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(1) Development Fees (54 units/ phase 1 only)
<br />Parks-$126,290, Trails-$39,150, Water-$90,612, Sewer-$65,664, Storm-$24,786. Does not include SAC/WAC or
<br />building permit fees. This is an informal estimation, changes will occur.
<br />(2) Tax Base (54 units)
<br />40-60K annually in total property taxes. This project is located within TIF District 14, which is a benefit to the City,
<br />as it will generate dollars for TIF 14, which can be used for various public improvements contemplated for The
<br />COR. NOTE: the city is able to pull about 60% of total property taxes for TIF. This is an informal estimation,
<br />changes will occur.
<br />(3) Workforce Housing
<br />Over the past two years, staff has received strong and consistent feedback from local employers help is needed to
<br />address shortages in workforce. Anecdotally, local businesses have suggested the City consider affordable housing
<br />options to help retain and attract workforce.
<br />(4) City Transaction Costs
<br />In order to close this transaction, the City will need to pay CBRE a commission (5% on $300K or $15,000).
<br />Additionally, the City will need to pay 1/2 of closing costs, state DEED tax, and the cost for a title work (estimated
<br />between $2,000-$4,000). NOTE: these transaction costs are all consistent with past projects and in compliance with
<br />city policies.
<br />(5) Concentration of Workforce Housing Projects
<br />When considering the Seasons of Ramsey townhome project (2013), the Common Bond apartment project (2016),
<br />and now potential Aeon apartment project (2017 or 2018), it could be perceived that a concentration of workforce
<br />housing may be occurring in The COR. Staff has no concerns with workforce housing in Ramsey, as a whole.
<br />However, because the City is the property owner in this case, discretion exists for selecting buyers/ users. The
<br />policy question here is not IF the community generally supports workforce housing, but when is workforce housing
<br />becoming too concentrated in one geographic area (i.e. The COR).
<br />(6) Land Sale Proceeds
<br />Staff estimates roughly $280K of land proceeds from this transaction, which will help pay down debt associated
<br />with The COR.
<br />(7) Retail/ Restaurants
<br />Although this project doesn't deliver much desired and anticipated restaurants/ retail to The COR, it does move
<br />Ramsey closer to this goal. Staff is repeatedly told by prospects, developers, and brokers, the two biggest things we
<br />can do (control) to get retail and restaurants in Ramsey, is continue improving U.S. Highway 10, and continue
<br />improving demographics (i.e. butts -in -seats). As our policy makers well know, Ramsey's experienced positive
<br />momentum in both arenas over the past two years.
<br />(8) Term of Agreement
<br />This agreement, and the proposed funding structure, does require a longer than normal due -diligence period (i.e.
<br />closing is far out). There is a chance this agreement never closes; and in the meantime, the city passes up on other
<br />prospects. NOTE: Aeon desires to construct their project in 2017. However, 2018 construction would not be
<br />unrealistic.
<br />STAFF NOTE
<br />The deal structure proposed by Aeon includes a Metropolitan LCDA Grant. LCDA grants require cities to sponsor
<br />applications (technically be the applicant). Additionally, LCDA grants require two application rounds (one
<br />conceptual/ preliminary, and one formal). The preliminary/ conceptual application does not cost the City anything,
<br />nor does it commit the City to a project. The deadline for 2016 LCDA grants, preliminary/ conceptual applications,
<br />was on 05/02/2016. Staff did work with Aeon to get a conceptual application into the Metropolitan Council. If the
<br />City decides not to move forward with this project, staff will pull said application
<br />Funding Source:
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