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HomeMy WebLinkAboutCouncil Provided Information - 3/10/2026NWQ, LLC TAX INCREMENT REIMBURSEMENT Phase IV CRA BOARD OF DIRECTORS MEETING –FEBRUARY 10, 2026 MASTER PLAN AUGUST 2016 •Establishes the vision and land use plan for future development, from which subsequent zoning amendments were based. ZONING & OVERLAY DISTRICTS 2016 - 2018 •Establishes natural areas to protect sensitive lands and developable areas zoned as M1: Light Manufacturing. COMMUNITY REINVESTMENT AREA ESTABLISHED JANUARY 2018 •Enables the collection of tax increment to facilitate economic development and master plan implementation. •An interlocal agreement between Salt Lake City and the CRA establishes that the CRA collect 75% of tax increment for project area development activities over a 20-year term. The remaining 25% is retained by the City. MASTER DEVELOPMENT AGREEMENT JANUARY 2018 •The CRA and City entered into a Master Reimbursement and Development Agreement with NWQ, LLC. •The Agreement establishes “reimbursement qualified expenses” that are eligible for a tax increment reimbursement. NWQ TI REIMBURSEMENT POLICY AUGUST 2018 •Establishes the policies and procedures for evaluating and approving a Tax Increment Reimbursement Agreement. •Applications for a reimbursement of $1 million or more of tax increment shall be subject to a public benefits analysis completed by a third-party consultant NWQ TI REIMBURSEMENT AGREEMENT Phase I MAY 2020 NWQ TI REIMBURSEMENT AGREEMENT Phase II & III JUNE 2024 •The CRA and NWQ, LLC entered into a tax increment reimbursement agreement for Phase I with a maximum reimbursement of $28 million Phase II & III for a maximum reimbursement of $49 million. APPLICANT: NWQ, LLC PHASE IV: 25.1 total acres CRA PARTICIPATION: 70% TERM: 20 Years or the sum of the remaining collection years of the Project Area, whichever is less MAXIMUM REIMBURSEMENT: $1,544,202 ELIGIBLE EXPENSES: $6,412,487 •Systemwide Improvements: $4,407,511 Improvements that benefit the larger area within Phase IV •Project-Specific Improvements: $2,004,977 NWQ, LLC’s improvements specific to Phase IV of property development Note: NWQ, LLC may only receive a reimbursement after the improvements are developed and the property generates sufficient tax increment. Note: Annual reimbursements subject to verification of the actual costs incurred by NWQ, LLC. NWQ, LLC’s Phase 4 will include roadways, water and sewer improvements, soil remediation, building pad and insulated panels. •355,176 square feet of development •$63 million of private investment •$71 million of newly assessed value •309 jobs Source Moderate Scenario Value High Scenario Value Total City Tax Increment $2,611,041 City Portion (25%)$652,760 $735,334 CRA Portion (75%)$1,958,280 Note: Tax increment values are projections over the remaining 13 years of the Project Area term based on the Public Benefits Analysis completed by LRB Public Finance Advisors. Use %Moderate Scenario High Scenario Tax Increment Reimbursement 70%$1,370,796 $1,544,202 Affordable Housing 10%$195,828 $220,600 CRA Administration 10%$195,828 $220,600 Shared Costs 10%$195,828 $220,600 Total Uses of Tax Increment 100%$1,958,280 $2,206,003 Note: Tax increment uses are projections based on the Public Benefits Analysis completed by LRB Public Finance Advisors. •There are significant extraordinary infrastructure improvements in the NWQ area, including soil remediation, access to utilities and renewable energy investments. •Tax increment participation will assist with removing development impediments and the system-wide infrastructure investment will lead to substantial development within the remaining NWQ area. •The Development has the potential to create millions of new assessed value within an underutilized area that has generated very little tax revenue historically for the City. •The Development is projected to create over 309 new jobs. •“But for” the use of tax increment, this area will remain underutilized and vacant.