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HomeMy WebLinkAbout080414 TIF Summary Report7/16/2014 1 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. Presentation of the Umbaugh TIF Report dated May 29, 2014 1 July 16, 2014 UMBAUGH Loren Matthes, Principal Heidi Amspaugh, Manager Andy Mouser, Sr. Financial Analyst City of Carmel Redevelopment Commission © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. Summary of Designated Areas •City Center Area •126th Street Area •Merchants Square Area •Merchants Pointe Area •2006 Merchants Pointe Area •Illinois Street Area, Expansion Area and Amended Area •Old Meridian Area and Expansion Area •Old Town Area •Hazel Dell South Area •Hazel Dell North Area •Carmel Drive Area •Lauth-Walker Area •Old Town Shoppes Area •2006 Old Town Shoppes Area •Old Methodist Area •Lurie Area •Village of West Clay Area •Meridian & Main Area (50%) •116th Street Centre Area (less Developer portion) •Downtown EDA #1 Area •Downtown EDA #2 Area •CRC Parcel #12 Area •Parkwood Crossing Areas 2 7/16/2014 2 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. Commercial Offices, Retail, Restaurants, Hotels, Hospitals, Senior Living Facilities 126th Street Area, Illinois Street, and Old Meridian Areas 3 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. Old Town Area 4 7/16/2014 3 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. City Center Area, Downtown Areas 1 and 2 5 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. General Tax Increment •Designated Areas Tax Increment –Estimated 2014 = $17,524,854 –Estimated to increase to $25,397,302 in 2026 –Designated Areas begin to expire in 2029 and thereafter •Midwest ISO Depreciable Personal Property (DPP) TIF –5/29/14 TIF Report assumes no current or future Tax Increment from the MISO DPP TIF •Barrington PILOT Payments –Assisted Living Facility, anticipated exempt from property taxes –City Ordinance and Exhibit: payments in lieu of taxes (PILOT) –$175,000 to $350,000 annual PILOT Payments –Pay 2014: The Barrington did not file for exemption; site in EDA, not Allocation Area; no TIF –Assumes PILOT payments begin 2015 payable 2016 –Anticipated to be distributed to CRC to pay obligations 6 7/16/2014 4 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. Summary of Other Revenues •4CDC Grant Funds –Carmel City Center Community Development Corporation (4CDC) –2014 = $338,000; 2015 & thereafter = $400,000 per year •Civic Payments –Booth Tarkington Civic Theatre of Indianapolis, Inc. –$200,000 per year •Energy Consumption Payments –Ranges from $323,060 to $1,261,294 •Merchants Square Bond Excess –One-time funds available after the defeasance of the TIF Revenue Bonds of 1998 –2014 = $565,281 •Revenue Reserves –Energy Payments –$1.5 million: provides $500,000 for 3 years (2013 –2015) –Civic Payments -$1.2 million: provides $200,000 for 6 years (2013 –2018) 7 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. Summary of CRC Obligations Paid-off and Refinanced in 2012 •Taxable Tax Increment Revenue Bonds of 2008 •Certificates of Participation (COPs), Series 2010A and B •8 Installment Purchase Contracts •7 Grant Agreements securing Lines of Credit •4 Land Sale Contracts 8 7/16/2014 5 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. Summary of Current District Obligations (Paid from CRC Revenues) •$6,595,000 TIF Revenue Bonds, 2004A (Clarian/IU Health Guarantee) •$55,685,000 Lease Rental Refunding Bonds, 2014 (CIBs) PAC •$27,798,227 Lease Rental Bonds of 2005 (CABs) PAC •$4,175,000 Taxable COIT Revenue Refunding Bonds, 2006 •$15,775,000 Certificates of Participation, 2010C (C COPs) •$115,900,000 Lease Rental Multipurpose Bonds, 2012A •$68,245,000 Lease Rental Multipurpose Bonds, 2012B (Taxable) •$6,535,000 Redevelopment District Bonds of 2013 (Illinois Street Bonds) •Subordinate Developer Obligations (shown in Appendix C and D) –$9,200,000 Senior EDC Bonds, 2011A (Lofts -Sophia Square) –$4,500,000 Replacement Secondary Installment Contract #1 –$1,000,000 Replacement Secondary Installment Contract #2 (RSICs) 9 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. TIF Report -Appendices •Appendix A –TIF Risks •Appendix B –Amortization Schedules of Outstanding CRC Obligations •Appendix C –Arts District Lofts &Shoppes TIF (Sophia Square Project) –TIF Estimate and Outstanding EDC Bonds 2011A •Appendix D –Village Financial Restated Secondary Installment Contracts (RSIC) –Special Calculation of (Pedcor) Existing Improvement Increment (part of BIG TIF), Allocated portion of $17 MM Harris Loan (part of 2012 Refinance Multipurpose Bonds) and $5.5 MM RSICs to calculate estimated payment or deferment of interest and principal on RSICs –Deferred interest and principal paid from BIG TIF/CRC Revenues in 2030 thru 2034 (subordinate) (Deferred amounts are included in District Obligations on page 16) •Appendix E –Revenue Deposit Agreement and Amendments 10 7/16/2014 6 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. $0 $2,000,000 $4,000,000 $6,000,000 $8,000,000 $10,000,000 $12,000,000 $14,000,000 $16,000,000 $18,000,000 Historical Tax Increment Collections Tax Increment Collections 11 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. $0 $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000 $30,000,000 Comparison of Estimated CRC Revenues 5/29/2014 TIF Report 12/27/2012 TIF Report 2005 TIF Estimate 12 7/16/2014 7 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. Significant additions to the CRC Revenue Estimate (Changes since 12/27/12 TIF Report) 12/27/12 TIF Report –Highpointe Senior Living & Apts -payable 2017 –Sophia Place Parcel 92 –payable 2016 –Bridges PUD Development (was 25%; now 100%) and Future Development 50/50 TIF Split –Anderson Birkla “The Mezz” and Nash Buildings in City Center –Hotel Indigo –Browning Medical Office Buildings –Penn Circle Apts & Mixed Use –116thStreet Centre Apts Phase 2 –Edward Rose Apts Phase 2 Additions in 5/29/14 TIF Report –Atapco Apts, retail, office and demo of existing buildings –Health & Wellness Suites of Carmel (assisted living) –Horizon Bank –Point Blank Gun Range –Penn Circle (Phase 2 apartments) –Drury Hotel and Restaurant (Parkwood Area) –St. Vincent’s Women’s Center (assumes taxable) –The Bridges PUD –Giant Eagle Grocery & Get and Go Gas Station –Project Blue: Hyundai; $8.1M AV to CRC; Excess to Developer –Grand & Main Project 75/25 TIF Split (was on Future Development listing @ 100%) •Added Merchants Square and Merchants Pointe TIF Revenue (Plus one-time remaining MS Bond funds –2014 only) •New Developments added or moved up: 13 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. Significant Decreases to the CRC Revenue Estimate (Changes since 12/27/12 TIF Report) •Decrease in Tax Rate:2013 = $1.8651 2014 = $1.8453 Variance = ($0.0198) •Residential Parcels:TIF database now includes negative incremental AV from residential parcels -Annual AV loss of $1MM = Annual TIF loss of $18,000 •2013 TIF distribution error:reduced 2014 TIF estimate for County Auditor error in 2013 TIF distribution calculation and school referendum calculation, which impacts June 2014 distribution (2014 TIF loss of $100,000) •IU Health Expansion removed from TIF Estimate -AV loss of $23.4MM = Annual TIF loss of $431,000 •Pushed-back timing on several New and Future Developments •Decrease in annual 4CDC Grant Funds -Revenue loss of $357,000/yr •Removed Developer Payments from Keystone Corp.–Revenue loss of $200,000/yr (2013 –2016) •Removed 1% annual increase in assessed values for Market Value changes •Removed Revenue Loss Adjustment •Reduced Grand & Main Development (Edward Rose Apartments) 14 7/16/2014 8 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. $0 $5,000,000 $10,000,000 $15,000,000 $20,000,000 $25,000,000 $30,000,000 (5/29/14 TIF Report) Comparison of Estimated CRC Revenues and Obligations Total Estimated CRC Revenues Combined (PAC) 2005 CABs and 2014 Bonds 2006 COIT Bonds Debt Service 2010 C COPs Debt Service 2012 Bonds Lease Rentals Estimated RSICs 2004A Bonds Debt Service 2013 Bonds Debt Service 15 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. Comparison of Estimated 2014 CRC Revenues and Obligations 2005 TIF Estimate 12/27/12 TIF Report 5/29/14 TIF Report Total Estimated TIF $8,489,950 $16,978,413 $17,524,854* 4CDC Grant Funds0 757,603 338,000 Civic Payments 0 200,000 200,000 Energy Consumption Pmts0 1,310,103 323,060 Other Revenues (2014) 0(650,000)1,265,281 Total Estimated CRC Revenues $8,489,950 $18,596,119 $19,651,195 CRC Debt Obligations $8,035,175 ($17,344,230)($17,524,082) Estimated Surplus $454,775 $1,251,889 $2,127,113 Estimated Coverage 105.66%107.22%112.14% *Added TIF Areas to the General TIF Revenues. 16 7/16/2014 9 © 2014 H. J. Umbaugh and Associates, Certified Public Accountants, LLP. All rights reserved. Revenue Deposit Agreement •Original Agreement 11/20/12 –Established procedure for the Clerk-Treasurer (CRC Treasurer ) to set aside the General Tax Increment when received to ensure timely payment of CRC Obligations (2013 Bonds, 2010 C COPs, 2012 Bonds, and 2005/2014 PAC Bonds) –Establishment of Supplemental Reserve Fund to be funded by Parkwood TIF Revenue after pay-off of Parkwood EDC Bonds in 2014 •Additional protection against TIF shortfall and Special Tax levy •First Amendment 12/05/13 –Prioritize set-aside of TIF Revenues from Illinois Street Areas and 126th Street Areas to pay 2013 Bond debt service –Added Merchants Square Allocation Area to Designated Areas •Second Amendment 05/29/14 –Refunding of 2005 PAC Bonds –CIBs only –Required deposit of General Tax Increment equal to savings from the 2014 Refunding into the Supplemental Reserve Fund 17