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Council Meeting Minutes August 24, 1993 Page 4 Council Business. continued Jim Casserly, City financial consultant, said both developers have proposed the same land price. Accurate proposes a $25,000 payment at the time of the development agreement execution, $25,000 at closing, and the balance over 7 years. In comparison, the Greenhaven project is a cash sale and because they could begin operations sooner, they would generate $17,000 in tax increment the first year. However, Accurate is a larger project and would generate an additional $17,000 in tax increment every year. These figures do not take into consideration Greenhaven's future expansion. In final, Accurate would generate a larger tax increment. Jim Winkels, Belair, finds it difficult to make comparisons of these two projects. Greenhaven is a quality publishing firm headquartered in San Diego which is in a growth curve and proposes an expansion in about 3 to 4 years. They intend to build a quality building at Brighton Corporate Park. Winkels said both companies proposed a land price of $1.25/sq. ft., however, there is a value difference between Greenhaven's cash proposal and Accurate's seven year financing plan. Because Greenhaven proposes a 23,000 sq. ft. facility and future expansion to 40,000 sq. ft., he feels the project's value would total more than $935,000. Greenhaven could stipulate to the County Assessor to enter into tax records the entire building value on January 2, 1994. This would guarantee the City a minimum of one year full valuation. The Greenhaven project is a risk-free, cash payment project, and proposes construction to begin this October. He questioned whether Accurate would be able to receive Small Business Administration financing. He is willing to help the City locate a site for Accurate because the City would benefit by retaining both quality projects. Benke asked Winkels if he feels the estimated $695,000 value for the project is incorrect. Winkels feels the valuation prepared by the Assessor is inaccurate because the project plans were not reviewed. Without the expansion, the project's value would be in excess of $900,000. Winkels presented a colored rendering of the proposed Greenhaven facility. The building would be designed as such to accommodate for a future expansion on building's north end. Gunderman noted the easterly location of the Computerized Mailing Services (CMS) facility, and asked for clarification of it's view of the Greenhaven project. Winkels said CMS would view the facility's backside which is constructed of the same materials used on the facade. The expansion would be constructed towards the U.S. Tire building. Gunderman asked what the building's eastside entails. Winkels said the building's eastside includes two loading docks and one overhead door. Locke said a comparison of the two projects is difficult. The Assessor's calculations were determined from a 23,000 sq. ft. building, however, Greenhaven may invest $900,000 to build that facility. The City or property owner has very little influence over a valuation amount, because the Assessor sets 8 value which they feel is appropriate. Council Business I Northco and Belair Development Proposals for Lot 1, Brighton Corporate Park Report 93-229 Report 93-230 I I