Date:_-=--:-~~.c....-- Submitted in ~ Committee Council File No: '9 -0lf0 6 Item No.: \..ft> ~: 9=A6'
Special District Pilot Projects: San Pedro I Wilmington Waterfront Vermont Transit Corridor West Santa Ana Branch Transit Corridor
May 28, 2019
Prepared By: Kosmont Companies • Kosmont is working with SCAG on several Tax Increment Financing (TIF) I value capture feasibility analyses in the SCAG region in support of the Regional Transportation Plan I Sustainable Communities Strategy (RTPISCS) and affordable housing objectives. • In reviewing projects, Kosmont used the following criteria (among others) to determine potential eligibility as a pilot project: 1. Project area has high potential for development/redevelopment within 5-10 years 2. Project area supports mixed-use/transit-oriented development and has such zoning 3. Transportation and related infrastructure will be catalytic for future development 4. Infrastructure provides communitywide and regional benefit 5. Potential funding capacity from property tax increment and complementary sources • The San Pedro and Wilmington Waterfront areas, Vermont Transit Corridor, and West Santa Ana Branch (WSAB) Transit Corridor meet these criteria.
• San Pedro I Wilmington preliminary analysis has been completed. Vermont Corridor and WSAB analyses are currently being initiated.
• This presentation provides background on proposed study areas and scopes of work. J1!l ------ko;hl~~ Tax Increment Financing Entitlement I CEQA Streamlining • Enhanced Infrastructure Financing District (EIFD) • Housing Sustainability Districts ~ SB 628 (2014), AB 313 (2015), AB 1568 (2017), (HSD) (AB 73- 2017) SB 1145 (2018), SB 961 (2018) ~ Tax increment from participating agencies used to • Workforce Housing & Opportunity fund local I regional infrastructure and housing Zones (WHOZ) (SB 540 - 2017) ~ No blight test needed . ~ Residential and mixed-use, ~ Sales tax increment eligible via Neighborhood lnfill advanced planning, zoning and Finance & Transit Improvements (NIFTI) Act CEQA streamlining, limited • Seaport Infrastructure Financing District (SIFD) discretion to deny/condition ~ Affordability requirements, ~ SB 63 (2015) potential incentives, prevailing ~ Similar to EIFD but relates to funding of port or harbor infrastructure wage requirement (effective 1/1/18) • Community Revitalization Investment Authority (CRIA) • SB 35 streamlining and other 2017 ~ AB 2 (2015), AB 2492 (2016) housing bills ... ~ Restores redevelopment authorities to disadvantaged communities ~ Income, crime, unemployment, disadvantaged community tests • Affordable Housing Authority (AHA) ~ AB 1598 (2017), AB 2035 (2018) ~ Tax increment for affordable & workforce housing
ko • Based on existing Infrastructure Financing District (IFD) law
• Enables tax increment financing for local/regional projects (purchase, construction, expansion, improvement, seismic retrofit, rehabilitation) - now includes maintenance
• District lifespan is 45 years to collect and spend property tax increment
• Any property with useful life of 15+ years & of communitywide significance
• Managed by newly created Public Financing Authority (led by city or county)- board of 5+ members, includes at least 2 public members
• Activities directed by PFA adopted Infrastructure Financing Plan (IFP)
• No public vote required to create District
• 55°/o landowner or registered voter election needed for tax increment bonds (legislation in progress to modify this requirement)
• No school district increment allowed
• Does not increase property taxes rJJI ------ko;~J!~ Water I Sewer I Storm Light I High Speed Rail Civic Infrastructure
Industrial Structures Aff. Housing I Mixed Use Transit Priority I RTP I SCS Projects
Parks & Open Space Childcare Facilities Brownfield Remediation •
kosmg.n.t~ .. 1. Atwater 2. Azusa Sae:r, . ntt. :-~~ Santa 0 0 Rosa• 3. Carson • 4. Duarte
5. El Monte San Francisco· 0 • 6. Grand Terrace San Jose 7. High Desert Corridor (7 jurisdictions) c 8. Huntington Park 9. Imperial County 10. Inglewood 11. La Verne 12. Long Beach 13. L.A. County (W. Carson Uninc.) 14. Ontario
15. Pittsburg S:Jn LUI:; :.lbispo Q 16. Placentia Nar,'cna/ Pr~serv~ 17. Redondo Beach Red markers are EIFDs/CR/As 1. 18. Rialto under evaluation 19. Richmond • 20. Riverside 21. Riverside County (Salton Sea Uninc.) 22. Sacramento County San Diego Otay Mesa 23. San Luis Obispo EIFD (approved) 24. San Jose 25. Santa Ana ::, ..... !:' • 26. Santa Fe Springs 0 -u ·--'- "~: i?w "·· ~ ·r::;-:.;k; ~· ·-- 27. Seaside Go !e
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Example Projects I Properties: • L.A. Waterfront • San Pedro Public Market • Alta Sea Campus Research Center • Harbor View House Adaptive Reuse • Rancho San Pedro • Wilmington Waterfront Promenade and Preliminary Study Area Town Square Park !..-_i
• Preliminary analysis for San Pedro I Wilmington complete, determined to be feasible- may be updated based on preferred district type
Source: California Department of Finance ko • Currently in initial data collection . phase ~A:IHA..MiUil~.&. .4 M!-l~t'\5.£; : ~~-...., . IEVUil.Y .: • Study area preliminarily focused in J'-DM .• 0.25 and 0.5 mile radii of alignment . Pl'CO :' .• • Study area expanded south to .VI\$i~ ' M.f.?ilt : South Bay Silver Line Pacific . Coast Highway Transitway Station JrlrH::Xo• : . II:WOIII ! ~.. :. ~i ~ : ;
. ,.,j .• .•.'' ' . IUJI !., r ~iHGJ !' . ! . .• N .• . .• M •tto$.1~tl.lt\o CIII1111T :' •••••••••• Hl,r ••••••••••••••••• '-Jill ••••••••••• • ~ v • ~ ~ .• . • • (; • • • • • e • " " 0 " t:S: • • u d: • 0~ • • • c: • • • • • • •l"' .:I • • • • 6TH • • • 7TH • ••••••••• Arts !District South I _II Existrng Metro Seorv tc~ & Station rl:jF • ~?r0"' ._ . • Mt!ll!'o SiltYe-r Lioo • &Statioo :RTJN LUTHER K!N•l JP. BL • iiiiiil • • R~ i o~~~a l Coonet.tDf • Iunder conslructionl 0 • '0 ::RNON AV a· •• ~ , : IJ' I" WSAB TransU Corridor Proj«t .. • • "'·~&··· · " • ~ • •• • z • - <)-• VISAB Corridor & statiocn • 0 •• • 1- V• •• 0.. • - ()-• A!te.-ra;;t i ~Hl' E: & sta tion •• :. n; FUtRENCE % • 0 • IAiameda UndergrO"u ndl •• • 0 • •• • • • • SLAUSOr~ • - o-• Allernatie G & st at ion • • !Downtown Transit Core) " •••., ...... • - Opfional aligmnent & station ,.. Source: Los Angeles County METRO (2019) ko;~~~t Property Tax Increment: • Minimum $0.15 City share (updated in 2019; can come from a mix of sources) 0 • City share contributed ~ County share contributed • County contributes less than 1 00°/o of its share Fiscal Analysis: Positive net impact to County General Fund 0 Board Priorities: Supports affordable housing, homeless prevention, workforce 0 development, or sustainability Regional and Community Significance: As related to Board priorities above, job 0 creation, blight removal, or improvements to regional transportation Affordable Housing: 20°/o of rental housing must be affordable 0 "But for ... " Test: Contribution of County property tax increment is necessary 0 precondition for targeted projects
Sample- Affected Taxing Entities in San Pedro Approximate Property Tax Capture City of Los Angeles -26°/o Los Angeles County -24o/o LA County Flood Control -0.7% LA County Fire -0.5°/o
Approximate allocations, post-ERAF, not including school-related taxing entities (not eligible) Sample tax rate areas (TRAs) 00014 and 0031 1 in San Pedro study area Source: Los Angeles County Auditor-Controller ../ SB 5 (Beall, McGuire)- Local-State Sustainable Investment Incentive Program (State contribution via ERAF)
../ SB 128 (Beall)- EIFD bond issuance vote
../ AB 11 (Chiu et. al.) -Affordable Housing and Infrastructure Agency (new district)
------kos. • Preliminary analysis for San Pedro I Wilmington complete, determined to be feasible - may be updated based on preferred district type
• Vermont Corridor and WSAB currently being initiated, will evaluate: 1) Preferred district type (EIFD vs. CRIA) 2) District boundary alternatives 3) Major planned I proposed projects 4) Infrastructure improvements to be funded 5) Tax increment funding capacity I complementary sources 6) County cooperation 7) Implementation strategy and roadmap
• SCAG I Kosmont will outreach to City staff regarding analysis assumptions
• Completion of draft analysis anticipated in September I October 2019 for Vermont Corridor and WSAB ------Ws~. The analyses, projections, assumptions, rates of return, and any examples presented herein are for illustrative purposes and are not a guarantee of actual and/or future results. Project pro forma and tax analyses are projections only. Actual results may differ from those expressed in this analysis.
Discussions or descriptions of potential financial tools that may be available to the City are included for informational purposes only and are not intended to be to be "advice" within the context of this Analysis.
Municipal Advisory activities are conducted through Kosmont Companies' affiliate, Kosmont Transaction Services, which is Registered as a Municipal Advisor with the SEC and MSRB.
------kos. Thank You I Questions?
Kosmont Companies 1601 N. Sepulveda Blvd., #382 Manhattan Beach, CA 90266 Telephone: (424) 297-1070 www.kosmont.com ------IDs~