HomeMy WebLinkAboutD-2180-14 KG Main LLC/The Olivia on Main EDR bonds - $3,825,000 •
Sponsor: Councilor Snyder
ORDINANCE D-2180-14
AS AMENDED •
AN ORDINANCE OF THE COMMON COUNCIL OF THE
CITY OF CARMEL, INDIANA, AUTHORIZING THE
ISSUANCE OF THE CITY OF CARMEL, INDIANA
ECONOMIC DEVELOPMENT REVENUE BONDS, SERIES
2014 (KG MAIN LLC PROJECT), AND AUTHORIZING AND
APPROVING OTHER ACTIONS IN RESPECT THERETO
WHEREAS, the City of Carmel, Indiana (the "City"), is a municipal corporation and
political subdivision of the State of Indiana and by virtue of I.C. 36-7-11.9 and I.C. 36-7-12
(collectively, the "Act"), is authorized and empowered to adopt this ordinance (this "Bond
Ordinance") and to carry out its provisions;
WHEREAS, KG Main LLC or an affiliate thereof (the "Company"), desires to finance
the design and construction of certain improvements described in Exhibit A hereto which are
located in the Old Meridian Economic Development Area(collectively, the "Projects");
WHEREAS, the Company will complete the Projects for use in connection with its mixed
use development in or directly serving and benefiting the Sophia Pointe Allocation Area (the
"Facilities");
WHEREAS, the Company has advised the City of Cannel Economic Development
Commission (the "Commission") and the City that it proposes that the City issue its Economic
Development Revenue Bonds, Series 2014 (KG Main LLC Project) in an amount not to exceed
Three Million Eight Hundred Twenty-Five Thousand Dollars ($3,825,000) (the `Bonds"), under
the Act and provide the proceeds of such Bonds to the Company for the purpose of financing the
Projects;
WHEREAS, the completion of the Projects results in the diversification of industry, the
creation of jobs and the creation of business opportunities in the City;
WHEREAS, pursuant to I.C. § 36-7-12-24, the Commission published notice of a public
hearing (the "Public Hearing") on the proposed issuance of the Bonds to finance the Projects;
WHEREAS, on the date specified in the notice of the Public Hearing, the Commission
held the Public Hearing on the Projects; and
WHEREAS, the Commission has performed all actions required of it by the Act
preliminary to the adoption of this Bond Ordinance and has approved and forwarded to the
Common Council the forms of: (1) a Financing Agreement between the City and the Company
(the "Financing Agreement"); (2) a Trust Indenture between the City a trustee to be selected by
the Clerk-Treasurer of the City (the "Trustee") (the "Indenture"); (3) the Bonds; and (4) this
Bond Ordinance (the Financing Agreement, the Indenture, the Bonds, and this Bond Ordinance,
collectively, the"Financing Agreements");
NOW, THEREFORE, BE IT ORDAINED BY THE COMMON COUNCIL OF THE
CITY OF CARMEL, INDIANA, THAT:
Section 1. Findings; Public Benefits. The Common Council hereby finds and
determines that the Projects involve the acquisition, construction and equipping of an
"economic development facility" as that phrase is used in the Act; that the Projects will
increase employment opportunities and increase diversification of economic development
in the City, will improve and promote the economic stability, development and welfare in
the City, will encourage and promote the expansion of industry, trade and commerce in
the City and the location of other new industries in the City; that the public benefits to be
accomplished by this Bond Ordinance, in tending to overcome insufficient employment
opportunities and insufficient diversification of industry, are greater than the cost of
public services (as that phrase is used in the Act) which will be required by the Project;
and, therefore, that the financing of the Projects by the issue of the Bonds under the Act:
(i) will be of benefit to the health and general welfare of the City; and (ii) complies with
the Act.
Section 2. Approval of Financing. The proposed financing of the Projects by
the issuance of the Bonds under the Act, in the form that such financing was approved by
the Commission, is hereby approved.
Section 3. Authorization of the Bonds. The issuance of the Bonds, payable
solely from revenues and receipts derived from the Financing Agreements, is hereby
authorized.
Section 4. Terms of the Bonds. (a) The Bonds, in the aggregate principal
amount not to exceed Three Million Eight Hundred Twenty-Five Thousand Dollars
($3,825,000), shall (i) be executed at or prior to the closing date by the manual or
facsimile signatures of the Mayor and the Clerk-Treasurer of the City; (ii) be dated as of
the date of their delivery; (iii) mature on a date not later than twenty-five years after the
date of the first draw of principal on the Bonds; (iv) bear interest at such rates as
determined with the purchaser thereof (the "Purchaser"); (v) be issuable in such
denominations as set forth in the Financing Agreements; (vi) be issuable only in fully
registered form; (vii) be subject to registration on the bond register as provided in the
Indenture; (viii) be payable in lawful money of the United States of America; (ix) be
payable at an office of the Trustee as provided in the Indenture; (x) be subject to optional
redemption prior to maturity and subject to redemption as otherwise provided in the
Financing Agreements; (xi) be issued in one or more series; and (xii) contain such other
terms and provisions as may be provided in the Financing Agreements.
(b) The Bonds and the interest thereon do not and shall never constitute an
indebtedness of, or a charge against the general credit or taxing power of, the City, but
shall be special and limited obligations of the City, payable solely from revenues and
other amounts derived from the Financing Agreements. Forms of the Financing
Agreements are before this meeting and are by this reference incorporated in this Bond
Ordinance, and the Clerk-Treasurer of the City is hereby directed, in the name and on
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behalf of the City, to insert them into the minutes of the Common Council and to keep
them on file.
Section 5. Sale of the Bonds. The Mayor and the Clerk-Treasurer of the City
are hereby authorized and directed, in the name and on behalf of the City, to sell the
Bonds to the Purchaser at such prices as are determined on the date of sale and approved
by the Mayor and the Clerk-Treasurer of the City.
Section 6. Execution and Delivery of Financing Agreements. The Mayor and
the Clerk-Treasurer of the City are hereby authorized and directed, in the name and on
behalf of the City, to execute or endorse and deliver the Financing Agreement, the
Indenture, and the Bonds, submitted to the Common Council, which are hereby approved
in all respects.
Section 7. Changes in Financing Agreements. The Mayor and the Clerk-
Treasurer of the City are hereby authorized, in the name and on behalf of the City,
without further approval of the Common Council or the Commission, to approve such
changes in the Financing Agreements as may be permitted by Act, such approval to be
conclusively evidenced by their execution thereof.
Section 8. Reimbursement from Bond Proceeds. The City hereby declares its
intent to issue the Bonds for the purpose of financing the Projects, which Bonds will not
exceed $3,825,000, and pursuant to Treas. Reg. §1.150-2 and IC 5-1-14-6(c), to
reimburse costs of the Projects (including costs of issuing the Bonds) from proceeds of
the sale of such Bonds.
Section 9. General. The Mayor and the Clerk-Treasurer of the City, and each
of them, are hereby authorized and directed, in the name and on behalf of the City, to
execute or endorse any and all agreements, documents and instruments, perform any and
all acts, approve any and all matters, and do any and all other things deemed by them, or
either of them, to be necessary or desirable in order to carry out and comply with the
intent, conditions and purposes of this Bond Ordinance (including the preambles hereto
and the documents mentioned herein), the Projects, the issuance and sale of the Bonds,
and the securing of the Bonds under the Financing Agreements, and any such execution,
endorsement, performance or doing of other things heretofore effected be, and hereby is,
ratified and approved.
Section 10. Binding Effect. The provisions of this Bond Ordinance and the
Financing Agreements shall constitute a binding contract between the City and the
holders of the Bonds, and after issuance of the Bonds this Bond Ordinance shall not be
repealed or amended in any respect which would adversely affect the rights of the holders
of the Bonds as long as the Bonds or interest thereon remains unpaid.
Section 11. Repeal. All ordinances or parts of ordinances in conflict herewith
are hereby repealed.
Section 12. Effective Date. This Bond Ordinance shall be in full force and
effect immediately upon adoption and compliance with I.C. § 36-4-6-14.
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Section 13. Copies of Financing Agreements on File. Two copies of the
Financing Agreements incorporated into this Bond Ordinance were duly filed in the
office of the Clerk-Treasurer of the City, and are available for public inspection in
accordance with I.C. § 36-1-5-4.
PASSED by the Common Council of the City of Carmel, this ola day of QCJ t'fJv�
2014,by a vote of 'r ayes and 0 nays.
COMMON COUNCIL OF THE CITY OF CARMEL, INDI: '
Presiding Off er Kevin D. Rider
/ /40 a()---Mhe6
W. Eric Sei ensticker, Pre i s ent Pro Tem p ore Carol Schleif
R ald E. Carter Richard L. harp
AOP
AA , 1 ,. � f f
S Tnk A / Luci , yder
ATTEST:
Diana L. Cordray, IAMC, Clerk- IQ asurer
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Presented by me to the Mayor of the City of Carmel, Indiana is a day of 0 tbrej-tit_.
2014, at R:y7 A.M. / \ /
Diana L. ordray, IAMC, Clerk-Tre. ,er
Approved by me, Mayor of the City of Carmel, Indiana, this L.-)k� day of (V I ,
2014, at$•.yv -P P .M.
(\ig
L�
v� ies Brainard, Mayor
ATTEST:
Diana L. Cordray, IAMC, Clerk-Tre:surer
Prepared by: Bruce D. Donaldson
Barnes & Thornburg LLP
11 South Meridian Street
Indianapolis, IN 46204
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EXHIBIT A
DESCRIPTION OF THE PROJECTS
Demolition of existing structures, utility relocation and connection, soft soil remediation,
on-site storm water detention, on-site utilities, grading, landscaping, parking, and general site
work and site preparation, all to support a proposed mixed use development generally to be
located in the southwest quadrant of the intersection of Main Street and Old Meridian Street, in
the City of Carmel, Indiana.
INDS01 BDD 1469105v1
6
The Olivia on Main, Carmel Indiana
Site, Infrastructure and other Associated Costs
Fulfillment of CRC Project Agreement by KG Main LLC
$ 89,000 Fulfillment of the CRC agreement:demolish the existing buildings,foundations, roads,utilities,
concrete,and tanks. Fill excavations and grade.
$ 220,000 Fulfillment of the CRC agreement: provide utilities for the construction and use of the project-
relocate the existing AT&T transfer box.
$ 159,000 Fulfillment of the CRC agreement: replace substandard soils and mitigate wetlands.
$ 50,000 Fulfillment of the CRC agreement:environmental indemnification in connection with the
presence of any hazardous wastes, materials or substances on or about the project site.
$ 373,192 Fulfillment of the CRC agreement: Developer to convey land for the Main Street right-of-way
improvement(46,319 sf).
$ 891,192 Subtotal
Other Development Costs
$ 71,253 Demolition of the remaining buildings,foundation, roads, utilities,concrete and tanks on site.
$ 983,630 Mass excavation and grading of the site which includes replacement of soft soils throughout
the site with compacted structural fill. The soils report indicates a high water table,which will
require extensive removal of soft soils.
$ 150,000 Mitigation of wetlands on site per IDEM requirements
$ 767,320 Storm water detention system below grade to accommodate City of Carmel engineering
requirements to hold storm water on site longer and release at a slower rate into City storm
water system.
$ 376,575 Utilities on site including storm,water,sanitary,water,and electrical.
$ 336,250 Site concrete for retaining walls,foundations and stairs due to the grade elevations at the east
side of the site. This was due to the high density of the site.
$ 71,253 Site preparation including stripping top soil,erosion control,and other general costs.
$ 390,615 Parking areas(asphalt and concrete pavements). Relates to the City requirement to allow for
drive through access through the site from the adjacent property.
$ 3,146,896 Subtotal
Major Project Fees
$ 590,854 Sewer and water connection fees(per email from J Duffy on 10/17/14). Our initial numbers
from the City provided work sheets were higher.
$ 342,516 Multi-family park and recreation fee
$ 933,370 Subtotal
$4,971,458 Total Costs
RESOLUTION NO. EDC ,ZO('4 Z
A RESOLUTION APPROVING AND AUTHORIZING CERTAIN ACTIONS
AND PROCEEDINGS WITH RESPECT TO CERTAIN PROPOSED
ECONOMIC DEVELOPMENT REVENUE BONDS
WHEREAS, the City of Carmel, Indiana(the "City"), is authorized by I.C. 36-7-11.9 and
I.C. 36-7-12 (collectively, the "Act") to issue revenue bonds for the financing of economic
development facilities, and loan the proceeds of the revenue bond issue to another entity to
finance or refinance the acquisition, construction, renovation, installation and equipping of said
facilities;
WHEREAS, KG Main LLC or an affiliate thereof(the "Company") desires to finance the
design and construction of the projects listed in Exhibit A hereto which are located in the Old
Meridian Economic Development Area(the"Projects");
WHEREAS, the Company will complete the Projects for use in connection with its mixed
use development in or directly serving and benefiting the The Olivia on Main Allocation Area
(the"Facilities");
WHEREAS, the Company has advised the City of Cannel Economic Development
Commission (the "Commission") and the City that it proposes that the City issue its Economic
Development Revenue Bonds, Series 2014 (KG Main LLC Project), in an amount not to exceed
Three Million Eight Hundred Twenty-Five Thousand Dollars ($3,825,000) (the `Bonds") under
the Act and provide the proceeds of such Bonds to the Company for the purpose of financing the
Projects;
WHEREAS, the Commission has studied the Projects and the proposed financing of the
Projects and their effect on the health and general welfare of the City and its citizens;
WHEREAS, the completion of the Projects results in the diversification of industry, the
creation of new jobs and the creation and retention of business opportunities in the City;
WHEREAS, pursuant to I.C. § 36-7-12-24, the Commission published notice of a public
hearing (the "Public Hearing") on the proposed issuance of the Bonds to finance the Projects;
and
WHEREAS, on the date hereof the Commission held the public hearing on the Projects;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY OF CARMEL ECONOMIC
DEVELOPMENT COMMISSION AS FOLLOWS:
SECTION 1. The Commission hereby finds, determines, ratifies and confirms that the
diversification of industry, the retention of business opportunities and the retention of
opportunities for gainful employment within the jurisdiction of the City is desirable, serves a
public purpose, and is of benefit to the health and general welfare of the City; and that it is in the
public interest that the City take such action as it lawfully may to encourage the diversification of
industry, the retention of business opportunities, and the retention of opportunities for gainful
employment within the jurisdiction of the City.
SECTION 2. The Commission hereby determines that the Facilities and the Projects
will not have a material adverse competitive effect on any similar facilities already constructed
or operating in or near the City.
SECTION 3. The Commission hereby approves the report with respect to the Projects
presented at this meeting. The Secretary of this Commission shall submit such report to the
executive director or chairman of the plan commission of the City and to the superintendent of
the Carmel Clay School Corporation.
SECTION 4. The Commission finds, determines, ratifies and confirms that the issuance
and sale of the Bonds in an amount not to exceed Three Million Eight Hundred Twenty-Five
Thousand Dollars ($3,825,000), and the provision of the proceeds of the Bonds to the Company
for the financing of the Projects will be of benefit to the health and general welfare of the City,
will serve the public purposes referred to above in accordance with the Act, and fully comply
with the Act.
SECTION 5. The financing of the Projects through the issuance of the Bonds, in an
amount not to exceed Three Million Eight Hundred Twenty-Five Thousand Dollars
($3,825,000), is hereby approved.
SECTION 6. The Commission hereby approves the terms of the following documents in
the form presented at this meeting: (i) a Financing Agreement between the City and the
Company; (ii) a Trust Indenture, between the City and a trustee to be selected by the Clerk-
Treasurer of the City (the "Trustee"); (iii) the Bonds; and (iv) an Ordinance of the Common
Council of the City.
SECTION 7. Any officer of the Commission is hereby authorized and directed, in the
name and on behalf of the Commission, to execute any and all other agreements, documents and
instruments, perform any and all acts, approve any and all matters, and do any and all other
things deemed by him to be necessary or desirable in order to carry out and comply with the
intent, conditions and purposes of this resolution (including the preambles hereto and the
documents mentioned herein), the Projects and the issuance and sale of the Bonds, and any such
execution, performance, approval or doing of other things heretofore effected be, and hereby is,
ratified and approved.
SECTION 8. The Secretary of this Commission shall transmit this resolution, together
with the forms of the documents approved by this resolution, to the Common Council of the
City.
SECTION 9. This resolution shall be in full force and effect upon adoption.
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•
Adopted this 20th day of October;2014.
CITY OF CARMEI,ECONOMIC
DF,VE.L,OPMENT"COMMIISSION:
/ r
I suci.Stif er President.
Drew Williains, Secretary
•
•
Edward Bulcovac,Member
•
•
EXHIBIT A
DESCRIPTION OF THE PROJECTS
Demolition of existing structures, utility relocation and connection, soft soil remediation,
on-site storm water detention, on-site utilities, grading, landscaping, parking, and general site
work and site preparation, all to support a proposed mixed use development generally to be
located in the southwest quadrant of the intersection of Main Street and Old Meridian Street, in
the City of Carmel, Indiana.
INDS01 BDD 1469108v2
4
REPORT OF THE CITY OF CARMEL
ECONOMIC DEVELOPMENT COMMISSION CONCERNING
THE,PROPOSED FINANCING OF ECONOMIC DEVELOPIVIENT
FACILITIES FOR KG MAIN:LLC
The City of Carmel Economic Development Commission.(the-"Commission") preposes
to recommend to the Common Council of the City of Carmel, Indiana (the. "City"), that it
provide the proceeds of certain economic development revenue bonds to KG Main LLC or an
affiliate thereof(the "Applicant")for the financing of certain economic development facilities in
the City.
In connection therewith,the Commission hereby reports as follows:
A. The proposed economic development facilities consist of the projects
listed in,Exhibit A hereto which are located in the Old Meridian Economic Development
Area (the "Projects") which will support the Applicant's proposed mixed use
development in the City(the"Facilities").
B. The Commission estimates that no public works or services, including
public ways, schools, water, sewer, street lights and fire protection, will be made
necessary or desirable by the Projects or the.Facilities, because any such' works or
services already, exist or v,,Till,be provided"by the.Projects,themselves-or by Applicant or
other parties.
C. The Commission estimates that the total costs of financing the Projects
will be approximately$3,825,000.
• D. The Commission estimates that the Facilities and the Projects will create,
approximately 75 jobs with an estimated annual payroll of approximately$2,625,000.
E. The Commission finds that the Facilities and the Projects will not have a
material adverse competitive effect on similar facilities already 'Constructed or operating
in the City of Cannel, Indiana.
Adopted this 20th day of October,2014.
0,
Secretary, City Of Carmel.
Economic Development Commission
Attest:7>;
'-'-iProsiciptli City of Cannel
Economic Development
EXIIII3I1 A
DESCRIPTION OF THE PROJECTS
Demolition of existing structures, utility relocation and connection;soft soil rernediation,
on-site storm water detention, on-site utilities, grading, landscaping, parking, and general site
work and site preparation, all to support a proposed mixed use development generally to be
located in the southwest quadrant of the intersection of Main Street and Old Meridian Street, in
the City of-Cannel,Indiana.
INDSO1 BDD 14691090
UMBAUGH
H.J.Umbaugh&Associates
Certified Public Accountants,LLP
8365 Keystone Crossing
Suite 300
Indianapolis,IN 46240-2687
Phone:317-465-1500
Fax:317-465-1550
www.umbaugh.com
October 17, 2014
City of Carmel
do Ms.Diana Cordray
One Civic Square
Cannel, Indiana 46032
Re: Olivia On Main Allocation Area
Dear Ms. Cordray:
Enclosed please find a copy of the Tax Impact Statement that was prepared by Umbaugh on behalf of the
City of Cannel Redevelopment Commission. The Commission is required to provide an impact statement
to each of the taxing units which overlap the Olivia on Main Allocation Area including Hamilton County,
Clay Township, Cannel Civil City, Cannel-Clay School Corporation, Cannel-Clay Public Library and
Hamilton County Solid Waste Management District at least 10 days before the public hearing. The
purpose of this statement is to disclose any potential impact of establishing the Area and capturing Tax
Increment.
As described in the Tax Impact Statement, the Commission has found that the Improvements being
funded with Tax Increment will encourage development in the City. Therefore, the Commission has
determined that the capturing of the increases in assessed value from the New Development does not have
a negative impact on anticipated revenues or tax rates of the taxing units that are wholly or partially
located in the Area.
The public hearing on the proposed amendment of the Area has been scheduled by the Commission for
October 30, 2014 as set forth in the enclosed legal notice. Please let us know if you have any questions
regarding the enclosed material. If you prefer, we would be happy to meet with you to explain the
attached schedules and answer any questions that you might have.
Very truly yours,
UMBAUGH
Loren M. Matthes
CITY OF CARMEL REDEVELOPMENT COMMISSION
STATEMENT DISCLOSING THE IMPACT OF ESTABLISHING THE
OLIVIA ON MAIN ALLOCATION AREA
The City of Carmel Redevelopment Commission (the "Commission") is required by Indiana Code 36-7-
14, as amended (the "Act"), to provide a statement disclosing the impact of establishing a tax allocation
provision on the overlapping taxing units. This impact statement discloses and explains the impact on
the overlapping taxing units caused by establishing the allocation area and capturing Tax Increment (as
hereinafter defined).
ESTABLISHMENT OF THE OLIVIA ON MAIN ALLOCATION AREA AND THE 2014 PLAN
SUPPLEMENT
The Commission previously adopted resolutions (collectively, the "Original Declaratory Resolution")
establishing and expanding the Old Meridian Economic Development Area (the "Area"), designating the
Area and expansion thereto as an allocation area (as expanded, the "Old Meridian Street Allocation
Area") and approving an economic development plan for the Area (the "Original Plan"). The Area is
located within the City of Carmel, Indiana (the "City"). The Original Declaratory Resolution allows for
the capture of Tax Increment resulting from the growth in all non-residential real property assessed
value within the Area in excess of the base assessed value defined in the Act.
On August 20, 2014, the Commission adopted Resolution No. 2014-12 amending the Original
Declaratory Resolution and the Original Plan (the "Amending Declaratory Resolution") to remove a
certain area from the Old Meridian Street Allocation Area and designate such area as its own separate
allocation area, known as "The Olivia on Main Allocation Area", and to adopt a supplement to the
Original Plan (the "2014 Plan Supplement") (collectively, the "2014 Amendments"). The Amended
Declaratory Resolution allows for the capture of Tax Increment resulting from the growth in all non-
residential real property assessed value within the Olivia on Main Allocation Area in excess of the base
assessed value defined in the Act. The capture of the increases in assessed value generated in the Olivia
on Main Allocation Area shall expire no later than 25 years after the date on which the first obligation is
incurred to pay principal and interest on bonds or lease rentals on leases payable from Tax Increment.
In the Amending Declaratory Resolution, the Commission finds that the 2014 Plan Supplement for the
Economic Development Area and the Olivia On Main Allocation Area will be of public utility and
benefit because it will allow continued development of the Area. In the Amending Declaratory
Resolution, the Commission finds that the adoption of the allocation provision will result in new
property taxes in The Olivia on Main Allocation Area that would not have been generated but for the
adoption of the allocation provision.
The Original Declaratory Resolution and the Original Plan, as amended by the Amending Declaratory
Resolution and the 2014 Plan Supplement, conform to the comprehensive plan of development for the
City. The Commission finds that the 2014 Amendments are reasonable and appropriate when considered
in relation to the Original Declaratory Resolution, the Original Plan and the purposes of the Act. The
Original Plan, as supplemented by the 2014 Plan Supplement, is referred to as the "Plan".
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CITY OF CARMEL REDEVELOPMENT COMMISSION
STATEMENT DISCLOSING THE IMPACT OF ESTABLISHING THE
OLIVIA ON MAIN ALLOCATION AREA
ESTABLISHMENT OF THE OLIVIA ON MAIN ALLOCATION AREA AND THE 2014 PLAN
SUPPLEMENT (CONT'D)
Tax Increment consists of all property tax proceeds from the assessed valuation of non-residential real
property in the Area as of the assessment date in excess of the base assessed valuation described in
Section 39(b)(1) of the Act, multiplied by the current property tax rate (the "Tax Increment"). The base
assessed value means the net assessed value of all the property in an allocation area as finally
determined for the assessment date immediately preceding the effective date of a declaratory resolution
establishing the allocation area pursuant to Section 39 of the Act. The base assessment date for the
Olivia On Main Allocation Area is March 1, 2014.
PROJECT SUMMARY
In order to accomplish the Plan, the Commission intends to participate in the economic development of
the Olivia on Main Allocation Area through the construction of various improvements, including
demolition of existing structures, utility relocation and connection, soft soil remediation, excavation,
storm water detention, grading, general site work and site preparation, and other improvements (the
"Improvements") needed to support a proposed mixed use development being developed by Keystone
Corporation (the "Developer") on a 4-acre site located in the southwest quadrant of the intersection of
Main Street and Old Meridian Street in the City of Carmel. The $30 million development will include a
five story building with 200 luxury apartments atop ground-floor retail (the "New Development"). The
estimated cost of the Improvements is approximately $3.9 million, which will be funded by the
Developer, with a portion funded by Tax Increment from the New Development as described below.
Based on representations of the Developer, the Commission has determined that the New Development
will not proceed as planned without the contribution of Tax Increment to be derived from the Olivia On
Main Allocation Area to help fund the Improvements. 75% of the Tax Increment generated from the
New Development would be pledged towards the repayment of Economic Development Revenue Bonds
to be purchased by the Developer or an affiliate (the "Developer Bonds") to fund the Improvements.
25% of the Tax Increment would be available to pay other obligations of the Commission.
ESTIMATED TAX INCREMENT
The Commission intends to capture the Tax Increment from the New Development in the Olivia On
Main Allocation Area. In this analysis, the estimated assessed value from the New Development is
based on investment information provided by the Developer and the assessed value of comparable
developments throughout Hamilton County (the "County"). The estimated incremental assessed value
of$22,505,680 is multiplied by the adjusted certified 2014 tax rate of the City of Carmel taxing district
of$1.8453 (per $100 of assessed value) to calculate the estimated Tax Increment of$415,300 beginning
with taxes payable 2017. The 75% share of Tax Increment to be pledged to the Developer Bonds is
estimated to be $311,480 and the 25% share of Tax Increment is estimated to be $103,820.
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CITY OF CARMEL REDEVELOPMENT COMMISSION
STATEMENT DISCLOSING THE IMPACT OF ESTABLISHING THE
OLIVIA ON MAIN ALLOCATION AREA
ESTIMATED TAX INCREMENT (CONT'D)
The actual assessed value of the New Development will be determined by the Hamilton County
Assessor upon its completion. No adjustment for future statewide reassessments or trending was made
in this analysis. Future tax rates and assessed values may differ from the tax rates and assessed values
used in this analysis and the differences could have an impact on the actual Tax Increment. See sections
below for additional information about the recent legislative changes as they relate to property tax
changes.
Circuit Breaker Tax Credits (Property Tax Caps)
In 2007, the Indiana General Assembly enacted legislation (Indiana Code 6-1.1-20.6), which would
provide taxpayers with a tax credit for property taxes in an amount that exceeded a certain percentage of
the gross assessed value of real and personal property (the "Circuit Breaker Tax Credit") in effect
creating a property tax cap. Beginning with property taxes payable in 2010, and every year thereafter,
property taxes for homesteads are limited to 1.0% of the gross assessed value of the homestead; property
taxes for agricultural, other residential property and long term care facilities are limited to 2.0% of their
gross assessed value; and property taxes for all other real and personal property are limited to 3.0% of
gross assessed value. In November of 2010, Indiana voters passed a proposal to add the Circuit Breaker
Tax Credit to the Indiana Constitution at the 1.0%, 2.0% and 3.0% levels, with special provisions
applicable to Lake and St. Joseph Counties. Additional property tax limits have been made available to
senior citizens that meet certain income and property assessed value thresholds.
If applicable, the Circuit Breaker Tax Credit will result in a reduction of property tax collections for
each political subdivision in which the Circuit Breaker Tax Credit is applied. A political subdivision
may not increase its property tax levy or borrow money to make up for any property tax revenue
shortfall due to the application of the Circuit Breaker Tax Credit.
In this analysis, the Circuit Breaker Tax Credit is not estimated to reduce the Tax Increment due to the
fact that the current Tax Increment estimate, based on the certified pay 2014 tax rate, is below the
maximum thresholds of 2.0% and 3.0% of the gross assessed value. There can be no assurance that the
levies and tax rates of the Carmel City taxing district and the overlapping taxing units will not increase
in some future year to the point of causing the Circuit Breaker Tax Credit to be applied to non-
homestead taxpayers' tax bills.
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CITY OF CARMEL REDEVELOPMENT COMMISSION
STATEMENT DISCLOSING THE IMPACT OF ESTABLISHING THE
OLIVIA ON MAIN ALLOCATION AREA
ESTIMATED IMPACT OF ESTABLISHING THE OLIVIA ON MAIN ALLOCATION AREA
The schedule entitled "Estimated Impact of Establishing the Olivia On Main Allocation Area on the
Overlapping Taxing Units" provides an estimate of the effect on the tax rates of the overlapping taxing
units (holding all other factors constant) of establishing the Olivia On Main Allocation Area and
capturing the incremental real property assessed value.
Scenario I:Present Situation
Scenario I represents the current situation (based on payable 2014 property tax information) prior to
establishing the Olivia On Main Allocation Area. Scenario I presents the payable 2014 assessed values,
property tax levies and tax rates for the overlapping taxing units.
Scenario II:Assumes the Allocation Area is Established
Scenario II depicts the impact on the overlapping taxing units (holding all other factors constant) if the
Olivia On Main Allocation Area is established, assuming the estimated real property incremental
assessed value from the New Development is captured. The estimated $22,505,680 of real property
incremental assessed value from the New Development is estimated to generate $415,300 of Tax
Increment. 75% of the estimated Tax Increment, $311,480, would be used to repay the Developer Bonds
issued to fund the Improvements. 25% of the estimated Tax Increment, $103,820, would be available to
repay other obligations of the Commission.
Scenario III:Assumes the Allocation Area is NOT Established
Scenario III represents the impact on the overlapping taxing units if the Olivia On Main Allocation Area
is not established and assumes that the Improvements cannot be funded; therefore, the New
Development would not occur.
Impact Summary
Based on representations of the Developer, the Commission has determined that the $30 million New
Development will not proceed as planned without the contribution of Tax Increment to be derived from
the Olivia On Main Allocation Area to help fund the Improvements. 75% of the Tax Increment
generated from the New Development would be used to repay the Developer Bonds issued to fund the
Improvements. 25% of the Tax Increment would be available to pay other obligations of the
Commission.
The Commission has determined that the capture of increases in real property assessed value from the
New Development in the Olivia On Main Allocation Area will not have a negative impact on anticipated
revenues or the tax rates of the taxing units that are wholly or partially located in the Olivia On Main
Allocation Area.
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CITY OF CARMEL REDEVELOPMENT COMMISSION
STATEMENT DISCLOSING THE IMPACT OF ESTABLISHING THE
OLIVIA ON MAIN ALLOCATION AREA
Impact Summary (Cont'd)
The Commission has determined that the Improvements cannot be achieved by regulatory processes or
by the ordinary operation of private enterprise. The City has no other sources of money to pay for the
Improvements and private enterprise has historically been unwilling or unable to do so.
Please note that for purposes of estimating the impact of Tax Increment financing, certain factors were
held constant in this analysis. No other growth in real or personal property assessed value was assumed
to take place anywhere in the City or within the Area. No increases in the budgets of the overlapping
taxing units were assumed for purposes of this analysis. Potential impacts from future statewide
reassessments or trending were not included in this analysis.
ECONOMIC AND OTHER TAX IMPACTS
Additional revenue sources, which would potentially increase as a result of new business enterprises and
residents who locate in and around the Area include: motor vehicle highway funds, local road and street
funds and excise taxes. Additional local income tax revenue could be generated from new jobs or new
residents associated with the New Development. Increases in employees and/or residents, would, in turn,
increase local spending and commercial activity.
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