Council Packet 4-10-19 Work Session

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April 10, 2019, Work Session – Item 2 Improvement District. Staff will return to City Council/Agency Board with more details on Plaza design and cost once they are known. District Financial Capacity The Riverfront District spending limit (“maximum indebtedness”) is $34.8 million. “Maximum indebtedness” is a spending cap of tax increment revenue over the life of the district. The spending limit that currently remains uncommitted is estimated to be $12.3 million. However, current projections show that the District may not collect enough tax increment revenue through FY24 to realize the full amount of maximum indebtedness. It is estimated the District will collect enough tax increment revenue through FY24 to fund approximately $10.3 million of new expenditures on top of those that are already committed. In addition to tax increment revenue, the District also has program revenue, which are dollars from non-property tax sources, such as land sales and rental income. Program revenue is tracked separately from tax increment revenue because program revenue can be used for different purposes, such as providing funding for River Loans, and expenditures of program revenue are not included in maximum indebtedness. Current projections show that the District will collect enough program revenue through FY24 to fund approximately $7.8 million of new expenditures after setting aside $1 million for River Loans. Including both tax increment and program revenue, it is estimated the District will have approximately $18.1 million in total financial capacity to fund new expenditures through FY24. Please note the District does not currently have this amount on hand. Rather, this is an estimate of existing District resources plus projected revenue through FY24. Estimated Capacity Through FY24 Uncommitted tax increment revenue $10.3M Available program revenue $ 7.8M Capacity for additional expenditures $18.1M Immediate Projects for Consideration Park gap $ 5.0M Plaza initial request $ 4.0M Immediate Projects for consideration on 4/10 $ 9.0M Potential funds available for future projects* $ 9.1M *if the Agency Board approves the immediate projects Section 700 of the Riverfront Urban Renewal Plan requires that the Agency Board approve all projects, other than loans, in excess of $250,000. This is in addition to the Agency Board’s budget review and approval process. Riverfront Urban Renewal Advisory Committee The River Guides met on March 21 to discuss the proposed use of Urban Renewal funds to fill the $5 million gap for the Park and for the initial request of $4 million for the Plaza. The River Guides recommended support for the use of Urban Renewal funds in the amount of $5 million for the