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20/8/2024 the time is 6:00 PM. 00:00:00
It's OK. 00:00:08
All right. Is that working? 00:00:17
Today is August 28th, 2024. The time is 6:00 PM. It's Wednesday and we are going to start our Redevelopment Agency board meeting. 00:00:21
We're going to start out with an invocation and the Pledge of Allegiance by Council Member Cameron. 00:00:29
Our dear Father in heaven, we come before Thee this evening to ask for Thy Spirit to be with us as we hold this meeting and pray 00:00:42
that they will help us to be mindful of. 00:00:47
The needs of the citizens and that will be considerate of each other and that we'll work together. 00:00:53
For the best of this community, we love thee and are grateful for all the blessings and abundance that surround us. And we say 00:01:00
these things in the sacred name of Jesus Christ, Amen. Amen. 00:01:05
I pledge allegiance to the flag of the United States of America and to the Republic for which it stands, one nation under God, 00:01:15
indivisible, with liberty and justice for all. 00:01:22
All right, we'll move on to our consent agenda. I need a motion. 00:01:31
I move to approve consent items as presented. OK, we have a first by Amber. Can I get a second? 00:01:38
Second Second by Sarah. Any discussion? 00:01:44
All in favor, aye? 00:01:48
All right, that brings us to 3.1, our RDA update and our RDA Director, Josh Daniels will give us a. 00:01:51
On the RDA. Thanks. 00:01:59
Good evening council members. Well board members, do we have the can I get the little? 00:02:03
Yeah, thanks. 00:02:11
So I just have been doing some financial research that I think will help to answer some questions that have been raised over the 00:02:16
course of several weeks. And then also if there are, if there are additional questions, we could maybe spend a few minutes, I 00:02:22
could you know, spend a few minutes responding to them. 00:02:27
Let me pull open our presentation here. 00:02:34
It's just taking a little bit of time. 00:02:52
There we go. 00:03:08
OK, so a couple of points. 00:03:15
First of all, since the beginning of the use of increment within the project area of the RDA, which phases were first triggered in 00:03:18
2017, the cumulative total increment revenue that's been collected and paid to the RDA is just over is, you know, 76 and a half 00:03:27
million. 00:03:35
The bulk of that is spent on a reimbursement basis. 00:03:46
To those contractors and developers that are doing work in the project area on environmental remediation as well as. 00:03:50
City infrastructure, roads and, and get curb and gutter and sewer and some of those sorts of things. That's, that's really where 00:04:01
the bulk of those dollars are spent and it's really where the bulk of the dollars will be spent over the lifetime of of the 00:04:07
existence of the project area for the RDA. 00:04:12
Now a questions kind of come up about the fiscal impact on the Alpine School District. So I just wanted to review the theory of 00:04:20
why the school districts around the state will agree to participate in increment, which is to essentially give up revenue for a 00:04:28
period of time. And it's because you're talking about land that is not valuable. 00:04:36
But that if this investment is made, the the land will become more valuable and then in the long run, the school district will 00:04:45
actually receive more total tax revenue over time. 00:04:50
And so I've got some data I want to share with you that will kind of show that. But just as a summation point, to date the Alpine 00:04:55
school districts share of that 76,000,000 is 39, just under 40 million. So it's about 52% of the revenue I. 00:05:04
Comes from the Alpine School District share, which makes sense. Alpine School District makes up, you know, 50%. Actually a little 00:05:13
more of all tax revenues collected. You know, when people pay property tax, over 50% is going to the school district. That's the 00:05:19
largest user of property tax revenues. The city's share is 2020 million and again, that's over the course of time since 2017 00:05:26
cumulative. 00:05:32
I I think there's been some misunderstanding about the payment of property taxes. All properties in the city, in the RDA, in the 00:05:40
project area, all properties are being assessed property taxes at the current property tax rates that everybody has to pay. So no 00:05:49
land owner is given any kind of special treatment. 00:05:58
You know, unless they have, you know, some sort of an exemption. 00:06:07
Which there are certain things, certain property owners might have certain exemptions, of course, there's like Greenbelt and those 00:06:11
kinds of things, but outside of those, normal. 00:06:15
Programs all land owners, including the developers that own, you know, a good chunk of the project area, they are paying property 00:06:20
taxes on all those properties that they own. 00:06:26
And at those current rates and so the property tax revenue that is then collected a share of that property tax is then potentially 00:06:33
rebated back in the case of let's say a developer doing work on a reimbursement basis as they are spending money to build 00:06:40
infrastructure. But then you know those that 75% share, that's the increment that goes to the RDA and the RDA then pays that out 00:06:48
on a reimbursement basis. Another important principle that I. 00:06:55
Sometimes isn't well understood is that in Utah generally and specifically in the case of the Geneva project area and this RDA, 00:07:03
all of the agreements to to spend tax increment financing funds are post performance. There are other states where economic 00:07:10
development and tax increment financing might be used in some sort of a subsidization basis to incentivize things. That's not 00:07:18
really the approach. 00:07:25
That we've taken, the approach that we take is post performance. So it's not really an incentive. I mean, it does incent people to 00:07:33
do things, but people are only paid once they've actually created something and done their end of the bargain. In this case, you 00:07:40
know, performed certain environmental cleanup projects that they've expended funds to do or actually built certain infrastructure 00:07:48
projects that they then get reimbursed for after. 00:07:55
Fact so why that's important is the city wins because the city gets the infrastructure 1st and the developer in a sense is acting 00:08:03
like. 00:08:08
An investor or a bondholder or but they're taking the risk and so they're fronting the city a street in the hopes that the city 00:08:15
will then collect sales tax or property tax revenue through the increment that's sufficient to pay them back. 00:08:24
And so they're taking risk with their dollars today to build infrastructure and they're on the hook essentially to finance it. And 00:08:34
then they get reimbursed once they've once they've done the performance. Now that's a really great model because the city doesn't 00:08:41
have a whole lot of risk in that environment. And you get streets and other kinds of infrastructure and the environmental cleanup 00:08:47
up front rather than maybe a traditional model. 00:08:54
Where you have to bond for something, get the money. 00:09:00
Then go out and build the road and you're not going to be able to bond if you're not able to demonstrate certain revenues in that 00:09:03
moment as you're trying to qualify or or yeah, basically qualify for that bond. 00:09:11
And so this particular feature that we're as a city able to utilize is a is a great advantage because you're able to build a lot 00:09:19
of infrastructure quickly and therefore able to build out the city fairly quickly with, you know, housing and, and other kinds of 00:09:25
projects. 00:09:32
So any questions before I jump into the next charter graph about any of those points? Yeah, I have a question. 00:09:40
So we met myth with. 00:09:46
And he mentioned that the Forge, we did a lot of the infrastructure first thinking that they were going to go ahead. And so is 00:09:50
that different than a TIF fund? Like why did we do that? And they haven't done anything with the land yet. 00:09:57
So you're saying this this city spent money to build the infrastructure? Yeah. I mean, that's in that scenario. I wasn't around at 00:10:04
the time, you know why that was maybe the idea. But I mean, you could do that, right? You could build infrastructure in hopes that 00:10:11
it would attract development. Maybe. I don't know if the mayor has more insight as to why. Yeah. So the roads that were put in 00:10:19
served both sites. So it was infrastructure to service the whole area and then. 00:10:26
The idea was that they were going to come in and build and the yard was going to come in and build. So I believe there's a lift 00:10:34
station, mill roads and things like that. That equaled about $4 million in total. 00:10:39
I think there was about 600,000 specific to that site, but it was to service the whole area. And so we've seen growth on one side 00:10:44
and then on the other side has not yet performed, but that's why it is. It's a similar thing that happened in the yard where we 00:10:52
put in the cleanup or the water infrastructure so that they could build on the site. And rarely do we do upfront funding. It's 00:10:59
usually a very small amount, but this one in particular was to service the entire. 00:11:07
Area SO. 00:11:14
OK. 00:11:19
Any other snow? 00:11:21
All right. 00:11:22
OK, so. 00:11:25
Here's a chart that will show why. 00:11:27
The investment in the utilization of increment financing to help development, why that might make sense and probably what the 00:11:31
school district was thinking when they chose to participate, you know, voting to participate 15 years ago. So here you have two 00:11:41
lines going all the way back to when the project area just slightly before the project area was first designated and the. 00:11:51
The RDA was created and the increment financing was approved, which are activities that took place between 2009 and 2014. 00:12:01
And so the real work of actually doing the environmental remediation and working on development and the creation of infrastructure 00:12:11
began in earnest after 2014. And So what this chart shows is it shows the value of all property within the project area of the RDA 00:12:18
in blue. 00:12:25
And it shows the value of all other property in the city of Vineyard that is not within the project area. 00:12:33
And the thing that's interesting to look at in the chart is the differences in the slope of the line, which is the rate of 00:12:43
increase of the value of the land. And So what you see is that once the investment in the development, environmental cleanup and 00:12:53
infrastructure of the area, the project area begins, you see a real significant increase in the value of that land. 00:13:03
Versus the value of the other land that's not in the project area and so. 00:13:15
What that's showing you is that the the net effect of the upfront and well, not upfront, but it was upfront investment on the part 00:13:21
of developers. But the net effect of that upfront development for them, which they're incentivized to do because there's a 00:13:28
reimbursement agreement that they have increases the value of the land faster than land that is not that is not undergoing that 00:13:36
same type of investment. Now granted some of the areas in the red are sort of already built. 00:13:43
Out. So you're just looking at maybe appreciation versus land that's fallow, that's being built on, right. So that also makes 00:13:51
sense as to why there would be a steeper line and faster growth. But because of that, so the question is how fast can we make land 00:14:00
that is blighted and like the former Geneva site, how fast can we make that land more valuable for the purpose of tax revenue? 00:14:09
That's what the school district is wondering because. 00:14:19
And that's what every tax entity is wondering is they're saying, well, if nothing happens on this property, it will remain not so 00:14:22
valuable and we will not receive very much tax revenue. But if, if we can invest in making, you know, developing this land, 00:14:30
increasing its taxable value quickly, we will get more property tax revenue both in the near term and over the long term. And that 00:14:37
is the reason that taxing entities choose to participate in giving up some of their property tax revenues for a period of. 00:14:44
Time so that it can accelerate the development of that land, that blighted land and and then they can have that that pay off, 00:14:52
which is that they'll receive tax revenues quickly that they wouldn't have otherwise received. And over the long term, they'll 00:15:00
also receive more revenue and, and on a faster timeline. So now to actually look at that, I've got this other chart and these are 00:15:07
the two main charts I wanted to show before I switch the other chart. 00:15:15
Questions about this? 00:15:22
OK. So now this is just using the school district as an example. You could also look at Vineyard if you wanted as well. But since 00:15:26
they're the biggest and they're the ones that have come up in conversation, I'm using them as an example. So this is the revenue, 00:15:32
the tax revenue to Alpine School District that is collected from within the project area. So those are those are properties that 00:15:38
might be subject to the tax increment financing, which means a portion of those revenues are going to the RDA and not to the 00:15:43
school district. 00:15:49
And that's versus those non RDA properties in Vineyard? 00:15:56
So here's an important thing to think about if we go back to 2009. 00:16:01
We see that the total amount of annual property tax revenue that's collect, that's what this is, this is annual property tax 00:16:08
revenue. This is the actual revenue that Alpine School District actually receives, including the haircut that happens when, when 00:16:15
tax revenues are sent to the RDA and not to the school district, that's the increment revenue. So if you go back to 2009, you can 00:16:23
see there's it's pretty close between the project. 00:16:30
Area tax revenue and the rest of Vineyard. 00:16:38
But then if you look to the very last line, the blue line at the very end in 2024, so these are RDA properties, you can see that 00:16:42
Alpine School District today is receiving more revenue from just the RDA properties where they're only receiving 25% of the 00:16:50
revenue there was. So they're 25%. 00:16:57
Is more than they were receiving from both all of Vineyard and the project area combined in 2009. 00:17:05
And so and so that, so if you follow the blue line, you notice that it goes up because that's appreciation and property values 00:17:14
that's happening plus some development because there were neighborhoods being built in Vineyard that were built within the project 00:17:20
area. And so that's contributing to the increase in the blue line until you hit 2016. And then what happens is after 2016 when you 00:17:27
get to year 2017. 00:17:34
Some of the first phases, the 1st 3 phases of the RDA were triggered. 00:17:41
Meaning that 75% of the property tax revenue that would have gone to the school district now goes to the RDA instead. So you see a 00:17:46
drop in the revenue that's expected, but then what happens is the school district is now only receiving 25% of the revenue they 00:17:56
would have received previously. And that 25% share increases over time as the whole project area is being developed and so. 00:18:05
This this is exactly why. 00:18:15
School districts will participate is they know that while they'll take a haircut in the short term, they'll be back to where they 00:18:18
were before and far beyond that. 00:18:22
And so that's kind of what this what this chart shows. And in in both cases, you can see the blue line is pretty steep in the 00:18:27
beginning, which shows the value of just building neighborhoods. But you also another reason those lines are steep is you're 00:18:34
coming out of a recession at that time as well. And so property values were going up. 00:18:41
More than they might otherwise go up just naturally. 00:18:48
I know it's kind of complicated. There's a lot of moving parts on this chart that's it represents a whole lot of data. 00:18:52
But I tried to simplify it so that you can kind of see some comparisons. So any any questions about that? 00:18:58
It's OK, you can kind of Stew on it if you want, but. 00:19:14
I don't think we have questions. It's good, OK. 00:19:17
OK, let me think here. I think there was one other. 00:19:23
One other thing, Oh no, I was going to maybe revisit the taxing entity question that we had discussed in a previous meeting, but 00:19:28
we really did I think hammer that issue pretty well, which is that the taxing entity committee exists kind of as needed one off. 00:19:35
It's not a continuing entity. It exists for the purpose of bringing together these participating taxing entities like the school 00:19:42
districts to approve their participation initially in opting into the the tax. 00:19:50
OK. Thank you all. 00:20:01
Thank you, I honestly really appreciate it. 00:20:05
I would just say that I mean, in the most not kindest terms, I think this is a manipulation of data and I don't think it 00:20:12
represents. I mean, obviously if I were to. 00:20:18
We need to be very clear with our words that. 00:20:24
When we say that they pay taxes, they pay taxes. 00:20:27
But then it's remitted back to them in January, right? 00:20:31
So it's a kind of a play on words. 00:20:36
No, so they pay taxes so like, like using the example of a developer, right, right. So if you have a developer in the project area 00:20:38
that owns property, they're paying all the property taxes that they would that any property owner would normally pay based on the 00:20:45
value of the land which the value of a lot of the land that is still undergoing environmental remediation is quite low. It and it 00:20:53
and I believe it actually qualifies essentially for the same type of treatment as a as a Greenbelt, but. 00:21:00
Nonetheless, they pay those taxes. 00:21:08
Then what happens is not in January, but at the at whatever time is appropriate based on invoicing and based on contract, you 00:21:10
know, contractual agreements, the RDA pays them per a separate contract. That has nothing to do with how you know what they paid 00:21:17
in taxes. It's like they have a specific contract. If they do this project or that project that they're working on this or that, 00:21:23
then they're reimbursed. 00:21:30
A certain amount of money per the contract. 00:21:37
What I'm saying though, is how amazing it would be if, let's say, my landscaping wasn't done because it's done now. 00:21:40
And I paid taxes like a normal person and then I had a blighted area and it's like I got that back because then therefore it would 00:21:47
improve the value of my property. That's what we're doing right, is it's a special area where only 50% of the properties are 00:21:54
getting that and we're hoping that it will increase in value. 00:22:00
And I get it, we're not going to convince each other tonight on where we stand, but I just think it's incredible to look at how 00:22:09
data can be used to show one thing and the exact same data can show the other. 00:22:15
And so I don't want to belabor the point tonight, but I do think that if we're giving one side of the argument a voice to do it, I 00:22:22
think that those specialists that are of the other voice should be, have the ability to come on the agenda and teach the other 00:22:28
side of things. Josh, do you see another side of things that you would feel comfortable? I, I guess I'm not understanding 00:22:35
completely. 00:22:42
What what your goals are with the well, I mean, we're coming to do the same exact presentation to kind of belabor the point. And 00:22:49
it's like I think if we're trying to sell us on. 00:22:55
Locking everybody into the what, 2011 tax rate and allowing them to do that and then saying, oh, but they're really not getting it 00:23:03
back. But they're getting it back in a different way. I mean, they are. It's just kind of a, a play on words. And I, I mean that 00:23:08
in the nicest way, but it's just. 00:23:13
Everyone went through the tax comparison to see that it's not functioning like we're not getting. 00:23:19
You know what, the 70 million that we've pushed back, I don't think we've gotten the 70 million back. 00:23:25
Who are hoping in the future it would be but it hasn't come to fruition yet right but you didn't in total revenue but what's your 00:23:32
I guess so you're saying that you're worried that this is like a sales pitch right and so. 00:23:38
Which is great. I mean, we all want the RDA to be successful, right? Well, for me, I'm looking at numbers. 00:23:45
And so I don't, I don't necessarily feel it's a sales pitch as much as trying to understand how the RDA works. And so I guess. 00:23:51
I think more importantly, it would be good at some point I would really like to understand your concerns and what your goals are 00:23:59
with your concerns. There are there are professional sort of sat down with us. Well, I mean, I have a lot of faith in our RDA 00:24:06
director. I mean, he has a really impressive resume. Yeah. May I just interrupt and say I can't speak for the rest of the council, 00:24:12
but I don't believe been you've been manipulative. I appreciate you bringing the data. No, I'm not done. 00:24:19
And correct me if I'm wrong is that. 00:24:56
We are just providing the algorithm or the calculation by how? 00:24:59
We provide taxation with the RDA. It's not a opinion, it is just a calculation and it's done according to the RDA flaws that are 00:25:05
in place. And that's what we are discussing. And so I think we can find clarity in it. We can post it, we can send you guys all of 00:25:14
that information. But let's go ahead and move on to the next point. I would just marry the two comments, right, So you have. 00:25:23
39 million. 00:25:33
That didn't go to schools. And then you have the 20 million that that came in, right? So you have a total of 60 million. In your 00:25:35
last meeting, Josh, you showed that, hey, the property of X Mission went from what was it 8 to 6000 to 46,000 or something like 00:25:42
that. I mean, so it's like, hey, we saw 30,000% increase in property value. And it's like, right, That 36,000 is much smaller than 00:25:49
the 40 million right now. That's only one year. 00:25:55
But still, that's a small increment for. 00:26:03
Will it actually pay back? And so I just think modeling, and I'm not saying Josh is manipulating the numbers and you can 00:26:06
manipulate data to look at different things to to show out different things. I think everyone knows that. And I just wanted to 00:26:11
point that out that I think it's important that the RDA. 00:26:17
Get second and third opinions. And we do, we actually work with financial advisors that look at all of these numbers and they're 00:26:23
very well known in the state. And I think we've presented data that is very clear tonight. So Josh, if you don't have anything 00:26:30
else, is that the end of your update? OK, I'm adjourning this meeting and we'll move on to our next meeting in about 10 minutes. 00:26:37
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20/8/2024 the time is 6:00 PM. 00:00:00
It's OK. 00:00:08
All right. Is that working? 00:00:17
Today is August 28th, 2024. The time is 6:00 PM. It's Wednesday and we are going to start our Redevelopment Agency board meeting. 00:00:21
We're going to start out with an invocation and the Pledge of Allegiance by Council Member Cameron. 00:00:29
Our dear Father in heaven, we come before Thee this evening to ask for Thy Spirit to be with us as we hold this meeting and pray 00:00:42
that they will help us to be mindful of. 00:00:47
The needs of the citizens and that will be considerate of each other and that we'll work together. 00:00:53
For the best of this community, we love thee and are grateful for all the blessings and abundance that surround us. And we say 00:01:00
these things in the sacred name of Jesus Christ, Amen. Amen. 00:01:05
I pledge allegiance to the flag of the United States of America and to the Republic for which it stands, one nation under God, 00:01:15
indivisible, with liberty and justice for all. 00:01:22
All right, we'll move on to our consent agenda. I need a motion. 00:01:31
I move to approve consent items as presented. OK, we have a first by Amber. Can I get a second? 00:01:38
Second Second by Sarah. Any discussion? 00:01:44
All in favor, aye? 00:01:48
All right, that brings us to 3.1, our RDA update and our RDA Director, Josh Daniels will give us a. 00:01:51
On the RDA. Thanks. 00:01:59
Good evening council members. Well board members, do we have the can I get the little? 00:02:03
Yeah, thanks. 00:02:11
So I just have been doing some financial research that I think will help to answer some questions that have been raised over the 00:02:16
course of several weeks. And then also if there are, if there are additional questions, we could maybe spend a few minutes, I 00:02:22
could you know, spend a few minutes responding to them. 00:02:27
Let me pull open our presentation here. 00:02:34
It's just taking a little bit of time. 00:02:52
There we go. 00:03:08
OK, so a couple of points. 00:03:15
First of all, since the beginning of the use of increment within the project area of the RDA, which phases were first triggered in 00:03:18
2017, the cumulative total increment revenue that's been collected and paid to the RDA is just over is, you know, 76 and a half 00:03:27
million. 00:03:35
The bulk of that is spent on a reimbursement basis. 00:03:46
To those contractors and developers that are doing work in the project area on environmental remediation as well as. 00:03:50
City infrastructure, roads and, and get curb and gutter and sewer and some of those sorts of things. That's, that's really where 00:04:01
the bulk of those dollars are spent and it's really where the bulk of the dollars will be spent over the lifetime of of the 00:04:07
existence of the project area for the RDA. 00:04:12
Now a questions kind of come up about the fiscal impact on the Alpine School District. So I just wanted to review the theory of 00:04:20
why the school districts around the state will agree to participate in increment, which is to essentially give up revenue for a 00:04:28
period of time. And it's because you're talking about land that is not valuable. 00:04:36
But that if this investment is made, the the land will become more valuable and then in the long run, the school district will 00:04:45
actually receive more total tax revenue over time. 00:04:50
And so I've got some data I want to share with you that will kind of show that. But just as a summation point, to date the Alpine 00:04:55
school districts share of that 76,000,000 is 39, just under 40 million. So it's about 52% of the revenue I. 00:05:04
Comes from the Alpine School District share, which makes sense. Alpine School District makes up, you know, 50%. Actually a little 00:05:13
more of all tax revenues collected. You know, when people pay property tax, over 50% is going to the school district. That's the 00:05:19
largest user of property tax revenues. The city's share is 2020 million and again, that's over the course of time since 2017 00:05:26
cumulative. 00:05:32
I I think there's been some misunderstanding about the payment of property taxes. All properties in the city, in the RDA, in the 00:05:40
project area, all properties are being assessed property taxes at the current property tax rates that everybody has to pay. So no 00:05:49
land owner is given any kind of special treatment. 00:05:58
You know, unless they have, you know, some sort of an exemption. 00:06:07
Which there are certain things, certain property owners might have certain exemptions, of course, there's like Greenbelt and those 00:06:11
kinds of things, but outside of those, normal. 00:06:15
Programs all land owners, including the developers that own, you know, a good chunk of the project area, they are paying property 00:06:20
taxes on all those properties that they own. 00:06:26
And at those current rates and so the property tax revenue that is then collected a share of that property tax is then potentially 00:06:33
rebated back in the case of let's say a developer doing work on a reimbursement basis as they are spending money to build 00:06:40
infrastructure. But then you know those that 75% share, that's the increment that goes to the RDA and the RDA then pays that out 00:06:48
on a reimbursement basis. Another important principle that I. 00:06:55
Sometimes isn't well understood is that in Utah generally and specifically in the case of the Geneva project area and this RDA, 00:07:03
all of the agreements to to spend tax increment financing funds are post performance. There are other states where economic 00:07:10
development and tax increment financing might be used in some sort of a subsidization basis to incentivize things. That's not 00:07:18
really the approach. 00:07:25
That we've taken, the approach that we take is post performance. So it's not really an incentive. I mean, it does incent people to 00:07:33
do things, but people are only paid once they've actually created something and done their end of the bargain. In this case, you 00:07:40
know, performed certain environmental cleanup projects that they've expended funds to do or actually built certain infrastructure 00:07:48
projects that they then get reimbursed for after. 00:07:55
Fact so why that's important is the city wins because the city gets the infrastructure 1st and the developer in a sense is acting 00:08:03
like. 00:08:08
An investor or a bondholder or but they're taking the risk and so they're fronting the city a street in the hopes that the city 00:08:15
will then collect sales tax or property tax revenue through the increment that's sufficient to pay them back. 00:08:24
And so they're taking risk with their dollars today to build infrastructure and they're on the hook essentially to finance it. And 00:08:34
then they get reimbursed once they've once they've done the performance. Now that's a really great model because the city doesn't 00:08:41
have a whole lot of risk in that environment. And you get streets and other kinds of infrastructure and the environmental cleanup 00:08:47
up front rather than maybe a traditional model. 00:08:54
Where you have to bond for something, get the money. 00:09:00
Then go out and build the road and you're not going to be able to bond if you're not able to demonstrate certain revenues in that 00:09:03
moment as you're trying to qualify or or yeah, basically qualify for that bond. 00:09:11
And so this particular feature that we're as a city able to utilize is a is a great advantage because you're able to build a lot 00:09:19
of infrastructure quickly and therefore able to build out the city fairly quickly with, you know, housing and, and other kinds of 00:09:25
projects. 00:09:32
So any questions before I jump into the next charter graph about any of those points? Yeah, I have a question. 00:09:40
So we met myth with. 00:09:46
And he mentioned that the Forge, we did a lot of the infrastructure first thinking that they were going to go ahead. And so is 00:09:50
that different than a TIF fund? Like why did we do that? And they haven't done anything with the land yet. 00:09:57
So you're saying this this city spent money to build the infrastructure? Yeah. I mean, that's in that scenario. I wasn't around at 00:10:04
the time, you know why that was maybe the idea. But I mean, you could do that, right? You could build infrastructure in hopes that 00:10:11
it would attract development. Maybe. I don't know if the mayor has more insight as to why. Yeah. So the roads that were put in 00:10:19
served both sites. So it was infrastructure to service the whole area and then. 00:10:26
The idea was that they were going to come in and build and the yard was going to come in and build. So I believe there's a lift 00:10:34
station, mill roads and things like that. That equaled about $4 million in total. 00:10:39
I think there was about 600,000 specific to that site, but it was to service the whole area. And so we've seen growth on one side 00:10:44
and then on the other side has not yet performed, but that's why it is. It's a similar thing that happened in the yard where we 00:10:52
put in the cleanup or the water infrastructure so that they could build on the site. And rarely do we do upfront funding. It's 00:10:59
usually a very small amount, but this one in particular was to service the entire. 00:11:07
Area SO. 00:11:14
OK. 00:11:19
Any other snow? 00:11:21
All right. 00:11:22
OK, so. 00:11:25
Here's a chart that will show why. 00:11:27
The investment in the utilization of increment financing to help development, why that might make sense and probably what the 00:11:31
school district was thinking when they chose to participate, you know, voting to participate 15 years ago. So here you have two 00:11:41
lines going all the way back to when the project area just slightly before the project area was first designated and the. 00:11:51
The RDA was created and the increment financing was approved, which are activities that took place between 2009 and 2014. 00:12:01
And so the real work of actually doing the environmental remediation and working on development and the creation of infrastructure 00:12:11
began in earnest after 2014. And So what this chart shows is it shows the value of all property within the project area of the RDA 00:12:18
in blue. 00:12:25
And it shows the value of all other property in the city of Vineyard that is not within the project area. 00:12:33
And the thing that's interesting to look at in the chart is the differences in the slope of the line, which is the rate of 00:12:43
increase of the value of the land. And So what you see is that once the investment in the development, environmental cleanup and 00:12:53
infrastructure of the area, the project area begins, you see a real significant increase in the value of that land. 00:13:03
Versus the value of the other land that's not in the project area and so. 00:13:15
What that's showing you is that the the net effect of the upfront and well, not upfront, but it was upfront investment on the part 00:13:21
of developers. But the net effect of that upfront development for them, which they're incentivized to do because there's a 00:13:28
reimbursement agreement that they have increases the value of the land faster than land that is not that is not undergoing that 00:13:36
same type of investment. Now granted some of the areas in the red are sort of already built. 00:13:43
Out. So you're just looking at maybe appreciation versus land that's fallow, that's being built on, right. So that also makes 00:13:51
sense as to why there would be a steeper line and faster growth. But because of that, so the question is how fast can we make land 00:14:00
that is blighted and like the former Geneva site, how fast can we make that land more valuable for the purpose of tax revenue? 00:14:09
That's what the school district is wondering because. 00:14:19
And that's what every tax entity is wondering is they're saying, well, if nothing happens on this property, it will remain not so 00:14:22
valuable and we will not receive very much tax revenue. But if, if we can invest in making, you know, developing this land, 00:14:30
increasing its taxable value quickly, we will get more property tax revenue both in the near term and over the long term. And that 00:14:37
is the reason that taxing entities choose to participate in giving up some of their property tax revenues for a period of. 00:14:44
Time so that it can accelerate the development of that land, that blighted land and and then they can have that that pay off, 00:14:52
which is that they'll receive tax revenues quickly that they wouldn't have otherwise received. And over the long term, they'll 00:15:00
also receive more revenue and, and on a faster timeline. So now to actually look at that, I've got this other chart and these are 00:15:07
the two main charts I wanted to show before I switch the other chart. 00:15:15
Questions about this? 00:15:22
OK. So now this is just using the school district as an example. You could also look at Vineyard if you wanted as well. But since 00:15:26
they're the biggest and they're the ones that have come up in conversation, I'm using them as an example. So this is the revenue, 00:15:32
the tax revenue to Alpine School District that is collected from within the project area. So those are those are properties that 00:15:38
might be subject to the tax increment financing, which means a portion of those revenues are going to the RDA and not to the 00:15:43
school district. 00:15:49
And that's versus those non RDA properties in Vineyard? 00:15:56
So here's an important thing to think about if we go back to 2009. 00:16:01
We see that the total amount of annual property tax revenue that's collect, that's what this is, this is annual property tax 00:16:08
revenue. This is the actual revenue that Alpine School District actually receives, including the haircut that happens when, when 00:16:15
tax revenues are sent to the RDA and not to the school district, that's the increment revenue. So if you go back to 2009, you can 00:16:23
see there's it's pretty close between the project. 00:16:30
Area tax revenue and the rest of Vineyard. 00:16:38
But then if you look to the very last line, the blue line at the very end in 2024, so these are RDA properties, you can see that 00:16:42
Alpine School District today is receiving more revenue from just the RDA properties where they're only receiving 25% of the 00:16:50
revenue there was. So they're 25%. 00:16:57
Is more than they were receiving from both all of Vineyard and the project area combined in 2009. 00:17:05
And so and so that, so if you follow the blue line, you notice that it goes up because that's appreciation and property values 00:17:14
that's happening plus some development because there were neighborhoods being built in Vineyard that were built within the project 00:17:20
area. And so that's contributing to the increase in the blue line until you hit 2016. And then what happens is after 2016 when you 00:17:27
get to year 2017. 00:17:34
Some of the first phases, the 1st 3 phases of the RDA were triggered. 00:17:41
Meaning that 75% of the property tax revenue that would have gone to the school district now goes to the RDA instead. So you see a 00:17:46
drop in the revenue that's expected, but then what happens is the school district is now only receiving 25% of the revenue they 00:17:56
would have received previously. And that 25% share increases over time as the whole project area is being developed and so. 00:18:05
This this is exactly why. 00:18:15
School districts will participate is they know that while they'll take a haircut in the short term, they'll be back to where they 00:18:18
were before and far beyond that. 00:18:22
And so that's kind of what this what this chart shows. And in in both cases, you can see the blue line is pretty steep in the 00:18:27
beginning, which shows the value of just building neighborhoods. But you also another reason those lines are steep is you're 00:18:34
coming out of a recession at that time as well. And so property values were going up. 00:18:41
More than they might otherwise go up just naturally. 00:18:48
I know it's kind of complicated. There's a lot of moving parts on this chart that's it represents a whole lot of data. 00:18:52
But I tried to simplify it so that you can kind of see some comparisons. So any any questions about that? 00:18:58
It's OK, you can kind of Stew on it if you want, but. 00:19:14
I don't think we have questions. It's good, OK. 00:19:17
OK, let me think here. I think there was one other. 00:19:23
One other thing, Oh no, I was going to maybe revisit the taxing entity question that we had discussed in a previous meeting, but 00:19:28
we really did I think hammer that issue pretty well, which is that the taxing entity committee exists kind of as needed one off. 00:19:35
It's not a continuing entity. It exists for the purpose of bringing together these participating taxing entities like the school 00:19:42
districts to approve their participation initially in opting into the the tax. 00:19:50
OK. Thank you all. 00:20:01
Thank you, I honestly really appreciate it. 00:20:05
I would just say that I mean, in the most not kindest terms, I think this is a manipulation of data and I don't think it 00:20:12
represents. I mean, obviously if I were to. 00:20:18
We need to be very clear with our words that. 00:20:24
When we say that they pay taxes, they pay taxes. 00:20:27
But then it's remitted back to them in January, right? 00:20:31
So it's a kind of a play on words. 00:20:36
No, so they pay taxes so like, like using the example of a developer, right, right. So if you have a developer in the project area 00:20:38
that owns property, they're paying all the property taxes that they would that any property owner would normally pay based on the 00:20:45
value of the land which the value of a lot of the land that is still undergoing environmental remediation is quite low. It and it 00:20:53
and I believe it actually qualifies essentially for the same type of treatment as a as a Greenbelt, but. 00:21:00
Nonetheless, they pay those taxes. 00:21:08
Then what happens is not in January, but at the at whatever time is appropriate based on invoicing and based on contract, you 00:21:10
know, contractual agreements, the RDA pays them per a separate contract. That has nothing to do with how you know what they paid 00:21:17
in taxes. It's like they have a specific contract. If they do this project or that project that they're working on this or that, 00:21:23
then they're reimbursed. 00:21:30
A certain amount of money per the contract. 00:21:37
What I'm saying though, is how amazing it would be if, let's say, my landscaping wasn't done because it's done now. 00:21:40
And I paid taxes like a normal person and then I had a blighted area and it's like I got that back because then therefore it would 00:21:47
improve the value of my property. That's what we're doing right, is it's a special area where only 50% of the properties are 00:21:54
getting that and we're hoping that it will increase in value. 00:22:00
And I get it, we're not going to convince each other tonight on where we stand, but I just think it's incredible to look at how 00:22:09
data can be used to show one thing and the exact same data can show the other. 00:22:15
And so I don't want to belabor the point tonight, but I do think that if we're giving one side of the argument a voice to do it, I 00:22:22
think that those specialists that are of the other voice should be, have the ability to come on the agenda and teach the other 00:22:28
side of things. Josh, do you see another side of things that you would feel comfortable? I, I guess I'm not understanding 00:22:35
completely. 00:22:42
What what your goals are with the well, I mean, we're coming to do the same exact presentation to kind of belabor the point. And 00:22:49
it's like I think if we're trying to sell us on. 00:22:55
Locking everybody into the what, 2011 tax rate and allowing them to do that and then saying, oh, but they're really not getting it 00:23:03
back. But they're getting it back in a different way. I mean, they are. It's just kind of a, a play on words. And I, I mean that 00:23:08
in the nicest way, but it's just. 00:23:13
Everyone went through the tax comparison to see that it's not functioning like we're not getting. 00:23:19
You know what, the 70 million that we've pushed back, I don't think we've gotten the 70 million back. 00:23:25
Who are hoping in the future it would be but it hasn't come to fruition yet right but you didn't in total revenue but what's your 00:23:32
I guess so you're saying that you're worried that this is like a sales pitch right and so. 00:23:38
Which is great. I mean, we all want the RDA to be successful, right? Well, for me, I'm looking at numbers. 00:23:45
And so I don't, I don't necessarily feel it's a sales pitch as much as trying to understand how the RDA works. And so I guess. 00:23:51
I think more importantly, it would be good at some point I would really like to understand your concerns and what your goals are 00:23:59
with your concerns. There are there are professional sort of sat down with us. Well, I mean, I have a lot of faith in our RDA 00:24:06
director. I mean, he has a really impressive resume. Yeah. May I just interrupt and say I can't speak for the rest of the council, 00:24:12
but I don't believe been you've been manipulative. I appreciate you bringing the data. No, I'm not done. 00:24:19
And correct me if I'm wrong is that. 00:24:56
We are just providing the algorithm or the calculation by how? 00:24:59
We provide taxation with the RDA. It's not a opinion, it is just a calculation and it's done according to the RDA flaws that are 00:25:05
in place. And that's what we are discussing. And so I think we can find clarity in it. We can post it, we can send you guys all of 00:25:14
that information. But let's go ahead and move on to the next point. I would just marry the two comments, right, So you have. 00:25:23
39 million. 00:25:33
That didn't go to schools. And then you have the 20 million that that came in, right? So you have a total of 60 million. In your 00:25:35
last meeting, Josh, you showed that, hey, the property of X Mission went from what was it 8 to 6000 to 46,000 or something like 00:25:42
that. I mean, so it's like, hey, we saw 30,000% increase in property value. And it's like, right, That 36,000 is much smaller than 00:25:49
the 40 million right now. That's only one year. 00:25:55
But still, that's a small increment for. 00:26:03
Will it actually pay back? And so I just think modeling, and I'm not saying Josh is manipulating the numbers and you can 00:26:06
manipulate data to look at different things to to show out different things. I think everyone knows that. And I just wanted to 00:26:11
point that out that I think it's important that the RDA. 00:26:17
Get second and third opinions. And we do, we actually work with financial advisors that look at all of these numbers and they're 00:26:23
very well known in the state. And I think we've presented data that is very clear tonight. So Josh, if you don't have anything 00:26:30
else, is that the end of your update? OK, I'm adjourning this meeting and we'll move on to our next meeting in about 10 minutes. 00:26:37
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