Draft Business/Finance PlanOverview

&Draft Business Terms

RED LINE REGIONAL RAIL PROJECT

Economic Development Committee

January 10, 2012

POLICY FRAMEWORK

Economic Development Focus

Dual Benefit Strategy

Unified Benefits Approach

State Leadership

Presenters @ Public Policy Meeting(s)

Paul Morris, Deputy Secretary – NCDOTKatherine Henderson, KKH Consulting

Mark Briggs, Parsons Brinckerhoff

Economic Development Focus

Economic Development Focus

• Freight Oriented Development (FOD)

• Transit Oriented Development (TOD)

•Revenue-sharing across jurisdictions• 25% State• 25% CATS• 50% Local

• Tax Increment• Assessment District

•Governed by Joint Powers Authority (JPA)•State backing of the bond financing package

Dual Benefit Strategy

Unified Benefits Approach

State Leadership

RESOLUTIONREQUIRING A FISCAL IMPACT ANALYSIS

FORPUBLIC SUPPORTED ECONOMIC DEVELOPMENT PROJECTS

December 18, 2006

WHEREAS, . . .

NOW, THEREFORE BE IT RESOLVED by the Mecklenburg Board of County Commissioners, that a fiscal impact analysis be performed for all new economic development initiatives seeking Mecklenburg County’s partnership and financial support;

RESOLUTIONREQUIRING A FISCAL IMPACT ANALYSIS

FORPUBLIC SUPPORTED ECONOMIC DEVELOPMENT PROJECTS

December 18, 2006

WHEREAS, . . .

NOW, THEREFORE BE IT RESOLVED by the Mecklenburg Board of County Commissioners, that a fiscal impact analysis be performed for all new economic development initiatives seeking Mecklenburg County’s partnership and financial support;

Premise: Counties provide services to “Household”

Definition of HouseholdA household includes all the persons who occupy a housing unit. A housing unit is a house, an apartment, a mobile home, a group of rooms, or a single room that is occupied (or if vacant, is intended for occupancy) as separate living quarters. – U.S. Census Bureau

PROPOSED METHODOLOGY FOR FISCAL IMPACT ANALYSIS

Number of Households in Mecklenburg County 362,213

Total Property Taxes (FY-12) $880,397,487

Percent Residential 68%

Residential Property Taxes $598,670,291

Household Service Charge Analysis

Average Property Tax/Household $1,653

Residential Components(Expected at build-out)

Number of Households

Adjustment Factor

EquivalentHouseholds

Single Family 1,160 1.00 1,160

Condo/T.H./Seniors 3,890 0.26 1,011

Multifamily 6,431 0.34 2,187

Total HH & Equivalent HH 11,481 4,358

Total Service Costs > $18,978,000 per yr.Equiv. Service Costs > $ 7,204,000 per yr.

> Residential Tax Revenue needed: (# Households) * ($1,653 per Household)

TOTAL Benefits (using FY-12 tax rate)

Residential Tax Value (at build-out) $1,728,011,000

Commercial Tax Value (at build-out) $1,192,328,000

Total Annual Tax Revenue (at build-out) $23,847,500

TOTAL Benefits (using FY-12 tax rate)

Residential Tax Value (at build-out) $1,728,011,000

Commercial Tax Value (at build-out) $1,192,328,000

Total Annual Tax Revenue (at build-out) $23,847,500

Residential Tax Revenue Generated $14,111,000

Commercial Tax Revenue Needed $4,867,000

Total Service Revenue Needed, Annually $18,978,000

TOTAL Benefits (using FY-12 tax rate)

Residential Tax Value (at build-out) $1,728,011,000

Commercial Tax Value (at build-out) $1,192,328,000

Total Annual Tax Revenue (at build-out) $23,847,500

Residential Tax Revenue Generated $14,111,000

Commercial Tax Revenue Needed $4,867,000

Total Tax Revenue Needed, Annually $18,978,000

% Incremental Revenue Retained100% Residential50% Commercial

TOTAL Benefits (using FY-12 tax rate)

Residential Increment (at build-out) $1,728,011,000

Commercial Increment (at build-out) $1,192,328,000

Total Annual Tax Revenue Expected $23,847,500

TOTAL Benefits (using FY-12 tax rate)

Residential Increment (at build-out) $1,728,011,000

Commercial Increment (at build-out) $1,192,328,000

Total Annual Tax Revenue Expected $23,847,500

Equivalent Residential Tax Revenue Needed $7,204,000

25% Commercial Tax Revenue (per Plan) $2,434,000

Total Tax Revenue Retained, Annually $9,638,000

TOTAL Benefits (using FY-12 tax rate)

Residential Increment (at build-out) $1,728,011,000

Commercial Increment (at build-out) $1,192,328,000

Total Annual Tax Revenue Expected $23,847,500

Equivalent Residential Tax Revenue Needed $7,204,000

25% Commercial Tax Revenue (per Plan) $2,434,000

Total Tax Revenue Retained, Annually $9,638,000

% Incremental Revenue Needed 40%

Summary of Tax Increment Options

Percent Tax Revenue RetainedResidential , %

Commercial, %

Finance Plan Proposal

25% 25%

Equivalent HHs Analysis

40% 40%

Total HHs Analysis 100% 50%

Draft Business Terms

1. % Retainage2. Iredell County’s participation3. Bryton excluded4. No County financing risks5. O&M support6. Cost Overruns7. Allocation District boundaries8. Projects outside District boundaries9. Termination provisions10. JPA Formation, Composition, and Dissolution

NEXT STEPS

Public Policy Presentation (today)ED Committee Recommendations (by

3/13/12)Board Action (by 3/20/12)Final Draft Business/Finance Plan (by

3/31/12)