Focus Area: Economy
Staff Contact: Jamie Robichaud / Kathryn Messer
Subject: Report on a request by Aspen Industrial Land Fund I, LLC and assigns for an issuance request for industrial revenue bonds and tax phase-in for a first phase project request in a business park with a master resolution. The first phase project will construct a 215,575 sf facility on a 12.87 acre parcel located near the northwest corner of 171st Street & Lone Elm Road.
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Report on a request by Aspen Industrial Land Fund I, LLC and assigns for an issuance request for industrial revenue bonds and tax phase-in for a first phase project request in a business park with a master resolution. The first phase project will construct a 215,575 sf facility on a 12.87 acre parcel located near the northwest corner of 171st Street & Lone Elm Road.Body
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Summary:
The City has received a master resolution and a first series application for industrial revenue bonds for the construction of industrial and warehouse facilities in a business park setting. The master resolution request $176,600,000 in industrial revenue bonds for the construction of 1.34 million square feet of space on 80.45 acres. This will be a multi-series of bonds to be issued to cover land, the building and furniture, fixtures and equipment costs for each series project. This development is located on the NWC of 171st Street and Lone Elm Road.
The Applicant requests a 10-year / 80% property tax phase-in in conjunction with the issuance of the City’s industrial revenue bonds for all phases of the development. This project is applying under the City’s tax abatement policy (Policy F-5, Resolution 25-1099).
The first series of bonds under the master resolution should not exceed $28.5 million in industrial revenue bonds for the construction of 215,575 square feet of commercial space on 12.87-acres of land. The first series request of industrial revenue bonds for the project consist of:
o $1,800,000 to acquire land
o $26,700,000 to construct the building
• The first-phase project will create 162 new jobs over the next 10 years.
o Average salaries of the new jobs:
§ $48,000 in year one, growing to $74,464 in year ten
o A total of approximately $92 million in new wages in year 10 of the abatement
• Property taxes over the 10-year period with estimated 80% property tax phase-in on the first phase project (excludes 8 mills for school district):
o All jurisdictions = $100,791 annually / $1,007,918 10-year total
o Olathe = $20,233 annually / $202,332 10-year total
o Olathe’s current annual property tax revenue from the property is $0 as this property was annexed into the City for the purpose of this projects development.
o Upon retirement of the tax phase-in, the City will receive approximately a total of $101,166 in annual property tax revenue once the property tax phase-in expires.
The cost-benefit ratio of this project for the City is .64 with payback expected to take more than 10 years.
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Financial Information:
See attached materials for more detailed fiscal impact information.
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Action Needed:
Accept report. A public hearing and resolution regarding the project will go before the City Council at its May 5th meeting.
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Attachment(s):
A. Executive Summary
B. Application - Master Resolution & First Phase
C. Firm Data Sheet
D. Project Cost Benefit Analysis
E. Site Aerial
F. Resolution No. 26-XXXX