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RES 2014-1073 - 40 Harney-Farnam TIF redevelopment project pln A ��0l�Eg�s� REaEIvFa PlanningDepartment v e r v Omaha/Douglas Civic Center �'� Cr.` qq b 1819 Farnam Street,Suite 1100 x �� I� 2Oi' AUG 14 PM 2= 06 Omaha,Nebraska 68183 '= (402)444-5150 op A Telefax(402)444-6140 'TFD FEBR CITY CLERK James R.Thele City of Omaha ©M A H A, N E B R A S K A Director Jean Stothert,Mayor August 26, 2014 Honorable President and Members of the City Council, The attached Resolution transmits the 40 Harney-Farnam Tax Increment Financing (TIF) Redevelopment Project Plan, which is located southwest of 40th and Farnam Streets. The redevelopment project plan contemplates the rehabilitation of the commercial structure located at 4001 Farnam Street, and restoring the multi-family structure located at 4004 Harney Street to its original number of 6 units from the current 12 units. These will be 3-bedroom units. The Planning Board recommended the approval of this redevelopment project plan at the August 6, 2014 public hearing. The Redevelopment Project Plan recommends the City's participation in the redevelopment of this project site through the allocation of TIF in an amount up to $184,500.00 to offset TIF eligible costs such as acquisition, rehabilitation costs, landscape sidewalk repair, architectural and engineering fees, and any public improvements as may be necessary, which includes $15,000.00 of the TIF proceeds/loan toward the Midtown Public Improvement Fund to be used for the Farnam Street two-way conversion. The total estimated project costs are $2,234,150.00, but are subject to change as final costs come in. Your favorable consideration of this Resolution will be appreciated. Respectfully submitted, Referred to City Council for Consideration: j sl /zl,y � � �s / t-› j tY mes R. Thele Date Mayor's Office Date Planning Director IP Approved: J 3 f (71,1 './3 -,5 Steph . Curtissl ate Robert G. Stubbe, P.E. Date Finance Director Public Works Director 2064 dlh Notice of Publication and Public Hearing: August 28, 2014 and September 4, 2014 Public Hearing: September 16, 2014 ..--* LEGAL DESCRIPTION PROJECT LEGEND 7 7 7 . uuranau m PARCEL 2: SOUTH 82 FEET OF LOTS 1, 2 ANO 3, BLOCK 15, cns .,•p LOCATION • PROPERTY CORNER FOUND WATER MANHOLE HIGHLAND PLACE, AN ADDITION TO THE CITY OF OMAHA, AS SURVEYED, PLATTED AND RECORDED IN DOUGLAS COUNTY, °+O0 a " " PROPERTY CORNER SET NW WATER VALVE NEBRASKA. l ' s a a F ,9°'"°"' " TEMPORARY POINT NG GAS VALVE CERTIFICATION f-?O(�ir -i(oIiIY.-� dam; R R RECORD DISTANCE BOLLARD TO & jU(v(yf1)(J ace x 9 M MEASURED DISTANCE FFE FINISHED FLOOR ELEVATION COMPANY,4001 FAANAM EEC, A NEBRASKA LIMITED LIABILITY eaa 1 I PAS SIGNAL POLE ---w--- WATER LINE mamw°n,a."ease°s e°rnar,inc. ea ---0--- GAS LINE DUNDEE BANK, BRANCH OF SECURITY STATE BANK, 10a38CM MORN 6,r' 00000 """""' PA POWER POLE Omaha.NEBa159 _ a� 0 PAb° POWER POLE WITH UNDERGROUND DROP --Ou- - OVERHEAD UTILITY LINE M.G. REAL ESTATE PROPERTIES, L.L.C. F.aW320.88E0(402.330.538e e2w.wm ,°„ea Ea IFY PAL/°0 POWER POLE WITH LIGHT AND UNDERGROUND DROP ---urv--- UNDERGROUND CABLE TV LINE suns),'roe •G a OLD REPUBLIC NATIONAL TITLE INSURANCE COMPANY e»T� "" .- GUY WIRE --u1--- UNDERGROUND TELEPHONE LINE AND $,A,a°,._f. GI " u R a + ® CABLE TV PEDESTAL -- CONCRETE WALL ALTA/AGSM LAND .+dlxu 11 MISSOURI RIVER TITLE , VE ELECTRIC METER ROOF DRAIN TITLE SURVEY c CONCRETE CURB STOP=; THIS IS TO CERTIFY THAT THIS MAP OR PLAT AND THE s aacn VG GAS METER SURVEY ON WHICH IT IS BASED WERE MADE IN ACCORDANCE 4004 HARNEY SIGN CJW WINDOW WELL WITH THE 2011 MINIMUM STANDARD DETAIL REQUIREMENTS STREET ED SEWER MANHOLE 140021 ADDRESS FOR ALTA/ACSM LAND TITLE SURVEYS, JOINTLY ESTABLISHED AND ADOPTED BY ALTA AND NSPS,AND INCLUDES ITEMS 1, VICINITY MAP ® TELEPHONE MANHOLE 2, 3, 4, 5, 6(b), 7(0)(b), 8, 9, 10 AND 11(6) OF TABLE A THEREOF. THE FIELD WORK WAS COMPLETED ON JUNE 24, 2014. ow /P�NE6RA$p4 cue„,°.m. / : Ls.-so7 + ; THE LUND COMPANY JUNE 24, 2014 -.♦+i P1 / 1 I I BLOCK 15. HIGHLAND PLACE 66.00' DATE CHRIS E. DORNER �.+ LOT 3 'i BENCHMARK NEBRASKA RLS #507 PART OF ILOT 2 LOT 1 PART OF PART O1 I DESCRIPTION: THE RIM OF THE SEWER MANHOLE IN THE Y z o -"12°o CENTERLINE INTERSECTION OF 41ST STREET AND HARNEY PK NAIL r -V-4 e. STREET. 194 CONCRETE I BUILDING WAF.E.E 2 6208 , 6G�-_A �120B1 w NOTES ELEVATION: 1187.55 (NAVD 1988) PART OF LOTS 1-3, >NSB oiaiiaoair ra giavv//oira(ai,miiiiii/ riiiii roaiaii rill rmii ail_000iooiiq,/!mn g BLOCK 15,HIGHLAND ' "C _ + • : 1V-0�� -'.1- _ a I PHYSICAL ITEMS DESCRIBED IN THE LEGEND ARE NOT DRAWN PLACE,DOUGLAS WITNESS CORNER � .C C C C C r 7. 1 J,C C•/ C C C - I�'�-1z06'-0U- a TO SCALE FOR THE SAKE OF CLARITY AND ARE SUBJECT TO COUNTY,NEBRASKA. 5.0 WEST OF CORNER J,' Bg-• a / / 133.00 R 'I 11 y+ ANY SUBSEQUENT INACCURACIES. PK NAIL W WASHER #308 AO 134.05'M I p I' I ` g / _1196" 3'0¢„ �' J / ^3 13 I Y` Li n S C CONCRETE ,/ ,�j \O do' ASPHALT 1 6 ¢ p- "_"+2°1 1 os 2. THE PROPERTY LIES WITHIN A DESIGNATED ZONE "X" (AREAS y / dtio� b G m o p3 r 0. DETERMINED TO BE OUTSIDE THE 0.2%ANNUAL CHANCE/ \ IN 1 1- i v FLOODPLAIN) PER THE DOUGLAS COUNTY, NEBRASKA AND LOT 1191 � 14 SPACES Jp/ 1 IIIi1m�ZOB �,I{i.i INCORPORATED AREAS FLOOD INSURANCE RATE MAP NUMBER BLOCK 415 E 8 .0. 0" / // ,-'/ I I f I log I! Ir ht"'`12p8 ; 31055CO23811 DATED DECEMBER 2, 2005. HIGHLAND o m oC o / C C C Co 6- C\ C ,O" CC C Co I i 31.0' m _ PLACE Z' ." !'� ;�' �' I� o,o I -3 4 I 3. THE PROPERTY CONTAINS 10,999 SQUARE FEET OR 0.25 oo : . '0 s0 - _1209 p 209 ACRES MORE OR LESS. _ 7.2' 7.2' 7.2' :7.2' .. %1]5'%/ R 1 "1 '1198. //,� f/.o /'ao, %'"o,� 1�01 x I Q 4. THE PROPERTY IS ZONED GC-ACI-1(PL), (GENERAL y •ta s' eta.] •ue' to]' -tzs•., i J _ N WOOD r 7210 3: COMMERCIAL DISTRICT) PER THE DOUGLAS COUNTY GIS BUILDING LINE F.F.E.-1202.48 F.F.E:1202.37 F.F.E.-1213.93 - 4.5 'PECK 13 1210 i- WEBSITE htt /www.dc s.or do s - THIS ZONING HAS 0 10 m t "� ( P:/ 91 9/ 91/) IS ON PROPERTY LINE 'r' F.F.E.d210.04 F.F.E.-1209.93 F.F.E.=1206.43 ® �1,,�p W I THE FOLLOWING MINIMUM SETBACK REQUIREMENTS. F.F.E:1202.37 F.F.E:1213.97 At, p-'r F.F.E.-1.1206. W I I I &f.E.-1209.95 FFE:t2aB.40- BUILDING F.F.E.-1214.02 1 cz3!- D:s.,. FRONT YARD THE GREATER OF 15 FEET OR �g9 F.F.E.-1213.99 j .I p { r__�"12j1 -ce 50 FEET FROM THE rldaw WITNESS CORNER F.F.E:1209.99 PORCH fl W I.c0 I I i 01 L2 CENTERLINE OF THE FRONTING 5.0' WEST OF CORNER • v> F.F E-1209.9B F.F.E.-1210.00 FFE.-1213.99 / '� STREET.F.F.E. 1213.99 / 1 2 PK NAIL W/WASHER P505 •' re- /�- 133 o'.i - ',., i1 Q- SIDE YARD NO REQUIREMENT 811. 1-ram \POf;,H W- 8g•¢ Y --t212-" =a STREET SIDE YARD THE GREATER OF 15 FEET ORcommon -_ 50 FEET FROM THE oc ,& - -T o F= CENTERLINE OF THE FRONTING �' r2p3 -1205 • 133.00'R r i 1 o OSP .. - I 6 STREET. 5-�-,-(•,-"O'-,I 1'. 2g 'r\ 134.21'M•1 J. ", \Ns, 0 .+_•N ,.� ,*' �w REAR YARD 15 FEET e,onw Description Ma,•o°-Yr� \ + ''' OONCRETE WALK- ,V • �' �actRG- i 5. THE BUILDING CONTAINS 4,565 SQUARE FEET. THIS AREA .. \ \, �I' I ":-- -'''',."I.t - .1}+ _ 1�'I __ ,�"'' WAS CALCULATED USING EXTERIOR BUILDING DIMENSIONS _ _ y / 'I MEASURED AT GROUND LEVEL. /` / 0"' ' ;°/ o ti' o','• ti' °' ti ti^ t I �� Job No.: 1480.14-2 AL ........... ^o° ro h ry � ti ,1 6. THERE ARE 14 STANDARD PARKING SPACES ON THE Drawn B MRS ( IY / i i , 0 3 PROPERTY. y' +. _ p I Reviewed By:CEO 11 ASPHALT HARNEY STREET "1 I I 7. THE UTILITY LOCATIONS ON THIS DRAWING WERE DETERMINED Date:06/24/2014 �... (DEDICATED PUBLIC RIGHT-OF WAY) GI BY OBSERVED EVIDENCE AT THE TIME OF SURVEY, RECORDS Odd Book:115 �pN1111i PROVIDED BY UTILITY COMPANIES AND THOSE MARKED BY Pages:46-48 1 UTILITY COMPANY REPRESENTATIVES THAT RESPONDED TO v_ "ONE CALL"TICKET NUMBER 1 41 681 342 NO RESPONSIBILITY `�-•• OR LIABILITY IS ASSUMED BY THE SURVEYOR FOR THE FAILURE TO SHOW ANY BURIED SERVICE AND/OR UTILITY LINES EVEN THOUGH THEY MAY EXIST. LOT 16 LOT 1 8. THE DRAWING SHOWS OR NOTES THE EASEMENTS LISTED UNDER SCHEDULE B-SECTION II OF OLD REPUBLIC NATIONAL s-,wme., ,r BLOCK 16, HIGHLAND PLACE TITLE INSURANCE COMPANY COMMITMENT FOR TITLE INSURANCE NUMBER 20140160, EFFECTIVE DATE APRIL 16, SHEET 1 OF 1 2014 AT 8:00 A.M. AND REVISED ON 04/28/2014. EXHIBIT "B" 40 HARNEY-FARNAM TIF REDEVELOPMENT PROJECT PLAN 4004 HARNEY AND 4001 FARNAM STREET SEPTEMBER 2014 0MAH4, N fV 4¢ � r416 0 441)FE$"0.4. 4- PLANNING.OMAHA Jean Stothert, Mayor City of Omaha James Thele, Director Planning Department Omaha/Douglas Civic Center 1819 Farnam Street, Ste. 1111 Omaha, Nebraska 68183 INTER-OFFICE COMMUNICATION City of Omaha,Nebraska Planning Department TO: Chairman and Members of the Planning Board FROM: James Thele,Planning Director DATE: July 16,2014 SUBJECT: 40 HARNEY-FARNAM TIF REDEVELOPMENT PROJECT PLAN 4004 Harney and 4001 Farnam Streets Case#C3-14-130 Project Summary This redevelopment project plan proposes to continue revitalization efforts for two early twentieth century structures within the Blackstone Business District at the southwest corner of 40th and Farnam Street,south to 40th and Harney Street. The Blackstone Business District is becoming a vibrant destination with the relocation and renovation of Sullivan's Bar, the completion of the 40th and Farnam mixed-use TIF redevelopment project and the commencement of the 39th&and Farnam commercial and retail TIF redevelopment project. This district will be a great connector between the University of Nebraska Medical Center,Midtown Crossing,and downtown Omaha. The 4001 Farnam,LLC,engaged Greenslate Development,LLC, ("Greenslate")to develop this project,which is comprised of Jay Lund and Matt Dwyer. Jay and Matt recently completed their first development in the Blackstone District on the northeast corner of 40th&Farnam Streets. The northeast corner is 100% occupied. Project Description The two structures at the southwest corner of 40th and Farnam Street,south to 40th and Harney Streets were built in 1924 and 1907,respectively. No federal or state historic tax credits are involved with this project. The Farnam structure-4001 Farnam Street-is a commercial building. The Harney structure- 4004 Harney Street-is a multi-family(townhouse) structure,which had code issues in the past that were resolved,yet the property is still in disrepair. Greenslate contemplates the complete rehabilitation of each structure,restoring the multi-family structure to its original number of 6 units;currently there are 12 units. These will be 3-bedroom units. The Harney structure will undergo complete rehabilitation,including restoring the exterior to its original form. The project is anticipated to be completed by May 2016. No Building Permit will be issued based on a site plan that does not comply with the provisions of the Zoning Ordinance. The project site is located within a Community Redevelopment Area,meets the requirements of Nebraska Community Development Law and qualifies for the submission of an application for the utilization of Tax Increment Financing to cover costs associated with project development as submitted for approval through the Tax Increment Financing process. The project is or will be in compliance with the Master Plan,appropriate Ordinances and development regulations of the City. DEPARTMENT RECOMMENDATION: Approval. ATTACHMENTS General Vicinity Map Project Plan BH 5 CASE: C3-14-130 APPLICANT: Planning Department on behalf of the City of Omaha REQUEST: Approval of the 40 HARNEY-FARNAM TIF REDEVELOPMENT PROJECT PLAN LOCATION: Southwest of 40th and Farnam Streets SUBJECT AREA IS SHADED -AUGUST 2014 .H.,....:::::.,..,- 8 A�C1 1(PL ►;O-ACt 1(PL GC A 11(PL) GC....................) l'. ....il..:H.......................... s...':, ....::.H:-.' '.:.':........ yAC 1 1(1PL) PK . 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ACI-1(P ,..H :„.....:::;.......: .:::,::...„:H...... _.... ..,::...:„.... . . ••..„...„..„......H...::...H:„......:„.....,....i......:..:.. ...::::H: :..... ......:.....• .. . .. .. .. .... ..... . ..... ..: .. .. ::.,.. ..........:.::........ . . ... . ..:....;;:,::::..,..........„„„... ::.. :...:::::.......... :.. ,..........:.......... ....... ...,.. . AC -1(PL) Overlay District IV 0 400 o�a���N� °,^^�^ Feet art: "'^u t, M L il sfF 4 g n N 'K M ,. was[ o....n. k n..,' .aw _tell fid! I a r i a3i Ir c e • Ili _<m la 1Ce m j 0) ico 0 0 12.ed a '4 r Piasg S. sl 71E °' 11 Cl)0. L INTER-OFFICE COMMUNICATION Date: July 18, 2014 To: TIF Committee: James Thele, Stephen Curtiss, AL Herink, Paul Kratz, Robert Stubbe, Todd Pfitzer, Cassie Seagren, Gail Braun From: Bridget A. Hadley - City Planning Applicant: City of Omaha Planning Department Project Name: 40 Harney-Farnam TIF Redevelopment Project Plan Location: 4004 Harney and 4001 Farnam Streets Project Summary This redevelopment project plan proposes to continue revitalization efforts for two early twentieth century structures within the Blackstone Business District at the southwest corner of 40th and Farnam Street, south to 40th and Harney Street. The Blackstone Business District is becoming a vibrant destination with the relocation and renovation of Sullivan's Bar, the completion of the 40th and Farnam mixed-use TIF redevelopment project, and the commencement of the 39th & and Farnam commercial and retail TIF redevelopment project. This district will be a great connector between the University of Nebraska Medical Center, Midtown Crossing, and downtown Omaha. The 4001 Farnam, LLC, engaged Greenslate Development, LLC, ("Greenslate") to develop this project, which is comprised of Jay Lund and Matt Dwyer. Jay and Matt recently completed their first development in the Blackstone District on the northeast corner of 40th & Farnam Streets. The northeast corner is 100% occupied. Project Description The two structures at the southwest corner of 40th and Farnam Street, south to 40th and Harney Streets were built in 1924 and 1907, respectively. No federal or state historic tax credits are involved with this project. The Farnam structure—4001 Farnam Street—is a commercial building. The Harney structure—4004 Harney Street—is a multi-family (townhouse) structure, which had code issues in the past that were resolved, yet the property is still in disrepair. Greenslate contemplates the complete rehabilitation of each structure, restoring the multi-family structure to its original number of 6 units; currently there are 12 units. These will be 3-bedroom units. The Harney structure will undergo complete rehabilitation, including restoring the exterior to its original form. The project is anticipated to be completed by May 2016. Proiect Finance Summary - Sources & Uses Sources of Fus, Owner Equity $350,000.00 Other Financing, Dundee Bank $1,699,650.00 Tax Increment Financing, Dundee Bank,* 5% $184,5000.00 Total Sources of Funds S2,234,150.00 Uses of Funds Building Acquisition Costs $1,015,000.00 Construction Hard Costs $1,111,000.00 Construction Soft Costs $108,150.00 Total Uses of Funds $2,234,150.00 Land Use and Zoning The current land uses are commercial and residential (townhouse). The proposed uses are the same. The site is zoned CC-ACI 1 with Conditional Use Permit for the residential at 40th & Harney Streets. Utilities and Public Improvements Standard utilities (electrical, water, sewer) exist at the site. Burial of existing electrical cables are contemplated. New utility services provided to the properties. Replacement of sidewalks in conjunction with streetscape implementation consistent with urban design requirements is also contemplated. Transportation No transportation issues, other than the two-way conversion of Farnam Street between 36th and 42"d to make the area more pedestrian friendly and to allow for slower traffic flow in this business district. Cost Benefit Analysis (from the TIF Application) 1. Pursuant to Neb.Rev.Stat. 18-2147 there will not be a tax shift resulting from the approval of the use of funds. The 4004 Harney property is deteriorating and would see a decrease in valuation without redevelopment. Further, the housing to be provided is necessary to meet the housing demands near the University Of Nebraska Medical Center. The redevelopment of 4001 Farnam St. will allow for a more attractive retail space and more practical use of the space. This allows for increased efficiency and volume of business creating jobs and increased sales tax. 2. Public infrastructure and community public service needs will realize a positive impact based upon the redevelopment. Without redevelopment, the housing and retail space will not see an increased property valuation. Redevelopment of the properties allows the Blackstone District to realize improved amenities and services. 3. Employers and employees of firms locating or expanding within the boundaries of the redevelopment project will realize a positive impact. The market desires rehabilitated residential and commercial properties while keeping the historic aesthetics of the Blackstone District. The redevelopment will continue to add much needed housing and services for the community. 4. Any employers and employees within the city that are located outside of the boundaries of the area of the redevelopment project will not realize a negative impact. 5. The continued resurgence of the Blackstone Improvement District is essential to infill development, cohesive redevelopment throughout the core of the city, and consistent with City Master Plan. Farnam Street is a major arterial in the City of Omaha and the investment along Farnam will add to the momentum in midtown Omaha. TIF Justification The project site is located within a Community Redevelopment Area, meets the requirements of Nebraska Community Development Law and qualifies for the submission of an application for the utilization of Tax Increment Financing to cover costs associated with project development as submitted for approval through the Tax Increment Financing process. The project is/or will be in compliance with the Master Plan, appropriate Ordinances and development regulations of the City. This TIF redevelopment project plan continues redevelopment and revitalization efforts within the Blackstone Business District. It contributes to a connecting thread of destination spots from the Downtown Omaha westward along Farnam Street through Midtown. The project will support and help strengthen the additional economic activity within the Blackstone Business District. Ultimately, this project plan will enhance the tax base for various taxing jurisdictions. TIF will be used to offset costs such as acquisition, rehabilitation costs, landscape sidewalk repair, architectural and engineering fees, and public improvements as required. $15,000.00 of the TIF proceeds/loan will be contributed toward the Midtown Public Improvement Fund. The total estimated project costs are $2,234,150.00. TIF Eligible costs are as follows: Acquisition (Commercial & Townhomes) $1,000,000.00 *Hard Construction Costs $1,046,000.00 Architecture & Engineering Fees $ 54,075.00 Total $2,100,075.00 TIF Fees $ 3,500.00 Total TIF Eligible $2,103,575.00 *Excludes commercial TI allowances The TIF is 8.0% of the total project costs. Request: The TIF request is for up to $184,500.00. The owner/applicant anticipates a final project value of$2,325,000.00 based on an after rehab appraisal dated March 18, 2014. Using the interest rate of 5.0%, the current levy rate of 2.19974% and other assumptions of the TIF calculation spreadsheet supports the TIF request. See attached TIF calculation spreadsheet(s). TIF Fee Schedule: $500.00 application fee paid; the processing fee of$3,000.00 will be billed; no administrative fees. Total fees will be $3,500.00. Recommendation: Approval ATTACHMENTS TIF Application TIF Calculation Spreadsheet Applicant: 40 Harney-Farnam PRO FORMA Debt Service Payments Total Less Pre- TIF ' Treasurer's Revenues Taxable Development Taxable Tax Tax 1%Collection Available Interest at Loan Capitalized Interest at DATE Valuation Base Valuation Levy Revenues Fee For TIF Loan Principal 5.00% Total Balance Interest 5.00% $184,500 0 $0 $0 $0 $189,113 4613 4613 0.5 $ 0 $ - 2.19974 $ $ $1 $ 0 $ 2.19974 $ $ $ $0 $0 $0 $193,841 4728 4728 - 1.5 $ 0 $ 2.19974 $ - $ - $ $0 $0 $0 $198,687 4846 4846 2 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $10,226 $4,967 $15,193 $188,461 0 4967 2.5 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $10,481 $4,712 $15,193 $177,980 0 4712 3 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $10,743 $4,450 $15,193 $167,237 0 4450 3.5 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $11,012 $4,181 $15,193 $156,225 0 4181 4 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $11,287 $3,906 $15,193 $144,938 0 3906 4.5 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $11,570 $3,623 $15,193 $133,368 0 3623 5 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $11,859 $3,334 $15,193 $121,509 0 3334 5.5 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $12,155 $3,038 $15,193 $109,354 0 3038 6 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $12,459 $2,734 $15,193 $96,895 0 2734 6.5 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $12,771 $2,422 $15,193 $84,124 0 2422 7 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $13,090 $2,103 $15,193 $71,034 0 1776 2103 7.5 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $13,417 $1,776 $15,193 $57,617 0 1776 8 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 8 153 $ 15,193 $13,753 $1,440 $15,193 $43,864 8.5 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $14,096 $1,097 $15,193 $29,768 0 1097 9 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $14,449 $744 $15,193 $15,319 0 744 9.5 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $14,810 $383 $15,193 $509 0 13 10 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $15,180 $13 $15,193 $0 10.5 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $0 $0 $0 $0 0 0 11 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $0 $0 $0 $0 0 0 11.5 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $0 $0 $0 $0 0 0 12 $ 1,395,248 0 $ 1,395,248 2.19974 8 15,346 $ 153 $ 15,193 $0 $0 $0 $0 0 0 12.5 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $0 $0 $0 50 0 0 13 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $0 $0 $0 $0 13.5 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $0 $0 $0 $0 0 0 14 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 8 15,193 $0 $0 $0 $0 0 0 14.5 $ 1,395,248 0 $ 1,395,248 2.19974 $ 15,346 $ 153 $ 15,193 $0 $0 $0 $0 0 0 15 $ 1,395,248 0 $ 1,395,248 2.19974 8 15,346 $ 153 $ 15,193 $0 $0 $0 $0 $414,342 $4,131 $410,211 $213,358 $44,923 $258,281 $14,187 ASSUMPTIONS: (F9=calculate) NOTE:This information is provided to assist in analyzing the Original Loan Amount $184,500 Interest $14,187 1.Assume No Pre-Development Base Capitalized specific request to the TIF committee. This information is subject Ca P Loan Amount: $184,50 to change based on actual tax assessments.This schedule assumes Loan Balance Remaining $0 2. st Rate: 0 4,50 0 $198,687 POTENTIAL 3.Prjec a 64%real estate valuation and a 1.0 debt coverage ratio.The o Hard Costs: $2,185005 actual TIF amount available to fund site specific project cost will5.Increment Base: $2, 80,075 change based on the cost of public improvements. Annual Incremental Tax Payment $ 30,692 TAX INCREMENT FINANCING REQUEST 4001 FARNAM LLC 4001 FARNAM & 4004 HARNEY OMAHA,NEBRASKA Prepared By: 4001 Farnam LLC June 23, 2014 TIF APPLICATION Project Legal Description: HIGHLAND PLACE LOT 3 BLOCK 15 N 55.5 FT LTS 1-2 & 55.5 X 133 HIGHLAND PLACE LOT 3 BLOCK 15 S 82 FT LTS 1-2 & 82 X 133 Project Address: 4001 Farnam Street, Omaha,Nebraska 68131 4004 Harney Street, Omaha,Nebraska 68131 Property Owner/Applicant Name: 4001 Farnam, LLC Owner Address: Greenslate Development 450 Regency Parkway#220, Omaha,NE 68114. Attention: Matt Dwyer Estimated Total Project Cost: Hard cost= $1,111,000 Acquisition= $1,015,000 Soft cost= $108,150 Total project= $2,234,150 TIF Request: $184,500.00 New Construction: No Rehabilitation: Yes Proposed Project Size: 11,519(Harney Street, hereinafter"H") + 6644 (Farnam Street, hereinafter"F") = 18,163 Gross Square Feet 11,519(H) +6644 (F) = 18,163 Net Square Feet .25(H) + .16(F) _ .41 Acres 10,906(H) + 7381(F) = 18,287 Lot/Parcel Size LIHTC Project: No Market-Rate Project: Yes Historic Tax Credit Project: No Current Use: 4004 Harney Street property currently is built for 12 apartment buildings. Most are uninhabitable and only one unit is occupied. 4001 Farnam Street is a building composed of 4 retail bays. Proposed Use: Redevelop dilapidated apartments into market-rate town homes. Provide structural and aesthetic improvements for commercial building and public improvements to sidewalks and utilities. Current Zoning: GC-ACI-1(PL) Proposed Zoning: GC-ACI-1(PL) Current Real Estate Taxes (2014 Tax Year): $11,896.50 (F) $7,698.64 (H) Current Assessed Tax Valuation (2014 Tax Year): Land: $88,600(F) $16,400(H) Improvements: $477,900(F) $344,400(H) Total: $566,500(F) $360,800(H) $927,300.00 I) Narrative A. Detailed Project Description The Blackstone District has the potential to be a vibrant business district and serve as another multi-use neighborhood in midtown Omaha. Additionally, the redevelopment of this area would connect a business district to the University of Nebraska Medical Center to Midtown Crossing to downtown Omaha. 4001 Farnam, LLC, recognizes the potential for this area and would like to be part of the effort to strengthen the urban core of the city. Through the purchase of the property and redevelopment to the buildings, 4001 Farnam, LLC, hopes to provide desirable tenant space to potential restaurateurs, shop owners, entrepreneurs, business owners, residents, and anyone else who shares the vision for this neighborhood. 4001 Farnam, LLC, engaged Greenslate Development, LLC, ("Greenslate") to develop this project. Greenslate is comprised of Jay Lund and Matt Dwyer. Lund and Dwyer recently completed their first development in the Blackstone District on the Northeast Corner of 40th & Farnam. They are pleased to report 100% occupancy on the Northeast Corner. The project includes redevelopment of two parcels. The first parcel is a residential complex at 4004 Harney Street. The Harney redevelopment sits on 10,906 square feet with 11,519 usable square feet living space. While the units exteriors appear in usable condition to passersby, the majority of the buildings are in major disrepair and uninhabitable. The apartment buildings were built in 1907 and only one unit is currently occupied. The second parcel is directly north and adjacent to the Harney redevelopment at 4001 Farnam Street. 4001 Farnam Street was built in 1924 and is comprised of 6644 square feet on 7381 square feet of land. Fifty percent of the commercial bays are leased. Structural, exterior, and interior rehabilitation is necessary on the property. Greenslate will seek to keep any tenants in the current space if possible. The redevelopment will remove the current exterior to bring the building back to the original form as well as add public improvements along the east and north portions of the building including new sidewalks and streetscape. The Redevelopment Project will be managed by Greenslate Development, LLC. Matt Dwyer and Jay Lund are the principals of Greenslate Development, LLC. B. Land Use Plan: Mixed Use Development C. Zoning—Current - GC-ACI-1(PL) Proposed—GC-ACI-1(PL)with residential Conditional Use Permit D. Public Improvements: Utility lines will be buried. New utility services provided to the properties. Replace sidewalks in conjunction with streetscape implementation consistent with urban design requirements as approved by city planning and public works. E. Historical Status: N/A Sources & Uses/Total Project Costs Owner Equity $350,000.00 Other Financing $1,699,650.00 Tax Increment Financing $184,500.00 Total Sources of Funds $2,234,150.00 Uses of Funds Acquisition $1,015,000.00 Construction Hard Costs $1,111,000.00 Construction Soft Costs $108,150.00 Total Sources and Uses of Funds $2,234,150.00 Project Timeline: Redevelopment of property begins December 1, 2014. Stabilized and occupied by May 30, 2016. Construction Budget Acquisition Commercial $ 450,000.00 Acquisition Townhomes $ 550,000.00 Closing Costs $ 15,000.00 Subtotal $ 1,015,000.00 6 townhouse units gutted/redeveloped $ 869,500.00 commercial roof $ 30,000.00 commercial Tuck-pointing and Brick exposure $ 30,000.00 commercial storefronts $ 45,000.00 Landscaping sidewalk repair $ 20,000.00 commercial TI Allowances (includes HVAC) $ 65,000.00 Contingency $ 51,500.00 Subtotal $ 1,111,000.00 Total Hard Cost $ 1,111,000.00 General Contractor/ Professional Fees $ 54,075.00 Architecture and Engineering $ 54,075.00 Soft Cost Total $ 108,150.00 TOTAL Hard+Soft Costs+ Acquisition $ 2,234,150.00 3-Year Pro-Formas—profit/loss and cash flow statements 1 2 3 Year Year Year 2016 2017 2018 Net Income $ 160,450.84 $ 165,819.86 $ 170,256.25 Debt Service $ (138,632.03) $ (138,632.03) $ (138,632.03) Cash Flow $ 21,818.81 $ 27,187.83 $ 31,624.22 *Real Estate taxes are projected to increase to$39,595.14 in 2016-2018. The real estate tax expense is deducted prior to the net income. The project anticipates additional increases over the term of the TIF. Return 6.2% 7.7% 9.0% ROI Analysis—"But For" Return on Investment with Tax Increment Financing 1 2 3 Year Year Year 2016 2017 2018 Net Income $ 160,450.84 $ 165,819.86 $ 170,256.25 Debt Service $ (138,632.03) $ (138,632.03) $ (138,632.03) Cash Flow $ 21,818.81 $ 27,187.83 $ 31,624.22 Return 6.2% 7.7% 9.0% Return on Investment without Tax Increment Financing 1 2 3 Year Year Year 2016 2017 2018 Net Income $ 160,450.84 $ 165,819.86 $ 170,256.25 1st Debt Service $ (138,632.03) $ (138,632.03) $ (138,632.03) 2°a Debt Service $ (28,920.00) $ (28,920.00) $ (28,920.00) Cash Flow $ (7101.19) $ (1732.17) $ 2,704.22 Return -2.0% 0% .01% The redevelopment of 4004 Harney and 4001 Farnam will not proceed, but for tax increment financing. The property is in significant disrepair. Without proper renovation and investment the property is inhabitable. The floors are unstable. Ceilings and walls are exposed. Due to the significant repair costs, especially at 4004 Harney, the redevelopment project does not make financial sense without tax increment financing and otherwise would not proceed without tax increment financing. Evaluation Criteria: Mandatory Criteria 1. The project is located within a community redevelopment area. Please find a map attached. 2. The use of Tax Increment Financing will not result in a loss of pre-existing tax revenues to the City and other taxing jurisdictions. The housing units are in major disrepair and property valuation will decrease or remain stagnant. Therefore, taxing jurisdictions would not realize additional tax revenue without redevelopment. The redevelopment at 4001 Farnam St. will allow for current businesses to grow because of improvements in the interior and exterior of the building. The commercial property has likely realized its' highest valuation without redevelopment. With the continued redevelopment and revitalization of the Blackstone Business District at 4001 Farnam St., all commercial tenants will see an increased volume of sales and services resulting in additional tax revenue. 3. This redevelopment project would not be economically feasible without the use of Tax Increment Financing. TIF helps reduce the risk related to the undertaking of this project in Omaha. 4. This project furthers the objectives of the City's Master Plan. This includes job creation, implementation of Urban Design elements of the project and related areas, preservation of historic sites and structures, revitalization of older neighborhood communities, business growth, and the densification of the urban core. Furthermore, this project increases the variety of housing choices in the Blackstone District, preserves original buildings, enhances the urban experience, and continues neighborhood connectivity. Cost-Benefit Analysis (Appendix Five of TIF guidelines; include quantitative analysis) 1. Pursuant to Neb.Rev.Stat. 18-2147 there will not be a tax shift resulting from the approval of the use of funds. The 4004 Harney property is deteriorating and would see a decrease in valuation without redevelopment. Further, the housing to be provided is necessary to meet the housing demands near the University of Nebraska Medical Center. The redevelopment of 4001 Farnam St. will allow for a more attractive retail space and more practical use of the space. This allows for increased efficiency and volume of business creating jobs and increased sales tax. 2. Public infrastructure and community public service needs will realize a positive impact based upon the redevelopment. Without redevelopment, the housing and retail space will not see an increased property valuation. Redevelopment of the properties allows the Blackstone District to realize improved amenities and services. 3. Employers and employees of firms locating or expanding within the boundaries of the redevelopment project will realize a positive impact. The market desires rehabilitated residential and commercial properties while keeping the historic aesthetics of the Blackstone District. The redevelopment will continue to add much needed housing and services for the community. 4. Any employers and employees within the city that are located outside of the boundaries of the area of the redevelopment project will not realize a negative impact. 5. The continued resurgence of the Blackstone Improvement District is essential to infill development, cohesive redevelopment throughout the core of the city, and consistent with City Master Plan. Farnam Street is a major arterial in the City of Omaha and the investment along Famam will add to the momentum in midtown Omaha. EMPLOYMENT INFORMATION Provide employment information. Job Creation/Retention Figures Job Creation/Retention Types Permanent Jobs(EFTs) 25 Management 8 Part-Time Jobs 16 Technical 5 TOTALS 33EFTs Sales/Marketing 6 Clerical/Administration 6 Total Jobs CREATED 23 Production 2 Total Jobs RETAINED 10 Clerk/Service 6 TOTALS 33 General Labor TOTALS Anticipated Annual Payroll or Average Annual Wage for Full & Part-Time Jobs $45,000 Estimated number of construction jobs created as a result of this project 40 Anticipated Payroll for Construction Jobs $50,000 RESIDENTIAL UNIT INFORMATION Provide the unit mix and rental income information. UNIT MIX MONTHLY RENTS Single-Family Rental 1 bedroom 0 Not Applicable 2 bedroom 0 Not Applicable 3 bedroom 0 Not Applicable 0 Owner-occupied 1 bedroom 0 Not Applicable 2 bedroom 0 3 bedroom 0 Multi- Rental 1 bedroom Family 2 bedroom 6 2400 Square Foot Townhomes 3 bedroom $2250 Owner-occupied 1 bedroom (Condos,Townhomes,etc.) 2 bedroom Not Applicable 3 bedroom Total Units Six 3 Bedroom Townhomes $13,500 2400 Square Feet Application Attachments: A. Site Plans & Elevations B. Alta Survey (site specific) C. Documentation of Ownership or Site Control D. Preliminary Commitment Letters for Financing with terms and/or for Equity E. Organization Documentation 1. LLC Papers 2. Current Certificate of Good Standing 3. Documentation stating authorized signors F. Reports and Studies, if applicable 1. Appraisal, as-is and/or after rehab 2. Market Study 3. Feasibility Study 4. Environmental Study 5. Traffic Study G. Historic Designation Documentation, if applicable • F A R N A M STREET g V KEYED NOTES y'A�� O CITY OF OMAHA TYPICAL PLANTER;SEE DETAIL {` v - 1► O NEW CONCRETE WALK:COORDINATE EXTENT WITH CITY OF iii OMAHA CORNER IMPROVEMENT WORK OCORNER IMPROVEMENTS BY OTHERS I ��� 2 O NEW CITY OF OMAHA APPROVED URBAN AREA TREE. -��,I ® TRIUMPHANT ELM OR KENTUCKY COFFEE TREE PREFERRED. 4 EXIST EXIST EXIST EXIST / ���e 3 0 VERIFY STOOP CONDITIONS WITH BUILT SPACE BELOW PRIOR ill W < SLOG BLOG BLDG SLOG I���j�e O TO DEMOLITION.(TYPI. 1I: 4ir pi ��A 1 O VERIFY TIE DOWN RELOCATION WITH OPPD U ...1 'I O INFILLEPOWER EXISTINGPOLESW LOITHWERED WALK AND COORDINATE NEW -`- r.- o o o H O PATCH AND REPAIR EXISTING LOT AND RESTRIPE r \% y -I— — — — S , — — — — w O NEW CARPORT OVER REVISED PARKING. W k.,„ � io +OO EXISTING CURB CUT TO REMAIN 11 EXISTING WALKS TO REMAIN VI = REPAIR EXISTING PORCHES O . O T—O _ - o 4 a' EXISTING TOWNHOMES TO BE RENOVATED 4 n 133'-0- < 11 L ` ` ' - - - - 133'-0' - - - — ,z HARNEY STREET 6 PROJECT NAME: BLACKSTONE DISTRICT-DEVELOPMENT PLAN DWG.NO. ALLEY.POIMEN MAC CHIE110 PROJECT NUMBER: 14086 SK4 n1m m DATE: 2014-06-25 - - — Al M1m017.Cotm ..... ,... ,..4 . ..f...\ 'i - { 46'‘1111.41.496.V.• ''-"/ ems. _ ...,.... ,il t`.an. w+erram.. r a 1 ,1f 1 __ 1 - q a \ • mil",•�;; i .,�-., , . •NIP WO; 111111111, ,,,,. ,,,,,7,......;:;.1.........---A—+- o t (41111111 111101 lilV -- -'' .. ........-:-' ---)* ,------- ' • .' - . ',--..,. - ...* e,.Y. '_. _„,, ,....7,.,..„5„.7._7z1r.I.,„,,,:::-..4.,,,z,„,..,- 8/5/2014 photo.JP9 • ta • e f. 1/1 https://mai I.g oog ie.conYmai l/u/0/#i nboxd147a697df4bb0c54?projector=1 dundee bank :E, E July 1, 2014 4001 Farnam, LLC Attn: Mr. Matt Dwyer 450 Regency Parkway Suite 220 Omaha,NE 68114 RE: Tax Increment Financing Loan 4001 Farnam Street 4004 Harney Street Omaha,NE 68131 Dear Mr. Dwyer: This letter, when accepted by you, will constitute the agreement of Dundee Bank, a Branch of Security State Bank("Lender") to provide 4001 Farnam, LLC ("Borrower")a Tax Increment Financing Note("Loan") in accordance with the terms,conditions and provision hereinafter outlined. 1. Borrower: 4001 Farnam, LLC, a Nebraska limited liability company 2. Loan Amount: Loan amount shall be no more than $184,500 or 90%of the Tax Increment Financing Note with the City of Omaha 3.Loan Term: After completion of construction period,TIF note will be matched to the term of the redevelopment promissory note from the City of Omaha, but in no event to be more than 15 years 4.Interest Rate: 5.00% fixed for five years then Wall Street Prime plus 1.00% with a floor of 5.00% thereafter 5. Loan Fee: $250 origination to Dundee Bank 6. Loan Repayment: Semi-Annual principal and interest payments to closely correspond with the payments made on the City of Omaha i': !ak Redevelopment Promissory Note in an amount necessary to fully amortize the loan over the stated term of the note 7.Collateral: Security and Pledge Agreements from the City of Omaha, assigning annual real estate tax receipts to Lender and a second Deed of Trust on the property at 4001 Farnam Street and 4004 Harney Street,Omaha, Nebraska 68131 8. Guaranty: Loan shall be guaranteed on an unlimited joint and several basis by Matt Dwyer and Jay Lund. 9. Use of Funds: Funds will be used to provide financing for the TIF eligible expenses for the proposed development of the commercial real estate located at 4001 Farnam Street and 4004 Harney Street. 1O.Construction Loan: The TIF loan commitment described in this letter is contingent upon Dundee Bank, a Branch of Security State Bank being selected as the Construction/Mini-perm Lender on Subject Property. 11loan Documents: The TIP Loan shall be evidence and secured by: a) Promissory Note; b) Commercial Loan Agreement; c) Collateral Assignment and Pledge Agreement executed by Borrower (assigning Redevelopment Promissory Note issued by City of Omaha and Redevelopment Agreement between Borrower and City of Omaha)to Lender; d) Security Agreement and Pledge Agreement execute by City of Omaha giving Lender a security interest in TIP funds generated by the project; e) Uniform Commercial Code Financing Statement executed by City of Omaha in favor of Lender,covering TIF funds; 1) Opinion letter issued by Assistant City Attorney of Omaha in form and content satisfactory to Lender's counsel with respect to the TIF financing; g) Guaranty Statement; h) Second Deed of Trust on the subject property; and; i) Any other documentation required by Lender The form and content of all above mentioned loan documents shall be reasonably satisfactory to Lender's counsel. 12. Requirements Prior to Loan Closing: At least fourteen (14)days prior to the closing date, Borrower shall have furnished to Lender each of the following in form and content acceptable to Lender: a) Title; Acceptable Title Search only. b) Insurance: Builder's risk, fire and extended coverage insurance for the full insurable value of the building, including comprehensive general liability insurance. All insurance policies required hereunder shall be issued by companies,on forms,in amounts and with deductibles acceptable to Lender,and shall show Lender as a loss payee with a standard non-contributory mortgagee clause in favor of Lender. Such policy shall provide that there shall be no cancellation or modification without less than thirty(30)days prior written notice to Lender. All such policies shall be renewed during the term of the loan and copies of same shall be provided to Lender at least thirty(30)days prior to the termination date of any then current policy. Rent loss coverage of at least six (6) months shall be required. c) Tuxes and Assessments: Evidence that all installments of general real estate taxes, special taxes or assessments and the like are paid. d) Legal Compliance: Evidence from local governmental authorities having jurisdiction that the subject property complies with all zoning requirements, fire marshal requirements, city code requirements, and any other local ordinance relative to the property's development. e) Financial Statements:The Borrower's and Guarantors' financial statements shall be signed by the Borrower and Guaranty,and addressed to the Lender upon Lender's request. Lender may reasonably require annual operating statements on subject property and annual financial statements on ►he Borrower and Guarantors, including Federal Tax Returns and Schedule K- 1(s). E) U.C.C.Searches: U.C.0 searches against Borrower and such other parties as Lender may require,showing that the personal property owned by the Borrower and attached to the property is free from all security interests, liens, encumbrances, and judgments,except the prior security interest to Lender; such searches to be updated as of the closing date. 13. Special Mortgage Provisions; The loan documents shall provide, in addition to all other provisions required by lender: a) Financial Statements and Reports: Borrower and Guarantor(s)shall furnish to Lender, within one hundred twenty (120)days after the dose of each year a copy of the Borrower's Income Statement and Balance Sheet and Guarantor's Personal Financial Statement(s). A copy of the Borrower's and Guarantors' Federal tax return and Schedule K-l(s) shall be provided to Lender no later than April 15'h of the subsequent year. If a tax return extension is filed,the extension form must be sent to the Lender,and the tax returns will be due no later than October 151t'. Lender will also require an annual cash flow statement and a summary of contingent liabilities for each Guarantor as well as a list of contingent liabilities. Borrower will agree to provide property operating statements and rent rolls upon request by Lender. b) Due on Sale or Encumbrance: It shall be an event of default if Borrower shall,without the prior written consent of Lender,sell,convey, alienate, mortgage or encumber Borrower's interest in the Real Property or any other collateral securing the loan,or any part thereof,or any interest therein,or shall be divested of its title thereto, whether by operation of law or otherwise,or if there is a sale or other transfer of a majority of the outstanding membership units of the Borrower held by the Guarantors. c) Prepayment: Borrower has the right to prepay the principal balance of the loan,in whole or in part, without any fee or premium,upon thirty(30) days prior written notice to Lender. 14. Conditions of Closing:The Lender's obligation to disburse the loan contemplated hereunder, or any portion thereof,shall be conditioned upon the following occurring: a) Delivery of Loan Documents; Compliance: Borrower shall have delivered to Lender all documents and other items required hereunder,which shall be in such form and content as Lender shall prescribe. Borrower shall have satisfied each provision and condition of this commitment in a manner reasonably acceptable to Lender,or Lender shall have waived, in writing, Borrower's compliance with a specific provision. b) Payment of Costs by Borrower: Regardless of whether the loan closes, except for default by Lender, Borrower shall pay all of the Lender's costs in connection with the preparation,closing and disbursement of the loan, including but not limited to, title insurance premiums, survey costs,recording fees and taxes, lees and expenses of Lender's counsel and all other out-of- pocket costs and expenses incurred by Lender in connection with this loan. c) No Adverse Change: Borrower shall warrant that there has been no deterioration in the financial condition of Borrower and that the financial information heretofore submitted to Lender by Borrower is accurate and complete in all material respects. Lender will be promptly notified of any event that has,or with the passage of time could,cause a material adverse change in the financial condition of the Borrower, so long as any indebtedness represented by loan documents remain unpaid. 15. IRS Reporting: Borrower agrees to obtain Tax Identification Numbers on all contractors,sub-contractors and suppliers,and provide appropriate 1099 reporting to the IRS in connection with all payments made under this loan. 16. Credit Agreement: A credit agreement must be in writing to be enforceable under Nebraska Law. To protect you and us from any misunderstandings or disappointments,any contract,promise,undertaking,or offer to forebear repayment of money or to make any other financial accommodation in connection with this loan of money or grant or extension of credit,or any amendment of, cancellation of, waiver of,or substitution for any or all of the terms or provisions of any instrument or document executed in connection with this loan of money or grant or extension of credit, must be in writing to be effective. 17. Borrower Acceptance of Commitment: Borrower's acceptance of the commitment must be by Borrower's approval of this commitment by executing and returning a duplicate copy of the commitment letter not later than July 15, 2014 at 5:00 p.m.CST. This commitment may not be assigned by Borrower. 18. Cancellation of Commitment: if Borrower has not satisfied all of the requirements prior to closing date,time being of the essence,or if Borrower has breached or defaulted in the observance or performance of any of the undertakings,warranties or representations of Borrower in connection with this loan, the Lender shall have the option without giving prior notice to borrower to cancel the commitment and terminate all of the Lender's obligations hereunder (including, without limitation,the obligation to make any disbursements of the mortgage loan proceeds)and, thereupon, Lender shall have the right to pursue any other and further legal and equitable remedies available to Lender. 19. Commitment Expiration: Closing of this loan transaction must occur within 90 days from the date of commitment acceptance or this commitment shall be considered null and void. 20. CREDIT AGREEMENT: A CREDIT AGREEMENT MUST BE IN WRITING TO BE ENFORCEABLE UNDER NEBRASKA LAW. TO PROTECT YOU AND US FROM ANY MISUNDERSTANDINGS OR DISAPPOINTMENTS,ANY CONTRACT, PROMISE, UNDERTAKING, OR OFFER TO FOREBEAR REPAYMENT OF MONEY OR TO MAKE ANY OTHER FINANCIAL ACCOMMODATION IN CONNECTION WITH THIS LOAN OF MONEY OR GRANT OR EXTENSION OF CREDIT,OR ANY AMENDMENT OF,CANCELLATION OF,WAIVER OF,OR SUBSTITUTION FOR ANY OR ALL OFF THE TERMS OR PROVISIONS OF ANY INSTRUMENT OR DOCUMENT EXECUTED IN CONNECTION WITH THIS LOAN OF MONEY OR GRANT OR EXTENSION OF CREDIT, MUST BE IN WRITING TO BE EFFECTIVE. This commitment outlines certain basic terms and conditions of the Loans; however, it is not meant to define all of the terms and conditions of the Loans, which will be set forth more fully in the final documentation evidencing the Loans. Instead, the Commitment is intended only to outline certain basic points of the business understand around which legal documentation will be structured. The outlined terms and conditions are subject to final documentation satisfactory to all parties and complete legal review and approval of all pertinent matters. Dundee Bank a Branch of Security State Bank f )" By: Patrick Zuch, Loan Officer /\cc0tYrANCE / The above out \tied vunno and conditions are hereby accepted this_ _duyo[Ju|y.2014 ----~--- ------------ BY; April 1, 2014 4001 Farnam, LLC Attn: Ivlr. Matt Dwyer 450 Regency Parkway Suite 220 Omaha, NE 68114 RE: Construction Line of Credit 4001 Farnam Street 41004 Harney Street. Omaha, NE 68131 Dear Mr. Dwyer: This letter, when accepted by you, will constitute the agreement of Dundee Bank, a Branch of Security State Bank ("Lender") to provide 4001 Farnam, LLC ("Borrower")a Construction Line of Credit("Loan") in accordance with the terms,conditions and provision hereinafter outlined. I. Borrower: 4001 Farnam, LLC, a Nebraska limited liability company. 2. Loa►n Amount: Loan amount shall be no more than $1,699,650 or 80% of the "subject to completion" appraised value of=1001 Farnam Street and 4001 Harney Street,the subject property. 3, Loan Term: 18 month Construction Line of Credit. 4. interest Rate: 4.75Cf 5. Loan Fee: $3,000 origination to Dundee Bank. 6. Loan Repayment: Monthly interest only payments. 7. Collateral: First Deed of Trust on the property at 4001 Farm') Street and 4004 l larney Street,Omaha, Nebraska 68131 and Assignment of Rents and Leases on subject property. 8. Guaranty: Loan shall be guaranteed on an unlimited joint and several basis by Matt Dwyer and Jay Lund. 9.Use of Funds: Funds will he used to provide financing for the development of the commercial real estate located at 4001 Farnam Street and 4004 Harney Street. 10, Loan Documents: The Loan shall be evidence and secured by: a) Promissory Note; b) Commercial Loan Agreement; c) First Deed of Trust d) Guaranty Statement; and; e) Any other documentation required by Lender The form and content of all above mentioned loan documents shall be reasonably satisfactory to Lender's counsel. 11. Requirements Prior to Loan Closing: At least fourteen (14) days prior to the closing date, Borrower shall have furnished to Lender each of the following in form and content acceptable to Lender: a) Title: Evidence that title to the Collateral shall be good and marketable, free and clear of all defects, liens,encumbrances,security interests, restrictions and easements which Lender has not otherwise approved. Such evidence shall specifically include: i) Copies of all documents affecting title to the Collateral: ii) Evidence that ingress and egress from the project is by public streets; and iii) Evidence that all utilities serving the project are located in the public right-of-way abutting the project and if connected to the project by passing over property which is not public right-of-way, are connected to the project by means of easements which have been granted,are acceptable to Lender, and which will be insured through proper title insurance. b) Title Insurance: A commitment to issue,on the closing date, an ALTA extended coverage leasehold loan policy of title insurance to Lender,or such other form as Lender shall approve, for the full amount of the loan. The title insurance policy,when issued,shall contain a comprehensive endorsement (ALTA Form 9 or comparable endorsement),a date clown endorsement or similar affirmative coverage that will insure the first priority of Loan advance by Lender, and any and all other endorsement which Lender may require. Title shall be subject to those exceptions as Lender shall approve. c) Appraisal:The Lender will require an MA1 Appraisal Report on the subject property. The appraisal report must be in compliance with all of the minimum standards as required by FIRREA in their uniform appraisal standards adopted June 7, 1994,dealing with federally regulated institutions. The Loan amount will be limited to$1,699,650 or 80(70 of an accepted appraised value. d) Insurance: Builder's risk, fire and extended coverage insurance for the full insurable value of the building, including comprehensive general liability insurance. All insurance policies required hereunder shall be issued by companies,on forms, in amounts and with deductibles acceptable to Lender, and shall show Lender as a loss payee with a standard non-contributory mortgagee clause in favor of Lender. Such policy shall provide that there shall be no cancellation or modification without less than thirty(30)days prior written notice to Lender. All such policies shall be renewed during the term of the loan and copies of same shall be provided to Lender at least thirty(30)days prior to the termination date of any then current policy. Rent loss coverage of at least six (6) months shall be required. e) Taxes and Assessments: Evidence that all installments of general real estate taxes, special taxes or assessments and the like are paid. F) Legal Compliance: Evidence from local governmental authorities having juritidiction that the subject property complies with all zoning requirements, fire marshal requirements,city code requirements, and any other local ordinance relative to the property's development. g) Financial Statements: The Borrower's and Guarantors' financial statements shall be signed by the Borrower and Guaranty,and addressed to the Lender upon Lender's request. Lender may reasonably require annual operating statements on subject property and annual financial statements on the Borrower and Guarantors, including Federal Tax Returns and Schedule K- 1(s) h) U.C.C.Searches: U.C.0 searches against Borrower and such other parties as Lender may require, showing that the personal property owned by the Borrower and attached to the property is free from all security interests, liens, encumbrances,and judgments,except the prior security interest to Lender; such searches to be updated as of the closing elate. 12. Special Mortgage Provisions:The loan documents shall provide,in addition to all other provisions required by lender: a) Financial Statements and Reports: Borrower and Guarantor(s) shall furnish to Lender, within one hundred twenty(120) days after the close of each year a copy of the Borrower's Income Statement and Balance Sheet and Guarantor's Personal Financial Statement(s). A copy of the Borrower's and Guarantors' federal tax return and Schedule K-l(s)shall he provided to Lender no later than April I5°i of the subsequent year. if a tax return extension is filed, the extension form must be sent to the Lender,and the tax returns will he due no later than October 1 5°i. Lender will also require an annual cash flow statement and a summary of contingent liabilities for each Guarantor as well as a list of contingent liabilities. Borrower will agree to provide property operating statements and rent rolls upon request by Lender. b) Due on Sale or Encumbrance: It shall be an event of default if Borrower shall, without the prior written consent of Lender,sell,convey,alienate, mortgage or encumber Borrower's interest in the Real Property or any other collateral securing the loan,or any part thereof,or any interest therein, or shall be divested of its title thereto, whether by operation of law or otherwise,or if there is a sale or other transfer of a majority of the outstanding membership units of the Borrower held by the Guarantors. c) Prepayment: Borrower has the right to prepay the principal balance of the loan, in whole or in part, without any fee or premium, upon thirty (30)days prior written notice to Lender. 13. Conditions of Closing:The Lender's obligation to disburse the loan contemplated hereunder, or any portion thereof,shall be conditioned upon the following occurring: a) Delivery of Loan Documents; Compliance: Borrower shall have delivered to Lender all documents and other items required hereunder, which shall be in such form and content as Lender shall prescribe. Borrower shall have satisfied each provision and condition of this commitment in a manner reasonably acceptable to Lender,or Lender shall have waived, in writing, Borrower's compliance with a specific provision. b) Payment of Costs by Borrower: Regardless of whether the loan closes, except for default by Lender, Borrower shall pay all of the Lender's costs in connection with the preparation,closing and disbursement of the loan, including but not limited to, title insurance premiums,survey costs, recording fees and taxes, fees and expenses of Lender's counsel and all other out-of- pocket costs and expenses incurred by•Lender in connection with this loan. c) No Adverse Change: Borrower shall warrant that there has been no deterioration in the financial condition of Borrower and that the financial information heretofore submitted to Lender by Borrower is accurate and complete in all material respects. Lender will be promptly notified of any event that has,or with the passage of time could,cause a material adverse change in the financial condition of the Borrower,so long as any indebtedness represented by loan documents remain unpaid. 14. IRS Reporting: Borrower agrees to obtain Tax Identification Numbers on all contractors,sub-contractors and suppliers, and provide appropriate 1099 reporting to the IRS in connection with all payments made under this loan. IS. Borrower Acceptance of Commitment: Borrower's acceptance of the commitment must be by Borrower's approval of this commitment by executing and returning a duplicate copy of the commitment letter not later than April 15, 2014 at 5:00 p.m. CST. This commitment may not be assigned by Borrower. 16. Cancellation of Commitment: If Borrower has not satisfied all of the requirements prior to closing date, time being of the essence,or if Borrower has breached or defaulted in the observance or performance of any of the undertakings, warranties or representations of Borrower in connection with this loan, the Lender shall have the option without giving prior notice to borrower to cancel the commitment and terminate all of the Lender's obligations hereunder (including,without limitation,the obligation to make any disbursements of the mortgage loan proceeds)and, thereupon, Lender shall have the right to pursue any other and further legal and equitable remedies available to Lender. 17. Commitment Expiration: Closing of this loan transaction must occur within 90 days from the date of commitment acceptance or this commitment shall be considered null and void. 18. CREDIT AGREEMENT: A CREDIT AGREEMENT MUST BE IN WRITING TO BE ENFORCEABLE UNDER NEBRASKA LAW, TO PROTECT YOU AND US FROM ANY MISUNDERSTANDINGS OR DISAPPOINTMENTS,ANY CONTRACT,PROMISE, UNDERTAKING, OR OFFER TO FOREBEAR REPAYMENT OF MONEY OR TO MAKE ANY OTHER FINANCIAL ACCOMMODATION IN CONNECTION WITH THIS LOAN OF MONEY OR GRANT OR EXTENSION OF CREDIT, OR ANY AMENDMENT OF, CANCELLATION OF, WAIVER OF,OR SUBSTITUTION FOR ANY OR ALL OFF THE TERMS OR PROVISIONS OF ANY INSTRUMENT OR DOCUMENT EXECUTED IN CONNECTION WITH THIS LOAN OF MONEY OR GRANT OR EXTENSION OF CREDIT,MUST BE IN WRITING TO BE EFFECTIVE. This commitment outlines certain basic terms and conditions of the Loans: however, it is not meant to define all of the terms and conditions of the Loans, which will be set forth more fully in the final documentation evidencing the Loans. instead,the Commitment is intended only to outline certain basic points of the business understand around which legal documentation will he structured. The outlined terms and conditions are subject to final documentation satisfactory to all parties and complete legal review and approval of all pertinent matters. Dundee Bank a Branch of Security State Bank /71 By: /I Patrick Zach, Loan Officer ACCEPTANCE The above outlined terms and conditions are hereby accepted this j day of 2014 4001 Farnam, LC, By: VY/ LYI LV.-z it .'.� ia- • v.ivv saav - ---- Department of the Treasury In reply refer to: 0441875637 Internal Revenue Service Apr 24, 2014 LTR 147C Ogden, UT 84201 35-2505499 4001 FARNAM LLC % GREENSLATE DEVELOPMENT LLC SOLE M 450 REGENCY PKWY STE 220 OMAHA NE 68114 Taxpayer Identification Number: 35-2505499 Form(s): Dear Taxpayer: This letter is in response to your telephone inquiry of April 24th, 2014. Your Employer Identification Number (EIN) is 35-2505499. Please keep this number in your permanent records. You should enter your name and your EIN, exactly as shown above, on all business federal tax forms that require its use, and on any related correspondence documents. If you have any questions regarding this letter, please call our Customer Service Department at 1-800-829.0115 between the hours of 7:00 AM and 7:00 PM. If you prefer, you may write to us at the address shown at the top of the first page of this letter. When you write, please include a telephone number where you may be reached and the best time to call. Sincerely, Bree Keyes 0441875637 Customer Service Representative STATE OF NEBRASKA United States of America, } ss. Secretary of State State of Nebraska } State Capitol Lincoln, Nebraska I, John A. Gale, Secretary of State of the State of Nebraska, do hereby certify that 4001. FARNAM LLC a limited liability company duly formed under the laws of this state on March 26, 2014, has paid all applicable fees, taxes and penalties to the Secretary of State; the most recent biennial report required has been filed; the company has not delivered to the Secretary of State a statement of dissolution or termination or been administratively dissolved by the Secretary of State and said limited liability company is in existence as of this date. This certificate is not to be construed as an endorsement, recommendation, or notice of approval of the entity's financial condition or business activities and practices. In Testimony Whereof, _ I have hereunto set my hand and � '° �� affixed the Great Seal of the %�'� �n, „T�`1 T �1 � State of Nebraska on this date of % � 9 � i ,� 0���g�� June 1$, 2014. .,y E. ttt22 y3�-.1 i�' - �y��-A B p/ /�\fJ�r W 9 „ ,�r 4 �1 , �, 1VVJ . ,,te.(________ ,� r�l ®a Secretary of State i�t � ,� 1'i ,04 q AY-v�*� kii is_! % IN WITNESS WHEREOF, the parties have entered into this Agreement effective as of the Effective Date, MANAGER: GREENSLATE DEVELOPMENT,LLC By: -- Name:Name: Matt Dwyer Title: Manager By: Nanny Lon Ti e: Manager MEMBERS: GREENSLATE DEVELOPMENT, LLC By: Name: Matt wyer Title: Manager By: Nam y Lund • anager ram. Dan Smith S, 1 Joe Stessman / V/I# Ra Y se 689742/4/PHOEN IX SUMMARY APPRAISAL REPORT q ,g � 0 4 m� ir k a � • 4001 Farnam Street 4004 Harney Street TWO COMMERCIAL BUILDINGS LOCATED AT 4001 FARNAM STREET AND 4004 HARNEY STREET OMAHA,NEBRASKA 68131 AS OF MARCH 18, 2014 PREPARED FOR MR. PATRICK ZACH VICE PRESIDENT DUNDEE BANK, A BRANCH OF SECURITY STATE BANK 5015 UNDERWOOD AVENUE OMAHA,NE 68132 PREPARED BY DENNIS J.KNUDSON,MAI KNUDSON APPRAISAL SERVICES 1011 SOUTH 78TH STREET OMAHA,NE 68114-5470 KNUDSON APPRAISAL SERVICES 1011 South 78th Street Omaha,Nebraska 68114 Telephone(402)397-2280 April 7, 2014 Mr. Patrick Zach Vice President Dundee Bank, A Branch of Security State Bank 5015 Underwood Avenue Omaha,Ne 68132 RE: Summary Appraisal Report Two Commercial Properties 4001Farnam Street and 4004 Harney Street Omaha,NE 68131 Dear Mr.Zach: In accordance with your request, I have prepared a summary narrative appraisal report on the above captioned property. The purpose of this report is to provide a supported opinion of the market value of the subject property. This report is prepared in accordance with the Code of Professional Ethics and the Guidelines for Real Estate Appraisal Policies and Review Procedures adopted by the bank supervision offices of the Federal Reserve System as of August 9, 1990 and the Office of the Comptroller of Currency as of August 23, 1990.The report also complies with USPAP and 12 CFR Part 564 and Thrift Bulletin 55a (interagency Appraisal and Evaluation guidelines) and the Code of Professional Ethics and the Standards of the Professional Appraisal Practice of the Appraisal Institute. As a result of my analysis of the factors influencing this valuation, it is my opinion that the market value of the subject two parcels, subject to my underlying assumptions and limiting conditions and my certification, as of March 18, 2014, is as follows: "As Is" Value ONE MILLION THIRTY-FIVE THOUSAND DOLLARS ---($1,035,000) --- Mr. Patrick Zach Dundee Bank Page -2- "As Renovated"Value Parcel 1 —4001 Farnam Street NINE HUNDRED TWENTY-FIVE THOUSAND DOLLARS -- - ($925,000) --- Parcel 2—4004 Harney Street ONE MILLION FOUR HUNDRED THOUSAND DOLLARS --- ($1,400,000)--- TOTAL VALUE"AS RENOVATED" 4001 Farnam Street and 4004 Harney Street TWO MILLION THREE HUNDRED TWENTY-FIVE THOUSAND DOLLARS - --($2,325,000) --- My narrative summary appraisal report that follows sets forth the identification of the property, property rights appraised,assumptions and limiting conditions,pertinent facts about the subject's area and the subject property, comparable data,results of my investigation and analyses,and the reasoning leading to the conclusion set forth. The Appraisal Institute conducts a voluntary program of continuing education for its designated members. MAIs and SRAs who meet the minimum of standards of this program are awarded periodic educational certification. I am currently certified under this program. Sincerely, Dennis J. udson, NLAI Nebraska General Certified Appraiser CG920136 C-25A CITY OF OMAHA LEGISLATIVE CHAMBER Omaha,Nebraska RESOLVED BY THE CITY COUNCIL OF THE CITY OF OMAHA: WHEREAS, the primary objectives of the City of Omaha's Master Plan and Community Development Program are to encourage additional private investment and infill development within inner-city neighborhoods; and to eliminate conditions which are detrimental to public health, safety and welfare, by developing vacant, underutilized property within these neighborhoods; and, WHEREAS, the redevelopment project site located southwest of 40th and Farnam Streets is within a designated community redevelopment area, as the area meets the definition of blight and substandard per the Community Development Law and is in need of redevelopment; and, WHEREAS, this 40 Harney-Farnam Tax Increment Financing (TIF) Redevelopment Project Plan for the redevelopment project site was approved by the TIF Committee and subsequently by the City of Omaha Planning Board at their August 6, 2014 meeting; and, WHEREAS, the project site for the 40 Harney-Farnam Tax Increment Financing (TIF) Redevelopment Project Plan is located southwest of 40th and Farnam Streets and is legally described in Exhibit"A" which is attached hereto and herein incorporated by reference; and, WHEREAS, the 40 Harney-Farnam Tax Increment Financing (TIF) Redevelopment Project Plan proposes the rehabilitation of the commercial structure located at 4001 Farnam Street and restoring the multi-family structure located at 4004 Harney Street to its original number of 6 units from the current 12 units as described in Exhibit "B", attached hereto and herein incorporated by reference; and, WHEREAS, this Resolution seeks approval of 40 Harney-Farnam Tax Increment Financing (TIF) Redevelopment Project Plan recommends the City's participation through the allocation of TIF in an amount up to $184,500.00 to offset TIF eligible costs such as acquisition, rehabilitation costs, landscape sidewalk repair, architectural and engineering fees, and any public improvements, as may be required, which includes $15,000.00 of the TIF proceeds/loan toward Midtown Public Improvement Fund to be used for the Farnam Street two-way conversion, for a project with total estimated costs of$2,234,150.00; and, By Councilmember Adopted • City Clerk Approved Mayor NO. Resolution by :fra 4.• Presented to City Council ettitOr erotun City Clerk C-25A CITY OF OMAHA LEGISLATIVE CHAMBER `" Omaha,Nebraska t Page 2 , , WHEREAS, the Plan presents a project based on estimated figti es acid projections that are subject to change as project costs are finalized, and is required tocompy with all Planning Department requirements and Planning Board recommendations-,,andr 4 WHEREAS, Section 18-2108 of the Nebraska Revised Statutes requires the City of Omaha to adopt a redevelopment plan before taking an active part in a redevelopment project; including the division of ad valorem taxes for a period not to exceed fifteen years under Sections 18-2147 through 18-2150, Revised Statutes of Nebraska; and, NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF OMAHA: THAT, the attached 40 Harney-Farnam Tax Increment Financing (TIF) Redevelopment Project Plan located southwest of 40th and Farnam Streets which proposes the rehabilitation of the commercial structure located at 4001 Farnam Street and restoring the multi- family structure located at 4004 Harney Street to its original number of 6 units from the current number of 12 units recommends the City's participation through the allocation of TIF in an amount up to $184,500.00 to offset TIF eligible costs such as acquisition, rehabilitation costs, landscape sidewalk repair, architectural and engineering fees, and any public improvements, as may be required, which includes $15,000.00 of the TIF proceeds/loan toward Midtown Public Improvement Fund to be used for the Farnam Street two-way conversion; containing a provision for the division of ad valorem taxes under Section 18-2147 through 18-2150, Revised Statutes of Nebraska, as recommended by the City Planning Department, be and hereby is approved. APPROVED AS TO FORM: spA CI AT EY71(-- T y 2064 dlh B Y ,o pet.a.... Councilmember Adopted EP 1 6 2014 .._ © - /j�c2<S' ' � ' ���Q7i/?�`u� x ,�Yil I�® /�i' Goy adei...„ �t CI rk Approv Mayor ././y/e,,WA.Z1 NO. �t� � ........., Resolution by Res. that, the attached 40 Harney-Farnam Tax recommended by the City Planning Increment Financing (TIF) Redevelopment Department, be and hereby is approved. Project Plan located southwest of 40th and Farnam Streets which proposes the 2064 dlh rehabilitation of the commercial structure located at 4001 Farnam Street and restoring the multi-family structure located at 4004 Harney Street to its original number of 6 units from the current number of 12 units recommends the City's participation through the allocation of TIF in an amount up to $184,500.00 to offset TIF eligible costs such as acquisition, rehabilitation costs, landscape sidewalk repair, architectural and engineering fees, and any public improvements, as may be required, which includes $15,000.00 of the TIF proceeds/loan toward Midtown Public Improvement Fund to be used for the Farnam Street two-way conversion; containing a provision for the division of ad valorem taxes under Section 18-2147 through 18-2150, Revised Statutes of Nebraska, as Presented to City Council AUG 2 62014 °3 �i �, f l' i i ? cri, i ) /e4e1 el/-1 r411/L 1 %E /1; SEP 1 6 2014 - Adopted guiler grown )4.-56 -Az-Z-,2Z4, City Clerk