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Chair Fullmer opened the meeting at00 PM. Boardmember Cameron gave the invocation and led the Pledge of Allegiance.            CONSENT ITEMS1.    Approvalof June,2024, RDAMeeting Minutes   Chair Fullmer called for a motion.
Motion:BOARDMEMBER RASMUSSEN MOVED TO APPROVE THE CONSENT ITEM AS PRESENTED. BOARDMEMBER CAMERON SECONDED THE MOTION. CHAIR FULLMER, BOARDMEMBERS CAMERON, HOLDAWAY, RASMUSSEN, AND SIFUENTES VOTED YES. THE MOTION CARRIED UNANIMOUSLY.             PRESENTATIONS/RECOGNITIONS/AWARDS/PROCLAMATIONS1.    RDA Update RDADirectorJoshDanielswillgiveanupdateontheRDA. Chair Fullmer turned the time over to RDADirectorJoshDaniels.
Mr. Daniels reviewed the fiscal impact the RDA had on the Alpine School District. He noted that all properties in Vineyard were being assessed at the current tax rate, with a few exceptions.
Mr. Daniels explained that the current RDA reimbursement agreements were reimbursed post-performance and that developers were taking the risk in building infrastructure.
Boardmember Cameron asked about the infrastructure that was built in the Forge Development area. Chair Fullmer explained that the infrastructure was built to service two development sites, The Forge and The Yard.
Mr. Daniels continued his update. He compared the value of property in the RDA and the rest of the city. He reviewed tax revenues and the amount going to the school district.
Mr. Daniels gave a brief overview of the Taxing Entity Committee.
Boardmember Sifuentes thanked Mr. Daniels for his presentation.
Boardmember Holdaway felt that this was a manipulation of data. Mr. Daniels explained how tax revenue worked. A discussion ensued.            BUSINESSITEMS There were no business items.              ADJOURNMENT
Chair Fullmer adjourned the meeting at26 PM.     MINUTES APPROVED ON:  December,24 CERTIFIED CORRECT BY:   Pamela Spencer, CIty recorder
All right, today is August 28th, 2024. The time is 6:00 PM. 00:00:01
It's OK. 00:00:12
All right. 00:00:21
Is that working? 00:00:23
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. 00:00:26
We're going to start out with an invocation and the Pledge of Allegiance by Council Member Cameron. 00:00:33
Our dear Father in heaven, they come before that this evening to ask what I spirit to be with us as we hold this meeting and pray 00:00:46
that they'll help us to be mindful of. 00:00:51
The needs of the citizens and that will be considerate of each other and that will work together. 00:00:58
For the best of this community, we love thee and are grateful for all the blessings and abundance that surround us. And we say 00:01:04
these things in the sacred name of Jesus Christ, Amen. Amen. 00:01:09
I pledge allegiance to the flag of the United States of America and to the Republic for which it stands, one nation under God, 00:01:19
indivisible, with liberty and justice for all. 00:01:26
All right, we'll move on to our consent agenda. I need a motion. 00:01:35
I move to approve consent items as presented. OK, we have a first by Amber. Can I get a second? 00:01:42
Second Second by Sarah. Any discussion? 00:01:48
All in favor, aye? 00:01:52
All right, that brings us to 3.1, our RDA update and our RDA Director, Josh Daniels will give us an update on the RDA. Good 00:01:55
evening, council members. Well, board members, we have the. 00:02:03
Yeah, thanks. 00:02:15
So I just have been doing some financial research that I think will help to answer some questions that have been raised over the 00:02:20
course of several weeks. And then also if there are additional questions we could maybe start a few minutes. I could you know 00:02:27
spend a few minutes responding to them. Let me pull up that our presentation here. 00:02:34
It's just taking a little bit of time. 00:02:56
There we go. 00:03:12
OK. So a couple of points. First of all, since the beginning of the use of increment within the project area of the RDA, which 00:03:19
phases were first triggered in 2017, the cumulative total increment revenue that's been collected? 00:03:30
And paid to the RDA. 00:03:42
Is just over. It's, you know, 76 and a half million. 00:03:45
The bulk of that is spent on a reimbursement basis. 00:03:50
To those contractors and developers that are doing work in the project area on environmental remediation as well as. 00:03:55
City infrastructure, roads and, and get curb and gutter and sewer and some of those sorts of things. That's that's really where 00:04:05
the bulk of those dollars are spent and it's really where the bulk of the dollars will be spent over the lifetime. 00:04:11
Of of the existence of the project area for the RDA. 00:04:18
Now a question has kind of come up about the fiscal impact on the Alpine School District. So I just wanted to review the theory of 00:04:24
why the school districts around the state will agree to participate in increment, which is to essentially give up revenue for a 00:04:32
period of time. And it's because you're talking about land that is not valuable. 00:04:40
But that if this investment is made, then the land will become more valuable and then in the long run, the school district will 00:04:49
actually receive more total tax revenue over time. 00:04:54
And so I've got some data I want to share with you that'll kind of show that. But just as a summation point, to date, the Alpine 00:04:59
School District's share of that 76,000,000 is 39, just under 40 million. So it's about 52% of the revenue. 00:05:07
Comes from the Alpine School District's share, which makes sense. Alpine School District makes up, you know, 50%, actually a 00:05:17
little more of all tax revenues collected. You know, when people pay property tax. 00:05:23
Over 50% is going to the school district. That's the largest user of property tax revenues. The city's share is 2020 million. 00:05:30
And again, that's over the course of time since 2017, cumulative. 00:05:39
I think there's been some misunderstanding about the payment of property taxes. All properties in the city, in the RDA, in the 00:05:45
project area, all properties are being assessed property taxes at the current property tax rates that everybody has to pay. So no 00:05:53
land owner is given any kind of special treatment. 00:06:02
You know, unless they have, you know, some sort of an exemption, which there are certain things, certain property owners might 00:06:12
have certain exemptions, of course there's like Greenbelt and and those kinds of things, but outside of those normal. 00:06:18
Programs all land owners, including the developers that own. 00:06:25
You know, a good chunk of the project area they are paying property taxes on all those properties that they own and at those 00:06:30
current rates. And so the property tax revenue that is then collected a share of that property tax is then potentially rebated 00:06:38
back in the case of let's say a developer doing work on a reimbursement basis as they are spending money to build infrastructure. 00:06:46
But then you know those that 75% share, that's the increment. 00:06:55
That goes to the RDA and the RDA then pays that out on a reimbursement basis. Another important principle that I think sometimes 00:07:00
isn't well understood is that in Utah generally and specifically in the case of the Geneva project area and and this RDA, all of 00:07:08
the agreements to to spend tax increment financing funds are post performance. There are other states where economic development 00:07:15
and tax increment financing might be. 00:07:23
Used in some sort of a subsidization basis to incentivize things. That's not really the approach that we've taken. The approach 00:07:30
that we take is post performance. So it's not really an incentive. I mean, it does incent people to do things, but people are only 00:07:38
paid once they've actually created something and done their end of the bargain in this case, you know, perform certain 00:07:45
environmental cleanup projects that they've expended funds to do. 00:07:52
Or actually built certain infrastructure projects that they then get reimbursed for after the fact. So why that's important is the 00:08:00
city wins because the city gets the infrastructure 1st and the developer in a sense is acting like a like an investor or a 00:08:08
bondholder or, but but they're taking the risk. 00:08:17
And so they're fronting the city. A street. 00:08:27
In the hopes that the city will then collect sales tax or property tax revenue through the increment that's sufficient to pay them 00:08:31
back. And so they're taking risk with their dollars today to build infrastructure and they're on the hook essentially to finance 00:08:37
it. And then they get reimbursed once they've once they've done the performance. Now that's a really great model because the city 00:08:43
doesn't have a whole lot of risk in that environment. And you get streets and other kinds of infrastructure and the environmental 00:08:49
cleanup up front. 00:08:55
Rather than maybe a traditional model where you have to bond for something, get the money, then go out and build the road. And 00:09:02
you're not going to be able to bond if you're not able to demonstrate certain revenues in that moment as you're trying to qualify 00:09:09
or, or yeah, basically qualify for that bond and, and so this particular. 00:09:17
Feature that we're as a city able to utilize is a is a great advantage because. 00:09:26
You're able to build a lot of infrastructure quickly and therefore able to build out the city fairly quickly with, you know, 00:09:32
housing and and other kinds of projects. So any questions before I jump into the next charter graph about any of those points? 00:09:39
Yeah, I have a question. So we met with Jason Kirk, was he there? And he mentioned that the Forge, we did a lot of the 00:09:45
infrastructure first. 00:09:52
Thinking that they were going to go ahead. And so is that different than a TIF fund? Like why did we do that? 00:09:59
And they haven't done anything with the land yet. 00:10:05
So you're saying this the city spent money to build the infrastructure? Yeah. I mean, that's in that scenario. I wasn't around at 00:10:08
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 00:10:15
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 00:10:23
served both sites. So it was infrastructure to service the whole area. 00:10:30
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 00:10:38
station, mill roads and things like that. That equals about $4 million in total. I think there was about 600,000 specific to that 00:10:44
site, but it was to service the whole area. And so we've seen growth on one side and then on the other side is not yet performed, 00:10:51
but that's why it is. It's a similar thing that happened in the yard where we put in the cleanup or the. 00:10:58
Water infrastructure so that they could build on the site. 00:11:06
And rarely do we do upfront funding, it's usually a very small amount, but this one in particular was to service the entire area. 00:11:09
So. 00:11:14
OK, any other snow? 00:11:23
All right here. 00:11:26
OK, so. 00:11:29
Here's a chart that will show why. 00:11:31
The investment in the utilization of increment financing to help development, why that might make sense and what probably what the 00:11:36
school district was thinking when they chose to participate, you know, voting to participate 15 years ago. So here you have two 00:11:45
lines going all the way back to when the project area, just slightly before the project area was first designated. 00:11:54
And the the RDA was created and the increment financing was approved, which are activities that took place between 2009 and 2014. 00:12:04
And so the real work of actually doing the environmental remediation and working on development and the creation of infrastructure 00:12:14
began in earnest after 2014. And So what this chart shows is it shows the value of all property within. 00:12:24
The project area of the RDA in blue. 00:12:34
And it shows the value of all other property in the city of Vineyard that is not within the project area. And the thing that's 00:12:37
interesting to look at in the chart is the differences in the slope of the line, which is the rate of increase of the value of the 00:12:44
land. 00:12:52
And So what you see is that once the investment in the development, environmental cleanup and infrastructure of the area. 00:13:00
The project area begins, you see a real significant increase in the value of that land. 00:13:09
Versus the value of the other land that's not in the project area and so. 00:13:19
What that's showing you is that the the net effect of the upfront and well, not up front, but well, it's upfront investment on the 00:13:25
part of developers. But the net effect of that upfront development for them, which they're incentivized to do because there's a 00:13:33
reimbursement agreement that they have increases the value of the land faster than land that is not, that is not undergoing that 00:13:40
same type of investment. Now granted some of the areas in the red are sort of already built out. 00:13:48
So you're just looking at maybe appreciation versus land that's fallow that's being built on, right. So that also makes sense as 00:13:55
to why there would be a steeper line in the faster growth. But because of that, so the question is how fast can we make land that 00:14:04
is blighted and like the former Geneva site, how fast can we make that land more valuable for the purpose of tax revenue? 00:14:13
That's what the school district is wondering. 00:14:23
Because and that's what every tax entity is wondering is they're saying, well, if nothing happens on this property, it will remain 00:14:25
not so valuable and we will not receive very much tax revenue. But if we can invest in making, you know, developing this land, 00:14:33
increasing its taxable value quickly, we will get more property tax revenue both in the near term and over the long term. And that 00:14:40
is the reason that taxing entities choose to participate in giving up some of their property tax revenues. 00:14:48
For a period of time so that it can accelerate the development of that land, that blighted land, and, and then they can have that 00:14:55
that pay off, which is that they'll receive tax revenues quickly that they wouldn't have otherwise received. And over the long 00:15:03
term, they'll also receive more revenue and, and on a faster timeline. So now to actually look at that, I've got this other chart 00:15:10
and these are the two main charts I wanted to show before. 00:15:18
Any questions about this? 00:15:26
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 00:15:30
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, 00:15:36
the tax revenue to Alpine School District that is collected from within the project area. So those are those are properties that 00:15:42
might be subject to the tax increment financing, which means a portion of those revenues are going to the RDA and not to the 00:15:47
school district. 00:15:53
And that's versus those non RDA properties in Vineyard. So here's an important thing to think about. If we go back to 2009, we see 00:16:00
that the total amount of annual property tax revenue that's collected, that's what this is. This is annual property tax revenue. 00:16:09
This is the actual revenue that Alpine School District actually receives. 00:16:18
Including the haircut that happens when. 00:16:27
When 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 00:16:30
can see there's it's pretty close between the project area tax revenue and the rest of Vineyard. 00:16:37
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 00:16:46
Alpine School District today is receiving more revenue from just the RDA properties where they're only receiving 25% of the 00:16:56
revenue they're so they're 25% is more than they were receiving from both all of Vineyard and. 00:17:05
Project area combined in 2009. 00:17:15
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 00:17:18
that's happening plus some development because there were neighborhoods being built in Vineyard that were built within the project 00:17:24
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 00:17:31
get to year 2017. 00:17:38
Some of the first phases. The first 3 phases of the. 00:17:45
Were triggered meaning that 75% of the property tax revenue that would have gone to the school district now goes to the RDA 00:17:49
instead So you see a drop in the revenue that's expected but then what happens is the school district is now only receiving 25% of 00:17:56
the revenue they would have received previously and that 25% share increases over time as the whole project area is being 00:18:04
developed and so. 00:18:11
This, this is exactly why school districts will participate is they know that while they'll take a haircut in the short term, 00:18:19
they'll be back to where they were before and far beyond that. And so that's kind of what this, what this chart shows. And in, in 00:18:27
both cases, you can see the blue line is pretty steep in in the beginning, which shows the value of just building neighborhoods. 00:18:34
But you also another reason those lines are steep is you're coming out of a recession. 00:18:41
At that time as well, so property values were going up more than they might otherwise go up just naturally. So I know it's kind of 00:18:49
complicated. There's a lot of moving parts on this chart. It represents a whole lot of data, but I tried to simplify it so that 00:18:56
you can kind of see some comparisons. So any, any questions about that? 00:19:03
It's OK, you can kind of Stew on it if you want, but. 00:19:18
I don't think we have questions. It's good, OK. 00:19:21
OK, let me think here. I think there was one other. 00:19:27
One other thing, no, I was going to maybe revisit the taxing entity question that we discussed in a previous meeting, but we 00:19:32
really did I think hammer that issue pretty well, which is that the taxing entity committee exists kind of as needed one off. It's 00:19:39
not a continuing entity. It exists for the purpose of bringing together these participating taxing entities like the school 00:19:46
districts to approve their participation initially in opting into the the tax. 00:19:54
Increment so. 00:20:01
OK. Thank you all. 00:20:05
And thank you, all right, Honestly really appreciate it. 00:20:08
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 00:20:16
represents. I mean, obviously if I were to, we need to be very clear with our words that. 00:20:23
When we say that they pay taxes, they pay taxes, but then it's remitted back to them in January, right? 00:20:31
So it's a kind of a play on words, no? So they pay taxes. So like like using the example of a developer, right, Right. So if you 00:20:40
have a developer in the project area that owns property, they're paying all the property taxes that they would, that any property 00:20:47
owner would normally pay based on the value of the land, which the value of a lot of the land that is still undergoing 00:20:54
environmental remediation is quite low. And I believe it actually qualifies essentially for the. 00:21:02
Type of treatment as a Greenbelt, but. 00:21:09
Nonetheless, they pay those taxes. 00:21:12
Then what happens is not in January, but at the at whatever time is appropriate based on invoicing and based on contract, you 00:21:15
know, contractual agreements, the RDA pays them per a separate contract that has nothing to do with, you know, what they paid in 00:21:21
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, 00:21:27
then they're reimbursed. 00:21:34
A certain amount of money per the contract. 00:21:41
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. 00:21:44
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 00:21:52
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 00:21:58
getting that and we're hoping that it will increase in value. 00:22:04
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 00:22:13
data can be used to show one thing and the exact same data can show the other. And so I don't want to belabor the point tonight, 00:22:20
but I do think that if we're giving one side of the argument a voice to do it, I think that those specialists that are of the 00:22:27
other voice should be have the ability to come on the agenda and. 00:22:35
Teach the other side of things and Josh, do you see another side of things that you would feel comfortable? I guess I'm not 00:22:42
understanding completely what what your goals are with me. Well, I mean, we're coming to do the same exact presentation to kind of 00:22:50
belabor the point and it's like I think if we're trying to sell us on. 00:22:57
Locking everybody into the what, 2011 tax rate and allowing them to do that and then saying, but they're really not getting it 00:23:07
back, but they're getting it back in a different way. I mean, they are, it's just kind of a play on words. And I mean that in the 00:23:14
nicest way, but it's just everyone went through the tax comparison to see that it it's not functioning like we're not getting. 00:23:21
You know what, the 70 million that we've pushed back, I don't think we've gotten the 70 million back. 00:23:29
And we're hoping in the future it would be that it hasn't come to fruition yet, right? But you didn't in total revenue. But what's 00:23:36
your, I guess, so you're saying that you're worried that this is like a small pitch, right? And so which is great. I mean, we all 00:23:43
want the RDA to be successful, right? Well, for me, I'm looking at numbers. And so I don't, I don't necessarily feel it's a sales 00:23:49
pitch as much as trying to understand how the RDA works. And so I guess. 00:23:56
I think more importantly, it would be good at some point. 00:24:03
To I would really like to understand your concerns and what your goals are with your concerns. There are there are professionals 00:24:07
that have sat down with us. Well, I mean, I have a lot of faith in our RDA director. I mean, he has a really impressive resume. 00:24:13
Yeah. May I just interrupt and say I can't speak through this at the council, but I don't believe you've been manipulative. I 00:24:18
appreciate you bringing the data. No, I'm not done. 00:24:24
And correct me if I'm wrong is that. 00:25:00
We are just providing the algorithm or the calculation by how? 00:25:03
We provide taxation with the RDA. It's not a opinion. It is just a calculation and it's done according to the RDA laws that are in 00:25:09
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 00:25:18
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. 00:25:27
39 million. 00:25:37
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 00:25:39
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 00:25:46
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 00:25:53
the 40 million right now. That's only one year. 00:26:00
But still, that's a small increment for. 00:26:07
Will it actually pay back? And so I just think modeling, and I'm not saying Josh is manipulating the numbers in a, you can 00:26:10
manipulate data to look at different things to, to show out different things. I think everyone knows that. And I just wanted to 00:26:16
point that out that I think it's important that the RDA get second and third opinions and we do, we actually work with financial 00:26:22
advisors that look at all of these numbers and. 00:26:28
They're very well known in the state and I think we've presented data that is very clear tonight, so. 00:26:35
Jess, if you don't have anything else, is that the end of your update? Yeah, OK. I'm adjourning this meeting and we'll move on to 00:26:42
our next meeting in about 10 minutes. 00:26:45
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All right, today is August 28th, 2024. The time is 6:00 PM. 00:00:01
It's OK. 00:00:12
All right. 00:00:21
Is that working? 00:00:23
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. 00:00:26
We're going to start out with an invocation and the Pledge of Allegiance by Council Member Cameron. 00:00:33
Our dear Father in heaven, they come before that this evening to ask what I spirit to be with us as we hold this meeting and pray 00:00:46
that they'll help us to be mindful of. 00:00:51
The needs of the citizens and that will be considerate of each other and that will work together. 00:00:58
For the best of this community, we love thee and are grateful for all the blessings and abundance that surround us. And we say 00:01:04
these things in the sacred name of Jesus Christ, Amen. Amen. 00:01:09
I pledge allegiance to the flag of the United States of America and to the Republic for which it stands, one nation under God, 00:01:19
indivisible, with liberty and justice for all. 00:01:26
All right, we'll move on to our consent agenda. I need a motion. 00:01:35
I move to approve consent items as presented. OK, we have a first by Amber. Can I get a second? 00:01:42
Second Second by Sarah. Any discussion? 00:01:48
All in favor, aye? 00:01:52
All right, that brings us to 3.1, our RDA update and our RDA Director, Josh Daniels will give us an update on the RDA. Good 00:01:55
evening, council members. Well, board members, we have the. 00:02:03
Yeah, thanks. 00:02:15
So I just have been doing some financial research that I think will help to answer some questions that have been raised over the 00:02:20
course of several weeks. And then also if there are additional questions we could maybe start a few minutes. I could you know 00:02:27
spend a few minutes responding to them. Let me pull up that our presentation here. 00:02:34
It's just taking a little bit of time. 00:02:56
There we go. 00:03:12
OK. So a couple of points. First of all, since the beginning of the use of increment within the project area of the RDA, which 00:03:19
phases were first triggered in 2017, the cumulative total increment revenue that's been collected? 00:03:30
And paid to the RDA. 00:03:42
Is just over. It's, you know, 76 and a half million. 00:03:45
The bulk of that is spent on a reimbursement basis. 00:03:50
To those contractors and developers that are doing work in the project area on environmental remediation as well as. 00:03:55
City infrastructure, roads and, and get curb and gutter and sewer and some of those sorts of things. That's that's really where 00:04:05
the bulk of those dollars are spent and it's really where the bulk of the dollars will be spent over the lifetime. 00:04:11
Of of the existence of the project area for the RDA. 00:04:18
Now a question has kind of come up about the fiscal impact on the Alpine School District. So I just wanted to review the theory of 00:04:24
why the school districts around the state will agree to participate in increment, which is to essentially give up revenue for a 00:04:32
period of time. And it's because you're talking about land that is not valuable. 00:04:40
But that if this investment is made, then the land will become more valuable and then in the long run, the school district will 00:04:49
actually receive more total tax revenue over time. 00:04:54
And so I've got some data I want to share with you that'll kind of show that. But just as a summation point, to date, the Alpine 00:04:59
School District's share of that 76,000,000 is 39, just under 40 million. So it's about 52% of the revenue. 00:05:07
Comes from the Alpine School District's share, which makes sense. Alpine School District makes up, you know, 50%, actually a 00:05:17
little more of all tax revenues collected. You know, when people pay property tax. 00:05:23
Over 50% is going to the school district. That's the largest user of property tax revenues. The city's share is 2020 million. 00:05:30
And again, that's over the course of time since 2017, cumulative. 00:05:39
I think there's been some misunderstanding about the payment of property taxes. All properties in the city, in the RDA, in the 00:05:45
project area, all properties are being assessed property taxes at the current property tax rates that everybody has to pay. So no 00:05:53
land owner is given any kind of special treatment. 00:06:02
You know, unless they have, you know, some sort of an exemption, which there are certain things, certain property owners might 00:06:12
have certain exemptions, of course there's like Greenbelt and and those kinds of things, but outside of those normal. 00:06:18
Programs all land owners, including the developers that own. 00:06:25
You know, a good chunk of the project area they are paying property taxes on all those properties that they own and at those 00:06:30
current rates. And so the property tax revenue that is then collected a share of that property tax is then potentially rebated 00:06:38
back in the case of let's say a developer doing work on a reimbursement basis as they are spending money to build infrastructure. 00:06:46
But then you know those that 75% share, that's the increment. 00:06:55
That goes to the RDA and the RDA then pays that out on a reimbursement basis. Another important principle that I think sometimes 00:07:00
isn't well understood is that in Utah generally and specifically in the case of the Geneva project area and and this RDA, all of 00:07:08
the agreements to to spend tax increment financing funds are post performance. There are other states where economic development 00:07:15
and tax increment financing might be. 00:07:23
Used in some sort of a subsidization basis to incentivize things. That's not really the approach that we've taken. The approach 00:07:30
that we take is post performance. So it's not really an incentive. I mean, it does incent people to do things, but people are only 00:07:38
paid once they've actually created something and done their end of the bargain in this case, you know, perform certain 00:07:45
environmental cleanup projects that they've expended funds to do. 00:07:52
Or actually built certain infrastructure projects that they then get reimbursed for after the fact. So why that's important is the 00:08:00
city wins because the city gets the infrastructure 1st and the developer in a sense is acting like a like an investor or a 00:08:08
bondholder or, but but they're taking the risk. 00:08:17
And so they're fronting the city. A street. 00:08:27
In the hopes that the city will then collect sales tax or property tax revenue through the increment that's sufficient to pay them 00:08:31
back. And so they're taking risk with their dollars today to build infrastructure and they're on the hook essentially to finance 00:08:37
it. And then they get reimbursed once they've once they've done the performance. Now that's a really great model because the city 00:08:43
doesn't have a whole lot of risk in that environment. And you get streets and other kinds of infrastructure and the environmental 00:08:49
cleanup up front. 00:08:55
Rather than maybe a traditional model where you have to bond for something, get the money, then go out and build the road. And 00:09:02
you're not going to be able to bond if you're not able to demonstrate certain revenues in that moment as you're trying to qualify 00:09:09
or, or yeah, basically qualify for that bond and, and so this particular. 00:09:17
Feature that we're as a city able to utilize is a is a great advantage because. 00:09:26
You're able to build a lot of infrastructure quickly and therefore able to build out the city fairly quickly with, you know, 00:09:32
housing and and other kinds of projects. So any questions before I jump into the next charter graph about any of those points? 00:09:39
Yeah, I have a question. So we met with Jason Kirk, was he there? And he mentioned that the Forge, we did a lot of the 00:09:45
infrastructure first. 00:09:52
Thinking that they were going to go ahead. And so is that different than a TIF fund? Like why did we do that? 00:09:59
And they haven't done anything with the land yet. 00:10:05
So you're saying this the city spent money to build the infrastructure? Yeah. I mean, that's in that scenario. I wasn't around at 00:10:08
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 00:10:15
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 00:10:23
served both sites. So it was infrastructure to service the whole area. 00:10:30
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 00:10:38
station, mill roads and things like that. That equals about $4 million in total. I think there was about 600,000 specific to that 00:10:44
site, but it was to service the whole area. And so we've seen growth on one side and then on the other side is not yet performed, 00:10:51
but that's why it is. It's a similar thing that happened in the yard where we put in the cleanup or the. 00:10:58
Water infrastructure so that they could build on the site. 00:11:06
And rarely do we do upfront funding, it's usually a very small amount, but this one in particular was to service the entire area. 00:11:09
So. 00:11:14
OK, any other snow? 00:11:23
All right here. 00:11:26
OK, so. 00:11:29
Here's a chart that will show why. 00:11:31
The investment in the utilization of increment financing to help development, why that might make sense and what probably what the 00:11:36
school district was thinking when they chose to participate, you know, voting to participate 15 years ago. So here you have two 00:11:45
lines going all the way back to when the project area, just slightly before the project area was first designated. 00:11:54
And the the RDA was created and the increment financing was approved, which are activities that took place between 2009 and 2014. 00:12:04
And so the real work of actually doing the environmental remediation and working on development and the creation of infrastructure 00:12:14
began in earnest after 2014. And So what this chart shows is it shows the value of all property within. 00:12:24
The project area of the RDA in blue. 00:12:34
And it shows the value of all other property in the city of Vineyard that is not within the project area. And the thing that's 00:12:37
interesting to look at in the chart is the differences in the slope of the line, which is the rate of increase of the value of the 00:12:44
land. 00:12:52
And So what you see is that once the investment in the development, environmental cleanup and infrastructure of the area. 00:13:00
The project area begins, you see a real significant increase in the value of that land. 00:13:09
Versus the value of the other land that's not in the project area and so. 00:13:19
What that's showing you is that the the net effect of the upfront and well, not up front, but well, it's upfront investment on the 00:13:25
part of developers. But the net effect of that upfront development for them, which they're incentivized to do because there's a 00:13:33
reimbursement agreement that they have increases the value of the land faster than land that is not, that is not undergoing that 00:13:40
same type of investment. Now granted some of the areas in the red are sort of already built out. 00:13:48
So you're just looking at maybe appreciation versus land that's fallow that's being built on, right. So that also makes sense as 00:13:55
to why there would be a steeper line in the faster growth. But because of that, so the question is how fast can we make land that 00:14:04
is blighted and like the former Geneva site, how fast can we make that land more valuable for the purpose of tax revenue? 00:14:13
That's what the school district is wondering. 00:14:23
Because and that's what every tax entity is wondering is they're saying, well, if nothing happens on this property, it will remain 00:14:25
not so valuable and we will not receive very much tax revenue. But if we can invest in making, you know, developing this land, 00:14:33
increasing its taxable value quickly, we will get more property tax revenue both in the near term and over the long term. And that 00:14:40
is the reason that taxing entities choose to participate in giving up some of their property tax revenues. 00:14:48
For a period of time so that it can accelerate the development of that land, that blighted land, and, and then they can have that 00:14:55
that pay off, which is that they'll receive tax revenues quickly that they wouldn't have otherwise received. And over the long 00:15:03
term, they'll also receive more revenue and, and on a faster timeline. So now to actually look at that, I've got this other chart 00:15:10
and these are the two main charts I wanted to show before. 00:15:18
Any questions about this? 00:15:26
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 00:15:30
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, 00:15:36
the tax revenue to Alpine School District that is collected from within the project area. So those are those are properties that 00:15:42
might be subject to the tax increment financing, which means a portion of those revenues are going to the RDA and not to the 00:15:47
school district. 00:15:53
And that's versus those non RDA properties in Vineyard. So here's an important thing to think about. If we go back to 2009, we see 00:16:00
that the total amount of annual property tax revenue that's collected, that's what this is. This is annual property tax revenue. 00:16:09
This is the actual revenue that Alpine School District actually receives. 00:16:18
Including the haircut that happens when. 00:16:27
When 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 00:16:30
can see there's it's pretty close between the project area tax revenue and the rest of Vineyard. 00:16:37
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 00:16:46
Alpine School District today is receiving more revenue from just the RDA properties where they're only receiving 25% of the 00:16:56
revenue they're so they're 25% is more than they were receiving from both all of Vineyard and. 00:17:05
Project area combined in 2009. 00:17:15
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 00:17:18
that's happening plus some development because there were neighborhoods being built in Vineyard that were built within the project 00:17:24
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 00:17:31
get to year 2017. 00:17:38
Some of the first phases. The first 3 phases of the. 00:17:45
Were triggered meaning that 75% of the property tax revenue that would have gone to the school district now goes to the RDA 00:17:49
instead So you see a drop in the revenue that's expected but then what happens is the school district is now only receiving 25% of 00:17:56
the revenue they would have received previously and that 25% share increases over time as the whole project area is being 00:18:04
developed and so. 00:18:11
This, this is exactly why school districts will participate is they know that while they'll take a haircut in the short term, 00:18:19
they'll be back to where they were before and far beyond that. And so that's kind of what this, what this chart shows. And in, in 00:18:27
both cases, you can see the blue line is pretty steep in in the beginning, which shows the value of just building neighborhoods. 00:18:34
But you also another reason those lines are steep is you're coming out of a recession. 00:18:41
At that time as well, so property values were going up more than they might otherwise go up just naturally. So I know it's kind of 00:18:49
complicated. There's a lot of moving parts on this chart. It represents a whole lot of data, but I tried to simplify it so that 00:18:56
you can kind of see some comparisons. So any, any questions about that? 00:19:03
It's OK, you can kind of Stew on it if you want, but. 00:19:18
I don't think we have questions. It's good, OK. 00:19:21
OK, let me think here. I think there was one other. 00:19:27
One other thing, no, I was going to maybe revisit the taxing entity question that we discussed in a previous meeting, but we 00:19:32
really did I think hammer that issue pretty well, which is that the taxing entity committee exists kind of as needed one off. It's 00:19:39
not a continuing entity. It exists for the purpose of bringing together these participating taxing entities like the school 00:19:46
districts to approve their participation initially in opting into the the tax. 00:19:54
Increment so. 00:20:01
OK. Thank you all. 00:20:05
And thank you, all right, Honestly really appreciate it. 00:20:08
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 00:20:16
represents. I mean, obviously if I were to, we need to be very clear with our words that. 00:20:23
When we say that they pay taxes, they pay taxes, but then it's remitted back to them in January, right? 00:20:31
So it's a kind of a play on words, no? So they pay taxes. So like like using the example of a developer, right, Right. So if you 00:20:40
have a developer in the project area that owns property, they're paying all the property taxes that they would, that any property 00:20:47
owner would normally pay based on the value of the land, which the value of a lot of the land that is still undergoing 00:20:54
environmental remediation is quite low. And I believe it actually qualifies essentially for the. 00:21:02
Type of treatment as a Greenbelt, but. 00:21:09
Nonetheless, they pay those taxes. 00:21:12
Then what happens is not in January, but at the at whatever time is appropriate based on invoicing and based on contract, you 00:21:15
know, contractual agreements, the RDA pays them per a separate contract that has nothing to do with, you know, what they paid in 00:21:21
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, 00:21:27
then they're reimbursed. 00:21:34
A certain amount of money per the contract. 00:21:41
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. 00:21:44
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 00:21:52
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 00:21:58
getting that and we're hoping that it will increase in value. 00:22:04
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 00:22:13
data can be used to show one thing and the exact same data can show the other. And so I don't want to belabor the point tonight, 00:22:20
but I do think that if we're giving one side of the argument a voice to do it, I think that those specialists that are of the 00:22:27
other voice should be have the ability to come on the agenda and. 00:22:35
Teach the other side of things and Josh, do you see another side of things that you would feel comfortable? I guess I'm not 00:22:42
understanding completely what what your goals are with me. Well, I mean, we're coming to do the same exact presentation to kind of 00:22:50
belabor the point and it's like I think if we're trying to sell us on. 00:22:57
Locking everybody into the what, 2011 tax rate and allowing them to do that and then saying, but they're really not getting it 00:23:07
back, but they're getting it back in a different way. I mean, they are, it's just kind of a play on words. And I mean that in the 00:23:14
nicest way, but it's just everyone went through the tax comparison to see that it it's not functioning like we're not getting. 00:23:21
You know what, the 70 million that we've pushed back, I don't think we've gotten the 70 million back. 00:23:29
And we're hoping in the future it would be that it hasn't come to fruition yet, right? But you didn't in total revenue. But what's 00:23:36
your, I guess, so you're saying that you're worried that this is like a small pitch, right? And so which is great. I mean, we all 00:23:43
want the RDA to be successful, right? Well, for me, I'm looking at numbers. And so I don't, I don't necessarily feel it's a sales 00:23:49
pitch as much as trying to understand how the RDA works. And so I guess. 00:23:56
I think more importantly, it would be good at some point. 00:24:03
To I would really like to understand your concerns and what your goals are with your concerns. There are there are professionals 00:24:07
that have sat down with us. Well, I mean, I have a lot of faith in our RDA director. I mean, he has a really impressive resume. 00:24:13
Yeah. May I just interrupt and say I can't speak through this at the council, but I don't believe you've been manipulative. I 00:24:18
appreciate you bringing the data. No, I'm not done. 00:24:24
And correct me if I'm wrong is that. 00:25:00
We are just providing the algorithm or the calculation by how? 00:25:03
We provide taxation with the RDA. It's not a opinion. It is just a calculation and it's done according to the RDA laws that are in 00:25:09
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 00:25:18
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. 00:25:27
39 million. 00:25:37
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 00:25:39
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 00:25:46
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 00:25:53
the 40 million right now. That's only one year. 00:26:00
But still, that's a small increment for. 00:26:07
Will it actually pay back? And so I just think modeling, and I'm not saying Josh is manipulating the numbers in a, you can 00:26:10
manipulate data to look at different things to, to show out different things. I think everyone knows that. And I just wanted to 00:26:16
point that out that I think it's important that the RDA get second and third opinions and we do, we actually work with financial 00:26:22
advisors that look at all of these numbers and. 00:26:28
They're very well known in the state and I think we've presented data that is very clear tonight, so. 00:26:35
Jess, if you don't have anything else, is that the end of your update? Yeah, OK. I'm adjourning this meeting and we'll move on to 00:26:42
our next meeting in about 10 minutes. 00:26:45
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