Revitalization Commission Agenda and Packet 2020 09 09

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SUBJECT: 2021 PRELIMINARY BUDGET DATE: SEPTEMBER 9, 2020 PAGE 2 OF 3 • The LRC has previously committed to two City of Louisville capital projects that will carry forward into 2021: Undergrounding ($170,000) and Downtown Lights ($142,000). • Under the Tri-Party Agreement, the URD is required to remit 7.15% of net property tax revenue back to Boulder County. The 2020 budget for this item was $138,140. • The LRC and City Council executed an agreement for revenue sharing with the Louisville Fire Protection District in 2020. The first payment required under that agreement will be made in Q1 2021. Per the agreement terms, the 2020 budget for this item was $51,710. • Bond Maintenance Fees are charged by the Paying Agent for the 2014 Property Tax Increment Revenue Bonds (2020, $7,150). Investment Fees include fees charged by USBank to maintain the DELO Construction Account and fees charged by the City of Louisville's Investment Advisor for funds on deposit at the City (2020, $3,500). In 2019, the Professional Services "Other" line item was used to budget for up to two third -party reviews, which are required in proposed agreements for direct financial assistance at a cost of $20,000. Given the LRC's new policy to pay for 50% of these reviews up -front, it is likely this item could be reduced to $12,000 for the 2021 budget. Payments from the DELO Construction Account are disbursements made by USBank at the URD's request. These are disbursements from the 2014 Property Tax Increment Revenue Bond proceeds, the owner's funds, and the City's storm drainage contributions for the benefit of the DELO Construction Project. In 2020, the LRC budgeted $315,000 in line with the remaining account amount. Please recall that the 2014 Property Tax Increment Revenue Bonds are accretion and cash flow bonds issued in the amount of $4.5 million. Under this bond structure, the URD calculates an annual amount of "pledged revenue" and deposits it with the Paying Agent. The pledged revenue calculation is defined in the Bond Resolution. If the annual calculation does not cover all interest due, the remaining interest is compounded as accreted interest. With assistance from Bond Counsel in 2019, City staff reviewed how the pledged revenue was calculated, based on definitions within the Bond Resolution. Last year, that resulted in a greater amount of required pledged revenue. Staff has since incorporated that adjusted calculation into budget projections. The 2020 the LRC budgeted $347,000 in principal and $329,950 in interest payments. Staff will continue to incorporate that adjusted calculation in the 2021 preliminary budget. Agenda Packet P. 13