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Home My WebLink AboutTIF2 2007-10-02 AgendasREINVESTMENT ZONE NUMBER 2, CITY OF NORTH RICHLAND HILLS BOARD OF DIRECTORS MEETING TUESDAY, OCTOBER 2, 2007 CITY HALL PRE-COUNCIL ROOM 4:30 P.M. AGENDA 1. Call to Order 2. Approval of June 21, 2005 Board Minutes 3. Appointment of Vice-Chairman and Secretary 4. Consider Financial Status of TIF No. 2 5. Chris Amarante, Construction Manager, City of North Richland Hills, will give a report regarding the progress of the TIF No. 2 library project. 6. Vickie Loftice, Director of Parks and Recreation, City of North Richland Hills, will give a report on the design of the TIF No. 2 recreation center project. 7. Adjournment Phyllis O'Neal Finance Assistant Posting time: / / • ~'~ ~' - ~''' Posting date: 9- ,~ ~-~?0~7 REINVESTMENT ZONE NUMBER 2, CITY OF NORTH RICHLAND HILLS BOARD OF DIRECTORS MEETING TUESDAY, OCTOBER 2, 2007 CITY HALL PRE-COUNCIL ROOM 4:30 P.M. AGENDA 1. Call to Order 2. Approval of June 21, 2005 Board Minutes 3. Appointment of Vice-Chairman and Secretary (TIF #2 2007-01) 4. Consider Financial Status of TIF No. 2 (TIF #2 2007-02) 5. Chris Amarante, Construction Manager, City of North Richland Hills, will give a report regarding the progress of the TIF No. 2 library project. (TIF #2 2007-03) 6. Vickie Loftice, Director of Parks and Recreation, City of North Richland Hills, will give a report on the design of the TIF No. 2 recreation center project. (TIF #2 2007-04) 7. Adjournment MINUTES OF THE TIF BOARD MEETING FOR REINVESTMENT ZONE #2 OF THE CITY OF NORTH RICHLAND HILLS, TEXAS BOARD OF DIRECTORS MEETING - PRE-COUNCIL ROOM AT CITY HALL TUESDAY, JUNE 21, 2005 - 4:15 P.M. Present: Oscar Trevino, Chairman Suzy Compton JoAnnJohnson David Whitson John Lewis Tim Welch Dr. Larry Darlage Glen Whitley Drenda Witt Mayor Council Member Council Member Council Member Council Member Council Member Tarrant County College Tarrant County Commissioners Court Tarrant County Hospital District Others Present: Larry J. Cunningham Richard Torres Bo Bass Karen Bostic Alicia Richardson Larry Koonce Nancy Bielik Lisa McMillan Steve Brown Drew Corn Jane Sanford City Manager Assistant City Manager Assistant City Manager Managing Director of Administrative/Fiscal Services Assistant City Secretary Director of Finance Council Member Tarrant County Commissioners Court Library Director Budget Director Administrator, Northeast SubCourthouse, Precinct #3 1. CALL TO ORDER Mayor Trevino called the meeting to order at 4:15 p.m. 2. APPROVAL OF APRIL 8, 2003 BOARD MINUTES Commissioner Whitley moved to approve the minutes. Dr. Darlage seconded the motion. Motion to approve carried 7-0. CONTINUATION OF MINUTES 3. DISCUSS 2004 ANNUAL REPORT APPROVED Councilwoman Compton present at 4:21 p.m. Director of Finance Larry Koonce provided an overview of the 2004 Annual Report. Mr. Koonce advised the TIF had five years of average growth around 20 million dollars per year and is approximately $96 million in terms of incremental value. Mr. Koonce advised the board the library, which is the first project for the TIF is underway. Mr. Koonce advised tax dollars from the TIF were available to completely finance the library should the board decide. In 2003 the City of North Richland Hills issued Certificates of Obligation in the amount of $1,450,000 for land acquisition and design of the library. Councilman Lewis asked if there was enough money to finance the library or qualify for the debt. Mr. Koonce confirmed the TIF was able to qualify for the debt payments for a total of $10.2 million dollars. Mayor Trevino advised the board instead of getting an approval on the Annual Report, the board would hear presentations by Dan Quinto and Richard Torres and include the presentations as part of the Annual Report. Action on Annual Report taken later in the meeting. 4. REPORT FROM HOME TOWN EXECUTIVE MANAGER DAN QUINTO REGARDING THE CURRENT AND FUTURE DEVELOPMENT APPROVED Mr. Dan Quinto advised the board there were a total of 547 residential lots that have been final platted and approved by the City and of those lots 340 have been sold to builders and 236 are now occupied. Mr. Quinto advised Arcadia is currently working on Phase 4 lots and anticipates approximately 200 lots. The homes on the west side of the development are predominately single-family detached with a small contingent of townhomes. He expects a higher density on the east side as they get closer to the downtown area. Mr. Quinto advised the total residential value through Phase 4 using the average home price of $245,000 (single-family) and $150,000 (townhome) is about 164 million dollars. Mr. Quinto advised the commercial development is approximately 230,000 square feet, Franklin Park is the independent living facility along Mid Cities Boulevard (180,000 square feet), and small retail development along Davis Boulevard. Mr. Quinto advised the board 25 acres were devoted to the lakes and parks, 124 acres are for the first three phases of development that includes the infrastructure and rights- CONTINUATION OF MINUTES of-way, with Phase 4 at 37 acres. Mr. Quinto provided a rendering of the planned mixed-use development. 5. REPORT FROM ASSISTANT CITY MANAGER RICHARD TORRES ON STATUS OF TIF NO. 2 LIBRARY PROJECT Mr. Richard Torres presented a power point presentation outlining the status of the TIF No. 2 library project. June 2005 - BRW Architects hired to design project Spring 2006 -Bid for construction Summer 2006 -Construction to begin o Architect has advised construction for library would take 12-14 months. Fall 2007 -Library completed and ready for move in Councilwoman Johnson left the meeting at 4:34 p.m. Mr. Torres advised the present library occupies about 31,000 square feet and the city anticipates construction of a minimum of 45,000 square feet and perhaps as large as 60,000 square feet. In 2003, Certificates of Obligation in the amount of $1.45 million were issued to begin the process of acquiring land and design of the library. Staff expects to issue the remaining Certificates of Obligation in the amount of $8.7 million in the spring of 2006 for a total cost of $10.2 million for the library project. Mr. Torres advised the board staff is working on the site acquisition. The original development agreement with Arcadia called for the City to only acquire the footprint of the building which is approximately 53,000 square foot. The remaining land for parking would be dedicated to the City as an easement. Mr. Torres advised of a new agreement with Arcadia to purchase the entire piece of property, which would net out to approximately 3.5 acres. Mr. Torres advised staff anticipates Council to approve purchase of the remaining land July 11, 2005. The City will plat and dedicate right-of-way for the realignment of Simmons. Staff anticipates the construction of Simmons to be in the Spring or Summer of 2006. The construction of Simmons will be complete about the same time as the construction beings for the library. Mr. Torres advised there is a possibility that the library would be able to connect to Tarrant County College's future Conference Center via a breezeway across Highway 26 at some point in the future. Councilwoman Johnson returned to the meeting at 4:41 p.m. Councilman Lewis moved to accept the 2004 Annual Report to include both reports presented to the board. Mayor Pro Tem Welch seconded the motion. CONTINUATION OF MINUTES Motion to approve carried 8-0. Mayor Trevino thanked on behalf of the City of North Richland Hills the Hospital District, Tarrant County College and Tarrant County for participating in both TIF's and BISD for participating in -fIF No. 1. 6. ADJOURNMENT Mayor Trevino adjourned the meeting at 4:44 p.m. i ~r -vo, z Subject: Appointment of Vice-Chair and Secretary Board Meeting Date: 10/02/2007 Agenda Number: 2007-01 Due to recent changes with the board members of the North Richland Hills City Council, Tarrant County, Tarrant County Hospital District, and Tarrant County College. it is necessary to elect officers to serve as Vice-Chair and Secretary. At the September 24, 2007 North Richland Hills City Council meeting, Mayor Oscar Trevino was reappointed to serve as Chairman. Recommendation: To appoint the Vice-Chair and Secretary. ~ it n-o. subject: Consider the Financial Status of TIF No. 2 Board Meeting Date 10/02/2007 Agenda Number: 2007-02 Larry Koonce, Director of Finance City of North Richland Hills will present the attached executive summary, annual report and comparison of the original financing plan with the actual results to date. The figures for fiscal year ending September 30, 2007 are preliminary estimates and will be updated when finalized. The annual report will be submitted to the State Comptroller before December 31, 2007 and distributed to the Board and taxing entities. The report shows that actual property tax collections as compared to the original plan are lagging. Reasons that tax revenues have come slower are enumerated in the executive summary. Actual property tax revenues in fiscal year 2007 were $1,722,826 compared to the original plan estimate of $3,040,145. Taxes collected since inception total $6,250,631 compared to $11,259,822 estimated in the original plan. Cash balances including tax collections, interest earnings and certificate of obligation proceeds as of September 30, 2007 are approximately $5.3 million. After the presentation of financial status of TIF No. 2, we recommend the Board take action as to the acceptance of the report. INFORMAL REPORT TO BOARD OF DIRECTORS No. IR 2007-01 r Date: September 28, 2007 ,. :.~ ~. - Subject: Tax Increment Reinvestment Zone No. 2 Executive Summary for TIF Board Meeting, October 2, 2007 Attached for your information is "Tax Increment Reinvestment Zone No. 2, Preliminary Financial Estimates, For the Year Ended September 30, 2007". TIF No. 2 was created by the City of North Richland Hills in 1999. The District was created to provide public improvements that would benefit the City of North Richland Hills, Tarrant County College, Tarrant County and Tarrant County Hospital District. Planned public improvements include a conference center, a recreation center, a library and infrastructure improvements in the Home Town NRH development. Total public improvements are estimated at $65.2 million including developer infrastructure. The District was created for twenty-eight years to provide for the retirement of planned debt issuance for financing of the improvements. The City of NRH and Tarrant County College agreed to contribute 100% for the full twenty-eight years. The County and Hospital District agreed to participate up to a fixed dollar amount that was anticipated to accumulate over approximately afifteen-year period based on estimated property values. At the time the District was created the main developer, E-Systems, estimated that Home Town NRH would be comprised of approximately 70% residential and 30% commercial and retail development. The District's boundaries also include other developments such as the Crossing (Kohl's) Center, Home Depot, Blue Line Ice and the Barnett property. The plan (based on a study done by Zimmerman/ Volk) estimated that property values would increase by over $370 million in ten years. Over the life of the District, the values were estimated to generate approximately $82.2 million in total tax revenues to fund the planned public improvements. The captured appraised value in 2006 (fiscal year 2007) was $138,802,663 for the City of NRH and $149,107,903 for Tarrant County. The differences are the exemptions granted by the taxing jurisdictions. The District received $1,722,826 from all taxing jurisdictions in fiscal year 2007. In April 2003, the City of North Richland Hills issued Certificates of Obligation in the amount of $1,450,000 for land acquisition, building program planning and architectural design services for the Library Project. This is the first public improvement project scheduled in the TIF No. 2 Project Plan. In April 2006, the City of North Richland Hills issued Certificates of Obligation in the amount of $8,750,000 for construction of the library. The contract for the construction of the library was awarded and a ground breaking ceremony was held in October, 2006. The estimated completion and opening of the nearly 60,000 square foot library is spring 2008. A progress report on the library construction will be presented at the October 2 meeting. The City of North Richland Hills has also budgeted for the design of the recreation center project in fiscal year 2008. A presentation on the preliminary plans will also be made at the board meeting. Also attached to this executive summary is a "Comparison of Original Plan to Actual Development". The report shows that actual property tax collections as compared to the original plan are lagging. Actual property tax revenues in fiscal year 2007 were $1,722,826 compared to the original plan estimate of $3,040,145. Taxes collected since inception total $6,250,631 compared to $11,259,822 estimated in the original plan. Cash balances including tax collections, interest earnings and certificate of obligation proceeds as of September 30, 2007 are approximately $5.3 million. ISSUED BY THE CITY MANAGER NORTH RICHLAND HILLS, TEXAS Reasons that property tax collections have come slower and in some cases are lower than originally estimated, include, but are not limited to the following: Fallout from 9/11/2001 -economic uncertainty affecting in the early stages of development. 2. Less business development compared to the original TIF plan: more residential development than commercial or office development in the entire TIF district. Due to market conditions Arcadia has substituted residential development in areas originally planned for commercial development. 4. More tax exempt development than anticipated in the original TIF plan. This includes, for example, school and church development. These amenities have added to the quality of life within the district, but have reduced values from the tax rolls. 5. Protests by owners/developers over the years to the Tarrant Appraisal District to reduce property values, thereby reducing revenues. Respectfully submitted, ~_~ . Larry Koonce Director of Finance Attachments: TIRZ No. 2 Preliminary Annual Report FY 2007 Comparison of Original TIF No. 2 Plan to Actual Development City of North Richland Hills Tax Increment Reinvestment Zone No. 2 Report to the Board Estimated Year Ended September 30, 2007 (unaudited) Amount & Source of Revenue in the Tax Increment Fund FY 2007: Property Tax Revenues $ 1,722,826 Interest Income $ 623,662 Total Revenues in Fiscal Year 2007 $ 2,346,488 Amount and Purpose of Expenditures of the Fund FY 2007: Principal, Interest, Issuance & Paying Agent Payments on Certificate Indebtedness $ 1,052,872 Library Project Expenditures Construction Fund $ 4,165,823 Total Fund Expenditures in Fiscal Year 2007 $ 5,218,695 Principal & Interest due on outstanding indebtedness as of September 30, 2007: Principal Outstanding $ 9,585,000 Interest Outstanding $ 4,131,812 Total Principal & Interest Outstanding 9-30-2007 $ 13,716,812 Captured Appraised Value shared by the Mun icipality & Other T axing Entities and total amount of tax increments received Captured Tax Property Tax 1999 Base Year Taxable Value Appraised Rate!$100 Revenue FY Taxing Unit Appraised Value 2006 Value 2006 FY 2007 2007 City of North Richland Hills $40,577,462 $179,380,125 $138,802,663 $0.570000 $791,175 Tarrant County $40,577,462 $189,685,365 $149,107,903 $0.271500 $404,828 Tarrant County Hospital District $40,577,462 $189,685,365 $149,107,903 $0.235397 $350,996 Tarrant County College $40,577,462 $189,720,365 $149,142,903 $0.139380 $207,875 $1,754,874 Total billings ou tstanding $ (32,048) Taxes Collecte d FY 2006 $1,722,826 This report submitted by - - ~ f _ . ~ , rt Larry KooncA Director of Finance City of North Richland Hills, Texas K acct/tifs/TIF2 Annual Report to Board Oct 2007 Est September.xlsAnnual Report City of North Richland Hills Tax Increment Reinvestment Zone No. 2 Comparison of Original Plan to Actual Development FY 2007 Original Financing Plan (First Eight Years) June 29, 2000 Fiscal Property Tax Year Captured Valuation Revenues 2000 $ - $ - 2001 $ 12,620,987 $ 148,336 2002 $ 62,888,445 $ 739,138 2003 $ 93,808,805 $ 1,102,550 2004 $ 133,670,655 $ 1,571,053 2005 $ 179,985,905 $ 2,115,403 2006 $ 216,384,090 $ 2,543,197 2007 $ 258,666,185 $ 3,040,145 Total Planned Property Tax Revenues $ 11,259,822 Actual Development (Eight Years) Fiscal Property Tax Year Captured Valuation Revenues 2000 $ - $ - 2001 $3,523,615 $ 44,830 2002 $ 31,512,080 $ 288,774 2003 $ 58,118,922 $ 637,156 2004 $ 83,275,381 $ 1,013,513 2005 $ 93,385,726 $ 1,143,840 2006 $ 120,350,714 $ 1,399,692 2007 $ 149,142,903 $ 1,722,826 Total Property Tax Revenues $ 6,250,631 K:acct/tifs/TIF2 Annual Report to Board Oct 2007 Est September.xlsOrig Plan vs actual TIF No. 2 Subject: Library Project Update Board Meeting Date 10/02/2007 Agenda Number: 2007-03 The TIF No. 2 library project is under construction and the anticipated opening is Spring 2008. This is the first project in the TIF No. 2 Project and Financing Plan. A project sheet from the City of North Richland Hills fiscal year 2007-2008 Capital Improvements Plan is enclosed. The sheet includes a project description, justification and budget. Chris Amarante, Construction Manager, City of North Richland Hills will present a Powerpoint presentation regarding the progress and estimated completion of the project. This item is for information purposes only. No action from the board is required. Municipal Facility Capital Projects Department Library Project Title Central Area NRH Library (TIF #2) Project Number LB0301 Project Description Project includes construction of a new library, with a capacity to house a collection of 190,000 print volumes integrated with state-of-the-art technology for users to access the world of information. Funding for the project is from the Spring 2006 sale of COs, backed by revenues from Tax Increment Reinvestment Zone #2 (TIRZ-2). Construction began in Fall 2006 and is expected to be complete in the first quarter of 2008. The 58,858 square foot facility is located at 9015 Grand Avenue in Home TownNRH. The facility includes a 2-story 9,858 square foot shell space that when finished out will expand the Library's capacity to approximately 225,000 volumes. Project Justification This project is designed to meet the service needs of NRH, as identified in the 1999 Library Needs Assessment and Study by Providence Associates, which projected a need for a library of49,000 square feet based on the then-current demographic projections for NRH. Please Note: TIF #2 was established pursuant to Ordinance No. 2420, which was adopted on the 25th of October 1999. NRH issued Certificates of Obligation in Spring 2006, supported by TIF #2 collections, to fund the construction of this project. Total Project Costs "Other" includes $650,000 for furniture and $200,000 for IT equipment. Impact on Operating Budget Impact on operating costs for additional staff, library materials, other operating expenses, utilities and maintenance, materials purchases, and extended operating hours. It is important to note that the figures shown below are subject to change. I Estimated Annual 2007-08 2008.09 2009.10 2010.11 2011-12 5-Year Total Operating Impact $ 168,711 $ 337,422 $ 350,918 $ 364,955 $ 379,553 $ 1,601,559 Project Schedule Beginning Date Ending Date Budget History Professional Services 0712003 08/2003 Original Budget $10,200,000 Engineering/Design 0612005 06/2006 Land1ROW Acquisition 1012002 05/2005 Construction 0912006 01/2008 Other 09/2007 0212008 Total Project 10!2002 02f2008 Total Project Cost $ 10,200,000 Sources of Funds To Date 2007-08 Proposed 2008.09 Estimated 2010 to Completion Total of Amount General Obligation Bonds $ 0 Certificates of Obligation 10,200,000 0 10,200,000 Federal/State Grants 0 Reserves 0 Sales Tax 0 Other 0 Total Funding $ 10,200,000 $ 0 $ 0 $ 0 $ 10,200,000 Total Project Costs Professional Services $ 0 EngineeringlDesign 820, 000 100, 000 920, 000 Land/ROW Acquisition 530,000 530,000 Construction 6,000, 000 1,900, 000 7,900, 000 Other 850, 000 850, 000 Total Costs $ 7,350,000 $ 2,850,000 $ 0 $ 0 $ 10,200,000 184 TIF No. 2 subject: Recreation Center Project Update Board Meeting Date: 10/02/2007 Agenda Number: 2007-04 The design of the recreation center project is included in the City of North Richland Hills fiscal year 2007-2008 Capital Improvements Plan. This will be the second project in the TIF No. 2 Project and Financing Plan. A project sheet is enclosed which includes the description, justification and budget. It is anticipated that sufficient tax dollars from the TIF will be available to meet the debt payments and funding of the recreation center as planned. Vickie Loftice, Director of Parks and Recreation, City of North Richland Hills will make a Powerpoint presentation regarding the design and possible features of the recreation center. The next step in the process will be to select a professional firm for project design. This item is for information purposes only. No action from the board is required. Municipal Facility Capital Projects Department Parks & Recreation Project Title Central NRH Recreation Center !TIF #2) Project Number PK0404 Project Description This project provides for design and construction of a recreation center up to 100,000 square feet and will include indoor leisure and aquatic features. Other indoor amenities may include a double gymnasium, expansive fitness center, indoor walking track, classrooms, pre-school/day care room, banquet/meeting space, kitchen facilities, showers, lockers and administrative offices. Project Justification The 1991 Park System Master Plan and the 2000 Parks, Recreation and Open Space Master Plan documented the need for an additional Recreation Center. The Public Attraction Facility Market Analysis and Economic Analysis prepared by Leland Consulting Group also identifies this demand for services. Please Note: TIF #2 was established pursuant to Ordinance No. 2420, which was adopted on the 25th of October 1999. Project viability and timing are contingent upon certain conditions being met as outlined in written agreements made by and between NRH, the Developer and participating taxing units. As such, the project schedule is subject to change. As shown below, Parks & Recreation Development Fund sales tax and Certificates of Obligation issued by NRH will fund the project. The debt issuance will be supported by TIF #2 collections. Finally, several options for immediate and long-term facility development will be considered during project design, which may impact the scope and cost ofthe project. Project Schedule Beginning Date Ending Date Budget History Professional Services Original Budget $21,900,000 EngineeringlDesign 10/2007 12!2008 Land/ROW Acquisition Construction 02/2009 10!2010 Other Total Project 1012007 10!2010 Total Project Gast $ 21,900,000 Sources of Funds To Date 2007-08 Proposed 2008-09 Estimated 2010 to Completion Total of Amount General Obligation Bonds $ 0 Certificates of Obligation 2,000,000 18,800,000 20,800,000 FederallState Grants 0 Reserves 0 Sales Tax 500,000 600,000 1,100,000 Other 0 Total Funding $ 0 $ 2,500,000 $ 19,400,000 $ 0 $ 21,900,000 Total Project Costs Professional Services $ 0 Engineering/Design 1,400,000 1,000,000 100,000 2,500,000 LandlROW Acquisition 0 Construction 8,200,000 10,200, 000 18,400, 000 Other 1, 000, 000 1, 000, 000 Total Costs $ 0 $ 1,400,000 $ 9,200,000 $ 11,300,000 $ 21,900,000 Impact on Operating Budget The estimated annual M & O reflects the difference between the existing recreation center and the future recreation center. Anticipated M & O for the current facility in 2010 is estimated at 1.3 million. The first year operating cost of the new facility is estimated at $4,163,714. Revenue is estimated at approx. $3,737,900. Estimated Annual 2007-08 2008-09 2009-10 2010-11 2011-12 5-Year Total Operating Impact ~ $ 0 $ 0 $ 500,000 $ 2,863,714 $ 2,978,263 $ 6,341,977 ~ 192