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HomeMy WebLinkAboutAgenda Report - February 4, 2009 K-01K Wo I CITY OF LODI REDEVELOPMENT AGENCY COUNCIL COMMUNICATION !M AGENDA TITLE: Review Economic©evelopment/Owner Participation Policies and Conceptual Three -Year Program Budget for the Lodi Community Improvement Project MEETING DATE: February4,2009 PREPARED BY: Executive Director RECOMMENDED ACTION: Review the recommended Economic Development/ Owner Participation Policies and conceptual three-year program budget for the Lodi Community Improvement Project. BACKGROUND INFORMATION: The Council has begun to consider implementation steps for the Lodi Community Improvement Project. In August, 2008, the Council adopted policies and procedures for a Residential Paint -up — Fix -up program. In September, 2008, at a Shirtsleeve Meeting, the Council was presented with policies for economic development and the Economic Development Owner Participation Program. As the initial presentation was at an informal Shirtsleeve meeting, now it is proposed that the Council review a conceptual three-year budget for the programs portion of the Lodi Community Improvement Project at a formal Council Meeting. The "Programs" referred to are all the Community Improvement Project activities excluding housing. In addition to the conceptual program budget, a presentation will be made with regard to the job creation/economic development/ owner participation policies proposed. The Council is encouraged to provide feedback. Depending upon the results of Measure "W', the first year's budget for the Lodi Improvement Project will be adopted for Fiscal Year 2009-10. Attached are proposed policies and tentative projections of tax increment for the next three years FISCAL IMPACT: The budget projections have been based upon a scenario of certain development occurring. It is unknown whether or not the development will occur. The proposed programs are self - funding, they should generate revenue to pay for their cost. The policies and programs expand the tax base which in turn creates more revenue to be reinvested in additional job creation and economic expansion. Estimated Revenue: FY 09-10: Housing Set Aside - $100,000 Programs - $300,000 FY 10-11: Housing Set Aside - $225,000 Programs - $700,000 FY 11-12: Housing Set Aside - $390,000 Programs - $1,213,000. � Blair King, Ex —irector . APPROVED: Blair ing, City Manager CITY OF LODI REDEVELOPMENT AGENCY POLICIES OWNER PARTICIPATION ASSISTANCE PURPOSE: Pursuant to the objectives of the Lodi Community Improvement Project, Owner Participation Agreements (OPAs) will provide financial assistance to rehabilitate structures, develop new facilities, encourage private investment, improve the tax base, promote commercial and ndwfiI development, and create employment. y" " USE OF FUNDS: Reimburse costs to rehabilitate listing anct oto new commercial, retail, or industrial property located w o ir4 6�boundarl'- tfie Lodi Community Improvement Project. In addition to const�tipn expenses, funds may be used to reimburse fees, permr pact mitigation mitigation fees, architectural and design fees, infrastructu st x �F df� site im merits, parking lots, equipment costs, fixtures and fur.014lings," improvements, and land acquisition costs. Priority will beivent pre#s requesting off-site x' °« .' ° x' , improvements owned by the city/ ency p ompl ro such as public parking _.tt, lots, sewer/water lines, electric rlities, sty t imp,etc. Note: some forms of assistance may trigger ate prevarf� w; requirements. ELI GIBILIT; mustft �� in increased assessed valuation. The site must be �r to the bourl p of t ; r� i Community Improvement Project. A finance jap must bed 'h, nstrate�i "that prevents a reasonable return on inve *t. Assistance mu e requested prior to the issuance of the Certificate of Oc oricy. The Agen `` Will not offer assistance to relocate automobile deal ershr big box ret yrs within the Lodi market area nor to develop automobiles rshipsbox retailers on any parcel five acres or larger that has not been vrogs developed for urban use. The Agency will not offer assistance for t�fr , construction, or improvement for gambling or gaming sites. FUNDING LIMITS: Funding shall be analyzed based upon the return to the city/agency in increased property value, taxes (including sales, transient occupancy, and business licenses), job creation, and the ability to eliminate crime, and stimulate other economic development activity. Funding limits shall be negotiated on a case-by-case basis contingent upon the benefits and financial return to the city/agency. APPLICATION PROCEDURE: Potential participants shall complete a project information summary that will include, but is not limited to, the following information: project description, estimated full value of property after improvements, total estimated payroll, total square footage created, estimated cost detail, and proposed financing. Staff will summarize the project information and seek the Agency's approval to enter into negotiations for the purpose of drafting an OPA (step one). If the Agency should grant its consent, an OPA will be negotiated (step two). The draft OPA will be presented to the Agency for approval or moc(gkcation (step three). RESTRICTIONS: Funds provided directly to an er/d t `�--6.4will be provided on a reimbursement basis only. Reimbursemen made n Certificate of Occupancy or other acceptable documentat�" �`, f� project ` mess. Assistance must be requested prior to thus ` . y of a tate of Occupancy. Owner must expressly agree to f iscrimination and nonsegregation that shall run with the land ` �> and to lease, sublease, use, enjoyment or occupancy. FEES: There is no applicatiori,g,f fc thwner rcipation Program. All other city permit and applicatio s apply; id February 4, 2009 Lodi Community Improvement Project Three-year budget projection FY 2009-2010: • Housing Set -Aside: $100,000 • Other Programs: $300,000 FY 2010-2011: • Housing Set -Aside: $225,000 • Other Programs: $700,000 FY 2011-2012: • Housing Set -Aside: $390,000 • Other Programs: $1,213,000 "Other Programs" budgets FY 2009-10 Jobs/OPA/Econ. Development: $300,000 • Promotion $ 30,000 • Owner Participation Agreement $270,000 Capital Projects Facilities Total $300,000 FY 2010-11 Jobs/OPA/Econ. Development: $330,000 • Promotion $30,000 • Owner Participation Agreement $300,000 Capital Projects: $150,000 • Water meter program? • Lodi Avenue? • Cherokee Lane rehabilitation? Facilities: $150,000 Administration: $ 70,000 Total $700,000 FY 2011-12 Jobs/OPA/Econ. Development: $561,000 • Promotion $ 30,000 • Owner Participation Agreements $531,000 Capital Projects: $291,000 • Water meter program? • Lodi Avenue? • Cherokee Lane rehabilitation? Facilities: $291,000 Administration: $ 70,000 Total $1,213,000 Housing Set -Aside budgets FY 2009-10 • Residential Paint -Up Fix -Up: $90,000 • Senior Housing: • Transitional Youth: • Infill First -Time Home Buyers: • Administration: $10,000 Total $100,000 FY 2010-11 • Residential Paint -Up Fix -Up: $ 90,000 • Senior Housing: $125,000 • Transitional Youth: • Infill First -Time Home Buyers: • Administration: $ 10,000 Total $225,000 FY 2011-12 • Residential Paint -Up Fix -Up: $90,000 • Senior Housing: $290,000 • Transitional Youth: • Infill First -Time Home Buyers: • Administration: $10,000 Total $390,000 Lodi Community Improvement Project Three-year budget projection FY 2009-2010: • Housing Set -Aside: $100,000 • Other Programs: $300,000 FY 2010-2011: • Housing Set -Aside: $225,000 • Other Programs: $700,000 FY 2011-2012: • Housing Set -Aside: $390,000 • Other Programs: $1,213,000 "Other Programs" budget FY 2009-10 Jobs/OPAIEcon. Development: $300,000 • Promotion • Owner Participation Agreement Capital Projects Facilities $ 30,000 $270,000 Total $300,000 "Other Programs" FY 2010-11 Jobs/OPA/Econ. Development: $330,000 • Promotion $30,000 • Owner Participation Agreement $300,000 Capital Projects: $150,000 • Water meter program? • Lodi Avenue? • Cherokee Lane rehabilitation? Facilities: $150,000 Administration: $ 70,000 Total $700,000 "Other Programs" FY 2011-12 Jobs/OPA/Econ. Development: • Promotion • Owner Participation Agreements Capital Projects: • Water meter program? • Lodi Avenue? • Cherokee Lane rehabilitation? Facilities: Administration: Total $561,000 $ 30,000 $531,000 $291,000 $291,000 $ 70,000 $1,213,000 Housing Set -Aside budget FY 2009-10 • Residential Paint -Up Fix -Up: $90,000 • Senior Housing: • Transitional Youth: • Infill First -Time Home Buyers: • Administration: $10,000 Total $100,000 Housing Set -Aside FY 2010-11 • Residential Paint -Up Fix -Up: $ 90,000 • Senior Housing: $125,000 • Transitional Youth: • Infill First -Time Home Buyers: • Administration: $ 10,000 Total $225,000 Housing Set -Aside FY 2011-12 • Residential Paint -Up Fix -Up: $90,000 • Senior Housing: $290,000 • Transitional Youth: • Infill First -Time Home Buyers: • Administration: $10,000 Total $390,000 Policy consideration No. 1 Should the City directly support economic development? Proposed policy: ? Provide direct financial assistance on a case-by-case basis. ? Have funds available for public improvements. Policy consideration No. 2 Should funds be advanced prior to construction or completion, or reimbursed upon project completion? Proposed policy: Reimbursed, except if the City is constructing publicly owned infrastructure in support of the development. Policy consideration No. 3 What can funds be used for? Proposed policy: ? Broad range of development costs, except financing. ? Priority for projects that result in the city/agency constructing publicly owned off-site improvements. ? Legal limitations on some businesses: Gambling, big box retailers and automobile dealerships relocated from other communities on previously undeveloped parcels of five acres or larger. Policy consideration No. 4 Should funds be available for financing? Proposed policy: Funds are available on a reimbursement basis for almost all development costs except financing. Policy consideration No. 5 ? Should the amount of funding be directly related to the amount of improvements? ? Should there be a hard cap on the amount of funding that any one project receives? Proposed policy: No funding limit. Negotiate funding on a case- by-case basis contingent upon the benefits and financial return to the City/agency. Policy consideration No. 6 Can assistance be requested after the project is completed? Proposed policy: Assistance must be requested prior to Certificate of Occupancy.