CRA’s and Tax Increment Financing (TIF) Why Timing is so Critical?

What is Tax Increment Financing? Tax Increment Financing (TIF) is the funding mechanism used to provide money for redevelopment within the CRA. It allows for redistribution of tax revenues generated from the targeted area. o Ad valorem property values are frozen at base year for the area and tax revenues due to an increase in property value in excess of the base year (up to 95%) go into a CRA trust fund. Property “A” Base Year 2007 $10,000 value City and County Receive $11.12 Current Year 2015 $15,000 value City and County Receive $11.40 Redevelopment Trust Fund Receives $5.32 (95%) Example:

What can TIF $ be spent on? o Administrative + Overhead to Carry Out the Adopted Plan o Planning, Surveys, and Financial Analysis o Reimbursement for start-up costs o Acquisition of real property within the CRA o Clearance + Site Preparation o Repayment of loans, advances, bonds, bond anticipation notes, and other debt o Cost of issuance, sale, redemption, retirement or purchase of agency bonds o Affordable housing within the area o Community policing innovations (Code Enforcement activities) Anything in the Plan or Finding of Necessity, AND within the adopted boundaries

TIF $ CANNOT be spent on… *Trust fund money for any project, program, donation, sponsorship, grant that is not expended in the CRA and not clearly in the redevelopment plan. * o Construction or expansion of administrative buildings for public bodies or police + fire, unless each taxing authority agrees to such method of financing for construction or unless the improvement is part of a community policing innovation. o Projects under any previously existing CIP or non-CRA funding plan until they are off that list for 3 years o General government operating expenses unrelated to planning and carrying out of the CRA plan

Where has $ been spent in the Amelia River Waterfront CRA? Using seed money from the City’s general fund ($450, 000) provided in 2008 and revenues from the CRA in years ( ) dollars have been spent on the following items. o Construction of Sun Shelters + Utility Enclosure o Landscaping + Irrigation o ADA Parking; and Professional Services such as: o Design and Engineering o Surveying o Geotechnical Data + Analysis o Title Research o Lobbying

Fernandina Beach Amelia River Waterfront CRA Financial Summary

CRA Property Values Total City 2005 Base yearTaxable value inTax IncrementFinal taxable value Tax increment areaValue (DR-420 TIF)DR 422 (DR-420TIF) ,665,7281,847,029, ,665,72814,995,2181,329,4902,042,725, ,665,72816,263,6722,597,9442,046,550, ,665,72815,456,0471,790,3191,890,839, ,901,08512,585,675-1,315,4101,709,450, ,901,08511,913,688-1,987,3971,636,799,250 CRA Account Revenue

CRA Advisory Board Recommendation 1.Reset the CRA Base Year to 2013 Take advantage of the low property values and remove the burden of inflated values 2.Extend the Term of the CRA to 40 years Provides a longer period of time to make improvements The City can sunset the CRA earlier should the Plan be completed earlier. Allows time to consider bonds for improvements The City Commission is anticipated to make a decision in June 2013.