Pilot Increment Financing for the Barilla attraction project

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Pilot Increment Financing for the Barilla
attraction project

• Presentation to Upstate Conversations Conference
• March 23, 2007

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BARILLA

• Competition for the 2nd North American
  manufacturing plant and distribution center
• Barilla worldwide and US market leader in pasta
• 96 million, 310,000 sf. 120 jobs, family-owned
• 54 sites in 13 states

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Photo rendering
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The Criteria

• a build-ready site, 115kv redundant power,
  significant gas, on-site rail, near Interstate
• Empire Zone
• Ability to be operational in June, 2007

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The before site
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The Infrastructure Project

• Purchase 49 acre site
• Create 12 acre detention facility
• Construct 3,190 feet of roads, water, sewer,
  street lighting and sidewalks
• Construct 1,275 railroad siding including road
  crossing
• Relocate six 69Kv lines and other utility
  structures

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The Project Costs

• 493,000 Land
• 2,600,000 Roads, Lighting and Drainage
• 300,000 Railroad
• TOTAL 3,400,000

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Construction
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Construction (continued)
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Construction (continued)
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Revenues

• 907,000 NYSDOT IAP Loan/Grant
• 100,000 National Grid Shovel Ready ED Grant
• 300,000 NYSDOT Multi Modal Grant
• 493,000 Barilla held note
• TOTAL Outside Revenue - 1.8 million

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Financing Components

• Infrastructure Debt Service
• NYSDOT IAP Loan
• Tax Stabilization Fund
• Distribution to Taxing Entities

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PILOT Revenue for Financing

• Assessment 13,807,000 in year 2 to be increased
  by change of level factor (CLF)
• CLF the average change in assessed values
  townwide in any assessment update
• 580,000 first year tax revenue

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PILOT Financing Use of Receipts of 580,000

• 235,000 Infrastructure Debt Service
• 36,300 IAP Debt Service
• 68,500 Tax Stabilization Fund Land
• 225,000 Tax Stabilization Fund
• TOTAL FINANCING COST 564,000
• 16,000 available to taxing entities

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PILOT Financing Terms

• All Payments over ten year period to coincide
  with Empire Zone 10 year 100 Real Property Tax
  Credit
• Communities get 100 full value taxes in year 11
  and thereafter
• Barilla, through tax stabilization fund, does not
  pay full taxes until year 21

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Summary principals of PILOT Increment Financing

• Requires Empire Zone
• Requires uniform agreement of taxing entities to
  redirect PILOT revenues to debt service for
  improvements
• Requires IDA to be developer may need trustee
• Need municipality for dedication