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HomeMy WebLinkAbout09-10-18 City Commission Packet Materials - C4. Grant Agreement with Peach Street Property, LLC for Mixed-Use Project Commission Memorandum REPORT TO: Honorable Mayor and City Commission FROM: David Fine, Urban Renewal Program Manager SUBJECT: Authorize the City Manager to sign the Grant Agreement for a Midtown TIF Assistance Program Grant for “The Monarch” Mixed-Use Project at Peach Street Lot 1-A-2 MEETING DATE: September 10, 2018 AGENDA ITEM TYPE: Consent RECOMMENDATION: Authorize the City Manager to sign the Grant Agreement for the Midtown Urban Renewal Board’s award of up to $149,346.10 in incentive funds from the Midtown TIF Assistance Program for The Monarch mixed-use project. BACKGROUND: Pursuant to Resolution 4770, the Bozeman City Commission created the Midtown TIF Assistance Program (the “Program”) and authorized the Midtown Urban Renewal District Board (MURB) to administer the Program. While the Commission authorized the MURB to administer the program, the Commission required the placement of grant awards of over $50,000 on the City Commission consent agenda for ratification of the MURB’s award. The City Commission has final approval over TIF incentives exceeding this threshold. The applicant is proposing an infill project to construct a three-story building featuring two floors of commercial space and three apartments on the upper level. The site, located behind the Cellular Plus Verizon retail store on Peach Street, is constrained by existing infrastructure; a gas main must be relocated to construct the project. To make the project feasible, the Applicant is requesting $149,346.10 in TIF assistance to pay for demolition, impact fees, cash-in-lieu of parkland, cash-in-lieu of water rights, infrastructure connections, the relocation of the gas main, and off-site public infrastructure. A detailed list of eligible grant expenses is located on page 26 of the grant application. Based on tax generation model created by Leland Consulting /GEL Oregon, the project generates enough new incremental tax revenue to recoup the investment in 5.3 years.i 50 The recently adopted Midtown Urban Renewal District Action Plan promotes targeted, private investment with a specific vision for the corridor, based on the values of the urban renewal plan, which focuses on an increase in housing units and the promotion of urban density mixed use redevelopment. Staff finds that the grant award to The Monarch aligns with the Midtown Urban Renewal District Plan, the Midtown Action Plan, and the criteria of the Midtown TIF Assistance Program. The MURB voted 3-1 to approve the grant application. FISCAL EFFECTS: The $149,346.10 is paid as a reimbursement of costs incurred by the Applicant and will likely come due in Fiscal Year 2020. As grants are awarded at the time of occupancy permit, the award will most likely occur in FY 2020 and the proposed work plan and budget for that fiscal year will include specific authorization for this grant award. ATTACHMENTS: 1. Midtown TIF Assistance Program Grant Agreement 2. The Monarch TIF Assistance Program Grant Application Staff Report for the The Monarch Project 3. Leland Consulting Group/ GEL Oregon tax generation report 4. The Monarch Grant Application LINKS: Resolution 4770 – Midtown TIF Assistance Program Resolution 4781 – Midtown Urban Renewal District Action Plan Midtown Urban Renewal Plan (2015) i CORRECTION: The original tax generation analysis used a higher TIF assistance amount than the Applicant’s final request. There is also in an error in the Staff Report, as presented to the Midtown Urban Renewal Board and attached to this memorandum. In the report, staff divided the assistance amount by the “estimated net increase in taxable value” rather than by the “estimated incremental taxes”. This error explains why the Leland Consulting/GEL Oregon report shows a payback of 7.5 years, the Midtown URB Staff Report incorrectly shows a payback of 3.75 years, and this memorandum shows a payback of 5.3 years. We believe the estimated payback of 5.3 years is correct. 51 Midtown TIF Assistance Grant Agreement with Peach Street Property, LLC Page 1 MIDTOWN TIF ASSISTANCE PROGRAM GRANT AGREEMENT THIS GRANT AGREEMENT is made and entered into this ____ day of __________, 20__ by and between the City of Bozeman, Montana, a self-governing municipal corporation located at 121 N. Rouse Ave., Bozeman MT 59771 (“City”) as “Grantor” and Peach Street Property, LLC, a Limited Liability Corporation located at 321 East Mendenhall, Bozeman, MT 59715 as “Grantee.” WHEREAS, on December 16, 2015, the Bozeman City Commission adopted Ordinance 1925, the Bozeman Midtown Urban Renewal District Plan (“Plan”), defining the boundaries of the Bozeman Midtown Urban Renewal District (“District”) and delineating goals and strategies for eliminating blight, and authorizing the Bozeman Midtown Urban Renewal Board (“Board”) to act as the agency to exercise urban renewal powers; and WHEREAS, the Plan encourages commercial and residential development or redevelopment through the use of incentives, such as, but not limited to, public infrastructure support; and WHEREAS, the Board developed the Midtown Urban Renewal district Tax Increment Financing Assistance Program (“Midtown TIF Assistance Program”) to grant monies appropriated by the City Commission for grant assistance in the Board’s Annual Work Plan and Budget; and WHEREAS, on January 23, 2017 the Bozeman City Commission adopted Resolution No. 4770 establishing policies for the granting of funds by the Board to a requesting entity through the Midtown TIF Assistance Program; and WHEREAS, the intent of these funds is to offset the cost of redevelopment of substandard or “blighted” properties within the District; and WHEREAS, Grantee is the developer of The Monarch mixed-use development (the “Project”) to be located at 605 West Peach, Bozeman MT; and WHEREAS, Grantee presented a request to the Board for a grant of up to $149,346 to be used for demolition of existing structures, impact fees, and cash-in-lieu of parkland; and WHEREAS, on August 2, 2018 the Bozeman Midtown Urban Renewal Board approved the grant request in the amount of $149,346 (“grant award”) documented in the minutes of the August 2, 2018 meeting; and WHEREAS, on September 10, 2018, the City Commission approved the grant award. 52 Midtown TIF Assistance Grant Agreement with Peach Street Property, LLC Page 2 THE PARTIES AGREE: 1. The Grant. The City, through the Board, will grant and release to Grantee a sum of up to one hundred forty-nine thousand, three hundred forty-six dollars ($149,346) (the “Grant”) pursuant to the payment terms in Section 3. 2. Use of Grant Funds. a. Grant funds will be used by Grantee for the sole purpose of reimbursing demolition costs, impact fees, cash-in-lieu of parkland, cash-in-lieu of water rights, the provision of electricity and gas service to the site, and the connection to and the provision of public infrastructure as described in the approved grant application. b. Grant funds must be used within two years of the date of the execution date of this Agreement. Any funds not disbursed to the Grantee within that time will remain in the District fund. The Board, in its sole discretion, may provide an extension of up to one year to the original two year timeframe. c. Use of TIF assistance funds must be in compliance with the terms of this Grant Agreement. 3. Payment of Grant Funds a. The Grant payment will be applied toward reimbursement of demolition costs, impact fees, cash-in-lieu of parkland, cash-in-lieu of water rights the provision of electricity and gas service to the site, and the connection to and the provision of public infrastructure as described in the approved grant application, following the issuance of the certificate of occupancy for the Project, unless the Board reasonably determines, in its sole discretion, Grantee has failed to meet its obligations pursuant to sections 2, 3(b), 4, 5, 9, or 10 of this Agreement. b. Should Grantee receive additional funding for the Project from other funding sources, or if for any other reason Grantee requires less than $149,346 to fully fund the Project, it will notify the Board of such reduction in need as soon as reasonably possible and the Board may reduce the amount of the Grant and the payment(s) of Grant funds. 53 Midtown TIF Assistance Grant Agreement with Peach Street Property, LLC Page 3 4. Grantee Representations. Grantee represents and warrants to City: a. Grantee has familiarized itself with the nature and extent of this Grant Agreement, the contents of Resolution 4770 (attached hereto as Exhibit A) and with all local conditions and federal, state and local laws, ordinances, rules, and regulations that in any manner may affect Grantee’s obligations under this Grant Agreement. b. Grantee has familiarized itself with applicable City of Bozeman procurement regulations related to bidding, hiring, and prevailing wages and agrees to comply with such regulations if applicable. c. Grantee has the power to enter into and perform this Grant Agreement. d. The Grant funds are necessary to accomplish the financing requirements of the Project. 5. Reports/Accountability/Public Information. Grantee agrees to develop and/or provide such documentation as requested by the Board demonstrating Grantee’s compliance with the requirements of this Grant Agreement. Grantee shall allow the Board or the City, its auditors, and other persons authorized by the Board to inspect and copy its books and records for the purpose of verifying that monies provided to Grantee pursuant to this Grant Agreement were used in compliance with this Grant Agreement and all applicable provisions of federal, state, and local law. Grantee will retain such records for fifteen years after receipt of final payment under this Agreement unless permission to destroy them is granted by the Board. 6. Default and Termination. If Grantee fails to comply with any condition of this Grant Agreement at the time or in the manner provided for, the City may terminate this Agreement if the default is not cured within thirty (30) days after written notice is provided to Grantee. The notice will set forth the items to be cured. If this Grant Agreement is terminated pursuant to this Section, Grantee will repay to the City any Grant funds already disbursed to Grantee or applied toward impact fees or cash-in-lieu owed by Grantee for the Project. 7. Limitation on Grantee’s Damages; Time for Asserting Claim a. In the event of a claim for damages by Grantee under this Grant Agreement, Grantee hereby expressly waives any right to claim or recover consequential, special, punitive, lost business opportunity, lost productivity, field office overhead, general conditions costs, or lost profits damages of any nature or kind. 54 Midtown TIF Assistance Grant Agreement with Peach Street Property, LLC Page 4 b. In the event Grantee wants to assert a claim for damages of any kind or nature, Grantee shall provide City with written notice of its claim, the facts and circumstances surrounding and giving rise to the claim, and the total amount of damages sought by the claim, within ninety (90) days of the facts and circumstances giving rise to the claim. In the event Grantee fails to provide such notice, Grantee shall waive all rights to assert such claim. 8. Representatives a. City’s Representative. The City’s Representative for the purpose of this Agreement shall be David Fine or such other individual as City shall designate in writing. Whenever approval or authorization from or communication or submission to City is required by this Agreement, such communication or submission shall be directed to the City’s Representative and approvals or authorizations shall be issued only by such Representative; provided, however, that in exigent circumstances when City’s Representative is not available, Grantee may direct its communication or submission to other designated City personnel or agents and may receive approvals or authorization from such persons. b. Grantee’s Representative. Grantee’s Representative for the purpose of this Grant Agreement shall be Julien Morice, or such other individual as Grantee shall designate in writing. Whenever direction to or communication with Grantee is required by this Agreement, such direction or communication shall be directed to Grantee’s Representative; provided, however, that in exigent circumstances when Grantee’s Representative is not available, City may direct its direction or communication to other designated Grantee personnel or agents. 9. Indemnity/Waiver of Claims/Insurance. To the fullest extent permitted by law, Grantee agrees to defend, indemnify and hold the City and its agents, representatives, employees, and officers (collectively referred to for purposes of this Section as the City) harmless against all third party claims, demands, suits, damages, losses, and expenses, including reasonable defense attorney fees, which arise out of, relate to or result from Grantee’s (i) negligence or (ii) willful or reckless misconduct. Such obligations shall not be construed to negate, abridge, or reduce other rights or obligations of indemnity that would otherwise exist. The indemnification obligations of this Section must not be construed to negate, abridge, or reduce any common-law or statutory rights of the indemnitee(s) which would otherwise exist as to such 55 Midtown TIF Assistance Grant Agreement with Peach Street Property, LLC Page 5 indemnitee(s). Grantee’s indemnification obligations under this Section shall be without regard to and without any right to contribution from any insurance maintained by City. Should any indemnitee described herein be required to bring an action against Grantee to assert its right to defense or indemnification under this Grant Agreement or under Grantee’s applicable insurance policies required below the indemnitee shall be entitled to recover reasonable costs and attorney fees incurred in asserting its right to indemnification or defense but only if a court of competent jurisdiction determines Grantee was obligated to defend the claim(s) or was obligated to indemnify the indemnitee for a claim(s) or any portion(s) thereof. In the event of an action filed against City resulting from the City’s performance under this Grant Agreement, the City may elect to represent itself and incur all costs and expenses of suit. Grantee also waives any and all claims and recourse against the City or its officers, agents or employees, including the right of contribution for loss or damage to person or property arising from, growing out of, or in any way connected with or incident to the performance of this Grant Agreement except “responsibility for his own fraud, for willful injury to the person or property of another, or for violation of law, whether willful or negligent” as per 28-2-702, MCA. These obligations shall survive termination of this Grant Agreement. In addition to and independent from the above, Grantee shall at Grantee’s expense secure insurance coverage through an insurance company or companies duly licensed and authorized to conduct insurance business in Montana which insures the liabilities and obligations specifically assumed by Grantee in this Section. The insurance coverage shall not contain any exclusion for liabilities specifically assumed by Grantee in this Section. The insurance shall cover and apply to all claims, demands, suits, damages, losses, and expenses that may be asserted or claimed against, recovered from, or suffered by the City without limit and without regard to the cause therefore in amounts not less than as follows: • Workers’ Compensation – statutory; • Employers’ Liability - $1,000,000 per occurrence; $2,000,000 annual aggregate; • Commercial General Liability - $1,000,000 per occurrence; $2,000,000 annual aggregate 56 Midtown TIF Assistance Grant Agreement with Peach Street Property, LLC Page 6 The City of Bozeman, its officers, agents, and employees, shall be endorsed as an additional or named insured on a primary non-contributory basis on the Commercial General policy. The insurance and required endorsements must be in a form suitable to City and shall include no less than a thirty (30) day notice of cancellation or non- renewal. The City must approve all insurance coverage and endorsements prior to disbursement of Grant funds. Grantee shall notify City within two (2) business days of Grantee’s receipt of notice that any required insurance coverage will be terminated or Grantee’s decision to terminate any required insurance coverage for any reason. 10. Nondiscrimination. Grantee agrees that all hiring by Grantee of persons performing this Grant Agreement shall be on the basis of merit and qualifications. Grantee will have a policy to provide equal employment opportunity in accordance with all applicable state and federal anti-discrimination laws, regulations, and contracts. Grantee will not refuse employment to a person, bar a person from employment, or discriminate against a person in compensation or in a term, condition, or privilege of employment because of race, color, religion, creed, political ideas, sex, age, marital status, national origin, actual or perceived sexual orientation, gender identity, physical or mental disability, except when the reasonable demands of the position require an age, physical or mental disability, marital status or sex distinction. Grantee shall require these nondiscrimination terms of its subcontractors providing services under this Grant Agreement. 11. Attorney’s Fees and Costs. In the event it becomes necessary for a party to this Agreement to retain an attorney to enforce any of the terms or conditions of this Agreement or to give any notice required herein, then the prevailing party shall be entitled to reasonable attorney’s fees and costs, including fees, salary, and costs of in- house counsel to include City Attorney. 12. Integration and Modification. This document contains the entire agreement between the parties and no statements, promises or inducements made by either party or agents of either party not contained in this written Agreement may be considered valid or binding. This Agreement may not be modified except by written agreement signed by both parties. 57 Midtown TIF Assistance Grant Agreement with Peach Street Property, LLC Page 7 13. Dispute Resolution a. Any claim, controversy, or dispute between the parties, their agents, employees, or representatives shall be resolved first by negotiation between senior-level personnel from each party duly authorized to execute settlement agreements. Upon mutual agreement of the parties, the parties may invite an independent, disinterested mediator to assist in the negotiated settlement discussions. b. If the parties are unable to resolve the dispute within thirty (30) days from the date the dispute was first raised, then such dispute may only be resolved in a court of competent jurisdiction in compliance with the Applicable Law provisions of this Agreement. 14. No Assignment. Grantee may not subcontract or assign Grantee’s rights, including the right to Grant payments, or any other rights or duties arising hereunder, without the prior written consent of City. 15. No Third Party Beneficiary. The terms and provisions of this Agreement are intended solely for the benefit of each party and their respective successors and assigns. It is not the parties’ intent to confer third party beneficiary rights upon any other person or entity. 16. Choice of Law. This Agreement shall be governed and construed in accordance with the laws of the State of Montana without regard to conflict of law provisions. The Parties agree to submit to the personal and exclusive jurisdiction of the courts located within Gallatin County, Montana. 17. Non-Waiver. A waiver by either party of any default or breach by the other party of any terms or conditions of this Agreement does not limit the other party’s right to enforce such term or conditions or to pursue any available legal or equitable rights in the event of any subsequent default or breach. 18. Severability. If any portion of this Agreement is held to be void or unenforceable, the balance of the Agreement shall continue in effect. 19. Counterparts. This Agreement may be executed in counterparts, which together constitute one instrument. **** END OF AGREEMENT EXCEPT FOR SIGNATURES **** 58 Midtown TIF Assistance Grant Agreement with Peach Street Property, LLC Page 8 59 Midtown TIF Assistance Grant Agreement with Peach Street Property, LLC Page 9 IN WITNESS WHEREOF, the parties hereto have executed this instrument the day and year indicated below. _______________________ Date: __________ ___________, City Manager City of Bozeman STATE OF MONTANA ) : ss. County of Gallatin ) On this ______ day of __________________, 20__, this instrument was acknowledged before me by _________________ as City Manager of the City of Bozeman, a self-governing municipal government. ______________________________________ Notary Public for the State of Montana Printed Name: __________________________ Residing at: ____________________________, Montana My commission expires: _______________ _______________________ Date: __________ _______________________ [print name] _______________________ [title] [Grantee name] STATE OF MONTANA ) : ss. County of Gallatin ) On this ______ day of __________________, 20__, this instrument was acknowledged before me by _________________________, as _______________[title] of Peach Street Property , LLC, a limited liability corporation. ______________________________________ Notary Public for the State of Montana Printed Name: __________________________ Residing at: ____________________________, Montana My commission expires: _______________ 60 EXHIBIT A CITY OF BOZEMAN RESOLUTION 4770 61 Midtown TIF Assistance Program Grant Application Staff Report “Monarch” Peach Street Property, LLC, Peach Street Lot 1-A-2 Date: July 13, 2018 To: Midtown Urban Renewal District Board From: David Fine, Economic Development Specialist Overview This project application is the third received under the new Midtown TIF Assistance Program. The new program places special emphasis on the five goals articulated in the urban renewal plan for relieving blighted conditions in the urban renewal area. Each of these five goals is further refined with particular criteria for a total of sixteen categories in which points can be received. In many categories, specific documentation must be received in order to receive points. The new program is designed to move away from the previous façade grant program to support projects that reinforced the goals of the new urban renewal plan, as well as projects that create significant new taxable value. Criteria for TIF Assistance Overall District Relevance 1. Relevance to the Midtown Urban Renewal Plan: Documentation of the project’s impact in relation to the goals and objectives of the Midtown Urban Renewal Plan, particularly mixed-use development. Urban design elements are also considered, including pedestrian emphasis and quality of design. The project eliminates blight by demolishing a vacant and depreciating parking lot and replacing it with a contemporary building that adds retail, office space, and housing units and increases the taxable value of the property use. This 21,884 gross square foot vertical mixed-use project locates a new building closer to the street adding interest and activity. The project and creates spaces for long-term traded sector and retail jobs. [5 of 5] Promote Economic Development 2. Tax Generation: The project will increase the taxable value within the District. The increase in taxable value due to new construction & rehabilitation is estimated by the County Assessor’s office or State Department of Revenue to determine tax increment generation. Submit documentation of estimated tax projections to receive points for these criteria. Leland Consulting Group (LCG) created a tax revenue generation model for the Midtown URD. Using data provided by the property owner, LCG estimates that the property will provide an annual net tax revenue increase of $39,829 for the District. The new construction value of the new property is 62 $2,073,588 which represents a $1,270,000 increase in the value of the property. For the assumptions related to these projections, please see the LGC report. [4 of 4] 3. Elimination of Blight: The project’s direct and indirect impact on the physical and fiscal deterioration within the Tax Increment Financing District and the community. Submit information showing current conditions of property. The project eliminates blight by replacing a vacant parking lot with a 21,884 gross square foot vertical mixed-use building that adds 3 housing units and increases the density of development on the property. [4 of 4] 4. Employment Generation: Total employment generated by the project assessed in terms of new permanent and part-time jobs, and construction jobs. Submit documentation of estimated new jobs to receive points for this criterion. The project will generate temporary construction jobs. The inclusion of commercial and retail space in the project provides 7443 square feet of new space for employment. No specific tenants are associated with this application. [1 of 3] Improve Multi-Modal Transportation 5. Facilitates Public Health and Mobility: Project will construct or improve sidewalks, including ADA access to buildings. Provide detailed information demonstrating that the current condition inhibits public health and mobility. The new building will be ADA accessible. [1 of 1] 6. Reduces Resource Demand: Project promotes the use of transit, ride sharing, or car sharing. Provide plans, agreements or other methods to demonstrate reduction of resource demand. While locating housing and commercial development in Midtown places it in a centrally located location, this project does not take particularly exceptional or innovative measures to promote transit use, ride sharing, or car sharing. [0 of 1] 7. Promotes Active Transportation: Project promotes bicycling as an active transportation option by constructing or improving bike lanes, providing covered bike parking, and/or participating in a bike share program. Provide plans, agreements or other methods to demonstrate reduction of resource demand. No qualifying covered bike parking is proposed. [0 of 1] Improve, Maintain, and Support Innovation in Infrastructure 8. Infrastructure Improvements: Project promotes innovation in infrastructure and/or reduces long- term costs of maintenance. Provide plans and descriptions of innovations proposed. 63 The project, with TIF Assistance, plans to extend and utilize the City of Bozeman fiber conduit system. The project will relocate Northwestern Energy utilities servicing other parcels that essentially made the Monarch site undevelopable. [2 of 2] Promote Unified Human Scale Urban Design 9. Street Frontage: The project improves the street frontage by eliminating parking between the right- of-way and the building. Provide plans to demonstrate improvement in street frontage. The building removes a residential driveway from the front of the building and all parking is tucked under the building with a driveway on the side of the building. Moving parking to the side and rear of structures is a new code requirement and is consistent with the vision of the Midtown Urban Renewal Plan. [2 of 2] 10. Vehicular Access Points: The project reduces the number of vehicular access points to the property and improves the pedestrian experience. Provide plans, agreements or other methods to demonstrate reduction. The Monarch developer acquired an easement from the adjacent property (Cellular Plus) that allowed the Monarch to share the existing drive approach rather than creating a new approach. [1 of 2] 11. Street Orientation: The project enhances the North 7th Ave. entryway corridor by having buildings oriented toward the street and designed to provide interest and activity. The proposed structure would orient the structure toward the street and provide new interest and activity. The developer is in the process of evaluating raising the first level to ground level, which would enhance visual interest and allow the developer to receive full points in this category. [2 of 3] 12. Pedestrian Experience: The project enhances the pedestrian experience with elements such as façade transparency, building articulation, street furniture and/or landscaping. Submit plans and details that address this criterion. The project provides some enhanced façade transparency and new landscaping along Peach St. frontage. The building could do more to engage the street and enhance the public realm through the use of enhanced landscaping and a raising the first floor to street level. No landscaping plan was submitted with this application. [1 of 3] 13. Quality of the Development Exceeds Minimum Requirements. The quality of development and overall aesthetics (architectural, site design, landscaping, etc.) are beyond that which is minimally required by the UDC. Submit documentation to demonstrate compliance with this criterion. Based on preliminary renderings, the project as proposed appears to exceed the minimal requirements of the UDC for architecture, site design, and landscaping. [2 of 2] 64 Support Compatible Urban Density Mixed Land Uses 14. Increases Housing Units: The project increases housing units within the District. Submit plans demonstrating an increase in the number of housing units. The project includes three residential units. [3 of 4] 15. Mix of Uses Including Residential: The project has a mix of uses, including residential. Submit plans detailing the proposed mix of uses within the project. The project includes a mix of uses. [4 of 4] 16. Shared Parking: The project shares parking among compatible uses. Provide details demonstrating compliance with the UDC and as well as total number of parking spaces reduced because of a shared arrangement. The project provides parking for its uses and does not share parking among compatible uses. Future more detailed plans for parking could show a shared parking arrangement to receive points for this category. [0 of 2] Total Points (32/44) Staff Recommendation The Midtown TIF Assistance Program allows the payment of eligible costs of development to incentivize development that meets the goals of the urban renewal plan. The applicant is applying for several eligible cost areas totaling $149,346.10 (An earlier draft of this proposal requested $169.346.10 in expenditures. After a discussion with staff about cost eligibility, the applicant revised their application.) Staff finds that the proposed costs are eligible for TIF assistance. Leland Consulting Group (LCG) completed a financial analysis of the project (attached) to help staff evaluate the project. Their report analyzed return on investment (ROI), estimated payback period for the public assistance and proposed target metrics for the ratio of private investment to public assistance. Their analysis was based on awarding the applicant’s full assistance request. LCG recommends a ratio of private investment to public assistance of 8:1 or greater for commercial projects; the ratio for this project is 14.11:1. LCG also created a tax generation model for the Midtown URD. According to their model, the project would produce net new annual taxes of $39,829, which would allow TIF assistance to be paid back in 3.75 years1 for new increment-based payback if assistance is provided at the staff recommended amount. This level of increment generation to payback ensures that the proposed project will contribute to the long-term ability of the District to make investments in new projects. Staff scored the application based on the program criteria. Based on our review and the application materials presented, the project received 32 of 44 available points. The project eliminates blight and advances the District goal of creating urban density land uses and providing increased housing stock within the District to drive further commercial development. 1 Please see the correction to this item in the City Commission Memo. 65 Staff recommends authorizing staff to negotiate a development agreement with the Applicant for presentation to the Bozeman City Commission for approval. Recommended motion: “I move to authorize staff to negotiate a development agreement with the Applicant for TIF Assistance not-to-exceed $149,346.10 and to recommend the Monarch project for TIF Assistance to the Bozeman City Commission.” 66 Peach  Street  Property,  LLC Tax  Increment  Analysis June  27,  2018 Prepared  by: Andy  Parks,  CPA Leland  Consulting/GEL  Oregon,  Inc. on  behalf  of  the  City  of  Bozeman  Economic  Development  Department Summary Applicant  plans  to  build  a  mixed-­‐use  commercial/residential  building  located  in  the  heart  of  Bozeman's  Midtown  District.   Applicant  plans  to  invest  approximately  $2.074  million  and  is  requesting  $169,346  from  the  Agency. The  following  schedule  summarizes  our  findings  of  our  analysis. Estimated  construction  costs  to  complete  project 2,073,588$               Estimated  capitalized  interest  46,656                                   Less:  2017  market  value  per  assessor   (improvements  only)12,910                                   Net  estimated  increase  in  value 2,107,334                     Estimated  net  increase  in  taxable  value 39,829                                   TIF  tax  rate  -­‐  estimated  -­‐  FY  2020 707.66                                   Estimated  incremental  taxes  (TIF)  -­‐  annual  28,185                                   TIF  investment 169,346                             ROI  -­‐  estimated 16.6% Estimated  payback  period    (years)7.5                                                    assumes  5.0%  interest  rate  on  advanced  amount Private  investment  to  public  investment  11.24                                        Metric:   Greater  than  8  to  1  -­‐  commercial Greater  than  5  to  1  -­‐  family  wage  jobs Assumptions Cost  and  timing  information  provided  in  application  -­‐  except  construction  financing  which  is  estimated Estimated  start  date  Aug-­‐18 Estimated  completion  per  application  is  approximately  10  months May-­‐19 Spring  2019 Increase  in  property  taxes  applicable  fiscal  year  2020 Construction  Interest  -­‐  estimated 46,656                             12  month  construction  loan  rate 6.00%Note:  estimated  commercial  rate Current  property  taxes -­‐                                               Estimated  Financing  Cost  -­‐  Construction Construction  Financing Project  Costs Amount Beg  Month Ending   Month Months  of   Interest Estimated   Interest Aug 207,359                            9                                      9,331                           Sept 207,359                            8                                      8,294                           Oct 207,359                            7                                      7,258                           Nov 207,359                            6                                      6,221                           Dec 207,359                            5                                      5,184                           Jan 207,359                            4                                      4,147                           Feb 207,359                            3                                      3,110                           Mar 207,359                            2                                      2,074                           Apr 207,359                            1                                      1,037                           May 207,359                            -­‐                            -­‐                                       Estimated  cost  to  complete 2,073,588                    46,656                     Note:  Financing  cost  assues  10  month  construction  period,  equal  monthly  expenditures  throughout  construction. Analysis  has  been  performed  to  determine:  Return  on  Investment  (ROI),  Estimated  payback  period  and  metrics  related  to   private  to  public  sector  investment http://gis.gallatin.mt.gov/common/parcel_informati on.aspx?tab=taxcode&taxID=RGG3097&geocodeid=0 6079801405070000 Greater  than  10  to  1  -­‐  desired  for  multi-­‐ family Property  valuation  is  limited  to  the  cost  approach,  i.e.,  cost  to  complete  project  -­‐  real  market  value  will  likely  differ.   Different  valuation  methods  include  but  are  not  limited  to;  income  approach,  sales  comparisons,  and  Capital  Asset  Pricing   Model.   67 BOZEMAN MIDTOWN TIF ASSISTANCE REQUEST MONARCH 68 MONARCH \\ COMMERCIAL SPACE & URBAN LIVING 615 WEST PEACH STREET \\ BOZEMAN MONTANA Bozeman Midtown TIF Assistance Request PROPERTY INFORMATION • APPLICANT INFORMATION • COMPANY PROFILE • PROJECT DETAIL PART 1 69 Midtown Urban Renewal District TAX INCREMENT FINANCING APPLICATION PART 1 Property Information Property Address: ____________________________________________________________ Property Owner: _____________________________________________________________ Legal Description: ____________________________________________________________ Property Geo-Code: __________________________________________________________ County Tax ID #: ____________________________________________________________ Applicant Information  Property Owner  Tenant  Developer  Other Applicant’s primary contact: Name: ________________________________________________________________________ Business Name: _________________________________________________________________ Business Phone: _______________________________Cell Phone: _______________________ Email: ________________________________________ Project Representative (if not applicant): Name: ________________________________________________________________________ Business Name: _________________________________________________________________ Business Phone: _______________________________Cell Phone: _______________________ Email: ________________________________________ Property Owner (if not applicant): Name: ________________________________________________________________________ Business Name: _________________________________________________________________ Business Phone: _______________________________Cell Phone: _______________________ Email: ________________________________________ Peach Street / Lot 1-A-2 Peach Street Property, LLC SHONKWILER ADD, S01, T02 S, R05 E, Lot 1-A-2, PLAT E-4-B 06-0798-01-4-05-52-0000 RGG69323 4 4 Julien Morice Peach Street Property, LLC 406-581-9999 406-581-9999 j@ironwoodd.com Jenn Clary Encompass V2 LLC 406-540-4437 406-880-2841 jenn@encompassv2.com 70 Page 6 of 13 Midtown Urban Renewal District TIF Assistance Revised January 2017 Please attach a list of all other property owners, business partners, developers and/or investors associated with this project, with the above information provided for each. This application must be signed by both the applicant(s) and the property owner(s) (if different). I (we), by signature below, certify that the information supplied in this application is, to the best of my (our) knowledge, true, accurate, and complete, and is provided for the purpose of obtaining approval to participate in the Midtown Urban Renewal District TIF assistance program. I (we) understand that failure to comply with the terms of the TIF assistance program may result in revocation of an award. I (we) understand the work to be undertaken must be in accordance with all applicable requirements of the Bozeman Municipal Code and any special conditions established by the approval authority, and must receive all required approvals prior to commencing the work. I (we) understand if approved for TIF assistance, the work to be performed must also be in accordance with TIF assistance program procedures and the general design guidelines for the District, as well as the specific plans approved for the project. I (we) acknowledge that the City has an Impact Fee Program and impact fees may be assessed for my project. Further, I (we) agree to grant City personnel and other review agency representative’s access to the subject site during the course of the review process (Section 38.34.050, BMC). Applicant (s) (Print Name) Signature of Applicant Date Property Owner(s) (Print Name) Signature of Property Owner Date Julien Morice 06/08/2018 Peach Street Property, LLC 06/08/2018 71 Page 7 of 13 Midtown Urban Renewal District TIF Assistance Revised January 2017 Company Profile Business Location  New business establishing itself in Bozeman  Existing business  Expanding/remodeling at same location  Expanding to an additional location  Existing business relocating from (identify location): Street Address: City: State: Zip:  Other: Year Business Established: Type of Business (Describe): Has a business plan been developed in relation to the proposed project?  No (Development of a business plan may be required as part of the application process.)  Yes (Include a copy with the application.) 605 West Peach Street Bozeman MT 59715 2018 Mixed-Use Office/Residential 72 Page 8 of 13 Midtown Urban Renewal District TIF Assistance Revised January 2017 Project Detail Property Status:  Vacant land  Building on leased land – Describe:  Land and building(s) – Describe: Type of TIF Assistance Sought:  Requesting assistance for public infrastructure costs  Building demolition Value of TIF Assistance Sought: $ Will this project proceed if TIF assistance is not granted?  No  In a limited fashion (explain):  Yes, but at a later date (explain):  Yes, as scheduled  Other: 1. Project Narrative Provide an overview of the project in narrative format. The narrative must include a description of the following aspects of the project:  Proposed use(s) or project (e.g. industrial, commercial, retail, office, mixed use, residential for sale or for rental, etc.)  Construction information about the project including size of any existing structure to be demolished or rehabbed; sized of any new construction; types of construction materials (structural and finish); delineation of square foot allocation by use;  Total number and individual square footage of residential units; type of residential units (e.g. for-sale, rental, condominium, single-family, etc.); number and type of parking spaces provided; and construction phasing. 73 Page 9 of 13 Midtown Urban Renewal District TIF Assistance Revised January 2017 2. Site Maps and Building Plans The Applicant must submit a completed Conceptual Review Application to the Board and concurrently to the Community Development Department. The Conceptual Review application must include, at minimum:  Photographs of project site and/or building  Map showing the location of the site and its immediate surroundings  Proposed development plans including site plans, floor plans indicating square footage and layout, building elevations  Description of parking accommodations for residential units and commercial uses  Estimated date of occupancy Prior to Board action on the grant application, the Applicant must have obtained and provide to the Board the Community Development Director’s written comments on the proposed development from the Conceptual Review Application. 74 Page 10 of 13 Midtown Urban Renewal District TIF Assistance Revised January 2017 CRITERIA FOR TIF ASSISTANCE In reviewing the TIF assistance application the Board will evaluate each project utilizing the following criteria and point system. Points can range from 0 to the maximum shown below in each category. Please rate your project according to the following criteria. To receive points for any given item, documentation demonstrating adherence to the criteria must be submitted with the application. The Board will use this information to evaluate the project. Overall District Relevance Points 1. Relevance to the Midtown Urban Renewal Plan – Documentation of the project’s impact in relation to the goals and objectives of the Midtown Urban Renewal Plan, particularly mixed-use development. Urban design elements will also be considered, including pedestrian emphasis and quality of design. /5 Promote Economic Development 2. Tax Generation: The project will increase the taxable value within the District. The increase in taxable value due to new construction & rehabilitation is estimated by the County Assessor’s office or State Department of Revenue to determine tax increment generation. Submit documentation of estimated tax projections to receive points for this criteria /4 3. Elimination of Blight – The project’s direct and indirect impact on the physical and fiscal deterioration within the Tax Increment Financing District and the community. Submit information showing current conditions of property. /4 4. Employment Generation – Total employment generated by the project assessed in terms of new permanent and part-time jobs, and construction jobs. Submit documentation of estimated new jobs to receive points for this criterion. /3 Improve Multi-Modal Transportation 5. Facilitates Public Health and Mobility: Project will construct or improve sidewalks, including ADA access to buildings. Provide detailed information demonstrating that the current condition inhibits public health and mobility. /1 6. Reduces Resource Demand: Project promotes the use of transit, ride sharing, or car sharing. Provide plans, agreements or other methods to demonstrate reduction of resource demand. /1 7. Promotes Active Transportation: Project promotes bicycling as an active transportation option by constructing or improving bike lanes, providing covered bike parking, and/or participating in a bike share program. Provide plans, agreements or other methods to demonstrate reduction of resource demand. /2 Improve, Maintain and Support Innovation in Infrastructure 8. Infrastructure Improvements: Project promotes innovation in infrastructure and/or reduces long term costs of maintenance. Provide plans and descriptions of innovations proposed. /2 5 4 4 3 1 1 2 2 75 Page 11 of 13 Midtown Urban Renewal District TIF Assistance Revised January 2017 Promote Unified Human Scale Urban Design 9. The project improves the street frontage by eliminating parking between the right-of-way and the building. Provide plans to demonstrate improvement in street frontage. /2 10. The project reduces the number of vehicular access points to the property and improves the pedestrian experience. Provide plans, agreements or other methods to demonstrate reduction. /2 11. The project enhances the North 7th Ave. entryway corridor by having buildings oriented toward the street and designed to provide interest and activity. /3 12. The project enhances the pedestrian experience with elements such as façade transparency, building articulation, street furniture and/or landscaping. Submit plans and details that address this criterion. /3 13. The quality of development and overall aesthetics (architectural, site design, landscaping, etc.) are beyond that which is minimally required by the UDC. Submit documentation to demonstrate compliance with this criterion. /2 Support Compatible Urban Density Mixed Land Uses 14. The project increases housing units within the District. Submit plans demonstrating an increase in the number of housing units. /4 15. The project has a mix of uses, including residential. Submit plans detailing the proposed mix of uses within the project. /4 16. The project shares parking among compatible uses. Provide details demonstrating compliance with the UDC and as well as total number of parking spaces reduced because of a shared arrangement. /2 Total Points /44 APPROVAL (For Official Use Only) Approval Status: Date Approved: Date Letter of Award Sent: Date Certificate of Completion: Date of Payment Request: 2 2 3 3 2 4 4 2 44 76 PROJECT INFO MONARCH PROJECT ARCHITECTPROJECT MANAGER PROJECT NAME Spring 2019 ESTIMATE DATE OF OCCUPANCY PROPERTY INFO Physical Address: 605 West Peach Street Bozeman, MT 59715 Legal Description: SHONKWILER ADD, S01, T02 S, R05 E, Lot 1-A-2, PLAT E-4-B Property Geo-Code: 06-0798-01-4-05-52-0000 County Tax ID: RGG69323 Property Owner: Peach Street Property, LLC Julien Morice Ironwood Development 406-581-9999 j@ironwoodd.com Jenn Clary Encompass V2, LLC 406-540-4437 jenn@encompassv2.com PROJECT DESCRIPTION The Monarch is a mixed-use commercial/residential building located in the heart of Bozeman’s Midtown District. This building will provide two commercial units with a shared common break room and restrooms on the basement floor and two commercial units with a shared common break room and restrooms on the main floor for office use. Three residential units will resided on the upper floor. Bozeman Midtown TIF Assistance Request MONARCH \\ COMMERCIAL SPACE & URBAN LIVING 615 WEST PEACH STREET \\ BOZEMAN MONTANA 77 A B M1 L1 C M2 L2 UPPER LEVEL The upper level includes three residential units. The open concept floor plan includes high ceilings, large windows, air conditioning, private patios, high-speed internet fiber and one designated parking space per unit. Unit A & C • 1,086 Sq Ft • 117 Sq Ft Patio • 2 Bedroom + 2 Bath • Stainless Steel Appliances • Quartz Countertops • Vaulted Ceilings in Living Room & Master • Stackable Washer/Dryer • Gas Fireplace Unit B • 420 Sq Ft • 126 Sq Ft Patio • 1 Bath • Stainless Steel Appliances • Quartz Countertops • Stackable Washer/Dryer MAIN LEVEL The main level includes two commercial units with a shared common break room and restrooms. Each unit includes large windows, spacious patio areas, high-speed internet fiber and two entrances. Unit M1 • 2,130 Gross Sq Ft • 380 Sq Ft Shared Patio • 652 Sq Ft Side Patio • Shared Break room & Restrooms • High-Speed Internet Fiber Unit M2 • 1,923 Gross Sq Ft • 380 Sq Ft Shared Patio • 445 Sq Ft Side Patio • Shared Break Room & Restrooms • High-Speed Internet Fiber MONARCH \\ COMMERCIAL SPACE & URBAN LIVING 605 WEST PEACH STREET \\ BOZEMAN MONTANA LOWER LEVEL The lower level includes two commercial units with a shared common break room and restrooms. Each unit includes large windows, private patios, high-speed internet fiber and one entrance. Unit L1 • 1,721 Gross Sq Ft • 130 Sq Ft Private Patio • Shared Break room & Restrooms • High-Speed Internet Fiber Unit L2 • 1,669 Gross Sq Ft • 78 Sq Ft Private Patio • Shared Break room & Restrooms • High-Speed Internet Fiber Bozeman Midtown TIF Assistance Request MONARCH \\ MIXED-USE PROJECT - PAGE 11- Fee Simple, Free and Clear 78 MONARCH \\ COMMERCIAL SPACE & URBAN LIVING 615 WEST PEACH STREET \\ BOZEMAN MONTANA Bozeman Midtown TIF Assistance Request The 0.443 acre B-2M zoned property sits on the north side of Peach Street, immediately behind the Verizon store on North 7th. The site currently has remnants of an existing parking lot and building which will be demolished with this development. The Monarch is a mixed-use commercial/residential building located in the heart of Bozeman’s Midtown District. This building will provide four commercial units with a shared common break room and restrooms on the basement floor and two commercial units with a shared common break room and restrooms on the main floor for office use. Three residential units will resided on the upper floor. The 21,884± gross sf building will face Peach Street and be accessed by a shared use drive with the commercial building to the east. The proposed parking will be behind the building to the north. Pedestrian access will be provided from Peach Street. The modern design will provide much needed added value to the area. The design reflects large open windows for the office tenants which creates a transparent connection with the outside area as well as the inside spaces. As well, spacious porch areas above the street will provide openness and the ability to sit outside and be above the vehicular traffic a bit while still engaging with the neighborhood. Essentially the design allows for each tenant, whether office or dwelling, to use all decks and patios. We utilize those connections to enhance the building facade. Cantilevered structural components create shading and visual interest. The materials are chosen to be the most durable to ensure long lasting life span. We want the building to be seen as a valuable addition for years to come. We will utilize shaped, pre-finished Metal Siding, cedar lap/screen in soffit and recessed entrances, concrete and composite siding to be painted. As well, concrete ramps, porches, stairs will finish the foundation portion of the project. It is anticipated the solid waste will be disposed of in the existing trash enclosure with a shared use agreement and water and sewer services will be extended from Peach Street. The project will be built at one time. No phasing is proposed. The project is projected to be completed by Spring of 2019. PROJECT NARRATIVE 79 Bozeman Midtown TIF Assistance Request MONARCH \\ MIXED-USE PROJECT - PAGE 13MONARCH \\ COMMERCIAL SPACE & URBAN LIVING 615 WEST PEACH STREET \\ BOZEMAN MONTANA PHOTOS 80 Bozeman Midtown TIF Assistance Request 81 Bozeman Midtown TIF Assistance Request MONARCH \\ MIXED-USE PROJECT - PAGE 15A3.4EXTERIOR 3DIMAGES10-11-1717.115ev2 Job #:CONCEPT REVIEW11-21-173-30-181535 liberty lanesuite 110bmissoula, montana59808phone: 406.540.4437SCALE :13D View - Southwest CornerN.T.S.SCALE :23D View - Northwest CornerN.T.S.SCALE :33D View - Northeast CornerN.T.S.SCALE :43D View - Southeast CornerN.T.S.LANDSCAPING SHOWN IS REPRESENTATIONAL.SEE CIVIL FOR LANDSCAPING PLAN.LANDSCAPING SHOWN IS REPRESENTATIONAL.SEE CIVIL FOR LANDSCAPING PLAN.LANDSCAPING SHOWN IS REPRESENTATIONAL.SEE CIVIL FOR LANDSCAPING PLAN.LANDSCAPING SHOWN IS REPRESENTATIONAL.SEE CIVIL FOR LANDSCAPING PLAN.82 Bozeman Midtown TIF Assistance Request MONARCH WEST PEACH N. 7TH AVE MONARCH \\ COMMERCIAL SPACE & URBAN LIVING 615 WEST PEACH STREET \\ BOZEMAN MONTANA MAPS 83 Bozeman Midtown TIF Assistance Request MONARCH \\ MIXED-USE PROJECT - PAGE 17GARBAGEENCLOSURE LOT 1-A-2 LANDING LANDING LANDINGDN ACCESSIBLE ROUTERAMP OFFICE 1RM#1248 NET SQ FT WINDOW WELLBELOW OFFICE 2RM#1248 NET SQ FT FDCDN DN DN DN DN DN DN WINDOW WELLBELOW WINDOW WELLBELOWWINDOW WELLBELOW UP EXISTING SIDEWALK18'-0"9'-0"24'-0"18'-0"24'-0"30'-5 3/4" +/- 21 SPACES SHOWN (SHARED & REDUCTION BEING INVESTIGATED) MONARCH \\ COMMERCIAL SPACE & URBAN LIVING 615 WEST PEACH STREET \\ BOZEMAN MONTANA PARKING 84 MONARCH \\ COMMERCIAL SPACE & URBAN LIVING 615 WEST PEACH STREET \\ BOZEMAN MONTANA Bozeman Midtown TIF Assistance Request PROJECT TIMELINE • PUBLIC BENEFITS • PROJECT FINANCIAL INFORMATION PART 2 85 Page 12 of 13 Midtown Urban Renewal District TIF Assistance Revised January 2017 PART 2 FOR PROJECTS REQUESTING OVER $50,000 IN ASSISTANCE 1. Detailed Project Information Submit the following information regarding the project requesting TIF assistance.  Project Timeline A project timeline is required. Include anticipated dates for site acquisition, project start and completion, as well as other project milestones. Multi-phase projects must include details for each phase. The timeline should also identify any critical or time-sensitive dates as well as any time constraints facing the applicant.  Public Benefits Fully describe the public benefits that can be realized by the completion of this project. Projects with a high degree of public benefits are typically more likely to receive TIF assistance. Examples of public benefits include, but are not limited to the following:  Re-occupancy of a vacant building  Elimination of blight  Creation of new retail choices  Increased tax revenue  Job-training opportunities This statement should include qualitative examples of public benefits as well as quantifiable and measurable outcomes of the short-term and long-term benefits to the District. Include documentation in support of estimates of public benefits. 2. Project Financial Information In order for the Midtown Urban Renewal District Board to adequately review applications seeking TIF assistance, the following information must be submitted with the application.  Sources & Uses of Funds Identify the sources of funds used to finance the project. Typical sources include equity, lender financing, mezzanine financing, other anticipated types of public assistance, and any other types or methods of financing. Describe the sources of equity and include a term sheet for lender financing, if available. TIF assistance is available as a reimbursement after the project is complete. Thus, the project budget must identify the up-front sources intended to finance the development costs of the project. If determined, specify the specific line items of the project budget that each source will finance. 86 Page 13 of 13 Midtown Urban Renewal District TIF Assistance Revised January 2017 Summarize the uses of funds. General categories to be identified include: acquisition and related site costs, hard construction costs, and a breakdown of soft costs.  Development Budget Provide an accurate and detailed development budget for the project that includes a detailed breakdown of significant line item costs consistent with the sample included in the application packet. The budget should be arranged to identify acquisition and site related costs, hard costs, and soft costs. Also, identify all line items that are performed by the developer, owner, or related entities.  Budget of TIF Eligible Expenses Identify which of the development budget costs are eligible for reimbursement as allowed by 7-15-4288, MCA.  Financial Commitments Submit commitment letters and/or term sheets from all lenders for proposed debt (such as construction, mezzanine, permanent, and government financing) and all other financial sources of the project (such as grants, and tax credits). Commitment letters must clearly specify the nature and terms of the obligations. 87 MONARCH \\ COMMERCIAL SPACE & URBAN LIVING 615 WEST PEACH STREET \\ BOZEMAN MONTANA Bozeman Midtown TIF Assistance Request MONARCH \\ MIXED-USE PROJECT - PAGE 21TIMELINE DEC / JAN / FEB MAR / APR / MAY JUN / JULY / AUG SEP / OCT / NOV DEC / JAN / FEB MAR / APR / MAY CONSTRUCTION Evaluation and concept for the Monarch project began in July of 2017. Planning and review is to be completed in the spring of 2019. Demo will begin in the summer, starting Aug 1st. Following demo and the relocation of utilities, construction will begin September 1st. The Monarch project will be built at one time. No phasing is proposed. Completion of the project is projected for the spring of 2019. PLANNING & REVIEW EXCAVATION / FOUNDATION CONCEPT & DESIGN DEMO / UTILITY RELOCATION COMPLETE FINISHING WORK 88 04 PUBLIC BENEFITS 01 02 03 Bozeman Midtown TIF Assistance Request Re-occupancy of Vacant Land Lot 1-A-2 was the past home of local bank. Since it’s demolition this lot has sat vacant for a couple of years. The Monarch will be a redevelop- ment project that will make the area more vibrant and desirable which will draw activity to the Bozeman Midtown District. Elimination of Blight Currently Lot 1-A-2 consists of vacant land and an empty parking lot. The Monarch’s modern design will provide much needed added value to the area. The design reflects large open windows for the office tenants which creates a transparent connection with the outside area as well as the inside spaces. As well, spacious porch areas above the street will provide openness and the ability to sit outside and be above the vehicular traffic a bit while still engaging with the neighborhood. Essentially the design allows for each tenant, whether office or dwelling, to use all decks and patios. We utilize those connections to enhance the building facade. Cantilevered structural components create shading and visual interest. Creation of New Office/Retail Spaces The Monarch, a mixed-use building, has four office/retail spaces available. The spaces will range from approximately 1,385 to 2,130 gross square feet. Each unit has large windows, spacious porch areas and share a common parking lot with ample free parking. New businesses in the area will draw activity and provide new jobs. Urban Living Options There are three dwellings available on the upper level of the Monarch. Each unit ranges from 420 to 1,088 square feet. Large windows provide beautiful views of the mountains, cityscape and big sky. Walkability options are endless with nearby schools, restaurants, services and downtown only blocks away. MONARCH \\ COMMERCIAL SPACE & URBAN LIVING 615 WEST PEACH STREET \\ BOZEMAN MONTANA 89 05 PUBLIC BENEFITS Bozeman Midtown TIF Assistance Request MONARCH \\ MIXED-USE PROJECT - PAGE 2306 Increased Tax Revenue With the construction of the Monarch this will create new commercial and residential spaces which in turn will creates new jobs, additional sales and property taxes. All of these items will enhance the infrastructure and services in the Bozeman Midtown District. See estimated property taxes include in the budget. New Jobs and Local Sales With the construction of the Monarch building Ironwood Development will be hiring 30+ local subcontractors and suppliers. Supporting local businesses builds strong communities by linking everyone involved in a web of economic and social relationships that contribute the cities economic success, enriching the whole community. MONARCH \\ COMMERCIAL SPACE & URBAN LIVING 615 WEST PEACH STREET \\ BOZEMAN MONTANA 90 MONARCH \\ COMMERCIAL SPACE & URBAN LIVING 605 WEST PEACH STREET \\ BOZEMAN MONTANA Bozeman Midtown TIF Assistance Request SOURCES & USES OF FUNDS The Monarch Sources and Uses of Funds statement below shows a cash and land investment from Peach Street Property, LLC. Construction will be financed locally at either Opportunity Bank of Bozeman or First Security Bank of Bozeman. Peach Street Property, LLC is partnered by local business owners Ironwood, Inc and John Colter, Ltd. USES OF FUNDS LAND (Fair Market Value) $ 386,080.00 SOFT COSTS $ 150,000.00 - Engineering, Architecture, Planning, Permitting, Carrying Costs, Marketing, etc. HARD COSTS $ 2,177,767.26 - Direct Construction Costs TOTAL USES OF FUNDS $ 2,713,847.26 SOURCES OF FUNDS LAND | Peach Street Property, LLC $ 386,080.00 - Fee Simple, Free and Clear CASH | Peach Street Property, LLC $ 150,000.00 CONSTRUCTION LOAN $ 2,177,767.26 TOTAL SOURCES OF FUNDS $ 2,713,847.26 91 MONARCH \\ COMMERCIAL SPACE & URBAN LIVING 615 WEST PEACH STREET \\ BOZEMAN MONTANA Bozeman Midtown TIF Assistance Request MONARCH \\ MIXED-USE PROJECT - PAGE 25 DEVELOPMENT BUDGET 92 MONARCH \\ COMMERCIAL SPACE & URBAN LIVING 605 WEST PEACH STREET \\ BOZEMAN MONTANA Bozeman Midtown TIF Assistance Request TIF ELIGIBLE EXPENSES CITY OF BOZEMAN | Commercial Impact Fees $25,458.68 CITY OF BOZEMAN | Residential Impact Fees $14,392.90 CITY OF BOZEMAN | Cash In Lieu of Park Land $ 5,096.52 CITY OF BOZEMAN | Cash In Lieu of Water Rights $3,240.00 CITY OF BOZEMAN | Fiber/Conduit Installation $ TBD BOZEMAN EXCAVATION SEPTIC & TRUCKING | Demo $38,920.00 NORTH WESTERN ENERGY | Relocation of Services $18,377.00 NORTH WESTERN ENERGY | Primary, New Transformer, Gas and Electric Services $ 5,861.00 CS STRUCTURES | Fire Suppression - 4” Water Line $ 4,000.00 IRONWOOD DEVELOPMENT | Sidewalks $ 9,000.00 SPALDING EXCAVATION | Water & Sewer Hook-ups, Street Cut, Traffic Controls $ 25,000.00 ESTIMATED TOTAL $149,346.10 93