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HomeMy WebLinkAboutCOUNCIL - COMPLETE AGENDA - 03/27/2013 - COMPLETE AGENDACITY COUNCIL AGENDA Karen Weitkunat, Mayor Council Chambers Kelly Ohlson, District 5, Mayor Pro Tem City Hall West Ben Manvel, District 1 300 LaPorte Avenue Lisa Poppaw, District 2 Fort Collins, Colorado Aislinn Kottwitz, District 3 Wade Troxell, District 4 Cablecast on City Cable Channel 14 Gerry Horak, District 6 on the Comcast cable system Darin Atteberry, City Manager Steve Roy, City Attorney Wanda Nelson, City Clerk The City of Fort Collins will make reasonable accommodations for access to City services, programs, and activities and will make special communication arrangements for persons with disabilities. Please call 221-6515 (TDD 224- 6001) for assistance. ADJOURNED MEETING Wednesday, March 27, 2013 6 p.m. 1. Call Meeting to Order. 2. Roll Call. 3. The meeting of March 26, 2013, was adjourned to this date and time to allow the Council to consider adjourning into Executive Session under Section 2-31(a)(2) of the City Code, for the purpose of discussing potential litigation and related legal matters. 4. Other Business. 5. Adjournment. u r b a n r e n e w a l a u t h o r i t y Karen Weitkunat, Chairperson City Council Chambers Kelly Ohlson, Vice-Chairperson City Hall West Ben Manvel 300 LaPorte Avenue Lisa Poppaw Fort Collins, Colorado Aislinn Kottwitz Wade Troxell Gerry Horak Cablecast on City Cable Channel 14 on the Comcast cable system Darin Atteberry, Executive Director Steve Roy, City Attorney Wanda Nelson, Secretary The City of Fort Collins will make reasonable accommodations for access to City services, programs, and activities and will make special communication arrangements for persons with disabilities. Please call 221-6515 (TDD 224-6001) for assistance. URBAN RENEWAL AUTHORITY BOARD OF COMMISSIONERS MEETING Wednesday, March 27, 2013 after the Adjourned Council Meeting 1. Call Meeting to Order. 2. Roll Call. 3. Agenda Review: • Executive Director’s Review of Agenda. 4. CITIZEN PARTICIPATION Individuals who wish to address the Board on items not specifically scheduled on the agenda must first be recognized by the Chairperson or Vice Chair. Before speaking, please sign in at the table in the back of the room. The timer will buzz once when there are 30 seconds left and the light will turn yellow. The timer will buzz again at the end of the speaker’s time. Each speaker is allowed 5 minutes. If there are more than 6 individuals who wish to speak, the Chairperson may reduce the time allowed for each individual. ! State your name and address for the record. ! Applause, outbursts or other demonstrations by the audience are not allowed ! Keep comments brief; if available, provide a written copy of statement to Secretary March 27, 2013 5. CITIZEN PARTICIPATION FOLLOW-UP This is an opportunity for the Chairperson and Commissioners to follow-up on issues raised during Citizen Participation. DISCUSSION ITEMS The method of debate for discussion items is as follows: ! Chairperson introduces the item number and subject; asks if formal presentation will be made by staff ! Staff presentation (optional) ! Chairperson requests citizen comment on the item (five-minute limit for each citizen) ! Board questions of staff on the item ! Board motion on the item ! Board discussion ! Final Board comments ! Board vote on the item Note: Time limits for individual agenda items may be revised, at the discretion of the Chairperson, to ensure all citizens have an opportunity to speak. Please sign in at the table in the back of the room. The timer will buzz when there are 30 seconds left and the light will turn yellow. It will buzz again at the end of the speaker’s time. 6. Consideration and Approval of the Minutes of the January 15 and February 28, 2013 Urban Renewal Authority Meeting. 7. Resolution No. 052 Approving a Redevelopment Agreement Between the Fort Collins Urban Renewal Authority and Breckenridge Group Fort Collins Colorado for the Aspen Heights Project. (staff: Bruce Hendee, Josh Birks, Megan Bolin; 15 minute staff presentation; 90 minute discussion) This Resolution would adopt a Redevelopment Agreement between Breckenridge Land Acquisition, LP (Developer) and the Fort Collins Urban Renewal Authority (URA) for Aspen Heights, a 220-unit student-oriented housing development in the North College Urban Renewal Plan area. The Developer requests $792,166 in tax increment financing to construct off-site street improvements. The total project cost is $46.5 million and is estimated to generate $174,641 in annual tax increment revenue. 8. Resolution No. 053 Adopting Revised Policies and Procedures for the Urban Renewal Authority. (staff: Tom Leeson, Bruce Hendee, Josh Birks; 10 minute staff presentation; 1 hour discussion) As a follow up to the February 28, 2013 URA Board work session, this Resolution amends the adopted 2012 URA Policies and Procedures. As an alternative to required participation in IDAP, the amended Policies require participation in the EPA’s Energy Star program and the Target Finder system to set energy targets for new buildings and major renovations. Additionally, in an effort to meet the City of Fort Collins established goal of diverting 50% of the community waste from landfills, the amended Policies also requires URA funded projects to demonstrate that at least 50% of the waste materials by weight (excluding waste containing lead, asbestos or other hazardous material) generated by a construction or demolition project be diverted from the landfill through waste management options, such as reuse or recycling. The Resolution also delegates the authority to March 27, 2013 approve Administrative Procedures with the Executive Director, and includes some minor language changes for clarification purposes. 9 Other Business. 10. Adjournment. DATE: March 27, 2013 STAFF: Wanda Nelson AGENDA ITEM SUMMARY URBAN RENEWAL AUTHORITY 6 SUBJECT Consideration and Approval of the Minutes of the January 15 and February 28, 2013 Urban Renewal Authority Meeting. January 15, 2013 Urban Renewal Authority A meeting of the Fort Collins Urban Renewal Authority was held on Tuesday, January 15, 2013, at 9:40 p.m. in the Council Chambers of the City of Fort Collins City Hall. Roll call was answered by the following Boardmembers: Horak, Kottwitz, Manvel, Ohlson, Poppaw, Troxell and Weitkunat. Staff Members Present: Atteberry, Nelson, Roy. Vice-President Ohlson withdrew Item No. 7, Resolution No. 049, Ratifying and Confirming the Redevelopment Agreement between the Fort Collins Urban Renewal Authority and RMI2 Properties, LLC, As Signed by the Executive Director on October 1, 2012, from the Consent Calendar. Citizen Participation Eric Sutherland, 3520 Golden Currant, discussed deficiencies in the 2013 URA budget. He stated it does not account for certain expenses which should be part of the budget. Consideration and Approval of the Minutes of the November 8 and November 20, 2012 Urban Renewal Authority Meetings, Approved Boardmember Manvel made a motion, seconded by Boardmember Poppaw, to adopt and approve all items not withdrawn from the Consent Calendar. Yeas: Weitkunat, Manvel, Kottwitz, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Resolution No. 049 Ratifying and Confirming the Redevelopment Agreement between the Fort Collins Urban Renewal Authority and RMI2 Properties, LLC, As Signed by the Executive Director on October 1, 2012, Adopted The following is staff’s memorandum for this item. “EXECUTIVE SUMMARY The Urban Renewal Authority (Authority) Board is being asked to ratify and confirm changes to the Redevelopment Agreement between the Authority and and RMI2 Properties, LLC, for the Rocky Mountain Innosphere project, as approved by the Executive Director and City Attorney and signed and executed on October 1, 2012. 182 January 15, 2013 BACKGROUND / DISCUSSION Background: The Authority Board adopted Resolution No. 020, approving a Redevelopment Agreement (the “Agreement”) between the Authority and RMI2 Properties, L.L.C. (“RMI2”) for the Rocky Mountain Innosphere (RMI) project on October 6, 2009, so as to authorize $2.8 million of tax increment financing (“TIF”) assistance for construction of a new business incubator facility. Although it was staff’s intent to finalize and sign the Agreement upon adoption of the Resolution, staff determined in early 2012 that no signed document could be located. In the course of preparing the Agreement document for signatures, staff identified provisions in the Agreement that did not accurately reflect the intent of the parties, were ambiguous, or did not address matters of implementation that would ultimately require clarification. Accordingly, staff prepared a modified version of the Redevelopment Agreement, reviewed it with RMI2, the Colorado Housing Finance Authority, and other stakeholders in the New Market Tax Credit Financing for the RMI project, and then proceeded to circulate the Agreement document for signing. The Agreement is dated “nunc pro tunc” October 7, 2009, meaning that it is understood and intended by the parties to be effective as of the date of October 7, 2009. See Exhibit A to the Resolution. Authority Resolution No. 020, authorized the Authority Executive Director to sign a Redevelopment Agreement “in substantially the form [of the Exhibit to the Resolution] . . . subject to minor modifications in form or substance consistent with this Resolution that the Executive Director, in consultation with legal counsel, may determine to be necessary in order to further the purposes of the Agreement.” See Attachment 1. The following summarizes key changes: • Revised the concept of “special fund” to instead use a “dedicated account” in order to avoid unintended accounting issues with the former; • Clarified that the “related documents” include the City to Authority loan documents so that funds received by the Authority from the owner can be used to pay debt service on the City’s loan to the Authority; • Modified references language to more clearly explain the relationship between the funds loaned and/or granted by the Authority and the costs of the improvements to be constructed by the owner; • Revised language regarding the payments to be made by the Authority to specify quarterly payments and to conform to the other changes noted above; • Added bookkeeping and inspection provisions to assist the Authority in enforcing the terms of the Agreement’ • Modified language regarding how funds will be received and managed; • Modified the way “pledged revenues” are described to be more consistent with the way the transaction was described and presented to the Board; and • Added language conditioning the credit of the “pledged revenues” of $2.8 million toward the owner’s obligations so that the credit only happens if the owner refinances its obligations to the Authority; this originally was described as part of the transaction but was not embodied in the Agreement document presented to the Board. 183 January 15, 2013 After review and discussion of whether the modifications that had been made to the Agreement fall within the scope of the authorization in Resolution 020 (quoted above), it was concluded that the agreement as modified could reasonably be interpreted to fall within the scope of the authorization. This was largely because many of the revisions serve to better describe the terms of the arrangements as they were envisioned to be implemented and as they were presented to the Authority Board. In addition, the changes are beneficial to the Authority and protect the interests of the Authority, and eliminate some agreement language that may have been difficult to implement or administer. The Agreement provides only for a credit of up to $2.8 million or such amount as represents the actual reimbursable project expenses (if less than $2.8 million) to RMI2 in the event that RMI2 refinances the obligations incurred in connection with the New Market Tax Credit Financing for the RMI project prior to March 31, 2017. The repayment obligation to the Authority under the New Market Tax Credit Financing is a promissory note payable at the end of the full term of twenty years. This twenty-year loan commitment was part of the structure of the New Market Tax Credit Financing authorized by the Authority Board on October 6, 2009, in Resolution No. 019. By requiring that RMI2 refinance the twenty-year loan after seven years in order to obtain the approved reimbursement from TIF revenues, the Agreement substantially increases the likelihood that the Authority will be repaid early or on better terms than had been previously made clear in the earlier version of the Agreement. The Agreement does include a specific reference, in Section 4.1, Authority Financing, as follows: The Authority will use its reasonable best efforts to cooperate with and assist Owner in Owner’s efforts to obtain financing sufficient to meet its obligations hereunder. In connection therewith, the Authority may advance funds in the amount of up to Five Million Three Hundred and Three Thousand, Nine Hundred and Thirty Nine Dollars ($5,303,939), in exchange for the commitments and undertakings of the Owner and entities affiliated with the Owner hereunder and pursuant to the Related Documents or such other agreements as may be approved by the Authority. (Emphasis added.) In the original form of the Agreement, as presented to the Board, Section 4.1 was more general, stating only that the Authority “will use its reasonable best efforts to obtain financing sufficient to meet its obligations under Related Documents.” However, the term “Related Documents” was defined to mean “those documents the Board of the Authority approved, by Resolution No. 020, on October 6, 2009, including, without limitation, a Loan Agreement, a Promissory Note, and a Pledge, Assignment and Security Agreement between the Authority and CGRF Investor Fund Five, LLC.” And, as with the revised Agreement, the amount of loan authorized in Resolution No. 019 on October 6, 2009, was Five Million Three Hundred and Three Thousand, Nine Hundred and Thirty Nine Dollars ($5,303,939). Consequently, the Agreement does not in any way increase the obligation of the Authority to RMI2, but rather limits and conditions the Authority’s obligations as they relate to reimbursement of RMI project costs from TIF revenues. 184 January 15, 2013 FINANCIAL / ECONOMIC IMPACTS The revised agreement does not change the contributions made by the Authority to the RMI project. Therefore, this resolution has no financial or economic impact on the City or Authority greater than the original agreement.” Josh Birks, Economic Health Director, reviewed the primary differences between the original and revised agreements, discussed the tax increment financing pledge, and described the twenty-year obligation between the Rocky Mountain Innosphere and the Urban Renewal Authority. Eric Sutherland, 3520 Golden Currant, opposed the financing and cost to taxpayers. He stated that the building was gifted to a private entity at the cost of taxpayers. Chairperson Weitkunat asked Mr. Sutherland to which building and entity he was referring. Mr. Sutherland replied the loan to RMI2 was set up in a manner such that payments are being made by the URA. He stated there was no down payment made by RMI2. Boardmember Horak asked Mr. Sutherland what his suggestion would be for a course of action. Mr. Sutherland replied Council should bring in an impartial negotiator with financial expertise. Vice-Chair Ohlson requested an explanation of the financial projection and reality variance. He asked if the $1.5 million would have been used to pay for other improvements in the URA if the projections had been correct. Birks replied there were three items that contributed to the variance, including the 2010 versus the 2012 timing, a change in the assumed rate, and, the most significant contributor to the variance, the change in approach of project valuations. The $1.5 million would have been available to the rest of the district to do other projects. Mike Beckstead, Chief Financial Officer, stated the URA is financially solvent and stated that there were several bits of misinformation in Mr. Sutherland’s statements. Boardmember Horak requested clarification about the timing of the full TIF payment being due to an oversight. Birks replied there was a hope the building would be completed earlier and the original preliminary estimate did not include the two-year delay. Boardmember Horak asked about the original valuation methodology and why it was selected over the DDA method. Birks replied there was consultation with the County; however, the County was not asked for an estimate. The original valuation methodology took into account project costs. Boardmember Manvel made a motion, seconded by Vice-President Ohlson, to adopt Resolution No. 049. Vice-Chair Ohlson asked if this agreement is, in any way, worse for the citizens and taxpayers of Fort Collins. Birks replied it is not, in his opinion. Beckstead replied this agreement is an improvement for the citizens of Fort Collins. The vote on the motion was as follows: Yeas: Weitkunat, Manvel, Kottwitz, Ohlson, Poppaw and Troxell. Nays: Horak. 185 January 15, 2013 THE MOTION CARRIED. Adjournment The meeting adjourned at 10:18 p.m. _________________________________ Chairperson ATTEST: _____________________________ Secretary 186 February 28, 2013 Urban Renewal Authority A meeting of the Fort Collins Urban Renewal Authority was held on Thursday, February 28, 2013, at 8:35 p.m. in the Council Chambers of the City of Fort Collins City Hall. Roll Call was answered by the following Boardmembers: Horak, Kottwitz, Manvel, Ohlson, Poppaw, Troxell, and Weitkunat. Staff Members Present: Atteberry, Nelson, Roy. Citizen Participation Eric Sutherland, 3520 Golden Currant, questioned whether governments should be able to take tax payer dollars and put them at risk. Resolution No. 051 Adopting a Revised Relocation Assistance and Land Acquisition Policy for the Fort Collins Urban Renewal Authority, Adopted The following is the staff memorandum for this item. “EXECUTIVE SUMMARY The URA adopted a Relocation Assistance and Land Acquisition Policy in October, 2012 that makes eligible for relocation assistance persons to whom the URA is not required to provide assistance under the URA statute. The amended policy limits the URA’s financial obligations to only those required under the URA statute by requiring financial assistance only where the URA uses eminent domain to acquire real property. The Resolution also authorizes the Executive Director to negotiate relocation assistance in connection with voluntary acquisitions by the URA. BACKGROUND / DISCUSSION The URA adopted a Relocation Assistance and Land Acquisition Policy in October, 2012, to govern activities when relocating individuals, families, businesses, non-profit organizations and personal property displaced by projects funded, in whole or in part, by the URA. The adopted Policy would limit eligibility for financial relocation assistance to persons who are required to relocate as a result of the acquisition of real property by the URA using eminent domain. Providing financial assistance for relocations beyond the minimum required in the statute could have significant financial ramifications for the URA and redevelopment projects eligible for URA assistance, and could substantially reduce the effectiveness of the URA in promoting eradication of blight and redevelopment of blighted areas. For example, persons who relocate when a redevelopment project moves forward would become eligible for assistance once that project receives URA financial support. 187 February 28, 2013 The URA is required to have a Relocation Policy in connection with the use of eminent domain to transfer acquired property to another private party. The amended policy limits the URA’s financial obligations under the Relocation Assistance and Land Acquisition Policy to the level required in the URA statute (Redlined version of policy included as Attachment 1). Additionally, there may be times the URA chooses to acquire property through a negotiated process without utilizing the power of eminent domain. These types of acquisitions may also result in the displacement of individuals, families, businesses, and/or non-profit organizations. The URA is not required to provide assistance by the State in these circumstances; however, the amended policy provides for possible negotiation of relocation assistance in these circumstances. The Resolution authorizes the URA Executive Director to negotiate terms of relocation assistance and financial support in connection with the negotiation of a voluntary acquisition of real property. FINANCIAL / ECONOMIC IMPACTS This proposal will decrease the potential economic impact to the URA. Limiting the relocation policy to provide financial relocation assistance only when the URA uses its power of eminent domain to transfer acquired property to another private party reduces the number of persons entitled to financial assistance; thereby, protecting the URA and those redeveloping with assistance from the URA from incurring uncontrollably high costs that are not directly associated with remediating blight.” Tom Leeson, Urban Renewal Authority Director, stated this Resolution is more consistent with the state statute and limits the relocation policy to only those cases where eminent domain is used. Boardmember Horak made a motion, seconded by Boardmember Troxell, to adopt Resolution No. 051. Yeas: Weitkunat, Manvel, Kottwitz, Ohlson, Poppaw, Horak and Troxell. Nays: none. THE MOTION CARRIED. Adjournment The meeting adjourned at 8:43 p.m. _________________________________ Chair ATTEST: _____________________________ Secretary 188 DATE: March 27, 2013 STAFF: Bruce Hendee, Josh Birks Megan Bolin AGENDA ITEM SUMMARY URBAN RENEWAL AUTHORITY 7 SUBJECT Resolution No. 052 Approving a Redevelopment Agreement Between the Fort Collins Urban Renewal Authority and Breckenridge Group Fort Collins Colorado for the Aspen Heights Project. EXECUTIVE SUMMARY This Resolution would adopt a Redevelopment Agreement between Breckenridge Land Acquisition, LP (Developer) and the Fort Collins Urban Renewal Authority (URA) for Aspen Heights, a 220-unit student-oriented housing development in the North College Urban Renewal Plan area. The Developer requests $792,166 in tax increment financing to construct off-site street improvements. The total project cost is $46.5 million and is estimated to generate $174,641 in annual tax increment revenue. BACKGROUND / DISCUSSION Aspen Heights is a new residential development proposed within the North College Urban Renewal Plan area. The Fort Collins Urban Renewal Authority (URA) received a formal application from Breckenridge Land Acquisition, LP (Developer) requesting a total of $1,329,576 in financial assistance (see URA Application, Attachment 1). This assistance would take two forms: $792,166 would be reimbursed using tax increment financing (TIF) for off-site public infrastructure; the remaining $537,410 would be in the form of a bridge loan to allow City Stormwater to reimburse the Developer for regional detention improvements in a timely manner. The URA has worked with the Developer since summer 2012 to refine the financial request with input from the North College Citizen Advisory Group (CAG), the URA Board Finance Committee, and other City departments. Project Description Aspen Heights is a 220-unit student-oriented rental housing project located to the east of North College Avenue, between Conifer Street and re-aligned Vine Drive. The site is approximately 31 acres and will include 62 duplexes, 76 multi-family units, and 82 single family homes for a total of 567 bedrooms available for individual leasing. The single family homes are proposed for conversion to extra occupancy rental houses after construction, increasing the total number of bedrooms to 712 (see Site Plan, Attachment 2). In addition to the on-site improvements, Aspen Heights will construct public street and stormwater infrastructure, including: • Northeast College Corridor Outfall (NECCO) - In 2010, the City purchased approximately 9.4 acres immediately adjacent to the Aspen Heights property to function as a regional detention pond for NECCO. If fully excavated, this site has the potential capacity of 40 acre feet of drainage. As part of the construction of the project, Aspen Heights will excavate 5.4 acre feet of the pond to serve its development. In addition to the excavation work, the project will install regional-sized stormwater pipes, including three inflow pipes and one outflow pipe, which provides important infrastructure for the broader NECCO project (see Stormwater Improvement Map, Attachment 3). • Re-aligned Vine Drive – this project will build a portion of re-aligned Vine Drive, a new east-west street that will ultimately connect North College Avenue to I-25. While a portion of the northern segment of re-aligned Vine Drive frontage abuts Aspen Heights’ property, the majority of frontage abuts the City-owned NECCO pond. To the south, re-aligned Vine Drive frontage abuts Old Town North, a partially-finished residential development, and the remaining portion abuts an undevelopable portion of Aspen Heights’ property (see Street Improvements Map, Attachment 4). A developer is typically required to pay for the local portion of the street that fronts his/her property; the developer of the other side of the road pays his/her portion as well, and street oversizing will pay the difference of bringing the road to its ultimate planned size. • Redwood Street – Redwood Street is currently a north-south road that ends at The Meadows at Redwood, a development immediately to the east of Aspen Heights, but then begins again to the south of Aspen Heights at Cajetan Street. This project will complete Redwood Street, providing a new alternative route from the north to Downtown, serving as a critical travel alternative to North College Avenue. March 27, 2013 -2- ITEM 7 • Dry Creek Conditional Letter of Map Revision (CLOMR/LOMR) – a portion of Redwood Street is within the Dry Creek floodplain, and this project will be required to obtain a CLOMR/LOMR from the Federal Emergency Management Agency (FEMA). Public Benefits Public benefit is measured by the extent to which the project aligns and achieves City policies and remediates blight. By adding housing and building regional public infrastructure in the North College area, Aspen Heights achieves a variety of City goals, explained in detail below. Aspen Heights supports a number of City Plan policies, including: • EH 4.1 – Prioritize Targeted Redevelopment and Infill. Create and utilize strategies and plans, as described in the Community and Neighborhood Livability chapter’s Infill and Redevelopment section, to support redevelopment areas and prevent areas from becoming blighted. The Targeted Infill and Redevelopment Areas shall be a priority for future development, capital investment, and public incentives. • LIV 5.1 – Encourage Targeted Redevelopment and Infill. Encourage redevelopment and infill in Activity Centers and Targeted Infill and Redevelopment Areas identified on the Targeted Infill and Redevelopment Areas Map. • LIV 7.7 – Accommodate the Student Population. Plan for and incorporate new housing for the student population on campuses and in areas near educational campuses and/or that are well-served by public transportation. • LIV 22.3 – Offer Multi-Family Variation. Offer variation among individual buildings within multi-building projects, yet stay within a coordinated overall “design theme.” Achieve variation among buildings through a combination of different footprints, façade treatment, roof forms, entrance features, and, in specialized cases, building orientation. Avoid monotonous complexes of identical buildings, although there may be ways to achieve visual interest among substantially identical buildings with a high degree of articulation on each building, combined with variation in massing on the site. • ENV 20.4 – Develop Public/Private Partnerships. Employ public/private partnerships to optimize the balance between stormwater management and compact development. Take advantage of opportunities to combine stormwater management needs from both public and private lands. The North College Infrastructure Funding Plan was created to prioritize key infrastructure in the area. The missing segment of Redwood Drive that Aspen Heights will build is listed as a high priority in the Plan. Furthermore, building the portion of re-aligned Vine Drive and installing the stormwater piping for NECCO, although considered to have lower priority, are identified as necessary infrastructure. All of these improvements were identified in the Plan as helping solve for adequate public facility issues and supporting economic development. Several blight factors as defined in Colorado Urban Renewal Law and cited in the North College Avenue Existing Conditions Study will be mitigated by this project, including: • Defective or inadequate street layout – Aspen Heights will add essential regional street infrastructure to remedy the lack of street connections in the area. The project will build the very first segment of the long- envisioned re-aligned Vine Drive, which will likely catalyze additional development within the area. • Deteriorated site or other public infrastructure – this area lacks an adequate, coordinated drainage system; Aspen Heights is making progress to correct this issue by installing drainage infrastructure that will provide a regional benefit to existing and future development in the North College area. • Inadequate public improvements or utilities – as mentioned in the previous two bullets, Aspen Heights will contribute to the creation of an adequate drainage system and functional street network. • Substantial physical underutilization or vacancy of sites – the fact that this site remains undeveloped in an otherwise urban area qualifies as helping to remediate this issue. Furthermore, several goals and policies articulated in the North College Corridor Plan are advanced by Aspen Heights: • Goal STN 1. Evolve a more complete pattern of streets, drives, and alleyways forming interconnected blocks of development, serviced by public access and utilities, behind highway (U.S. 287) frontage. • Policy LU 1.1 – Synergy. Zoning, City actions, URA, and business association efforts will assist “high multiplier” uses that bring people and economic activity, and add synergy with surrounding properties. Examples include 1) dwellings, 2) stable living-wage jobs, 3) retail sales and 4) attractions. March 27, 2013 -3- ITEM 7 • Policy FAD 2.1 – Seek Leverage Opportunities. Continuously seek and find ways to improve exceptional, image-changing locations by making transportation and drainage improvements; this sets the stage for additional development and public improvement projects to fill in gaps. Seek out transportation and drainage projects that combine multiple funding sources to create multi-functional benefits. TIF Reimbursement Tax Increment Generation The Larimer County Assessor’s Office (County) provided an estimate of future value, which was used to develop an estimate of potential tax increment generated by the project (see Attachment 1-G). Based on this analysis, the County estimates the stabilized value of the property to be $34 million at completion, generating $174,641 per year in tax increment. Assuming construction is completed in 2014, there is 15 years of annual increment potentially available to the project; conservatively estimating property values will not appreciate during that timeframe, the resulting total increment is $2,532,295. Eligible Costs The Developer requests $792,166 in tax increment financing (TIF) from the URA, which represents 30% of the total increment generated by the project. The Developer will receive interest on the eligible costs at a rate of 3.25% per year. This adds an additional $101,121 to the TIF reimbursement, bringing the total URA commitment to $894,287 or 35% of the total increment generated by the project. TIF will be used to reimburse eligible costs associated with public infrastructure improvements that benefit the entire North College region. Typically, when a new street is required to be built, a development is required to build the local portion of the street that directly abuts their property. If the land on the other side of the street has a different property owner, that owner is required to build the local portion of street that abuts his/her property. Normally, a full improvement includes the street, curb, gutter, landscaped parkway, and sidewalk. In cases where the City requires a higher level street classification, e.g., arterial, the Street Oversizing Program contributes the differential to build the street to its ultimate design. In Aspen Heights’ case, the Developer is building the entire street section for portions of re-aligned Vine Drive and the missing Redwood Street connection. It is important to note, however, that not all street segments will have full improvements. For example, the east side of Redwood Street will not have a landscaped parkway or sidewalk; only the street, curb and gutter will be constructed. Attachment 4 provides details of the level of improvements associated with each segment of Redwood and Vine. The development to the south of Aspen Heights, Old Town North, would be responsible for repaying the Developer for its portion of re-aligned Vine Drive. The property owners to the east of Aspen Heights would be responsible for repaying the Developer for their portions of Redwood Street. However, development of Old Town North has stalled and the properties to the east are undeveloped, making the timing of reimbursement to Aspen Heights uncertain. Additionally, significant portions of Redwood and Vine abut the City-owned NECCO pond, and the City does not typically reimburse a Developer for street improvements that abut its property. Since the timing of street improvement repayments from adjacent property owners is unknown and, in the case of the City property, repayment will not be made, the Developer requested the URA provide TIF to assist with these costs. The URA would then become the recipient of repayment obligations from adjacent property owners at such time when those properties develop. Table 1 below provides the cost allocation for the street improvements. March 27, 2013 -4- ITEM 7 Table 1: Cost Allocation for Street Improvements Off-site Street Improvements Redwood and Re-aligned Vine Drive (Physical street and utility improvements, street landscaping, Dry Creek CLOMR/LOMR) Developer $135,139 8.7% City (Street Oversizing) $643,959 41.3% URA TIF $778,666¹ 50% Total $1,557,764 100% ¹ Based on City Engineering estimates for street improvement costs, preliminary calculations estimate approximately $290,000 would ultimately be repaid to the URA for Redwood, and approximately $145,800 would be repaid to the URA for re-aligned Vine. In addition to the street improvements, the Developer requests TIF assistance to remove and replace trees that are in the pathway of re-aligned Vine Drive and Redwood Street. Attachment 5 is an illustration of the tree removal and other environmental mitigation. The allocation for this cost is shown in Table 2 below. Table 2: Cost Allocation for Tree Removal and Replacement Tree Removal and Replacement Tree Upsizing Associated with Redwood and Re-aligned Vine Drive Developer $1,500 10% City $0 0% URA TIF $13,500 90% Total $15,000 100% Reimbursement Structure In the past, the URA has provided developers a one-time reimbursement for eligible costs once the project is complete and invoices are received and approved. Since the URA does not have sufficient fund balance to pay these reimbursements outright, it has had to borrow money from the City of Fort Collins to fulfill its reimbursement obligations. In order to relieve the City from this role as lender, a different reimbursement structure is being proposed for Aspen Heights. Rather than receiving one lump-sum reimbursement, the Developer will receive annual reimbursement payments from the URA based upon actual tax increment revenue generated by the project. The reimbursement process will generally occur as follows: 1. The Developer completes all improvements and submits receipts to the URA for eligible costs as defined in the Redevelopment Agreement. 2. The Developer completes the project. 3. The Larimer County Assessor establishes a value for the property and completed improvements. 4. The URA collects tax increment revenue based on the Assessor’s valuation. a. 10% of the increment collected is retained by the URA. b. 90% of the increment is available to reimburse the Developer. 5. The Developer will receive an annual reimbursement for principal (verified eligible costs, up to $792,166) plus interest (3.25% per year) based upon an amortization schedule. It is anticipated the URA will be able to fulfill its obligation to the developer within 7 years. After the 8th year, the URA would retain 100% of the increment generated by the project. 6. If more or less increment is collected, the amortization schedule will be adjusted accordingly and would impact the actual financing cost. 7. The URA retains the ability to pre-pay the reimbursement obligation at any time, which would lower the financing cost. March 27, 2013 -5- ITEM 7 Benefits of this structure include: • A loan is not needed from the City for the URA to pay its reimbursement obligation. • Reduces risk to the URA and City because reimbursements are based upon actual tax increment revenue. • The URA retains 10% of the annual increment as soon as the project is completed until the reimbursement is fully paid (anticipated being 7 years)and retains 100% of the increment thereafter. Bridge Loan As mentioned previously, Aspen Heights will install three inflow pipes and one outflow pipe for the Northeast College Corridor Outfall (NECCO) project that will ultimately provide significant regional benefit. Earthwork and piping associated with this project has a total cost of $1,046,636. The City Stormwater Division (Stormwater) typically reimburses a Developer for the portion of these costs that are regional in nature; Aspen Heights’ reimbursement has been estimated at $537,410. Table 3 shows the allocation of cost. Table 3: Allocation of Cost for Stormwater Detention Improvements Stormwater Detention Improvements (NECCO piping and detention basin) Developer $509,226 48.6% City (Stormwater Utility) $537,410² 51.4% URA TIF $0 0% Total $1,046,636 100% ² If Stormwater has insufficient funds at the time Aspen Heights seeks reimbursement, the URA would provide a bridge loan to Stormwater to ensure a timely reimbursement. Stormwater’s process for reimbursement is based upon when a project executes a Development Agreement. Upon execution of the Development Agreement, the project becomes entitled to a reimbursement based upon the amount of funding Stormwater has available at that particular time. The reimbursement is on a first-come, first-served basis; if the available funding is committed to certain projects, subsequent projects must wait until the following year, or until such time as sufficient funding is available, to receive reimbursement. In Aspen Heights’ case, it seems likely that Stormwater will have sufficient funds to provide the project a timely reimbursement. However, if other projects needing reimbursement get their Development Agreements executed before Aspen Heights, it may take 1-3 years or longer before the Developer will be fully reimbursed. The uncertainty of when the Developer would be reimbursed by Stormwater and the regional nature of these improvements has led to the request that the URA provide a bridge loan so this project can be reimbursed upon completion of the improvements. The bridge loan would be available to the Developer only if Stormwater is unable to substantially reimburse the project within one year after the improvements are completed. If Stormwater is able to commit a portion of the reimbursement to Aspen Heights, e.g., 50%, the URA bridge loan would be reduced accordingly. Execution of the bridge loan, if needed, would require a separate action by Council and the URA Board, which will be coordinated after the Developer executes a Development Agreement. FINANCIAL / ECONOMIC IMPACTS Currently, the project site generates approximately $71,040 in annual property tax revenue. After the Developer’s $46.5 million investment, the site will generate approximately $174,641 in annual tax increment. Based upon a conservative estimate assuming no appreciation, the site will generate approximately $2.5 million over the remaining life of the North College Urban Renewal Plan area. The Developer’s request for $792,166 represents 30% of the total increment Although the URA will not have to borrow funds from the City to cover the reimbursement obligation, the Redevelopment Agreement commits the URA to repay the Developer principle and interest from the annual increment. Currently, the amortization schedule assumes an interest rate of 3.25%, which is likely lower than the actual interest rate the Developer will be paying on the construction loan. However, when taken into consideration, the total tax increment provided to Aspen Heights would be $894,287 ($792,166 principle + $101,121 interest), or 35% of the total increment. March 27, 2013 -6- ITEM 7 ENVIRONMENTAL IMPACTS Approximately 12,943 square feet of wetland area will be disturbed by Aspen Heights, primarily due to the Northeast College Corridor Outfall (NECCO) project. The Developer will replace this wetland area on-site for a new total of 14,810 square feet, or 15% larger than the original square footage. Although the Developer will only excavate a small portion of the NECCO pond for the project’s detention purposes, installation of the inflow and outfall pipes will make important progress towards the broader NECCO project. The NECCO project will provide a much-needed stormwater management system for the area east of College Avenue from Vine Drive north to the City Limits. Aspen Heights’ contribution will provide future development access to the regional detention pond. STAFF RECOMMENDATION Staff recommends adoption of the Resolution. BOARD / COMMISSION RECOMMENDATION The North College Citizen Advisory Group (CAG) met on November 1 and December 13, 2012 to consider the Developer’s request for TIF (meeting minutes provided in Attachment 6 and 7). At the December 13 meeting, the CAG voted unanimously to recommend funding. ATTACHMENTS 1. URA Application 2. Aspen Heights Site Plan 3. Stormwater Improvement Map 4. Off-Site Street Improvement Map 5. Tree Mitigation Map 6. November 1, 2012 CAG Meeting Notes 7. December 13, 2012 CAG Meeting Notes 8. Staff Presentation ATTACHMENT 1 ATTACHMENT 1, URBAN RENEWAL AUTHORITY APPLICATION TABLE OF CONTENTS A. URA APPLICATION FORM B. FINANCIAL REQUEST LETTER C. SUMMARY ALLOCATION OF OFF‐SITE IMPROVEMENT COSTS D. PHOTO OF EXISTING SITE E. NEIGHBORHOOD CHARACTER PHOTOS F. ELEVATIONS G. ESTIMATION OF LARIMER COUNTY FUTURE VALUATION H. ASPEN HEIGHTS COMPANY PROFILE Date modified 08/10 Tax Increment Financing (TIF) Assistance A P P L I C A T I ON _________________________________________________________________________________________________________________________________ PROJECT NAME: ASPEN HEIGHTS DATE: SEPTEMBER 17, 2012 REVISED DECEMBER 6, 2012 REVISED JANUARY 28, 2013 PROJECT ADDRESS / LOCATION: SW CORNER OF CONIFER AND REDWOOD APPLICANT / DEVELOPER / PROPERTY OWNER INFORMATION: APPLICANT DEVELOPER PROPERTY-OWNER Company Name BRECKENRIDGE LAND ACQUISITION, LP Breckenridge Group Fort Collins Colorado, LLC d/b/a Aspen Heights FIRSTBANK Company Owner/CEO GREG HENRY SAME Contact Person CHARLIE VATTEROTT SAME JEFF KING Title EVP DEVELOPMENT SAME Complete Address 1301 S. CAPITAL OF TX HWY BLDG B, SUITE 201 AUSTIN, TX 78746 SAME 1707 N. MAIN STREET LONGMONT, CO 80501 Phone 512-369-3030 X 330 SAME 303-684-6948 FAX 512-369-3454 SAME 303-684-6885 Email CVATTEROTT@MYASPENHEIGHTS.COM SAME JEFF.KING@EFIRSTBANK.COM TYPE OF LAND USE DEVELOPMENT / REDEVELOPMENT ACTIVITY X Residential Mixed-Use (Residential/Non-Residential) Commercial/Retail Mixed-Use (Commercial/Industrial) Industrial/Warehouse Other (please explain) PROJECT ELEMENTS X New Construction X Site Clearance X Infrastructure Improvement Building Rehabilitation X Land Acquisition Other (please explain) NEW OR EXISTING BUSINESSES (NON-RESIDENTIAL PROJECTS ONLY) New Business for URA Plan Area? Yes X No Existing Business in URA Plan Area? Yes X No Years in Business years FINANCIAL / FUNDING SUMMARY INFORMATION Total Project Cost $ 46,441,297 Current Actual Value (Larimer County Assessor) $ 2,698,540 Projected Actual Value $ 34,000,000 ATTACHMENT 1-A Date modified 08/10 (Larimer County Assessor) Projected Annual Property Tax $ 245,681 Total Property Tax Increment Expected $ 174,640/yr Total TIF Assistance Requested $ see attached TYPE OF TIF REQUESTED (include general terms & conditions) X Grant Loan (incl. methods of payback in description) SUMMARY OF FUNDING SOURCES AND USE OF FUNDS (for the entire project) Amount Source Use $ 792,166 URA Tax Increment Financing (TIF) Regional street improvements- see attached $ 537,410 URA/Stormwater Utility bridge loan NECCO pipes- see attached $ 643,959 Street Oversizing See attached $ 35,568,799 Loan- National financing institution $ 8,898,963 Equity-private individuals ddddddddd $ 46,441,297 Project Total INFORMATION REQUESTED FOR APPLICATION Please include: 1. A location map. See attached 2. Site plans or project drawings (please include photos of site currently). See attached site plan, a sample of the elevation drawings, picture of the existing site and pictures of housing projects completed by the company in other cities. 3. Project Proforma. Attached 4. Owner/Business resume. Attached 5. Executive Summary with the following questions answered: a. What is the nature of the project? Aspen Heights is a residential development consisting of 220 units on approximately 31 acres serving the student population and leased by the bedroom. The development includes 62 two-family units, 76 multi-family units and 82 single family homes for a total of 597 bedrooms available for individual leasing. The single family homes are proposed for conversion to extra occupancy rental houses after construction which will increase the total number of leasable bedrooms in the development to 712. b. Why is TIF assistance needed; how will the funds be used? The majority of the funding request is based on the impact on the property as a result of the city purchasing a portion of the property for a regional detention pond. This pond is a component of the Northeast College Corridor Outfall (NECCO) Drainage Improvement Project. The detention pond has significant frontage on New Vine Drive and along Redwood Street. However, the Stormwater Utility has indicated they are not able to pay for the cost of the roads bordering their property. Also, the location of the detention pond generated a 1.84 acre undevelopable piece of property. This sliver of land also has significant frontage along New Vine Drive and Redwood but no capacity to help with the funding of those improvements. In brief, the majority of off -site public improvements are not needed to serve the development. The improvements total over $2.5 million and are being required by the City as a condition of ATTACHMENT 1-A Date modified 08/10 development approval to support the regional detention and transportation needs of the area. c. What other sources of financing will the project secure other than TIF? Street Oversizing will reimburse some of the Vine Drive and Redwood Street improvements. Equity is being provided by private individuals. A loan will be secured from a national financial institution. d. How will the project help improve/upgrade public infrastructure (streets, utilities, drainage, etc.)? Redwood Street will be connected from existing Vine Drive to Conifer Street. Redwood also becomes Linden at Vine providing an alternate route to downtown to help minimize traffic on College Ave. The first section of New Vine Drive will be constructed. The first phase of the North East College Corridor Outfall (NECCO ) will be constructed consisting of 4 large pipes leading to the future regional pond. e. How will the project enhance the property tax base (and sales tax base, if applicable) of the area? The property is currently vacant land. Larimer County estimates the future tax value at $34 million generating an additional $174,640 (total of $245,681) in taxes per year upon completion. f. How will the project help achieve the goals of North College Urban Renewal Plan and City Plan? The project supports the City Plan policies and North College Infrastructure Funding Plan in the following areas: o City Plan policies:  EH 4.1 – Prioritize Targeted Redevelopment Areas  LIV 5.1 – Encourage Targeted Redevelopment and Infill  LIV 7.7 – Accommodate the Student Population  LIV 22.3 – Offer Multi-Family Variation  ENV 20.4 – Develop Public/Private Partnerships o North College Infrastructure Funding Plan:  #16 – Realigned Vine Dr – Blue Spruce to Redwood  #17 – Redwood St – missing southern segment Cajetan to Realigned Vine Dr  #18 – Redwood St – missing northern segment Realigned Vine to current terminus  #21 – NECCO – primary “backbone” section from Pond to Vine Drive  #22 – NECCO – redevelopment system (upstream of Pond) Note these are all Adequate Public Facility issues More detail can be found in the attached portion of the City of Fort Collins staff report dated August 7, 2012 for the Administrative Hearing listing the specific ways the Aspen Heights project supports the North College Corridor Sub-area Plan. The NECCO and transportation improvements will directly support both the URA Plan and City Plan. Residential and employment growth are necessary in urban renewal before retail/sales tax revenues can increase. Aspen Heights brings an immediate and large increase in residents and future shoppers (potentially a total of 712) to the area. Specifically, the project fulfills the vision of the North College Corridor Plan, an adopted element of City Plan, by being located within the Targeted Redevelopment Area and by adding housing units to the benefit of the trade area. In addition, the extensions of Redwood Street, Blue Spruce Drive and Lupine Drive as public streets contribute to a more complete street network, and the inclusion of housing along Conifer Street promotes the viability of its designation as an Enhanced Travel Corridor. Construction of the first phase of the NECCO also directly supports the Corridor Plan by installing major stormwater pipes that can be utilized by other properties in the tributary area (see attached Storm Drainage exhibit). ATTACHMENT 1-A Date modified 08/10 g. How will the project help eliminate slum and blight conditions? Improvements to public infrastructure are a critical element at the front end of urban renewal efforts. Aspen Heights will provide significant improvements to the stormwater and transportation systems serving the North College area and help spark economic development in an area of the City that has not kept pace with the City as a whole. Specifically the project will address the following: o Defective or inadequate street layout – the project will add connections to remedy this issue o Deteriorated site or other public infrastructure – the plan notes the lack of an adequate, coordinated drainage system, which this project will help to correct o Inadequate public improvements or utilities – the project contributes to the creation of an adequate drainage system and functional street network o Substantial physical underutilization or vacancy of sites – the fact that this site remains vacant in an otherwise urban area qualifies as helping to remediate this issue. h. How will this project help achieve the URA goals of sustainability through green building techniques? Please be specific how this project uses energy efficiency, renewable resources, natural resource conservation techniques, stormwater low impact design methods, or any other methods not listed. The project will comply with the recently adopted Green Building Code. Only 8,856 sf of wetland area will need to be disturbed. Because of the small size, city staff and the developer are discussing whether it is better to replace the wetland on site or enhance another city related wetland project. Much of the existing wetland is a narrow channel with limited wildlife habitat value. The configuration of the replacement wetland will be a significant improvement with desirable shrubs and grasses. The applicant is also proposing a dedication of the 1.84 acres of land south of New Vine Drive to the city or the Old Town North HOA to enhance the habitat and urban forest in the area. This vegetation will complement the plantings included in the detention pond. i. Please provide documentation and quantifiable results stating the proven methods or effectiveness of the proposed sustainable features within the project. N/A j. What is the proposed project timetable (what is the estimated time frame for major steps including the City’s planning decision, completion of financial commitments, start of construction, and issuance of Certificate of Occupancy (CO)? The Hearing Officer issued a decision approving the PDP on August 16, 2012. The decision has been appealed and will be heard by the City Council on October 30, 2012. Upon final PDP approval, the developer will proceed immediately with a FDP, final plat and development agreement. Private financing is being provided by a national financing institution and will be completed by spring of 2013. Construction is anticipated to begin immediately upon final approval and the provision of security. The first buildings are projected to be completed by late 2013 and all buildings by the summer of 2014. Following the construction of the single family homes and issuance of certificates of occupancy therefor, each will be eligible for conversion to an extra occupancy rental house with increased tenant capacity. Please provide any additional information that would be helpful to your application. -------------------------------------AREA BELOW FOR URA STAFF USE ONLY-------------------------------------------- Date Received Project Number Project Manager ATTACHMENT 1-A Aspen Heights URA Financial Request 09-14-2012 Revised 12-6-12 Revised 01-28-13 Breckenridge Land Acquisition, LP is the applicant for the proposed Aspen Heights residential development on 31 acres at the southwest corner of Conifer and Redwood Streets. The PDP includes a total of 220 dwelling units: 62 two-family units, 76 multi-family units and 82 single family homes for a total of 597 bedrooms available for individual leasing. The single family homes are proposed for conversion to extra occupancy rental houses after construction which will increase the total number of leasable bedrooms in the development to 712. Total floor area of the buildings is approximately 428,000 square feet (not including the clubhouse). A significant portion of the off- site public improvements are required to support regional transportation and stormwater improvements being requested by the City. The off -site street improvements and NECCO stormwater pipes also trigger tree removal and replacement and other environmental costs. Street oversizing is also a component of the required financing for the project to be viable. That cost is referenced in the attached drawings and summary tables along with the URA and stormwater reimbursement amounts. Two key factors help explain the regional nature of the improvements and the basis for URA support: many of the costs would not be needed “but for” the following: The location of the City’s regional detention pond which serves much of the Northeast College Corridor Outfall (NECCO) area ; and The city’s chosen alignment of New Vine Drive which creates a 1.84 acre remnant that is not economically viable to develop. The specific improvements for which URA support is being requested are listed below and are reflected on the enclosed drawings. 1. New Vine Drive- URA. The development could function with the existing access to Conifer and Redwood Streets. However, the City is also requiring this project to build the initial phase of New Vine Drive. Much of the New Vine Drive frontage being constructed by the project is adjacent to the regional detention pond site owned by the City or the uneconomic remainder of land. Another portion is adjacent to the Old Town North property which is in foreclosure and not likely to make a third party reimbursement for several years. The applicant is seeking URA support for those portions of New Vine Drive. The street improvements will also trigger tree removal, upsizing and replacement costs for trees, plus prairie dog removal and mitigation costs. 2. Redwood Street-URA. The development itself does not trigger the need for the extension of Redwood Street. A significant portion of Redwood Street is adjacent to the regional detention ATTACHMENT 1-B pond site. Another portion of Redwood Street is adjacent to the uneconomic remainder parcel. Thirdly, a portion of Redwood Street is being constructed to complete the connection to existing Redwood Street considerably south of the development. This completion of Redwood Street (which becomes Linden at existing Vine Drive) is an important expansion of the regional transportation system. It provides an alternate route to downtown and thus helps keep vehicles off College Avenue. The construction of Redwood Street also triggers tree removal, upsizing and replacement tree costs, plus prairie dog costs. The URA can seek third party reimbursement for a portion of the street improvements from adjacent properties when they develop. 3. Northeast College Corridor Outfall (NECCO) URA- Stormwater Bridge Loan. The City has purchased property to function as a regional detention pond which will eventually have a capacity of 40 acre feet. Aspen Heights will build the first phase of the pond creating approximately 5.4 acre feet of detention and a temporary outfall pipe. The outfall pipe being installed by Aspen Heights can be used for a future interim expansion of the pond prior to the major outfall pipe being installed. Much of the NECCO cost being incurred is for the installation of stormwater pipes (up to 66 inches in diameter) that are not be needed by Aspen Heights. The pipes are being installed at the time of the Aspen Heights development in order to minimize future costs to the City. The Stormwater Utility staff and the applicant’s engineer have developed a cost sharing allocation which is enclosed with this application. The NECCO improvements also trigger tree removal, upsizing and replacement tree costs, the installation of landscape plantings plus prairie dog removal and mitigation costs. The NECCO costs not needed for Aspen Heights should ultimately be borne by the Stormwater Utility and future development. However, the Utility cannot guarantee when Aspen Heights will be reimbursed. The applicant is suggesting the URA commit to provide interim funding of the NECCO related costs. This can be viewed as a bridge loan from the URA to the Stormwater Utility. The language in the URA Redevelopment Agreement would also acknowledge that the URA responsibility for the NECCO costs would be reduced or terminated when the Stormwater Utility reimburses Aspen Heights. It is not possible for the development to proceed without a clear understanding of the timing for reimbursement of the NECCO costs. The URA would eventually be reimbursed by the Utility. Summary. The applicant is requesting $792,166 in support from the URA for regional street improvements and an additional $537,410 of support in the event the Stormwater Utility is not able to reimbursement Aspen Heights for the NECCO improvements at the end of construction. The preliminary calculations by the County (see attached) shows the tax increment to be $174,640. Assuming 15 years of collection, the total Tax Increment would be approximately $2,619,600. The URA support for street improvements represents approximately 30% of the TI. The temporary funding for NECCO improvements represents approximately 20% of the TI but is expected to be much less if the Stormwater Utility can reimburse some or all of the amount at the end of construction. ATTACHMENT 1-B Developer Third Party Reimb. Street Oversizing Fund Urban Renewal Auth. Stormwater Utility Dept. Totals Road Improvements and Streetscape - Physical Street & Utility Improvements $121,501 $0 $514,611 $699,910 $0 $1,336,022 - Street Landscaping $13,638 $0 $129,348 $63,756 $0 $206,742 - Dry Creek CLOMR / LOMR $0 $0 $0 $15,000 $0 $15,000 $135,139 $0 $643,959 $778,666 $0 $1,557,764 Stormwater Management Improvements - NECCO Piping and Detention Basin $509,226 $0 $0 $0 $537,410 $1,046,636 $509,226 $0 $0 $0 $537,410 $1,046,636 Tree Removal and Replacement - Tree Removal $300 $0 $0 $8,100 $0 $8,400 - Replacement Tree Upsizing $1,200 $0 $0 $5,400 $0 $6,600 $1,500 $0 $0 $13,500 $0 $15,000 Environmental Mitigation - Prairie Dog Removal $15,827 $0 $0 $0 Included above $15,827 - Habitat Loss Compensation $28,110 $0 $0 $0 Included above $28,110 $43,936 $0 $0 $0 $0 $43,936 Totals $689,802 $0 $643,959 $792,166 $537,410 $2,663,337 Revisions from 12/06/12 Allocation Summary 1. "Local" portion of cost of sidewalk along south side of New Vine Drive, adjacent to Old Town North frontage, added to Urban Renewal Authority share of Road Improvement and Streetscape costs. 2. "Street Oversizing" portion of cost of sidewalk along south side of New Vine Drive, adjacent to Old Town North frontage, added to Street Oversizing Fund share of Road Improvement and Streetscape costs. 3. Costs of prairie dog removal and habitatloss compensation, within off-site street ROW, previously allocated to URA, transferred to Developer. ALLOCATION SUMMARY OF OFF-SITE IMPROVEMENTS COSTS AND ENVIRONMENTAL MITIGATION COSTS January 23, 2013 ASPEN HEIGHTS STUDENT HOUSING ATTACHMENT 1-C ATTACHMENT 1-C ATTACHMENT 1-D ATTACHMENT 1D Neighborhood Character Aspen Heights has the look and feel of a residential neighborhood. ATTACHMENT 1-E ATTACHMENT 1F ASPEN HEIGHTS TIF *2012/13 Mill levy subject to change, Approx values based on preliminary figures. 2013 TAX YEAR 2014 PAYABLE MILL LEVY* * EXISTING PARCELS 90.778 2011/12 value PORTIONS LAND SIZE LAND VALUE IMP VAL TTL IMP $/SF LAND VALUE 2014 ASSMT RATE 2011 taxes 2012 taxes EAST OF JAX SURPLUSVACANT LND 1,349,270 $2,698,540 $0 $2,698,540 $2.00 $8,770,255 29% $71,040.74 $71,040.74 * TIF: ESTIMATED VALUE: tax increment 2013/2014 PORTIONS LAND SIZE LAND VALUE IMP VAL $/SF LAND VALUE 2014 ASSMT RATE TAX GUESTIMATE DIFFERENCE ASPEN HGHTS multi family 1,349,270 $7,420,985 $26,579,015 $5.50 $34,000,000 7.96% $245,681.58 $174,640.84 $153,846 per unit ASSESSMENT RATE CHANGES FROM VACANT LAND TO RESIDENTIAL USE ATTACHMENT 1-G ATTACHMENT 1-G Company Profile Aspen Heights is a national full service real estate development and management company headquartered in Austin, Texas. Aspen Heights was founded in 2006 with the vision of revolutionizing student housing by creating an all-student neighborhood of craftsman style homes with the convenience and amenities of a luxury apartment complex. With a staff of over one hundred twenty employees, Aspen Heights is active in over a dozen markets across the country. Product Overview Aspen Heights’ product consists of four and five bedroom craftsman style cottages, two and three bedroom duplexes, and three to six unit townhome buildings. The product far exceeds the prevailing standard in the student housing industry in attention to detail, luxury finishes, and bedroom size. All bedrooms come with walk-in closets, attached bathrooms, and individual leases. Aspen Heights is constantly in the process of designing new concepts to diversify its offerings and improve the student living experience. Current and Past Projects Since 2008, Aspen Heights has financed fifteen projects totaling over $430 million in cost. This has been possible by raising of over $100 million in equity funding, an ongoing process that continues to fuel future growth. As shown below, Aspen Heights has ten projects currently under construction or development, four of which will deliver in the Summer of 2012. The remaining projects are slated to deliver in the Summer of 2013. All projects have been 100% preleased upon delivery. Year Market Entered Project Size 2007/2008 Baylor University 475 beds 2009 Texas A&M University 476 beds 2010 UT – San Antonio 288 beds 2011 Louisiana State University 308 beds Texas State University 608 beds 2012 UT – San Antonio Phase 2 844 beds Texas State University Phase 2 508 beds University of Georgia 372 beds Auburn University 600 beds 2013 Middle Tennessee State 750 beds Georgia Southern University 1,087 beds Clemson University 598 beds University of Missouri 972 beds James Madison University 600 beds Oklahoma State University 756 beds 9,242 beds ATTACHMENT 1-H CONIFER STREET “NEW VINE” DRIVE SITE PLAN ASPEN HEIGHTS EVERGREEN PARK UNDEVELOPED REMNANT PARCEL REGIONAL DETENTION POND AREA DEVELOPABLE AREA DEVELOPABLE AREA CLUBHOUSE AMENITY AREA CLUBHOUSE AMENITY AREA CLUBHOUSE AMENITY AREA DEVELOPABLE AREA (ASPEN HEIGHTS) - POOL - SPORT COURT (BASKETBALL COURT) - CLUBHOUSE A - UNITS: TWO-FAMILY DETACHED UNIT (2 BEDROOMS PER UNIT) B - UNITS: TWO-FAMILY DETACHED UNIT (3 BEDROOMS PER UNIT) C - UNITS: 3, 4, 5 & 6 UNIT ROW HOMES (2-3 BEDROOMS PER UNIT) D - UNITS: SINGLE FAMILY DETACHED UNIT (4 BEDROOMS) E - UNITS: SINGLE FAMILY DETACHED UNIT (4-5 BEDROOMS) REGIONAL DETENTION POND AREA UNDEVELOPED REMNANT PARCEL LEGEND ATTACHMENT 2 ATTACHMENT 2 ATTACHMENT 3 ATTACHMENT 3 ATTACHMENT 4 ATTACHMENT 4 ATTACHMENT 5 ATTACHMENT 5 ATTACHMENT 6 CAG Meeting Clerk’s Conference Room November 11, 2012 7:30‐8:30 am Members Present: Neil, Don, Clark Mapes, Tim, Megan, Grant, Bridget, Mike Bello, Dean Hoag Guests: Rich Shannon, 3 Company Representatives 9 Members present, 4 guests Agenda Item #1: Aspen Heights Overview An Aspen Heights Representative gave an overview of their company and the style of homes that they intend to build. The Management Company is “in house”. The Aspen Heights project strives to keep low density Land Use. The representative gave an overview of the Aspen Heights project:  Location has a residential feel to it  Project site: all houses will face towards street or public ways, parking will be to the rear of buildings  Pedestrian oriented  Neighborhood feel  31 total acres, developed 27.45 acres  Total number of dwellings 220, 597 total residents (712 with extra occupancy approval)  Parking – 759 off street parking (about 3 ½ per dwelling)  Consist of: Clubhouse, sports court and swimming pool Improvements: reference (off site street improvements) URA assistance – asking for the road/maintenance around the detention pond – which is un‐usable – potential of 3rd party reimbursement. 26% of tax Regional ponds, majority of detention will be in the detention pond. Some will have to have their own smaller one, but one major. Pipes will be laid underneath. It is proposed that Storm Water utility would reimburse URA through a bridge loan for this. Storm water might have more in the budget to help out. Each area is paid for by certain departments – NECO ponds. Storm drainage is a bigger cost to the developer than the benefit. URA is looking at full build out. Q&A –  This is majority student housing: will not turn one away, but students living here want that quieter feel and it’s a more residential feel that makes parents comfortable having their kids here within the controlled environment ATTACHMENT 6  Have not had problems filling with other locations, locations have been further out than this location  Have arranged for bus stop  Accessible to downtown, shuttle service will be provided  Based on bedrooms and square foot. They are geared more to students because you pay per bedroom Agenda Item #2: Update on URA Budget: 2012 Tax Increment Revenue:  Budgeted: $913,815  Anticipated: $925,521  Interest: $109,500  A: $110,513 Loan Agreements:  NECCO Loan Agreements: $326,742 – NC Road $2.7 M  No redevelopment agreements  Bcc: building community 2013 Revenues:  $1,355,034 Expenses  $1,038,683 Reviewed: Existing loans ACTION: Megan to bring financial forecast (or distribute) Next Steps: Question: Midtown: Capstone: End date of URA – 2029 Cost be tracked for the mall – revenue will come; agreement will come to recover costs. N. College Plan ATTACHMENT 7 1 CAG Meeting Clerk’s Conference Room December 13th 7:30 – 8:30 am Members Present: Neil Mcaffrey, Andy Smith, Brigitte Schmidt, Larry Owen, Grant Sherwood, Don, Megan Bolin, Jim, Tim Kenney, Mike Bellow, Dean Hoag, Bob Brown, Ben Manvel Guests: Josh Birks, Chris Donegon Aspen Heights Representatives: Rich Shannon, Deanne Agenda Item 1: Aspen Heights and Overview of Financial Summary Goal: To get a formal recommendation from CAG Financial Request Summary Project description: student housing project, 712 total bedrooms 1. Off‐site street improvements , URA to pay $764,156 Question: Is any of this reimbursable back to City when future development comes into play? Answer: Yes: When Old Town North and the East Side are developed, we would get reimbursed. There is concern over the open space area, what will happen with that? Will city take it on or will it become a blighted area? Dollars, in either case, the developer is coming in with the first dollars 2. Stormwater Detention Improvement, URA to pay & 558,187 a. Developer to pay: $547,385 3. Financial Request a. Total Project Cost: $46,538,171 i. Projected actual value: $34,000,000 ii. Projected Annual Tax Increment: $174,641 b. Total Property Tax Increment Expected: TIF : $2,794,253 c. Total TIF Requested: $784,934 i. 28% of tax increment request d. Potential Bridge Loan for NECCO Improvements: $537,410 (Does not include cost to finance) ATTACHMENT 7 2 Tim expressed concern over the 28%, if reimbursement does not come through is this percentage going to rise, and if so, is everyone comfortable with that? Josh gave an explanation of this process. Rich Shannon gave the explanation of how the reimbursement is done; it is when your development agreement is signed, not when the work is done. This agreement should be done within the next five months, there is currently no other project in line of this scale to ask for reimbursement. The risk is very low. There is writing in the code (land use code) that specifies how this is reimbursed. There was a suggestion of having someone do a study of the Midtown Capstone Project and see what the revenue increase was. Comments:  Dean: Like the development, not asking to high of percentage, comfortable with the project.  Bob: Expressed concern about the increased traffic load and creating more rental properties. o Response: Aspen Heights owns and maintains their properties, so the property is taken care of and maintained.  Grant: Exciting project for this area, this can have only a positive effect on North College.  Mike: This project adds rooftops, will be good for North College, the scorecard does not seem to be in favor, ownership is not Larimer County, but overall in favor, YES.  CSU: Students should be able to afford the asking price; this is no different than a 2 bedroom apartment within Fort Collins.  Don: This land will be used, it has been sitting empty for years, a good project for North Fort Collins and also a positive for North Fort Collins  Bridget: Vine and Lemay Intersection will be impacted o Traffic impacts: majority will go to campus, 5% distribution was not significant enough to warrant any improvements. o Concern was on the cut through traffic, but the street is not being finished at this time, so that is not relevant.  Don: Is this project going to contribute for an overpass on new vine?  Jim: Commitment for a Shuttle came up at last the CAG, it is in the proposal  Tim: Supports project Bypass scorecard? The scorecard does not look as good as the project; do we bypass and just vote? Voted to Bypass Scorecard: unanimous Grant moved for approval, Tim second. All in favor: Approved! ACTION ITEM: Financial Report for next month 1 Aspen Heights Redevelopment Agreement URA Board March 26, 2013 ATTACHMENT 8 2 Tonight’s Action • Resolution to adopt a Redevelopment Agreement between Breckenridge Land Acquisition, LP (Developer) and the Fort Collins Urban Renewal Authority (URA). 3 Project Description • NW corner of Redwood Street and re-aligned Vine Drive • 220 units, student-oriented housing • 62 duplexes • 76 multi-family units • 82 single-family units • 712 bedrooms for individual leasing • Approved Project Development Plan (PDP) 4 Off-site Street Improvements Completing Building first Redwood Street segment of re- aligned Vine Drive 5 Stormwater Detention Improvements Northeast College Corridor Outfall (NECCO) Project • Excavating 5.4 acre feet of pond • Installing 4 pipes 6 Public Benefits • Housing – Accommodates student population – Desired use for North College – Housing type variety • Public infrastructure – Regional-serving – Complete street network – Priority, adequate public facility improvements – Coordinated drainage system  City Plan  North College Corridor Plan  North College Infrastructure Funding Plan  North College Existing Conditions Survey 7 Financial Request Total Project Cost $46,538,171 Projected Actual Value $34,000,000 Projected Annual Tax Increment $174,641 Total Property Tax Increment Expected $2,532,295* TIF Requested $792,166** % of Total Tax Increment Requested 30% * Assumes 15 years of increment with zero growth. ** Does not include cost to finance. 8 Eligible Costs Physical Street and Utility Improvements $699,910 Street Landscaping $63,756 Dry Creek CLOMR/LOMR $15,000 Tree Removal $8,100 Replacement Tree Upsizing $5,400 Total Eligible Costs $792,166 • TIF request = $792,166 • Road and streetscape improvements for re-aligned Vine Drive and Redwood Street 9 TIF Reimbursement Structure • Developer receives annual reimbursement payments from actual tax increment revenue • 10% increment retained by URA • 90% increment reimbursed to Developer – Eligible costs + 3.25% interest/year Example: $170,000 annual increment collected  10% = $17,000 to URA  90% = $153,000 to Developer for eligible costs + interest 10 Key Reimbursement Points • Developer must obtain C.O.s for at least 50% of buildings before URA will make 1st payment. • URA may pre-pay the reimbursement at any time. • If tax increment projection is accurate, would take URA 7 years to fulfill reimbursement obligation. • 10-year cap on reimbursement payments. 11 Financial Summary Total Project Cost $46.5 Million • Private Debt $35 Million • Developer Equity $8.9 Million • City Street Oversizing $639 K • City Stormwater $537 K * • URA TIF $894 K (35% of total increment) ($792 K eligible costs) ($101 K interest) * URA may provide a loan to facilitate timely reimbursement 12 Bridge Loan • Developer is eligible for $537,410 reimbursement from Stormwater for NECCO piping. • Timing of the reimbursement is uncertain. • If needed, URA would provide a loan to ensure timely reimbursement. • Not addressed in the Redevelopment Agreement and would require a separate action. 13 Recommendations • North College Citizen Advisory Group (CAG) unanimously recommends providing TIF. • Staff recommends adoption of the Resolution. 14 Thank you RESOLUTION NO. 052 OF THE BOARD OF COMMISSIONERS OF THE FORT COLLINS URBAN RENEWAL AUTHORITY APPROVING A REDEVELOPMENT AGREEMENT BETWEEN THE FORT COLLINS URBAN RENEWAL AUTHORITY AND BRECKENRIDGE GROUP FORT COLLINS COLORADO FOR THE ASPEN HEIGHTS PROJECT WHEREAS, Breckenridge Group Fort Collins Colorado (the “Applicant”) desires to construct a new residential development with approximately 220 rental units for student-oriented housing east of College Avenue, between Conifer Street and re-aligned Vine Drive (the “Project”); and WHEREAS, the Project is located within the boundaries of the Urban Renewal Plan Area described in the Urban Renewal Plan for the North College Avenue Corridor (the “Urban Renewal Plan”); and WHEREAS, the Fort Collins Urban Renewal Authority (the “Authority”) is authorized pursuant to Section 32-25-107(9), Colorado Revised Statutes, to fund projects utilizing property tax increment generated by redevelopment within the Urban Renewal Plan Area; and WHEREAS, in order to proceed with the Project certain public street and stormwater infrastructure must be constructed; and WHEREAS, Authority staff has worked with the Applicant to identify appropriate financial assistance from the Authority that would enhance the likelihood that the Project will be built; and WHEREAS, the Applicant estimates that the total private investment in the Project will be approximately $46.5 million; and WHEREAS, the Applicant has requested that the Authority provide a total of $1,329,576 in assistance for public improvements that will not only address the impacts of the Project but will also benefit the community at large; and WHEREAS, the Authority calculates that the Project will generate approximately $174,641 annually in property tax increment; and WHEREAS, Authority staff and the Applicant have discussed a financial assistance package that includes reimbursing the Applicant for constructing public improvements that would normally be the sole responsibility of the Applicant, with the potential for partial repayments from other benefitted properties and partial reimbursements from the City for costs associated with regional stormwater facilities; and WHEREAS, Authority staff has prepared for the Board of Commissioners of the Authority (the “Board”) a proposed agreement between the Authority and the Applicant that sets forth the terms and conditions upon which financial assistance will be provided to the Applicant by the Authority (the “Agreement”); and WHEREAS, the Agreement is attached hereto as Exhibit “A” and incorporated herein by this reference; and WHEREAS, the Board believes that the Agreement is in the best interests of the Authority. NOW THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMISSIONERS OF THE FORT COLLINS URBAN RENEWAL AUTHORITY as follows: Section 1. That the Board hereby finds that it is in the best interests of the Authority to provide financial assistance to the Applicant pursuant to the terms and conditions contained in the Agreement because the Project will, within the Urban Renewal Plan Area, improve the property and sales tax base, enhance and build public infrastructure, eliminate blight and otherwise further the purposes, goals, and objectives of the Urban Renewal Plan for the North College Avenue Corridor. Section 2. That the Agreement is hereby approved, and the Executive Director is authorized to execute the Agreement, subject to such modifications in form or substance as the Executive Director may, in consultation with the Authority Attorney, deem desirable and necessary to protect the Authority’s interests, or to further the purposes of the Urban Renewal Plan and this Resolution. Passed and adopted at a regular meeting of the Board of Commissioners of the City of Fort Collins Urban Renewal Authority this 27th day of March A.D. 2013. Chairperson ATTEST: Secretary 2‐22‐2012 – Redlined by JAM REDEVELOPMENT AGREEMENT ASPEN HEIGHTS This Agreement is made and entered into effective as of the ___ day of _________, 2013, by and between the Fort Collins Urban Renewal Authority, a body corporate and politic of the State of Colorado (the “Authority”), and Breckenridge Group Fort Collins Colorado, a Texas limited liability company (the “Developer”). RECITALS WHEREAS, on June 6, 1978, the City Council of the City adopted Resolution 78‐49, adopting findings and establishing an urban renewal authority; and WHEREAS, on December 21, 2004, the City Council of the City adopted Resolution 2004‐152, making findings and approving the Urban Renewal Plan for the North College Avenue Corridor (the “Plan”); and WHEREAS, the purpose of this Agreement is to eliminate blight and otherwise implement and further the above‐referenced Resolutions, and the purposes, policies, goals, and objectives of the Authority and the Plan, pursuant to the Colorado Urban Renewal Law, Part I of Article 25 of Title 31, C.R.S. (the “Act”); and WHEREAS, the Developer is under contract to acquire the Property as hereinafter described; and WHEREAS, the Property is within the Urban Renewal Area described in the Plan, and is within the area in which property taxes have been divided pursuant to the Act and the Plan, in order to create property tax increment to fund redevelopment and public improvement projects of the Authority; and WHEREAS, the Authority and the Developer wish to cooperate in the redevelopment of the Property in furtherance of the Plan by entering into this Agreement. AGREEMENT NOW THEREFORE, in consideration of the promises and the mutual obligations of the Parties and other good and valuable consideration, the receipt and adequacy of which are acknowledged, the Parties agree as follows. SECTION 1. DEFINITIONS In this Agreement, unless a different meaning clearly appears from the context: 2 Act means the Colorado Urban Renewal Law, Part I of Article 25 of Title 31, C.R.S. Agreement means this Agreement, as it may be amended or supplemented in writing. References to Sections or Exhibits are to this Agreement unless otherwise qualified. Building or Buildings mean one or more of the buildings identified in Exhibit A. Certificate of Occupancy shall have the same meaning as set forth in the City Code. Certificate of Valuation means the certification by the Larimer County Assessor’s Office to determine predicted valuation of the Project once complete that is attached as Exhibit D. Charter means the Municipal Charter of the City of Fort Collins. City means the City of Fort Collins, Colorado. City Code means the Municipal Code of the City of Fort Collins. Commence Construction and Commencement of Construction mean the obtaining of a development construction permit for the construction of the Public Improvements for the Project, if the Developer diligently pursues the construction of the Public Improvements under the permit in a manner necessary to Complete Construction of the Project. Complete Construction and Completion of Construction with respect to the Public Improvements mean acceptance by the City of the Public Improvements. With respect to any Building, Complete Construction and Completion of Construction mean that: 1) construction of the Building is complete in accordance with applicable laws, ordinances and regulations; and 2) Certificate of Occupancy has been issued for the Building for its intended permitted use without restrictions. With respect to the Project, Complete Construction and Completion of Construction means that: 1) the Larimer County Assessor has certified that the real property valuation for the Property has changed from vacant land to residential; and 2) construction of all, or substantially all, Buildings that are part of the Project have been completed. Control or Controlled by, with respect to any entity, means possession of the power to direct or cause the direction of the management and policies of the entity, whether through the ownership of the majority of voting securities, by contract, or otherwise. Covenant Not to Protest means the Covenant Not to Protest the valuation of the Property for real property tax purposes by the Larimer County Assessor required under Section 2.11. 3 Developer means Breckenridge Group Fort Collins Colorado, a Texas limited liability company, and any successors and assigns as may be permitted under Section 2.9 of this Agreement or as may be approved by the Authority. Developer Financing means the financing described in Section 2.1. Development Agreement means the Development Agreement for the Project, once the same has been approved by the City. Eligible Costs means the reasonable and necessary expenditures to design and construct the Public Improvements as identified on Exhibit B incurred by the Developer subsequent to the date of this Agreement, as certified by the Developer and, at the Authority’s option, verified by an appropriate expert. Eligible Costs shall not include interest paid or accrued on any such expenditures. Eligible Costs Cap means the maximum amount of Eligible Costs reimbursable to the Developer for the Public Improvements, in the amount of Seven Hundred and Ninety‐Two Thousand, One Hundred and Sixty‐Six Dollars ($792,166.00), excluding interest to the extent the same is reimbursable hereunder. Final Development Plan means the Final Development Plan for the Project, once the same has been approved by the City. Land Use Code means the Land Use Code of the City of Fort Collins. Party or Parties means a party or the parties to this Agreement, as first identified above. Plan and Urban Renewal Plan mean the North College Urban Renewal Plan described in the Recitals. Pre‐Project Tax Base Amount means the amount deemed for the purposes of this Agreement to be the taxes paid on the Property in 2012 before the construction of the Project, and certified as such by the Larimer County Assessor’s Office as shown on Exhibit D, which the Parties agree shall be $71,040.74. Project means the design, construction and reconstruction of all improvements, infrastructure, parking, streets, rights‐of‐way, buildings, structures, signage, and landscaping to be constructed on the Property pursuant to the Final Development Plan and Development Agreement, and includes, but is not limited to, the Public Improvements and Buildings. Property means the real property legally described as follows: 4 A TRACT OF LAND LOCATED IN THE SOUTH HALF (S1/2) OF SECTION ONE (1), TOWNSHIP SEVEN NORTH (T.7N.), RANGE SIXTY‐NINE WEST (R.69W.) OF THE SIXTH PRINCIPAL MERIDIAN (6TH P.M.), CITY OF FORT COLLINS, COUNTY OF LARIMER, STATE OF COLORADO, AND BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTH QUARTER CORNER OF SAID SECTION ONE (1) AND ASSUMING THE SOUTH LINE OF SOUTHWEST QUARTER OF SAID SECTION ONE (1) AS BEARING SOUTH 89°39ʹ23ʺ EAST BEING A GRID BEARING OF THE COLORADO STATE PLANE COORDINATE SYSTEM, NORTH ZONE, NORTH AMERICAN DATUM 1983/2007, A DISTANCE OF 2646.37 FEET WITH ALL OTHER BEARINGS CONTAINED HEREIN RELATIVE THERETO; THENCE ALONG THE CENTERLINE OF SAID SECTION ONE (1) NORTH 00°19ʹ18ʺ EAST A DISTANCE OF 719.83 FEET; THENCE NORTH 56°45ʹ36ʺ WEST 79.29 FEET TO THE POINT OF BEGINNING, SAID POINT OF BEGINNING LYING ON THE WEST RIGHT‐OF‐WAY LINE OF REDWOOD STREET AS PLATTED IN THE REPLAT NO. 1 OF EVERGREEN PARK FOUND AT RECEPTION NUMBER 85405, BOOK 1597, PAGE 128 IN THE RECORDS OF THE LARIMER COUNTY CLERK AND RECORDER; THENCE ALONG SAID WEST RIGHT‐OF‐WAY LINE NORTH 01°27ʹ22ʺ EAST A DISTANCE OF 427.21 FEET TO THE BEGINNING POINT OF A CURVE, NON‐TANGENT TO THE AFORESAID LINE ON THE PROPOSED NORTH RIGHT‐OF‐WAY LINE OF EAST VINE DRIVE; THENCE ALONG SAID PROPOSED RIGHT‐OF‐WAY LINE AND ALONG THE ARC OF A CURVE CONCAVE TO THE NORTHWEST A DISTANCE OF 24.18 FEET, SAID CURVE HAS A RADIUS OF 15.00 FEET, A DELTA OF 92°22ʹ32ʺ AND IS SUBTENDED BY A CHORD THAT BEARS SOUTH 47°38ʹ38ʺ WEST A DISTANCE OF 21.65 FEET TO A POINT OF TANGENCY (PT); THENCE CONTINUING ALONG SAID PROPOSED RIGHT‐OF‐WAY LINE NORTH 86°10ʹ06ʺ WEST A DISTANCE OF 196.14 FEET TO A POINT OF CURVATURE (PC); THENCE CONTINUING ALONG SAID PROPOSED RIGHT‐OF‐WAY LINE AND ALONG THE ARC OF A CURVE CONCAVE TO THE NORTHEAST A DISTANCE OF 425.84 FEET, SAID CURVE HAS A RADIUS OF 1442.50 FEET, A DELTA OF 16°54ʹ52ʺ AND IS SUBTENDED BY A CHORD THAT BEARS 5 NORTH 77°42ʹ40ʺ WEST A DISTANCE OF 424.30 FEET TO A POINT OF TANGENCY (PT); THENCE CONTINUING ALONG SAID PROPOSED RIGHT‐OF‐WAY LINE NORTH 69°15ʹ14ʺ WEST A DISTANCE OF 236.07 FEET TO A POINT OF CURVATURE (PC); THENCE CONTINUING ALONG SAID PROPOSED RIGHT‐OF‐WAY LINE AND ALONG THE ARC OF A CURVE CONCAVE TO THE SOUTHWEST A DISTANCE OF 31.99 FEET, SAID CURVE HAS A RADIUS OF 1132.50 FEET, A DELTA OF 01°37ʹ07ʺ AND IS SUBTENDED BY A CHORD THAT BEARS NORTH 70°03ʹ18ʺ WEST A DISTANCE OF 31.99 FEET; THENCE NORTH 00°05ʹ41ʺ WEST ALONG A LINE NON‐TANGENT TO THE AFORESAID CURVE A DISTANCE OF 333.30 FEET; THENCE NORTH 90°00ʹ00ʺ EAST A DISTANCE OF 890.80 FEET TO AFORESAID WEST RIGHT‐OF‐WAY LINE OF REDWOOD STREET; THENCE ALONG SAID RIGHT‐OF‐WAY LINE NORTH 01°27ʹ22ʺ EAST A DISTANCE OF 403.16 FEET TO A POINT OF CURVATURE (PC); THENCE CONTINUING ALONG SAID RIGHT‐OF‐WAY LINE ALONG THE ARC OF A CURVE CONCAVE TO THE SOUTHWEST A DISTANCE OF 194.93 FEET, SAID CURVE HAS A RADIUS OF 358.85 FEET, A DELTA OF 31°07ʹ26ʺ AND IS SUBTENDED BY A CHORD THAT BEARS NORTH 14°06ʹ21ʺ WEST A DISTANCE OF 192.54 FEET TO A POINT OF TANGENCY (PT); THENCE CONTINUING ALONG SAID RIGHT‐OF‐WAY LINE NORTH 29°40ʹ04ʺ WEST A DISTANCE OF 62.81 FEET TO A POINT OF CURVATURE (PC); THENCE CONTINUING ALONG SAID RIGHT‐OF‐WAY LINE AND ALONG THE ARC OF A CURVE CONCAVE TO THE NORTHEAST A DISTANCE OF 230.03 FEET, SAID CURVE HAS A RADIUS OF 439.09 FEET, A DELTA OF 30°01ʹ03ʺ AND IS SUBTENDED BY A CHORD THAT BEARS NORTH 14°39ʹ33ʺ WEST A DISTANCE OF 227.42 FEET TO A POINT OF REVERSE CURVATURE (PRC); THENCE ALONG SAID RIGHT‐OF‐WAY LINE OF REDWOOD STREET TURNING INTO THE RIGHT‐OF‐WAY LINE OF CONIFER STREET AS PLATTED IN THE AFORESAID REPLAT NO. 1 OF EVERGREEN PARK AND ALONG THE ARC OF A CURVE CONCAVE TO THE SOUTHWEST A 6 DISTANCE OF 23.49 FEET, SAID CURVE HAS A RADIUS OF 15.00 FEET, A DELTA OF 89°43ʹ59ʺ AND IS SUBTENDED BY A CHORD THAT BEARS NORTH 44°31ʹ01ʺ WES T A DISTANCE OF 21.16 FEET TO A POINT OF TANGENCY (PT); THENCE CONTINUING ALONG SAID RIGHT‐OF‐WAY LINE OF CONIFER STREET NORTH 89°23ʹ00ʺ WEST A DISTANCE OF 0.52 FEET TO A POINT OF CURVATURE (PC); THENCE CONTINUING ALONG SAID RIGHT‐OF‐WAY LINE AND ALONG THE ARC OF A CURVE CONCAVE TO THE SOUTHEAST A DISTANCE OF 77.86 FEET, SAID CURVE HAS A RADIUS OF 185.87 FEET, A DELTA OF 24°00ʹ00ʺ AND IS SUBTENDED BY A CHORD THAT BEARS SOUTH 78°37ʹ00ʺ WEST A DISTANCE OF 77.29 FEET TO A POINT OF TANGENCY (PT); THENCE CONTINUING ALONG SAID RIGHT‐OF‐WAY LINE SOUTH 66°37ʹ00ʺ WEST A DISTANCE OF 325.35 FEET TO A POINT OF CURVATURE (PC); THENCE CONTINUING ALONG SAID RIGHT‐OF‐WAY LINE AND ALONG THE ARC OF A CURVE CONCAVE TO THE NORTHWEST A DISTANCE OF 223.74 FEET, SAID CURVE HAS A RADIUS OF 540.00 FEET, A DELTA OF 23°44ʹ22ʺ AND IS SUBTENDED BY A CHORD THAT BEARS SOUTH 78°29ʹ11ʺ WEST A DISTANCE OF 222.14 FEET TO A POINT OF TANGENCY (PT); THENCE CONTINUING ALONG SAID RIGHT‐OF‐WAY LINE NORTH 89°38ʹ38ʺ WEST A DISTANCE OF 635.41 FEET; THENCE SOUTH 00°21ʹ22ʺ WEST A DISTANCE OF 1067.73 FEET; THENCE SOUTH 89°31ʹ07ʺ EAST A DISTANCE OF 486.23 FEET; THENCE SOUTH 56°45ʹ36ʺ EAST A DISTANCE OF 1033.71 FEET TO THE POINT OF BEGINNING. Public Improvements means the improvements or activities and undertakings listed in Exhibit B that the Developer will construct in accordance with this Agreement, for design and construction of which the Eligible Costs will be incurred. The Parties acknowledge that some or all of the Public Improvements will be constructed by the Developer on land outside the boundaries of the Property. 7 Reimbursement Cap means the maximum Reimbursement Obligation of Eight Hundred and Ninety‐Four Thousand, Two Hundred and Eighty‐Seven Dollars ($894,287.00), subject to the conditions and limitations as provided in Section 3.1. Reimbursement Obligation means the obligation of the Authority to reimburse the Developer for the Eligible Costs in accordance with Section 3.1. Related Entity means any entity that is wholly owned or Controlled by the Developer. For purposes of this definition, the term “owned” means the ownership of 100% of the ownership interests in the entity; and the term “Controlled” shall have the meaning hereinabove set forth. Schedule of Performance means the schedule that governs the times for the performance by the Developer and the Authority attached hereto as Exhibit C. Urban Renewal Area means all of the area of real property, including public rights of way within the boundaries of the Urban Renewal Project as described and delineated in the Plan. SECTION 2. DEVELOPER OBLIGATIONS 2.1 Developer Financing. The Developer agrees to provide the Developer Financing currently expected to consist of approximately $8.9 million of Developer equity and $37.5 million in construction loans. The terms of the Developer Financing must be consistent with the requirements of this Agreement and adequate to Complete Construction of the Project in accordance with this Agreement and by the date specified in the Schedule of Performance. Subject to obtaining Developer Financing, the Developer represents and agrees that it has the financial and legal ability and can bear the economic risk of financing and achieving Completion of Construction of the Project, the costs of which are to be paid in accordance with the terms and conditions of this Agreement and the approved construction documents. The Authority acknowledges that the terms and conditions of the Developer Financing will be determined by separate agreements and instruments to which the Authority will not be a party, which agreements and instruments shall not alter or affect the respective rights and obligations of the Developer and the Authority under this Agreement. Accordingly, the Authority acknowledges, subject to the foregoing, that the Developer and other parties to the Developer Financing are entitled to establish, modify or amend the terms of the Developer Financing, without the consent of the Authority. 2.2 Demolition, Clearance and Preparation of the Property. The Developer will demolish and clear any existing improvements from the Property and prepare the Property for construction of the Project. This work shall be performed in accordance with the requirements of all applicable laws, rules, and regulations, including those of the City. 2.3 Design and Construction of the Project. The Developer is responsible for obtaining and reviewing all information that the Developer believes is necessary or desirable to fulfill its 8 obligations under this Agreement. Subject to obtaining the Developer Financing, the Developer agrees to construct the Project in accordance with this Agreement. The Schedule of Performance sets forth the inside and outside dates for obtaining Developer Financing and Completion of Construction of the Public Improvements, Buildings, and the Project. The Developer, subject to the approval of the Authority, which approval shall not be unreasonably withheld, conditioned or delayed, shall have sole responsibility for the design, development and construction of the Public Improvements, the Buildings, and the Project, including without limitation, design, construction, selection, and supervision of any architects, engineers, and consultants. For construction of the Project, the Developer agrees to select contractors that the Developer’s architect deems qualified by experience to construct a Project of this quality and caliber. Regardless of the costs incurred by the Developer for the Project, the Authority’s Reimbursement Obligation shall not exceed the Reimbursement Cap. 2.4 Approval of the Construction Documents and Modifications to the Final Development Plan. The Developer shall prepare and obtain the approval of the City and the Authority, including, but not limited to, the City’s development review process and independent review by the Authority, of all construction documents related to construction of the Project and the Final Development Plan. Approval by the Authority shall not be unreasonably withheld, conditioned or delayed. 2.5 Construction of the Public Improvements. Subject to obtaining the Developer Financing, the Developer shall Commence Construction and Complete Construction of the Public Improvements in accordance with the City’s reasonable and applicable standards and requirements. These activities will occur on or before the dates specified in the Schedule of Performance. All construction activities shall conform to all applicable laws, codes, ordinances, and policies, including, but not limited to, those of the City. 2.6 Property Ownership. Developer agrees to have the Property purchased and titled in its name as Owner, or in the name of a Related Entity as Owner, no later than the date set forth in the Schedule of Performance, and specifically acknowledges that the failure to do so will result in the immediate and automatic termination of this Agreement. In the event of such termination, the parties shall have no further right or obligations hereunder, and each shall bear any costs incurred in performance of this Agreement. 2.7 Books and Accounts; Financial Statement. The Developer will keep, or cause to be kept, proper and current books and accounts in which complete and accurate entries shall be made of amounts paid out, and such other calculations, allocations and payments as are necessary to construct the Project. 2.8 Inspection of Records. All books, records and reports in the possession of the Developer relating to the Project shall at all reasonable times and subject to twenty‐four (24) hours advance notice be open to inspection (at Authority expense) by such accountants or other agents as the Authority may from time to time designate. 9 2.9 Restrictions on Assignment and Transfer. Except as hereinafter permitted, prior to Completion of Construction of the Project the Developer shall not assign or transfer all or any part of or any interest in this Agreement or the Property without the prior written approval of the Authority, which approval shall not be unreasonably withheld, conditioned or delayed. For the purposes of this Agreement (a) an assignment or transfer shall include a change in the identity of the parties in Control of the Developer, and (b) unreasonably withheld, conditioned or delayed shall mean failing to approve within ten business days without identifying legitimate concerns of the Authority related to, but not limited to, the generation of tax increment, the capacity of the assignee or transferee to Complete Construction, and the preservation and promotion of the Plan. The Developer shall, upon the Developer’s gaining of knowledge thereof, promptly notify the Authority of any and all changes whatsoever in the identity of the parties in Control of the Developer, or the degree thereof. No voluntary or involuntary successor in interest of the Developer shall acquire any rights or powers under this Agreement except as expressly set forth herein. Approval of an assignment or transfer by the Authority shall not relieve the Developer of its obligations hereunder to Complete Construction of the entire Project, unless the Authority agrees in writing. The foregoing Restriction on Assignment and Transfer shall terminate upon Completion of Construction of the Project. Notwithstanding the foregoing, subject to receipt and approval of all relevant documents confirming such transfer or assignment, the Developer may: (i) assign this Agreement and transfer the Property to a Related Entity of the Developer; (ii) collaterally assign its right to receive reimbursement under this Agreement to any lender that provides all or any portion of the Developer Financing, provided that any document assigning the Developer’s right to receive reimbursement hereunder shall specifically provide that no reimbursement will be made by the Authority unless and until Completion of Construction of the entire Project by the Developer in accordance with the terms of this Agreement; (iii) enter into a contract to sell all or a portion of the Project upon Completion of Construction of the entire Project, provided that a closing of any such sale may not occur prior to Completion of Construction of the entire Project by the Developer without the Authority’s consent. Except when a permitted assignee expressly assumes such obligation, any permitted assignment of this Agreement or transfer of the Property shall not relieve the Developer of its obligation to complete Construction of the entire Project pursuant to the terms of this Agreement. 2.10 Progress Reports. Until Completion of Construction of the Project the Developer shall make reports in such detail and at such times as the Authority may reasonably request as to Developer’s progress with respect to the Commencement of Construction, the progress of construction and the Completion of Construction as described in the Schedule of Performance. 2.11 Protesting the Actual Value Determined by the Larimer County Assessor/Condition Precedent. The Developer, including any assignees and successors, agrees and acknowledges that the Reimbursement Obligation is funded by the Larimer County Assessor’s collection of property taxes. Consequently, Developer, and any assignees or successors, agrees that from the 10 date of this Agreement through December 31, 2029, if the Actual Value determined by the Larimer County Assessor is at or below the value set forth in the Certificate of Valuation (the “Valuation”) relied on by the Authority, and attached to this Agreement as Exhibit D, it will not protest the Actual Valuation of the Property determined by the Larimer County Assessor in an effort to reduce the property tax for the Property. If Developer, or any assignee or successor, either (i) protests the Actual Value when it is at or below the value set forth in the Valuation, or (ii) protests the Actual Valuation and succeeds in reducing it to an amount less than the Valuation, the Authority’s Reimbursement Obligation will be reduced proportionally commensurate with the reduction in Actual Value. The Developer will file a covenant with the Larimer County Clerk and Recorder reflecting this representation and agreement (“the Covenant Not to Protest”) upon the execution of this Agreement. The Authority shall have no obligation arising under this Agreement until the Covenant Not to Protest has been so recorded. In the event this Agreement is terminated for any reason whatsoever, the Covenant Not to Protest shall immediately and automatically terminate, become null and void, and be of no further force or effect. Upon termination of this Agreement, the Authority shall execute, acknowledge and deliver to the Developer such documents or instruments as may be necessary or reasonably required by a title company to delete and remove the Covenant Not to Protest from the chain of title to the Property. SECTION 3. AUTHORITY OBLIGATIONS 3.1 Reimbursement Obligation/Reimbursement Cap. The Authority agrees to reimburse the Developer for the Eligible Costs incurred and certified by the Developer, as more specifically provided herein, together with interest on such Eligible Costs, to the extent specifically provided herein (the “Reimbursement Obligation”). If, as presently contemplated by the parties, the contingencies and requirements described in this Agreement are satisfied, the Authority will reimburse to the Developer One Hundred Percent (100%) of the Eligible Costs incurred, up to the total amount of Seven Hundred Ninety‐Two Thousand, One Hundred and Sixty‐Six Dollars ($792,166.00) (the “Eligible Costs Cap”), together with interest thereupon, as provided below, up to a total maximum payment to the Developer of Eight Hundred Ninety‐Four Thousand, Two Hundred and Eighty‐Seven Dollars ($894,287.00) (the “Reimbursement Cap”). 3.2 Conditions for Reimbursement. 3.2.1 The Reimbursement Obligation is contingent upon Completion by the Developer of the Public Improvements. If this requirement is not met by the Outside Date specified in the Schedule of Performance attached hereto as Exhibit C, the Authority shall have no Reimbursement Obligation to the Developer and this Agreement shall be deemed null and void. 11 3.2.2 The Reimbursement Obligation is further contingent upon Completion by the Developer of Fifty Percent (50%) of the Buildings comprising the Project, which shall be deemed, for the purpose of this Agreement, to mean obtaining Certificates of Occupancy for no fewer than sixty‐six (66) residential Buildings within the Project. If this requirement is not met by the Outside Date specified in the Schedule of Performance attached hereto as Exhibit C, the Authority shall have no Reimbursement Obligation to the Developer and this Agreement shall be deemed null and void. 3.2.3 The Reimbursement Obligation is further contingent upon verification by the Authority that all insurance requirements set forth in Section 4, below, have been met and kept current. The Authority may delay payment of any Reimbursement Payment (as defined below) due, without accruing additional interest on the amount of such Payment, until the Developer provides reasonable evidence of full compliance with the insurance requirements. 3.2.4 The Reimbursement Obligation is limited to reimbursement for Eligible Costs for the specified Public Improvements, as set forth in Exhibit B, together with interest as provided below. The Developer shall provide documentation of the Eligible Costs using forms provided by the Authority. If this requirement is not met by the Outside Date specified in the Schedule of Performance attached hereto as Exhibit C, the Authority shall have no Reimbursement Obligation to the Developer and this Agreement shall be deemed null and void. After the Developer has submitted all required documentation of the Eligible Costs, the Authority shall review the documentation, and may arrange for verification and review of costs by an appropriate expert. In order for final documentation of Eligible Costs to be considered complete, the Developer must provide to the Authority lien waivers and releases for labor and materials provided for the Project. Upon completion of such review and verification, the Authority shall notify the Developer of the Authority’s determination of eligibility, and the costs determined to be Eligible Costs shall be considered reimbursable hereunder. 3.3 Payment of Reimbursement. After the Developer has completed performance of the Conditions for Reimbursement as described in Section 3.2, the Authority shall pay to the Developer the Reimbursement Obligation, as follows: 3.3.1 No later than January 31st of each calendar year after the Conditions for Reimbursement have been met, the Authority shall pay to the Developer Ninety Percent (90%) of the property tax increment determined by the Authority to have been generated by the Project on the Property and paid during the preceding calendar year (the “Reimbursement Payment”). The tax increment generated by the Project on the Property and paid in the preceding calendar year shall be 12 calculated by subtracting the Pre‐Project Tax Base Amount from the total amount of property taxes paid in that year. 3.3.2 A portion of the Reimbursement Payment shall constitute interest on the Eligible Costs. Such interest shall be paid at a rate of Three and One‐Quarter Percent (3.25%) per annum. The first Reimbursement Payment shall include interest on the Eligible Costs from the date on which the Conditions for Reimbursement have been met. All subsequent payments shall include interest for the preceding year on the principal amount of Eligible Costs then unpaid. A schedule illustrating estimated Reimbursement Payments is provided as Exhibit E, for illustration purposes only. 3.3.3 The total of all Reimbursement Payments shall not exceed the Reimbursement Cap. The Authority shall continue to annually pay to the Developer a Reimbursement Payment until the earlier of either: 1) the full payment of the Reimbursement Obligation up to the Reimbursement Cap; or 2) February 1, 2025. Upon the occurrence of either of these events, the Authority shall have no further obligation to the Developer for reimbursement hereunder. 3.4 Authority Right to Pre‐Pay. The Authority reserves the right to pre‐pay any amount due hereunder without penalty, in its discretion. 3.5 Possible Authority Temporary Loan. The Authority acknowledges that the Developer is required by the City, as a condition of approval of the Project, to install the first phase of the City’s regional drainage improvement project for the Northeast College Corridor Outfall (“NECCO”), and that in accordance with the City Code the City’s Stormwater Utility will reimburse the Developer for certain costs incurred in constructing such NECCO improvements. The Authority further acknowledges that such City Stormwater reimbursements are subject to the appropriation of funds sufficient and intended therefor by the City Council and that, in the event that the City Stormwater reimbursements are not fully appropriated and paid to the Developer upon Developer’s completion of the required NECCO improvements, the Authority agrees to work in good faith with the City to arrange a temporary Authority loan for the purpose of expediting the payment of Stormwater reimbursements to the Developer, subject to applicable legal constraints and requirements and subject to the approval of the City Council in its sole discretion. 3.6 Limitation. The Authority shall not enter into any agreement or transaction that impairs the rights of Developer under this Agreement, including, without limitation, the right to receive reimbursement for the Eligible Costs allocated to it in accordance with the procedures established in this Agreement; provided, however, nothing herein shall preclude the Authority from entering into other financial obligations, or other financial obligations with regard to the Project, so long as the Authority in its reasonable discretion concludes that its actions do not and will not in the future interfere with its obligations hereunder. 13 SECTION 4. INSURANCE AND INDEMNIFICATION 4.1 Insurance. At all times while the Developer is engaged in preliminary work on the Property or adjacent streets and during the period from the Commencement of Construction until Completion of Construction of the Project, the Developer shall carry, or cause its general contractor to carry, and, upon request, will provide to the Authority certificates of insurance as follows: a. Builder’s risk insurance (with a deductible not to exceed $5,000) in an amount equal to 100% of the projected replacement value of the Improvements at the date of Completion of Construction; b. Comprehensive general liability insurance (including operations, contingent liability, operations of subcontractors, completed operations, and contractual liability insurance) and umbrella liability insurance with a combined single limit for both bodily injury and property damage of not less than $1,000,000. Such insurance may carry a deductible in an amount not to exceed $10,000 per claim for property damage and $5,000 per claim for employee benefits; and c. Worker’s compensation insurance, with statutory coverage, including the amount of deductible permitted by statute. All such insurance policies shall be issued by responsible companies selected or approved by the Developer, subject to the reasonable Approval of the Authority and the City. Prior to Commencement of Construction, the Developer shall deliver to the Authority and the City policies or certificates evidencing or stating that such insurance is in force and effect. Each policy shall contain a provision that the insurer shall not cancel or modify it without giving written notice to the Developer and to the Authority and the City at least 30 days before the date the cancellation or modification becomes effective and shall name the Authority and the City as additional insureds, specifying that the insurance shall be treated as primary insurance. 4.2 Indemnification. The Developer shall defend, indemnify, assume all responsibility for and hold the Authority, the Authority’s commissioners, the City, the City’s council members, and the officers and employees of the City and the Authority harmless (including, without limitation, for attorneys’ fees and costs) from all claims or suits for and damages to property and injuries to persons, including accidental death, that may be caused by acts or omissions of the Developer under this Agreement or in connection with the Project, whether such activities are undertaken by the Developer or anyone directly or indirectly employed by or under contract to the Developer and whether such damage shall accrue or be discovered before or after termination of this Agreement. 14 SECTION 5. REPRESENTATIONS AND WARRANTIES 5.1 The Developer represents and warrants as follows: a. The Developer is a limited liability company under no disability that is qualified to do business in the State of Colorado, and has the legal capacity and the authority to enter into and perform its obligations under this Agreement. The Developer has duly authorized the execution, delivery and performance of this Agreement; b. The execution and delivery of this Agreement and such documents and the performance and observance of their terms, conditions and obligations have been duly and validly authorized by all necessary action to make this Agreement and such documents and such performance and observance are valid and binding upon the Developer; c. To the Developer’s current, actual knowledge, after reasonable inquiry, the execution and delivery of this Agreement and the documents required hereunder and the consummation of the transactions contemplated by this Agreement will not: i. conflict with or contravene any law, order, rule or regulation applicable to the Developer or to its governing documents, ii. result in the breach of any of the terms or provisions or constitute a default under any agreement or other instrument to which the Developer is a party or by which the Developer may be bound or affected, or iii. permit any party to terminate any such agreement or instruments or to accelerate the maturity of any indebtedness or other obligation of the Developer; d. To the Developer’s current, actual knowledge, after reasonable inquiry, there is no litigation, proceeding, initiative, referendum, or investigation or threat or any of the same contesting the powers of the Authority, the City, the Developer with respect to this Agreement that has not been disclosed in writing to the Authority; and e. The Developer has the necessary legal ability to perform its obligations under this Agreement and has the necessary financial ability, through borrowing or otherwise, to construct the Public Improvements, the Buildings and the Project, subject to the terms and conditions of this Agreement. This Agreement constitutes a valid and binding obligation of the Developer, enforceable 15 according to its terms, except to the extent limited by bankruptcy, insolvency and other laws of general application affecting creditors’ rights and by equitable principles, whether considered at law or in equity. 5.2 The Authority represents and warrants as follows: a. The Authority is an urban renewal authority duly organized and existing under applicable law and has the right, power, legal capacity, and the authority to enter into the Agreement and has authorized the execution, delivery and performance of this Agreement by proper action of its Board of Commissioners; b. To the Authority’s current, actual knowledge, after reasonable inquiry, the Authority knows of no litigation or threatened litigation, proceeding or investigation contesting the powers of the Authority or its officials with respect to the Project, this Agreement, or the Public Improvements that has not been disclosed to the Developer; c. To the Authority’s current, actual knowledge, after reasonable inquiry, the execution and delivery of this Agreement and the documents required hereunder and the consummation of the transactions contemplated by this Agreement will not: i. conflict with or contravene any law, order, rule or regulation applicable to the Authority or to its governing documents, ii. result in the breach of any of the terms or provisions or constitute a default under any agreement or other instrument to which the Authority is a party or by which it may be bound or affected, or iii. permit any party to terminate any such agreement or instruments or to accelerate the maturity of any indebtedness or other obligation of the Authority; and d. This Agreement constitutes a valid and binding obligation of the Authority, enforceable according to its terms, except to the extent limited by bankruptcy, insolvency and other laws of general application affecting creditors’ rights and by equitable principles, whether considered at law or in equity. The Authority will defend the validity of this Agreement in the event of any litigation arising hereunder that names the Authority as a party or which challenges the authority of the Authority to enter into or perform its obligations hereunder. SECTION 6. DEFAULT AND REMEDIES 16 6.1 Default by Developer. Default by Developer under the Agreement shall mean one or more of the following events: a. The Developer fails to obtain the Developer Financing as required and set forth in the Schedule of Performance; b. The Developer, in violation of Section 2.9 of this Agreement, assigns this Agreement or transfers any part of the Property, or any rights in the same; c. There is any change in Control of the Developer or in the identity of the parties in Control of the Developer that violates this Agreement; d. The Developer fails to provide the approved construction documents in accordance with this Agreement; e. The Developer fails to Commence Construction within a reasonable period of time after: (i) approval of the Final Development Plan, final construction drawings and issuance of permits by the City; (ii) funding of the Developer Financing and (iii) approval of revisions to the flood plain maps by FEMA; but in no event shall Developer fail to Commence Construction later than the Outside Deadline required by the Schedule of Performance; f. The Developer fails to purchase the Property by the Outside Deadline required in the Schedule of Performance; g. The Developer fails to complete its obligations by the Outside Deadlines that are contained in the Schedule of Performance; h. The Developer fails to materially observe or perform any other covenant, obligation or agreement required of it under this Agreement; or i. The Developer attempts to protest the actual value of the Property with the Larimer County Assessor in violation of this Agreement or the terms of the Covenant Not to Protest required under Section 2.11. If any Default is not cured within the time provided in Section 6.3 then the Authority may exercise any remedy available under this Agreement. 6.2 Default by the Authority under the Agreement shall mean one or more of the following events: a. The Authority fails to pay the Eligible Costs in violation of this Agreement; or 17 b. The Authority fails to materially observe or perform any covenant, obligation or agreement required of it under the Agreement. 6.3 Grace Periods. Upon a Default by either Party, that Party shall, upon written notice from the non‐defaulting Party, proceed diligently to cure or remedy the Default and, in any event, the Default shall be cured within 30 days (60 days if the Default relates to the Outside Deadline for Completion of Construction) after receipt of such notice, or the cure shall be commenced and diligently pursued to completion within a reasonable time if curing cannot be reasonably accomplished within 30 days, or 60 days if the Default relates to the Outside Deadline for Completion of Construction. 6.4 Remedies on Default. Whenever any Default occurs and is not cured under Section 6.3, the non‐defaulting Party may take any one or more of the following actions: a. Suspend performance under this Agreement until it receives assurances from the defaulting Party, deemed reasonably adequate by the non‐defaulting Party, that the defaulting Party will cure its default and continue its performance under this Agreement; b. Cancel and rescind the Agreement; provided, however, that if the default is related to Developer failing to meet an Outside Deadline in the Schedule of Performance, Developer will have an additional 30 days (60 days if the Default relates to an Outside Deadline for Completion of Construction) to cure prior to the Authority seeking this remedy; or c. Take whatever legal or administrative action or institute such proceedings as may be necessary or desirable in its opinion to enforce observance or performance of this Agreement, including, without limitation, specific performance or to seek any other right or remedy at law or in equity, including damages. 6.5 Delays; Waivers. Any delay by either Party in instituting or prosecuting any actions or proceedings or otherwise asserting its rights under the Agreement shall not operate as a waiver of such rights or deprive it of or limit such rights in any way. No waiver in fact made by a Party with respect to any specific default by the other Party under the Agreement shall be considered or treated as a waiver of the rights with respect to any other defaults by the other Party under the Agreement or with respect to the particular default except to the extent specifically waived in writing. It is the intent of the Parties that this provision will enable each Party to avoid the risk of being limited in the exercise of the remedy provided in the Agreement by waiver, laches or otherwise in the exercise of such remedy at a time when it may still hope to resolve the problems created by the default involved. 18 6.6 Enforced Delays. Any delays in or failure of performance by any Party of its obligations under this Agreement shall be excused if such delays or failure are a result of acts of God, fires, floods, strikes, labor disputes, accidents, regulations, order of civil or military authorities, shortages of labor or materials, or other causes, similar or dissimilar, that are beyond the control of such Party. 6.7 Rights and Remedies Cumulative. The rights and remedies of the Parties to the Agreement are cumulative, and the exercise by either Party of any one or more of such remedies shall not preclude the exercise by it, at the same or different times, of any other such remedies for any other default or breach by any other Party. SECTION 7. MISCELLANEOUS 7.1 Conflicts of Interest. None of the following shall have any personal interest, direct or indirect, in the Agreement: A member of the governing body of the Authority or of the City; an employee of the Authority or of the City who exercises responsibility concerning the Project, or an individual or firm retained by the City or the Authority who has performed consulting services in connection with the Project. None of the above persons or entities shall participate in any decision relating to the Agreement that affects his or her personal interests or the interests of any corporation, partnership or association in which he or she is directly or indirectly interested. 7.2 Antidiscrimination. The Developer, for itself and its successors and assigns, agrees that in the construction of the Public Improvements, the Buildings and the Project provided for in the Agreement and in the use and occupancy of the Property, the Developer will not discriminate against any employee or applicant for employment otherwise qualified because of race, color, creed, religion, sex, sexual orientation, age, disability (subject to the availability of a reasonable accommodation of the disability), marital status, ancestry, or national origin. 7.3 Title of Sections. Any titles of the several parts and sections of the Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. 7.4 No Third‐Party Beneficiaries. No third‐party beneficiary rights are created in favor of any person not a party to the Agreement. The parties acknowledge that rights hereunder may be assigned or transferred pursuant to Authority‐approved full or partial assignments of this Agreement. 7.5 Venue and Applicable Law. Any action arising out of the Agreement shall be brought in the Larimer County District Court and the laws of the State of Colorado shall govern the interpretation and enforcement of the Agreement, without giving effect to its conflicts of laws provisions. 19 7.6 Non‐liability of Officials, Agents and Employees. No council member, board member, commissioner, official, employee, consultant, attorney or agent of the Authority or the City shall be personally liable to the Developer under the Agreement or in the event of any default or breach by the City or Authority or for any amount that may become due to the Developer under the Agreement. No official, employee, consultant, attorney or agent of the Developer shall be personally liable to the Authority or the City under the Agreement or in the event of any default or breach by the Developer or for any amount that may become due to the Authority or the City under the Agreement. 7.7 Authority or City Not a Partner. Notwithstanding any language in this Agreement or any other agreement, representation, or warranty to the contrary, neither the Authority nor the City shall be deemed or represented as a partner or joint venturer of the Developer or any contractor or subcontractor performing work on the Property or the Public Improvements, the Buildings or the Project. Neither the Authority nor the City shall be responsible for any debt or liability of the Developer, or its managers or members, or such contractor or subcontractor. 7.8 Integrated Contract. This Agreement is an integrated contract and invalidation of any of its provisions by judgment or court order shall in no way affect any of the other provisions, which shall remain in full force and effect unless the Parties otherwise agree to an amendment. 7.9 Counterparts. The Agreement may be executed in counterparts, each of which shall constitute one and the same instrument. 7.10 Notices. A notice, demand, or other communication under the Agreement by any party to the other shall be in writing and sufficiently given if delivered in person or if it is delivered by overnight courier service with guaranteed next‐day delivery or by certified mail, return receipt requested, postage prepaid, and: a. In the case of the Developer, is addressed to or delivered to the Developer, with a copy to First Bank, as follows: Breckenridge Group Fort Collins Colorado, LLC Attn: Charlie Vatterott 1301 S. Capital of TX Hwy. Bldg. B, Suite 201 Austin, TX 78746 20 And First Bank Attn: Jeff King 1707 N. Main Street Longmont, CO 80501 b. In the case of the Authority, is addressed to or delivered to the Authority as follows: Executive Director Fort Collins Urban Renewal Authority 300 LaPorte Avenue PO Box 580 Fort Collins, CO 80522 And City Attorney City of Fort Collins 300 LaPorte Avenue PO Box 580 Fort Collins, CO 80522 or at such other substituted address as the affected party may, from time to time, designate in writing and forward to the other as provided in this Section. Notice provided by in‐person delivery or by overnight courier shall be considered delivered as of the verified date of delivery. Notice provided by regular U.S. Mail shall be considered delivered three (3) days after the date of deposit with the U.S. Postal Service. 7.11 Good Faith of Parties. In performance of the Agreement or in considering any requested extension of time or in the giving of any approval, the Parties agree that each will act in good faith and will not act unreasonably, arbitrarily, capriciously or unreasonably withhold, condition or delay any approval required by the Agreement. 7.12 Exhibits Merged. All Exhibits attached to the Agreement are expressly integrated herein. 7.13 Days. If the day for any performance or event provided for herein is a Saturday, Sunday or other day on which either national banks or the office of the Clerk and Recorder of Larimer County, Colorado, is not open for the regular transaction of business, the day for performance 21 shall be deemed to be the next day on which the banks or Clerk and Recorder are open for the transaction of business. 7.14 Further Assurances. Each Party agrees to execute such documents and take such action as shall be reasonably requested by the other Party to confirm, clarify or effectuate the provisions of this Agreement. 7.15 Certifications. Each Party agrees to execute such documents as the other Party may reasonably request to verify or confirm the status of this Agreement and of the performance of the obligations hereunder and such other matters as the requesting Party may reasonably request. 7.16 Amendments. This Agreement shall not be amended except by written instrument. Each amendment, which shall be in writing and signed and delivered by the Parties, shall be effective to amend the provisions hereof. 7.17 Survival of Representations, Warranties and Covenants. No representations or warranties whatever are made by any Party except as specifically set forth in this Agreement. The representations, warranties and indemnities made by the Parties and the covenants and agreements to be performed or complied with by the respective Parties shall be deemed to be continuing. Nothing in this Section shall affect the obligations and indemnities of the Parties with respect to covenants and agreements contained in this Agreement that are permitted or required to be performed in whole or in part after issuance of a Certificate of Occupancy. 7.18 Minor Changes. This Agreement has been approved in substantially the form submitted to the governing bodies of the Parties. The officers executing the Agreement have been authorized to make, and may have made, minor changes in the Agreement and the attached Exhibits as they have considered necessary. So long as such changes were consistent with the intent and understanding of the Parties at the time of Approval by the governing bodies, the execution of the Agreement shall constitute conclusive evidence of the approval of such changes by the respective Parties. 7.19 Joint Draft. The parties agree they drafted this Agreement jointly with each having the advice of legal counsel and an equal opportunity to contribute to its content. 22 IN WITNESS WHEREOF, the Authority and the Developer have caused the Agreement to be duly executed as of the day first above written. DEVELOPER: BRECKENRIDGE GROUP FORT COLLINS COLORADO, LLC, A Texas limited liability company By: BGFCC, LLC, a Delaware limited liability company, Its managing member By: ______________________________________ Name: _____________________________________ Title: _______________________________________ AUTHORITY: THE FORT COLLINS URBAN RENEWAL AUTHORITY By:_____________________________________________ Darin Atteberry, Executive Director ATTESTED: APPROVED AS TO FORM: By: __________________________ By: ____________________________ City Clerk Authority Legal Counsel EXHIBIT A Road Improvements and Streetscape Physical Street and Utility Improvements $ 699,910 Street Landscaping $ 63,756 Dry Creek CLOMR/LOMR $ 15,000 Tree Removal $ 8,100 Replacement Tree Upsizing $ 5,400 Total Eligible Costs $ 792,166 EXHIBIT B ELIGIBLE COSTS Action Responsible Party Target Date Outside Date Developer Financing Developer 31-May-13 31-Jul-14 Execution of Development Agreement Developer 31-May-13 31-May-14 Final Plan Approval Developer 31-May-13 31-May-14 Property Acquisition Developer 31-May-13 31-May-14 Deliver Proof of Insurance Developer 7-Jun-13 7-Jun-14 Development Construction Permit Developer 7-Jun-13 7-Jun-14 Commence Construction of Public Improvements Developer 10-Jun-13 10-Jun-14 Commence Construction of Buildings Developer 1-Oct-13 1-Oct-14 Obtain Certificates of Occupancy for 50% of Buildings Developer 3-Feb-14 3-Mar-15 Submit Documentation for Eligible Costs to URA Developer 3-Feb-14 3-Aug-14 Complete Project Developer 27-Jun-14 27-Jun-15 Repayment #1 URA 31-Jan-15 31-Jan-16 Repayment #2 URA 31-Jan-16 31-Jan-17 Repayment #3 URA 31-Jan-17 31-Jan-18 Repayment #4 URA 31-Jan-18 31-Jan-19 Repayment #5 URA 31-Jan-19 31-Jan-20 Repayment #6 URA 31-Jan-20 31-Jan-21 Repayment #7 URA 31-Jan-21 31-Jan-22 EXHIBIT C SCHEDULE OF PERFORMANCE ASPEN HEIGHTS TIF *2012/13 Mill levy subject to change, Approx values based on preliminary figures. 2013 TAX YEAR 2014 PAYABLE MILL LEVY* * EXISTING PARCELS 90.778 2011/12 value PORTIONS LAND SIZE LAND VALUE IMP VAL TTL IMP $/SF LAND VALUE 2014 ASSMT RATE 2011 taxes 2012 taxes EAST OF JAX SURPLUSVACANT LND 1,349,270 $2,698,540 $0 $2,698,540 $2.00 $8,770,255 29% $71,040.74 $71,040.74 * TIF: ESTIMATED VALUE: tax increment 2013/2014 PORTIONS LAND SIZE LAND VALUE IMP VAL $/SF LAND VALUE 2014 ASSMT RATE TAX GUESTIMATE DIFFERENCE ASPEN HGHTS multi family 1,349,270 $7,420,985 $26,579,015 $5.50 $34,000,000 7.96% $245,681.58 $174,640.84 $153,846 per unit ASSESSMENT RATE CHANGES FROM VACANT LAND TO RESIDENTIAL USE EXHIBIT D CERTIFICATE OF VALUATION Urban Renewal Authority Aspen Heights TIF Assistance Amount 792,166.00 # Annual Interest Rate 3.250% Annual TIF 174,641.00 First Year TIF (50%) 87,320.50 Developer Percentage 90% URA Percentage 10% Payment # Payment to Developer (Principal) Payment to Developer (Interest) Payment to Developer (Total)* Balance URA Retained TIF 1.00 52,843.06 25,745.40 78,588.45 739,322.95 8,732.05 2.00 133,148.90 24,028.00 157,176.90 606,174.04 $17,464.10 3.00 137,476.24 19,700.66 157,176.90 468,697.80 $17,464.10 4.00 141,944.22 15,232.68 157,176.90 326,753.58 $17,464.10 5.00 146,557.41 10,619.49 157,176.90 180,196.17 $17,464.10 6.00 151,320.52 5,856.38 157,176.90 28,875.64 $17,464.10 7.00 28,875.64 938.46 29,814.10 0.00 $17,464.10 792,166.00 102,121.05 894,287.05 113,516.65 # This is the max TIF rebate, actual amount will be based on actual costs paid by developer * No more than 90% of the collected TIF returned in a given year EXHIBIT E EXAMPLE REIMBURSEMENT PAYMENT SCHEDULE DATE: March 27, 2013 STAFF: Tom Leeson, Bruce Hendee Josh Birks AGENDA ITEM SUMMARY URBAN RENEWAL AUTHORITY 8 SUBJECT Resolution No. 053 Adopting Revised Policies and Procedures for the Urban Renewal Authority. EXECUTIVE SUMMARY As a follow up to the February 28, 2013 URA Board work session, this Resolution amends the adopted 2012 URA Policies and Procedures. As an alternative to required participation in IDAP, the amended Policies require participation in the EPA’s Energy Star program and the Target Finder system to set energy targets for new buildings and major renovations. Additionally, in an effort to meet the City of Fort Collins established goal of diverting 50% of the community waste from landfills, the amended Policies also requires URA funded projects to demonstrate that at least 50% of the waste materials by weight (excluding waste containing lead, asbestos or other hazardous material) generated by a construction or demolition project be diverted from the landfill through waste management options, such as reuse or recycling. The Resolution also delegates the authority to approve Administrative Procedures with the Executive Director, and includes some minor language changes for clarification purposes. BACKGROUND / DISCUSSION Energy Efficiency Requirements During the October 23, 2012 URA Board meeting, it was recommended that URA projects be required to participate in the Fort Collins Utilities Integrated Design Assistance Program (IDAP) as an alternative to requiring buildings to meet a LEED certification. Since that time, City Utilities has moved forward to redesign IDAP as a performance-based program in alignment with the Architecture 2030 Challenge, a program with a path to carbon neutral buildings by 2030. The new IDAP will require a significant commitment from property owners in terms of monitoring and program compliance and would be very difficult to achieve without willing property owners that are dedicated to the outcome. As an alternative to required participation in IDAP, it is recommended the Board consider requiring participation in the EPA’s Energy Star program and the Target Finder system to set energy targets for new buildings and major renovations (more than 50% of square footage affected). The Target Finder is an online tool that enables architects and building owners to set energy targets and receive an EPA energy performance score for projects during the design process (See Attachment 3 for program details). The program utilizes energy use targets based on actual building energy consumption data for more than a dozen building types. EPA’s Energy Star energy performance scale assigns a score between 1 and 100 for the corresponding energy use intensity for the specified project. Projects that earn a score of 75 or higher are eligible for Designed to Earn the Energy Star certification. A score of 75 means the building performs 35 percent better than typical, comparable buildings and represents the top 25 percent of existing buildings. The Target Finder is a comprehensive look at a building’s potential energy use as it takes into account building size, climate, operating hours, number of occupants, computer use, and occupant behavior. As a policy decision, the Board could choose to require URA projects that include new buildings, or major renovations to meet the Designed to Earn the Energy Star certification. While this requirement would be a major step in bringing energy use and efficiency to the forefront during the design phase, this level of participation does not require that new buildings actually perform at the designed target levels. The Board could choose to require that new buildings achieve the Energy Star label. Closing the loop between the design's intended energy use and the building's actual performance requires the commitment of the owner to earn the Energy Star label after the project is built and operating. An operating building that earns an EPA rating of 75 or higher for 12 consecutive months of energy bills and receives verification by a professional engineer or registered architect that the building meets indoor environmental standards qualifies to earn the Energy Star label. This step solidifies that the design intent has been translated into the building's actual performance. The following flow chart demonstrates the necessary process to obtain Design to Earn Energy Star versus obtaining and Energy Star label. March 27, 2013 -2- ITEM 8 Source: EnergyStar.gov It is recommended that URA projects that do not include new construction or major renovations (more than 50% of square footage affected) meet the current energy code, except for the building envelope requirements, which could be cost prohibitive. It is also recommended that energy use be monitored through the Energy Star program but not require any target energy performance level. The current code requires energy assessments prior to building alterations with valuations of $30,000 or greater, and requiring energy performance to be monitored will go a long way in bringing awareness of energy use and efficiencies to building owners. It should be noted that requiring new buildings and major renovations to achieve an Energy Star label will add cost to the design phase of a project. The design phase is considered a soft cost and represents a small percentage of overall project costs. Given the requirements in current building codes, meeting Energy Star label should not add any additional costs to overall hard costs. The advantage of the program is that it is focused on ensuring building systems are designed correctly and appropriately for the intended users, that system commissioning is carried out (currently a code requirement) and that monitoring take place over an extended period of time. Based on the discussion above, staff is recommending the following URA Policy: All URA projects that include new construction or major renovations of existing buildings (more than 50% of square footage affected) shall be required to meet the Energy Star label. Such projects shall be required to design buildings in such a manner as to be eligible for Designed to Earn the Energy Star (DEES) certification. Once buildings are completed, the energy use shall be monitored for 12 consecutive months to demonstrate the operating building earns an EPA rating of 75 or higher in Portfolio Manager and verification shall be received by a professional engineer or registered architect that the building meets indoor environmental standards and qualifies to earn the Energy Star label. Additionally, all URA projects that include renovations that affect less than 50% of existing square footage shall be required to meet the current energy code, except for the building envelope requirements, and energy use shall be monitored through the Energy Star program for 12-consecutive months in an effort to raise energy use awareness. Deconstruction/Construction Waste Recycling Requirements With the adoption of the green building amendments, all new construction is required to submit a construction waste recycling plan with the intent of diverting construction waste from the landfill. The program focuses on the materials in which the City has capacity to receive, which includes wood, metal, concrete, and cardboard. The current program does not apply to alterations. The requirement for a construction waste recycling plan addresses the waste material generated during the construction process, but does not address materials associated with the demolition of existing structures. As articulated in both City Plan and the Fort Collins Climate Action Plan, the City of Fort Collins established a goal to divert 50% of the community waste from landfills. As redevelopment occurs through the City of Fort Collins, a significant amount of material from demolished structures can be diverted from the landfills by ensuring structures are deconstructed, as opposed to demolished. Deconstruction is the process of systematically dismantling a structure in an environmentally, economically and socially responsible manner, aiming to maximize the recovery of materials for reuse and recycling. Deconstruction is commonly separated into two categories; "non-structural" and "structural". Non-structural deconstruction, also known as “soft-stripping”, consists of reclaiming non-structural components including appliances, doors, windows, and finish March 27, 2013 -3- ITEM 8 or trim materials. Structural deconstruction involves dismantling the structural components of a building; removing the entire building down to or including the foundation. Deconstruction, as a process, is more time consuming than standard demolition, and is generally more expensive. However, many of the additional costs associated with deconstruction can be reduced when taking into account reduced disposal costs, avoided purchases of new materials (if materials are re-used on site), revenue earned from material sales and potential tax incentives. Tax benefits can be obtained when materials are donated to a 501(c)(3), such as ReSource Fort Collins. Therefore, staff is recommending that all URA funded projects demonstrate that at least 50% of the waste materials by weight (excluding waste containing lead, asbestos or other hazardous material) generated by a construction or demolition project be diverted from the landfill through waste management options, such as reuse or recycling. Approval Process of Administrative Procedures The URA Administrative Procedures, which were most recently revised in October, 2012, have historically been approved by a URA Board Resolution. The Administrative Procedures were adopted as part of the Policies and Procedures, yet they serve a very different purpose. The Administrative Procedures are intended to provide both minimum procedural requirements for URA applicants and an operating framework for staff to implement the Policy and Procedures established by the URA Board. In an effort to allow staff the ability and flexibility to respond quickly to issues that arise when implementing the URA Policies, it is recommended that the Board delegate the authority to approve Administrative Procedures to the Executive Director. Any revisions to the Administrative Procedures will be presented to the URA Board. October 2012 URA Board Recommended Amendments During the October 23, 2012 URA Board meeting in which the Policy and Procedures were adopted, the Board requested staff to look at several sections and recommend possible language changes. The amendments, which are included within the attached redlined version of the policies, address the following policy sections: Section 2- Objectives • Presence of Floodplain language Section 4 – Evaluation Criteria • Financial Feasibility of Projects language Section 4 – Public Benefit • Affordable Housing as Public Benefit language. FINANCIAL / ECONOMIC IMPACTS The requirement for participation in the Energy Star program, as well as the required deconstruction/recycling of waste material may result in some additional costs to URA projects. While the additional costs may be eligible for reimbursement by tax increment financing, the additional costs could impact the financial feasibility of certain projects. Tax increment financing represents gap financing, meaning financing that covers the gap between a financially feasible project and non-financially feasible project. When Code requirements add costs to a project, in essence the gap becomes larger. This becomes a policy decision related to trade-offs for URA financing. As more of the tax increment is necessary to offset costs associated with Code requirements, less of the increment will be available for other improvements, such as required public infrastructure, that also contribute to the gap. ENVIRONMENTAL IMPACTS Ultimately, the benefit will be positive to the environment as each project will increase the level of quality and sustainability of all publicly funded URA projects. Benefits will include reduced energy use, increased diversion from the landfill and subsequently a lower carbon impact. March 27, 2013 -4- ITEM 8 STAFF RECOMMENDATION Staff recommends adoption of the Resolution. PUBLIC OUTREACH Given the relatively short period of time between the February work session and the Resolution adoption date, there has been less public outreach than is typical of similar policy changes. The following outreach effort shave been made: • URA Board Worksession - February 28 (Attachment 4) • Presentation to the Fort Collins Area Chamber of Commerce Local Legislative Affairs Committee – March 22 • Presentation to the Air Quality Advisory Board - March 18 • Agenda Item Summary provided to the Natural Resources Advisory Board and the Energy Board • Copies of proposed amendments sent to the North Fort Collins Business Association and the South Fort Collins Business Association. ATTACHMENTS 1. 2012 URA Policies and Procedures 2. 2013 Redlined URA Policies 3. Energy Star Target Finder Brochure 4. Work Session Summary, February 28, 2013 5. Power Point Presentation FORT COLLINS URBAN RENEWAL AUTHORITY POLICIES Revised October 2012 “The mission of the Urban Renewal Authority is to remedy blight, using Tax Increment Financing, to leverage private capital investment, and stimulate sustainable development and public improvement projects.” SECTION 1 – PURPOSE The purpose of this document is to provide guidance for the Fort Collins Urban Renewal Authority (URA) staff, recommending bodies, and URA Board (Board) in considering, reviewing and processing applications that seek to use Tax Increment Financing (TIF) for development activities within established TIF Districts. Policies are in accordance with Colorado Urban Renewal Law (C.R.S. § 31‐25‐101 et seq.) but have been adapted to further the City’s own vision and goals for the URA. The Board may, in its discretion, amend or waive sections of this document when determined necessary or appropriate. The fundamental purpose for application to the URA for TIF assistance is to facilitate desirable development/redevelopment projects within the URA TIF District that would not otherwise occur “but for” the assistance provided through TIF. The Board intends to provide the minimum amount of TIF assistance needed to make the project viable in order to preserve unencumbered TIF for District‐wide public improvements. The provision of financial assistance is at the sole discretion of the Board which shall, in its discretion, reject or approve projects on a case‐by‐case basis taking into account established policies, specific project criteria, and demands on City services versus potential public benefits received from the proposed project. Meeting policy guidelines and other criteria does not guarantee the award of TIF assistance. Furthermore, approval or denial of one project is not intended to set a precedent for approval or denial of any other project. SECTION 2 - OBJECTIVES The URA was established to accomplish the following objectives:  Eliminate blight.  Improve public infrastructure (streets, storm drainage, sewer, utilities, etc.) in areas where deficiencies exist.  Remove impediments to desired development, e.g., lack of infrastructure, environmental contamination, presence of floodplain, and/or unsuitable soils.  Retain, expand or attract businesses for the purpose of improving the City’s economic base as demonstrated by projects that retain jobs, create primary jobs, increase the manufacturing base, etc.  Create destination locations, including mixed‐use projects, which will capture additional revenue to the area. 1 ATTACHMENT 1  Encourage development projects that enhance the streetscapes and pedestrian experience and improve the vitality of commercial corridors by adding interest and activity.  Provide a variety of quality housing choices.  Encourage development that is consistent with City Plan, subarea plans, and approved Urban Renewal Plans.  Promote energy and water efficiencies within buildings and developments.  Protect natural habitats and features. SECTION 3 – ELIGIBLE COSTS The following are eligible costs that may be considered for TIF assistance:  Removal of hazardous materials or conditions (sites where remediation or mitigation is required).  Site clearance or site acquisition.  Land assemblage.  Parking/structured parking for the public.  Infrastructure that is extraordinarily costly to the project and/or serves other development and redevelopment facilitating further improvements in the area.  Sustainable and renewable energy features that reduce the environmental impact of the project.  Public amenities such as parks, plazas, community gathering areas and streetscapes to enhance the aesthetics of the area.  Capital Improvement Projects (CIP) as identified by the City of Fort Collins.  Projects listed in Infrastructure Plans related to the Plan area, e.g., North College Infrastructure Funding Plan.  Other qualifying expenses as permitted by Colorado Revised Statutes (C.R.S.) § 31‐25‐101 et seq. SECTION 4 – EVALUATION CRITERIA The following evaluation criteria will be used to review applications seeking TIF. Since every project is unique, additional evaluation criteria may become necessary and will be determined individually based on the merits of the project. Financial feasibility:  TIF assistance will not be considered for projects that have the financial feasibility to proceed without TIF assistance, except where exceptional circumstances warrant support for the project.  Individuals requesting TIF must demonstrate, to the satisfaction of the URA, sufficient equity investment in the project prior to seeking TIF. Equity is defined as cash or un‐ leveraged value in land or prepaid costs attributable to the project. Examples of equity may include personal cash, letter of credit, personal investment, awarded grant monies, etc. 2  Assistance will not be provided solely to increase the developer’s profit margin on the project. Prior to consideration of a TIF request, the URA will undertake a financial analysis of the project costs to ensure that the developer’s internal rate of return (IRR) is reasonable based on the characteristics of the project.  For projects that will generate more than $1 million in TIF or create a project that is more than 10,000 sq. ft. in size there may be an independent financial analysis. The independent analysis will be contracted for by the URA and the cost will be paid for by the applicant. Additionally, if the project is seeking more than 50% of the property tax increment generated from the project, or if the applicant is asking for requesting more than $150,000 in financial assistance, an independent financial analysis of the project may be required by the URA. Public Benefit:  A qualitative and/or quantitative analysis should be completed in order to identify the public benefits achieved by the project. Analysis of the benefits of the project will be measured against the expectations set in the relevant plans that may include, but not be limited by, City Plan (the City’s Comprehensive Plan), an Urban Renewal Plan, a community subarea plan, or an adopted policy, ordinance, or resolution of the City Council.  Public benefits that garner additional consideration by the URA Board include: - Affordable housing projects that exceed the minimum City Land Use Code definition of an “affordable housing project”. - Projects that have local ownership, which is defined to mean any home location, business, or developer located within a 40 mile radius from the City of Fort Collins Growth Management boundary. - Projects that achieve or exceed LEED Silver certification. - Projects that include early childhood care and/or education centers. - Historic preservation and/or adaptive reuse of historic structures.  Projects that do not provide sufficient public benefits may, after review, be provided feedback and allowed to submit a revised application. Revisions may lead to approval or final denial of the URA applicant and may include, but are not limited to: - Greater developer contribution; - Reduced TIF participation; and/or - Redefinition of the scope of the project. Section 5 – Other General Policies  If substantial URA expense may be involved during screening, reviewing, and/or negotiating, a party requesting assistance from the URA may be asked to pay a deposit in order to fund URA staff or contractual work in advance of the URA incurring significant costs; furthermore, contractual commitments to fund appropriate work or other expenses may be required in advance of, or in connection with, a formal application or other request for assistance. 3  The applicant must be able to demonstrate to the Board’s satisfaction an ability to construct, operate, and maintain the proposed project based upon past experience, general reputation, and credit history.  TIF assistance for land/property purchase costs will not be provided in an amount exceeding the fair market value of the property. Fair market value will be determined by an independent appraiser hired by URA staff. The cost of the appraisal will be paid for by the applicant.  There will be no interest paid on any portion of the applicant’s reimbursable expenses.  TIF will not be used to retroactively reimburse projects or make payments to cover costs associated with any actions incurred by a development/redevelopment prior to execution of the Redevelopment Agreement, except for eligible hard costs associated with public improvements required of the project as approved by the Board. 4 FORT COLLINS URBAN RENEWAL AUTHORITY ADMINISTRATIVE PROCEDURES Revised October 2012 SECTION 1 - APPLICATION REQUIREMENTS The applicant must complete the TIF application in its entirety, including the following documentation:  A location map  Site plans or project drawings/perspectives/elevations  Project pro-forma included, but not limited to: - Estimate of construction costs from licensed general contractor - Breakdown of public verses private improvements - Projected rents with vacancy assumption - Project schedule  Owner/Business resume  A proposed project timetable indicating the estimated time frame for major steps including the City’s planning decision, completion of financial commitments, start of construction, and issuance of Certificate of Occupancy (CO).  Executive Summary with answers to the following questions: – What is the nature of the project? – Why is TIF assistance needed and how will the funds be used? – What sources of financing will the project secure other than TIF? – How will the project help improve/upgrade public infrastructure (streets, utilities, drainage, etc.)? – How will the project enhance the property tax base (and sales tax base, if applicable) of the area? – How will the project help achieve the goals of the Urban Renewal Plan and City Plan? – How will the project help eliminate slum and blight conditions? – How will this project help achieve the URA goals of sustainability through green building techniques? Please be specific how this project uses energy and water efficiency exceeding code requirements, renewable resources, natural resource conservation techniques, or stormwater low impact design methods. SECTION 2 – APPLICATION PROCESS  Applications may be submitted to URA staff at any time during regular business hours.  After URA staff has done a preliminary analysis and made suggested edits or modifications to the application, there will be a final submittal.  After the final submittal, the financial analysis will take place. If the analysis is completed by an independent consultant, additional time may be required depending on availability. 5  Additional community-based input from affected groups may be required. – Feedback from community-based input (e.g., North Fort Collins Business Association, South Fort Collins Business Association) may require modifications that delay approval and even require additional financial analysis. – If the application is for a project within the North College Urban Renewal Plan Area, the North College Citizen Advisory Group (CAG) must make a recommendation by a majority vote. The CAG meets on a monthly basis and the proposed project/TIF application will be scheduled on the agenda once the financial analyses are completed and the URA staff has adequate information and achieved a staff recommendation to present.  The final application will be reviewed by the URA Team, which includes staff representatives from the following Departments: - Economic Health - Engineering - Utilities - Planning - Legal - Finance  If the fundamental objectives of the URA are not clearly met, the application will be denied by staff and will not move forward to the Board for approval. The applicant may re-apply if there is a significant financial change affecting the project’s financial feasibility, or if the project changes extensively from the original application and should be considered on its own merit.  If the URA Team recommends the application, staff will work with the applicant to create a project specific Redevelopment Agreement (RA) that will define the terms of URA participation and TIF assistance for the project.  Once a final RA is agreed to, URA staff will schedule the application for consideration at a hearing before the Board. The Board typically meets bimonthly on Tuesday evenings.  The Board will consider the application at the scheduled meeting. The Board will decide whether or not to support the application. The Board’s action may include: – Adoption of the RA; – Continuation or delay of decision; – Denial of the application; or – Conditional approval of the RA with clear direction on suggested terms. The Board will also clearly indicate if the conditions are mandatory for approval or optional enhancements. If denied, the URA Board will not allow re-application to the URA for TIF unless there are significant changes from the original denied application.  An approved Redevelopment Agreement will remain valid for 12 months and will expire if not properly executed within that timeframe.  Until such time as a RA has been finalized and executed, no applicant will have any entitlement to TIF assistance.  Except as otherwise approved by the URA Board, TIF assistance will be on a reimbursement basis and only after the project valuation is verified by the Larimer 6 County Assessor’s Office and the Certificate of Occupancy (CO) or Letter of Completion (LOC) is issued at completion of construction. The funds will be paid upon actual costs, without interest, with verifiable receipts. 7 FORT COLLINS URBAN RENEWAL AUTHORITY POLICIES Revised October 2012March 2013 “The mission of the Urban Renewal Authority is to remedy blight, using Tax Increment Financing, to leverage private capital investment, and stimulate sustainable development and public improvement projects.” SECTION 1 – PURPOSE The purpose of this document is to provide guidance for the Fort Collins Urban Renewal Authority (URA) staff, recommending bodies, and URA Board (Board) in considering, reviewing and processing applications that seek to use Tax Increment Financing (TIF) for development activities within established TIF Districts. Policies are in accordance with Colorado Urban Renewal Law (C.R.S. § 31‐25‐101 et seq.) but have been adapted to further the City’s own vision and goals for the URA. The Board may, in its discretion, amend or waive sections of this document when determined necessary or appropriate. The fundamental purpose for application to the URA for TIF assistance is to facilitate desirable development/redevelopment projects within the URA TIF District that would not otherwise occur “but for” the assistance provided through TIF. The Board intends to provide the minimum amount of TIF assistance needed to make the project viable in order to preserve unencumbered TIF for District‐wide public improvements. The provision of financial assistance is at the sole discretion of the Board which shall, in its discretion, reject or approve projects on a case‐by‐case basis taking into account established policies, specific project criteria, and demands on City services versus potential public benefits received from the proposed project. Meeting policy guidelines and other criteria does not guarantee the award of TIF assistance. Furthermore, approval or denial of one project is not intended to set a precedent for approval or denial of any other project. SECTION 2 ‐ OBJECTIVES The URA was established to accomplish the following objectives:  Eliminate blight.  Improve public infrastructure (streets, storm drainage, sewer, utilities, etc.) in areas where deficiencies exist.  Remove impediments to desired development, e.g., lack of infrastructure, environmental contamination, presence of floodplaindrainage/storm water deficiencies, and/or unsuitable soils.  Retain, expand or attract businesses for the purpose of improving the City’s economic base as demonstrated by projects that retain jobs, create primary jobs, increase the manufacturing base, etc.  Create destination locations, including mixed‐use projects, which will capture additional revenue to the area. ATTACHMENT 2 1  Encourage development projects that enhance the streetscapes and pedestrian experience and improve the vitality of commercial corridors by adding interest and activity.  Provide a variety of quality housing choices.  Encourage development that is consistent with City Plan, subarea plans, and approved Urban Renewal Plans.  Promote energy and water efficiencies within buildings and developments.  Protect natural habitats and features. SECTION 3 – ELIGIBLE COSTS The following are eligible costs that may be considered for TIF assistance:  Removal of hazardous materials or conditions (sites where remediation or mitigation is required).  Site clearance or site acquisition.  Land assemblage.  Parking/structured parking for the public.  Infrastructure that is extraordinarily costly to the project and/or serves other development and redevelopment facilitating further improvements in the area.  Sustainable and renewable energy features that reduce the environmental impact of the project.  Public amenities such as parks, plazas, community gathering areas and streetscapes to enhance the aesthetics of the area.  Capital Improvement Projects (CIP) as identified by the City of Fort Collins.  Projects listed in Infrastructure Plans related to the Plan area, e.g., North College Infrastructure Funding Plan.  Other qualifying expenses as permitted by Colorado Revised Statutes (C.R.S.) § 31‐25‐101 et seq. SECTION 4 – EVALUATION CRITERIA The following evaluation criteria will be used to review applications seeking TIF. Since every project is unique, additional evaluation criteria may become necessary and will be determined individually based on the merits of the project. Construction Practices:  All URA projects that include new construction or major renovations of existing buildings (more than 50% of square footage affected) shall be required to meet the Energy Star label. Such projects shall be required to design buildings in such a manner as to be eligible for Designed to Earn the Energy Star (DEES) certification. Once buildings are completed, the energy use shall be monitored for 12 consecutive months to demonstrate the operating building earns an EPA rating of 75 or higher in Portfolio Manager and verification shall be received by a professional engineer or registered architect that the building meets indoor environmental standards qualifies to earn the ENERGY STAR label. Formatted: Bulleted + Level: 1 + Aligned at: 0.25" + Indent at: 0.5"  All URA projects that include renovations that affect less than 50% of existing square footage shall be required to meet the current energy code, except for the building envelope requirements, and energy use shall be monitored through the Energy Star program for 12‐consecutive months in an effort to raise energy use awareness.  All URA projects demonstrate that at least 50% of the waste materials by weight (excluding wastes containing lead, asbestos or other hazardous material) generated by a construction or demolition project be diverted from the landfill through waste management options, such as reuse or recycling. Financial feasibility:  TIF assistance will not be considered for projects that have the financial feasibility to proceed without TIF assistance, except when TIF assistance allows a project to conform with, or exceed identified objectives in City Plan.where exceptional circumstances warrant support for the project.  Individuals requesting TIF must demonstrate, to the satisfaction of the URA, sufficient equity investment in the project prior to seeking TIF. Equity is defined as cash or un‐ leveraged value in land or prepaid costs attributable to the project. Examples of equity may include personal cash, letter of credit, personal investment, awarded grant monies, etc.  Assistance will not be provided solely to increase the developer’s profit margin on the project. Prior to consideration of a TIF request, the URA will undertake a financial analysis of the project costs to ensure that the developer’s internal rate of return (IRR) is reasonable based on the characteristics of the project.  For projects that will generate more than $1 million in TIF or create a project that is more than 10,000 sq. ft. in size there may be an independent financial analysis. The independent analysis will be contracted for by the URA and the cost will be paid for by the applicant. Additionally, if the project is seeking more than 50% of the property tax increment generated from the project, or if the applicant is asking for requesting more than $150,000 in financial assistance, an independent financial analysis of the project may be required by the URA. Public Benefit:  A qualitative and/or quantitative analysis should be completed in order to identify the public benefits achieved by the project. Analysis of the benefits of the project will be measured against the expectations set in the relevant plans that may include, but not be limited by, City Plan (the City’s Comprehensive Plan), an Urban Renewal Plan, a community subarea plan, or an adopted policy, ordinance, or resolution of the City Council.  Public benefits that garner additional consideration by the URA Board include: - Affordable housing projects, using varying measures, that exceed the minimum City Land Use Code definition of an “affordable housing project”, with higher perceived public benefit resulting from greater levels of affordable housing offered. Formatted: Bulleted + Level: 1 + Aligned at: 0.25" + Indent at: 0.5" Formatted: Font: Bold Formatted: Font: Not Bold Formatted: Font: Italic - Projects that have local ownership, which is defined to mean any home location, business, or developer located within a 40 mile radius from the City of Fort Collins Growth Management boundary. - Projects that achieve or exceed LEED Silver certification. - Projects that include early childhood care and/or education centers. - Historic preservation and/or adaptive reuse of historic structures.  Projects that do not provide sufficient public benefits may, after review, be provided feedback and allowed to submit a revised application. Revisions may lead to approval or final denial of the URA applicant and may include, but are not limited to: - Greater developer contribution; - Reduced TIF participation; and/or - Redefinition of the scope of the project. Section 5 – Other General Policies  If substantial URA expense may be involved during screening, reviewing, and/or negotiating, a party requesting assistance from the URA may be asked to pay a deposit in order to fund URA staff or contractual work in advance of the URA incurring significant costs; furthermore, contractual commitments to fund appropriate work or other expenses may be required in advance of, or in connection with, a formal application or other request for assistance.  The applicant must be able to demonstrate to the Board’s satisfaction an ability to construct, operate, and maintain the proposed project based upon past experience, general reputation, and credit history.  TIF assistance for land/property purchase costs will not be provided in an amount exceeding the fair market value of the property. Fair market value will be determined by an independent appraiser hired by URA staff. The cost of the appraisal will be paid for by the applicant.  There will be no interest paid on any portion of the applicant’s reimbursable expenses.  TIF will not be used to retroactively reimburse projects or make payments to cover costs associated with any actions incurred by a development/redevelopment prior to execution of the Redevelopment Agreement, except for eligible hard costs associated with public improvements required of the project as approved by the Board. 1U.S. Department of Energy Energy Information Agency’s 2003 Commercial Buildings Energy Consumption Survey (CBECS), a national sample survey that collects information on the stock of U.S. commercial buildings, their energy-related building characteristics, and their energy consumption and expenditures. Designed to Earn the ENERGY STAR is the U.S. Environmental Protection Agency’s designation for energy-efficient design projects that reduce greenhouse gas emissions. TARGET FINDER: SET GOALS FOR ENERGY SAVINGS ACHIEVE DESIGNED TO EARN THE ENERGY STAR® DESIGNING ENERGY-EFFICIENT BUILDINGS Generating the energy to power America’s commercial and industrial buildings causes almost half of our nation’s greenhouse gas emissions. You can help the U.S. Environmental Protection Agency (EPA) by designing buildings to use less fossil fuel energy—the first step in committing to energy and cost savings over the life of your building. SET YOUR ENERGY TARGET Architects, engineers, and building owners who want to set energy targets to achieve Designed to Earn the ENERGY STAR and meet government and industry goals can use Target Finder. It provides easy to understand energy use targets based on actual building energy consumption data1 for more than a dozen building types in the United States. EPA’s ENERGY STAR energy performance scale assigns a score between 1 and 100 for the corresponding energy use intensity for the specified project. RATE YOUR DESIGN You can use Target Finder throughout the design process to rate estimated energy use for design alternatives and trade-offs. The EPA score is an “apples-to-apples” comparison of your project’s estimated energy use to that of similar U.S. building types. The tool adjusts for primary drivers of energy such as building size, climate, operating hours, number of occupants, and computers. It also provides a rating for projects using Building Information Modeling through a Web-based energy analysis service. RECEIVE EPA RECOGNITION Architects use Target Finder to receive Designed to Earn the ENERGY STAR certification for projects and to participate in the ENERGY STAR Challenge. EPA recognizes these architecture firms and design projects in publications, on the ENERGY STAR website, and at events. The EPA energy performance rating uses a 1-100 scale and makes it easy to set energy targets and evaluate energy use intent. Lower energy use yields a higher performance rating. A 75 or higher design score achieves the ENERGY STAR. 100 EPA ENERGY PERFOMANCE RATING 75 Site Energy 1 50 Low High Pre-Design: Set Energy Use Goal Complete all required fields, indicated by a red asterisk (*), and Target Finder will calculate the energy use target for the project. 1. FACILITY INFORMATION Enter the ZIP code where the project will be built. Target Finder selects the appropriate climate data and determines the energy fuel mix (electricity, NG, etc.) typical of the specified location. The tool can be used only for projects in U.S. cities, states, and territories. 2. FACILITY CHARACTERISTICS Select the applicable space type2 from the drop down menu. Provide requested attribute information for the design project. 3. TARGET RATING Choose “Target Rating” or “Energy Reduction Target,” and the tool provides the total annual energy use for the selected target. An EPA score of 75 or higher achieves ENERGY STAR. Select “View Results” to see Target Energy Performance Results Schematic and Design Development As the design develops, enter results from energy analysis calculations. 4. DESIGN ENERGY Enter your project’s estimated results for the energy sources, annual energy usage, and costs. Target Finder will provide an ENERGY STAR score for the design project’s estimated energy. Select “View Results” to see Target Energy Performance Results. SET ENERGY USE TARGETS AND RATE YOUR DESIGN Use Target Finder throughout the design process from pre-design to establish design target; and on through design development to determine if energy efficiency goals are being achieved on the project. 2Performance ratings are available for about 60 percent of the commercial building square footage across the United States. If your building is a space type other than those listed in Target Finder, you can compare its energy use with the national median source and site energy use for many additional spaces using the 2003 CBECS National Median Source Energy Use and Performance Comparisons. HELP BUTTON The HELP section includes space type definitions, default values, and information about using the tool. APPLY FOR DESIGNED TO EARN THE ENERGY STAR Design projects that score 75 or higher are eligible for Designed to Earn the ENERGY STAR certification. Click on the APPLY button and complete the Statement of Energy Design Intent. THE DESIGN RATING In the example, the office building design score is 92, and the project achieves an estimated 48% reduction in energy use compared to the median building. Use this comparison to determine which design strategies will best achieve your goal for energy efficiency. EDIT BUTTON Use the EDIT button located at the top of each table to change your entries. (Note: Using the “Back” button on your browser may delete your data.) Note: An incomplete energy use profile could result in a high but inaccurate rating. Total annual estimated energy use should include plug, process, and all non-regulated loads; equipment loads specified on drawings; and all energy sources.4 TARGET FINDER RESULTS SCREEN Target Finder displays the annual source3 and site energy results for the Design, Target, and Median Building, which provide a reference for comparing energy design strategies and alternatives for achieving your energy use goal. 3Source energy represents the total amount of raw fuel that is required to operate the building. It incorporates all transmission, delivery, and production losses, thereby enabling a complete assessment of energy efficiency in a building. 4The EPA energy performance rating used in Target Finder is derived from fuel consumption data of existing commercial buildings, which include the total energy use associated with the building. Therefore, design energy use should include all fuel sources and total estimated energy use for the building design. Gaps in energy analysis should be addressed in order for the rating to be a useful indicator of the design’s energy intent. APPLY for “Designed to Earn the ENERGY STAR” ENERGY STAR COMMERCIAL BUILDING DESIGN ENERGY STAR is a U.S. Environmental Protection Agency program helping businesses and individuals fight global warming through superior energy efficiency. COMMERCIAL BUILDING DESIGN ON THE WEB Find links to A/E projects and firms that are using Target Finder and participating in the ENERGY STAR Challenge, while designing buildings that achieve the superior energy efficiency criteria set by EPA. DESIGNED TO EARN THE ENERGY STAR GUIDE Use the online Designed to Earn the ENERGY STAR Guide as a start-to-finish framework for architects and owners to show commitment to energy-efficient building design. OMB No.2060-0347 STATEMENT OF ENERGY DESIGN INTENT March 6, 2012 FACILITY INFORMATION & CHARACTERISTICS Facility Name: Capital Towers Location: Washington, DC 20005 United States Design Energy (kBtu) 1 Electricity - Grid Purchase 2,000,000 Space Type: Total Floor Area: Natural Gas 900,000 Office 50,000 sq. ft. Total Gross Floor Area: 50,000 Sq. Ft. RESULTS FOR ESTIMATED ENERGY USE DESIGN MEDIAN BUILDING ESTIMATED SAVINGS EPA Energy Performance Rating (1-100)1 92 50 42 Percent Energy Reduction (%)2 48 0 N/A Site Energy Use Intensity (kBtu/sf/yr) 58 112 54 Source Energy Use Intensity (kBtu/sf/yr) 152 294 142 Total Annual Site Energy Use (kBtu/yr) 2,900,000 5,596,414 2,696,414 Total Annual Source Energy Use (kBtu/yr) 7,622,300 14,709,499 7,087,199 Total Annual Energy Costs ($) $ 92,564 $ 178,630 $ 86,066 Pollution Emissions (metric tons/yr) 3 CO2-eq 331 639 308 CONTACT INFORMATION Building Owner/Company Name Address City, State, Zip Code Contact Name Phone Email Professional Verification (Licensed Architect/Engineer) Prepared By Firm Name Address City, State, Zip Code Phone Email Architect of Record Firm (if different from verifier) Name Firm Name Phone Email Professional Stamp Signature & Date This project was specified and executed to achieve Designed to Earn the ENERGY STAR certification. ATTACHMENT 4 1 1 Policy Amendments URA Board Meeting March 26, 2013 2 AGENDA • Green Building Construction Background • Energy Efficiency Requirements • Deconstruction/Recycling Requirements • Administrative Procedures Approval Process • Minor Language Amendments ATTACHMENT 5 2 3 GREEN CONSTRUCTION BACKGROUND • LEED Silver requirement • Integrated Design Assistance Program (IDAP) • Construction Waste Management Plan 4 Energy Efficiency Requirements • EPAs Energy Star Program • Target Finder system (online tool) during design phase • Set energy targets and receive energy performance score (1-100) • 75+ are eligible for Designed to Earn the Energy Star certification • 35% better than comparable buildings and represents the top 25% of existing buildings 3 5 Energy Efficiency Requirements • Designed to Earn the Energy Star certification • Energy Star label • Close the loop between design and actual performance • Monitor energy use for 12 consecutive months 6 Energy Efficiency Requirements • Designed to Earn the Energy Star versus Energy Star label Source: EnergyStar.org 4 7 Energy Efficiency Requirements Applicability: New buildings and major renovations (more than 50% of square footage affected) • Energy Star Label Minor Renovations (Less 50% square footage affected) • Current Energy Code (except building envelope) • Monitor Energy Use for 12 months 8 Deconstruction/Recycling • City of Fort Collins goal: Divert 50% of the community waste from landfills • Demolition resulting from redevelopment is major contributor to landfill 5 9 Deconstruction/Recycling Deconstruction is the process of systematically dismantling a structure in an environmentally, economically and socially responsible manner, aiming to maximize the recovery of materials for reuse and recycling. Non-structural & Structural 10 Deconstruction/Recycling Greater expense and more time Cost reduction: • Reduced disposal cost • Material sales • Tax benefits 6 11 Deconstruction/Recycling URA funded projects demonstrate that at least 50% of the waste materials by weight (excluding wastes containing lead, asbestos or other hazardous material) generated by a construction or demolition project be diverted from the landfill through waste management options, such as reuse or recycling. 12 Administrative Procedures Approval • Allows staff flexibility to implement policies • Respond quickly to issues Delegate the authority to approve Administrative Procedures with the Executive Director 7 13 October Worksession Amendments Section 2- Objectives • Presence of Floodplain language Section 4 – Evaluation Criteria • Financial Feasibility of Projects language Section 4 – Public Benefit • Affordable Housing as Public Benefit language 14 Questions? RESOLUTION NO. 053 OF THE BOARD OF COMMISSIONERS OF THE FORT COLLINS URBAN RENEWAL AUTHORITY ADOPTING UPDATED POLICIES FOR THE FORT COLLINS URBAN RENEWAL AUTHORITY WHEREAS, on October 23, 2012, the Board of Commissioners of the Fort Collins Urban Renewal Authority (the “Board”) adopted Resolution No. 45, approving and adopting new and extensive policies and procedures in order to better describe the priorities and expectations for the processing of applications for financial assistance from the Urban Renewal Authority (the “Authority”); and WHEREAS, on October 23, 2012, the Board deferred any decision regarding requiring green building practices and/or sustainability measures to allow additional time for research and policy formation; and WHEREAS, in response to Board input, Authority staff initiated review of Authority policies, as well as City of Fort Collins building code requirements to ensure consistency between City policies and City Code requirements as they relate to green building practices and energy efficiency; and WHEREAS, in reviewing the Authority policies and procedures, Authority staff has recommended certain amendments that require Authority projects to be designed and constructed in such a manner that achieves the Environmental Protection Agency’s Energy Star label, as well as to achieve a certain level of recycling/deconstruction; and WHEREAS, in reviewing the Authority policies and procedures, Authority staff has recommended certain amendments that delegate the authority to approve Administrative Procedures with the Authority Executive Director; and WHEREAS, in response to Board input during the October 23, 2012, Board hearing, as well as the February 28, 2013, Board Work Session, Authority staff has recommended certain minor language changes in the policy to clarify the policy intent. NOW THEREFORE, BE IT RESOLVED BY THE BOARD OF COMMISSIONERS OF THE FORT COLLINS URBAN RENEWAL AUTHORITY as follows: Section 1. That the Board hereby finds and determines that the Fort Collins Renewal Authority Policies attached hereto as Exhibit “A” and incorporated herein by this reference accurately reflect the Board’s expectations to require Authority projects to be designed and constructed in such a manner that achieves the Environmental Protection Agency’s Energy Star label, as well as to achieve a certain level of recycling/deconstruction. Section 2. That the Board hereby authorizes the Authority Executive Director to approve Administrative Procedures for the implementation of the Authority’s Policies. Section 3. That the Board hereby adopts the Fort Collins Urban Renewal Authority Policies attached hereto as Exhibit “A” and incorporated herein by this reference, to replace and supersede the Authority Policies previously adopted on October 23, 2012. Passed and adopted at a regular meeting of the Board of Commissioners of the Fort Collins Urban Renewal Authority this 27th day of March A.D. 2013. Chairperson ATTEST: Secretary FORT COLLINS URBAN RENEWAL AUTHORITY POLICIES Revised March 2013 “The mission of the Urban Renewal Authority is to remedy blight, using Tax Increment Financing, to leverage private capital investment, and stimulate sustainable development and public improvement projects.” SECTION 1 – PURPOSE The purpose of this document is to provide guidance for the Fort Collins Urban Renewal Authority (URA) staff, recommending bodies, and URA Board (Board) in considering, reviewing and processing applications that seek to use Tax Increment Financing (TIF) for development activities within established TIF Districts. Policies are in accordance with Colorado Urban Renewal Law (C.R.S. § 31‐25‐101 et seq.) but have been adapted to further the City’s own vision and goals for the URA. The Board may, in its discretion, amend or waive sections of this document when determined necessary or appropriate. The fundamental purpose for application to the URA for TIF assistance is to facilitate desirable development/redevelopment projects within the URA TIF District that would not otherwise occur “but for” the assistance provided through TIF. The Board intends to provide the minimum amount of TIF assistance needed to make the project viable in order to preserve unencumbered TIF for District‐wide public improvements. The provision of financial assistance is at the sole discretion of the Board which shall, in its discretion, reject or approve projects on a case‐by‐case basis taking into account established policies, specific project criteria, and demands on City services versus potential public benefits received from the proposed project. Meeting policy guidelines and other criteria does not guarantee the award of TIF assistance. Furthermore, approval or denial of one project is not intended to set a precedent for approval or denial of any other project. SECTION 2 ‐ OBJECTIVES The URA was established to accomplish the following objectives:  Eliminate blight.  Improve public infrastructure (streets, storm drainage, sewer, utilities, etc.) in areas where deficiencies exist.  Remove impediments to desired development, e.g., lack of infrastructure, environmental contamination, drainage/storm water deficiencies, and/or unsuitable soils.  Retain, expand or attract businesses for the purpose of improving the City’s economic base as demonstrated by projects that retain jobs, create primary jobs, increase the manufacturing base, etc.  Create destination locations, including mixed‐use projects, which will capture additional revenue to the area. EXHIBIT A 1  Encourage development projects that enhance the streetscapes and pedestrian experience and improve the vitality of commercial corridors by adding interest and activity.  Provide a variety of quality housing choices.  Encourage development that is consistent with City Plan, subarea plans, and approved Urban Renewal Plans.  Promote energy and water efficiencies within buildings and developments.  Protect natural habitats and features. SECTION 3 – ELIGIBLE COSTS The following are eligible costs that may be considered for TIF assistance:  Removal of hazardous materials or conditions (sites where remediation or mitigation is required).  Site clearance or site acquisition.  Land assemblage.  Parking/structured parking for the public.  Infrastructure that is extraordinarily costly to the project and/or serves other development and redevelopment facilitating further improvements in the area.  Sustainable and renewable energy features that reduce the environmental impact of the project.  Public amenities such as parks, plazas, community gathering areas and streetscapes to enhance the aesthetics of the area.  Capital Improvement Projects (CIP) as identified by the City of Fort Collins.  Projects listed in Infrastructure Plans related to the Plan area, e.g., North College Infrastructure Funding Plan.  Other qualifying expenses as permitted by Colorado Revised Statutes (C.R.S.) § 31‐25‐101 et seq. SECTION 4 – EVALUATION CRITERIA The following evaluation criteria will be used to review applications seeking TIF. Since every project is unique, additional evaluation criteria may become necessary and will be determined individually based on the merits of the project. Construction Practices:  All URA projects that include new construction or major renovations of existing buildings (more than 50% of square footage affected) shall be required to meet the Energy Star label. Such projects shall be required to design buildings in such a manner as to be eligible for Designed to Earn the Energy Star (DEES) certification. Once buildings are completed, the energy use shall be monitored for 12 consecutive months to demonstrate the operating building earns an EPA rating of 75 or higher in Portfolio Manager and verification shall be received by a professional engineer or registered architect that the building meets indoor environmental standards and qualifies to earn the ENERGY STAR label.  All URA projects that include renovations that affect less than 50% of existing square footage shall be required to meet the current energy code, except for the building envelope requirements, and energy use shall be monitored through the Energy Star program for 12‐consecutive months in an effort to raise energy use awareness.  All URA projects shall demonstrate that at least 50% of the waste materials by weight (excluding wastes containing lead, asbestos or other hazardous material) generated by a construction or demolition project be diverted from the landfill through waste management options, such as reuse or recycling. Financial feasibility:  TIF assistance will not be considered for projects that have the financial feasibility to proceed without TIF assistance, except when TIF assistance allows a project to conform with, or exceed identified objectives in City Plan..  Individuals requesting TIF must demonstrate, to the satisfaction of the URA, sufficient equity investment in the project prior to seeking TIF. Equity is defined as cash or un‐ leveraged value in land or prepaid costs attributable to the project. Examples of equity may include personal cash, letter of credit, personal investment, awarded grant monies, etc.  Assistance will not be provided solely to increase the developer’s profit margin on the project. Prior to consideration of a TIF request, the URA will undertake a financial analysis of the project costs to ensure that the developer’s internal rate of return (IRR) is reasonable based on the characteristics of the project.  For projects that will generate more than $1 million in TIF or create a project that is more than 10,000 sq. ft. in size there may be an independent financial analysis. The independent analysis will be contracted for by the URA and the cost will be paid for by the applicant. Additionally, if the project is seeking more than 50% of the property tax increment generated from the project, or if the applicant is asking for requesting more than $150,000 in financial assistance, an independent financial analysis of the project may be required by the URA. Public Benefit:  A qualitative and/or quantitative analysis should be completed in order to identify the public benefits achieved by the project. Analysis of the benefits of the project will be measured against the expectations set in the relevant plans that may include, but not be limited by, City Plan (the City’s Comprehensive Plan), an Urban Renewal Plan, a community subarea plan, or an adopted policy, ordinance, or resolution of the City Council.  Public benefits that garner additional consideration by the URA Board include: - Affordable housing projects, using varying measures, that exceed the minimum City Land Use Code definition of an “affordable housing project”, with higher perceived public benefit resulting from greater levels of affordable housing offered. - Projects that have local ownership, which is defined to mean any home location, business, or developer located within a 40 mile radius from the City of Fort Collins Growth Management boundary. - Projects that achieve or exceed LEED Silver certification. - Projects that include early childhood care and/or education centers. - Historic preservation and/or adaptive reuse of historic structures.  Projects that do not provide sufficient public benefits may, after review, be provided feedback and allowed to submit a revised application. Revisions may lead to approval or final denial of the URA applicant and may include, but are not limited to: - Greater developer contribution; - Reduced TIF participation; and/or - Redefinition of the scope of the project. Section 5 – Other General Policies  If substantial URA expense may be involved during screening, reviewing, and/or negotiating, a party requesting assistance from the URA may be asked to pay a deposit in order to fund URA staff or contractual work in advance of the URA incurring significant costs; furthermore, contractual commitments to fund appropriate work or other expenses may be required in advance of, or in connection with, a formal application or other request for assistance.  The applicant must be able to demonstrate to the Board’s satisfaction an ability to construct, operate, and maintain the proposed project based upon past experience, general reputation, and credit history.  TIF assistance for land/property purchase costs will not be provided in an amount exceeding the fair market value of the property. Fair market value will be determined by an independent appraiser hired by URA staff. The cost of the appraisal will be paid for by the applicant.  There will be no interest paid on any portion of the applicant’s reimbursable expenses.  TIF will not be used to retroactively reimburse projects or make payments to cover costs associated with any actions incurred by a development/redevelopment prior to execution of the Redevelopment Agreement, except for eligible hard costs associated with public improvements required of the project as approved by the Board. 1 Target Finder determines an EPA energy performance rating by comparing estimated total annual source energy use to source energy use of an existing building from CBECS database (DOE-EIA). Note: An incomplete energy design profile could result in a high but inaccurate performance score for your project. 2 "Percent Energy Reduction" is the percent reduction from the median energy consumption of a similar building and the equivalent of a Rating of 50. 3 The amount of carbon dioxide equivalent gases emitted from the facility’s estimated energy consumption. This document was generated from Target Finder, an EPA tool located on the ENERGY STAR Web site, www.energystar.gov. Page 1 of 2 OMB No.2060-0347 STATEMENT OF ENERGY DESIGN INTENT March 6, 2012 CILITY INFORMATION & CHARACTERISTICS acility Name: Capital Towers Location: Washington, DC 20005 United States Design Energy (kBtu) 1 Electricity - Grid Purchase 2,000,000 Space Type: Total Floor Area: Natural Gas 900,000 Office 50,000 sq. ft. Total Gross Floor Area: 50,000 Sq. Ft. ESULTS FOR ESTIMATED ENERGY USE DESIGN MEDIAN BUILDING ESTIMATED SAVINGS EPA Energy Performance Rating (1-100)1 92 50 42 Percent Energy Reduction (%)2 48 0 N/A Site Energy Use Intensity (kBtu/sf/yr) 58 112 54 Source Energy Use Intensity (kBtu/sf/yr) 152 294 142 Total Annual Site Energy Use (kBtu/yr) 2,900,000 5,596,414 2,696,414 Total Annual Source Energy Use (kBtu/yr) 7,622,300 14,709,499 7,087,199 Total Annual Energy Costs ($) $ 92,564 $ 178,630 $ 86,066 ollution Emissions (metric tons/yr) 3 CO2-eq 331 639 308 ONTACT INFORMATION uilding Owner/Company Name ddress ty, State, Zip Code ontact Name hone Email ofessional Verification (Licensed Architect/Engineer) epared By rm Name ddress ty, State, Zip Code hone mail chitect of Record Firm (if different from verifier) ame rm Name hone mail Professional Stamp Signature & Date This project was specified and executed to achieve Designed to Earn the ENERGY STAR certification. arget Finder determines an EPA energy performance rating by comparing estimated total annual source energy use to source energy use of an existing ding from CBECS database (DOE-EIA). Note: An incomplete energy design profile could result in a high but inaccurate performance score for your project. Percent Energy Reduction" is the percent reduction from the median energy consumption of a similar building and the equivalent of a Rating of 50. he amount of carbon dioxide equivalent gases emitted from the facility’s estimated energy consumption. STATEMENT OF ENERGY DESIGN INTENT The Statement of Energy Design Intent (SEDI) summarizes all inputs and results data from Target Finder. The SEDI can be included in Contract Documents and Requests for Proposal to help ensure that your intended energy goal for the design project is clearly articulated to the owner and design team. Use the SEDI to apply for Designed to Earn the ENERGY STAR. WEB TRAINING Attend no-cost online presentations about Target Finder and earn AIA/CES credits. CONTACT ENERGY STAR www.energystar.gov/commercialbuildingdesign Hotline: 1.888.STAR.YES (1.888.782.7937) E-mail: spp@energystar.gov Karen P. Butler U.S. EPA—ENERGY STAR Commercial Building Design ENERGY COSTS SAVINGS The SEDI shows an annual savings of $86,066 compared to the median building. The anticipated cost savings could be used to invest in more aggressive energy efficiency measures. RESOURCES Annual Energy Use Intensity (kBtu / ft2 / year) Designed to Earn the ENERGY STAR ATTACHMENT 3