Memorandum

City of Lawrence

City Manager’s Office

TO:	David L. Corliss, City Manager
FROM:	Diane Stoddard, Assistant City Manager
CC:	Cynthia Wagner, Assistant City Manager
Date:	July 23, 2012
RE:	Transcripts for Downtown 2000 TIF Project

There have been some questions about the existing TIF district in the 900 block of New Hampshire regarding the original projected amount of city-at-large versus TIF district revenue.  Also, there have been some questions raised regarding the amount of TIF revenue that would be raised if the hotel project proceeded at 900 New Hampshire and the parcel remained within the current TIF.  This memorandum will address these issues.

Attached is the Transcript of Proceedings for the 900 New Hampshire Project, the TIF created in 2000.  The TIF project was never anticipated to cover 100% of the costs related to the parking garage and infrastructure improvements.  In fact, the documents suggest that only 50% to 60% of the City-at-large funding was to be reimbursed from TIF proceeds.  Page 8 of the feasibility report, located on page 60 of the transcript notes:

“As was noted in the Redevelopment Plan, the City anticipated using property tax-supported general obligation bonds to finance a significant portion of the parking facility and other related infrastructure.  Therefore, the public improvements proposed for the Project Area are to be funded with general obligation bonds supported by tax increments and general property taxes.  The removal from the property tax base of four lots for the City-owned Lawrence Arts Center facility also impacts the necessity of City-at-large funding for this project.” 

Also, pages 16-17 of the Redevelopment Plan, located on pages 114-115 of the transcript, demonstrates that 60% of the costs were projected to be covered by TIF revenues if a hotel were placed on the 900 New Hampshire parcel, but only 50% were projected to be covered if the development were not a hotel. 

As has been noted previously, the original projections for the TIF project did not come to fruition due to lack of redevelopment of the parcels along the original timeline.  As a result, , $316,025 in property tax TIF revenue has been collected through 2011.  With no further development within the district, the projected 20 year revenue would be approximately $2.5 million out of the originally projected $4.1 million in property tax TIF revenue (as presented in the Springsted Feasibility Analysis dated February 23, 2000, scenario presented did not include a hotel).

Property Tax TIF Revenue
	Total through 2011	Projected 2012- 2020	Total
900 NH	$4,483	$7,136	$11,619
901 NH	$16,805	$1,685,974	$1,702,779
947 NH	$294,738	$469,516	$764,254
Total	$316,026	$2,162,626	$2,478,652

Note the above numbers are based solely on property tax TIF revenue. TIF sales tax revenues could not be examined due to state confidentiality regulations.

There have been questions regarding what would be the amount of TIF revenue raised on the 900 New Hampshire site if a hotel were developed on the parcel and the property remained in the current TIF district.  Based upon estimates in Springsted’s 4-Story Need for Assistance Analysis Report, the annual TIF revenue projected from the proposed development is $155,784 in ad valorem property taxes and $142,270 from sales taxes for a total of $298,054 per year.  Assuming 5 years of collection before the current TIF expires, this would generate approximately $1.5 million in TIF increment.  Of course, this scenario assumes that a project would be built without assistance and without creating a new TIF district.