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Airlite Plastics Co. TIF PlanCity of Omaha Hal Daub, Mayor Honorable President r{, E l,-. r: 11 \ / I 'l -J -~ 1..) 99 JUL 12 r·: !~: c J Ci' T Y ~:· : .,~-. ~ i ~ !· '.,f ' • ' July 13, 1999 and Members of the City Council, Planning Department Omaha/Douglas Civic Center 1819 Farnam Street, Suite 1100 Omaha, Nebraska 68183-0110 (402) 444-5200 (402) 444-5150 Telefax (402) 444-6140 Robert C. Peters Acting Director The attached proposed Resolution approves the Airlite Plastic Company Redevelopment Plan for the construction of a 330,000 square foot manufacturing and office complex to be located at Lindberg Drive and the Storz Expressway. Growth of the company has facilitated the need to expand its manufacturing and office operations, resulting in the proposed construction of the new facility. The total estimated project cost is approximately $20,753,200.00 with the construction costs estimated to be approximately $18,293,581.00. The facility will include parking areas, truck loading and dock areas and a railroad spur track and loading area. The proposed TIF will be used to cover site preparation, storm runoff and detention, wetland mitigation, traffic alterations and other special requirements due to site soil conditions. The proposed TIF amount is approximately $2,201,000.00, which is approximately 11 % of the total project costs. The TIF will be repaid through the increase in ad valorem taxes over the amortization period as established by state law. The project meets all of the relevant requirements for consideration. The project is located in a blighted area, at least 51 % of the jobs created will be held by and available to low and moderate income people, the site is substandard and blighted based on existing conditions, the site is a vacant and undeveloped parcel with a significant portion of the site being unplatted, having poor drainage, poor soils and lacking adequate accessibility. In addition, there are significant wetlands improvements required as a condition of approval of this request. Honorable President and Members of the City Council Page2 The Redevelopment Plan is in conformance with the goals of the City of Omaha to support economic development and private sector business reinvestment. The plan conforms with the goals of the Community Development Master Plan and the Urban Development Policy of the City, as well as the Airport Business Park Redevelopment Area Plan. Your favorable consideration of this Resolution will be appreciated. Sincerely, Date Approved as to Funding: Don Elliott, P .E. Public Works Director Approved: ~~kr Kellie Paris I 1/f~rl Date Finance Director P:\PLN3\4613.PJM Notice of Public Hearing: Notice of Publication: Human Relations Director July 15, and July 22, 1999 August 3, 1999 CD G)' I T- l ..,I c: Q) E .c (.) ca ... <( AP.R 28 '99 12=01PM THE SCHEMMER P.SSOC - .1 P. ,... 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"' 0 er ... a: ~ !)'. ...; § g .. • j ~'i Ii j'i' I:''-ci sJh I! ii "1 p Z00-2111-tt7 IDOIJ t Int,~ en m 9~ "c: IJJ ~~ ~ "'-::D "';: 0 ..... ~-. &' ct-.... :g ... ;D "''J> ~I.: ~ .. ~ "'Ii: .. ·~ ao C::· ~ ,, .,, ";J) Iii ..., I\: ., ,, :t: -:z ~ "1; ~ '."' "' ~ c 0 .. c 0 :c 0 r s: +>-0 I\) (J.) w Q) CJ) [\} r.u w . . 0 °' --0 I\) --co co I\) )> s: ~ ~ -..J ~ w .. "U ID <Cl m I\) --w :;~~, I' I ,.I: I~ i,• ·I I 'i 1 I 1t)I till' -. <llJ .jJ N Ir c :r;I ~ 'tJ~I' l) 11" c • I : : ·.~.11 -<, .l(;j •, '~11 ' ii.I >llj tj) .11 ''. :.::11 1 , ~ ri· I' ·".'I ·"1 ,i,I )> -· .., --· ,... (1) '"'C -Q) :::s AIRLITE PLASTICS COMPANY REDEVELOPMENT PLAN Lindberg Drive & Storz Expressway This project as proposed by Airlite Plastics Company will provide office, manufacturing, warehousing and distribution facilities built to suit the expanded needs of the company. This $20,753,200 project will develop vacant property in the Airport Business Park. The project site is in a General Industrial District (GI) suitable for manufacturing, warehousing and distribution activity. The project includes site preparation and construction of a 330,000 square foot building with truck delivery docks, rail spur, landscaping and other improvements to complement the expanded operational complex. As an adjunct to this construction project, a portion of the Tax Increment Financing would be applied to the cost of the storm sewer detention pond, traffic improvements and wetlands mitigation. The building of the detention pond is an element of the public infrastructure that makes this industrial area suitable for development. To facilitate the land acquisition for the mitigation of the wetlands and to acquire land for the rail spur extension, the company is requesting the approval of the use of eminent domain should the need arise. The firm is in negotiations to acquire the required property through normal channels. With the approval of approximately $2,201,000 in Tax Increment Financing approximately $1,501,000 will be allotted to Airlite Plastics Company for site preparation costs with approximately $700,000 for infrastructure development costs. The $2,201,000 in TIF financing as a portion of the $20,753,200 total project cost will make this project feasible. Other financing including private financing and developer's equity are committed. The TIF will be retired over 15 years. Excess ad valorem taxes resulting from the development would produce approximately $316,362 per year. The developer will be responsible for the entire construction project including the installation of gas, water, electricity and sewer suitable for the proposed use. Construction at the project site is expected to begin in 1999 and be completed by June 1, 2001. The attached maps show the project location and site plan of the redevelopment project. The excess ad valorem taxes from this project will be computed from the base tax value assessed on this site for the year prior to the passage of this Redevelopment Plan. History The firm increased employment by 150 employees over the last three years and has averaged from 30 to 50 employees per year. They expect to average 15 to 20 employees per year over the next 5 years. Airlite currently employs over 500 workers to produce printed plastic tubs and lids for the dairy, salad and margarine industries. Airlite was originally started in 1946 in a building near 16th and Locust. In the late 1960's Airlite moved to its current location at 18th and Cuming. Since then, Airlite added a satellite facility in the Millard area, which was eventually eliminated when they expanded at their current location. In 1988, Airlite purchased land at 14th and California and built an automated high-rise warehouse in 1989. Three years later, that facility was expanded and the printing operation was moved from 18th and Cuming to the warehouse. Since 1970, Airlite has added an average of 15 new positions per year. In the last 24 months, over 100 manufacturing positions have been added. The manufacturing jobs are split roughly 50-50 between molding operations and printing operations. All of these changes have allowed Airlite to gradually grow by providing quality goods and services at highly competitive prices. Airlite is once again running out of room to expand its operations. They have already filled every machine location in their newest molding room. The print machines that are on order will virtually fill the current print shop. Over the winter, they finished the basement at 14th and California as additional warehouse space. This is the last addition that can be made to the current warehouse. If Airlite is to continue to grow and compete in this competitive market, new manufacturing space must be developed. In addition to the outright need for manufacturing space, Airlite also seeks to improve operating efficiencies. The packaging market is extremely competitive. Many of Airlite's competitors have merged to form large companies. To compete against these companies, Airlite must maximize operational efficiencies. The current plant layout is not efficient due to the simple fact that the molding and printing operations are in two completely separate facilities located a quarter mile apart. The new facility under consideration would alleviate this situation by combining these operations, thus maximizing operational efficiencies. Construction of a new facility is paramount to the company. This new facility will put Airlite in a strong position to keep its current market share secure and to maximize growth potential for many years in the future. PROJECT DESCRIPTION Airlite Plastics proposes to purchase and improve this site with the construction of a facility to meet their expanding office, manufacturing, warehousing and distribution needs. Airlite Plastics desires to locate in a new facility in East Omaha rather than move to another part of the City. The firm made this decision to move to the proposed location after an analysis of the expansion opportunities at their present site. The company wanted to expand at their present location, however, because of the shortage of adequate buildable area to expand into, the opportunity does not exists. Airlite has considered locations within a 20-mile radius of its current facility. They believe that the Riverfront Industrial area will serve their needs so long as TIF funds are available to help compensate for increased development expenses necessitated by 2 this site which would not be present in other sites that Airlite could purchase and develop at a lower cost. The proposed project site is vacant at this time and will require grading, excavation and the installation of suitable utilities on the site. Tax Increment Financing can be used for the cost of preparing the land and other eligible cost to develop the detention cell, wetland mitigation and other public improvements that may be required. Preliminary design plans for the storm sewer, detention pond, traffic improvements and wetlands have not been completed. A preliminary estimate indicates that the construction cost for the detention cell, necessary storm sewer network, traffic improvements and wetlands mitigation will be approximately $700,000. A portion of the TIF approved in this redevelopment plan will be applied to the cost of these improvements. The amount of the TIF dedicated for public improvement cost related to this project may increase based on final cost estimates. DEVELOPMENT FINANCING PLAN SUMMARY Bank Financing TIF Financing Developer Equity TOTAL $16,092,581 $ 2,201,000 $ 2,459,619 $20,753,200 77% 11% 12% Permanent financing at 7% for a term of 20 years fixed TIF financing at 7.75% for 15 years. Cost Benefit Analysis 1) The use of Tax Increment Financing will not result in tax shifts. The current level of taxes will continue to flow to the current taxing entities and only the increased value of revenues resulting from the improvements will be applied to the cost of the improvement; 2) No community public service needs will be generated as a result of this project. The TIF proposed will be used to offset public infrastructure improvement cost including wetlands mitigation. The expansion will increase the level of truck traffic above that which currently exist in this industrial area. The industrial capacity of the infrastructure is more than adequate to serve the increased demands. ; 3) this expansion project will not significantly impact other industries in the area except to increase demand for construction and any manufacturing supplies that are locally procured; 4)the expansion at this site rather than moving to a green field site will maintain and add new jobs in eastern part of the City UTILITIES AND TRANSPORTATION Gas, water, electrical and sewer services suitable to the proposed use will be installed by the developer. Truck access to the site will be from Abbott and/or 3 Lindbergh Drive based on final recommendations from the Public Works Department. The site is convenient to air transport facilities. A rail spur will be extended to satisfy the needs of the firm on the north side of the site. LAND USE/ZONING This site is located in a General Industrial District with abutting properties that are also zoned for General Industrial use. The proposed manufacturing, warehousing, distribution and office complex is in compliance with the proposed Land Use Plan and Master Plan for this area. The proposed development will comply with the site development regulations for GI use as follows: Lot area .............................................. 10,000 square feet minimum Lot width ............................................. 100 feet minimum Floor area ratio ................................... 2.0 Maximum Front yard (minimum) ......................... 50 feet from the center line of the fronting street Street side yard .................................. Lesser of 10 feet or 50 feet from the center line of the fronting street Interior side year ................................. No requirement Rear yard frontage ............................. 10 feet minimum on lots without alley No requirement along alley Height ................................................. 120 feet maximum; 45 feet maximum where building is within 100 feet of an R6 or lower intensity district Building coverage ............................... 90 percent maximum Impervious coverage .......................... 90 percent maximum BLIGHT AND SUBSTANDARD CONDITIONS The property is located in an area of North Omaha previously designated as blighted and substandard. The site is located in a census tract that has an unemployment level at 124.17% of the state average. The average age of housing or commercial units in the tract is 58 years. Per capita income is $8,207 lower than the per capita income of the municipality as a whole. This industrial park is in a low lying area that has water table problems which require that special infrastructure and site preparation construction techniques to be utilized in order to make the site suitable for development. The effective utilization of this vacant property will eliminate the potential of illegal dumping or other hazardous uses. 4 C-25A. CITY OF OMAHA LEGISLATIVE CHAMBER July 13 99 Omaha, Nebr .................................................................... 19 .......... . 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 approximately 29-acre Airlite Plastic Company Redevelopment Area, is located at Lindberg Drive and Storz Expressway, (see Attachment 1 for complete legal description); and, WHEREAS, this Redevelopment Plan is located within an area previously declared "blighted and substandard and in need of redevelopment" by City Council Resolution No. 2555, approved September 28, 1975 and Resolution No. 1528, approved June 4, 1985. The project area was recertified as blighted and substandard in June of 1992 and June of 1993; and, WHEREAS, Airlite Plastic Company Redevelopment Plan proposes the rehabilitation of the site through the development of a 330,000 square foot manufacturing and office complex, as described in Exhibit "A", attached hereto and made a part hereof; and, WHEREAS, the Airlite Plastic Company Redevelopment Plan provides for the use of Tax Increment Financing to fund the cost of traffic improvements, wetlands mitigation, detention cell development and site specific development costs to develop the project based on poor soil conditions; and, WHEREAS, an Industrial Development Bond issue may be used in this blighted and substandard area to assist with project financing; and, WHEREAS, Section 18-2108 of the Nebraska Revised Statues 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 under Sections 18-2147 through 18-2150, Revised Statutes of Nebraska; and, By ........................................................................................ . Councilmember Adopted ......................................................................... . City Clerk Approved .............................................................. . Mayor * () 0 :::: ::::1 0 z Q "NOTICE TO.PUBLIC" NOTICE OF PUBLIC HEARING ON THE AIRLITE PLASTIC COMPANY REDEVEl.OPMENT PLAN Notice is hereby given that the Om ah a City Council has set Tuesday, Au9!1St 3, 1999 at 2:00 o'clock P.M. lis th&· date of Public Hearing on the Airlitll.f• ~astic Company Redevelopment lllan. ,: -.·:.. The proposed plan proposes ior the construction and development of. a 330,000 square foot manufacturing efid; ·office complex to be located at the Lindberg. Drive & Storz Expressway .. A CQPY.. of said plan is available for public ir.spectipn. in" the City Clerk's Office. Public Hearing will be hetdbefore the City Council of the City of Omah.a. in the Legislative Chambers, Omaha/Douglas Civic Center, 1819 Farria"'! :. Street, Omaha, Nebraska. • · • ' ' BUSTER BROWN, City Clerk THE DAILY RECORD OF OMAHA RONALD A HENNINGSEN, Publisher PROOF OF PUBLICATION UNITED STATES OF AMERICA, } 11te State of Nebl'Mka, District of Nebnl8ka, ss. fumty of Douglas, City of Omaha, JOHN P. EGLSAER being duly sworn, deposes and says that he ls ADVERTISING MANAGER of THE DAILY RECORD, of Omaha, a legal newspaper, printed and published daily in the English language, having a bona fide paid circulation in Douglas County in excess of 300 copies, printed In Omaha, in said County of Douglas, for more than fifty-two weeks la.st past; that the printed notice hereto attached was published In THE DAILY RECORD, of Omaha, on ............................................. . July 15 and 22, 1999 That said Newspaper during that time was regularly published and in general circulation in the County of Douglas, and State of ::~:::~ $ ... zg .• JS.. . ..... Sribed~ ... ln .. my .. /'·p· --~\n··· ~an. d··s·······to······ Additional O>ples . . . . . . . . . . . . . . ~ ::;:~:~ # ........ s ... Z9,>L ..,..._°';·i~ )22nd 9 .... , ... ~;~~: CITY OF OMAHA LEGISLATIVE CHAMBER Omaha, Nebr. ....... ..:!\tJY .. J.~ ............................................ 19 .. }.~ ... . PAGE2 WHEREAS, the Airlite Plastic Company Redevelopment Plan was approved by the City of Omaha Planning Board on June 2, 1999. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF OMAHA: THAT, the attached Airlite Plastic Company Redevelopment Plan, prepared by the Omaha City Planning Department, containing a provision for the division of ad valorem taxes under Section 18-2147 through 18-2150, Revised Statutes of Nebraska, be and hereby is approved as the Redevelopment Plan for Airlite Plastic Company Redevelopment Area, located at Lindberg Drive and Storz Expressway. P:\PLN3\4614.PJM (;)~ c:J. 7(~ By ........................................................................................ . Councilmember APPROVED AS TO FORM: ~ /<?' , >d , ~~,&El- "/:1{'f-NO ........ -:2///. ............ . Resolution by ................................................... . Res. that the attached Airlite Plastic Company Redevelopment Plan, prepared by the Omaha City Planning Department, containing a provision for the division of ad valorem taxes under Section 18-2147 through 18-2150, Revised Statutes of Nebraska, be and hereby is approved as the Redevelopment Plan for Airlite Plastic Company Redevelopment Area, located at Lindberg Drive and Storz Expressway. P:\PLN3\4614.PJM Presented to City Council JUL 1 3 1999 . ...J . ., .... ·.· ·~: ... ·; ..... "jF "j" ... .;2 )}o. ,;}., /' :r-=/?1:lf~t:A.e/· _, Jiee.,,<.._;1 z::-c: ~1',, 1 . · -"· ,•I I. I. . . '.)·~I/, · .. · · · ' 1 " ' ;: -'' . ,. 1 ;// / .. ~ ,., ·'"''1:-6</. ... 12/.. .. 2::':17Zf· . ..1.::t.1.0/ .. " ... _~a~.-~·.. . ._ ........ . /A /?. ~.·. ~ • / r_,~• ; -"°'-;;_ . ~cd/1~/ '''JL). r AUG . .3 ...... 1999. ~: ........ MQP..te.d ..... :?. .. :<:?. ........ . Bu6fer Brown City Clerk ,. \ ',·