Granite State Business ParkProject of the Year 2012

TIF District Case StudySeacoast Leadership Economic Development Day

May 1, 2013

Business Park Development 1989

Howard Katz, Developer– Phase 1 – 97 Ac– Phase 2 – 55 Ac– No Access to Phase 2

• Off to a Great Start!– Prime Tanning 1994– Salmon Falls Precision

1994– Techniweave 1999– Frisbie Hospital Secure

Storage 1999• Pease International

Tradeport 1992

Granite State Business Park 2010

• 62.2% of Phase 1 is developed

• 421,500 sq ft/ 5bldg• 425 Employees• Assessed for Taxes

$15,740,000• Payroll $19 MM

• Manufacturing Changes – Prime Tanning closed,

Rand-Whitney Corp. – Salmon Falls Precision

closed, Multi-Tenant– Techniweave acquired

by Albany International, bldg expansion in 2007

– Industrial Condos 2006 & 2009

• Still owned by same developer

Aerial View

Local Economic Challenges

• Great Recession• Thompson Center

Arms announces relocation to MA – INCENTIVES!

• Lack of available Capital, increased underwriting standards

• Lots of available real estate – CHEAP!

• Transition in required mfg skills

• Existing Companies with Unique Products– Advanced

Manufacturing– Composite Materials

• Developer willing to sell @ discount

• Expansion opportunities

TIF District & Program Plan

Financing & Development Program Plan:• Defines district, budget, use of funds, etc.• Adopt by public hearing. See RSA 162-K:6 and 162-

K:9.

Plans must “contain a complete statement as to the public facilities to be constructed, the open space to be created, the environmental controls to be applied, the proposed reuse of private property, and the proposed operations of the district after the capital improvements within the district have been completed.”

Important Features! Multiple TIF Districts are

allowed, HOWEVER:• Do not exceed 8% of

Assessed Value for community (or

• 16% for all combined with districts that have outstanding bonds);

OR,• 5% of total acreage! (or

10% of total acreage for bonds outstanding)

• Increment only accrues after date district is established!

• Values as of April 1.• Bonds – First payment

must be within 5 years.• Last payment no later

than 30 years.• Bonds are NOT to be

included when computing the municipality's net debt under RSA 33.

TIF ExamplePre-construction or “Original” value = $1,000,000Post Construction Value = $50,000,000• Increment or “Captured Value” = $49,000,000• Tax revenue on $1,000,000 “Original” value =• $25,000 ($25 / $1,000 A.V. Tax Rate)• Tax revenue on increment = $1,225,000• $25,000 to General Fund• $1,225,000 to TIF for debt service, operating

costs, maintenance & reserves. Increment Value is based on April 1st each year

Critical Deal Components• Internationally

Competitive RFPs• Two Partners• Incentives - on-site and

off-site +$9 M– “blighted” location– RSA 205 never used

• City investment in BIG infrastructure +$5 Million– Access to Site– Wetland mitigation

package– Utilities, relocation of PSNH

transmission lines• Critical Timing of

Construction

• Collaborative Partnerships– City Staff & Elected Officials– DRED, DES (EPA, Army

Corp)– Governor Lynch– NH Northcoast RR– PSNH, Unitil, FairPoint

• Labor availability & cost– Skills shortfall

• Training program for 20+ years worth of employees– Great Bay Community

College– Creteau Technology Center– Advanced programs

• $4 M NH, $19.9 M US

Safran/Albany LEAP Facility

This Albany & Safran project will create:– 689 FT jobs– $41MM Annual

Payroll– 911 indirect jobs– $27.5MM Payroll– Total Economic

Output (NH) $232,781,044

Tax Increment pledged for ~15 years to debt service of $9 MM

343,000 ft2 facility + 90,000 ft2 exp$100MM CAPEX55 acres under agreement for exp

Granite State Business Park 2013

• Expanded to 252 ac• Development District

– +$5M Infrastructure• Incentives

– TIF District – ERZ Tax Credits (NH)– R&D Tax Credit (NH)– FTZ (US)

• Anticipated Development– 50 Acres Under Agr.– Lot #1 Sold – Jan 2013– Lot #33, 34, 35 Avail. – 102 Add’l Acres under

Investigation

2003 Value $5,128,800 330,865 ft2

2012 Curr Value $14,712,207 +186.854% inc 423,666 ft2 Revenue $359,689

2030 Est. Value $34,740,000 +236.13% inc. 1,596,900 ft2 Revenue $892,223

“If it’s happening in NH, it’s happening in Rochester!”

- Economic Development- Planning, Zoning

- Code Enforcement- Building Safety

@RochesterEDCwww.thinkrochester.biz

Karen Pollard, CEcD, EDPDeputy City Manager/Director

Community Development Division

Karen.pollard@rochesternh.net