Municipal Factors:
  • Location - Map(s)
  • Access to transportation
  • Population
  • Economic conditions (include unemployment history)
  • Economic diversity (i.e., sector analysis)
  • Economic competitors
  • Major employers
  • Retail sales indicators
  • Income indicators
  • Major taxpayers
  • Building permit history and trend
  • Outstanding debt and additional debt planned
  • Growth potential

Agency Management:

  • Policy control rests where?
  • Separate or overlapping staff?
  • Powers?
  • Administrative costs

Private Partners:

  • Who?
  • History / background?
  • Covenants to perform?

Project Area:

  • Location and size of the project area - Map(s)
  • Location and access to transportation
  • If applicable, discussion of natural hazard risk(s) - reference attachment
  • If applicable, discussion of environmental risk(s) - reference attachment
  • Economic diversity (i.e., sector analysis)
  • Major employers (Analyze major taxpayer(s) / incremental value - may exceed 100%)
  • Zoning changes needed / approved?
  • Growth potential

Project area tax considerations:

  • FV history (5 years)
  • Real property vs personal property (at start and estimated at build out)
  • Land use within the project area (do analysis of increment by type of land use at start and at build out - NB: some undeveloped good because easily developed)
  • History of tax rates
  • History of assessment / tax appeals (describe assessment policies)
  • Property transfer policies
  • History of delinquencies - procedure for collection and foreclosure
  • Limitations and margin (include duration of increment set aside)
  • Major taxpayers (Any recent or significant changes?)
  • Do analysis of major taxpayers to incremental value - may exceed 100% individually (and likely in the aggregate)

Financing Plan:

Debt:

  • Security pledge
  • Additional security pledge(s)
  • Term (vs life of the district / pledge)
  • Flow of funds
  • Reserve Fund
  • Historic debt service coverage
  • Rate covenant (who controls tax rate and can you get a covenant to non-impair? How do we protect against changes in State tax law or assessment practices to non-impair?)
  • ABT (sb 1.25X or higher if concentration)
  • Variable / fixed
  • Direct vs overlapping debt (get range of tax rates in district / project area)

Coverage:

  • Historic coverage
  • Stress scenarios
  • Guarantors or other credit enhancement
  • Open / closed flow of funds

Documentation:

  • Agency resolution
  • Developer agreement
  • Tax collection agreement
  • Resolution / ordinance
  • Trust Indenture
  • Market study
  • Feasibility study
  • Cash flows
  • Guarantor information

Risks:

  • Change in economic conditions
  • Change in interest rates
  • Construction risk
  • Volatility in the value of commercial real estate - esp hotel and warehouses)
  • Downturn in residential real estate values
  • Tax appeals
  • Limited assessor's office
  • Limited tax collectors office
  • State law changes - tax rate, assessment practice
  • Changes in major employers or taxpayers
  • Purchase of foreclosed land by tax exempt entities - spin out to private sector within xx
  • High tax increment volatility for recently formed project areas
  • Real property vs personal property (sb <30% - moveable - careful car dealerships, airports, etc.)
  • Bankruptcy (federal a bankruptcy law supersedes local tax collection laws. Fed puts hold on tax collections)
  • Construction strikes

Attachments:

  • Local ordinance authorizing and defining DIF
  • Local ordinance defining and establishing the project area
  • Project plan
  • History of public hearings
  • Notice to overlapping / underlying municipal entities (excluding the Commonwealth) - If available their supporting ordinances or resolutions

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