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2022-2044 RESOLUTION NO. 2022-2044 RESOLUTION APPROVING AN AMENDMENT TO THE PROJECT PLAN OF TAX INCREMENTAL DISTRICT NO. 32, CITY OF JANESVILLE, WISCONSIN WHEREAS, the City of Janesville (the "City") has determined that use of Tax Incremental Financing is required to promote development and redevelopment within the City; and WHEREAS, Tax Incremental District No. 32 (the"District")was created by the City on September 22, 2008, as a mixed-use district; and WHEREAS, the City now desires to amend the Project Plan of the District (the "Amendment") in accordance with the provisions of Wisconsin Statutes Section 66.1105 (the"Tax Increment Law"); and WHEREAS, such Amendment will: a. Amend the categories, locations, or costs of project costs to be made as permitted under Wisconsin Statutes Section 66.1005(4)(h)1. b. Allow excess revenue to be transferred to Tax Incremental District No. 28 and increase the amount of excess review to be transferred to Tax Incremental District No. 36 as permitted under Wisconsin Statutes Section 66.1105(6)(f)1; and WHEREAS, an amended Project Plan for the District has been prepared that includes: a. A statement listing of the kind, number and location of all proposed public works or improvements within the District, or to the extent provided in Wisconsin Statutes Sections 66.1105(2)(f)1.k. and 66.1105(2)(f)1.n., outside of the District; b. An economic feasibility study; c. A detailed list of estimated project costs; d. A description of the methods of financing all estimated project costs and the time when the related costs or monetary obligations are to be incurred; e. A map showing existing uses and conditions of real property in the District; f. A map showing proposed improvements and uses in the District; g. Proposed changes of zoning ordinances, master plan, map, building codes and City ordinances; h. A list of estimated non-project costs; i. A statement of the proposed plan for relocation of any persons to be displaced; j. A statement indicating how the amendment of the District promotes the orderly development of the City; k. An opinion of the City Attorney or of an attorney retained by the City advising that the Project Plan is complete and complies with Wisconsin Statutes Section 66.1105(4)(f).; and WHEREAS, prior to its publication, a copy of the notice of public hearing was sent to the chief executive officers of Rock County, the Janesville School District, and the Blackhawk Technical College District, and any other entities having the power to levy taxes on property located within the District, in accordance with the procedures specified in the Tax Increment Law; and WHEREAS, in accordance with the procedures specified in the Tax Increment Law, the Plan Commission, on September 6, 2022, held a public hearing concerning the proposed amendment City of Janesville Wisconsin TID No. 32 Amendment Council Resolution to the Project Plan of the District, providing interested parties a reasonable opportunity to express their views thereon; and WHEREAS, after said public hearing, the Plan Commission adopted the Project Plan and recommended to the Common Council that it amend the Project Plan. NOW, THEREFORE, BE IT RESOLVED by the Common Council of the City of Janesville that: 1. The boundaries of the District named "Tax Incremental District No. 32, City of Janesville" remain unchanged. 2. That this Amendment is effective as of the date of adoption of this resolution. 3. The Common Council finds and declares that: (a) The improvement of such area is likely to enhance significantly the value of substantially all of the other real property in the District. (b) The City estimates that less than 35% of the territory within the District will be devoted to retail business at the end of the District's maximum expenditure period, pursuant to Wisconsin Statutes Section 66.1105(5)(b). (c) Prior, and any remaining project costs to be incurred have promoted or will promote mixed- use development, consistent with the purpose for which the District was created. (d) Under the amended Project Plan, $350,000 in excess revenue will be transferred to Tax Incremental District No. 28 and the amount to be transferred to Tax Incremental District No. 36 will be increased from $10,000,000 to $12,000,000. (e) The District, Tax Incremental District No. 28, and Tax Incremental District No. 36 lie within the same overlapping taxing jurisdictions. (f) The District has sufficient revenue to pay for all current Project Costs and has sufficient excess revenue to pay for eligible project costs of Tax Incremental District No. 28 and Tax Incremental District No. 36. (g) Tax Incremental District No. 28 is a blighted area district, and Tax Incremental District No. 36 is a district in need of rehabilitation or conservation, which qualifies them as eligible recipients of excess revenue. 4. The Project Plan for "Tax Incremental District No. 32, City of Janesville" (see Exhibit A), as amended, is approved, and the City further finds the Project Plan is feasible and in conformity with the master plan of the City. City of Janesville Wisconsin TID No. 32 Amendment Council Resolution ADOPTED: September 26, 2022 Motion by: Jackson Second by: Benson APPROVED: a Councilmember Aye Nay Pass Absent / Benson X Mark . reitag, City Manager Burdick X Jackson X ATTEST: Marklein X Marshick X i rPI// Miller X Lorena Rae Stottler, City Clerk-Treasurer Williams X APPROVED AS TO FORM: &1� /�� Y i Wald Klimczyk, City Attorney Proposed by: Economic Development Office Prepared by: Economic Development Office • • • qr r , , " ' EXHIBIT A - PROJECT PLAN [DISTRIBUTED SEPARATELY] September 6, 2022 PROJECT PLAN AMENDMENT ':-...... l t Y of Janesville, Wisconsin Tax Incremental District No. 32 EHLERS ,, - „ BLIC FIN/{ . ,ADVISORS Prepared by: Ehlers N21W23350 Ridgeview Parkway West, Suite 100 Waukesha, WI 53188 BUILDING COMMUNITIES. IT'S WHAT WE DO. KEY DATES Organizational Joint Review Board Meeting Held: August. 15, 2022 Public Hearing Held: September 6, 2022 Approval by Plan Commission: September 6, 2022 Adoption by Common Council: September 26, 2022 Approval by the Joint Review Board: October 3, 2022 TABLE OF CONTENTS Executive Summary 3 Map of Current District Boundary 7 Map Showing Existing Uses and Conditions 9 Equalized Value Test 9 Statement Listing the Kind, Number and Location of All Proposed Public Works or Improvements Within the District 9 Map Showing Proposed Improvements and Uses 16 Detailed List of Estimated Project Costs 17 Economic Feasibility Study, Description of the Methods of Financing Estimated Project Costs and the Time When Related Costs or Monetary Obligations are to be Incurred 18 Annexed Property 23 Estimate of Property to be Devoted to Retail Business 23 Proposed Changes of Zoning Ordinances, Master Plan, Map, Building Codes and City Ordinances 23 Statement of the Proposed Method for the Relocation of any Persons to be Displaced 24 How Amendment of the Tax Incremental District Promotes the Orderly Development of the City 24 List of Estimated Non-Project Costs 25 Legal Opinion Advising Whether the Plan is Complete and Complies with Wis. Stat § 66.1105(4)(f) 26 Calculation of the Share of Projected Tax Increments Estimated to be Paid by the Owners of Property in the Overlying Taxing Jurisdictions 29 Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 12 SECTION 1: Executive Summary DESCRIPTION OF DISTRICT Tax Incremental District ("TID") No. 32 ("District") is a Mixed-Use District created on September 22, 2008, to stimulate continued mixed use and industrial development along N. Wright Road, Enterprise Drive and Racine Street. The District's specific objectives as set forth in its original Project Plan were to: • Promote industry retention and expansion through the continued development of an existing industrial area, thereby retaining jobs and increasing tax base. • Provide appropriate financial incentives to encourage industrial expansion. • Improve the municipal transportation and utility infrastructure to accommodate new mixed-use development in this emerging area of town. • Reduce the financial risk to the taxpayer by timing the implementation of the Project Plan with the creation of additional property value through industry expansions and negotiating development agreements with tax guarantees for specific projects. • Generate sufficient new property tax increments associated with the development project. Originally consisting of 245 acres, the District's boundaries were amended on April 28, 2014 to add an additional 153 acres of developable land to the east. The District was further amended on July 8, 2019 to permit it to allocate excess revenue to Tax Incremental District No. 36. PURPOSE OF AMENDMENT The purpose of this amendment, referred to hereafter as the Plan, the Amendment, or the Plan Amendment, is to: • Amend the categories, locations, or costs of project costs to be made as permitted under Wis. Stat. § 66.1005(4)(h)1. As part of the Plan Amendment, the City is setting forth the estimated types, costs and timing of the remaining Project Costs it expects to make through the end of the District's expenditure period in 2023, and remaining payments to be made on obligations entered into or planned to be entered into prior to the end of the expenditure period. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 13 • Allow $350,000 in excess revenue to be transferred to Tax Incremental District No. 28 ("TID No. 28") and to increase the amount of excess revenue to be transferred to Tax Incremental District No. 36 (TID No. 36") (collectively, the "Recipient Districts") from $10,000,000 to $12,000,000 as permitted under Wis. Stat. § 66.1105(6)(f)1. The Plan Amendment meets the following criteria necessary to allow for the transfer of excess revenue: 1. The District and the Recipient Districts lie within the same overlapping taxing jurisdictions. 2. The District has enough revenue to pay for all current Project Costs and has enough excess revenue to pay for eligible project costs of the Recipient Districts. 3. TID No. 28 is a blighted area district, and TID No. 36 is a district in need of rehabilitation or conservation, which qualifies them as eligible recipients of excess revenue. ESTIMATED TOTAL PROJECT COST EXPENDITURES The current Plan provides for an estimated $24.23 million in expenditures ("Project Costs") to include $10 million to be transferred to TID No. 36. The City has made approximately $10.13 million in expenditures through December 31, 2021. Projected expenditures in 2022 and through the remaining life of the District, to include the transfer of excess revenue to the Recipient Districts, total to $19.85 million. These projected expenditures will cause total costs to exceed the current Plan estimate by $5.72 million. This Amendment provides the City authority to make the additional expenditures. Remaining costs to be incurred include approximately $8.2 million for development incentives, $350,000 to be allocated to TID No. 28, $11.25 million to be allocated to TID No. 36, and $48,200 for administrative expense. INCREMENTAL VALUATION As of January 1, 2022, incremental value of $150,938,900 has been created. The City projects that additional land and improvements value of approximately $38.12 million will be created in the District over the next three years representing completion of Phase II of The Glade apartments project, and construction of two to three additional buildings as part of planned Phase III. Creation of this additional value will result from the Project Costs that have been made, and which will be made, within the District. A table detailing assumptions as to the development timing and associated values is included in the Economic Feasibility Study located within this Plan. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 14 EXPECTED TERMINATION OF DISTRICT Based on the Economic Feasibility Study located within Section 9 of this Plan, the City anticipates that the District will generate sufficient tax increment to pay all Project Costs within 17 of its allowable 20 years. SUMMARY OF FINDINGS As required by Wis. Stat. § 66.1105, and as documented in this Plan and the exhibits contained and referenced herein, the following findings are made: 1. That "but for" the creation of this District, the development projected to occur as detailed in this Plan: 1) would not occur; or 2) would not occur in the manner, at the values, or within the timeframe desired by the City. The City's prior review of Phase I and Phase II of The Glade project indicated that project could not proceed without appropriate development incentives, and the City expects that will remain the case with respect to Phase III of that project. Regarding the planned transfers to the Recipient Districts, absent such transfers, those districts will be unable to recover all project costs required for the implementation of their respective project plans. 2. The economic benefits of the District, as measured by increased employment, business and personal income, and property value, are sufficient to compensate for the cost of the improvements. In making this determination, the City has considered that in addition to the incremental value expected to be created, the Project will result in creation of market rate multi-family housing to meet market demand, and provision of employment and commercial opportunities related to the construction and operation of the Project. Additionally, the transfers to the Recipient Districts are expected to produce additional economic benefits associated with the continued implementation of those district's project plans such as rehabilitation and conservation of property, elimination of blighted areas and provision of necessary public infrastructure improvements. 3. The benefits of the proposal outweigh the anticipated tax increments to be paid by the owners of property in the overlying taxing jurisdictions. As required by Wis. Stat. § 66.1105(4)(i)4., a calculation of the share of projected tax increments estimated to be paid by the owners of property in the overlying taxing jurisdictions has been prepared and can be found in this Plan. However, because the Project would not occur without the use of tax incremental financing, these tax increments would not be paid but for creation of the District. Accordingly, the City finds that the benefits expected to be realized as set forth in this Plan outweigh the value of the tax increments to be invested in the Project. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page I 5 4. The boundaries of the District are not being amended. 5. Improvements to be made in the District are likely to significantly enhance the value of substantially all of the other real property in the District. 6. The Plan for the District is feasible and is in conformity with the Master Plan of the City. 7. The City estimates that less than 35% of the territory within the District will be devoted to retail business at the end of the District's maximum expenditure period, pursuant to Wis. Stat. § 66.1105(5)(b). Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 16 SECTION 2: Map of Current District Boundary For reference, a map identifying the current boundaries of the District is included below. The District's boundaries are not being amended. Also included for reference on the following page is map depicting the location of the Recipient Districts. ' R9erAv 3 i cc c�,Q� g �Ti.7 ,rn p_L_____ l ''r - CTH MM ilt 6.40 .coy')„ f _ cn aiL7jr---," at ran Dr: mi. G I ci CTH O 4/STH 11 39 9 �� Town of Tax incremental District No. 32 (Donor District) Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 17 W Memorial Dr '' E Memorial Dr 0so / t, , r Va rn _ �. Nr J, r f,J a et 0 Fj / / ..J \ T.: A f rt. , I k •c /0,,/,/,/ ,,,./ , ` E-Centerway IIII el II 1 J /r``/ / // it �(, f � ic, ‘Sc f S f . r ` � \ � ,x i /r V f`r f? r / E \ / / J / . J. f ,- r 1 '',,, / ///. �t.fr r y y fff I / / 4, IV - ��,ij/r '` Jf rr // f / ' *2 7) .- )urt-St - , :„� /\' '; r� ,./' J, ♦ 1 f il \, ,j, / cs// ,„/ /let \\ ✓ te rr e 'Po , e 2 4 L r ,, sp,. ,,, „, , ,, ___,.,,„ ,,, , , , 4- , . ro * ..... , j�s Map Identifying Location of Tax Incremental Districts No. 28 and 36 (Recipient Districts) Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 18 SECTION 3: Map Showing Existing Uses and Conditions The District's boundaries are not being amended. The "Map Showing Existing Uses and Conditions" included within the District's amended Project Plan dated July 8, 2019 remains unchanged and is incorporated by reference as part of this P►an Amendment. SECTION 4: Equalized Value Test No territory will be added to the District. Demonstration of compliance with the equalized value test is not required for this Plan Amendment. SECTION 5: Statement Listing the Kind, Number and Location of All Proposed Public Works or Improvements Within the District Project Costs are any expenditure made, estimated to be made, or monetary obligation incurred or estimated to be incurred as outlined in this Plan. Project Costs will be diminished by any income, special assessments, or other revenues, including user fees or charges, other than tax increments, received or reasonably expected to be received in connection with the implementation of the Plan. If Project Costs incurred benefit territory outside the District, a proportionate share of the cost is not a Project Cost. Costs identified in this P►an are preliminary estimates made prior to design considerations and are subject to change after planning, design and construction is completed. With al► Project Costs, the costs of engineering, design, survey, inspection, materials, construction, restoring property to its original condition, apparatus necessary for public works, legal and other consultant fees, testing, environmental studies, permits, updating City ordinances and plans, judgments or claims for damages and other expenses are included as Project Costs. The "Statement Listing the Kind, Number and Location of Al► Proposed Public Works or Improvements Within the District" included in the District's amended Project Plan dated July 8, 2019 remains unchanged but is restated in this Section reflecting the types of projects that will, or may need to, be undertaken through the remaining expenditure period. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 19 Property, Right-of-Way, and Easement Acquisition Property Acquisition for Development To promote and facilitate development the City may acquire property within the District. The cost of property acquired, and any costs associated with the transaction, are eligible Project Costs. Following acquisition, other Project Costs within the categories detailed in this Section may be incurred to make the property suitable for development. Any revenue received by the City from the sale of property acquired pursuant to the execution of this Plan will be used to reduce the total project costs of the District. If total Project Costs incurred by the City to acquire property and make it suitable for development exceed the revenues or other consideration received from the sale or lease of that property, the net amount shall be considered "real property assembly costs" as defined in Wis. Stat. § 66.1105(2)(f)1.c., and subject to recovery as an eligible Project Cost. Acquisition of Rights-of-Way The City may need to acquire property to allow for installation of streets, driveways, sidewalks, utilities, stormwater management practices and other public infrastructure. Costs incurred by the City to identify, negotiate and acquire rights-of-way are eligible Project Costs. Acquisition of Easements The City may need to acquire temporary or permanent easements to allow for installation and maintenance of streets, driveways, sidewalks, utilities, stormwater management practices and other public infrastructure. Costs incurred by the City to identify, negotiate and acquire easement rights are eligible Project Costs. Relocation Costs If relocation expenses are incurred in conjunction with the acquisition of property, those expenses are eligible Project Costs. These costs may include but are not limited to preparation of a relocation plan; allocations of staff time; legal fees; publication of notices; obtaining appraisals; and payment of relocation benefits as required by Wis. Stat. Chapter 32 and Wis. Admin. Code ADM 92. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 110 Site Preparation Activities Environmental Audits and Remediation If it becomes necessary to evaluate any land or improvement within the District, any cost incurred by the City related to environmental audits, testing, and remediation are eligible Project Costs. Demolition To make sites suitable for development, the City may incur costs related to demolition and removal of structures or other land improvements, to include abandonment of wells or other existing utility services. Site Grading Land within the District may require grading to make it suitable for development, to provide access, and to control stormwater runoff. The City may need to remove and dispose of excess material or bring in fill material to provide for proper site elevations. Expenses incurred by the City for site grading are eligible Project Costs. Utilities Sanitary Sewer System Improvements To allow development to occur, the City may need to construct, alter, rebuild or expand sanitary sewer infrastructure within the District. Eligible Project Costs include, but are not limited to, construction, alteration, rebuilding or expansion of: collection mains; manholes and cleanouts; service laterals; force mains; interceptor sewers; pumping stations; lift stations; wastewater treatment facilities; and all related appurtenances. To the extent sanitary sewer projects undertaken within the District provide direct benefit to land outside of the District, the City will make an allocation of costs based on such benefit. Those costs corresponding to the benefit allocated to land within the District, and necessitated by the implementation of the Project Plan, are eligible Project Costs. Implementation of the Project Plan may also require that the City construct, alter, rebuild or expand sanitary sewer infrastructure located outside of the District. That portion of the costs of sanitary sewer system projects undertaken outside the District which are necessitated by the implementation of the Project Plan are eligible Project Costs. The improvements to the wastewater treatment facilities, although not within the 1/2 mile radius, is an eligible project cost under Wis. Stat. § 66.1105(2)(f)1 k. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 111 Water System Improvements To allow development to occur, the City may need to construct, alter, rebuild or expand water system infrastructure within the District. Eligible Project Costs include, but are not limited to, construction, alteration, rebuilding or expansion of distribution mains; manholes and valves; hydrants; service laterals; pumping stations; wells; water treatment facilities; storage tanks and reservoirs; and all related appurtenances. To the extent water system projects undertaken within the District provide direct benefit to land outside of the District, the City will make an allocation of costs based on such benefit. Those costs corresponding to the benefit allocated to land within the District, and necessitated by the implementation of the Project Plan, are eligible Project Costs. Implementation of the Project Plan may also require that the City construct, alter, rebuild or expand water system infrastructure located outside of the District. That portion of the costs of water system projects undertaken outside the District which are necessitated by the implementation of the Project Plan are eligible Project Costs. Storm water Management System Improvements Development within the District will cause stormwater runoff. To manage this stormwater runoff, the City may need to construct, alter, rebuild or expand stormwater management infrastructure within the District. Eligible Project Costs include, but are not limited to, construction, alteration, rebuilding or expansion of: stormwater collection mains; inlets, manholes and valves; service laterals; ditches; culvert pipes; box culverts; bridges; stabilization of stream and river banks; and infiltration, filtration and detention Best Management Practices (BMP's). To the extent stormwater management system projects undertaken within the District provide direct benefit to land outside of the District, the City will make an allocation of costs based on such benefit. Those costs corresponding to the benefit allocated to land within the District, and necessitated by the implementation of the Project Plan, are eligible Project Costs. Implementation of the Project Plan may also require that the City construct, alter, rebuild or expand stormwater management infrastructure located outside of the District. That portion of the costs of stormwater management system projects undertaken outside the District which are necessitated by the implementation of the Project Plan are eligible Project Costs. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 112 Electric Service To create sites suitable for development, the City may incur costs to provide, relocate or upgrade electric services. Relocation may require abandonment and removal of existing poles or towers, installation of new poles or towers, or burying of overhead electric lines. Costs incurred by the City to undertake this work are eligible Project Costs. Gas Service To create sites suitable for development, the City may incur costs to provide, relocate or upgrade gas mains and services. Costs incurred by the City to undertake this work are eligible Project Costs. Communications Infrastructure To create sites suitable for development, the City may incur costs to provide, relocate or upgrade infrastructure required for voice and data communications, including, but not limited to: telephone lines, cable lines and fiber optic cable. Costs incurred by the City to undertake this work are eligible Project Costs. Streets and Streetscape Street Improvements To allow development to occur, the City may need to construct or reconstruct streets, highways, alleys, access drives and parking areas. Eligible Project Costs include, but are not limited to: excavation; removal or placement of fill; construction of road base; asphalt or concrete paving or repaving; installation of curb and gutter; installation of sidewalks and bicycle lanes; installation of culverts, box culverts and bridges; rail crossings and signals; utility relocation, to include burying overhead utility lines; street lighting; installation of traffic control signage and traffic signals; pavement marking; right-of-way restoration; installation of retaining walls; and installation of fences, berms, and landscaping. Streetscaping and Landscaping To attract development and/or redevelopment consistent with the objectives of this Plan, the City may install amenities to enhance development sites, rights- of-way, and other public spaces. These amenities include but are not limited to landscaping; lighting of streets, sidewalks, parking areas and public areas; installation of planters, benches, clocks, tree rings, trash receptacles and similar items; and installation of brick or other decorative walks, terraces and street crossings. These and any other similar amenities installed by the City are eligible Project Costs. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 113 Community Development Cash Grants (Development Incentives) The City may enter into agreements with property owners, lessees, or developers of land located within the District for sharing costs to encourage the desired kind of improvements and assure tax base is generated sufficient to recover Project Costs. No cash grants will be provided until the City executes a developer agreement with the recipient of the cash grant. Any payments of cash grants made by the City are eligible Project Costs. Miscellaneous Property Tax Payments to Town Property tax payments due to the Town of La Prairie under Wis. Stat. § 66.1105(4)(gm)1. because of the inclusion of lands annexed after January 1, 2004 within the boundaries of the District are an eligible Project Cost. Projects Outside the Tax Increment District Pursuant to Wis. Stat. § 66.1105(2)(f)1.n, the City may undertake projects within territory located within one-half mile of the boundary of the District provided that: 1) the project area is located within the City's corporate boundaries; and 2) the projects are approved by the Joint Review Board. The cost of projects completed outside the District pursuant to this section are eligible project costs and may include any project cost that would otherwise be eligible if undertaken within the District. The City intends to make the following project cost expenditures outside the District: • Installation of traffic signals at Racine Street at its intersection with the frontage road. Development of the Project and the additional land included within the territory to be added to the District will necessitate installation of signals. Professional Service and Organizational Costs The costs of professional services rendered, and other costs incurred, in relation to the creation, administration and termination of the District, and the undertaking of the projects contained within this Plan, are eligible Project Costs. Professional services include but are not limited to architectural; environmental; planning; engineering; legal; audit; financial; and the costs of informing the public with respect to the creation of the District and the implementation of the Plan. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 114 Administrative Costs The City may charge to the District as eligible Project Costs reasonable allocations of administrative costs, including, but not limited to, employee salaries. Costs allocated will bear a direct connection to the time spent by City employees relating to the implementation of the Plan. Financing Costs Interest expense, debt issuance expenses, redemption premiums, and any other fees and costs incurred in conjunction with obtaining financing for projects undertaken under this Plan are eligible Project Costs. Tax Incremental District No.32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 115 SECTION 6: Map Showing Proposed Improvements and Uses The District's boundaries are not being amended. The "Map Showing Proposed Improvements and Uses" included within the District's amended Project Plan dated July 8, 2019 remains unchanged and is incorporated by reference as part of this Plan Amendment. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 116 SECTION 7: Detailed List of Estimated Project Costs The prior Plan Amendment dated July 8, 2019, provided for an estimated $24.23 million in expenditures to include $10 million to be transferred to TID No. 36. The City has made approximately $10.13 million in expenditures through December 31, 2021. Projected expenditures in 2022 and through the remaining life of the District, to include the transfer of excess revenue to the Recipient Districts, are shown on the table included below and total to $19.85 million. These projected expenditures will cause total costs to exceed the current Plan estimate by $5.72 million. This Amendment provides the City authority to make the additional expenditures. City of Janesville, Wisconsin Tax Increment District # 32 Detailed List of Estimated Project Costs Estimated District Project Costs Original Project Plan 6,580,560 Amendment No.1 7,673,069 Prior Allocation Authorizatio 10,000,000 Estimated Project Costs as of (10,128,530} Unexpended Balance 14,125,099 Project ID Project Name/Type 2022 2023 2024 2025-2029 Total Development Incentive- 1 1,333,333 2,666,667 0 0 4,000,000 The Glade Phase II Development Incentive- 2 0 1,333,333 2,666,667 0 4,000,000 The Glade Phase III Development Incentive 3 200,000 0 0 0 200,000 Payments-Sara Investments 4 Allocation to TID 28 350,000 0 0 0 350,000 5 Allocation to TID 36 250,000 1,943,784 1,186,637 7,864,578 11,250,000 6 Administrative Expense 5,150 5,150 5,150 32,750 48,200 Total Projects 2,138,483 5,953,934 3,858,454 7,897,328 19,848,200 Addition/(Reduction)in Estimated District Project Costs 5,723,101 Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 117 SECTION 8: Economic Feasibility Study, Description of the Methods of Financing Estimated Project Costs and the Time When Related Costs or Monetary Obligations are to be Incurred This Section includes an updated forecast of the valuation increases expected within the District, the associated tax increment collections, a summary of how remaining Project Costs would be financed, and a projected cash flow demonstrating that the District remains economically feasible. Key Assumptions The Project Costs the City has made and plans to make are expected to create $189 million in incremental value by January 1, 2025, with $150.9 million of that total in place as of January 1, 2022. Estimated valuations and timing for construction of the Project are included in Table 1. Assuming the City's current equalized TID Interim tax rate of $21.89 per thousand of equalized value, and no economic appreciation or depreciation, the Project would generate an additional $27.2 million in incremental tax revenue over the remaining 7-year term of the District as shown in Table 2 Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 118 City of Janesville, Wisconsin Tax Increment District# 32 Development Assumptions Construction The Glade The Glade Construction Actual' Annual Total Year Phase 112 Phase 1113 Year 10 2017 66,286,200 66,286,200 2017 10 11 2018 (3,155,3001 (3,155,800) 2018 11 12 2019 19,097,000 19,097,000 2019 12 13 2020 23,319,300 23,319,300 2020 13 14 2021 45,392,200 45,392,200 2021 14 15 2022 13,063,300 13,063,300 2022 15 16 2023 8,351,400 8,351,400 2023 16 17 2024 16,702,800 16,702,800 2024 17 13 2025 0 2025 18 19 2026 0 2026 19 20 2027 0 2027 20 Totals 150,938,900 13,063,300 25,054,200 189,056,400 Notes: 1Value shown as actual for construction year 2017 reflects actual total incremental value of District as of January 1,2018. 2Value for 2022 construction reflects assessor's estimate provided on 7-25-2022 divided by 72%(1-1-2022 estimated assessment ratio). 3Assumes three additional 48 unit buildings are added,one building in 2023 and two in 2024,with a valuation of$6,013,000 per building adjusted to reflect a 72%assessment ratio). Table 1 - Development Assumptions Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 119 City of Janesville, Wisconsin Tax Increment District# 32 Tax Increment Projection Worksheet Type of District Mixed Use Base Value 81,272,100 District Creation Date September 22,2008 Appreciation Factor 0.0096 Valuation Date Jan 1, 2008 Base Tax Rate $21.89 Max Life(Years) 20 Rate Adjustment Factor Expenditure Period/Termination 15 9/22/2023 Revenue Periods/Final Year 20 2029 Extension Eligibility/Year Yes 6 Eligible Recipient District No Construction Valuation Inflation Total Revenue Tax Year Value Added Year Increment Increment Year Tax Rate' Increment 11 2018 -3,155,800 2019 63,130,400 2020 $22.21 1,401,839 12 2019 19,097,000 2020 82,227,400 2021 $21.91 1,802,013 13 2020 23,319,300 2021 105,546,700 2022 $21.89 2,310,390 14 2021 45,392,200 2022 150,938,900 2023 $21.89 3,304,013 15 2022 13,063,300 2023 0 164,002,200 2024 $21.89 3,589,965 16 2023 8,351,400 2024 0 172,353,600 2025 $21.89 3,172,775 17 2024 16,702,800 2025 0 189,056,400 2026 $21.89 4,138,395 18 2025 0 2026 0 189,056,400 2027 $21.89 4,138,396 19 2026 0 2027 0 189,056,400 2028 $21.89 4,138,395 20 2027 0 2028 0 189,056,400 2029 $21.89 4,138,395 Totals 122,770,200 0 Future Value of Increment(2023-2029) 27,220,335 Notes: "Tax rate shown for the 2022 and preceding revenues years is actual per DOR Form PC-202(Tax Increment Collection Worksheet). Table 2 - Tax Increment Projection Worksheet Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 120 Financing and Implementation Remaining anticipated Project Costs include development incentives, transfers of tax increment to the Recipient Districts and administrative expense. All costs are expected to be paid from cash on hand, of from future collections of tax increment. Based on the Project Cost expenditures as included within the cash flow exhibit (Table 3), the District is projected to accumulate sufficient funds by the year 2026 to pay off all Project cost liabilities and obligations. The projected closure is based on the various assumptions noted in this Plan and will vary dependent on actual Project Costs incurred and the actual amount of tax increments collected. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 121 City of Janesville, Wisconsin Tax increment District t#32 Cash Flow Projection Projected Revenues Expenditures Balances Development Incentive Payments' Year interest State& Service Total Tax Earnings/ Federal Charges& Total Capital Prior The Glade The Glade Sara Transfer to Transfer to Expenditure Increments (Cost) Aids' Other Revenues Projects Incentives Phase II Phase III Investments TID No.28 TID No.36 Other Exp. Admin. s Annual Cumulative' Year 2017 1,030,166 35,436 84,800 93,632 1,244,034 27,406 335,000 4,795 367,201 876,833 1,814,507 2017 2018 1,484,313 63,551 86,047 46,144 1,680,055 29,465 81,270 7,512 118,247 1,561,808 3,376,315 2018 2019 1,521,640 83,856 152,620 99,815 1,857,931 1,426,174 250,000 43,376_ 1,719,550 138,381 3,514,696 2019 2020 1,401,839 14,469 248,489 123,956 1,788,753 3,589,321 250,000 2,285 3,841,606 (2,052,853) 1,461,843 2020 2021 1,802,013 3,979 344,359 130,609 2,280,960 1,537,651 250,000 14,116 1,801,767 479,194 1,941,037 2021 2022 2,310,390 248,489 20,000 2,578,879 1,333,333 200,000 350,000 250,000 5,150 2,138,483 440,396 2,381,432 2022 2023 3,304,013 248,489 20,000 3,572,502 2,666,667 1,333,333 1,948,784 5,150 5,953,934 (2,381,432) 0 2023 2024 3,589,965 248A89 20,000 3,858,454 2,666,667 1,186,637 5,150 3,858,454 0 0 2024 2025 3,772,775 248,489 20,000 4,041,264 4,032,614 8,650 4,041,264 0 0 2025 2026 4,138,395 248,489 20,000 4,406,884 3,831,964 5,150 3,837,114, 569,771 569,771 2026 2027 4,138,395 248,489 20,000 4,406,884 5,150 5,150 4,401,734 4,971,505 2027 2028 4,138,395 248,489 20,000 4,406,884 5,150 5,150 4,401,734 9,373,239 2028 2029 4,138,395 248,489 20,000 4,406,884 8,650 8,650 4,398,234 13,771,474 2029 Total 36,770,696 201,291 2,904,227 794,156 40,530,370 6,610,017 335,000 4,000,000 4,000,000 200,000 350,000 12,000,000 81,270 120,284' 27,696,571 Total Notes: �I Projected District Closure `Exempt Computer Aids and Personal Property Exemption Aid Payments 'The Glade Phase I incentives are reflected in the Capital Projects totals in 2020 and 2021.Phase III incentive assumes three additional 48 unit buildings with an incentive of$1,333,000 per building. 'Year ending fund balances shown through 2021 reflect actual per City's audited financial statements. Table 3-Cash Flow Tax Incremental District No.32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 122 SECTION 9: Annexed Property A tax incremental district cannot include annexed territory unless at least three years have elapsed since the annexation, or certain other requirements are met. No territory is being added to the District as part of this Plan Amendment. SECTION 10: Estimate of Property to be Devoted to Retail Business Pursuant to Wis. Stat. § 66.1105(5)(b), the City estimates that less than 35% of the territory within the District will be devoted to retail business at the end of the District's maximum expenditure period. SECTION 11: Proposed Changes of Zoning Ordinances, Master Plan, Map, Building Codes and City Ordinances Zoning Ordinances The proposed Plan Amendment is in general conformance with the City's current zoning ordinances. Individual properties may require rezoning at the time of development. Master (Comprehensive) Plan and Map The proposed Plan Amendment is in general conformance with the City's Comprehensive Plan identifying the area as appropriate for mixed use' development. Building Codes and Ordinances Development within the District will be required to conform to State Building Codes and will be subject to the City's permitting and inspection procedures. The proposed Plan Amendment conforms to all relevant State and local ordinances, plans, and codes. No changes to the existing regulations are proposed or needed. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 123 SECTION 12: Statement of the Proposed Method for the Relocation of any Persons to be Displaced Should the continued implementation of this Plan require relocation of individuals or business operations, relocations will be handled in compliance with Wis. Stat. Chapter 32 and Wis. Admin. Code ADM 92. SECTION 13: How Amendment of the Tax Incremental District Promotes the Orderly Development of the City This Plan Amendment continues to promote the orderly development of the City by providing appropriate financial incentives for private development projects, specifically market-rate multi-family housing, and by providing financial resources to the Recipient Districts that will assist with rehabilitating and conserving property, eliminating blighted areas and provision of necessary public infrastructure improvements Development will occur in an orderly fashion in accordance with approved plans. Development of new uses in the District will add to the tax base and will generate positive secondary impacts in the community such as provision of employment and commercial opportunities related to the construction and operation of the Project. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 124 SECTION 14: List of Estimated Non-Project Costs Non-project costs are public works projects which only partly benefit the District. Costs incurred that do not benefit the District may not be paid with tax increments. Examples of non-project costs are: • A public improvement made within the District that also benefits property outside the District. That portion of the total Project Costs allocable to properties outside of the District would be a non-project cost. • A public improvement made outside the District that only partially benefits property within the District. That portion of the total Project Costs allocable to properties outside of the District would be a non- project cost. • Projects undertaken within the District as part of the implementation of this Project Plan, the costs of which are paid fully or in part by impact fees, grants, special assessments, or revenues other than tax increments. No improvements to be made within the District will benefit property outside the District. Furthermore, there will be no improvements made outside the District that will only partially benefit the District. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 125 SECTION 15: Legal Opinion Advising Whether the Plan is Complete and Complies with Wis. Stat. § 66.1105(4)(f) Legal Opinion Found on Following Page. Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 126 CITY OF JANESVILLE _+►" ..•/1►••M Weacruu 4c Q Pan! s7€a e: -00 - Discover the community of choice to realize life's opportunities CITY ATTORNEY'S OFFICE MEMORANDUM August 30, 2022 TO: Jimsi Kuborn, Economic Development Director FROM: Wald Klimczyk, City Attorney RE: Legal Opinion —TID 32 Project Plan Amendment No. 3 Sec. 66.1105(4)(f), Wis. Stats., of the Tax Increment Financing Law mandates that the project plan or any plan amendment for a tax increment financing district "include an opinion of the city attorney or an attorney retained by the city advising whether the plan is complete and complies with this section." You have asked me to review a certain proposed "Amendment No. 3 to the Project Plan," dated September 6, 2022 (the planned date for Common Council action) and determine if, in my legal opinion, it is complete and complies with the requirements of Wisconsin's T.I.F. Law. This memorandum constitutes my legal opinion. Sec. 66.1105(4)(f), Wis. Stats., sets forth those components of a T.I.F. project plan which are required by state law. They are as follows: 1. A statement listing the kind, number, and location of all proposed public works or improvements within the district or, to the extent provided in Section 66.1105(4)(f) 1. k, Wis. Stats., outside the district; 2. An economic feasibility study; 3. A detailed list of estimated project costs; 4. A description of the methods of financing all of the estimated projected costs; 5. The time when the costs or monetary obligations related thereto are to be incurred; Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 127 Jimsi Kuborn August 30, 2022 Page 2 6. A map showing the existing uses and conditions of the real property in the district; 7. A map showing the proposed improvements and uses in the district; 8. Proposed changes of: a. Zoning ordinances. b. The master plan, if any. c. The master map, if any. d. Building codes. e. City ordinances. 9. A list of estimated non-project costs; 10. A statement of proposed methods for the relocation of any person(s) to be displaced; and 11. How the Tax Increment Financing District promotes the orderly development of the City. I have reviewed proposed "Amendment No. 3 to the Project Plan," dated September 6, 2022, prepared by Elhers and Associates in conjunction with the City of Janesville Economic Development Office and Finance Division. It is my legal opinion that said project plan amendment, as prepared for the Economic Development Office, is complete and does comply with Section 66.1105(4) (f), Wis. Stats. According to the terms of the above cited statute, this legal opinion should now become the final component of that project plan amendment. Wald Klimczyk City Attorney wk cc: Lorena Rae Stottler, City Clerk-Treasurer Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 128 SECTION 16: Calculation of the Share of Projected Tax Increments Estimated to be Paid by the Owners of Property in the Overlying Taxing Jurisdictions The following projection is provided to meet the requirements of Wis. Stat. § 66.1105(4)(i)40. Blackhawk Revenue Technical City of School District Revenue Year Rock County College Janesville OfJanesville Total Year 2023 815,844 153,312 1,046,607 1,288,250 3,304,013 2023 2024 886,452 166,581 1,137,188 1,399,745 3,589,965 2024 2025 931,593 175,063 1,195,096 1,471,023 3,772,775 2025 2026 1,021,874 192,029 1,310,913 1,613,580 4,138,395 2026 2027 1,021,874 192,029 1,310,913 1,613,580 4,138,395 2027 2028 1,021,874 192,029 1,310,913 1,613,580 4,138,395 2028 2029 1,021,874 192,029 1,310,913 1,613,580 4,138,395 2029 Totals 6,721,383 1,263,072 8,622,542 10,613,339 27,220,335 Tax Incremental District No. 32 Project Plan Amendment City of Janesville Prepared by Ehlers Page 129