granite ridge tif
DESCRIPTION
Tax Increment Financing Presentation from Rochester, NH - the Granite Ridge Development District takes off with a development plan for 915 acres and 2 million square feet of development. Call now for space!TRANSCRIPT
Granite Ridge Tax Increment Financing District
May 13, 2014City Council Meeting, Rochester New Hampshire
Presented by Karen Pollard, CEcD, EDP Economic Development Manager
Tax Increment Financing Legislation RSA 162-K
Local Option: Municipalities adopt provisions of RSA by the governing body
Create and adopt Development & Financing Plans to achieve community development goalsDefine the district, public facilities and infrastructure will be constructed, estimated budget and proposed operations within the districtThe plan can be amended as needed by the governing body, with required Public Notice & Hearings Multiple TIF Districts are allowed
Not to exceed 8% of assessed community value, or 16% for all districts with bonds outstanding Not to exceed 5% of total acreage, or 10% for all districts with bonds outstanding
Creating a TIF District
Increment accrues after date district is establishedUse of grant funds is allowed within TIF DistrictsBonds – First payment must be within 5 years and last payment no longer than 30 years. Bonds are NOT to be included when computing the municipality’s net debt under RSA 33Annual report will include financial reports for any development districtsAppointment of a TIF Advisory Board by the governing body is required.
RSA 162-K:14 “Members shall be owners or occupants of real property within or adjacent to the development district”
TIF: Hypothetical Example
Pre-construction or “original value” $100,000Post-construction or development $10,000,000
Value as assessed for Ad Velorum Taxes by City Assessor
Increment or “captured value” $9,900,000Property Tax calculation is “post construction” value at the city’s tax rate per thousand, currently $26.36 per Thousand = $263,600
Taxes received on the original value go to the general fund = $2,636 Taxes received on the increment are dedicated to costs as detailed in the Development & Financing Plan = $260,964
Property Taxes on $10,000,000= $263,600
($26.36/$1,000)
$2,636 to General Fund($100,000 @ $26.36/$1,000)
Pre-construction value $100,000
$260,964 Increment($9,900,000 @ $26.36/$1,000)
Increment $9,900,000
Post-construction value $10,000,000
Bond PaymentReimburse
ExpendituresMaintenance Administration
Reserves
TIF: New Hampshire Best Practices
Create your TIF District with a development project “in hand”Have written development agreements about scope of public improvementsHave a financial surety or developer guarantee as part of the development agreementCreate a reserve account for at least 1 year of debt service & operating costs“Background” market growth does get used towards increment, but don’t count on increases every yearWork in phases & expand the scope as development occurs
Granite Ridge Development District
Granite Ridge Timeline1988 Report by Applied Economic Research2000 Land Use & Transportation Master Plan2006 Economic Development Master Plan2006 Bruce Mayberry TIF Analysis - Feasibility2007 Buxton Retail Analysis – Regional Demand2008 CLD Engineering & Traffic Study – Land & Infrastructure Capacity2010 City Council endorsement of the Development District, new zoning adopted 2010 MOU with NH DOT regarding Granite Ridge District, DOT endorsement of CLD Study2013 DRED approves city’s application for New Hampshire Revitalization Zone status2014 Proposed creation of TIF District in conjunction with development to be initial “phase 1” catalyst project
Development Potential
Rochester is in need of amenities such as shopping, hospitality and service businesses to serve the residents & business in the city and in surrounding towns. Leakage of $308 millionCapacity & demand for 2 million sq ft mixed usesIncrease property taxes 581%Employment creation
Development Potential
Gross Land Area (Acres) 913.09
Building Floor Area (square feet)
Existing 594,316
Growth Potential 1,615,904
Buildout Total 2,210,220
Taxable Assessed Value
Existing 2013 $ 62,326,773.00
Growth Potential $ 362,419,005.00
Buildout Total $ 424,745,778.00
Annual Property Tax Yield
Existing 2013 $ 1,642,993.74
Growth Potential (Increment) $ 9,553,364.97
Buildout Total $ 11,196,298.71
Granite Ridge TIF District Map
Table 3: Granite Ridge TIF District Comparison Factor for Statutory Limitations
Comparison Factor for Statutory TIF Limitations Taxable Valuation Land Area in Acres
RSA 162-K:5 City Total 2013 $ 2,048,617,212.00 28,688.05
Maximum Allowable - Individual TIF District
(8% of City-wide Assessment; 5% of City-wide Acreage) $ 163,889,377.00 1,434.40
Granite Ridge Development District Valuation for Tax Purposes $ 62,326,773.00 913.09
As Percent of City Total 3.04% 3.18%
Maximum Cumulative TIFs Allowable $ 327,778,754.00 2,868.81
(16% of City-wide Assessment; 10% of City-wide Acreage) Granite Ridge Development District TIF $ 62,326,773.00 913.09Granite State Business Park RSA 162k:5 TIF $ 13,413,792.00 335.26Granite State Business Park RSA 205 TIF $ 24,169,200.00 56.45 Total Cumulative District Values 2013 $ 99,909,765.00 1304.80
As Percent of City Total 4.87% 4.55%
Why Now? “Catalyst” Project
Public Improvements
CLD Est. Public Improvements In 2008 $
Frontage Road & Interior Intersections $4,330,000
Access A & Farmington Road 1,010,000
Access B/ Nashoba Dr & Farmington Rd 1,530,000
Access C/ Crane Dr & Farmington Rd 1,900,000
Access D/ Little Falls Bridge & Farmington 1,770,000
Two Rod Rd & Farmington Rd 2,015,000
Access E & Farmington Rd 695,000
Access F & Farmington Rd 1,115,000
Water – Entire Project 2,900,000
Sewer – Entire Project 5,400,000
TOTAL $22,665,000
Public Improvements - 2014-2015 Anticipated
4. Severino Estimate - Access Roads to Boulevard & Intersection Little Falls Bridge Road
$ 814,675.00
5. Severino Estimate - Frontage Road (Granite Ridge Boulevard) and Wetland Basin
$ 1,500,440.25
6. Sewer & Water Improvements $ 1,000,000.00
Subtotal $ 3,315,115.25
Engineering 20% $ 663,023.05
Contingency 20% $ 795,627.66
Permitting & Mitigation $ 225,984.04
TOTAL $ 4,999,750.00
TIF District Creation Timeline
May 13 – Public PresentationMay 20 – Public Hearing & City Council Resolution and Reading for a 1st timeMay 27 – Modifications to the TIF Development & Financing Plan (if necessary) June 10 – Consideration for approval to create the TIF District (after mandatory 15 day period) Development Agreements will be considered individually by the City Council on a project-by-project basis
Questions?