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Iowa Historic Tax Credit Report Copyrighted October 7, 2019 City of Dubuque Consent Items # 9. ITEM TITLE: lowa Historic Tax Credit Report SUMMARY: City Manager providing a copy of the lowa Historic Tax Credit Report. SUGGESTED DISPOSITION: Suggested Disposition: Receive and File ATTACHMENTS: Description Type lowa Historic TaxCredits Report Supporting Documentation lowa Historic TaxCredits Supporting Documentation � � � . � , _ e � � � �,� � .— . . - � ('' �C o ■ ■ r� t � � � � -_ �� '`!� � ,�``�-� _ _ ____ �_ _ ' =- � : I _ = - ====== �` � - � _ �� - \ _-=-_-- � _ .-,� .,� � � "�- /I� ' 1 � � 4. � , , i�� sa _ -.-' _,_ _ _ � � :�� _ — � � -s � � � '�, _�. . ` ,�� -�� _.�_ �� r � ��: 3 k�,° ,�;.; — --- �-- ' � � ��.� �� [ _ — ,� i ��: .� � � � , � � � �� , .. � � , ��, d � � ��i n ��;��,� — a� � �� _ � �r� � ii �� . � � . � — ' _� 9;� ��* � � -- - . � � . � P �"- . .; , -� � :.- , _. . F � �i i nnr�;` i P � eva «� t I,ud AAEI ��8 � d�a �a� �Q ,� — - "� !� _� �—. � �a_, — _ . _� �_�.—� . � -:� u ,� .. � �I uuli'�° IIIIIIII y'� �� ;I'��Ilfll� ia�i �� I� [I 6[ ,1�' � � � i_i�l�[l�Ef�E6 ��.111.i��. � �11iti ="�.� �� :,� �� ,� , �+� � ,n � u �I��16a f .�� 1� �—��.�� c� � �- a ;�� ;� �_�.. � �� _ � � , w ` a ' pr � � ' '-"��i '�� . �" , " - � �, � �._�4- Ii �� i � � . � � - � � , �� ' �� - iiii '�e il iiii . N�� ° ' " —�� ..�._ � � ' �=^�.� � � , TT�.�,�,� ;��.•`_._�� ,�� ,� Table of Contents 1 . The lowa S[a[e Hisroric Preservation and Cukurel & Eirtertainmen[ Dirtric[ (HPCED) Tax Cred'R Progrem 2. ExeMive Summary 3. MMhodology 4. conshuaion Period 7. Prolect Operetions c4. HirtoricTazCredi[ ReportSummaryMlmpac6 Appendix r �� . � � TFc . i --�=- . '.-�,_.-.- ` g =: , _ �d-,-�_ � . _ � . - . \ , , . ' . � � � � � � -� ' �• � � �- � -� � .� � � � � '� �- � �. � � � , -� . � - � � � �� - � �• . � � �- � -� � � � � � � . -� ,.� � - �- � •' � � � � • ��. � -� - � - � i � .� - -� - � �• . - �� . � -�- . � �• . ��- . �- � � �• . � � � -� . � - -� � � � � � . � � � � � . � i � � -�- � -� � 11 , 1 • � . .-� � - •� �. , • .� -� , � � � - � � - .� � . �- - �� - i . � � A notable impact from having access to state historic tax credits is that it helps facilitate and leverage federal historic tax credits. In 2015, the National Park Service documented that nearly half of all preservation projects that used the federal credit also received a state-level credit, and that states with credits that coordinate better with ihe federal credit tend to be the heaviest users of the federal program. For instance, NTHP analysis found Missouri's state historic tax credit doubled the usage of the federal incentive when it was put into place. While every state is different, the basic structure of the program is comparable across most states. The following are some relevant findings from states with recent reports on their programs that possess state-level HTCs and those that do not: ALABAMA-a 2017 report gave the state's 25% QRE HTC program an overall grade of "b" as it "provides important benefits to local, regional and state economies ..." OHIO —Also has a 25% QRE state historic tax credit. A recent report reflected that in the 7 year period ('07-'14) the $482.3 million expended in HTCs attracted $3.16 billion in additional capital or $6.20 to $1 per dollar expended in the form of tax credits under ihe state HTC program. Additionally, the Ohio Development Services Agency undertook an extensive analysis of the impact on property tax collection, not just from historic properties, but from surrounding properties. They found: "Changes in property values for renovated projects also triggered an increase in taxes collected from projects' parcels. Moreover, not only were the collected taxes higher from renovated properties, both adjacent and radial parcel properties yielded sufficiently higher tax revenues. Taxes collected from properties on project parcels increased by about $7.2 million overall, or about 355%. Taxes rose by about 55% on adjacent parcels and by 30% on radial parcels." OREGON — Oregon, which does not have a State HTC program engaged an analyst to review a capped program proposal for 25% QREs. The conclusion was that though the cap might limit investment it would certainly increase it with an expectation that preservation investment would rise to four-fold in the number of projects, double to total investment and yield upwards of $9 million in new property tax for the state. KANSAS — Based on the Rutgers University study from 2010 the Kansas State HTC has markedly increased investment in the state. In the 21 year period prior a total of $114 million inflation adjusted to 2009 dollars was expended on preservation projects. In ihe first 8 years of ihe state credit $271 million was invested, moving from an annual investrnent of $5.4 million to $33.9 million. This overview provides a synopsis of the types of economic drivers that State HTC programs may have and explores to some degree why so many states seek to understand their economic impact and why states like Oregon look to understand how such a program might add to their economic development tools. 1 Executive Summary This report extrapolates across a universe of 117 commercial projects based on data sourced from 26 materially characteristic projects which received lowa State Historic Tax Credit Part III Historic certification from January 2011 to December 2013. A discussion of the methodology follows in brief and at more length at the end of this report. Primary notable results include: • Total IA State HTC expenditure is projected at $103MM for the period under review based on $411.9 MM in QREs. The return on Investment— (ROp — based on direct economic output alone is projected at 5:04 to 1 through year 3. • This increases to 19.68:1 by year 10 and to 32.1:1 by year 15. • Direct construction economic output of $328.1 million and overall construction output of $349.4 million • Direct construction jobs of 5,447 and overall construction jobs of 6,071 • Direct construction wages of $320.9 million • Direct construction vendor related taxes in the State of lowa of $8.3 million • Direct annual operations economic output of $191 million and overall operations output of $209.8 million • Direct operations job generation of 4,103 and overall operations jobs of 4,643 • Direct annual operations wages of $184.3 million • Direct annual operation taxes vendor and production related taxes in the State of lowa of $18.4 million �. .x� ��, - �9'� - . H6 �_�� : A7d �5d� �� "A �� -�. L � ,- , _ �.� ' q � � >, � � � 3 ��- � 1�;;� : � ala � � � �u�� ''��; a� � � � � 3 3iy� _ _-- .� .. Methodology This report utilizes information from 26 projects that filed Part III Historic Preservation Certificate Applications for IA State Historic Tax Credits (HTCs) between January 2011 and December 2013. These 26 projects had total Qualified Rehabilitation Expenditures (QREs) of approximately $233,200,000. During this same period, 152 project sites received lowa State HTCs and had more than $447.8 million in QREs. Included in this total are 35 projects that were agricultural, non-profit/non-revenue-producing, or were single family residential in nature which were excluded from this analysis.' Baker Tilly utilized the base data from the 26 sample projects to develop an extrapolated analysis and account for likely impacts on employment, economic output, taxes, and assessed property values across the universe of 117 commercial classified projects. Data was correlated by weighting the sampled projects proportionately by geography, project type and project QRE size. The 26 projects that were surveyed in depth comprised 56.6% of the $411.9 million of QREs under analysis and were sorted into four categories; Apartment, Commercial, Commercial-Hotel and Mixed-Use. The state was broken into 6 geographic areas of analysis as reflected below: � I T � 'We have excluded 35 projects from this analysis (8.0 % of the total lowa QRE universe)that were comprised of projects that were agricultural, non-profit/non-revenue- producing, or were single family resideritial. Overall, agricultural projects were 0.1%, single-family residential projects were 0.6%, and non-profrt projects comprised 7.3%of total 2011-2013 QREs that were built, but excluded from this analysis.For further details on methodology, please see the appendix. 3 Economic Output During the construction period for the 26 projects studied with approximately $233.2 million in QREs, it is estimated more than $197.13 million in total economic output was created, with more than $185.4 million in spending from the projects directly, and $11.6 million in additional supply chain-based economic output. Extrapolating for the entire universe of projects studied with more than $411.9 million in QREs, it is estimated that for the lowa HTC program as a whole, $349.3 million was created statewide in construction economic output from 117 projects in the four categories studied (Apartments, Commercial, Commercial-Hotel, Mixed-Use), with more than $328.1 million in spending from the projects directly, and more than $21.2 million in additional supply chain-based economic output. Table 2: Construction Impact Estimates for Universe of Studied Categories � ' $51,305,689 $1,668,123 , $130,178 $367,616 $53,471,606 $121,405,524 $4,978,494 $363,333 $4,030,576 $130,777,927 $44,167,722 $1,430,121 $89,432 $823,424 $46,510,697 $111,231,626 $4,437,788 $298,965 $2,647,365 $118,615,744 � � • � : � Employment For the 26 sample projects that provided detailed labor and construction information, it is estimated that 3,051 new construction jobs were created from construction activities, with 2,770 directjobs created, and an estimated 288jobs through supply chain activity. Evaluating proportionally across the entire universe of projects studied, it is estimated that 6,071 new construction jobs were created from construction activities, with 5,447 direct jobs created, and an estimated additional 623 jobs through supply chain activity. Table 3: Estimated Construction Employment Effects by Project Type � � � � � � � � � 695 35 4 10 745 1,947 143 7 125 2,222 685 51 2 26 764 2,119 131 5 84 2,340 � � 4 1 1 � ' 11 1 Wages Labor income from direct construction wages is estimated at more than $320.8 million for all projects included in the study. Construction labor income is broken out by types of projects follows in the table below. APT $59,854,897 � � COM $91,215,290 Table 4: Estimated Construction Direct Labor Income by ProjectType � COM-H $43,888,627 MIX $125,913,961 � Grand Total: $320,872,775 TaY Impacts Taxes on Productions and Imports from construction activity within the 26 project sample pool is estimated to have created more than $5.1 million from all vendors, with more than $3.8 million in taxes created from local and lowa state-based construction vendors, and more than $1.2 million from national vendors. Overall, Taxes on Productions and Imports (TPI)from HTC construction activity across the lowa HTC projects included for study is estimated to have created more than $10.9 million from all vendors, with more than $8.2 million in state and local taxes created from construction vendors, and an estimated $2.7 million in taxes paid nationally by vendors. State of lowa personal property taxes would also be realized by construction employees and supply chain vendors as a result of construction labor income. Due to the state's multi-bracketed personal income tax structure, a precise estimate is not possible without greater wage information from construction vendors that were employed on projects that received historic tax credits. Table 5: Estimated Construction Tax Effects by Project Type � � � � , � $546,427 $476,309 $196,506 $1,219,241 $1,648,513 $1,555,857 $1,187,636 $4,392,005 $580,304 $526,814 $320,121 $1,427,238 $1,526,758 $1,422,678 $993,627 $3,943,063 � � �� 5 Geographic Distribution of Construction Impacts The following results are noted based on geographic zone for construction impacts by geographic zone as estimated across the 117 HTC projects included in the exhapolated analysis: I i r s Table 6: Estimated Construction Impacts by Projut Location � � 532 531,472,433 5435,638 519,913,476 221 513,076,595 5268,132 531,331,836 2,564 5157,036,111 52,221,999 Sll3,549,943 607 540,702,483 5406,163 516,418,511 1,071 554,720,339 5643,751 569,867,858 452 531,102,600 5326,319 59,791,153 � � �� : �4e �. � �� '.�. �.. � 6 • � • I I f II Il.q , � ;,:�, � ' � � � ,' _ =_' � 6:t �'�...'. V' _ w_�Y"""'� �. �aP d F ' �' 4�s i s �`. . �� G a.� �� _ Economic Output Annual operations for the projects sampled that received HTCs by the State of lowa are estimated to have created more than $96.1 million in economic output spending, with approximately $87.4 million from direct project sites, and more than $8.7 million in supply chain-based economic output. For the State of lowa as a whole, it is estimated that more than $209.8 million in economic output spending is created annually from HTC project location operations, with approximately$190.9 million from direct project sites, and more than $18.9 million in supply chain-based economic output. Table 7: Estimated Economic Output &om Site Operationa,poaEHTC,by Projut'I�pe � � 57,401,209 5570,587 545,998 555,347 58,073,141 5157,747,687 57,123,356 5461,526 57,611,965 Sll2,944,535 51,511,648 590,502 55,219 5116,785 51,724,154 524,266,767 51,469,668 588,009 51,273,001 527,097,445 • � • .�� • � �. . � . . Employment Based upon the projects that provided tenancy information, it is estimated more than 2,250 new permanent, FTE jobs were created from operations at the sampled project sites, with 2,001 directjobs created, and an estimated 250 FTE jobs ihrough supply chain activity. Across the state of lowa as a whole as a result of projects that received HTCs, it is estimated that more than 4,640 new permanent, annual jobs were created from operations across lowa HTC project sites, with 4,103 direct jobs created, and an estimated 540 annual jobs through realized through supply chain activity. Table 8: Estimated Employment &om Site Operationa � � 103 12 0 2 117 2,759 192 14 229 3,194 111 3 0 3 117 1,129 44 2 40 1,215 - � � 7 Wages Annual labor income from direct wages is estimated at more than $184.3 million for all projects included for study. Operations labor income is broken out by type of project below. � APT $5,653,577 MIX $27,846,768 � , Grand Total: $184,308,043 COM-H $2,929,426 � � � Table 9: Estimated Annual Labor Income from Site Operations, by Project Type � COM $147,878,272 TaY Impacts For the 26 projects sampled, Taxes on Productions and Imports (TPI)from operational activity is estimated to create more than $10.4 million from all vendors annually, with more than $8.8 million in taxes created from local and lowa state-based vendors, and more than $1.6 million is estimated to be created in operational taxes annually from national-based vendors. Across lowa HTC projects as a whole, it is estimated that more than $21.8 million is created in taxes from production and imports annually from all vendor operations, with more than $18.4 million in taxes created from local and lowa state-based vendors, and more than $3.4 million is estimated to be created nationally in operational taxes annually from out of state vendors. As mentioned in the construction section, State of lowa personal property taxes would also be realized annually as a result of site operations labor income. Due to the state's multi-bracketed personal income tax structure, a precise estimate of taxes generated by projected wages is not possible without greater knowledge of personal data related employee wage information from subject property tenants, as noted above. Table 10: Estimated TaYes on Production and Imports (TPI) from Site Operations,by Project Type � � � � , � $249,321 $211,968 $61,220 $522,509 $7,317,701 $6,411,682 $2,733,760 $16,463,144 $312,564 $268,062 $84,791 $665,416 $1,943,296 $1,692,143 $585,134 $4,220,573 � • �- 8 Project Operations (cont.) Property Assessment Value and Impacts Reviewing actual tax records and assessment information for each project sampled, changes in projects' property values could be observed in light of renovation work completed due to the use of the lowa state historic tax credits. Tax and assessment information was provided for parcels for two discrete periods in time; prior to construction, and at stabilization. Prior to receiving tax credits, the 26 sample projects studied had assessed values totaling more than $21.7 million. After projects were completed, the same projects had a new cumulative property tax assessment value of approximately $67.4 million—an increase of 310%, and paid more than $1 J6 million in lowa state and local property taxes annually, as of 2015 and 2016 tax year information. Extrapolating for the 117 HTC project sites funded, and taking into account the types of projects funded, overall it is estimated ihat property assessment values across lowa increased as a whole more than $87.8 million after construction on properties that participated in the program. Due to a variety of state legislative efforts to provide propertytax relief in lowa in recentyears, variable propertytax discounting allowed under state laws, and the ability granted to property owners to discretely negotiate tax relief initiatives individually within local jurisdictions, a full analysis of property taxes collected across taxing entities and any projection of future tax revenue return on investment is not possible for HTC projects under consideration in this analysis. However, an analysis of the change in anticipated assessed value based on data on hand was performed without consideration of legislative effect as noted below: . . SumofActual SumofPc�Aehab SumofCuccevt Profect Type v Sample Meav Aehab Cost Aehab Cost Assessed Value Assessed Value GrandTotal 26 $8,927,147 $232,105,815 $17,151,665 $67,381,375 Sum ofAcNal Estimated Pc�Aehab Estlmated Cuccevt ProfectType NPop MeavAehabCost AehabCost AssessedValue AssessedValue GrandTotal 117 $3,521,121 $411,971,185 $41,616,000 $118,553,000 � f �t. _ - , � r � � ^r _.�q . .�� r�i �� Geographic Distribution of Operational Impacts Estimating the change in properties' assessed values across geographic regions in lowa for the 117 projects that received funding for the project types studied, the following property assessment value increases are estimated: Table 13: Assessed Value Increase by Project Location $s6,sss,629 $35,704,503 $18,838,519 $15,245,687 $7,787,103 _ $31- $4,8- Zone 1 Zone 2 Zone 3 Zone 4 Zone 5 Zone 6 TOTAL Table 14: Estimated Operations Impacts by Project Location 257 1 $17,312,135 $3,833,225 $21,673,589 i 17 $250,509 $36,227 $432,844 3,417 $160,481,851 $5,120,302 $147,925,544 67 $1,076,729 $179,597 $1,834,047 - 248 $10,477,329 $490,028 $10,947,381 97 $1,328,757 $163,505 $1,494,639 � • � �: �- ) y �� I _ . . +~ � � '�T,�.:� --� V! i �• � - . -,�, � -- � �-y-- - ' ; . w � - � F' -- J � � '+ - , '. I . :.: . � �- HTC Report Summary t(�an g1�8:4 mdlGs!�nlfual�irr d' ` .. �'.-d t ey a e � ; . new as�sF�faiok3`eei"ty value, or,�in mt�gase of 28 � � 3,�. ,� - Q�S� a .. , � �. � �`'� s � � �„ ''»��.�, ' -- Addit�r�lJy more�Man 10 100�obs"arg.e�timated to aue��@�t��'`fed tFiro� '�� an $505 rr�f�on in economic output is e54rV�'`ted to.ha�'�¢e�n c�a'tec�Ir�.m prA�ec � , s � r.�. . . - _ `� a�ati.,x,i'��-� � '� °-�.� �,l�"� s._ E s-� '� In looking at the overall return on irtvestment, these pro�Ects pYovl�e�conomic outpt�rat��+ rm c� s r c�'iai an gh � ��ced in service date prior to claiming the IA HTC Looki�ng at ;h,�.first.aoticipated stab�ized�;or y�ea B`ft�ro�ected"�_ � ... that the projects will yield 15.04:1. This yield increases to 19 68 1'by year 10 and�'Vamps� upward to 32.1:1 by year 15 '•�.�� Fhis return ismcalculated on the econc/iic output projections and is�therefore faj�,y conservative. Taking into account the �� ,anticipated increas�in assessed value from date of commencement of�ilita� to the placed in service date of 284%�_;_ and the increased value of $191 million in direct wages (increasing incre tally ertime) the communities served by these`"''" tivities are likely to see higher outcome values. Therefore the projected rate of return is considered to be.,� . � Operations Emnomic Output Emnomic Output ProJutType ToGI ToGlJobs ToGITPI ToGI 1btalJobs ToGITPI GrandTotal $349,375,973 6,071 $10,981,548 $209,839,274 4,643 $21,871,642 � 1 1 ' 1 Glossary Direct Effect: The effect of new input purchases by the initially changed industries. This is the first round of impacts (see °Indirect°). This change is due to inter-industry effects. Indirect Effect: The subsequent ripple effect in further supply chains resulting from the direct change. In more awkward terms, this shows the sales change in the supply chains of the supply chain, as a result of the direct change. This is the second round of impacts (see "DirecY'). This change is due to inter-industry effects. Induced Effect: This change is due to the impact of the new earnings created by the initial, direct, and indirect changes. These earnings enter the economy as employees spend their paychecks in the region on food, clothing, and other goods and services. In other words, this figure represents the income effects on inter-industry trade. Input-Output Model: A mathematical representation of the economic relationships among industries in a region, especially with reference to how much each industry purchases from each other industry. Taxes on Production and Imports: Taxes on production and imports (TPI) consist of tax liabilities, such as general sales and property taxes that are chargeable to business expense in the calculation of profit-type incomes. Special assessments are also included. TPI is comprised of state and local taxes—primarily non-personal property taxes, licenses, and sales and gross receipts taxes—and Federal excise taxes on goods and services. Source: Emsi model, incorporating data from the Bureau of Economic Analysis (BEA). Assumptions The universe of lowa HTC projects for the purposes of this analysis was comprised of 117 project sites that had QREs totaling $411.9 million. The 26 projects that were surveyed in depth comprised 56.6% of the QREs under analysis and were sorted into four categories; Apartment, Commercial, Commercial-Hotel and Mixed-Use. Projects that were chosen for sampling were tested to ensure proper distribution and diversity across communities based on community population size and geographic location in relation to the universe of projects that received lowa HTCs to ensure a reasonable representative sample. N(n)=117 (26) 18 (4) 0(0) 0(0) 3(1) 5(0) 8(2) 2 (1) 65 (8) 5(1) 3(0) 20(3) 5(0) 24(1) 8(3) 4 (3) 0(0) 1 (1) 1 (1) 2 (1) 0(0) 0(0) 30 (11) 1 (1) 1 (1) 12 (4) 3(2) 12 (3) 1 (0) About Smart Growth Smart Growth Development is an lowa bi-partisan non-profit coalition which aMocates for policies promoting smart grow[h practices and historic rehabilitation. Our diverse membership indudes developers, municipalities, Main Street programs, Chambers of Commerce, architects, contractors, accountants, attomeys, preservation organizations, economic development groups, and more. Since 2009, Smart Growth has advocated for the continuation, grow[h, and accessibiliTy of financing programs that make your his[oric rehabilitation projects possible. SMARTGROWTH DEVELOPMENT About Heritage Works Heritage Works is a comprehensive resource for those engaged in preservation and redevelopment projects in the Dubuque region. It is focused on three primary objectives: facilitating collaboration for catalytic preservation and restoration projects, induding help in gathering financial assistance for such projects, communiTy and govemmental advocacy emphasizing the importance of historic preservation; and educational programming highlighting Dubuque's rich historic and architectural heritage. Heritage Works is a 501(c)(3) corporation. www.heritageworksdbq.com HERITAGE WORKS About Baker Tilly Baker Tilly Virchow Krause, LLP(Baker Tilly)is a nationally recognized,full-service accounting and advisory firm whose specialized professionals connect with dients and their businesses through refreshing candor and dear indus[ry insight.With approximately 2,700 employees across the United States, Baker Tilly is ranked as one of the 15 largest accounting and advisory firms in the country. Headquartered in Chicago, Baker Tilly is an independent member of Baker Tilly Intemational, a woddwide nelwork of independent accounting and business advisory firms in 141 countries, with 28,000 professionals. The combined woddwide revenue of independent member firms is 53.8 billion. � � � 2,700+staff A top ranked Part of a USfirm globalnehvork Connect with us: bakertilly.com �AKER�TILLY IN'fERNA'CIONAL MindependentmemberofBakerTillylnterrrafional Baker Tilly refers to Baker Tilly Virchow Krause, LLP, an independently owned and managed member of Baker Tilly Intemational. The information provided here is of a general nature and is not intended to address specific circumstances of arry individual or entit. In specific circumstances, the services of a professional should be sought. �20ll Baker Tilly Virchow Krause, LLP � :� .� 1 � �� `� ; .� � � � �� : � ,r�,� � � �3� .� �� - +�,� r ■ 1 ; ��,��_ a - __- _ -- -- .__ - - ._ __ � _ ; [ ; � � � � � - 1 1 � ��` r ��`� i=��* � 5 �k � • . . . . ' �'� � � ! :� �� • ��l� :'� �' • � � �' . al Y : � f h� � "h � � • .� f �' � �' ;�y: ' . .. —w . t_. . The report exhapolates across a universe of 117 commercial projects based on data sourced from 26 materially characteristic projects which received lowa State Historic Tax Credit Part III Historic certification from January 2011 to December 2013. Baker Tilly utilized the base data from the 26 sample projects to develop an extrapolated analysis and account for likely impacts on employment, economic ouqwt, taxes, and assessed property values across the universe of 117 commercial classified projects. Data was correlated by weighting the sampled projects proportionately by geography, project type and project QRE size. The 26 projects that were surveyed in depth comprised 56.6% of the $411.9 million of QREs ($103 million in lowa State Historic Tax Credits) under analysis and were sorted into four categories; Apartment (APT), Commercial (COM), Commercial+iotel (COM-H) and Mixed-Use (MIX). Based on this analysis the following high level data points are notable: • The 117 project universe is anticipated to yield a 5.04:1 return on investrnent by year 3, ramping upward to 19.7:1 in year 10, and to 32.1:1 by year 15, based on direct economic outputs alone. • Over 6,000 ConsVuction jobs and roughly 4,600 permanent full time positions are projected to have been generated by these investrnents. • M increase in assessed valuations of over 284% for these properties. �uring this same perioQ 152project sites recei✓ed la✓✓a State H7Cs and had more than$447.8 million in QREs.InGuded in this total are 35 projects that were agricuttural, nonprofiynorvreuenueprWucing,or wue single familyresidential in nature which were e�Guded from this analysis. �� _— _ .—.. � � , . -__. . ..-J� �' y� L . �y7�,;}1rJr � �r�l��_ �• �. 1. �Vi��i��it.. �� . Return on Invesment In looking at the overall return on investment, these projects provide economic output returns during construction and through their placed in service dates, prior to claiming the lowa HTC. Looking at the first anticipated stabilized year, or year 3 it is projected that the projects will yield $5.04:$1.00. This yield increases to $19.68:$1.00 by year 10, and ramps upward to $32.1:$1.00 by year 15. This return is calculated on the economic output projections and is therefore fairly conservative. A projected increase in direct operational wages of $191 million should trend upward over time, and is likely to increase R01 to the state of lowa and local communities, as will the inclusion of property tax values—making the projected return on investment calculation provided significantly conservative. Direct Economic Output ROI of Iowa HTC Projects $3500,000,000 $300,000,000 � $328,100,000 Szso,000,000 $519,100,000 Szoo,000,000 $919,461,900 Siso,000,000 �. $2,026,536,185 Sioo,000,000 $3,311,097,976 Sso,000,000 So Constmction 3 4 5 6 7 8 9 10 11 12 13 14 15 Year Overall,the 117 lowa HTC projects had more than $411.9 million in eligible lowa QREs with anticipated tax credits claimed post construction of up to $103 million. These same projects yielded more than $8.2 million in state and local construction taxes, more than $18.4 million annually in direct state and local taxes from operations, and they are estimated to have created more than $86.8 million in new assessed property value, or an increase of 284%. Assessed Value Increase by Project Location 5�,�8�,103 � $3,154,022 $35,704,503 $18,838,519 $15,245,687 $4,828,598 S Additionally, more than 10,700 jobs are estimated to have been created through construction and operations, and more than $559 million in economic output is estimated to have been created from project construction periods and the first year of annual operations. Summary of Estimate Total Impacts of Iowa HTC Projects (Direct,Indirect,Induced),by Projut'I�pe $130,777,927 2,222 $4,392,005 $172,944,535 3,194 $16,463,144 $46,510,697 764 $1,427,238 $1,724,154 117 $665,416 $118,615,744 2,340 $3,943,063 $27,097,445 1,215 $4,220,573 . � � • �. . �nvr as.csss�� API'$59859899� MLY 9]9.W6968� � �comas�z�szso � GrandTotal: $184,308,043 com-x aznsnw� Eatimated � EstimatedAvvval Couatructiou Divect Labo�Ivcome Labov Iucom� t�om mmoeeae�,, 69�ofedT9Pe 69P�ofenType � `COM-H9438886D �COM914f.8f8D2 M��"�91961� Grand Total: $31A,872,775