Item B: West Broadway Project - Laserfiche WebLink

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ATTACHMENT D Potential Funding Sources Urban Renewal Funding Sources The Downtown Urban Renewal District has been the primary source of funding for downtown revitalization projects, but the financial capacity of the district is limited by the “maximum indebt- edness” amount authorized in the plan. Current district capacity is approximately $7 million, made up of the following items: Potential Sources of Existing Urban Renewal Funds Amount Remaining Under Maximum Indebtedness Limit $4 million Downtown Revitalization Loan Program $2 million BEDI Grant @ 25% of Section 108 Loan $1 million Total Downtown Urban Renewal Funds $7 million Maximum Indebtedness Limit: With the defeat of Measure 20-134, the urban renewal district is limited in the amount it can spend on projects to approximately $4 million. The district currently receives about $1.8 million in tax increment funds annually. In order to receive tax increment funds to pay for projects beyond the $4 million of remaining unallocated spending capacity (as well as any interest on borrowing), the urban renewal plan would have to be amended to increase the spend- ing limit. Downtown Revitalization Loan Program: This loan program currently has a balance of about $2 million remaining for projects within the urban renewal district boundaries. These funds do not count against the $4 million “maximum indebtedness” spending limit. HUD Section 108 Loan/BEDI Grant: The BEDI grant must be used in connection with the Sec- The Section 108 Loan is NOT a source of funding on its own that can be added to tion 108 Loan. the $7 million total downtown urban renewal funds figure listed above. HUD has approved the City’s application for the Section 108 Loan based on urban renewal funds as the repayment source. The loan would be repaid from the $4 million of remaining tax increment funds and the $2 million DRLP funds. The current urban renewal funds are insufficient to secure the maximum amount of the Section 108 Loan ($7.895 million). In order to borrow $7.895 million from HUD, an additional source of repayment must be identified and approved by HUD. The BEDI grant is received in pro- portion to the amount borrowed under the Section 108 Loan. As an example, if $4 million of funds are available to secure a loan and $4 million is borrowed from HUD, then $1 million of BEDI grant funds would be available. Additional Potential Funding Sources For any project that exceeds $7 million (including the costs for administering the project by City staff and others), additional funding sources will need to be identified. The following is a prelim- inary list of some of those sources. General Fund Revenues: If the urban renewal spending limit remains at $33 million, then the dis- trict will not be able to continue to access tax increment funds once the spending limit is reached. The spending limit is currently projected to be reached during FY10. Under this scenario, the