Revitalization Commission Agenda and Packet 2013 01 28

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SUBJECT: DELO APPLICATION FOR ASSISTANCE DATE: JANAURY 28, 2013 PAGE 4 OF 5 Costs not included in this scope include; • Private streets identified by DELO in the northern portion of the property, • Added landscaping outside the traditional treatments required by the City, • The plaza identified along Cannon Street • Street reconstruction of Lafayette • Traffic control on Short and Highway 42 (safe crossing funds acquired by City) Public Works staff estimates the cost of the new streets and sidewalks and needed utilities is $2,900,000. More detailed design is required to more accurately identify these costs. RECOMMENDATION: The LRC provided general direction at the January 14, 2013 meeting to take a site specific approach in evaluating the level of investment a project may be eligible for Urban Renewal assistance. The Commission was open to creating a subarea including properties adjacent to improved streets be included where the TIF generated will contribute to the payment of debt needed to complete the needed infrastructure. This area is generally defined as the property inside the boundaries of Highway 42, South Street, the BNSF railroad, and Griffith Street. Staff revised the revenue projections to include all the property within this subarea and made the following assumptions to determine increased revenue: 1. The DELO project would be valued as described above. 2. The Tebo property between South and Short would be redeveloped into a 45,000 sf retail building valued at $75 per building square foot. 3. Other properties would not redevelop but increase in value by 30% due to having new streets serving them. Assuming a 19 year life remaining for the Urban Renewal District, the LRC needing to obtain debt from private investors at 8% interest, and the subarea changing in value as described above, staff concluded anticipated revenues from the subarea can support a debt of $2,900,000 towards the construction of needed infrastructure within the subarea. Staff is recommending the LRC provide direction to staff that it is willing to provide public infrastructure, a willingness to borrow for the costs of the infrastructure, and the revenues to pay back the borrowing come from properties within the boundaries of Highway 42, South Street, BNSF railroad, and Griffith Street. ACTION STEP: The action step for the LRC is to provide direction for the scope of the infrastructure to be provided in the Revitalization Area, a willingness to borrow for the costs of the infrastructure, and the revenues to pay back the borrowing come from properties within the boundaries of Highway 42, South Street, BNSF railroad, and Griffith Street. LOUISVILLE REVITALIZATION COMMISSION