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Home My WebLink AboutWolf_Lakes_TIRZ_Board_Agenda_7_31_2020_3523Notice of Meeting for the Wolf L akes T I RZ B oard of the City of Georgetown July 31, 2020 at 2:15 P M at Virtual T he C ity of G eorgetown is committed to compliance with the Americans with Disabilities Act (ADA). If you require as s is tance in partic ipating at a public meeting due to a disability, as defined under the ADA, reas onable as s is tance, adaptations , or ac commodations will be provided upon request. P leas e c ontact the C ity S ec retary's O ffic e, at leas t three (3) days prior to the sc heduled meeting date, at (512) 930-3652 or C ity Hall at 808 Martin Luther King Jr. S treet, G eorgetown, T X 78626 for additional information; T T Y users route through R elay Texas at 711. L egislativ e Regular Agenda A C ons is tent with G overnor G reg Abbott’s sus pension of various provis ions of the O pen Meetings Ac t, effec tive August 1, 2020 and until further notic e, to reduc e the chanc e of C O VI D-19 transmission, all C ity of G eorgetown Advis ory Board meetings will be held virtually. P ublic c omment will be allowed via teleconferenc e; no one will be allowed to appear in pers on. To participate, pleas e c opy and pas te the following weblink into your brows er: Weblink: Join Microsoft Teams Meeting +1 512-672-8405 United S tates , Aus tin (Toll) C onferenc e I D: 540 912 481# C itizen c omments are acc epted in three different formats: 1 . S ubmit written c o mments to shirley.rinn@georgetown.org by no o n o n the d ate o f the meeting and the R ec ording S ecretary will read your c omments into the rec o rd ing during the item that is being disc ussed. 2. Log onto the meeting at the link above and “rais e your hand” during the item 3. Use your home/mobile phone to c all the toll-free number To join a Teams meeting, clic k on the link p ro vided and jo in as an attendee. You will be asked to enter your name and email ad d res s (this is s o we c an id entify you when you are c alled up o n). To speak on an item, c lic k on the “R aise your Hand ” option at the b o tto m of the Teams meeting webpage once that item has opened . W hen yo u are c alled up o n b y the R ec o rd ing S ec retary, your device will be remotely un- muted by the Ad ministrator and yo u may speak for three minutes. P leas e state yo ur name c learly, and when your time is over, your devic e will be muted again. Use of profanity, threatening language, sland ero us remarks o r threats of harm are not allo wed and will result in you being immediately removed from the meeting. B Disc ussion on how this virtual c onference will be c onducted, to inc lude options for public c omments and how the public may addres s the C ommis s ion – Mayor Dale R oss, C hair C Approval of the Dec ember 16, 2019 Wolf Lakes T I R Z Board Meeting minutes - Mayor Dale R oss, C hair D P resentation of the annual financial report for the Wolf Lakes Tax Inc rement R einvestment Zone – Laurie Brewer, Assistant C ity Manager Page 1 of 28 Adjournment Ce rtificate of Posting I, R obyn Densmore, C ity S ecretary for the C ity of G eorgetown, Texas, do hereby c ertify that this Notic e of Meeting was posted at C ity Hall, 808 Martin Luther King Jr. S treet, G eorgetown, T X 78626, a plac e readily acc es s ible to the general public as required by law, on the _____ day of _________________, 2020, at __________, and remained s o posted for at leas t 72 c ontinuous hours prec eding the s cheduled time of said meeting. __________________________________ R obyn Dens more, C ity S ec retary Page 2 of 28 City of Georgetown, Texas Downtown T I RZ Board July 31, 2020 S UB J E C T: C onsistent with G overnor G reg Abbott’s s uspens ion of various provisions of the O pen Meetings Act, effective Augus t 1, 2020 and until further notice, to reduce the c hance of C O VI D-19 trans mis s ion, all C ity of G eorgetown Advisory Board meetings will be held virtually. P ublic comment will be allowed via telec onference; no one will be allowed to appear in person. To partic ipate, please copy and paste the following weblink into your browser: Weblink: Join Mic ros oft Teams Meeting +1 512-672-8405 United S tates, Austin (Toll) C onference I D: 540 912 481# C itizen comments are ac cepted in three different formats : 1 . S ubmit written comments to s hirley.rinn@georgetown.org b y noon o n the d ate o f the meeting and the R ec o rd ing S ec retary will read your comments into the rec o rd ing d uring the item that is being dis cus s ed. 2. Log onto the meeting at the link above and “raise your hand” during the item 3. Us e your home/mobile phone to call the toll-free number To join a Teams meeting, c lick o n the link provid ed and join as an attend ee. Yo u will be asked to enter your name and email ad d res s (this is s o we c an identify you when yo u are c alled upon). To s p eak on an item, clic k o n the “R ais e your Hand” optio n at the bottom of the Teams meeting webpage o nc e that item has opened. W hen you are called up o n by the R ecording S ec retary, yo ur device will b e remo tely un-muted by the Adminis trato r and yo u may s p eak for three minutes. P leas e s tate your name c learly, and when yo ur time is over, your devic e will be muted again. Us e o f profanity, threatening language, sland ero us remarks or threats o f harm are no t allowed and will result in you being immediately removed from the meeting. IT E M S UMMARY: F IN AN C IAL IMPAC T: . S UB MIT T E D B Y: Danella Elliott Page 3 of 28 City of Georgetown, Texas Downtown T I RZ Board July 31, 2020 S UB J E C T: Dis cus s ion on how this virtual conferenc e will be conduc ted, to include options for public comments and how the public may address the C ommission – Mayor Dale R os s , C hair IT E M S UMMARY: F IN AN C IAL IMPAC T: . S UB MIT T E D B Y: Danella Elliott Page 4 of 28 City of Georgetown, Texas Downtown T I RZ Board July 31, 2020 S UB J E C T: Approval of the December 16, 2019 Wolf Lakes T I R Z Board Meeting minutes - Mayor Dale R os s , C hair IT E M S UMMARY: F IN AN C IAL IMPAC T: N/A S UB MIT T E D B Y: Danella Elliott AT TAC H ME N T S: Description Type Wolf Lakes TIRZ Minutes 12.16.19 Backup Material Page 5 of 28 Minutes of the WOLF LAKES TAX INCREMENT REINVESTMENT ZONE (TIRZ) BOARD City of Georgetown, Texas December 16, 2019 The WOLF LAKES TAX INCREMENT REINVESTMENT ZONE (TIRZ) Board of Directors met December 16, 2019 at 3:30 PM in the CITY HALL COMMUNITY ROOM, LOCATED AT 808 MARTIN LUTHER KING JR STREET, GEORGETOWN, TX. Board Members Present City Staff Present Dale Ross, Chair Laurie Brewer, Assistant City Manager Valerie Nicholson Wayne Reed, Assistant City Manager Steve Bohnenkamp Paul Diaz, Budget Manager David Morgan Michaela Dollar, Economic Dev Director Sofia Nelson Valerie Covey Board Members Absent Others Present Steve Fought Mayor Ross called the meeting to order at 3:30 p.m. Legislative Regular Agenda A Overview of the Wolf Lakes TIRZ Preliminary Project Plan – Laurie Brewer, Assistant City Manager Laurie noted that the Wolf Lakes Tax Increment Reinvestment Zone (TIRZ) was created around this time last year. There has not been any financial activity, but it is a state requirement to hold an annual meeting. She gave background on the TIRZ. The Wolf Lakes TIRZ Board of Directors includes the Mayor, Councilmember District 2, City Manager, City Planning Director, Member of City’s 4A Board and 2 representatives to be appointed by WILCO. Commissioner Val Covey will be one of the members, and they will appoint another at a later date. The purpose of the Zone is to provide economic and qualitative benefits by facilitating a program of public improvements that provide for the development of a mixed-use development with business/corporate offices, retail, entertainment, and enhanced quality of life features for residents. The location is at the NW corner of IH35 and its intersection with University Avenue (SH29), bounded by Wolf Ranch Parkway west and the River Hills subdivision to the north. Laurie explained how Tax Increment Financing (TIF) works, noting that it is a tool used by local governments to finance public improvements within an area that has unique challenges or opportunities. The creation of a TIRZ sets a base from which any additional taxes on increases in appraised value are set aside as a source to reimburse the developer for public improvement. Council set this TIF up as a reimbursement only, so the developer has to create that value, put in improvements and then get reimbursed at that time. Council felt that Wolf Lakes had strong corporate use opportunities and that retail will support office and residential and that mixed use provides additional sustainability. The Planned Unit Development (PUD) process provided a higher level of development standards that the developer was actually driving. They wanted to create an environment where they felt the assessed values would be higher. The developer estimates $1.7B in overall value after the buildout, vs. $460M from a previous plan for development. The City staff tends to be more conservative and projects from $900M to $1.4B. We agree that it will be an enhanced development, but not quite at the same place as the developer is. The TIF provides framework for performance-based reimbursement, so if the increment is not there, the developer doesn’t get reimbursed. Page 6 of 28 Commissioner Covey asked if any of this has changed from the original discussions on what would go there, and what the final decisions were. Laurie said that it hasn’t at this point. David said that so far, what has been active on the site (from the comments reviewed) is that we will likely start with some multi-family off of Wolf Ranch Parkway with the higher development standards and also working on very active interest in relation to office and retail. He said that there was some really hot interest for a while, and that has now cooled off some. One thing that was discussed is that this is a decade-long project and a great benefit is that the developer agreed to be structured into a PUD that requires more density and allows for a greater opportunity for stronger employment. Wolf Lakes TIRZ Summary: Paul Diaz, Budget Manager presented the following slide information on the financials: Laurie noted that the estimates include a mix of what the developer proposed and some of our experience factor in what we have seen in the past TIFs. To date, we haven’t seen 100% of what the developer says, so a projected number somewhere in the middle will give the developer a realistic view of what they will get reimbursed. There is also a cap due to the interest costs that accrue that could cause the TIF to go on indefinitely. David explained that the onsite infrastructure reimbursable estimate ($45.6M) includes County (for transportation, roads and stormwater) and City combined. We are just trying to be realistic on our expectations of the revenue. David addressed Commissioner Covey’s question about the structure and members of the TIRZ. David explained that from a Best Practices standpoint, it is cleaner if the developer represented is not a member of the board, as they would have to recuse themselves during voting. Discussion on questions and clarification of various items. Page 7 of 28 Adjournment Motion to adjourn at 3:26 p.m. by Dale Ross; second by David Morgan. Approved 6-0 __________________________________ ____________ Mayor Dale Ross Date Board Chair __________________________________ ____________ Danella Elliott (for Amy Mertink) Date Board Liaison Page 8 of 28 City of Georgetown, Texas Downtown T I RZ Board July 31, 2020 S UB J E C T: P res entation of the annual financ ial report for the Wolf Lakes Tax Increment R einves tment Zone – Laurie Brewer, As s is tant C ity Manager IT E M S UMMARY: An annual meeting of the T I R Z b o ard is req uired b y the by-laws. T his is traditio nally c o mp leted in late S ummer, so that the b o ard c an review the previo us year ’s financial ac tivity, as well as have a p review o f the upc oming budget proposal for the T I R Z. S P E C IAL C O N S ID E R AT ION S : C ouncil is sc heduled to ac t on all c omponents of the F Y2021 budget in August 2020. AT TAC HME N T S : P res entation, inc luding fund sc hedule, history, zone map, history F IN AN C IAL IMPAC T: N/A S UB MIT T E D B Y: Danella Elliott AT TAC H ME N T S: Description Type Wolf Lakes TIRZ Pres entation and Financial Report Pres entation Page 9 of 28 FY2021 Annual Budget Wolf Lakes TIRZ Fiscal Year 20 and 21 Budget Update Page 10 of 28 FY2021 Annual Budget What is TIF Financing? •Tax Increment Financing (TIF) is a tool local governments may use to finance public improvements within defined areas that have unique challenges or opportunities for economic development. –A municipality may make an area eligible for tax increment financing by designating a reinvestment zone (TIRZ). –Taxes on the appraised value of the zone in the year the zone was designated (the “base” year) continue flowing to the general funds of taxing units, but, for participating government units, all or part of the increased tax revenue due to greater real property values in TIF zone flows to a tax increment financing fund (“TIF or TIRZ”) for a specified maximum term of years. •Authorized by Texas Constitution and Chapter 311 of Tax Code Page 11 of 28 FY2021 Annual Budget Role of Board •Advisory to the Council –Council is final decision point for TIRZ activity •Board approves/recommends the project and funding plans •Annual meetings required to review financial activity Page 12 of 28 FY2021 Annual Budget Purpose: –The purpose of the Zone is to provide economic and qualitative benefits by facilitating a program of public improvements that provide for the development of a mixed-use development with business/corporate offices, retail, entertainment, and enhanced quality of life features for residents. Page 13 of 28 FY2021 Annual Budget Wolf Lakes TIRZ Background •NW corner of IH35 and its intersection with University Avenue (SH29), bounded by Wolf Ranch Parkway to the west and the River Hills subdivision to the north. Page 14 of 28 FY2021 Annual Budget Wolf Lakes TIRZ Boundaries Page 15 of 28 FY2021 Annual Budget Wolf Lakes TIRZ –Guiding Documents •Planned Unit Development •City TIRZ Ordinance –Project and financing plan •County TIF agreement •Developer Reimbursement Agreement (not yet developed) Page 16 of 28 FY2021 Annual Budget Why TIF for Wolf Lakes? •Strong corporate use opportunities –Retail will support office and residential •Mixed use provides additional sustainability •PUD provides higher level of development standards •Additional tax base generated due to design and density •Non-reimbursable project costs estimated at $978M –Developer estimates $1.7B versus $460M traditional –value at year 2050 •TIF provides framework for performance basedreimbursement Page 17 of 28 FY2021 Annual Budget Infrastructure Summary - Reimbursable •Onsite infrastructure $45.6M –Roads, utilities, drainage •Parking structures (5) $35M •Electric onsite and offsite $6.2M •Gas and fiber optic lines $2M •Offsite water and wastewater $1M •Memorial Drive and Traffic Impact off-site $3.5M •Common areas/open space/trails $8.2M •Total $102M •Interest/carrying costs also eligible for reimbursables up to revenue cap City of GeorgetownPage 18 of 28 FY2021 Annual Budget Summary –Property Taxes/TIF •Financials-TIF reimbursements –City TIF = estimated $91M over 30 years (70%) •City’s increment capped at $100M –County TIF = estimated $19M over 20 years (50%) •County’s capped at $30M for road and drainage only –Total TIF reimbursement -$130M •Cash generated through additional annual tax revenue •Base Year Value of 2018 = $4,627,127. •Reimbursement only –developer reimbursed as tax revenue is generated City of GeorgetownPage 19 of 28 FY2021 Annual Budget Summary –Property Taxes/TIF •Reimbursement –Developer not eligible for reimbursement until 150,000 of commercial improvements are made •Developer reimbursement agreement will be forthcoming once phasing plan is updated •If residential units increase above 2,500, additional county approval City of GeorgetownPage 20 of 28 FY2021 Annual Budget Assessed Value –Wolf Lakes LP Projection City of Georgetown 169,445,532 642,106,743 1,287,055,012 1,421,012,731 1,732,206,590 1,874,996,121 - 200,000,000 400,000,000 600,000,000 800,000,000 1,000,000,000 1,200,000,000 1,400,000,000 1,600,000,000 1,800,000,000 2,000,000,000 2020 2025 2030 2035 2045 2049 Wolf Lakes LP Projection Page 21 of 28 FY2021 Annual Budget FY2021 Budget •FY2021 revenues total $6,583 –City’s 70% increment is $3,845 –County’s 50% increment is $2,738 •Significant increases expected as property develops Page 22 of 28 FY2021 Annual Budget FY2021 Budget •FY2021 expenses total $5,000 –$10,000 for administrative costs •Fees for appraisal district, tax collection, accounting/finance, legal and city management Page 23 of 28 FY2021 Annual Budget Fund Schedule FY2019 Actuals FY2020 Budget FY2020 Projected FY2021 Base Budget FY2021 Changes FY2021 Budget Beginning Fund Balance - - - - - - Revenue FY2019 Actual FY2020 Budget FY2020 Projected FY2021 Base Budget FY2021 Changes FY2021 Budget Allocated Interest - - - - - Misc Revenue - - - 2,738 2,738 Property Taxes - - - 3,845 3,845 Grand Total - - - 6,583 6,583 Expense FY2019 Actual FY2020 Budget FY2020 Projected FY2021 Base Budget FY2021 Changes FY2021 Budget Bond Issuance Cost - - - - - - Administrative - Joint 2,500 - 2,500 Administrative - General - - - 2,500 2,500 Grand Total - - - 5,000 - 5,000 FY2019 Actuals FY2020 Budget FY2020 Projected FY2021 Base Budget FY2021 Changes FY2021 Budget Ending Fund Balance - - - 1,583 - 1,583 CAFR Adjustment - - - - - - Available Fund Balance - - - 1,583 - 1,583 Page 24 of 28 FY2021 Annual Budget Questions? City of GeorgetownPage 25 of 28 FY2021 Annual Budget Next Steps •Council reviews and adopts budget –August/September •Developer reimbursement agreement will be developed •New fiscal year begins October 1 Page 26 of 28 FY2021 Annual Budget Questions Page 27 of 28 City of Georgetown, Texas Downtown T I RZ Board July 31, 2020 S UB J E C T: IT E M S UMMARY: F IN AN C IAL IMPAC T: . S UB MIT T E D B Y: Danella Elliott Page 28 of 28