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Applewood IV - Petition for Urban Revitalization Area Designation_Lange EstateApplewood IV Senior Housing Estimated Property Tax Calculation and Abatement Schedule November 23, 2015 2018 2019 2020 2021 2022 2023 1 2024 2025 2026 2027 Gross potential residential rent LESS: Residential vacancy Net Rental Income Add: Parking income Add: Laundry income Add: Storage income Total Operating Income Less: Operating expenses (excluding taxes) Less: Reserves Net Operating Income $ 505,190 $ 515,294 $ 525,600 $ 536,112 $ 546,834 $ 557,771 $ 568,926 $ 580,305 $ 591,911 $ 603,749 $ (35,363) $ (36,071) $ (36,792) $ (37,528) $ (38,278) $ (39,044) $ (39,825) $ (40,621) $ (41,434) $ (42,262) $ 469,827 $ 479,223 $ 488,808 $ 498,584 $ 508,556 $ 518,727 $ 529,101 $ 539,684 $ 550,477 $ 561,487 $ - $ $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ - $ - $ $ - $ - $ - $ - $ - $ - $ - $ - $ - $ $ 469,827 $ 479,223 $ 488,808 $ 498,584 $ 508,556 $ 518,727 $ 529,101 $ 539,684 $ 550,477 $ 561,487 $ (199,085) $ (204,775) $ (210,631) $ (216,657) $ (222,857) $ (229,238) $ (235,804) $ (242,561) $ (249,514) $ (256,669) $ - (18,315) $ (18,864) $ (19,430) $ (20,013) $ (20,614) $ (21,232) $ (21,869) $ (22,525) $ (23,201) $ (23,897) $ 252,427 $ 255,583 $ 258,746 $ 261,914 $ 265,085 $ 268,257 $ 271,428 $ 274,598 $ 277,763 $ 280,921 Calculation of Annual Property Tax Capitalization Rate Assessed Value - Improved Assessed Value - Existing Assessed Value - Increase Residential rollback to be applied Assessed Value for taxation City of Dubuque 2015 tax rate Annual Property Tax Increase over Existing 9.50% 9.50% 9.50% 9.50% 9.50% 9.50% 9.50% 9.50% 9.50% 9.50% $ 2,657,126 $ 2,690,348 $ 2,723,646 $ 2,756,988 $ 2,790,367 $ 2,823,756 $ 2,857,137 $ 2,890,508 $ 2,923,816 $ 2,957,067 $ 180,320 $ 180,320 $ 180,320 $ 180,320 $ 180,320 $ 180,320 $ 180,320 $ 180,320 $ 180,320 $ 180,320 $ 2,476,806 $ 2,510,028 $ 2,543,326 $ 2,576,668 $ 2,610,047 $ 2,643,436 $ 2,676,817 $ 2,710,188 $ 2,743,496 $ 2,776,747 90% 90% 90% 90% 90% 90% 90% 90% 90% 90% $ 2,229,126 $ 2,259,025 $ 2,288,994 $ 2,319,001 $ 2,349,042 $ 2,379,093 $ 2,409,135 $ 2,439,169 $ 2,469,146 $ 2,499,072 0.03301933 0.03301933 0.03301933 0.03301933 0.03301933 0.03301933 0.03301933 0.03301933 0.03301933 0.03301933 $ 73,604 $ 74,592 $ 75,581 $ 76,572 $ 77,564 $ 78,556 $ 79,548 $ 80,540 $ 81,530 $ 82,518 Property Tax Abatement % 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% Expected Property Tax Abatement $ 73,604 $ 74,592 $ 75,581 $ 76,572 $ 77,564 $ 78,556 $ 79,548 $ 80,540 $ 81,530 $ 82,518 Cumulative Property Tax Abatement $ 73,604 $ 148,196 $ 223,777 $ 300,349 $ 377,912 $ 456,468 $ 536,017 $ 616,556 $ 698,086 $ 780,604 RESOLUTION NO. 400-15 RESOLUTION FINDING THAT THE DESIGNATION OF THE LANGE ESTATE URBAN REVITALIZATION PLAN IS NECESSARY TO ENCOURAGE NEEDED HOUSING AND RESIDENTIAL DEVELOPMENT PROVIDING SAFE, AFFORDABLE HOUSING FOR THE RESIDENTS OF THE CITY OF DUBUQUE, IOWA Whereas, the City Council of the City of Dubuque finds that the property at 3275 Pennsylvania Avenue (Property) is currently vacant and underutilized, and Horizon (Horizon) has proposed to develop the Property by constructing a 60 -unit residential housing development for seniors; and Whereas, the City supports the development and construction of housing and residential properties which provide quality, affordable housing; and Whereas, the Property is located in an area eligible for the Urban Revitalization Tax Exemption program; and Whereas, in the area proposed for designation under the Urban Revitalization Act there is need for public improvements related to housing and the encouragement of housing'and residential development as defined by Section 404.1(5) of the Iowa Code; and Whereas, through the Urban Revitalization Program, the Property is eligible to receive a one hundred percent exemption from taxation on the actual value added by the improvements for a period of ten years so long as it is assessed as residential property or assessed as commercial property, if the commercial property consists of three or more separate living quarters with at least seventy-five percent of the space used for residential purposes. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA: Section 1. The new construction housing development at the Property legally described as Lot Two of Lange Estate in the County of Dubuque, City of Dubuque, Iowa, according to the recorded plat thereof is deemed necessary and in the interest of the residents of the City. Section 2. That the City Council supports the Horizon Petition asking the Property be designated an Urban Revitalization Area and supports Horizon's efforts to receive a tax credit award from the Iowa Finance Authority for this Development. Section 3. The City Council approves supporting the project and authorizes staff to work with the City Assessor to complete the form 5S for the Developer's submission to the Iowa Finance Authority prior to the December 7, 2015 deadline for consideration. Section 4. The proposed Development is consistent with the City of Dubuque's affordable housing strategies and goal to implement the City's comprehensive plan. Passed, approved and adopted this 16th day of Novemb,r, 2015. Attest: Kev'n Firnsta 1, .itai Clerk ' Roy D. BI, Mayor Copyright 2014 City of Dubuque Action Items # 6. ITEM TITLE: Lange Estate Urban Revitalization Area Designation SUMMARY: City Manager recommending approval of a petition for Urban Revitalization Area Designation from Horizon for a 60 unit affordable senior housing development at 3275 Pennsylvania Avenue titled Applewood IV. RESOLUTION Finding that the designation of the Lange Estate Urban Revitalization Plan is necessary to encourage needed housing and residential development providing safe, affordable housing for the residents of the City of Dubuque, Iowa SUGGESTED DISPOSITION: Suggested Disposition: Receive and File; Adopt Resolution(s) ATTACHMENTS: Description Type ❑ Lange Estate Petition for Urban Revitalization Designation-MVM Memo City Manager Memo ❑ Staff Memo Staff Memo ❑ Petition for Urban Revitalization Designation Supporting Documentation ❑ Exhibit 5S Supporting Documentation ❑ Resolution Resolutions THE CITY OF Dubuque U E I erica .i Masterpiece on the Mississippi 2007-2012-2013 TO: The Honorable Mayor and City Council Members FROM: Michael C. Van Milligen, City Manager SUBJECT: Petition for Designation of Lange Estate Urban Revitalization Area District Horizon, Applewood IV DATE: November 12, 2015 Housing & Community Development Department Director Alvin Nash recommends approval of a petition for Urban Revitalization Area Designation from Horizon for a 60 unit affordable senior housing development at 3275 Pennsylvania Avenue titled Applewood IV. Urban Revitalization Chapter 404 of the Iowa Code (Urban Revitalization Act) authorizes cities to designate areas as urban revitalization areas. Improvements to qualified real estate within these designated areas may receive a total or partial exemption from property taxes for a specified number of years. The exemptions are intended to stimulate private investment by reducing tax increases that usually accompany property improvements. This additional private investment provides a long- term increase or stabilization in the area's tax base, enhances the visibility of revitalization areas and/or supports important city objectives such as historic preservation, economic development and affordable housing development. The development plan provides for the construction of a 60-unit planned residential housing development for seniors, Applewood IV. The planned development is located at 3275 Pennsylvania Avenue and is the fourth installment in a series of senior housing developments Horizon has provided in the area. Horizon development is proposing a $9.2 million dollar project utilizing private financing, state HOME Funds, Federal Home Loan Bank Des Moines AHP, Tax Credit Equity, and Tax Abatement incentives to finance the project. The urban revitalization tax exemption will show local support for the project, which will strengthen Horizon's Tax Credit application to the Iowa Finance Authority. The proposed Urban Revitalization plan for Lange Estates will provide for an exemption under 404.3(4) and permit a one hundred percent exemption from taxation on the actual value added by improvements for qualified real estate assessed as residential property or assessed as commercial property, for a period of ten years. Horizon has agreed to this exemption schedule. This assistance is very important to the success of the project. The application for state tax credits is competitive. A developer receives points for city financial assistance, with maximum points provided for assistance equaling 7% of project costs. I concur with the recommendation and respectfully request Mayor and City Council approval. A4�. Mic ael C. Van Milligen MCVM:jh Attachment cc: Barry Lindahl, City Attorney Cindy Steinhauser, Assistant City Manager Teri Goodmann, Assistant City Manager Alvin Nash, Housing & Community Development Department Director 2 THE CITY OF Dubuque AII-Ame1 rica City DUBgkE r Masterpiece on the Mississippi 2007.2012.2013 TO: Michael Van Milligen, City Manager FROM: Alvin Nash, Housing & Community Development Director DATE: November 12, 2015 RE: Petition for Designation of Lange Estate Urban Revitalization Area District Horizon, Applewood IV Introduction This memorandum presents for City Council a petition for Urban Revitalization Area Designation from Horizon. The memorandum recommends the City Council review and approve the attached resolution to establish Lange Estate as a property that meets the requirements for designation as required by Chapter 404 of the Iowa Code. Background Urban Revitalization Chapter 404 of the Iowa Code (Urban Revitalization Act) authorizes cities to designate areas as urban revitalization areas. Improvements to qualified real estate within these designated areas may receive a total or partial exemption from property taxes for a specified number of years. The exemptions are intended to stimulate private investment by reducing tax increases that usually accompany property improvements. This additional private investment provides a long-term increase or stabilization in the area's tax base, enhances the visibility of revitalization areas and/or supports important city objectives such as historic preservation, economic development and affordable housing development. In order to implement the provisions of Chapter 404, the City determine the area is eligible for exemption, prepare a revitalization plan for each designated area, and hold at least one public hearing after proper notice. The law mandates specific criteria and procedures must be followed. Discussion The development plan provides for the construction of a 60-unit planned residential housing development for seniors, Applewood IV. The planned development is located at 3275 Pennsylvania Avenue and is the fourth installment in a series of senior housing developments Horizon has provided in the area. Horizon development is proposing a $9.2 million dollar project utilizing private financing, state HOME Funds, Federal Home Loan Bank Des Moines AHP, Tax Credit Equity, and Tax Abatement incentives to finance the project. The urban revitalization tax exemption will show local support for the project, which will strengthen Horizon's Tax Credit application to the Iowa Finance Authority. The proposed Urban Revitalization plan for Lange Estates will provide for an exemption under 404.3(4) and permit a one hundred percent exemption from taxation on the actual value added by improvements for qualified real estate assessed as residential property or assessed as commercial property, for a period of ten years. Horizon has agreed to this exemption schedule. This assistance is very important to the success of the project. The application for state tax credits is competitive. A developer receives points for city financial assistance, with maximum points provided for assistance equaling 7% of project costs. Budgetary Impact The property value, based upon 2015 Beacon data, is $96,740 for land and $83,490 for dwelling for a total taxable value of$180,230. Dubuque City Assessor Rick Engelken estimates after improvements the assessed value for taxation will be $2,170,883. At the City of Dubuque 2015 tax rate of 0.03301933, the annual property tax increase over existing is estimated to be $71 ,681 . The abatement of$71 ,681 will be in effect for 10 years for a total of$716,810. After the abatement period expires the property will be taxed based on the assessed value for taxation as determined by the assessor. Recommendation I recommend that the City Council approve the attached resolution confirming the need for the Lange Estate Urban Revitalization Plan and directing staff to work with the City Assessor to complete Exhibit 5S. Action Requested The Action Step is for the City Council to adopt the attached resolution and authorize staff to work the City Assessor to complete Exhibit 5S prior to show local support for the development. Prepared by: Erica Haugen, Community Development Specialist F:\USERS\CDBG\Urban Revite\Applewood 4\Memo to Council.doc 2 HORIZON DESIGN • BUILD • MANAGE September 29, 2015 Ms. Erica Haugen Community Development Specialist Housing& Community Development City of Dubuque 350 West 6th Street, Suite 312 Dubuque, IA 52001-4148 RE: URBAN REVITALIZATION AREA- Petition 3275 Pennsylvania Avenue, Dubuque, IA Dear Ms. Haugen, Please accept the following information in support of a petition to include the above referenced property in an Urban Revitalization Area in the City of Dubuque. Attached Supporting Information: 1. Property Map 2. Concept Site Plan 3. Sources and Uses of Funds 4. Cash Flow Statement (2 pages) Eligibility of the Proposed Designation The proposed Urban Revitalization Area ("URA") shall include the property located at 3275 Pennsylvania Avenue, Dubuque, Iowa (the "subject parcel'). The URA meets eligibility criteria established in Section 404.1 of the Iowa Code. The following are direct responses to the five criteria in 404.1. 1. Not applicable 2. There exist incompatible land use relationships at the property location. There is an inconsistent land use pattern of multifamily development from 3125 to 3225 Pennsylvania Avenue (east of subject parcel), single family(subject parcel), and commercial uses along John F. Kennedy. Also,the subject parcel consists of an unoccupied single family home that is in a state of disrepair. It is appropriate to 5201 East Terrace Drive,Suite 300 • Madison,WI 53718 • (608)354-0900 MAIN FAX(608)354-0880 • CONSTRUCTION FAX(608)354-0902 • MANAGEMENT FAX(608)354-0903 I 1660 Embassy West Drive,Suite 250 • Dubuque,IA 52002 • (563)556-1188 • FAX(563)556-4890 3900 South Prairie Hill Lane • Greenfield,WI 53228 • (414)541-3900 • FAX(414)541-3100 Internet Sites •www.horizonbdm.com • Management:www.horizonseniorhousing.com consider the subject parcel as 1) incompatible to its surroundings and 2) characteristics of deteriorating site improvements and therefore eligible as a revitalization area. 3. Not applicable 4. The area is justified as an economic development area as defined in section 403.17 of the Iowa Code. This section of the code indicates that "Economic development area means an area of a municipality designated by the local governing body as appropriate for commercial and industrial enterprises, public improvements related to housing and residential development, or construction of housing and residential development for low and moderate income families, including single or multifamily housing." The proposed URA would support development of 60 units of multifamily housing for low to moderate income families pursuant to the affordable housing tax credit program administered by Iowa Finance Authority. There is a demonstrated need for this housing as the adjacent Applewood I, II, and III properties have been very successful and continue to operate at low vacancy with strong waiting lists. 5. The area is appropriate for construction of housing and residential development. In particular the proposal for the subject parcel includes 60 units of multifamily senior housing. Legal Description The legal description that is listed for the property is "Lot 2 Lange Estate". This 2.76 acre site is located at 3275 Pennsylvania Avenue, Dubuque, Iowa. Property map is attached. Valuation of Property The property value, based on 2015 Beacon data, is $96,740 for land and $83,490 for dwelling. The sum is $180,230. Property Ownership The deed holder for the property is: Dubuque Senior Housing V, LLC 1398 Central Avenue Dubuque, IA 52001 Zoning Classification Property is currently zoned PR (Planned Residential). This was approved by the Dubuque City Council on September 21, 2015. Applicability of Proposed Designation The proposed revitalization is applicable to all of the property assessed as residential. Also,the revitalization will be all new construction. 2 Relocation The existing single family home on site is not occupied. Therefore there are no persons who will be displaced as a result of the improvements and a relocation plan is not necessary. Proposed Improvements Horizon Development Group, Inc. is proposing a 60-unit senior housing community at 3275 Pennsylvania Avenue. The building will be two stories with underground parking and a mix of one and two bedroom unit types. Rents will be structured with a range of affordability according to county median income and the affordable housing tax credit program. Anticipated common area features would include community room with kitchen, leasing office, exercise room, and heated underground parking included in rent. The existing single family home that currently exists on the property would be demolished and all improvements would be new construction. Significant earthwork is expected on site due to site topography. A concept site plan is attached to provide additional information on the proposed development. Anticipated Impact of Improvements The impact of the proposed improvement on the existing assessed valuation of the building and land may be summarized as follows: Assessed Value Note Improvement $2,592,413 1 Existing land & building) $1801230 Increase $2,412,183 A Dlv residential rollback 90% Increase in taxable value $2,170,965 Note 1—Improvement value is based on income approach using affordable rents. Methodology confirmed by City of Dubuque Assessor Rick Engelken. Funding Sources Please see attached sources and uses of funds statement dated September 29, 2015 for this information. Please note that the funding source labeled "Tax Abatement—Private Loan" is the result of the municipal benefit being provided. As described in a letter to City Manager Mike Van Milligen on August 19, 2015, we are proposing a 15 year tax abatement to benefit the property with 10%of increased taxes going to the City of Dubuque. The amount of the private loan is based on 90%of the tax increase being abated for 15 years, which allows the project to capitalize the savings with a loan at project closing. The loan size is based on approximately $65,000 being available to the project for debt service in year 1 and increasing 2% per year thereafter. The loan size is approximate and not based on lender commitment at this time. 3 Economic Justification Please see attached cash flow analyses, one showing the effects of tax abatement and the other without. Highlighted at the bottom of each page is the corresponding debt service coverage ratio. Mutli-family residential loans are typically underwritten such that loans must maintain enough income to support 1.25 times the level of debt service which is not met without the tax abatement. Cash flow is shown for 15 years which matches the term of the requested abatement. A secondary justification for the benefit is related to the project scoring through Iowa Finance Authority's affordable housing tax credit program. Projects are awarded points for financial participation received from municipalities and tax abatement qualifies for this participation. The City of Dubuque's involvement in the capacities described above allows the project to score competitively in the tax credit program. Without this benefit,the project would score much lower relative to other projects, and be at risk of not moving forward. Summary Statement It is appropriate to consider 3275 Pennsylvania as part of the City of Dubuque's Urban Revitalization Program. The current property includes only a vacant single family home and is under-utilized. The highest and best use of the site is to develop multi-family housing similar to adjacent uses. This provides the corridor with appropriate commercial development that extends west to John F. Kennedy. The designated area is very appropriate for the proposed 60 unit affordable housing community and therefore meets the eligibility criteria established by Section 404.1 of the Iowa Code. There is significant positive financial impact of the proposed development and the proposed tax abatement. The new housing community will provide needed affordable housing for Dubuque seniors and will further enhance the existing Applewood community on Pennsylvania Avenue. The existing Applewood I, II, and III properties have performed very well and continue to maintain wait lists for future residents. A neighborhood meeting was held in August 2015 to discuss the proposed development and was met with strong support from current residents and surrounding neighbors. Without the support of the City of Dubuque,the proposed project would not be financially feasible and also would not likely score competitively enough to be developed. Horizon Development Group has a proven track record with the City of Dubuque and has identified an opportunity to meet the needs of additional seniors looking for quality, affordable living in a terrific location. We urge City officials to kindly consider this petition for the property to be included in the Urban Revitalization Program and support the tax abatement request. 4 If there are any questions on the above information or additional explanations are needed, please feel free to call me at 608-354-0820 or email s.kwiecinski@horizondbm.com. Thank you very much for your assistance. Sincerely, HORI N DEVELOPMENT OUP, INC. Scott J. Kwfecinski Development Manager 5 Property Map 10214810006 1022353021 f02285J022 A O m A O - cAa>Ea ao 1022355002 1022354002 1022354003 1022354006 1022354009 10214]9004 1021481003 1022355001 1022354004 1022354005 1021481002 1022354001 1021 A81001 21 5 TTEL-LINK A I '=®LOT 10 C _ 1021' "1005 Q2 1022354010 1022354011 A A 21981000 — r ,, �y T • _ PENNSYLVA 7 � -- m �- °5 fF Jai c 102]10500] ■ ID2]f0300] j 1 -1 A 102]105001 NEl/4 oz ,o3ooz 5 1 1027102009 [r 1-89N-2E 1027103001 � 102]105008�, 1-89 02E2aa, 92 ,93993 ovlo5ooz ILL 1024103008 102]105009 1100 Irl I 1 I I I I I I I II I I I s• srwlTARr --I -------------- L------------- I LOT, METTELIUNK ADD. LOT 2 I BLOCK1 . LOT BLOCK33 BLOCK 3 LOT 6 I LOT 5 I BLOCK 43 � _ — PMIS. BLOCK 3 BLOCK 3 �� ( — �\` _„ `\_ 71"111 knothe bruce = = _ — — — — — 77 0I I1,AIIIIIIII`T 7111711111 A R H I T E T / / C C S „ _ „ , , � - Phone: 7601 Un' ersit Ave Ste 201 — — _ _ Middleton,W153562 - 608.636.3690 �` = 832 \ 5.01//I�/ - 98AMERICALRBORVITAE/ PLANTED 8'0Y CENTER IN STAGGERED R�WSB'APART \ \ B tDING�E8A6K \ \ 83o 824 828 O0 y / ///// \ \ \ \ \ — _ _ — C828 / k ISSUED 824 / I� / / / / / I Issued for Review-July 29,2015 07 \ �' � � - - - - - - � . 1 -Q 4✓ 824 \ \ \ -- L 00D IV 822 LAN EXISTING TREES J \ w \ 2 STO R 60 UNITS I I I I I I 60 U/G PAR G STALLS I I �/� I II I I I I I U J � ,II I I I I I I I I I I II I I I i � � III I II I I I I \ QQQ 814 ,I 11111 I I I ` 814 � � � l III 111111 111 - - - - - - - - - - - - - 814 814 916\ �', III III I I I I I I \ PROJECT TITLE SFOR \ yI \ \ \ 81 3 I I I I I I I I Applewood IV TRA : \ � I \ � I 812, \ \ \ \ 810 STALLLIS X08 � 808 81 4 rUV 14 - - _ I w � 3 \ \ I EXISTING TREES 806 J r I I dao e SAWAR, -- 3275 Pennsylvania Ave 6 , —�� Dubuque, Iowa 804 — SHEET TITLE 790 92 Site Plan - - - - - - - - - - - - - - - - - - - - - - - - - - - — — 12 WATER — SHEET NUMBER I I - - - - - - - - - - - - - - - - - - - - - - - — T GRAPHIC SCALECM I I SITE PLAN 20 40 I I C-I•I I”= 20'1 (IN FEET) PROJECT NO. OOOO I INCH=20 FT(24X36 PAPER) O I0 2013 Knothe & Bruce Architects, LLC Applewood IV Sources and Uses Statement September 29, 2015 ---------------------------------------------------------------------------------------------------- Sources of Funds Permanent Mortgage $1,965,000 State HOME Funds $503,000 Tax abatement—Private loan $650,000 Federal Home Loan Bank Des Moines AHP $360,000 Tax Credit Equity $5,714,695 $9,192,695 Uses of Funds Land Acquisition $350,000 Hard Costs $6,682,535 Soft Costs $1,738,130 Financing and Reserves $422,030 $9,192,695 9P29Y1015 Filename Palo Perot IV 09 2415 Applewood IV INCOME EXPENSE&CASH FLOW PROJECTED CASH FLOW WITH TAX ABATEMENT 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 INCOME: GROSS RENTAL INCOME 282,415 486964 496703 506,63] 516]]0 52],105 53],64] 548,400 559368 570,555 581966 593,605 605,4]] 61]58] 629939 642,538 COMMERCIAL INCOME 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 LESS VACANCIES RESIDENTIAL (104,225) (34,08]) (34,]69) (35,465) (36,1]4) (36,89]) (37,635) (38 388) (39,156) (39,939) (40,]38) (41 552) (42383) (43 231) (44,096) (44,978) LESS VACANCIES COMMERCIAL 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 NET RENTAL INCOME 178 190 452,8]] 461934 4]1,1]2 480596 490208 500,012 510,012 520212 530,616 541228 552,053 563,094 574 356 585,843 597,560 OTHER INCOME 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 CABLE&TELEPHONE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 PARKING 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OPERATING INCOME 178 190 452,8]] 461934 4]1,1]2 480596 490208 500,012 510,012 520212 530,616 541228 552,053 563,094 574 356 585,843 597,560 LESS OPERATING EXPENSES 112,582 199,085 204,]86 210,653 216,689 222902 229295 235,8]4 242,644 249,611 256,]81 264,160 2]1,]53 279 568 28],610 295,887 NET OPERATING INCOME 65,608 253,]92 25],148 260519 263 907 26]306 270,717 2]4,138 2]]568 281,005 284,447 28],893 291341 294,]88 298233 301,6]3 NON-OPERATING INCOME(EXPENSE): INTEREST INCOMERESERVE0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 MAINTENANCE REPLACEMENT RESERVE (10,500) (18 315) (18,864) (19,430) (20,013) (20,614) (21 232) (21,869) (22525) (23201) (23,89]) (24,614) (25352) (26,113) (26,896) (2],]03) INTEREST EXPENSE (82,972) (114,459) (154,]19) (152,658) (150,470) (148,146) (145,680) (143,061) (140 280) (137329) (134,195) (130,868) (127335) (123 585) (119,603) (115376) ENGINEERING FEE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 DEPRECIATION (203,586) (350,405) (330 277) (319,053) (318,806) (306,836) (299,693) (299,69]) (299,693) (299,693) (299,69]) (299,693) (299,697) (299,693) (299,69]) (298,749) AMORTIZATION 12,909 22,130 22,130 22130 22,130 13,438 7230 ]230 ]230 7230 ]230 ]230 7230 ]230 ]230 7230 309,967 505310 525991 (513 271) 511,419 489,035 473,835 4]1,856 469,]29 467,453 465,018 462,405 459,614 456621 453,426 449,059 REPORT.INCOMEI(LOSS) (244358) (251 518) (268,843) (252,]52) (24]512) (221,]29) (203 118) (19],]18) (192,161) (186,448) (180 571) (174 512) (168273) (161,833) (155,193) (147386) DEPRECIATION 203,586 350,405 330 277 319,053 318,806 306,836 299,693 299,69] 299,693 299,693 299,69] 299,693 299,697 299,693 299,69] 298,749 AMORTIZATION 12,909 22,130 22,130 22130 22,130 13,438 7230 ]230 ]230 7230 ]230 ]230 7230 ]230 ]230 7230 ADOTESS)ACCRUED FEE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ADOTESS)ACCRUED INTEREST 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ADD INTEREST TO DEBT 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 SUBTOTAL 216,495 372535 352,407 341,183 340936 320 275 306,923 306927 306923 306,923 306927 306923 306,927 306923 306927 305,979 PRINCIPAL REDUCTION 25,000 46,194 58,420 60,481 62,669 64993 67,459 ]0,0]8 ]2,859 75,810 (78 944) 82271 85,804 89554 93536 9],]63 OPERATING CASH FLOW (52,863) ]4,824 25,145 27,950 30,]55 33553 36346 39,130 41904 44,665 47,411 50,140 52,850 55536 58,198 60,831 REPLACEMENT RESERVE 0 0 0 0 0 0 0 0 0 0 0 PENTUPRESERVE 56363 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 SUBTOTAL RESERVES 56363 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ASSET MANAGEMENT FEE (3,500) (6,120) (6242) (6367) (6,495) (6624) (6,]5]) (6,892) (],030) (]1]1) (]314) (7,460) (7,609) (],]62) (]91]) (60,831) DEFERRED DEVELOPMENT FEE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 INCENTIVE MANAGEMENT FEE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TAX BENEFIT ONLY EXPENSES 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 CASHFLOW 0 68.]04 18902 21582 24260 26929 29589 32238 34.8]4 37495 40.09] 42.680 45240 4]]]5 50281 0 Deb[Service Coverage mus[pay 051 125 1 2 128 130 131 133 134 136 1 3 1. 40 141 143 144 146 Deb[service Coverage 1s[Mort. 050 125 1 2 128 130 131 133 134 136 1 3 138 140 141 143 144 146 1-1 Prellminarywork For Discussion only ... Page 9P29Y1015 Filename Part swood IV 09 2415 without tax abatement Applewood IV INCOME EXPENSE&CASH FLOW PROJECTED CASH FLOW WITHOUT TAX ABATEMENT 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 INCOME: GROSS RENTAL INCOME 282,415 486964 496703 506,63] 516]]0 52],105 53],64] 548,400 559368 570,555 581966 593,605 605,4]] 61]58] 629939 642,538 COMMERCIAL INCOME 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 LESS VACANCIES RESIDENTIAL (104,225) (34,08]) (34,]69) (35,465) (36,1]4) (36,89]) (37,635) (38 388) (39,156) (39,939) (40,]38) (41 552) (42383) (43 231) (44,096) (44,978) LESS VACANCIES COMMERCIAL 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 NET RENTAL INCOME 178190 452,8]] 461934 4]1,1]2 480596 490208 500,012 510,012 520212 530,616 541228 552,053 563,094 574 356 585,843 597,560 OTHER INCOME 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 CABLE&TELEPHONE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 PARKING 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OPERATING INCOME 178190 452,8]] 461934 4]1,1]2 480596 490208 500,012 510,012 520212 530,616 541228 552,053 563,094 574 356 585,843 597,560 LESS OPERATING EXPENSES 152,709 269,0]8 2]6,8]8 284 907 293,1]2 301,6]9 310,435 319,448 328,]25 338275 348,105 358223 368,639 379 360 390396 401,]56 NET OPERATING INCOME 25,481 183,]99 185,056 186265 187,424 188529 189,5]] 190564 191,48] 192341 193,123 193,830 194,455 194996 195,447 195,804 NON-OPERATING INCOME(EXPENSE): INTEREST INCOMERESERVE0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 MAINTENANCE REPLACEMENT RESERVE (10,500) (18 315) (18,864) (19,430) (20,013) (20,614) (21 232) (21,869) (22525) (23201) (23,89]) (24,614) (25352) (26,113) (26,896) (2],]03) INTEREST EXPENSE (82,972) (115,894) (156,849) (154,]60) (152541) (150,186) (147,685) (145,030) (142212) (139219) (136,042) (132,669) (129,088) (125 286) (121 250) (116,965) ENGINEERING FEE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 DEPRECIATION (203,586) (350,405) (330 277) (319,053) (318,806) (306,836) (299,693) (299,69]) (299,693) (299,693) (299,69]) (299,693) (299,697) (299,693) (299,69]) (298,749) AMORTIZATION 12,951 22202 22202 22202 22202 13510 7302 ]302 ]302 7302 ]302 ]302 7302 ]302 ]302 7302 310,009 506,81] 528,193 515,445 513563 491,146 475,913 4]3,898 4]1,]32 469,415 466938 (464 278) 461,439 458394 455,145 450,719 REPORT.INCOMEI(LOSS) (284,527) (323,018) (343,13]) (329,180) (326,139) (302,61]) (286336) (283 334) (280 245) (277,074) (2]3,815) (270,448) (266,984) (263 398) (259,698) (254,915) DEPRECIATION 203,586 350,405 330 277 319,053 318,806 306,836 299,693 299,69] 299,693 299,693 299,69] 299,693 299,697 299,693 299,69] 298,749 AMORTIZATION 12,951 22202 22202 22202 22202 13510 7302 ]302 ]302 7302 ]302 ]302 7302 ]302 ]302 7302 ADOTESS)ACCRUED FEE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ADOTESS)ACCRUED INTEREST 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ADD INTEREST TO DEBT 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 SUBTOTAL 216,537 3]2,60] 352,479 341255 341,008 320 347 306,995 306999 306995 306,995 306999 306995 306,999 306995 306999 306,051 PRINCIPAL REDUCTION 25,000 46,486 58,880 60,969 63,188 65543 68,044 ]0,699 (73 517) 76,510 ]9,68] 83,060 86,641 90,443 94,479 98,764 OPERATING CASH FLOW (92,990) 3,104 (49 537) (48,894) (48 318) (4],814) (47384) (4],034) (46,]6]) (46,589) (46503) (46513) (46626) (46,846) (4],1]8) (47,628) REPLACEMENT RESERVE 0 0 0 0 0 0 0 0 0 0 0 PENTUPRESERVE 96,490 3,016 0 0 0 0 0 0 0 0 0 0 0 0 0 0 SUBTOTAL RESERVES 96,490 3,016 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ASSET MANAGEMENT FEE (3,500) (6,120) (6242) (6367) (6,495) (6624) (6,]5]) (6,892) (],030) (]1]1) (]314) (7,460) (7,609) (],]62) (]91]) 47,628 DEFERRED DEVELOPMENT FEE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 INCENTIVE MANAGEMENT FEE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TAX BENEFIT ONLY EXPENSES 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 CASHFLOW 0 0 (55.]80) (55262) (54.813) (54,438) (54 141) (53 926) (53.]9]) (53,759) (53.81]) (53 973) (54236) (54.60]) (55.095) 0 Debt Service Coverage must pay 014 0.8] 0.87 -0 087 0.88 0.88 088 0.88 0.89 089 0.89 0.89 089 0.89 0.88 088 Debt service Coverage 1st Mort. 013 0.8] 0.8] 087 0.88 0.88 088 0.88 0.89 089 0.89 0.89 089 0.89 0.88 088 1-1 Prellminarywork For Discussion only ... Page r �k c �cr � y F �3 i 5 8•� Applewood IV Senior Housing Estimated Property Tax Calculation and Abatement Schedule October 26,2015 Calculation of Net Operating Income Calculation of Annual Tax Increase to City Gross potential residential rent $ 484,140 Assessed Value-Improved $ 2,592,413 LESS:Residential vacancy 7.00% $ (33,890) Assessed Value-Existing $ 180,320 Net Rental Income $ 450,250 Assessed Value-Increase $ 2,412,093 Residential rollback to be applied 90% Add:Parking income $ - Assessed Value for taxation $ 2,170,883 Add:Laundry income $ City of Dubuque 2015 tax rate 0.03301933 Add:Storage income $ - Annual Property Tax Increase over Existing $ 71,681 Total Operating Income $ 450,250 10 YEAR TAX ABATEMENT-100% Less:Operating expenses(excluding taxes) $ (185,971) Less:Reserves $ (18,000) Annual Property Tax Increase over Existing $ 71,681 Net Operating Income $ 246,279 REBATE% PROJECT Calculation of Annual Property Tax Year1 100% $ 71,681 Year 2 100% $ 71,681 Capitalization Rate 9.50% Year3 100% $ 71,681 Assessed Value $ 2,592,413 Year4 100% $ 71,681 Residential rollback to be applied 90% Year 5 100% $ 71,681 Assessed Value for taxation $ 2,333,171 Year6 100% $ 71,681 City of Dubuque 2015 tax rate 0.03301933 Year 7 100% $ 71,681 Expected Annual Property Tax $ 77,040 Year8 100% $ 71,681 Year9 100% $ 71,681 Year 10 100% $ 71,681 Notes: NO1 and tax talc methodology and rates provided by Dubuque City Note:10 year abatement illustrated above would benefit project Assessor on August 14,2015. Assessor:Rick Engelken(563-589-4416) in the form of a developer loan from 3rd party lender Applewood IV �� Sources and Uses Statement October 27, 2015 ° ---------------------------------------------------------------------------------------------------- Sources of Funds Permanent Mortgage $1,965,000 State HOME Funds $503,000 Tax abatement—Private loan $553,500 Federal Home Loan Bank Des Moines AHP $36000 Deferred Development Fee $92,607 Tax Credit Equity $5,715,924 $9,190,031 Uses of Funds Land Acquisition $350,000 Hard Costs $602,535 Soft Costs $1,738,466 Financing and Reserves $419,030 $9,190,031 10/272015 om".71 cT z 7 apt, Filename: Applewood IV 10-26-15 INCOME EXPENSE & CASH FLOW. .e 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 INCOME: GROSS RENTAL INCOME 282,415 486,964 496,703 506,637 516,770 527,105 537,647 548,400 559,368 570,555. 581,966 593,605 605,477 617,587 629,939 642,538 COMMERCIAL INCOME 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 LESS VACANCIES RESIDENTIAL (104,225) (34,087) (34,769) (35,465) (36,174) (36,897) (37,635) (38,388) (39,156) (39,939) (40,738) (41,552) (42,383) (43,231) (44,096) (44,978) LESS VACANCIES COMMERCIAL 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 NET RENTAL INCOME 178,190 452,877 461,934 471,172 480,596 490,208 500,012 510,012 520,212 530,616 541,228 552,053 563,094 574,356 585,843 597,560 OTHER INCOME 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 CABLE 8. TELEPHONE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 PARKING 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 OPERATING INCOME 178,190 452,877 461,934 471,172 480,596 490,208 500,012 510,012 520,212 530,616 541,228 552,053 563,094 574,356 585,843 597,560 LESS OPERATING EXPENSES 151,689 195,617 203,364 211,339 219,547 227,995 236,691 245,642 254,856 264,340 274,102 355,832 366,176 376,823 387,783 399,065 NET OPERATING INCOME 26,501 257,260 258,570 259,833 261,049 262,213 263,321 264,370 265,356 266,276 267,126 196,221 196,918 197,533 198,060 198,495 NON-OPERATING INCOME (EXPENSE): INTEREST INCOME -RESERVE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 MAINTENANCE REPLACEMENT RESERVE (10,500) (18,315) (18,864) (19,430) (20,013) (20,614) (21,232) (21,869) (22,525) (23,201) (23,897) (24,614) (25,352) (26,113) (26,896) (27,703) INTEREST EXPENSE (83,300) (103,543) (122,147) (118,368) (114,399) (110,228) (105,848) (101,246) (96,412) (91,334) (86,000) (80,397) (77,219) (74,694) (72,039) (69,248) ENGINEERING FEE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 DEPRECIATION (203,592) (350,418) (330,290) (319,065) (318,818) (306,849) (299,706) (299,709) (299,706) (299,706) (299,709) (299,706) (299,709) (299,706) (299,709) (298,762) AMORTIZATION (12,151) (20,830) (20,830) (20,830) (20,830) _(12,138) (5,930) (5,930) (5,930) (5,930) (5,930) (5,930) (5,930) (5,930) (5,930) (5,930) (309,543) (493,105) (492,131) (477,693) (474,060) (449,829) (432,716) (428,754) (424,573) (420,171) (415,536) (410,646) (408,210) (406,442) (404,574) (401,643) REPORT.INCOME/(LOSS) (283,042) (235,845) (233,561) (217,860) (213,011) (187,616) (169,395) (164,384) (159,217) (153,895) (148,410) (214,425) (211,292) (208,909) (206,514) (203,148) DEPRECIATION 203,592 350,418 330,290 319,065 318,818 306,849 299,706 299,709 299,706 299,706 299,709 299,706 299,709 299,706 299,709 298,762 AMORTIZATION 12,151 20,830 20,830 20,830 20,830 12,138 5,930 5,930 5,930 5,930 5,930 5,930 5,930 5,930 5,930 5,930 ADD/(LESS) ACCRUED FEE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ADD/(LESS) ACCRUED INTEREST 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ADD INTEREST TO DEBT 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 SUBTOTAL 215,743 371,248 351,120 339,895 339,648 318,987 305,636 305,639 305,636 305,636 305,639 305,636 305,639 305,636 305,639 304,692 PRINCIPAL REDUCTION (25,000) (86,940) (99,884) (103,663) (107,633) (111,803) (116,183) (120,785) (125,619) (130,697) (136,031) (87,458) (74,363) (76,889) (79,544) (82,334) OPERATING CASH FLOW (92,299) 48,463 17,674 18,371 19,004 19,568 20,058 20,470 20,800 21,044 21,198 3,753 19,983 19,838 19,581 19,209 REPLACEMENT RESERVE 0 0 0 0 0 0 0 0 0 0 0 RENT -UP RESERVE 95,799 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 SUBTOTAL RESERVES 95,799 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ASSET MANAGEMENT FEE (3,500) (6,120) (6,242) (6,367) (6,495) (6,624) (6,757) (6,692) (7,030) (7,171) (7,314) (7,460) (7,609) (7,762) (7,917) (19,209) DEFERRED DEVELOPMENT FEE (42,343) (11,432) (12,004) (12,510) (12,944) (1,375) 0 0 0 0 3,707 (3,707) 0 0 0 INCENTIVE MANAGEMENT FEE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TAX BENEFIT ONLY EXPENSES 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 CASH FLOW 0 0 0 0 0 0 11 926 13,578 13,770 13,873 13,884 0 8,667 12,076 11,664 0 ""' Preliminary Work - For Discussion Only ""' Page 4 10/27/2015 Applewood IV OPERATING EXPENSES,ir:.. pargnin9 till OCT 27201 Filename: Applewood IV 10-26-15 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 INITIAL YEAR LOP,ERQTIN,G;EXPE: Advertising 2,625 4,579 4,716 4,858 5,003 5,153 5,308 5,467 5,631 5,800 5,974 6,153 6,338 6,528 6,724 6,926 4,500 Management Fee 10,691 27,173 27,716 28,270 28,836 29,412 30,001 30,601 31,213 31,837 32,474 33,123 33,786 34,461 35,151 35,854 0 OVERSIGHT FEE 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Administrative Rent Credit 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Office Expense 4,142 7,224 7,441 7,664 7,894 8,131 8,375 8,626 8,885 9,151 9,426 9,709 10,000 10,300 10,609 10,927 7,100 Accounting/Audit 6,500 6,614 6,812 7,017 7,227 7,444 7,667 7,897 8,134 8,378 8,629 8,888 9,155 9,430 9,713 10,004 6,500 HFA Compliance Fee 1,500 1,526 1,572 1,619 1,668 1,718 1,769 1,822 1,877 1,933 1,991 2,051 2,113 2,176 2,241 2,309 1,500 Office Salaries: 13,029 22,727 23,409 24,111 24,834 25,579 26,347 27,137 27,951 28,790 29,653 30,543 31,459 32,403 33,375 34,376 22,336 Resident 0 0 0 0 0 0 0 0• 0 0 0 0 0 0 0 0 0 Internet & Software 700 1,221 1,258 1,295 1,334 1,374 1,415 1,458 1,502 1,547 1,593 1,641 1,690 1,741 1,793 1,847 1,200 Subtotal 39,187 71,064 72,924 74,834 76,797 78,812 80,882 83,009 85,193 87,437 89,741 92,109 94,541 97,039 99,606 102,242 43,136 Repairs & Maintenance 14,000 24,420 25,153 25,907 26,684 27,485 28,309 29,159 30,034 30,935 31,863 32,818 33,803 34,817 35,862 36,937 24,000 Turnover 4,375 7,631 7,860 8,096 8,339 8,589 8,847 9,112 9,385 9,667 9,957 10,256 10,563 10,880 11,207 11,543 7,500 Pest Control 420 733 755 777 801 825 849 875 901 928 956 985 1,014 1,045 1,076 1,108 720 Grounds Expense 3,675 6,410 6,603 6,801 7,005 7,215 7,431 7,654 7,884 8,120 8,364 8,615 8,873 9,139 9,414 9,696 6,300 Snow Removal 3,500 6,105 6,288 6,477 6,671 6,871 7,077 7,290 7,508 7,734 7,966 8,205 8,451 8,704 8,965 9,234 6,000 Trash Removal 2,625 4,579 4,716 4,858 5,003 5,153 5,308 5,467 5,631 5,800 5,974 6,153 6,338 6,528 6,724 6,926 4,500 Elevator 1,867 3,256 3,354 3,454 3,558 3,665 3,775 3,888 4,004 4,125 4,248 4,376 4,507 4,642 4,782 4,925 3,200 Subtotal 30,462 53,134 54,728 56,370 58,061 59,803 61,597 63,445 65,348 67,308 69,328 71,407 73,550 75,756 78,029 80,370 52,220 Electric 12,600 21,978 22,637 23,316 24,016 24,736 25,479 26,243 27,030 27,841 28,676 29,537 30,423 31,335 32,275 33,244 21,600 Gas 8,750 15,263 15,720 16,192 16,678 17,178 17,693 18,224 18,771 19,334 19,914 20,512 21,127 21,761 22,413 23,086 15,000 Water& Sewer 7,000 12,210 12,576 12,954 13,342 13,742 14,155 14,579 15,017 15,467 15,931 16,409 16,901 17,409 17,931 18,469 12,000 Subtotal 28,350 49,451 50,934 52,462 54,036 55,657 57,327 59,046 60,818 62,642 64,522 66,457 68,451 70,505 72,620 74,798 48,600 Insurance 8,750 15,263 15,720 16,192 16,678 17,178 17,693 18,224 18,771 19,334 19,914 20,512 21,127 21,761 22,413 23,086 15,000 Real Estate Taxes 44,940 78,388 80,740 83,162 85,657 88,226 90,873 93,599 96,407 99,300 102,278 105,347 108,507 111,762 115,115 118,569 77,040 Real Estate Tax Abatement (71,681) (71,681) (71,681) (71,681) (71,681) (71,681) (71,681) (71,681) (71,681) (71,681) TOTAL OPERATING EXPENSES 151 689 195,617 203,364 211,339 219,547 227,995 236,691 245,642 254,856 264,340 274,102 355,832 366,176 376,823 387,783 399,065 OP EXP % OF NET RENT INC 85.13% 43.19% 44.02% 44.85% 45.68% 46.51% 47.34% 48.16% 48.99% 49.82% 50.64% 64.46% 65.03% 65.61% 66.19% 66.78% TOTAL OPER EXP PER UNIT 2,528 3,260 3,389 3,522 3,659 3,800 3,945 4,094 4,248 4,406 4,568 5,931 6,103 6,280 6,463 6651 LESS TAXES, AUDIT & COMPLIANCE FEE 1,646 1,818 1,904 1,992 2,083 2,177 2,273 2,372 2,474 2,579 2,687 3,992 4,107 4,224 4,345 4,470 MORTGAGE HOME Funds ABATEMENT LOAN AHP TIF Grant BRIDGE LOAN CONSTRUCTION LOAN TOTAL INTEREST EXPENSE Total O 65,222 96,611 95,078 93,466 91,771 89,990 88,118 86,150 84,082 81,907 79,622 77,219 74,694 72,039 69,248 1,245,219 O 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 O 27,675 25,536 23,291 20,933 18,457 15,857 13,128 10,262 7,252 4,093 775 0 0 0 0 167,259 O 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 O 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 O 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 O 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 83,300 10,645 0 0 0 0 0 0 0 0 0 0 0 0 0 0 93,945 83,300 103,543 122,147 118 368 114,399 110,228 105,848 101,246 96,412 91,334 86,000 80 397 77 219 74 694 72 039 69,248 1,506 423 "' Preliminary Work - For Discussion Only Page 5 RESOLUTION NO. 400-15 RESOLUTION FINDING THAT THE DESIGNATION OF THE LANGE ESTATE URBAN REVITALIZATION PLAN IS NECESSARY TO ENCOURAGE NEEDED HOUSING AND RESIDENTIAL DEVELOPMENT PROVIDING SAFE, AFFORDABLE HOUSING FOR THE RESIDENTS OF THE CITY OF DUBUQUE, IOWA Whereas, the City Council of the City of Dubuque finds that the property at 3275 Pennsylvania Avenue (Property) is currently vacant and underutilized, and Horizon (Horizon) has proposed to develop the Property by constructing a 60 -unit residential housing development for seniors; and Whereas, the City supports the development and construction of housing and residential properties which provide quality, affordable housing; and Whereas, the Property is located in an area eligible for the Urban Revitalization Tax Exemption program; and Whereas, in the area proposed for designation under the Urban Revitalization Act there is need for public improvements related to housing and the encouragement of housing 'and residential development as defined by Section 404.1(5) of the Iowa Code; and Whereas, through the Urban Revitalization Program, the Property is eligible to receive a one hundred percent exemption from taxation on the actual value added by the improvements for a period of ten years so long as it is assessed as residential property or assessed as commercial property, if the commercial property consists of three or more separate living quarters with at least seventy-five percent of the space used for residential purposes. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF DUBUQUE, IOWA: Section 1. The new construction housing development at the Property legally described as Lot Two of Lange Estate in the County of Dubuque, City of Dubuque, Iowa, according to the recorded plat thereof is deemed necessary and in the interest of the residents of the City. Section 2. That the City Council supports the Horizon Petition asking the Property be designated an Urban Revitalization Area and supports Horizon's efforts to receive a tax credit award from the Iowa Finance Authority for this Development. Section 3. The City Council approves supporting the project and authorizes staff to work with the City Assessor to complete the form 5S for the Developer's submission to the Iowa Finance Authority prior to the December 7, 2015 deadline for consideration. Section 4. The proposed Development is consistent with the City of Dubuque's affordable housing strategies and goal to implement the City's comprehensive plan. Passed, approved and adopted this 16th day of Novemb r, 2015. Attest: Roy D. B . I, Mayor EXHIBIT 5S IOWA FINANCE AuT110 RITY LOCAL GOVERNMENT CONTRIBUTION Form(s) shall be completed by the qualified Government Entity or Political Subdivision along with any additional supporting documents as required in QAP Section 6.2.3. RE: Project Name Applewood IV Project Address 3275 Pennsylvania Avenue, Dubuque, IA 52001 Ownership Entity Name Applewood IV LLC Iowa Finance Authority (IFA) encourages developers to coordinate with Iowa communities regarding community revitalization plans, where applicable. A Local Government Contribution creates a presumption that the project is not in conflict with the local government's community revitalization plan, if any. This form will verify the Local Government Contribution effort referenced in the Qualified Allocation Plan (QAP). A Local Government Contribution can be provided by a qualified Government Entity or Political Subdivision. QAP Section 6.2.3 states the following items will constitute a Local Government Contribution: Form of Contribution Additional Supporting Documents Cash Contribution Commitment letter Gift of Land or Building Third party MAI certified appraisal Tax Abatement (not tax exemption) Scoring exhibit only Tax Increment Financing Project specific resolution of the city council Urban Revitalization Tax Exemption (URTE) Project specific resolution of the city council Workforce Housing Tax Credits Commitment letter from Iowa Economic Development Authority (IEDA) Enterprise Zone Credits Scoring exhibit only Enterprise Zone Sales Tax Rebates Scoring exhibit only Waiver of Fees Scoring exhibit only City HOME Scoring exhibit only Below Market Interest Rate Loan Calculation showing value of imputed savings using a market rate of seven percent (7%) QAP Section 6.2.3 states the agency making the Local Government Contribution shall indicate the value of its contribution. The value of the Local Government Contribution is the value of the contribution made by the qualified Government Entity or Political Subdivision minus the value of any consideration or accommodation received by the qualified Government Entity or Political Subdivision in return for the contribution. The Governmental Entity or Political Subdivision completing this form understands that IFA will rely on these valuations to determine whether the Applicant has met the requirements of the QAP to receive points for Local Government Contribution. For scoring purposes under this category, a Government Entity or Political Subdivision contribution to a Project provided through a certified Local Housing Trust Fund (LHTF) will be considered a qualified Local Government Contribution only if the Applicant provides documentation from the LHTF showing the Government Entity or Political Subdivision has made contributions to the LHTF during the current fiscal year totaling at least the amount of the proposed Local Government Contribution to the Project. Qualified Governmental Entity or Political Subdivision Contribution(s) (21 points maximum) 2015 Round — 2014.10.08 EXHIBIT 5S ❑ CASH CONTRIBUTION — Commitment letter attached IOWA FINANCE Amount Source of Cash Name of Entity Making Contribution ❑ GIFT OF LAND — Third party MAI certified appraisal attached Appraised Amount/Value Name of Entity Making Contribution Location/Address of property: Is land held free and clear of encumbrances? ❑ YES ❑ NO If NO, disclose all known liens and encumbrances and explain how and when these will be satisfied. ❑ GIFT OF BUILDING —Third party MAI certified appraisal attached Appraised Amount/Value Name of Entity Making Contribution Address of building(s): Is land held free and clear of encumbrances? ❑ YES ❑ NO If NO, disclose all known liens and encumbrances and explain how and when these will be satisfied. ❑ TAX ABATEMENT (not exemption) — No attachment required Amount/Value Term of Abatement Describe How Amount Was Determined Name of Entity Making Contribution $780,604 10 years See attached estimated property tax calculation and abatement schedule. City of Dubuque O TAX INCREMENT FINANCING — Project specific resolution from the City Council attached Amount/Value Name of Entity Making Contribution URBAN REVITALIZATION TAX EXEMPTION — Project specific resolution Amount/Value Term of Exemption Describe How Amount Was Determined Name of Entity Making Contribution $780,604 10 years See attached estimated property tax calculation and abatement schedule. City of Dubuque ❑ WORKFORCE HOUSING TAX CREDIT (equity value) — Commitment letter from Iowa Economic Development Authority attached Amount/Value Name of Entity Making Contribution O ENTERPRISE ZONE CREDIT (equity value) — No attachment required Amount/Value Name of Entity Making Contribution O ENTERPRISE ZONE SALES TAX REBATE — No attachment required. Amount/Value Name of Entity Making Contribution 2015 Round — 2014.10.08 EXHIBIT 5S IOWA FINANCE Amount/Value Type of Fees Describe Ho Determined Amnun Namonf Entity kin ntribuUon D CITY HOME LOAN — No attachment required Amount/Value Name of Entity Making Contributiori El BELOW-MARKET INTEREST RATE LOAN - Calculation showing value of imputed savings u ng a market rate of seven percent (7%) attached Amount/Value Market Interest Rate Below- Market Interest Rate Describe How Caiculated Name of Entity Making Sayings Was Determined Contribution City of Dubuque 11/25/2015 Agency Name (Typed) Date Rev O,8 cf Name of Agency Repr entative (Typed) Mayor Title of Agency Representative (Typed) "8igna — Agency Representative 2015 Round — 2014.10.08