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<br /> Draft Memorandum July 25, 2013
<br /> EPSP Infrastructure Feasibility Analysis Page 7
<br /> Table 4 — Cost/Value Ratio and Tax Burden Feasibility Summary (adjusted building
<br /> values)
<br /> Option
<br /> Item 1 4 5 6
<br /> Cost/Value Ratio Test
<br /> Infrastructure Costs(rounded)
<br /> Backbone Infrastructure $61,471,000 $63,312,000 $61,138,000 $62,087,000
<br /> Off-Site Utility Improvements' $5,000,000 $5,000,000 $5,000,000 $5,000,000
<br /> Potential Relocation of OSC and TS $10,000,000 $0 $10,000,000 $10,000,000
<br /> Fees and Connection Charges' $115,587,450 $143,241,954 $134,887,864 $186,124,558
<br /> Total Infrastructure Cost Burden $192,058,450 $211,553,954 $211,025,864 $263,211,558
<br /> Development Value $878,807,000 $845,272,000 $1,010,055,000 $1,441,205,000
<br /> Infrastructure Cost/Value Ratio 21.9% 25.0% 20.9% 18.3%
<br /> Tax Burden Threshold Ten
<br /> CFD Bond Proceeds and Issuance Cost' $69,794,550 $71,727,600 $69,444,900 $70,441,350
<br /> Proceeds Required for Annual Debt Service° $6,334,302 $6,509,738 $6,302,569 $6,393,003
<br /> Debt Coverage Factor 120% 120% 120% 120%
<br /> Special Tax Revenue Required(Annual) $7,601,162 $7,811,686 $7,563,083 $7,671,604
<br /> Potential Special Tax(%of Development Value) 0.86% 0.92% 0.75% 0.53%
<br /> 'Reflects a conservative"place-holder"assumption of$4 million to cover any upgrades to recycled water exchange program to attain required
<br /> water supply and$1 million to cover Stanley Boulevard frontage cost to County and any additional off-site improvements that may be necessary.
<br /> ° Include water,wastewater,impervious surface,public facilities,traffic development,Tri-Valley Transportation Committee, school,park dedication,
<br /> and 615 fees based on the City's January 2013 fee schedule.
<br /> 'Assumes a Community Facilities District bond(CFD)is used to cover backbone and off-site infrastructure,but not fees(bond issuance costs
<br /> assumed at 5 percent of bond value).
<br /> °Assumes an Interest rate 6.5%for a 20-year term.
<br /> Source: Kier&Wright Civil Engineers Surveyors and EPS.
<br /> Feasibility Considerations
<br /> While this analysis provides a number of feasibility measures for the EPSP development options,
<br /> there are still unresolved factors that will affect development feasibility of new growth. These
<br /> key factors are described below.
<br /> Inclusionary Housing Requirements
<br /> This analysis assumes that the Project will meet its inclusionary requirement of 20 percent of for-
<br /> sale units and 15 percent of rental units based on the City's existing affordable housing policy.
<br /> All inclusionary units are assumed to be accommodated in the high density product type.
<br /> Inclusionary housing requirements have substantial impacts on land values and have historically
<br /> varied for developments in the City. To the extent that lower density product types would be
<br /> responsible for their respective share of inclusionary housing, development feasibility of the
<br /> Project would be weakened.
<br /> For illustrative purposes of bracketing a range of potential outcomes, EPS evaluated residential
<br /> land values for each residential product type under the existing inclusionary housing fee as well
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