HomeMy WebLinkAboutCouncil Presentation 11-19-2019 - Villages of Tortolita CFD ApplicationVILLAGES OF TORTOLITA CFD APPLICATION
NOVEMBER 19, 2019
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COUNCIL CFD POLICY & LEGAL REQUIREMENTS
–Council adopted the current CFD policy on June 4, 2019
–Policy complies with Arizona law (A.R.S. §48-702 paragraph B) which
requires the Town Council to hold a public hearing on the application within
60 days after submission of a completed application
–During the public hearing Council may:
•Adopt resolution declaring intention to form a CFD
•Provide written basis for not adopting a resolution
–Submission of an application does not create a presumption of district
formation
–On October 1, 2019 TMR Investors, LLC submitted an application for the
formation of the Villages of Tortolita CFD
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PROPOSED CFD SUMMARY
Summary
•Number of Acres 1,520
•Number of Planned Residential Units 5,664
•Average Home Price $260,000
•Planned Build Out Period 15 years
Project Costs
•Estimated Total Costs $278 million
•Estimated Eligible CFD Costs $132 million
•Estimated CFD Costs per Home $23,313
Financing & Taxes
•Requested Tax Rate (per $100 assessed val.)
•Special Assessment Lien per Lot
$4.55
$6,500
•Annual Tax per home at Time of Purchase $1,225
•General Obligation Bond Authorization $180 million
•Special Assessment Bond Total $36.8 million 3
INFRASTRUCTURE
Project Buildout in 5 Phases
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Project Description (in millions)SA GO GO/SA Grand Total
I-10 Interchange 16.9$ 16.9$
Roads 15.1$ 15.1$
Wells, Lift Station, tanks, piping, etc.26.1$ 26.1$
Landscaping 10.2$ 10.2$
Drainage Channels 3.2$ 3.2$
Contingency 7.3$ 7.3$
Recreational Amenities 10.9$ 10.9$
Wastewater Treatment Plant 30.6$ 30.6$
All Other 11.7$ 11.7$
Grand Total 32.0$ 46.8$ 53.2$ 132.0$
Project Buildout in 5
Phases
First Debt issuance
requested for 2nd quarter
of 2020
All Other includes:
•Fees, Engineering
•Land Planning
•Removals & Abandonments
•Soils & Compaction Testing
•Concrete
•Street Lighting
•Walls and Monuments
•Sales tax
•Clean up
APPLICATION REVIEW
–Staff reviewed the submitted application for completeness and determined
multiple required elements were not complete
–A letter was sent to the Applicant specifying all deficiencies and concerns,
informing the applicant that submission is not complete
–Applicant is working to address some of the identified deficiencies
–Several deficiencies remain unresolved as the client is not willing to
address them
–Revised application not yet submitted to the Town
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CONCERNS & MISSING ELEMENTS
ELEMENT POLICY SUBMITTED APPLICATION
Insurance Explain how insurance for outside
Board Members will be provided and
maintained –Sec 2.9
Insurance proposal lacks adequate
coverage and required securities rider
exposing CFD board members
Other requirements like financial
capacity, absorption analysis,
marketing plan, etc.
Required by policy Unable to determine applicant’s ability
to complete project and protect future
homeowners
Value to lien ratios for special
assessment bonds
Extraordinary public infrastructure 4:1
all others 6:1 –Sec 4.6(g)(i)(1)
Requesting ratios of 4-1 or lower for
extraordinary infrastructure
Tax rate CFD debt shall not impose an
unreasonable burden on future CFD
residents –Sec 4.3
Over $1,200 at time of purchase at
$4.55/$100, including $6,500 S.A.
Multiple S.A.’s requested per property
Debt issuance Allows for acquisition or construction
of public infrastructure
Construction adds regulatory risk to
CFD and homeowners; reduces
developer overall stake in project
CFD boundaries Analysis of appropriateness of CFD
boundaries -Sec 2.5(b)
Complicated reimbursement issues
with owners that are not part of CFD
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COUNCIL OPTIONS
1.Deny District formation -Council adoption of Letter sent to applicant on
October 30, 2019 as a the written basis for not adopting a resolution to form
the District at this time (Staff recommendation)
2.Approve application and form District -Waive policy required elements
and adopt a resolution to order and declare formation of an new CFD and
authorize the execution of related agreements
3.Applicant opts to continue public hearing -If the applicant waives the
60-day public hearing –Continue the public hearing on the formation of the
District to a future Council meeting, on a date to be determined by Council
tonight
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