12/19/01 Waatti to Kukulski/Status of ProjectPEAK
DEVELOPMENT
8. PROPERTY MANAGEMENT
November 19, 2001
City Manager
City Council Members
City of Kalispell
312 — 1" Avenue East
Kalispell, Montana 59901
As our Southfield Park project is nearing completion, we'd like to bring you up to date on
the status of the project relative to our Developer's Agreement and to request Tax
Increment Funds to assist with our infrastructure expenditures.
As you may recall, our Developer's Agreement required some $125,000 in annual tax
revenue generated from a $6.2 million project. I'm happy to advise you that our project
is valued at $10 million and should generate nearly $200,000 in annual tax income to the
City. This means the City will realize $75,000 per year or $750,000 for ten years over
and above the anticipated revenue.
Other positive aspects of this project include:
® Enhances Hwy 93 South entrance into Kalispell with quality businesses that
provide needed services, products, and jobs.
® Provides jobs that support the economic viability of the community. We estimate
that Southfield Park tenants will employ more than 270 people, generating a
payroll of more than $4 million.
Because of the infrastructure investment we have made on this project, including
sidewalks and curbs, we request that you consider us for tax increment fund assistance.
Here is a summary of our infrastructure costs:
Infrastructure improvements $842,886
(includes sewer and storm drain systems and hook-ups)
New fire hydrant to meet City requirements 90,000
Total $932,886
We will be happy to provide additional information you may require and appreciate your
considering our request for TIF fund assistance.
Sincerely,
Matthew J. Waatti
Office Qo6) 756-PEAK(7325) Southfield Tower
Toll -Free 1-888-9o1-PEAK(7325) PO Box 1, 1830 3rd Ave. E., Suite 301
Fax (406) 2S7-6o12 Kalispell, MT 59903
11/19/2001
Southfield Park Developer's Agreement
City of Kalispell & Northwest Investments Partnership, LLP
1. Project Value to Generate Tax Revenue
Promised Per
Agreement Actual Added Value
$6,200,000 $10,000,000 $3,800,000
2. Annual Tax Revenue to City 125,000 200,000 $75,000
Over 10 years, some $750,000 tax revenue added
Developer Costs
Incurred to meet city requirements but without financial assistance from the City
1. Infrastructure Improvements ($4.50 per sq. ft.) $842,886
Includes sewer and storm drain systems and hook-ups
2. New Fire Hydrant -- Required by City $90,000
Total $932,886
Summary of Benefits to City of Kalispell and Community
1. Generates nearly $200,000 in annual tax revenue -- $75,000 more than would have been realized under
original Developer's Agreement.
2. Significantly enhances Hwy 93 South entrance into Kalispell with quality project and businesses that provide
needed services, products, and jobs.
3. Southfield Park tenants will employ some 270+ people -- 60% to 70% will be full-time -- generating a payroll
of more than $4 million.
Frugal`s
City Brew
Video Library
Plaza (est @1 per 500 sq. ft. x 2 shifts)
Forum (est @ 1 per 350 sq. ft.)
Southfield Tower (est.)
TOTAL
Part Time Full Time
10
22
6
6
5
5
16
36
27
64
10 65
74 198
Total
32
12
10
52
91
75
272
Total of 272 employees x $15,000 avg. salary = $4,080,000