIncome and Expense Schedule
...
Applicants.- h I retail, in r6t 1commercial, , stria �, or Vill its must, submit
du
at identify income fi
project pro forwas that me and expense projections. on an annual, basis fora ve-year
t . oa . maximum eleven year period. If you expect a reversion of the asset after a holdingperiod.please include
that in yourproforma as well.. 'Please.check with city staff to determine the time period needed for the pro
f6rina. Ideiitifyall assumptions (such as absorption, vacancies,. debt:scivlce, operational costs, etc,.) that
serve As the basis forthe, pro farinas, Wo sets of pro fofthas Are to be submitted. The first set shwild show
the project without TIF assistance And the second set with TIF assistance.
For 014jer-occupied industrial commercialprojectsdetallled financial infot ation.Ads
t be presented
that supports theneed for.ftnancialassistanee (see below).
010.
Analysis of FinancialNeed
Each application must include financial analyses that demonstrate the need for TIF assistance. Two
analyses must be submitted: oneWITHObt TIF assistance and one Wltil TIF assistaAcei The applicant
must indicate the ininimum return orprofit thappl .1 icat t. needs to proceed with the.pxoject aad rationale for
this minimum return or profit. The analyses will necessarily differ according to the type of project thatis be -
Ing developed.
Rental Property: For.prOJ 'ectsinvolving rental of sP acebythedeveloperto tenants include
retail stores, industrial companies, and households), .an internal -rate of return on equity must be computed
with and without TIP assistance, based on the :profb prepared for the Income
forma Of income and'expense
and Expense Schedule below. reversion at the end of the :ten year holdhig Period.inustbe based -on the
capitaliz I edlithyearneoperatingincoine. Ilie feversionar, cash..
rear flo-w
before discounting to present value. State all assumptions to the analyses.
ForSAIeResidential:,Shoxv,profitas,,A percent of project cost (minus developer fee and overhead and minus
sales c6ininissions and closing costs,:which should be subtracted from gross sales.revenue), Other measure
of profitability maybe
be sbbmitted, such as profit as a percent of sales revenue,
Mixed Use Coininercial For -Sale Residential :� Provide either separate. analyses for each component of the
1 ,) p 'er-t or indude in the.revenue sources for the far -sale portion, , the value- of. the commercial. comp orient.
70 p. n Poll
based on the net operating income, of the com-t.nerpial spate at stabilizadom Indicate.hOW the sale valut.was
derived.
Owner-Occupie'd Commercial-. For projects, such as "big -box" retail projects,
ects, provide copies. -of the analyses
that the company needs; to meet or exceed fliecompany s m in unuin investment threshold(s) for proceeding -
with the project.
Cbrop0i . tive Projects- Ininstances wherelhe City is-competingivith other jurisdictions -for. the project (e.&,
corporate -head . Quarters, new manufacturing plant),, present detailed Analyses that demonstrate the capital
and operating cost differential, between the proposed locationW in Oshkosh and locations that are seriously
being considered by the applicant"
33
Tax Incremental Financing
0: 6,
Policy and Application,
Revenue Projections - Rental Project
Income rent per sf (oravg.)
Commercial Rent
,Commercial Expense Recoveries
Residential Relit
Qthef.AeVtjjUe Garage rent
Gross Potential
otentid Income
Comm (rcial Vacancy
_-1 0
Residential Vacancy 1,, I - 4 /0
Effective Gross hicoffie (EGI).
A
i2
Expei!O.
Maintenance. &- Remits
Real Estate Taxes
Iiisuraiice
Management Fee
vrof6ssional Fees
Other Expense ( utilities ktrash
Othera Ey
,p6nsg advertWng
Year I Y&,ir 2
211,008.
:$214,608
$_27,600
$ 28,069
$12,60.0
$138,608
$ 232j72
$1:1,930 $9,950
226,678 $ 232,727
$17,490
$17,665
0,733
$31,832
$12,60.0
$_12,120
$-94.520
$_14,665
$3,700
$3,737
$ n,040
$.29,330
$7,210
$7,282
Total Expenses $_24,693 $116,631
Net Operating Income (NOI) $_131,985, $ IM09B.
Capital Expeiis6s:(fe$erve$,.tetiaijt*i�izproveiii,etits,C61tinI ISMiOhS) $A,00
- 3,030
Debt Service. $_135,067 $135,067
Net Cash Ftow (before de 1. tion) $ 6
preda ;083) $122LQ01)
Reversion jin Year 10
-Yeqr.11:NOTb,q
fdreDebIOCOVNIExpenses $J-40,651
Capitalization Rate WO
GrossReversion
34
»Year :I1
$247,008
$
$268,209
$11,467
M8,269-
$19,320
$ 34,814
$13,255
$ 16,039
4;087
$12,078
$.7,964
$127,558
$14051
$_3,314
$ 136.06-7
$ 2,270
Tax. Incremental Financing
Policy and Application
Revenue Projects — For- Sale Project
Gross Sales Revenue
Housing Units Vnit.lWe Nuinb-er Price/Unit,
Total Housing Sales:.
*affordable tinits if,dny
Housing WtUpgrades'..
Conunercial Space
Total Co.nunercial Sales:
Total Gross Sales Revenue
Cost of Sales
C . oinnii8slons
Marketing
Closing
Other Casts (.
Total Costs of Sales
Net Sales Revenue
Unit Type Size-sf Price per sf
35
IYO
35
Tax Incrementatfinancing*
Policy and Application
Summary Letter.
Provide a summary of the projectin the form of a letter addressed to the City Manager.Tlie letter should -not
exceed hvo (2) pages in length and should include., only the following essential information about the project-
• Description:of siteor building Overview of private -sector financing
• Current andproposed uses • Amountof TIF:assistance requested
• Description of -end users • Summary of increment projections
Project start and end dates Name of developer and owner.
. Profitability • Total.development costs
Description of.public benefits; + Statement regarding ivliy TIF"is essential.arid why
_including job creation. "but for" provision will be met.
Note: Inthe "but for" discussion you must clearly describe why TIF is needed to help this project and
vhy the project will not/cannot proceed without. such support: Failure to elearlyprovide the
"brit for" explaizatioi will delay action on.yaur application,
Project -Narrative
Provide an in-depth overview of.the project in narrative format. Ihe narrative -must include a:description of
the followuig aspects of the project:.
• Current condition Of the site.and historical ove2"view that includes the size -and condition of
any existing structures,:environmentat conditions., and past uses. of the site:
Proposeduse(s) .of project (e.g. industrial, commercial,; retail,. office, residential for sale or
forrental, senior housing, etc,)
• Construction information about the project Including. size of any existing `structure to be
demolished -or rehabbed; 8ize,of anyiiew construction:: types of construction materials
(structural and finish);. delineation of square foot allocatioii by use•, total: nurriber and individual
square footage of residential units: type of residential units (e.g. for -sale, rental, condominium;
single-family, etc); number of affordable residential units; number and type of parking spaces;
and :construction phasing.
Tf in an existing TID or redevelopment area, confirm that this project is consistent svitli the goals and
objectives hi the Project or Redevelopment Plait.
• Asunimary of the proposed "green" features to be included in fhe project. All projects.that receive
TIF assistance are encouraged -to include environmentally friendly features.
Page 36
16
Tax. Incremental Financing
Policy and Application
Filing Requirements
You must
provideallof:the foUpw�ng.Itemswifh.ybur.sgiitaapplication:
1.,Fee., A-ii:application fee. of 1% of thexpquested TIF assistance or $10,000, whichever isgreater greater.. This
fee- Is to cover City co s-tsassod ted with, evaluating, ibe TIF application and does not cover the
use. of outside consultants, whichif required will be paid for by the applicant. Iviake your
checkpayable to the City of Oshkosh.
2.Site maps t,pr . Provide a map that shows the location of the site Alsoprovide a map that focuses on
the project and its immediate surroundi
igs. 13othmaps:should bon.olarger than
11X17 inches. larger maps will berequired ,f(orprp)ec.t
spreset ited tbthe.Plaa
Commission, Redevelopment Authority, or -Coininon. Council.
j
3.Pr Project Provide :
0drawings, plansand renderings for the.
es. Larger
-be no larger than inchmaps will be required
project. These drawingsshould n
for Projects presented to thd,Pla C Redeve P ent
11 ommis ion Authority,or Coninion
10
council.
Notes
The. City charges an administrative fee of 51/6 of the annual tax increment revenue.
If the projectxequires* pl. ninan h d these applications concurrentg an. zoning approvals, you must make
with,thi
s request
Agreement
I, -by signing this his application, agreeto the Mowing:
J. I have read and will abide by all the requirements of the City for. Tax Incremental Financing.
2. The. J. I nfOrmatton sr bmitttil is .correct,
3. I agree to,pay all costs involved in .the legal :arid fiscal review of this project, These costs may
include, but not bt,limited-to, bond counsel,. outside legal assistance, and outside financIA
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 finwalapprqval, Pre regardless f lim
..0 .. Mary
Approval or the degree of construction completed before.. application for final approval.
5. The undersigned authorizes the City of Oshkosh to.checkcredit references and verify financial and
1Z
other information,
6. The undersigned also agrees to provide any additional information -as may be -requested by the. City
Aer filing of -this application.
Applicant
Page 37
U6116MEMOM
Market Study and Investment Analysis
Report (Invests -Analytics)
*INVIS'�TA
ANALYTICS
Page
Prepared Exclusively Farb
Mr. Michael Goudreau and Mr. Randy Schmiedel
Discovery Properties, LLC
Prepared By:
Timothy M Hess, PhD
.Invista Analytics, LLC
member of
inf
e
Page 38
CONTENTS:
Introduction1 Objective.........................................................................1
MarketStudy.........................................................................................1
ProjectValuation................................................................................4
LotConstruction Analysis.....................................................................5
OverallInvestment Analysis.................................................................7
Potentialincome..............................................................................7
Budgetand Funding.......................................................................8
TIFFunding......................................................................................8
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 information was then utilized to create an operational proforma and investment
analysis for the operation of a residential re -use of the Fraternal 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 TIF 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. (nista Ana-
tytics 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, lA acquired the Apartment Data - 4 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 100 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
tow -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.
l.'httpJMMw.d.astdmsh%i.us/assessodasseW(3o% *WslApannwnts 4up.,ds'accessedApri10,2016
105 WASHINGTON AVE INVESTMENT ANALYSIS
Page 40
Figure 1: Potential Compariable Apartment Locations
For each Of the remaining
ining comparabIe subject properties an on-line search was conducted to.
obtain I information on the characteristics of the types of pfferin6s,. amenities and rental rates
for each of I the p properties had e
properties, Most of. the Prop their own website that contairied.alf of
the Information needed, Two had the Information listed on the third party website, apartments.
com. Forboth the 100 N Main aril Anthem properties, a 'range ol'-rents were given fortheir
room types. In this caisew.e.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
tied to an econometric: quantile regression modal that used 611.6f the
covatiates to ptedi-elt the rents with the ext6ptlibn of parking. While sevi.faiof the units offer un-
derground pdricing, the rents used in the analysis were the base ratio which includes surface, lot
parking. Thus the model sought to estimate the iox'pected rent At the subject property Without
i(44 garages that Will. be available.
Given the Beach building boa yet to be placed In service, ambigh.ling was -applied to eachprbpeTt . yto . carryout . . t . he e9tim8tion. The Beach building units receiv6dza weight of 0.25, while
all,the other properties received at.welght of 1.0. The resultant modbi parameters were then
used along iMth the covarlate 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
$1 -22,$903 -and $1,027 Pei month respectively' for the one, two and three bedroom
These estimates represent the predicted monthly rent One might expect . to . pay given the par
,flddl6rsof the units .that Wouldbe available assuming they are offoughty:similar quality as the
comparable properties with outside lot. parking. The developers Intend to secure the adjoining
parkin . g tot,to.the subject site from the City OfOshkosh and build 20 garage unittilOgpch of
single and two carg . arages to servicethe'subject property tenants. A number of tho-compara-
.
ble properties offered underground parking for additional fees. The ratesarb given In the data
table on the following page, It was noted that .th_ese. parking options are leased porstall.,
2
I INVI5TA-ANALYTiCS.60M
Page 41
M
°
C
�
c
�
j
t
v
40
C
c
c
} m
c
c
c
o
03 N
u
a
i1
O O
c}
H
O z
❑
T
U C
A
G
C
c
} V
l
°
E
c
c 4
V
xf�
in
K
4
E v 3
o
°c
c
c
c a E
3
O,
X N
bH
N
O Z
G
? c
c
G
c
c (] G
o
W
t
b
S A
L
M
N
9 o
o
c
V
O
C E R
ry
E
E c
zm
C1
?E
n
£
m S
::D
p0
,,,
ti
N
va
C
3
c
u o
T c
o
v
u
u
1.V
'��
c
W
E N n
;fi l
O ro
�
_
"
O
L. 04 Q N
V u
v
U
y
U
i.�}�
c
° c
A
c
W
d
C1 O1w `
}
n
c
C
T
}
}
b rGGG+
c
m
N V
L
« n
m
■N1
N
N
a
r
c
U c
}
c
C
A}
a'r
a 3
°
=
o
n E a
G
°
L2
Y
= E 8 L
--
o
T c
c
c
T
u°
T
1p U V
C'N',
Y C u
N co
m
g
C
w
n rj
N
ae
A
pUp
U
m
N
105 WASHINGTON AVE INVEs,rMF_NT ANALYSIS
Page 42
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 $160 per month.
These rents, for both the residential units and the adjacent garages will be utilized in all subse-
quent analyses,
PROJECT VALUATION
Any proposed TIF assistance requested from the developers will be subject to the city's 76%
rule which states that at most 76% 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 106 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 NOI via the formula
NOI = EGl - (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.
�` ;x,- r �`^r�r�''�_+3Jrtoti fte8,lncome ,a, hCaTcul@uonfo%�sesstn�pt;Yaluattonf.r -t4 �'�"`.0 1>�nri�r �Gf;
�, E � ✓, .nY.�arr t .. I _
Years
Year2
Year 11
Amount Percent
Amount Percent
Amount Percent
EG(
226,678
232,727
268,209
Expense
94,693 41.77°%
116,631 50.11°%
127,558 47.56%
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,
I NVISTA-ANALYTICS.COM
Page 43
LOT CONSTRUCTION ANALYSIS
As previously Indicated, the developers are seeking to acquire a I portion of the City owned loti
located just south,'of the Was - hington, building, on parcel 02006 . 20,00% in order to provide ad-
ditional surface lot parking along with detadhed.garap units to service tenants of the subject
property. The city will,also retain a portion of the lot for public use; However, frorn an efficiency
that If -Substantial work Is lobe done on this. lot: that
d Id seem
substantial f
�'a� P�l t i'wou chat t k and the portion to be'retal ed b 1he
both ions e. t to be 6. develdpdr, h y
city, portions, t the
same
provide a reasonable attempt
be updated a fbilowawe attempt to provi
at accounting for the costs and befiefitsi to both theAeVeloperg and the. city:
To find a v luation of the potential acquisition of portion of the lot by the developers;we first
found some comparabld.privately-owried propbrueswith asphattpaving parking lots located
on them. T . hetable6elow-provides details on the comparable lots found on the 61(yAssegsoes
website jhctutiing. square footapand total asgessmehts:.Fjgure 2 below provides a map of the
p
comparable 10 . is along with the subject property,
From'these c6mparables we find an, average assessment of $2.64 per square foot: Applying
this';io the subject property With a. total of 31,'390.square feet results in a total valuationof
$82j901 for the entire lot.
Figure 2:
105 W.ASHINIGTONIAVE INVESTMENT ANALYSIS
Page 44
Owner
Map Ind
parcel
SCI A
Asmt
Asmtlsi;
Fdx Rivet DeVeloorhent
1
0400610000:
15,600
39,000
2,500
J West.Rentals
2
0401630000
7,440
18;600
2.500
BurnsDregon StILC
3
090000000
36,20o:
41,700
:1574
M.&DxMerprtses
4
0300996000
13;540
46,660
2.963
— T6tal
57,746.
1.39,30.0
2:641
I
City of-oshkosh
5
6100620000
31,39.0 x1.641=
_. $82'901
From'these c6mparables we find an, average assessment of $2.64 per square foot: Applying
this';io the subject property With a. total of 31,'390.square feet results in a total valuationof
$82j901 for the entire lot.
Figure 2:
105 W.ASHINIGTONIAVE INVESTMENT ANALYSIS
Page 44
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 8,844.4 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, while 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-ANALYTICS.COM
Page 45
Total Lot
City
Shared Garages
Area (Sq Ft)
32,160.45
6,850.00
4,188.80 8,038.88
Region
Blue - Flg 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, while 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-ANALYTICS.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.. anj es are
at full occupancy.: Thelabl,e on the following page utiiizes the predicted rents'for the apartment
pnitsand 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 WASHINGTON AVE INVESTMENT ANALYSIS �
Page 46
SC:I:'!r'.`:�:Y�:i:n_a.li?i:�'i �'n .:....i>:...::.:i:.:v�.ci ' '.�::.".::..:..
:�.�:..,..;>;::�>_.',;::...MaKtlllum.Rental,tnSail�Pote`iitiai;
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
$238,608
Residential Annual
$211,008
Garage Annual
$27,600
Data published by the CoStar Group on multi -family vacancy rates over the past five years in
Oshkosh shows a general downward trend with rales 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.COM
Page 47
.;;esaasx. <:•Deta
a Project Budget
- -
Dunt
Building Parking Lot
Combined
TIF
HTC
Notes
Acquisition &Site Pre
Land Acquisition
214,399
Demolition
108,200
1
1
Utilities/relocation
30,000
1
1
Hazardous Materials Removal
31.000
1
1
Subtotal
$383,599
0
$383,599
Softtosts Fees
General Contractor
1
i
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
WHEDAallows l2.15%
Appraisal
4,800
4,800
Market Study
4,000
4,0DO
Historic Tax Consultant
51,000
51,000
Legal/Accounting
15,000
15,000
Insurance
2,500
2,500
Idle/Recarding/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
IAM @ 3.95 for 6 mo
Marketing
5,000
51000
Real Estate Taxes
10,733
10,733
US
3/16/15-6/10/16
Soft Cost Contingency
40,000
40.000
Subtotal
5524,436
$107,121
$631,557
Hard Costs
HTC Allowable
1,887,372
1,887,372
1
1
HTC Nan -Allowable
273 50
7:13Z3
986.563
1
Subtotal
$2,160,722
$713,213
$2,873,935
Total Pro ect Costs
3068 75T
$820,334
93.889.01
Hist Tax Credit Allowable Costs
2,443,570
TIF Allowable Costs
3,292,639
:Source of Fundi
Permanent Finandng
2,025,000
2,025,000
Choke Bank
Proceeds from HTC Sale
742,845
742,845
Lot Recondlllatlon Funds
[-A
87,458
87,458
J
From Cityof Oshkosh
Other Cash Funds
300,911
732,876
1033788
Cash from Develo ers
-c of unds
3 068,757
820 334
3,899091
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 i % 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 Note payoff schedule on the following page.)
105 WASHINGTON AVE INVESTMENT ANALYSIS I
Page 48
INVISTA-ANALYTICS.COM
.0
t0 lf1 10 H Ol O M m d a0 n o0 M N d O O M O -11, d 0 [N` N
M lA h a fV w m m [� H 1G H n m Ol ID M O 00 l� tf M
ij
O m t0 O M l0 O1 Mn tM0 O n O1�l dIl� n1� H M M N W O d CO N ll
N N N N N N N iV N N N N N N N N N N N N N N N N N
'
� ul d O H 00 H O1 N W W N O M ae�t N tO n O d 0 O1 H t0
l0 h Vl d d n 0 W M N M InO l0 d d l0 O n �l lO N d H
IO Ol t0 M O n M N 0 00
G
G d
m
MN f df�t77 O
ti eH-I d c -I l -I rd -I H N H N .n•1 N N em•4 N N N N N N fV N N N N
'
�1 t7
d
H M N H n NN d tr N H IO 10 N N 10 m n M H H M n N n
r tt 00 M M M H N M n Ol Ol n M 00 Q
00 t0 ll' r-1 Ol t0 M O n m O �D M Ol f!1 H w N n N h N n H w
OS Oi OlOi 00 00 09 N l0 %S t!1 tri Lr d Q M t�1 N N ti ati
:'
'
w
M H M N H n N d M Ol N H l0 t0 N N W M n M H H M n N h
n n d 0 m N H N N O tO d N H M M H N M h pi m h M N 0
lb Op l0 V� H N l0 � O 1�� O l0 M 01 m H 10 N n N n N n H W
u U
01 Ol C1 01 [P 00 � N CO n n t` l0 l0 I+1 Ol I/1 d' d' M
C
Q =
t
C
2
CO H 10 H H al H O H lD d N d d H h M n pl n 1!f c0 m
M M O N M co d n l0 01 � M O d d N M Ol N d a1 m� O C
a
0
0
IfI M 1D tr; IJ1 O O M O O Q f -i �-1 m 00 N u t0 O 1A H N
H r1 Q 00 tc0� M O H lD O nl Oi Ol Ol
V V V M M M m m N N N N N H H
y
M ri C
s°
•G
lD N l0 H O1 O 1n M d N h 00 Irl N d O O M O H In d N [�
M N ^ O N l0 Ol M^ H m H h M O1 H M O 00 10 d M N N 10 t
O M n O d n H V1 N IO O d 00 IO c
[:
O M l0 0ON Ir•C W OL fffrRr�� III+D+�� w ONS
a V tli ui N N N N N 00 c0 N N f
N N N N N N N N N N N N N N N N
E
N N N N
N N 0.l N
u
p
um
m u1 N N m m m N M M N m In M N N N M IA mmM M t!I
Mon,
V1 m mrn
mmmm m Olt,
o—
k Wxx
r-mmmmmmmmmmmmm
h n n n, n h n h n n n n n n n n r n n n n
n n 161-
0 0 0 0 0 0 0 O' O O O O O [5 O P 0 0 0 0 0 0 0 0
H H H H H H H H H H H H H H H H H H H H H H H H H H
r
p
M N O N 10 d M O Nry Ol d N d Ol h O 10 !n N I!1 l0 H OryI H N N
r",
W N n V n e-1 t N uH1 0�0 N tmfl OM1 m O V W N tN0 O V
uu uQQ
u O
•�
M m m m M cm'7 m M M 0dn M 0.mi M M M M nnl M M co co M M V V
6
a x
.r
•
d d d d d d d d d dmind d
�1'^.ut'Z`Zul�h Mv�1���i,In inlnvl�v�v�lnlnln
v
p p
d d d d tT tf A AlA d d d d A V' a tf V V V d d d K A tt
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
H R
a
� n
'
C
I O d N m o 0 c0 N N n n N M N N H d n N H M tlI d M d
O n n H N OO H N at d (r1 \0 d 10 N d O H N O n Q Ql tY ul
N Ol n4 u1 CO d 0 OI M O M
U
m ko
P O M 10 O M m O d' 00 M n m w l0 H m rl n M 00 'd .4 t�
o
n W O1 H N m M h O N M l0 co Ol H N d M n Ot O
N
F
q
N N N 00 OI N Ol O1 N 01 m O O O O O O O H H H H H r--11
w m o
r1 N N ei N ri N N e-1 N e-[ rf ci H
O
O
3
p
tj
O O d M pp O'D co c4 n h co {r� N co H d n N H M VA d M It
O O h n N N H co M d M 10 d l0 N d O H N O o o Ol `a m
O d m d n O V1 N O1 N O1 H' O1 t!1 M c`( Ih M N It 0 O1 N O M
,p
p
ri O M c0 C] m I� O a 00 0 1"� e-1 IO ri l0 H tLl rf00' '7 e{' 7�
O1 H M m m 1+1 10 n o O H m td� n of o N 101 Ol M 101 10 1!1 00 Of H m t�
M M m M m m d d d d tY d d to N to M l0 tD
ri a ri
Q
n N Ol O H N m d N lD n N 01 O H N M d N i0 n N m oo rt N
�¢a¢aaaaaaaaaaaaaaaa¢a¢aaaa
m v vs n m
• �In-I .00-I p� o .� ry �0 v ��0ll w n w ul o .�+ v In oo o rl
.-1 N N N N N IV N N N N M M m M M m M M M M a tt
v oni v v v a ani m ani v m m eni a w w w ani ani 4) ani cai 4),N nan+ ani
N h N N to N N m !n h h h N H H V7 h N N h VI h h N h
lD n N pl O H N (tl d of c0 n N a• O H N M d N b h N Ol O H
H -i N N fV N N N N N N N M M M M m M M M M M d d
p
}
n
H H r
N N N N N N N H N N N N N N N N N N N N N N N N N N
r
n
V
m O n 00 m . n N QI O e-1 N M d M m n N M O
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 d
0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 4 0 0 0 0
N N N N N N N N N N N N N ry N N N N N N N N N N N N
H N M tt M c0 n o0 to O N aN-I H .d-i.n-I .N -t N N IV N N N
ta'
p
Y
6 r
Page 4 9
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 $23,263.
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 WASHINGTON AVE INVESTMENT ANALYSIS
Page 50
is
H o w 00
O
n
N
o v u� m n m a
N rl u1 m M n b
o0
Ln
4 a n
n H t0
00
00
O w O,
qq n N
U
d
M H
rq
N
M w N 0 0 0 Ql
m H H N N
Ln
mob} M O
N
?7'is
.'.f
!• d m N
yy
4 H
N yy
fNil
y yyy N
tG IN'1
.-1
N
y
??ti}
iN
N
N VF
w N d
M n
n
of Ot d O h H M
M
N H n
M
H O N^
�. d H t0
O N
N N
O
01
N w w d w w
H d e-1 w O n w
N
H w b
b oo O
b
N
U MM
M N
T e~i
hh
m
�/yytn� y
rM-1Minn
N
tH0 h M
N
y
y y
'
01 w M M
O w m
In n
N N
o!
Ol
01 w dm h w n
M
M
'7 I�
co
00 M M
M
n H
M
N M N O 4 O
m H o in{nn O V o0
R
O
In 10
Ippnpp N O
M
N
i;
M N
N y y
T eHi
N N
coM
N
rw-1Vd} M N
y y y y y
N
H
In N
H
N
N
y
N
y
N
y
y
s
0o n m
O M of
01 w
M M
.4
O
N O w h n w O
M 6 w b w M M
to
p
M w h
Ot H w
H
of
ri 01
q
n h wry �t�nno m
M N M H
N
M
H
-
h y y
y
y
•w_4 •i r -t
y y I n'A y
1Mn imn
y
tN
N
K iHA
"N
w
to to w w n d
N
.+
w to ^
d
'o to b
w n
o
N to
to d o d N w b
w
vZ
M w W
d H o
w
H
et0i
OM0
T
y�
m H M N
N
M
N
.i tmn
vi y N y y
Lt.iMn
N N
in
of
d O
M
iD
moo.
O O M
M w
V
n
w N rl w w N h
M H w N o0 M M
M
1� tft O
M r -i
{/f
ei
F•:
} Di o r
N N
.w -i o
N
o
N
w ti v vi m o tr-:NNd
In mmry
t4
of m tri
y.
ri
L}
N
y
y
k4
H
y
rpt
y y
M
J.
try w H
O N O
d N
M M
N
07
d
O l0 r
O QI w H Vf H O
N n M N M
d�yy
w
w
ai N w
o0 H O
N
w
� ttH�n
y y
N y
N
y y y y y
N
N y
R.t
cd'
w N w
w d
H
O N {{ O N O w
N h lD w H N N
w
h
w H n
or 10
w
m
o:
N w O b
.m .-I
fY N
yy
M N
N q
th H
y
fV
IV
w
O d m Df 00 or d
N (� �! M of ri
H m r-'� H y N y
M
w
H
O O
M M M
K in
O
M'
.
N
N
yy yy y
N
N 44
s'
N'
�.
M o0 w M
O M
0 n
O H
N
N O H N 7 t{ to
d d H t� N V1
00
Ol
O
Oj w ID
n
w
m
N M m
% H N N
H r;
lwD OH
of
m
H
H N w m pwp�� m
M H H
r�
h
R O O
Qd
O
N
y y
y N
l
iMA N lnA
y y y to N
y
tr1llf
N H
iN
y
N 00 Ol w
O w m
A w O O
d O
rt M
n Qi
O
b
n
Vl N O M h O N
b �n w M M w
w �
N
M
N O n
M M lD
M
w
00 w h M N
b
H O O
oI
. x
VN N
/wit N
N L4 N 4H4 to tyV y
y
N
N N
-
N w O O
O w10
w O
w
w
O M O O O O O
0 MM O N O ��{{ H
M
m
to O n
w O w
M
w
H N
m
H
V n O M h O N
H H e -I H y N
w
of
b O O
ei Di If{
y m
o
is
y
N y
N y y y y
y
t~if
z ae
X
:� w aO
t�
r
$ 0
�N c
LL
,�1
>_
o
0v� C EO Z.,;
a Y b
ft' N
N
E K
N
W
.rd. w a
O
4 N
/6
tY ~
>
C
t9
w
to
INVIS A-ANALY7IC&COM
Page 51
105 WASHINGTON AVE INVESTMENT' ANAI.YSIS
Page 52
CO 00 0
lb0
tD b
0 N H Nv1 M W h ta0
l/ H H l0 n
.-i
toPt O O O Ol
N
V7 b M O N
M N
N N'
N N
N N VM1 N Na Vf
NhN tm/T
H H
�t�ii
N
V7
N
N N H
r.I
'v:'y
0 co O
N O (` V1
O h
O1
M Ol d O h H
M N t0 N l0 00
U1 pp H h O
O1 M 00 l0 H
V'
d M N
�+l
N
v1 H
M .�-ji O e1/-�1 w h a0
V u1 V N
N m N O d
LD P M v1 to
H
v}
tO m
�-I �-i
N N IA N
Z
_ �.
M o0v1 O
O o0 N
A
M h
O1 N
H
b pi oo d (� h b h
tO M N of N O a� O
H
v1 H O1 h N
d ry V t0 M
„il
o0 l!t
M
N Q1 T I O C' 00
Oa a N V N n
O ry [Y O O
of N M ll7 M
N tmi}
N N
N H tMAH NNNN
H V1 to
b co h o
V1 tp
h N O b h h Vf O
b O b h M
n N O
to V1
N N
O vi 41 b b b t'1+
f*Z h h c1 to m n
m 1011 N O n
yjA
-
b H
m m
h O
1D H
b Ou M N v1 M ti h
y� H M H H V)
ff)' M N M N
N N
y aA
M N
N N N vl to to
1V
N N N
h o ttM} VO1
L
Q
thll 1p0 tNA 1» . 1- N N IA
00 1b1�� W w n
b M
u
H h
M u2 d h d 01 00 t0
N t� .-� O d
N K
N
00 m N to M O' f^
NN HNN
N O1�f M om�f1 td"
N
N
t~n
V?
N VT
to
t.4 ei ei
H N to
^.
1D o0 h O
V1 p
to N dN N H m H o0
{Ibj H b N obo INfI
m h M
M O In O N
'
a O
}
c O
w OM�11 ll] M O h
�
44
ri t\ ffl If] ti
N
vmf
H H
L4 �v/
H
t`in114
pN.
LA co H O
N
M N
M
H O b h 0 0 lT1 M
O N H
m w N h Q
h
m
m lb M O
N h d H M N vl
b H N w h
b O H O
N N
O
V1 H
i 00' N' N leiM
H M H H QN M N
O fr1 t n
N 4 M H
Vl
is
LLl
O
O d
tiA O N O 0 N N N
lmO
1.,
0 i1 n
g;
is co O
m
N O dh M 00 dl d
h 10
(n Na O 1/1
y N
G
�~IT +n
N
.(
M o0 w O
O 'ct H
'7 h
v1 H
h N O H N d d v1
M V vl V
o0 p 00
O
C,
(Y tll
1 H
OHO n TND M
tO o0 .i [rYt
n W O N
co N
Vp
b
M vmf I�
NycH/S
f` o] I+i vj rn
toN
.ht .-t .di
Vf in Vf VT
N y
H
r
N UO 41 O
h O
(� v1 N O LA h O N
H b O h H
O t0 1n
w O
h m
t0 Q�
N b M N t0 M M W
1 b o0 H t0 n M N
M O1 M to O
b O O O O
-
00
}
N Ol
N h !t N j' M tT h
y
cD b M V1 N
Nv>
y
HHHvi� to
NN `^
H tHis
oo O O
ao O
o0 O m 0 0 0 0 0
M N O h M
0 0 N
O m
h Ol M O N O V H
QI 00 O b 07
tp 01 O O O
H N
H
N H H H N VY N N
Q1 M ul M N
a
N
E
a
E
_
r,cc
chi
a C
o
a ay a u7 i no ffi
N N
a a cc v
-
m ixN
LL
N
i s
r1 aN V h m
R
q
O of ry
G K l7 F-
i
Q CL S (y Q
o d A W d
taY3
2 U � 2
105 WASHINGTON AVE INVESTMENT' ANAI.YSIS
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 NOI 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 atter 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.
_.-.>.. ng
::.,::..;- v.�......•:,.,..:.-.,.::.J...,.,....y..... .!..:::............ .a:l"J' i.:,cr.-.,r•::t...;: �rizna.sv..vvl:ja::a:::,n._, .l:;.ii::-th...ay
Wlth TIF
Without TIF
Net Cash Flow Reversion
Total
Net Cash Flow Reversion
Total
Initial Cash Outlay
-1,033,788
-1,033,788
-1,033,788
-1,033,788
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 4
5,098
5,098
-16,579
-16,579
Year 5
4,627
4,627
-17,374
.17,374
Year
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 NO)
164,670
140,651
Terminal Cap Rate
8.00%
8.00%
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 INVISTA-ANALYTICS.CUM
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, 241 6.
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 lnvista Analytics.
Finally, IA 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,
Timothy Hess, PhD
INVISTA
ANALYTICS
146 Algoma Blvd - Suite H
Oshkosh, W154901
920.203.2177
www,invista-a nalyfes.com
Page 54
105 WASHINNGTON AVE INVES`l'MEN'r ANALYSIS
+A-NACYTIQj.
I I�TJ�►
Page 55
1E
M
PLAN CONDESSION MINUTES
August 2, 2016
PRESENT: David Borsuk, Ed Bowen, Jeffrey Thoms, John Mra, Steve Cummings, Donna
Lohry, Robert Vajgrt, Karl Nollenberger
EXCUSED: Thomas Pojtik, Kathleen Propp
STAFF: Darryn Burtch, 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 Poland,
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, 20.16 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 1.05 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 16t 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'presentedthe 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 within the district boundaries and discussed the area of the parking 16t 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 TY project, He also discussed project cost
expenditures which would be an estimate of $530,000 for development incentives for the life of the
TIF and $88,000 for the parking lot reconstruction. He also explained that the reason for the TIF
assistance requestwas to increase the internal rate of return (IRR) 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 TID 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 housebolds 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 iii this area, the TID boundaries and photos of the subject site.
Mr. Thoms questioned if this area was considered to be blighted.
Mr, Buxich 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. Thoms then questioned if the axea within the TO was all zoned C-3 Central Commercial
District.
Mr, Burich responded affirmatively.
Mr. Thorns 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.
Mr. Thoms inquired about the negative ERR that would result even after the TIP assistance and
why the development incentive was not higher to at least increase the IltR 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 IRR figure with this project.
I& Thorns 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.
I& 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 TIP at all.
Plan Comuussion 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
ining public stalls would be adequate fox 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..
Mr. Burtch 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 fox 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 district.
Mr. Bunch replied that this property was included in the district to balance out the TIF 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 corner 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. Burich 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 thehigh 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 if 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 worldng 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.
II. EXTRATERRITORIAL TWO -LOT LAND DIVISION/CERTIFIED SURVEY MAP AT 940
OLD KNAPP ROAD IN THE TOWN OF NEKTMI
The owner/petitioner is requesting a two -lot land division/certified survey map from one e)dsting
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 e)dsting 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. Thoms inquired if there were wetlands present on the site.
I& 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.
Plan Commission Minutes
Page 59
August 2, 2016
RESOLUTION NO. 16--02
RESOLUTION DESIGNATING PROPOSED BOUNDARIES
AND APPROVING A PROJECT PLAN
FOR TAX INCREMENTAL DISTRICT NO. 30i
CITY OF OSHKOSH, WISCONSIN
WIMREAS, 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;
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;
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)(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 Law; and
iVBEREAS, 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:
1. 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 ofthe District promotes orderly development in the City.
City of Oshkosh Wisconsin TID No. 30 Plan Commission Resolution
Page 60
Adopted this I (,th day Of A,ig„Gt , 2016.
LK V-WVI-
Plan dbission Chair
_b &v f 0 -1 i34 R3-','-1
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
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)1.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;
Page 62
AUGUST 23, 2016 16-442 RESOLUTION
CONTD
R. 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
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; and -
WHEREAS, after 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 Common 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 JRB'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 Cornmission 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, TID 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 M&(-, 2016.
Joint Review Board
Representing
Winnebago County
Oshkosh .Area School District
Fox Valley Technical College District
City of Oshkosh
/l/ G%zti
Public Member
City of Oshkosh of Wisconsin, TID No. 30 joint Review Board Resolution
Page 66
EXHIBIT C
Estimate of Property Project Costs
June 21, 2017
Tax Incremental Financing
Policy
and Application
Sources an4 Uses :of Funds
of total p ect.e&ts
Identify ffunds
.pso.use
*- i �
mezzanine financing, government. financing, -other anticipated types 6 fpjablC.assistance a6d--aftvotlierwes•
�
of methods of A �i . ianc . Ingi
Developer Equity:
M68 of ]p u-. illig
-Amount"
$ per SF.0filuiWing Area
iA
Land Ac Wiqoo-..
q
19:1
$T. 37
'.1
Dem` o1jt16n-*.,.
I.0$,ZOo
0;' SF
environmental Remedlati.w.
X31;000:
$.!,Q7 I.SF
Site -Cl *�aiidPrepar4tibn:
$10) Sr
-Soft Obswpd�s:
$591,557
y20E33ISF
Soft Coit CoAtingency-•1
$0,=
$1.371 -SF
Harii C. bns.tft.i.di.oh Costs:
TIF Asslstanc* e*
$98.164- SF
T6,td Project Costs:.
,$3j889a091
5 /'SF
Sources of Funds
of total p ect.e&ts
Equity
Developer Equity:
.26.6,-
%
y.; HTC' Equity investor
Othet tq4it-
$ 742,$.45
19:1
ojQ
T6tal Equity:
,Loan$
Rate Terin
$
%Q trios.
Permanent Financing:
2,925,000
4.5 25-
TIF Asslstanc* e*
$4 71
iYO,
dftylot ReconcillfAbn
-61A-8
22
'Total SoU- *rC t S. - of Funds
Financing
'SourceAmount. Terms: lkegsftnter.os.t. Contact tAformation
Equity:.
Discovery Pipp elles Cash -mgoudreafi@discovefy-propertiet..com
-
Loans j::Gho1ji,-e: Bank 25 yearst:(0,14,5C/10
0
lax Incremental Financing -
Polio and Application
F6r'.M' 'a" (in usfcorrespandf.o zine Iletns fqr Flses ofPunds on previous
Land Acquisition
Dentolition
.Site Clearance.;.and.'P'rc_para.i,ion
lnfiAstriucture:
IItilitiesfremoval
&bj600;
Lltlitiesfinstallatiori
$ -
Hazardous,-M;at.er'ials.Renioval
$$t-goq
Other(-)
Total Site Clearance and Preparation
$388,599
Soft Costs/Fees
Ar-;hitec(/Ehgijie , er
Developer Fee (
Appraisal
-4j8QO
801I.T.esting.
:$
Maiket. Study
4,000
uobO.
Insurance
Title/Recording/Transfer
:5.060
Building Perii*
Mortgage'Fee.s;
41.0-00
Construction Interest
$`
Gomruissions
.Marketing
Real. -Estate Taxes:
Other nxes
:Miler Hlstoric.TaX: Credit Consultants
Sub=W-tal S-ok-Ops.ts/Fegst
Soft Cost Contingency
Schedule 1
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, 2018
Available Tax Increment for 2017
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
2
June 21, 2017
November 1, 2036
Available Tax Increment for 2035
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
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.
3
May 4, 2017
EXHIBIT E
Projected District Revenue and Expenses
See attached
June 21, 2017
Y0
N
oN
O
Awl
c C
O
U
0
M
tD n 0 m O
H N m a m
tD n 0 m o
H N m a to
tD n 0 m 0
H
`t^t
m
`�
m
0)
H H H H N
0 0 0 0 0
N N N N N
0 0 0 0 0
N N N N m
0 0 0 0 0
m m m m m
0 0 0 0 0
m m m m a
0 0 0 0 0
a
0
4r.
to
a +°
O O O
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
Mt
N N F-
mtD 00 tD ID
a to a c0 H
m n 0 N 0
It It H H n
It 0
U C
Ma 00 a m
to tD O m a
N m m N H
m 0 tD O N
m 0 n It m
H m to m o
m a N wLn
o n N a a
O
N
U '3
c H ri m m
Ln H tD N ri
N tD .i m o
V n ti V r-
C C
N N
m O m m 0
H
00 00 n n l0
to to to a a
M N N H
> H
Q �
0
00000000000000000000000000
h a
U
m D
N D
m
m to
u'
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
o,cstn
m
n c1Ov
n
N m
r
m m
Q
to
o0 m m 0
a M m n m
M m m n m
M M o m N
m H n n N
N w o
H
0)
j
0 0 to m 0
O O m n H
00 tD a m N
It 0N tD O
N N N m a
a 0 N ll O
lD 0 H M n
a 0 M n H
O to m a 0
lD O It m a
0 N
0 m
O
m
♦+
w H N N m
M m V d' to
Lt Lr W to n
n N 00 00 m
m o 0 o ti
ci N
ri
rp
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
~ w
n
CL
w
m a
'
G C
A A
0 0 0 0 0
0 0 0 o o
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
0 0
0
> >
'O m
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
0 0
O
10
N
C
0 0 0 0 0
O rl '-I c-1 r1
0 C 0 0 0
e -i r-1 .i e-1 N
0 0 0 C 0
e -I rl .-1 c -I ci
0 0 C 0 0
ci c -I H e -I rl
C C C 0 C
r-1 r-1 ri r-1 �-1
C 0
ri e-1
O
tD
�'
U «
E
.o
H
M
°
Q
a
n v
`u
> a
o a
0 c
o
O
y
:= J O
bo
o�3
o
O
Du
0
Uy
000
000
v
n
v
>' a
c y
U O
o c
E-
p �U
H a n
H tD N m n
0 tD 7, m N
wH n N m
N 0
N
a j
y
C
m 00 n
m lD r
n w w to to
O m O H' N'
to to m m W
m a U1 lD n
tD n n 00 m
0 m O H N
0 0
a N
0
H
c c
A
y N
Ln u1 m
Ln ul tD tDtD
tD to to to to
tD l0 N n N
r
m
N
'>a
H
«
>,
a
CLw
u
> N
a H H
m m n 0 N
m m N 0 n
m a N m
n M n n N
N 0
m
�O
N N m
H m 0 n n
lD lD n n 0
m H m m n
m
O a m a 0
lD N
m
D
d 7
n O m
lD 0 H a n
o M ll m N
m m N m 0
N 0 a m a
0
'E
C N
tlj to tD
lD lD r, r: ri
0' 00 00 00 Ol
01 Ol o o o
H' 0' Ol D) o
o r4
o
m
,C U N
H H H
H H H H H
H H H H H
H H N N N
N N N N m
m m
N
m
C n
v
O
m .y
/
Oo m m 0
a to m n m
m m m n m
to v1 O m N
m H n n N
N tD to m
LD
N
H
U
O O to m 0
O O' M n H
0 to a m N
a O N 0 O
N N N m a
a O NR o
O 0 H m n0
a 0 M l- H
M m a 0
lc a O
O i a
N N m O
0 m n N
to
m
O
�p O
W HN' N m
m m V V u1
m m w tD r
n r 00 0 Dl
m o o O 'i
H N N m
m
u
• 0O v
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 m m
It
v
p y
W
0
O c
LC
O >
.f
A
E>
o o
o
«. c
m o
LL U
C 0
00 ri
o
Di
t c
v w
4)
m
m
>
C
>o
a 8
•
Q
L N
c
Ln m 0q
m m n m
to M m n m
m to O m N
m H n n N
N lD m m
tD
m y
�^
L
tD m 0
0 0 a m N
N N N m a
tD CO H In n
0 in m a c
lD N m Co
tD
m
m n H
0 N t0 O
It 0 N 0 O
a 0 M n H
tD O a m a
0 M n N
m
L
Ol
E
N N m
N N N
m m V d� to
NNN N N
m Ln tD tD n
N N N N N
n N W o m
N N N N N
m o 0 o .i
N M m m m
H N N m
m m m m
V
a
E
• t • H w
u
n
v_
c 3
c
• t
u
`e
N
lD n 00 m o
H H H H N
H N m a to
N N N N N
0 n 0 m O
N N N N m
H N M a M
M m m M m
l0 n 0 m O
m m m m a
H N M
a a a +
m
U
>}
0 0 0 0 0
N N N N N
0 0 0 0 0
N N N N N
0 0 0 0 0
N
0 0 0 0 010
N N
0 0 0 0
N
0 0 0 0 O
W
N N N N
N N N
N N N N
N N N N F-
D yy
Z W Q
Y0
N
oN
O
Awl
c C
O
U
0
M
EXHIBIT F
10 Year Internal Rate of Return (IRR)
May 4, 2017
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 NOI calculation, thereby inflating reversionary value and
IRR;
2) Value (with TIF included in NOI) and 10 year IRR (Year 11 NOI 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
1-800-552-1171 1 www.ehlers-inc.com
Ift EHLERS
LEADERS IN PUBLIC FINANCE
additional Developer cashflow, rather than included in the N01 calculation. Additionally, our
calculations included replacement reserves in the project operating expenses, which slightly reduced
N01. Per the City's TIF application procedures, Year 11 N01 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 $.93/SF. We did not confirm with outside brokers as to
rental rates in the downtown Oshkosh market given the time limitations of the engagement, however
based on our experience, and review against the competitive set, these rates appear to be reasonable.
CONCLUSION:
Based on our analysis and the exclusions noted above, the project returns a negative internal rate of
return, even with the TIF, City grant, and HTC participation. However, taking into account the project
location and finish level which may ultimately provide for increased rents in the future, we recommend
incorporating a "look back" provision in your consideration, pursuant to the City's policy.
Copies of our base analysis are included with this letter report. Please let me know if you need
additional background or information on this matter.
Respectfully,
Frank Roman
Municipal Advisor
Cc: M. Harrigan
T. Taves
1-800-552-1171 1 www,ehiers-inc.com
19 EHLERS
IEAOERS IN PUBLIC FINANCE
Developer Financing - Series A - Mortgage
Developer Financing - Series B
Developer Financing - Series C
DEVELOPER EQUITY
HTC EQUITY
Subtotal
Grants - City Parking Lal Reconstruction
Grants
Deferred Developer Fee
Fee Waiver
Other
0 < check
aG�cautgrrfoN<c�si's
Land.
,
geriNiliifon
5,51%
2,78%
10,720
5,410
En mediation
0,80%
1,550
Site GlearantxlF?taparation
0.77%
11500
closing Costs
0,00%
0
CGh7$TFtUCT10�(OS?8'
5,894�ib6
14.3095
t44,53$i.
Building/Land Improvements
73,90%
143,697
Tenant Improvements
0,00%
0
Permits
0,43%
841
SACMAC/Met C SAC/UAC
0,00%
0
Park Dedication
0
000%
0
General Requirements
0,00%
0
Contractors Fee
0.00%
0
Builder's Risk
0,00%
0
Contingency
0.00%
0
SOFT COSTS
PROFESSIONAL SERVICES'
229;60b.00
5.89'%1
11,480`,
Architectural, Engineering & Professional Fees
2,74%
5,335
Site
0;00%
0
Insurance
0,06%
125
Environmental
0,00%
0
Survey
0,00%
0
Historic Tax Credit Consultants
1.31%
2,550
Market Research
0.10%
200
Marketing
0,13%
250
Appraisals
0,12%
240
Cost Certification
0,00%
0
Legal/Accounting - Development
0,39%
750
Soft Cost Contingency
- ^,"
21,16%
2,000
FINANCINGCOSTS
:63 000 ?'
'F.62%
3,1b0
Construction Period Interest
1.44%
2,800
Issuance Fee
0.00%
0
Underwriter--�='"
_
0,00%
0
Bridge Loan
0,00°/
0
Title Insurance,{_
„ ,
0100%
0
Lender Legal
0.00%
0
Bond Counsel
''-
0,001/6
0
Trustee
0,00%
0
Mortgage Registration Tax
0.00%
0
Debt Service Reserve
000%
0
Financing Fee
��
0.05%
100
Escrows
Misc COI
f
0,00%
0
Title/Recording/Mortgage Registration Tax
0100%
0.13%
0
250
PERMANENT LOAN
=
0.00%
Or
ACCRt1E06 0,ENS1°S
0,00%
0
REAL STAT&TAXES
,W
0,28%
537.
PROJECT AAMAGEMENi
312,003 :
8,02%
1B,BOOi
Developer Fee
10.0 ' -
8,02
15,600
CASH=ACCOUNTS
4 -
0.00%0.
Inputted Expenses
0,00%
0
Working Cap
M
0.00%
0
Management Start up
0.00%
0
TOTAL USES
194,455
0 < check
Alk EHLERS
LEADERS IN PUBLIC FINANCE
City of Oshkosh WI
105 Washington Ave - With TIF
20 Apartment Units
Rent - Residential
1 bedroom
2 bedroom
3 bedroom
Total Apartment Rental Income
Other Residential Income
Garage 10 0$80, 100$150
Storage
Misc
Internet
Total Other Residential Income
Gross Revenue
Apartment Vacancy Loss (stabilized)
Residential Operating Costs
Administrative
Payroll
Marketing
Total Utilities
Insurance
Turnover
Total Maintenance
Total Residential Operating
Management and Other Costs
Management Fees
Property Taxes
Reserves
Total Expenses
$34,656$0.93
$151,704 $0.96
$24,648 $0.85
17,584 20 $211,008 18,740 $0.94
$27,600
$238,608
($11.930.40)'
6.41 % % of EG I
Unit
Unit
Unit
Unit
Unit
Unit
Unit
Operating Expense Ratio: 43.1%
$185
$361
$1,452
$600
$0
$875
$3.472
$726
$537
IL
U)
LLA
UJ.
6
O W O..N OO Or u o c6
M N W N M N 0 o '! m
N _ 00 NO r -a op W O No NN W NON ),ry •'
W 0 0 0 0 W r r N r N N M
tl co W d N CSO '}'- h (O v N tf'1 V' T V N O M CD cr Na h O H
a0 p N r r N N N N M
W
•Nt000OM
tO N_ M �SWOW WOOio
U2 LL'a
I
MOO 0al
LL
W . . N 0,Lo
tN to V
rah NN(NMC�
C9 r r r c0 '.N i Z Q
N � j
� Q
Lo o N N o t7 to O to m '" N co h IT W to m O (O M O O c1yy o In 0) co p1
CO O (o W OW1 to W W O N N N� r O W N d' h fD O O W c0 I
:�y W 0 0 0 0 W r r N N N N ttOD Sn N to
i' CM W W t� j cN� M X11; h c0 v N t[) V T d' I� O [� (D Ol In i1j iV O M CO m
NN to O M-- NNNN(O �V N NN 3
r r p
_MO O¢tOo Oto M N_ W htt 0 Lo 000000 W
00 rto c0 00 00co cNDNrrNWr-
00O CRO r
N W { r
VO' W 407N N N h cO vN Ld"i P, co t to r
Cl)
N N N _
Wm Z
Jr
mo rm OO(No N m N CON V't000N 00006 o i- a1 U
=W MO h0 CO i('C OWO OOOO(Np N.N---Nco 0) cn N � R 2
o m d 0 4
U J MCD W r0 vi _ h CD r N tfj V r .� .N- O M h v N O N 0
hct (O Cr�f Ov NNM c00 �UZOZ
r r N 0 0 0
O
:4-O 'fes N CSI LtiI hl.. •r- Oi
C sC CSi W co,-,OOOOtDrr r t` f MM
'ty, n ( rV N to t! r'•d- f+. 0 i5J 4= N: W W Ln
? ,7 N �.�� � 'C9 et �. N CV r � � ;� y. r N M �.✓�,.��4 w �' I� I� VN-„ N
r N
r
!!1dC N
O >
LQ C = z �0 t(N• Nv 00000 �N W pNNNNNW W 000000 e
Cn m C4
C }: Q rno(o n .w W 0000(C r. . IgUi
O O W 01 W v cor SIY h (D V N to st r a N W f0
,Q, (O to r N M r U) r 'tJ'
SiE T•• ,-= O W
y.04
V O N O O O m W O N N N N N� O O p 0 0 0 0
•S�, _
N00 O N N �y W O O O O CO r r M to F, N
O NCO CO NO C'J M '7; r" (d Cm co 7Tr C) NM
W c0 M y M M r
00N
0
U') C) Cl) NO:O t O m0N NNm00000000(n N
W mW O NNN p
W 0 0 0 0 10 r h W O
r W ONO W ~. I CO Cl)v N t(j tF r h = nj
to(O CR 4.. M `. r� OD
OZ.
O r �k
� v
�� N 0.0 NOco
N W N O N N N W 0 0 0 0 0 0 0 0 0^ r0
,� W OOOO(O co O
N h ;�Ny, hl0 vNto C'CD
M y W m=
M
co
ca
O
W
00
"o
000CM 00 N NCO c005`; RIy, C
. 16 �W M.-NM V co((ON HLU
Z
c a r
Na)
0 m a a n •
o Q a1 0) m
ca
(D 0 0 0 d W w
tpr O R 'C Q 4i U 0
cV�mmwE
_ N N N N N N N N N N M M �- v
m rz` d NN N N N N N N N N N N N N T p
N -
.• a•-0 (n (n (o (n
Oy to N !n N R
2.s s •C W N c 'W3' �. •C 4.
.bi