Fiscal Impact Analysis – City of Norwalk, Connecticut October 5, 2006 Prepared by:RKG Associates, Inc. Economic, Planning and Real Estate Consultants 277 Mast Road Durham, NH Fiscal Impact Analysis – Reed Putnam Urban Renewal Project

2 6/22/2016 Presentation Outline Project Scope and Approach Project Scope and Approach Methodology and Assumptions Methodology and Assumptions Net Annual Fiscal Impact Net Annual Fiscal Impact Summary Summary

3 6/22/2016 Project Scope and Approach Purpose – Evaluate the potential fiscal impacts to the City of Norwalk that may be expected to occur under different development scenarios at Reed Putnam parcels 1, 2 & 4 Purpose – Evaluate the potential fiscal impacts to the City of Norwalk that may be expected to occur under different development scenarios at Reed Putnam parcels 1, 2 & 4 Approach and Tasks Approach and Tasks  Compare the municipal costs of providing services to a development to the revenues generated by the proposed development Determine population, school-age children and employment Project revenues from new taxes, fees, etc. From projected growth, estimate public service costs Compare costs to revenues

4 6/22/2016 Methodology and Assumptions Scenario One:1,000,000 SF Office Space (Approved Plan)50,000 SF Retail Space Scenario One-A:1,000,000 SF Office Space (Tax Abatement)50,000 SF Retail Space (Assuming State of Connecticut Urban Jobs benefit - 40% abatement of property taxes for five years) Scenario Two:500,000 SF Office Space (Staff Recommendation)150,000 SF Retail Space 80,000 SF (130 Units) Hotel 300 Condominium Units (Mix of 1 and 2 Bedrooms) Scenario Three:485,000 Office Space (95/7 Proposal)225,000 SF Retail Space 80,000 SF (130 Units) Hotel 310 Condominium Units (Mix of 1 and 2 Bedrooms) Project built in phases (up to ten years) Project built in phases (up to ten years)  100,000 SF office space per year;  85,000 SF retail space per year;  150 condominium units per year Reduced to 60 per year (conservative market repositioning estimate)  Hotel absorbed in one year (in Year 10 upon completion of office development)

5 6/22/2016 Methodology Cont’d Rising costs of providing public services matched by comparable increase in revenues Rising costs of providing public services matched by comparable increase in revenues Per capita method used to allocate costs Per capita method used to allocate costs  Current costs best measure of future costs Municipal officials interviewed Municipal officials interviewed 6 sources of school-age children multipliers/methods 6 sources of school-age children multipliers/methods Constant dollars, tax rates, tax base distribution, etc. Constant dollars, tax rates, tax base distribution, etc. Property values derived from combination of: Property values derived from combination of:  Tax assessment data  Comparable properties  Recently completed market studies

6 6/22/2016 Net Annual Fiscal Impact All scenarios generate an annual fiscal benefit All scenarios generate an annual fiscal benefit  $4.3 million (Scenario 1 & 1A) to $5 million (Scenario 2 & 3)  NPV of Scenarios 2 & 3 at least $11 million more than 1 & 1A over 10 year period Impact does not include one-time permit/inspection fees Impact does not include one-time permit/inspection fees  $1.6 million (Scenario 1 & 1A)  $1.8 million (Scenario 2) and $1.9 million (Scenario 3) Could serve as (re)development catalyst for neighboring properties Could serve as (re)development catalyst for neighboring properties Caution in incentives for large-scale office development Caution in incentives for large-scale office development  Few “net new” office users in County  Adding more supply could depress current/future lease rates  No indication that incentive will provide marketing advantage to site

7 6/22/2016 Impact of Tax Abatement

8 6/22/2016 Cumulative Impact and NPV

9 6/22/2016 Summary All scenarios generate (comparable) annual fiscal benefit All scenarios generate (comparable) annual fiscal benefit Phasing schedule influence Phasing schedule influence NPV of Scenarios 2 & 3 higher than Scenarios 1 & 1A NPV of Scenarios 2 & 3 higher than Scenarios 1 & 1A Doesn’t include one-time fees Doesn’t include one-time fees All scenarios may influence neighboring (re)development All scenarios may influence neighboring (re)development Caution needed re: adding to office supply Caution needed re: adding to office supply Questions? Questions?