Frequently Asked Questions 10/7 update ‘What provisions will there be for onsite parking? Since alarge portion of the property is in flood zone, the new buildings will have to be raised on piles or stiles, This wil allow for garage areas on the ground floos, which would beapproximately at current grade and provide enough parking space for the residential, hotel, andcondo portions of the complex. What about the stone wall? ‘The developerhas expressed thae the stone retaining wal will eemain largely intact. The final drawings will cell Has there been a traffic study? Ac this stage there has been no trafic study. When applying for permits trafic study will be required. Will light and noise pollution be addressed? Mr. Kinnecom has acknowledged the concerns of the immediate neighbors and pledged that his design team will besensitive to sound and light. Ie should be noted that although there will be a horel operation, the campus will be substantially residential so these considerations will concern the residents onsite as wel ‘Are there any drawings available? Now that Mr. Kinnecom has a basic agreement with the Town he can move forward with architectural and cenginering work. He has stated that in November or December he willbe able to publicly presenta final version of the project. Inthe mean time thisdrawingis from his website www.wickfordel.com, We'll post more drawings as they become available. Has the zone changed for the property? No. The Planning Commission will ake up proposed zoning changes soon, This project is expected to be a game changer for Wickford ~ why? ‘Wickford El will help restore vitality to Wickfoed Village, stabilize its economy, and ensure its Future. The hotel and residences will ereate an anchor for year-round new economic activity. Wickford’s prominence as a regional arts center and destination will be advertised regularly chrough hotel operations Wickford El's sewer assessmene will make sewer service affordable in the low-lying land-strapped village where ie is most needed. Nearby properties and businesses will ineease in valueHow does this project affect Wickford’s sewer prospects? ‘The sewer proposals for Wickfordwere enabled by the hotel project chat fell through last year. That project included 37 roomsand would have contributed approximately 2 million dollars to the sewer installation, ‘The Wickford El project would add substantially more rooms and therefore be responsible fora greater portion of che sewer'stotal cost. The cost share borne by the village businesses would therefore be substantially ceduced. Although the exact costs can’t be determined until plans are finalized for both ickford El and sewer construction, it isclear that without a robust housingbased development at ford El the cose of sewers in Wickford would be prohibitive. Why does Wickford El matter to North Kingstown? Redeveloping Wickford Elementary School will add value to the town of Noreh Kingstown asa whole in terms of attracting business and visitors, generating employment, improving transportation, and preserving valued historic asset. Wickford El will add amenities not currently available in North Kingstown= a premier hotel, restaurants, conference facilities, and more. North Kingstown will gain national recognition asan ideal location for events, small conventions, and corporate and spiritual retreats nestled in quaint and authentic surroundings.By its scale the project will attract new private investmentto the community. Hundeeds of temporary construction jobs and the equivalent of about 40 full ime permanent jobs will be created, Transportation links from the railway station, airport, and Newport will be added at no cost to the taxpayer: Above all,ahistoric landmark will be preserved. Will the project help North Kingstown's finances? “The projece will transform a public liabiliy chae generates no income into a valuable $40 million taxable ‘campus thar generates a steady stream of property and hotel tax revenues for North Kingstown Ie also adds licele demand for town servicesand has no impact on the school budget. ‘What about the Olde Mecting House and playground? ‘The parcel of land along Boone Street is not part of the Wickford El project. The Mecting House will be on its foundation and fully restored using preservation grants. There is money already secured for the Heritage Park playground on that parcel as well. Wickford El will be landscaped toembrace the park. Is it clear that there are no alternative commercial uses for this property? ‘There appear to be no alternative commercial uses for the Wickford El property that would preserve the school building as historic aset. The property has been in the market since NorthKingstown voters in 2011 authorized he town to sel it, bu there has been litele interest. The building cannot be occupied for any use in its current state. A project proposed in 2014 to renovate the property asa hotel stalled as state tax credit neededto bring it co buildable condition appeared elusive. The Wickford El proposal to which the town has agreed is one of only two rec fed in response to the town’s request for proposals issued in ‘Occober 2014. The other proposal, for an assisted living facility, was withdrawn. There probably would be considerable demand for the property ifthe school were demolished, bue ie is unclear what the total benefits to Wickford and the town would be under this scenario.Whyis the sale price a fraction of its value? ‘The market value of the property ies entirely in the land, five acres of rolling waterfront terrain within walking distance to Wickford village. The land’s value according to the tax rolls is $360,000. In comparison the land value of che 12.5 acres occupied by the Wickford Middle School is I million, But the school building reduces the market value of the property. In is present condition the building cannot be occupied for any use. Due in part to its histori status, renovation or removal becomes problematic and the cost is Aifficul to justify on a business basis, So whether or not the agreed upon price of $500,000 is fair or not is debatable. In the end, a property's value is whatever someone is willing to pay for it. Moreover, the sae is, conditional on progress in preparing development project worth $40 million including payments to the own several times the sale price. Why does the project have to be so big? ‘The economic value of the project needs to be large enough to support the operationsthae the developer has envisioned. There isa minimum scale below which the project is not viable as a business. As a seasoned developer and hotelier he must decide what size will work. In addition the total value of the marketable properties included in the projece needs to generate enough new property taxes to service the TIF bonds. ‘This balance will be proposed by the developer and evaluated by experts of behalf ofthe town. As for the physical size of the project, the preliminary architectural design shows building heights similar to those of the existing school, which should not materially affece the views from Wickford. The developer is keenly aware ofthe need to preserve the visual appeal ofthe village and its surroundings.Tax Increment Financing 10/7 update ‘What is tax increment financing (TIF)? ‘TIF is financial inserumene widely used by US municipalities to partner with private projects of public interest. The municipality borrows money to help pay for investments that willhelp generate new tax revenue, and pledges to use this future tax revenue to repay the debt. TIF is used when investments needed by the community would not be financially viable on their own, such as to redevelop a blighted area or enable new investment benefiting the community at large. Should we be concerned about TIF's? “Tax inecement financing (TIF) isa key component of this plan. Without TIF, preserving the school buildingmay not be a viable business. TIFs are simple to conceive but their specific application can be complex. The answers to this question will evolve as the particulars ofthe plan do, Ac this time there aren't ‘exact answers bue we can explore TIFs and how they may apply. ‘When will the developer be applying for the TIF and is it subject to voter approval? Agreement between the town and the developer on a plan to issue and disburse tax incremental financing (TIF) municipal revenue bonds isa condition ofthe sale and subsequent development of Wickford El. State law does not require municipal revenue bonds to be approved by voters, be the Town Council has decided chat fll disclosure and understanding i in order. The public will therefore have every opportunity tostay informed and comment. Are TIFs tax breaks? No. The tax abatements available for development will be waived and the property wil be fully taxable to the extent ofits value from the time itis sold Ie is this new tax revenue, expected to approach I million dollars annually when the property is fally developed, that will be dedicated to repay the bonds, The town and taxpayers are not obligated to repay these bonds beyond the extent of che tax income generated by the project If the TIFs are agreed to isn’t 25 years excessive? ‘TIF bonds eypically have maturities of 20-25 years, bue successful projects often repay them in 15 years. ‘There are many market and performance variables that affect future tax revenues so analysts require revenue projections that exceed the amoune necessary to repay the bonds in 20 years. Proforma revenue projections to be prepared by the developer will be reviewd by TIF financing experts on behalf of the town. Why is TIF necessary? ‘The Wickford El projece would not be viable without TIF financing of about one-fourth of the total investment. The property would be worth more withoue the school that i the Focus of preservation. TIF financing is needed to offset this difference and redevelop the school ratherthan demolish it and build anew. Wickford Elementary School is vacant since 2005 and has become an eyesore and safety risk. In 2011 North Kingstown voters authorized the town to sel che school, bue there have been no takers. A hotel project proposed by adeveloper in 2014 stalled as state tax credie needed to bring the property to buildable condition appeared elusiveWhy did California close down TIEs? What are they doing now? ‘The state of California closed down the urban redevelopment program and it’s implementing agencies, not the use oftax increment financing (TIF). ‘The 60-year old program had successfully created and preserved jobs, boosted local economies, inereased taxes and other revenues to local governments, revitalized blightedareas, and produced affordable housing, ‘TIFs are a time-tested financing tool accepted by bond markets, and were by far the largest source of funding of this program, amounting to about 12 percent of toral property tax revenue statewide. Bur by state law50 percent ofall property taxes go directly to the school districts, so earmarking new taxes to finance development projects cut into school revenues. The state was requited to repay the school districts for every dollar they lost to TIE. A major state budget crisis made this arrangement unsustainable. Moreover, there was growing concern that the urban redevelopment program had overextended its each and used to aterace new shopping centers, sports facilities, and other high-profile projects well beyond the ‘original intent to revitalize blighted areas. ‘There was also concern about lack of transparency and complex procedures that had evolved during 60 years of legislation ‘The redevelopment program and agencies were terminated in 2012. But legislation enacted in 2014 set new rules and procedures for enhanced infrastructure financing by local governments. ‘The law provides that ‘TIF may be used to help finance public capital facilities or other specified projects of community wide significance. This includes streets eransit, parking, sewers, recreational facilities, libraries, child care facilities, affordable housing, and projects to implement sustainable community serategis, among others. Suggested reading: 1. Fulton, William: "Redevelopment Financing Gets an Overhaul in California", Governing che States and Localities, March 2011 hxp.//www governingcom/columns/ecosngines/coltedcselopmencfinancing gets overhaulin-alifoenia hia 2. ULL San Francisco District Council After Redevelopment — New Tools to Promote Economic Development and Build Sustainable Communities, November 2013 3, Peterson, Sarah Jo: "Tax Increment Financing; Tweaking TIF for the 21st Century’, URBANLAND, The Magazine of the Urban Land Insieue, June 9, 2014 hep.//urhanlnduliog/cconomymarkerstrends/exineromenefinancing tweaking riE2ls-ccntury 4, State of California: "SB-628 Enhanced infrastructare financing discricts(20132014)", enacted September 29, 2014 hp.//www govercecom/staelocal/2014/1/alfoniataxincremenefinancingtiaw/98771 ‘Whar is the effect of TIF on schools? In North Kingstown, ax increment financing (TIF) of Wickford El would have no directeffect on schools Funding of the School Department is allocated by the town through the budget process. Tax revenue from existing properties will continue to accrue entitely to the town, Tax revenue to repay TIF bonds will come only from new property value developed with TIF support. Indirectly, schools may gain as new Wickford El will generate litte or no new demand on schools, while the town’s eax base from which schools are funded will increase asthe value of nearby properties rise.