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HomeMy Public PortalAboutORD15259 SUBSTITUTE BILL NO.: 2014-4 SPONSORED BY COUNCILMAN Schulte ORDINANCE NO.: 15259 AN ORDINANCE OF THE CITY OF JEFFERSON, MISSOURI, AUTHORIZING THE MAYOR TO ENTER INTO A COOPERATIVE AGREEMENT WITH THE CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT FOR FUNDING AND FINANCING OF COMMUNITY IMPROVEMENT DISTRICT IMPROVEMENTS IN RELATION TO THE CAPITAL MALL TIF REDEVELOPMENT PLAN AND CONTRACT. WHEREAS, the Capital Mall Redevelopment Plan ("TIF Plan") and the Tax Increment Financing Contract between the City and Capital Mall JC, LLC, for the implementation of the TIF Plan ("TIF Contract") contemplate the establishment of a community improvement district to impose a CID sales tax to provide a source of funds to repay certain costs of redevelopment; and WHEREAS, on January 21, 2014, the City Council adopted Ordinance No. 15223, pursuant to which the City approved the Petition to Establish the Capital Mall Community Improvement District (the "Petition"), which was filed by Capital Mall JC, LLC (the "Developer"), and established the Capital Mall Community Improvement District (the "District") for the purposes set forth in the Petition by using the revenue generated from a CID sales tax on sales in the District (as described in the Petition); and WHEREAS, the TIF Contract requires the City and the Developer to cause the Community Improvement District's Board of Directors to enter into a contract with the City with regard to the operation and management of the District and the use of CID Sales Tax revenues; and WHEREAS, the City and the District desire to enter into the Cooperative Agreement attached hereto to satisfy the aforementioned requirements of the TIF Contract. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF JEFFERSON, MISSOURI, AS FOLLOWS: Section 1: The Cooperative Agreement among the City of Jefferson, Missouri, the Capital Mall Community Improvement District, and Capital Mall JC, LLC, ("Cooperative Agreement") a copy of which is attached hereto as Exhibit A, is hereby approved and adopted. Section 2: The City Council hereby finds that the improvements contemplated under the cooperative agreement are reasonably anticipated to remediate the blighting conditions and will serve a public purpose pursuant to section 67.1461.2(2), RSMo. 2014-4 1 SUBSTITUTE Section 3: The Mayor is authorized to execute the Cooperative Agreement for and on behalf of the City of Jefferson. Section 4: If any section, subsection, sentence, clause, phrase, or portion of this Ordinance is for any reason held invalid or unconstitutional by any court of competent jurisdiction, such portion shall be deemed a separate, distinct, and independent provision, and such holding shall not affect the validity of the remaining portions thereof. Section 5: This ordinance shall be in full force and effect from and after its passage by the City Council and approval by the Mayor according to law. Passed by the City Council this day of 2014. Eric J. Struemph, ayor ATTEST; - APPROVED AS TO FORM: Ci Counselor - 1st reading ri / 2nd reading Y 1 / 2014-4 2 SUBSTITUTE EXHIBIT A COOPERATIVE AGREEMENT 2014-4 3 COOPERATIVE AGREEMENT by and between the CITY OF JEFFERSON,MISSOURI, and the CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT, dated as of , 2014 47691781.2 COOPERATIVE AGREEMENT THIS COOPERATIVE AGREEMENT ("Agreement"), entered into as of this day of , 2014, by and between the CITY OF JEFFERSON, MISSOURI, a political subdivision of the State of Missouri (the "City"), the CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT, a community improvement district and political subdivision of the State of Missouri ("District' or "CID"), with the City and the District being sometimes collectively referred to herein as the "Parties", and individually as a "Party." ty. WITNESSETH: WHEREAS, on October 28, 2013, the Tax Increment Financing Commission of Jefferson City, Missouri held a public hearing and voted on its recommendations to the City Council regarding the Capital Mall Tax Increment Financing Plan (the "Redevelopment Plan"), which included one redevelopment project (the "Redevelopment Project') WHEREAS, on January 21, 2014, by ordinance No. 15222, the City Council of the City of Jefferson, Missouri (the "City Council") approved the Redevelopment Plan, determined that the Redevelopment Area is a Blighted Area and that it met the other applicable requirements of the Real Property Tax Increment Allocation Redevelopment Act, Section 99.800, et seq., RSMo, as amended (the "TIF Act'), selected Developer to implement the Redevelopment Plan, and authorized City to enter into a contract with Developer for the implementation of the Redevelopment Project described in the Redevelopment Plan (collectively, the "Capital Mall TIF"); WHEREAS, on January 21, 2014, the City Council passed Ordinance No. 15223, a copy of which is attached hereto as Exhibit A, which approved the formation of the District and the Petition to Establish the Capital Mall Community Improvement District (the "Petition"), a copy of which is attached hereto as Exhibit B; and WHEREAS, the District is authorized under the Missouri Community Improvement District Act, as set forth in RSMo. §67.1401 et seq. (the "CID Act'), to impose a district-wide sales tax (the "District Sales Tax"), the revenues of which will be utilized to pay the costs of certain improvements, services, operation costs and formation costs, as further described herein; WHEREAS, the Parties have determined that the construction of the improvements contemplated herein will be to their mutual benefit and to the benefit of the public; and WHEREAS, the Parties desire to set forth through this Agreement their respective duties and obligations with respect to the operations of the District and the construction and payment for certain improvements within the District. NOW, THEREFORE, for and in consideration of the premises, and the mutual covenants herein contained, the Parties agree as follows: 47691781.2 ARTICLE 1: DEFINITIONS, RECITALS,AND EXHIBITS Section 1.1. Recitals and Exhibits. The representations, covenants, and recitations set forth in the foregoing recitals attached to this Agreement are material to this Agreement and are incorporated herein by reference and made a part of this Agreement as though they were fully set forth in this Section. The Exhibits are material to this Agreement and are incorporated into each Section of this Agreement by reference to the Exhibit as though they were fully set forth in the referencing Section. Section 1.2 Definitions. In addition to words and terms defined by the Community Improvement District ("CID") Act, the following words and terms shall have the meanings ascribed to them in this Section 1.2. 1.2.2 "Applicable Laws and Requirements" means any applicable constitution, treaty, statute, rule, regulation, ordinance, order, directive, code, interpretation, judgment, decree, injunction, writ, determination, award, permit, license, authorization, directive, requirement, or decision of or agreement with or by any unit of government. 1.2.3 "City Council"means the governing body of the City. 1.2.4 "Board of Directors" means the governing body of the District described further in Section 3.4 below. 1.2.5 "CID Act" means the Missouri Community Improvement District Act, §§ 67.1401, et. seq, RSMo. 1.2.6 "Ordinance"means an ordinance enacted by the City Council. 1.2.7 "Tax Increment Financing Contract ("TIF Contract") means the Tax Increment Financing Contract between the City of Jefferson City, Missouri and Capital Mall JC, LLC for the Capital Mall Tax Increment Financing Plan, executed on , 2014, and any amendments thereto. ARTICLE 2: REPRESENTATIONS Section 2.1. Representations by the District. The District represents that: A. The District is a community improvement district and political subdivision, duly organized and existing under the laws of the State of Missouri, including particularly the CID Act. B. The District has authority to enter into this Agreement and to carry out its obligations under this Agreement. By proper action of its Board of Directors, the District has been duly authorized to execute and deliver this Agreement, acting by and through its duly authorized officers. 2 47691781.2 C. The execution and delivery of this Agreement, the consummation of the transactions contemplated by this Agreement, and the performance of or compliance with the terms and conditions of this Agreement by the District will not conflict with or result in a breach of any of the terms, conditions or provisions of, or constitute a default under, any mortgage, deed of trust, lease or any other restriction or any agreement or instrument to which the District is a party or by which it or any of its property is bound, or any order, rule or regulation of any court or governmental body applicable to the District or any of its property, or result in the creation or imposition of any prohibited lien, charge or encumbrance of any nature whatsoever upon any of the property or assets of the District under the terms of any instrument or agreement to which the District is a party. D. The District acknowledges that construction of the CID Improvements is of significant value to the District, its owners and tenants, potential users of the property within the District, and the general public. The District finds and determines that the CID Improvements will promote the economic welfare and the development of the City and the State of Missouri through: (i) the creation of temporary and permanent jobs; (ii) stimulating additional development in the area near the CID Improvements; (iii) increasing local and state tax revenues; and (iv) providing necessary infrastructure for the District and for other surrounding development. Further, the District finds that the CID Improvements conform to the requirements of the CID Act. E. There is no litigation or proceeding pending or threatened against the District affecting the right of the District to execute or deliver this Agreement or the ability of the District to comply with its obligations under this Agreement or which would materially adversely affect its financial condition. Section 2.2. Representations by the City. The City represents that: A. The City is duly organized and existing under the Constitution and laws of the State of Missouri. B. The City has authority to enter into this Agreement and to carry out its obligations under this Agreement, and the Mayor of the City is duly authorized to execute and deliver this Agreement. C. The execution and delivery of this Agreement, the consummation of the transactions contemplated by this Agreement, and the performance of or compliance with the terms and conditions of this Agreement by the City will not conflict with or result in a breach of any of the terms, conditions or provisions of, or constitute a default under, any mortgage, deed of trust, lease or any other restriction or any agreement or instrument to which the City is a party or by which it or any of its property is bound, or any order, rule or regulation of any court or governmental body applicable to the City or any of its property, or result in the creation or imposition of any prohibited lien, charge or encumbrance of any nature whatsoever upon any of the property or assets of the City under the terms of any instrument or agreement to which the City is a party. 3 47691781.2 D. The City acknowledges that construction of the CID Improvements (defined below) is of significant value to the City, its residents, and the general public. The City finds and determines that the CID Improvements will promote the economic welfare and the development of the City and the State of Missouri through: (i) the creation of temporary and permanent jobs; (ii) stimulating additional development in the area near the CID Improvements; (iii) increasing local and state tax revenues; and (iv) providing necessary infrastructure for the City, the District, and for other surrounding development. Further, the City finds that the CID Improvements conform to the requirements of the CID Act. E. There is no litigation or proceeding pending or threatened against the City affecting the right of the City to execute or deliver this Agreement or the ability of the City to comply with its obligations under this Agreement. ARTICLE 3: DISTRICT SALES TAX AND DISTRICT GOVERNANCE Section 3.1. Imposition of District Sales Tax. As contemplated in the Petition, the District's Board of Directors adopted Resolution No. 2014-11, which the qualified voters approved, imposing the District Sales Tax. The District Sales Tax is in the amount of an additional one-percent (1%) sales tax to be levied on the sale at retail of all tangible personal property or taxable services within the District. The District Sales Tax shall be imposed for a period expiring on the termination of the District, but not to exceed forty (40) years unless terminated sooner pursuant to the procedures set forth in CID Act. Section 3.2. Collection and Administration of the District Sales Tax. The District Sales Tax shall be collected by the Missouri Department of Revenue as provided in the CID Act. The District shall receive the District Sales Tax Revenues from the Missouri Department of Revenue, which shall be disbursed in accordance with this Agreement. The District shall perform all functions incident to the administration and enforcement of the District Sales Tax, to the extent not performed by the state,pursuant to the CID Act and this Agreement. Section 3.3. Distribution of the Revenue from the District Sales Tax. Beginning in the first month following the effective date of the District Sales Tax and continuing each month thereafter until the termination of the designation of tax increment financing for the Capital Mall TIF, the District shall, not later than the fifteenth (15th) day of each month, distribute the portion of the District Sales Tax revenues that are captured as Economic Activity Taxes (as such term is defined in the TIF Act) to the City. The City shall promptly deposit such funds into the Economic Activity Account, which is the separate segregated account within the Special Allocation Fund(as such term is defined in the TIF Act) into which Economic Activity Taxes are to be deposited. Section 3.4. Composition of the Board of Directors. A. In accordance with the Petition, the Board of Directors shall be composed of five (5) directors. One (1) of the directors shall be a designee of the City (the "City Director"). All directors shall meet all qualifications of the CID Act and the Missouri Constitution. The City and Executive Director will cooperate to provide for the designation in writing that each director, 4 47691781.2 including the City Director, is a representative of a property owner or a business owner within the District, in order to satisfy the requirements of Section 67.1451.2(2)(a), RSMo. B. The initial directors of the District have been identified in the Petition to form the District and have been appointed by the City prior to the execution of this Agreement. C. Successor directors, whether to serve a new term or to fill a vacancy on the District Board, shall be appointed in accordance with the CID Act and Petition according to a slate submitted to the Mayor by the Executive Director. Prior to expiration of the term of terms of any initial directors, the City Administrator (or his designee) and Executive Director (or his designee) shall meet and confer in good faith to reach a consensus on the proposed City Director. Following such meeting, the Executive Director shall promptly deliver the slate to the City Clerk, who shall deliver the slate to the Mayor. The Mayor may appoint the successor directors with the consent of the City Council according to the slate submitted by the Executive Director, or the Mayor or the City Council may reject the slate submitted and request in writing, with written reasons for rejection of the slate, that the Executive Director submit an alternative slate. D. If an alternative slate is requested, the procedure described above shall continue until the successor directors are appointed by the Mayor with the consent of the City Council. ARTICLE 4: DISTRICT IMPROVEMENTS Section 4.1 CID Improvements. The CID Improvements are to be funded from the non-captured portion of the District Sales Tax revenues (the "CID Revenues"). The CID Improvements are generally described as follows: the public and private improvements initially contemplated to be incurred by the District for repaving, renovating, resurfacing, installing adequate lighting and repairing existing lighting to the parking lots, renovating and rehabilitating the Capital Mall structure and related private improvements, and constructing, reconstructing, installing, repairing, maintaining and equipping certain public improvements within the District, including, without limitation: (a) renovating, reconstructing and repairing improvements to the exterior, interior and within common areas of the Capital Mall building and the District, (b) installing, repairing, and, as applicable, resurfacing common driveways, access roads, sidewalks, curbs, signs, streetlights, landscaping and parking areas, and (c) repairing and replacing storm sewers. The particular items included within the Improvements may be increased or amended from time to time and the costs of the Improvements to be financed by the District shall include all associated design, architecture, engineering, financing, private interest carry, legal and administrative costs of same (collectively, the "CID Improvements"). The CID Revenues may also from time to time be utilized to pay for services of the District, as the same were set forth in the Petition, and the formation and operation costs of the District as set forth in the Petition, which, collectively with the CID Improvements are referred to herein as the "CID Costs." The CID Costs contemplated within the first five (5) years of the District are more particularly described on Exhibit C. Section 4.2. Construction and Use of the CID Improvements. The CID Improvements shall be constructed at the direction of the District, provided that the CID Improvements shall, in any event, conform to and comply with the terms and conditions of all applicable state and local laws, ordinances and regulations (including, without limitation, 5 47691781.2 applicable zoning, subdivision, building and fire codes), subject to any variances and other governmental approvals. The City shall cooperate with the District in executing any approvals and permits and taking any other necessary actions to facilitate construction of the CID Improvements. Section 4.3. Funding the CID Improvements. The District shall utilize the CID Revenues to fund the CID Costs. The CID Revenues may be committed to fund the CID Costs in any manner determined by the District. The Parties currently contemplate that CID Revenues will be paid to the District after collection by the Missouri Department of Revenue on a"pay-as- you-go-basis." Only with the City's consent shall the District be authorized to issue special obligation bonds to finance the CID Improvements in accordance with the CID Act. Subject to the foregoing, the District may incur debt for the purpose of funding all or a portion of the CID Costs and CID Improvements. ARTICLE 5: DEFAULTS AND REMEDIES Section 5.1 Default and Remedies. An Event of Default shall occur upon the failure by any Party in the performance of any covenant, agreement or obligation imposed or created by this Agreement and the continuance of such failure for fifteen (15) days after the other Party has given written notice to such Party specifying such failure. If any Event of Default has occurred and is continuing, then any non-defaulting party may, upon its election or at any time after its election while such default continues, by mandamus or other suit, action or proceedings at law or in equity, enforce its rights against the defaulting party and its officers, agents and employees, and require and compel duties and obligations required by the provisions of this Agreement. Section 5.2. Rights and Remedies Cumulative. The rights and remedies maintained by any Party under this Agreement and those provided by law shall be construed as cumulative and continuing rights. No one of them shall be exhausted by the exercise thereof on one or more occasions. Any Party shall be entitled to specific performance and injunctive or other equitable relief for any breach or threatened breach of any of the provisions of this Agreement, notwithstanding availability of an adequate remedy at law, and any Party hereby waives the right to raise such defense in any proceeding in equity. Notwithstanding the foregoing, specific performance shall not be utilized to compel either the District or any developer to construct any improvements as contemplated herein. Further, no Party shall be entitled to receive any special, punitive, or consequential damages in any action related to this Agreement. Section 5.3. Waiver of Breach. No waiver of any breach of any covenant or agreement contained in this Agreement shall operate as a waiver of any subsequent breach of the same covenant or agreement or as a waiver of any breach of any other covenant or agreement, and in case of an Event of Default, a non-defaulting Party may nevertheless accept from the defaulting party, any payment or payments without in any way waiving the non-defaulting party's right to exercise any of its rights and remedies as provided herein with respect to any such default or defaults in existence at the time when such payment or payments were accepted by the non-defaulting party. Section 5.4. Excusable Delays. No Party shall be deemed to be in default of this Agreement because of Excusable Delays. Excusable Delays shall extend the time of 6 47691781.2 performance for the period of such Excusable Delay. For the purposes of this Section, an "Excusable Delay" shall be defined as delays due to acts of terrorism, acts of war or civil insurrection, strikes, riots, floods, earthquakes, fires, tornadoes, casualties, acts of God, labor disputes, governmental restrictions or priorities, embargoes, national or regional material shortages, failure to obtain regulatory approval from any Federal or State regulatory body, unforeseen site conditions, material litigation by parties other than the Parties not caused by the Parties' failure to perform, or any other condition or circumstances beyond the reasonable or foreseeable control of the applicable party using reasonable diligence to overcome which prevents such party from performing its specific duties or obligation hereunder in a timely manner. ARTICLE 6: MISCELLANEOUS Section 6.1. Effective Date and Term. This Agreement shall become effective on the date this Agreement has been fully executed by the Parties. This Agreement shall remain in effect for as long as the District is legally in existence. Section 6.2. Modification. The terms, conditions, and provisions of this Agreement can be neither modified nor eliminated except in writing and by mutual agreement among the Parties. Any modification to this Agreement as approved shall be attached hereto and incorporated herein by reference. Section 6.3. Jointly Drafted. The Parties agree that this Agreement has been jointly drafted and shall not be construed more strongly against another Party. Section 6.4. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Missouri. Section 6.5. Validity and Severability. It is the intention of the Parties that the provisions of this Agreement shall be enforced to the fullest extent permissible under the laws and public policies of State of Missouri, and that the unenforceability (or modification to conform with such laws or public policies) of any provision hereof shall not render unenforceable, or impair, the remainder of this Agreement. Accordingly, if any provision of this Agreement shall be deemed invalid or unenforceable in whole or in part, this Agreement shall be deemed amended to delete or modify, in whole or in part, if necessary, the invalid or unenforceable provision or provisions, or portions thereof, and to alter the balance of this Agreement in order to render the same valid and enforceable. Section 6.6. Execution of Counterparts. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument. Section 6.7. City Approvals. Unless specifically provided to the contrary herein, all approvals of the City hereunder may be given by the City Administrator or his or her designee without the necessity of any action by the City Council. The City Administrator may seek the input from the City Council before granting any approval. 7 47691781.2 Section 6.8. District Approvals. Unless specifically provided to the contrary herein, all approvals of the District hereunder may be given by the Executive Director of the District or his or her designee without the necessity of any action by the Board of Directors. [Remainder of page intentionally blank.] 8 47691781.2 IN WITNESS WHEREOF, the parties hereto have set their hands and seals the day and year first above written. CITY OF JEFFERSON, MISSOURI By: / / Eric Struemph17:or If ATTEST: APPROVED AS TO FORM: 41•14,4________ Ai Cl/rk �„' "7„,„ ty e Ci•. ounselor STATE OF MISSOURI ) ) SS. COUNTY OF JACKSON ) On this S day of / 1 , 2014, before me appeared, Eric Struemph, who being, by me duly sworn, did say tliat he is the Mayor of the CITY OF JEFFERSON, MISSOURI, a first class city and political subdivision of the State of Missouri, and did say that the seal affixed to the foregoing instrument is the seal of said City, and that said instrument was signed and sealed on behalf of said City, by authority of its City Council, and said Mayor acknowledged said instrument to be the free act and deed of said City. IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed my official seal in the County and State aforesaid, the day and year first above written. JEREMIAH V.COVERV Notary Public-Notary Seal e ------ State of Missoun •,o • 'ubhc Commissioned for Boone County (SEAL) My Commission Expires:October 09,2016 Commission Number: 12822080 My commission expires: /v / //2-o/ 9 47691781.2 CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT By: Mike a er, Executive Director ATTEST: 41_ Se e STATE OF MISSOURI ) ) SS. COUNTY OF Lea. ) On this O day of , 2014, before me appeared Mike Farmer, who being by me duly sworn, did say that 's the Executive Director of the CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT, a community improvement district organized and existing under the laws of the State of Missouri, and that said instrument was signed in behalf of said District by authority of its Board of Directors and said individual acknowledged said instrument to be the free act and deed of said District. IN TESTIMONY WHEREOF, I have hereunto set my hand and affixed my official seal in the County and State aforesaid,the day and year first above written. UGXIL Notary 'ublic (SEAL) JEAN MACKNEY Notary Public- Notary Seal STATE OF MISSOURI L CountyofCole My commission expires: / My Commission Expires 11/27/2015 Commission#11500009 10 47691781.2 EXHIBIT A CID ORDINANCE 47691781.2 SUBSTITUTE BILL NO. 2013-126 SPONSORED BY COUNCILMAN Schulte ORDINANCE NO. 15223 AN ORDINANCE APPROVING A PETITION FOR THE ESTABLISHMENT OF THE CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT, INCLUDING THE APPOINTMENT OF THE CID BOARD OF DIRECTORS. WHEREAS, Sections 67.1401 to 67.1571, RSMo as amended (the "CID Act") authorizes the governing body of any municipality, which term includes counties, upon receipt of a proper petition requesting the establishment and after a public hearing, to adopt an ordinance establishing a community improvement district; and WHEREAS, the City of Jefferson, Missouri (the "City"), is a city of the third classification and a political subdivision of the State of Missouri, duly created, organized and existing under and by virtue of the laws of the State of Missouri; and WHEREAS, on November 1, 2013, pursuant to the CID Act, a Petition to the City of Jefferson, Missouri, for the Establishment of the Capital Mall Community Improvement District ("Petition"), signed by: (1) property owner(s) collectively owning more than fifty percent (50%) of the assessed property value or real property; and (2) more than fifty percent (50%) of the per capita owners of all real estate within the boundaries of the proposed Capital Mall Community Improvement District (the "District") was filed with the City Clerk; and WHEREAS, the City Clerk verified that the Petition substantially complied with the CID Act, submitted the verified Petition to the City Council, and set a public hearing with all proper notice being given in accordance with the CID Act or other applicable law; and WHEREAS, none of the signatures of the signers of the Petition were withdrawn within seven days after the filing of the Petition with the City Clerk; and WHEREAS, all the real property included in the District is entirely located within the City; and WHEREAS, the City Council, following notification by the City Clerk, conducted a public hearing on January 6, 2014, after publishing the notice specified in Section 67.1431.3 of the CID Act, copies of which publication and mailed notices are on file with the City Clerk; and WHEREAS, all persons interested in the formation of the Capital Mall Community Improvement District were allowed an opportunity to speak at the public hearing before the City Council; and Substitute Bill 2013-126 Page 1 WHEREAS, the Petition to establish the District being fully heard before the City Council, the City Council now desires to establish the District and make such other findings as necessary. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF JEFFERSON, MISSOURI, AS FOLLOWS: Section 1. All terms used in this Ordinance shall be construed as defined in the CID Act, and the Petition. Section 2. The City Clerk has verified that the Petition substantially complies with all submission requirements of the CID Act. Section 3. The District is hereby approved and shall be established within the City as a political subdivision of the State of Missouri, as provided in the Petition filed with the City Clerk on November 1, 2013, a copy of which is attached hereto as Exhibit 1 and incorporated herein by this reference. The District includes the contiguous tracts of real estate as described in Exhibit 2, and shown on a map as depicted in Exhibit 3, both of which are incorporated herein by reference. Section 4.-That the District shall have all the powers and authority authorized by the Petition and by the CID Act, and that the District shall expire forty (40) years from the effective date of this Ordinance, unless sooner terminated in accordance with the CID Act. Section 5. The District shall be governed by a board of directors consisting of five (5) members. The names and terms of office of the initial Board of Directors were provided in the Petition and the following individuals are hereby appointed by the Presiding Commissioner with the consent of the City Council to serve as the Board of Directors for the District for the initial terms set forth below: Bud Farmer— Director, 4 years Mike Farmer— Director, 4 years Jamie Reed — Director, 2 years Chuck Pierce — Director, 2 years Ron Fitzwater— Director, 2 years Section 6. The District's Board of Directors shall have authority to impose a sales tax in an amount not to exceed one percent (1%), as set forth in the Petition and in conformance with the CID Act. Section 7. Based on the evidence provided in the Blight Study Report dated July 30, 2013, and prepared by Valbridge Property Advisors and submitted as Exhibit D of the Petition, the City Council hereby finds that the property located within the District is a blighted area because it suffers from a predominance of a combination of factors Substitute Bill 2013-126 Page 2 including defective and inadequate street layout, insanitary and unsafe conditions, deterioration of site improvements, improper subdivision and obsolete platting, and the existence of conditions which endanger life or property by fire or other causes, which factors have constitutes an economic and social liability and a menace to the public health, safety, morals and welfare in its current condition. Considering this finding, the District shall have all of the powers of blight remediation provided to it by the CID Act. Section 8. The District shall have and possess without limitation, such powers authorized under the CID Act and as set forth or otherwise limited in the Petition and as agreed in a cooperative agreement between the City and the District. Section 9. The City Clerks is hereby directed to prepare and file with the Missouri Department of Economic Development (the "Department") the report specified in subsection 6 of Section 67.1421 of the CID Act, substantially in the form provided by the Department, which is attached hereto as Exhibit 4. Section 10. It is hereby declared to be the intention of the City Council that each and every part, section and subsection of this Ordinance shall be separate and severable from each and every other part, section and subsection hereof and that the City Council intends to adopt each said part, section and subsection separately and independently of any other part, section and subsection. In the event that any part, section or subsection of this Ordinance shall be determined to be or to have been unlawful or unconstitutional, the remaining parts, sections and subsections shall be and remain in full force and effect, unless the court making such finding shall determine that the valid portions standing alone are incomplete and are incapable of being executed in accord with the legislative intent. Section 11. That this Ordinance shall be in full force and effect from and after the date of its passage and approval. PASSED, APPROVED AND ADOPTED by the City Council of the City of Jefferson, Missouri, on this 21st day of January, 2014. Passed: / Approved: Presiding Officer Mayor ATTEST: APPROVED AS TO FORM: City Clerk City Counselor Substitute Bill 2013-126 Page 3 EXHIBIT B CID PETITION 47691781.2 EXHIBIT 1 PETITION TO ESTABLISH THE CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT SEE ATTACHED Substitute Bill 2013-126 Page 4 SUBSTITUTE EXHIBIT 2 LEGAL DESCRIPTION OF THE CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT Part of the South Half of Section 4, and part of the Northeast Quarter of the Northwest Quarter and part of the West Half of the Northwest Quarter of the Northeast Quarter of Section 9, all in Township 44 North,Range 12 W, in the City of Jefferson, Cole County,Missouri,more particularly described as follows: BEGINNING at the northeast corner of the West Half of the Northwest Quarter of the Northeast Quarter of said Section 9; thence S4°26'19"E, 760.31 feet to the northerly line of Old U.S. Route No. 50 (now Country Club Drive); thence S4°44'37"E, crossing said Country Club Drive right-of-way, 101.20 feet to a point on the southerly line thereof and said corner being the northwest corner of a tract of land described by deed of record in Book 136, page 132, and on the easterly boundary of a tract described by deed of record in Book 239, page 903, Cole County Recorder's Office; thence S4°34'31"E, along the easterly boundary of said tract described in Book 239, page 903, 375.37 feet to the southeasterly corner thereof, said corner being on the northerly line of U.S. Route No. 50; thence S75°33'03"W, along the northerly line of said U.S. Route No. 50, 77.73 feet; thence N88°24'20"W, along the northerly line of said U.S. Route No. 50, 125.05 feet to the southeasterly corner of a tract of land described by deed of record in Book 362, page 519, Cole County Recorder's Office; thence N7°57'56"W, along the easterly boundary of said tract described in Book 362, page 519, 346.95 feet to the northeasterly corner thereof, said corner being on the southerly line of the aforesaid Country Club Drive; thence S77°59'08"W, along the southerly line of said Country Club Drive, 334.21 feet to the northwesterly corner of a tract of land described by deed of record in Book 315, page 773, Cole County Recorder's Office; thence S 14°07'00"E, along the westerly boundary of said tract described in Book 315, page 773, 273.73 feet to the southwesterly corner thereof, said corner being on the northerly line of the aforesaid U.S. Route No. 50; thence N88°24'20"W, along the northerly line of said U.S. Route No. 50, 765.43 feet; thence S75°24'00"W, along the northerly line of said U.S. Route No. 50, 36.12 feet to the southeasterly corner of a tract of land described by deed of record in Book 298, page 83, Cole County Recorder's Office; thence N3°07'58"W, along the easterly boundary of said tract described in Book 298, page 83, 96.22 feet to the northeasterly corner thereof, said corner being on the southerly line of the aforesaid Country Club Drive; thence continuing N3°07'58"W, 102.09 feet to the northerly line of said Country Club Drive; thence S78°00'23"W, along the northerly line of said Country Club Drive, 104.04 feet to the most easterly corner of the U.S. Highway 50 connection right-of-way described by deed of record in Book 240, page 660, Cole County Recorder's Office; thence, along the northerly line of said connection right-of-way, the following courses: N85°29'44"W, 264.86 feet; thence N49°07'58"W, 230.71 feet; thence N47°05'00"W, 313.86 feet to the easterly line of West Truman Boulevard(formerly known as North Ten Mile Drive); thence N8°34'28"E, along the easterly line of said West Truman Boulevard, 490.41 feet; thence N697'21"E, along the easterly line of said West Truman Boulevard, 401.12 feet to the northerly end of the aforesaid connection right-of-way; thence N79°05'18"W, 36.28 feet to the centerline of West Truman Boulevard (as described in Parcel 1 of the deed of record in Book 626, page 565 Cole County Recorder's Office); thence, leaving the aforesaid connection right-of-way line, described in Book 240, page 660, N3°27'09"E, along the centerline of West Truman Boulevard (as per said Parcel 1 description), 113.55 feet; thence N23°44'10"E, along the centerline of West Truman Boulevard (as per said Substitute Bill 2013-126 Page 5 Parcel 1 description), 233.03 feet to the southerly end of the property deeded to the City of Jefferson for the street right-of-way, now known as West Truman(formerly known as North Ten Mile Drive) as per deed of record in Book 275, page 214, Cole County Recorder's Office; thence N85°03'03"E, along the southerly line of said property described in Book 275, page 214, and along the southerly boundary of the property described by deed of record in Book 555, page 698, along the southerly boundary of El Mercado Development, Section 1, as per plat of record in Plat Book 11, page 402 and along the southerly boundary of those properties described by deeds of record in Book 529, page 947 and in Book 462, page 649, Cole County Recorder's Office, 1461.95 feet; thence N86°1 l'11"E, along the southerly boundary of said property described in Book 462, page 649 and along the southerly boundary of the property described by deed of record in Book 546, page 150, Cole County Recorder's Office, 692.99 feet to the southeasterly corner of said property described in Book 546, page 150 and said corner being on the westerly boundary of Monticello Acres, Section Nine, as per plat of record in Plat Book 11, page 859, Cole County Recorder's Office; thence S3°59'18"E, along the westerly boundary of Monticello Acres, Section Nine, 700.95 feet to the southwesterly corner thereof, being a point on the south line of said Section 4, Township 44 North, Range 12 West, at the southeasterly corner of the property described by deed of record in Book 629, page 196, Cole County Recorder's Office; thence S86°32'02"W, along the Section Line, 389.43 feet to the POINT OF BEGINNING. Substitute Bill 2013-126 Page 6 EXHIBIT 3 MAP OF DISTRICT BOUNDARIES �' rr+�sasr�unorwvau�lrtv -�.:_ _ ... .__- r' ?�-�r;s T:•t=om W.ali IL-LLC Substitute Bill 2013-126 Page 7 EXHIBIT 4 CID NOTICE OF ESTABLISHMENT FORM SEE ATTACHED Substitute Bill 2013-126 Page 8 PETITION FOR ESTABLISHMENT OF THE CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT CITY OF JEFFERSON, MISSOURI OCTOBER 2013 (` PETITION FOR THE CREATION OF THE CAPITAL MALL COMINUNITY IMPROVEMENT DISTRICT To the Mayor and City Council of the City of Jefferson, Missouri: The undersigned real property owners(the"Petitioners'),being the owner collectively owning (1) more than fifty percent(50%) by assessed value of the real property and (2) more than fifty percent(50%)per capita of all owners of real property within the boundaries of the hereinafter described community improvement district, do hereby petition and request that the City Council of the City of Jefferson, Missouri create a community improvement district as described herein under the authority of Sections 67.1401 to 67.1571, RSMo (the "CID Act"). In support of this petition, the Petitioners sets forth the following information in compliance with the CID Act: 1. District Name. The name for the proposed community improvement district ("CID" or "District") is: Capital Mall Community Improvement District 2. Legal Description and Map. A legal description and map generally depicting_ the boundaries of the proposed District are attached hereto as Exhibit A and Exhibit B, respectively. The proposed district consists of 78.26 +/- acres and is located entirely within the City of Jefferson, Missouri. 3. Five-Year Plan. A five-year plan as required by the CID Act is attached hereto as Exhibit C (the"Five Year Plan"). 4. Form of District. The proposed district will be established as a political subdivision of the State of Missouri under the CID Act. 5. Board of Directors. a. Number. The District shall be governed by a Board of Directors (the "Board") consisting of five (5) members, who shall be appointed by the municipality in accordance with this petition. One (1) member shall be either an elected or appointed official of the City of Jefferson, Missouri, as determined by the City Administrator or his designee. b. Qualifications. In addition to the requirement that one (1) member shall be either an elected or appointed official of the City of Jefferson, Missouri, as determined by the City Administrator or his designee, each. Member of the Board ("Director') shall meet the following requirements: (1) be at least 18 years of age; (2) be and must declare to be either an owner of real property within the District ("Owner') or an authorized representative of an Owner, an owner of a business IL operating within the District ("Operator'), or a registered voter ("Resident") 1 i residing within the District, as provided in the CID Act; (3) be and have been a resident of the State of Missouri for at least one year immediately preceding the date upon which he or she takes office in accordance with Article VII, Section $ of the Missouri Constitution; and (4) except for the initial directors named in this Petition, be nominated according to a slate submitted as described in this Petition. C. Initial Directors. The initial directors ("Initial Directors") and their respective terms shall be as follows: (1) Bud Farmer four(4) year term (2) Mike Farmer four(4) year term (3) Jamie Reed two (2) year term (4) Chuck Pierce two (2)year term (5) City Administrator Designee pursuant to Section 5(a) two(2)year term d. Terms. Each Initial Director named above shall serve for the term set forth opposite his/her name or until his/her successor is appointed in accordance with this Petition. Each Successor Director shall serve a four (4) year term or until his/her successor is ' appointed in accordance with this Petition. If, for any reason, a Director is not able to i serve his/her term, the remaining Directors shall elect an Interim Director to fill the vacancy of the unexpired term. Notwithstanding anything to the contrary, any Director's failure to meet the qualification requirements set forth above, either in a Director's individual capacity or in a Director's representative capacity, shall constitute cause for the Board to take appropriate action to remove said Director. e. Successor Directors. Successor Directors shall be appointed by the Mayor with the consent of the City Council by resolution according to a slate submitted by the Executive Director of the District to the City of Jefferson, Missouri's City Clerk (the "City Clerk'). Upon receipt of a slate of Successor Directors, the City Clerk shall promptly deliver the slate to the Mayor for consideration by the City Council. 6. Assessed Value. The total assessed value of all real property in the District is $7,527,$72. 7. Duration of District. The proposed maximum length of time for the existence of the district is forty (40) years from the date of the ordinance approving the Petition. The District may be terminated prior to the end of such maximum forty (40) year term in accordance with the 2 provisions of the CID Act, and the forty (40) year term shall not be extended unless a new petition is submitted and approved pursuant to the terms of the CID Act. 8. Real Property and Business License Taxes. The District will not have the power to impose a real property tax levy or business license taxes. 9. Special Assessments. The District will not have the power to impose special assessments. 10. Sales Tax. Qualified voters of the District may be asked to approve a sales tax of up to one percent (1%) ("District Sales Tax"), in accordance with the CID Act, to fund certain improvements within the District and/or to pay the costs of services provided by the District. Additional details about the District Sales Tax are set forth in the Five Year Plan attached hereto as Exhibit C. 11. Borrowing Limits. Petitioner does not seek limitations on the borrowing capacity of the District. 12. Revenue Limits. Petitioner does not seek limitations on the revenue generation of the District. 13. Future Five Year flans. The District shall submit future Five (5) Year Plans meeting the requirements of Section 1421.2(3)(4), RSMo (as amended or replaced from time to time) to the City for comment and review no earlier than 180 days and no later than 90 days prior to the expiration of each then-current Five(5) Year flan. 14. Authority Limits. Petitioner does not seek limitations on the authority of the District, except as set forth in this Petition. 15. Blight. Petitioner requests a finding by the City of Jefferson, Missouri City Council that the property is blighted, by reason of the predominance of defective or inadequate street layout, insanitary or unsafe conditions, deterioration of site improvements, improper subdivision or obsolete platting, or the existence of conditions which endanger life or property by fire and other causes, or any combination of such factors, the District constitutes an economic or social liability or a menace to the public health, safety, morals or welfare in its present condition and use. Attached as Exhibit D is a Blight Study covering the District, which provides evidence of the above blight conditions. Alternatively, Petitioner seeks a finding that the District has been declared blighted by the City of Jefferson, Missouri City Council under Sections 99.800 to 99.865, RSMo. 16. Revocation of Signatures. THE PETITIONER ACKNOWLEDGES THAT THE SIGNATURE OF THE SIGNER OF THIS PETITION MAY NOT BE WITHDRAWN FROM THIS PETITION LATER THAN SEVEN (7) DAYS AFTER THE FILING HEREOF WITH THE CITY CLERK. WHEREFORE, Petitioner respectfully requests that the City Council establish the requested Capital Mall Community Improvement District in accordance with the information set forth in this Petition and that the Mayor appoint and the City Council consent to the proposed members for the Board of Directors as set forth in this Petition, and take all other appropriate and necessary action that is consistent with the CID Act to establish the requested district. 3 EXF;CUTION PAGE FOR PETITION FOR TRE CREATION OF THE CAPITAL MAIL COMMUNITY IMPROVEMENT DISTRICT Name of owner: Capital Mall JCI,LLC,a Missouri limited liability company Owner's telephone number: (573)635-2255 Owner's address:c/o Farmer Holding Company,221 Bolivar Street,Suite 400,Jefferson City,Missouri 65101 IF SIGNER IS DIFFERENT FROM OWNER: Name of signer: Title: Signer's telephone number: Signer'%mailing address: If owner is an individual: Single Married If owner is not an individual,state what type of entity(Mark Applicable Box): Co oration General Paftership Limited Partnership x Limited 1jabifity Company patinerahip Urban Redevelo ntent Corporation Not-for-Profit.Corpora n Other Map(see Exhibit B)and parcel number(s): 10-02-09-0002-001-001 Total Assessed value: $ ,999,92 ` 1 -4126T fill- By 3Z.By execating this petition, the undersigned represents and warrants that he/she is authorized to execute this petition on behalf of the property owner named immediately below. Capital Mall JC1, LLC, a Missouri limited tiability company By: r1ao Title:__ Aur�rsGp_ _�Q'R�e+•++.,a��tti' STATE OF MISSOURI ) ss: COUNTY OF ) (7n thiiay or-UA, 2013, before nae appear to me personally known, who, being by me duly sworn did say that helslte is th f Ca 9 Mall JCl, LLC, a Missouri limited liability company, and that said instrument wa 8i8 ned on shelf of aid limited liability company, I and said limited liability company acknowledged said instrument to be the free act and deed of said entity, WITNESS my hand and official seal this day of 2013. My Commission Expire: a-27, Not P c JEAN MACK Y Notary Publlo-Notary Seal STATE OF MISSOURI County of Cole My Commission Expires 11137/2015 Commleslon N 11500009 EXECUTION PACE FOR PETITION FOR THE CREATION OF THE CAPITAL MALI CONM fA TTY IMPROVEMENT DISTRICT Name of owner: Capital Mall JC2,LLC,a Missouri limited liability company Owner's telephone number: (573)635-2255 Owner's address:c/o'Farrier Holding Company,221 Bolivar Street,Suite 400,Jefferson City,Missouri 65101 IF SIGNER IS DIFFERENT"FROM OWNER: Name of signer: Title: Signer's telephone number: Signer's mailing address: If owner is an individual: Single Married If owner is not an individual,state what type of entity(Mark Applicable Box): Corporation Gotteral Pu1nmbi Limited Partnership x Limited Uability CompanyJ Partnership Urban Redevelopment Corporation Not-for-Profit Corporation Other Map(see Fxhibit B)and parcel number(s): 10-02-04-0003-002-036 Total Assessed value' ^2,,44b;15 `" t,�`��' q 114 By executing this petition, the undersigned represents and warrants that he/she is authorized to execute this petition on behalf of the property owner named immediately below. Capital Mall JC2, LIX, a Missouri limited liability company By: Mune: 'AM —6PjW.11uX1 STATE OF MISSOURI ) ss: COUNTY OF On this lay of 2013, befare me appeared to me personally known, who, being.by me duly sworn did say that he/she is the�,u „ Aalfof �hintnited Mall JC2, LLC, a Missouri limited liability company, and that said instrument was signed on liability company, and said limited liability company acknowledged said instrument to be the free act and deed of said entity. WITNESS my hand and official seal this;j�day of ,2013. My Commission Expires ,��� �}+ tar ublic JEAN MACKNE Notary Publlo-NotalSeal STATE OF MIS900RI _z County of Cole My Commission Expires 11/27/2015 Commission 0 11500009 EXECUTION PAGE FOR PETITION FOR THE CREATION OF THE CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT Name of owner: Capital Mall JC3,LLC,a Missouri limited liability company Owner's telephone number: (573)635-2255 Owner's address:c/o Farmer Holding Company,221 Bolivar Street,Suite 400,Jefferson City,Missouri 65101 IF SIGNER IS DIFFERENT"FROM OWNER: Name of signer- Title: igner'title: Signer's telephone number: Signer's mailing address: If owner is an individual: Single Married If owner is not an individual,state what type of entity(Mark Applicable Box): Corporation General Partnershi Limited Partnership x Limited Liability Company Partnership Urban Redevelopment Corporation Not-for-Profit Corporation Other Map(see Exhibit B)and parcel number(s): 10-02-04-0004-000-025.003 Total Assessed value: $281,024 By executing this petition, the undersigned represents and warrants that he/she Is authorized to execute this petition on behalf of the property owner named immediately below. Capital Mali JC3, LLC, a Missouri limited liability company By: '---, Title: STATE OF MISSOURI ) } ss: COUNTY OF On this day of , 2013, before me appeared:R1 to me personally known, who, being by me duly sworn did say that hefshe is the Chota.t Mall JC3, LLC, a Missouri limited liability company, and that said instrument was signed on behalf of s id limited liability company, and said limited liability company acknowledged said instrument to be the free act and deed of said entity. WITNESS my hand and official seal this day of t ,2013. r My Commission Exp ires'll 0 1 R C90 l5to ublic JEAN MACKNEY Notary Public-Notary Seal STATE OF MISSOURI County of Cale- My Commission Expires 1112712015 CommIrsion#11500009 y.. EXECUTION PAGE FOR PETITION FOR THE CREATION OF THE CAPITAL MALL COMMUNITY 01PROVEMENT DISTRICT Name of owner: Capital Mall JC4,LLC,a Missouri limited liability company Owner's telephone number: (573)635-2255 Owner's address: c/o Farmer Holding Company,221 Bolivar Street,Suite 400,Jefferson City,Missouri 65101 IF SIGNER IS DIFFERENT FROM OWNER: Name of signer: Title: Signer's telephone number: Signer's mailing address: If owner is an individual: Y,_ Single Married If owner is not an individual,state what type of entity(Mark Applicable Box): Corporation Gem"Iti Partne Limited PartnersWp x Limited Liability Company Partimrship Urban Redevelopment Corporation Not-for-Profit Corporation Other Map(see Exhibit B)and parcel number(s): 10-02-04-0004-000-025 Total Assessed value: $-f 3;3,� { I,o T 6 By executing this petition,the undersigned represents and warrants that he/she Is authorized to execute this petition on behalf of the property owner named immediately below. Capital Mall JC4, LLC, a Missouri limited liability company Iiy: - ] Nanrc:_ _ Title: 4ff## e.r-" ftfWWFd*—rJ0c STATE OF MISSOURI ) s<9: COUNTY OF Onihis�dayof - 2013, before me appearc to me personally known,who,being by me duly sworn did say that he/she is the Capt° Mall JC4, LLC,a Missouri limited liability company, and that said instrument was signed on be all of said limited liability company, and said limited liability company acknowledged said instrument to be the tree act and deed of said entity. WITNL-.SS my hand and official seal thisr day of ,2013. My Commission Expires: L� 0(5 ota public JEAN MACKNEY Notary Publlo-Notary Seal STATE OF MISSOURI -- - County of Cats MyCommiselon Ex herr 11127/kl5 CornMIs510n 411600001) EXECUTION PAGE FOR PETITION FOR TRE CREATION OF THE CAPITAL MALL CONLMUNITY IMPROVEMENT DISTRICT Name of owner: Capital Mall JC5,LLC,a Missouri limited liability company Owner's telephone number: (573)635-2255 Owner's address:c/o Farmer Holding Company,221 Bolivar Street,Suite 400,Jefferson City,Missouri 65101 IF SIGNER IS DIFFERENT FROM OWNER: Name of signer: Title: Signer's telephone number: Signer's mailing address: If owner is an individual: Single Married If owner is not an individual,state what type of entity(Mark Applicable Box): Co oration General Partnership Limited Partnership x Limited Liability Company Partnership Urban Redevelopment Corporation Not-for-Profit Corporation Other Map(see Exhibit B)and parcel number(s): 10-02-09-0001-001-022 Total Assessed value: $320 By executing this petition, the undersigned represents and warrants that he/she is authorized to execute this petition on behalf of the property owner named immediately below. Capital Mall JC5, LLC, a Missouri limited liability company By: ti--� Name: 14aa ic1"C.awi-I Title: Aj rsvewcc-� uC STATE OF NHSSOUR 1 ) ss: COUNTY OF ) On this C day of , 2013, before me appear*igri Q to me personally known, who,being by me duly sworn did say that he/she is th Capi Mall JC5, LLC, a Missouri limited liability company,and that said instrument wb -If of said limited liability company, and said limited liability company acknowledged said instrument to be the free act and deed of said entity. WITNESS my hand and official seal this day o ,2013. My Commission Expires:` _67, [? No Public JEAN MACKNEY Notary Publio-Notary Seal STATE OF MISSOURI Country of Dole My Commission Expires 11127!2015 Comm lesion 411500009 EXECUTION PAGE FOR PETITION FOR THE CREATION OF THE CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT Name of owner: Capital Mall JC6,LLC,a Missouri limited liability company Owner's telephone number. (573)635-2255 Owner's address:clo Farmer Holding Company,221 Bolivar Street,Suite 400,Jefferson City,Missouri 65101 IF SIGNER IS DIFFERENT FROM OWNER: Name of signer: Title:. Signer's telephone number. Signer's mailing address: If owner is an individual: Single Married If owner is not an individual,state what type of entity(Mark Applicable Box): Co oration General Partnership Limited Partnership x Limited Liability Company Partnership Urban Redevelopment Corporation Not-for-Profit Corporation Other Map(see Exlubit B)and parcel number(s): 10-02-04-0001-002-011 Total Assessed value: $35,200 By executing this petition, the undersigned represents and warrants that he/she is authorized to execute this petition on behalf of the property owner named immediately below. Capital Mall JC6, LLC, a Missouri limited liability company By: Name: A-3 4,-,7r jg±3 Title: A6*7jpe,ec0 +s caerwrtwss STATE OF MISSOURI&0 ) ss: COUNTY OF On thisR;;;bay of 2013, before me appear to me personally known,who,being by me duly sworn did say that he/she is th 'ap all JC6, LLC, a Missouri limited liability company,and that said instrument was signed on b if of sa d limited liability company, and said limited liability company acknowledged said instrument to be the free act and deed of said entity. WITNESS my hand and official seal this<2z�-day of aLkioas 2013. (1-.�— Qjjc �C L My Commission Expires/ a tublic JEAN MAClfNI;Y Notary Fublia-Notary Seal STATE OF MISSOURI Caunty of Cole My Commission Expires 1112712015 Commission#11500009 EXECUTION PAGE FOR PETITION FOR THE CREATION OF THE CAPITAL MALL COMMUNITY IMPROVEMENT DIS'T'RICT Name of owner: Capital Mall JC7,LLC,a Missouri limited liability company Owner's telephone number: (573)635-2255 Owner's address:c/o Farmer Holding Company,221 Bolivar Street,Suite 406,Jefferson City,Missouri 65101 IF SIGNER IS DIFFERENT FROM OWNER: Name of signer: Title: Signer's telephone number. Signer's mailing address: If owner is an individual: Single Married if owner is not an individual,state what type of entity(Mark Applicable Box): Co oration General Partnership Limited Partnership x Limited Liability Company Partnership Urban Redevelopment Corporation Not-for-Profit Corporation Other Map(see Exhibit B)and parcel number(s): 10-02-09-0001-001-024 Total Assessed value: S63,136 By executing this petition, the undersigned represents and warrants that he/she is authorized to execute this petition on behalf of the property owner named immediately below. Capital Mail JC7, LLC, a Missouri limited liability company By: t '"r`!'1 Name: AZ �tirra►+f+`'t Title: A-n4cAf tA- Akmysmnon v6 STATE OF MISSOURI ) } 5S: CO[1NTY OF N& On thi; iay o 2013, before me appeare to me personally known, who,being by me duly sworn did say that helshe is th of Ca al Mall JC7, LLC, a Missouri limited liability company,and that said instrument was signed o ehaWosad limited liability company, and said limited liability company acknowledged said instrument to be the free act and deed of said entity. WITNESS my hand and official seal thisOkF�-day of GAW '2013. My Commission Expires -7 02 Notar ublic JEAN MACKNEY Notary Public-Notary Seal STATE OF MISSOURI County of Cole My Commission Expires 11127/2015 Commission#91500009 EXECUTION PAGE FOR PE.'1'ITION FOR THE CREATION OF THE CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT Name of owner: Capital Mall JC8,LLC,a Missouri limited liability company Owner's telephone number: (573)635-2255 Owner's address:c/o Farmer Holding Company,221 Bolivar Street,Suite 400,Jefferson City,Missouri 65101 IF SIGNER IS DIFFERENT FROM OWNER: Name of signer: Title: Signer's telephone number: Signer's mailing address: If owner is an individual: Single Married If owner is not an individual,state what type of entity(Mark Applicable Box): Co oration. General Partnership Limited Partnership x Limited Liability Company Partnership Urban Redevelopment Corporation Not-for-Profit Corporation Other Map(see Exhibit B)and parcel number(s): 10-02-09-0002-001-004 Total Assessed value: $ 145,024 By executing this petition,, the undersigned represents and warrants that he/she is authorized to execute this petition on behalf of the property owner named immediately below. Capital Mall JC8, LLC, a Missouri limited liability company Name:,kS_ a•j" _ Title:_ VfC4LgtXV S'T'ATE OF MISSOURI } } ss: COUNTY OF ) On this�day of , 2Q 13, before me appeared to me personalty known, who,being by me duty sworn did say that he/she is thA—. f C, it I Mall JC8, LLC, a Missouri limited liability company,and(hat said instrument w signed o ehalf of id limited liability company, and said limited liability company acknowledged said instrument to be the free act and deed of said entity.. WITNESS my hand and official seal this day of ,2013. Is_ Lac�\AJA My Commission ExpuesAL 7. Public ,JEAN MACK Y Notary Public-NotaSeal STATE OF MiS801121 County of Cole res My Commission Expires 1 1 127120 1 5 Comm lasion 611500009 EXECUTION PAGE.FOR PETITION FOR THE CREATION OF TEEE CAPITAL.MALL COMMUNITY IMPROVEMENT DISTRICT Name of owner: Capital Mall JC9,LLC,a Missouri limited liability company Owner's telephone number. (573)635-2255 Owner's address:c/o Farmer Holding Company,221 Bolivar Street,Suite 400,Jefferson City,Missouri 65101 IF SIGNER IS DIFFERENT FROM OWNER; Name of signer: Title: Signer's telephone number: Signer's mailing address: If owner is an individual: Single Married If owner is not an individual,state what type of entity(Mark Applicable Box): Co oration General Partnership Limited Partnership x Limited Liability Company Partnership Urban Redevelopment Corporation Not-for-Profit Corporation Other Map(see Exhibit 13)and parcel number(s): 10-02-09-0002-001-002 Total Assessed value: $70,848 By executing this petition, the undersigned represents and warrants that he/she Is authorized to execute this petition on behalf of the property owner named immediately below, Capital Mall .IC9, LLC, a Missouri limited liability company Name: fit$ IC�4na.+ Title: A-rv0o4j2&dP tC�P�e��etr vE STATE OF MISSOURI ) ss: COUNTY OF OLVO On tivsa�day of 2013, before me appear ]Mow3. to me personally known, who,being by me duly sworn did say that he/she is the a tjil Mall JC1, LLC, a Missouri limited liability company, and that said instrument was signed on btEalf of slid limited liability company, and said limited liability company acknowledged said instrument to be the free act and deed of said entity. WITNESS my hand and official seal this 0?0�day of ` ,2013. 1 My Commission Expires [p-�-7' —2,0 No u lic JEA CKNEY Note Publlo-Notary Seal STATE OF MISSOURI Courlty of Cole (W My Commisslon Expires 11/2712015 Commisaton# 11500ooJ EXECUTION PAGE FOR PETITION FOR THE CREATION OF THE CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT Name of owner: Capital Mall 1010,LLC,a Missouri limited liability company Owner's telephone number: (573)635-2255 Owner's address:c/o Farmer Ilolding Company,221 Bolivar Street,Suite 400,Jefferson City,Missouri 65101 IF SIGNER IS DIFFERENT FROM OWNER: Name of signer: Title: Signer's telephone number, Signer's mailing address: If owner is an individual: Single Married If owner is not an individual,,state what type of entity(Mark Applicable Box): Corporation General Partnership Limited Partnership x Limited Liability Company Partnership Urban Redevelopment Corporation Not-for-Profit Corporation Other Map(see Exhibit B)and.parcel number(s): 10-02-09-0002-001-006 Total Assessed value: $ 184,480 By executing this petition, the undersigned represents and warrants that he/she is anthorized to execute this petition on behalf of the property owner named immediately below. Capital Mall JC10, LLC, a Missouri limited liability company By: .+r to ..I Name: Iryff Title: tG1DitE,�B•++�fti.►� STATE OF MISSOURI ) COUNTY OF Of)A ) ss: On thisa�day of , 2013, before me appeare Q to me personally known, who,being by me duly sworn did say that he/she is the 1f Ca 1 Mall JC 10,11C,a Missouri limited liability company, and that said instrument was signed on behalf o said limited liability company, and said limited liability company acknowledged said instrument to be the free act and deed of said entity. WITNESS my hand and official seal this CD-L3day of_ ,2013. My Commission Expires ,-7;r?tttij blic JEAN MACKNEY Notary Publico-Notary Seal STATE OF MISSOURI County of Cole My Commisslon Expires 11/2712015 Comm ission#11500009 EXECUTION PAGE FOR PETITION FOR THE CREATION OF THE CAPI'T'AL MALL COMMUNITY IMPROVEMENT DISTRICT Name of owner. Capital Mall 1C11,LLC,a Missouri limited liability company Owner's telephone number: (573)635-2255 Owner's address:c/o Farmer Holding Company,221 Bolivar Street,Suite 400,Jefferson City,Missouri 65101 IF SIGNER IS DIFFERENT FROM OWNER. Name of signer: Tithe: Signer's telephone number: Signer's mailing address: If owner is an individual: Single Married If owner is not an individual,state what type of entity(Mark Applicable Box): Corporation General Partnership Limited.Partnership x Limited Liability Company Partnership Urban Redevelopment Corporation Not-for-Profit Corporation Other Map(see Exhibit B)and parcel number(s): 10-02-09-0002-001-005 Total Assessed value: $322,624 By executing this petition, the undersigned represents and warrants that he/she is authorised to execute this petition on behalf of the property owner named immediately below. Capital Mall JC11, LLC, a Missouri limited liability company By: `"'1 Name: '&a Title: 4uni-4,&CO ' ' v+n.►6 STATE OF MISSOURI ) (fit„ COUNTY OF ��]�,� On thisZt,Aay of 2013, before me appear to me personally known,who,being by me duly sworn did say that helshe is th f IC4 ital Mall JC11,LLC, a Missouri limited liability company, and that said instrument was signed oh behalf df said Limited liability company, and said limited liability company acknowledged said instrument o be the free""act and deed of said entity. WITNESS my hand and official seal this ;r day of=0 13, My Commission Expires D-7, D Public7Notary — — N MACKNEY ublic-Notaryry Seal =OF MISSOURI County of Cole My Commission Expires 11I2712015 Commission#11500009 EXHIBIT A LEGAL DESCRIPTION OF THE CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT Part of the South Half of Section 4, and part of the Northeast Quarter of the Northwest Quarter and part of the West Half of the Northwest Quarter of the Northeast Quarter of Section 9, all in Township 44 North,Range 12 W, in the City of Jefferson,Cole County, Missouri,more particularly described as follows: BEGINNING at the northeast corner of the West Half of the Northwest Quarter of the Northeast Quarter of said Section 9; thence S4'26'19"E, 760.31 feet to the northerly line of Old U.S. Route No. 50 (now Country Club Drive); thence S4°44'37"E, crossing said Country Club Drive right-of-way, 101.201 feet to a point on the southerly line thereof and said corner being the northwest corner of a tract of land described by deed of record in Book 136, page 132, and on the easterly boundary of a tract described by deed of record in Book 239, page 903, Cole County Recorder's Office; thence S4°34'31"E, along the easterly boundary of said tract described in Book 239, page 903, 375.37 feet to the southeasterly corner thereof, said comer being on the northerly line of U.S. Route No. 50; thence S75°33'03"W, along the northerly line of said U.S. Route No. 50, 77.73 feet; thence N88°24'20"W, along the northerly line of said U.S. Route No. 50, 125.05 feet to the southeasterly corner of a tract of land described by deed of record in Book 362, page 519, Cole County Recorder's Office; thence N7°5756"W, along the easterly boundary of said tract described in Book 362, page 519, 346.95 feet to the northeasterly corner thereof, said comer being on the southerly line of the aforesaid Country Club Drive; thence S77°59'08"W, along the southerly line (W of said Country Club Drive, 334.21 feet to the northwesterly comer of a tract of land described by deed of record in Book 315, page 773, Cole County Recorder's Office; thence S 14°07'00"E, along the westerly boundary of said tract described in Book 315, page 773, 273.73 feet to the southwesterly corner thereof, said comer being on the northerly line of the aforesaid U.S. Route No. 50; thence N88°24'20"W, along the northerly line of said U.S. Route No. 50, 765.43 feet; thence S75°24'00"W, along the northerly line of said U.S. Route No. 50, 36.12 feet to the southeasterly corner of a tract of land described by deed of record in Book 298,page 83, Cole County Recorder's Office; thence N3°07'58"W, along the easterly boundary of said tract described in Book 298, page 83, 96.22 feet to the northeasterly comer thereof, said comer being on the southerly line of the aforesaid Country Club Drive; thence continuing N3°07'58"W, 102.09 feet to the northerly line of said Country Club Drive; thence S78°00'23"W, along the northerly line of said Country Club Drive, 104.04 feet to the most easterly corner of the U.S. Highway 50 connection right-of-way described by deed of record in Book 240, page 660, Cole County Recorder's Office; thence, along the northerly line of said connection right-of-way, the following courses: N85°29'44"W, 264.86 feet; thence N49°07'58"W, 230.71 feet; thence N47°05'00"W, 313.86 feet to the easterly line of West Truman Boulevard(formerly known as North Ten Mile Drive); thence N8°34"28"E,along the easterly line of said West Truman Boulevard, 490.41 feet; thence N6°37'21"E, along the easterly line of said West Truman Boulevard, 401.12 feet to the northerly end of the aforesaid connection right-of-way; thence N79°05'18"W, 36.28 feet to the centerline of West Truman Boulevard (as described in Parcel 1 of the deed of record in Book 626, page 565 Cole County Recorder's Office); thence, leaving the aforesaid connection right-of-way line, described in Book 240, page 660, N3°27'09"E, along the centerline of West Truman Boulevard (as per said Parcel 1 description), 113.55 feet; thence N23°44'10"E, along the centerline of West Truman Boulevard (as per said EXHIBIT A-1 IL, Parcel 1 description), 233.03 feet to the southerly end of the property deeded to the City of Jefferson for the street right-of-way, now known as West Truman(formerly known as North Ten Mile Drive) as per deed of record in Book 275,page 214, Cole County Recorder's Office; thence N85°03'03"E, along the southerly line of said property described in Book 275, page 214, and along the southerly boundary of the property described by deed of record in Book 555, page 698, along the southerly boundary of El Mercado Development, Section 1, as per plat of record in Plat Book 11, page 402 and along the southerly boundary of those properties described by deeds of record in Book 529, page 947 and in Book 462, page 649, Cole County Recorder's Office, 1461.95 feet; thence N86°11'11"E, along the southerly boundary of said property described in Book 462, page 649 and along the southerly boundary of the property described by deed of record in Book 546, page 150, Cole County Recorder's Office, 692.99 feet to the southeasterly corner of said property described in Book 546, page 150 and said corner being on the westerly boundary of Monticello Acres, Section Nine, as per plat of record in Plat Book 11, page 859, Cole County Recorder's Office; thence S3°59'18"E, along the westerly boundary of Monticello Acres, Section Nine, 70095 feet to the southwesterly corner thereof, being a point on the south line of said Section 4, Township 44 North, Range 12 West,at the southeasterly comer of the property described by deed of record in Book 629, page 196,Cole County Recorder's Office; thence S86°32'02"W,along the Section Line, 389.43 feet to the POINT OF BEGINNING. L EXHIBIT A-2 J r EXHIBIT B BOUNDARY MAP OF THE CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT AND PROPERTY OWNERSHIP MATRIX — - - sun parte of nA cap"met Am I Al PROPE I - � __ y S ~,�+M�••:•�••^ 1 I r'M�srn.n�'rn7•-nw:ss�Wr�rmi� tW 80LOCOM sUWU w.�-- ..ms.µ �+`,I•y— �:x �� � . , ,. __� .. ...•, wraf ru.nrelm mr.ro EXHIBIT B-1 PROPERTY OWNERSHIP MATRIX PETITIONER OWNED PROPERTY NO. PARCELNUINBER Owner 2013 VALUE LAND IMP Total Assessed 1 10-02-09-0002-001-001 Capital Mall 1C1,LLC 5 7,080,100 $ 3,676,000 $3,404,100 $ 2,265,632 2 10-02-04-0004-000,025 Ca ital Mall JC4,LLC $ 3,300 $ 3,300 $ 1,056 3 10-02-040004-000.025,003 Capital Mall JC3,LLC $ 878,200 $ 878,200 $ 281,024 4 10-02-09-0001-001-024 Capital Mall JC7,LLC $ 197,300 $ 197,300 $ 63,136 5 1002-09-0002-001-004 Capital Mall 1C8,LLC $ 453,200 $ 190,800 $ 262,400 $ 1.45,024 6 1002-09-0001-001-022 Capital Mall JCS,LLC $ 1,000 $ 1,000 $ 320 7 1002-030002-001-002 Capital Mall JC9,LLC $ 221,400 $ 201,600 $ 19,800 $ 70,848 8 1002-04-0003-002-036 Capital Mall JC2,LLC $ 5,559,200 $ 1,766,400 $3,832,800 $ 1,791,744 9 1002-0&0002-001-006 Ca ital Mall JC10,LLC $ 576,500 $ 331,900 $ 244,600 $ 184,480 10 10-02-09-00D2-001-005 Ca ital Mall JC11,LLC $ 1,008,200 $ 504,400 $ 503,800 $ 322,624 11 10-02-09-0001-002-011 ICapitai Mall JC6,LLC I$ 110,000 $ 110,000 $ 35,200 OTHER PARCELS NOT OWNED BY NO. PARCEL NUMBER DESCRIPTION 2013 VALUE LAND IMP Total Assessed 12 10-02-04004000025,004 Theater Im mements $ 1,270,500 $1,270,500 $, 406,560 13 10-02-030002-001-003 Wendy's Building $ 450,200 $ 4150,200 $ 144,064 14 1002-040003-002-037 J C Penney Land&Improvements $ 2,310,500 $ 1,315,500 $ 995,000 $ 739,360 15 1002-09-0001-001-023 Dillards Land&Improvements $ 2,719,300 $ 1,188,300 $1,531,000 $ 870,176 16 1002-040004-000-025,001 Ddlards Additional Parkin Area&Land $ 645,700 $ 547,500 $ 98,200 $ 206,624 TOTAL ASSESSED VALUE $ 7,527,872 TOTAL PETITIONER-OWNED ASSESSED VALUE $ 5,161,088 PERCENTAGE OF PETITIONER-OWNED ASSED VALUE OVER TOTAL ASSESSED VALUE 69% NUMBER OF OWNERS 15 (W NUMBER OF PETITIONER-OWNED PARCELS 11 PERCENTAGE OF PETITIONER-OWNED PARCELS OVER TOTAL NUMBER OF PARCELS 73% EXHIBIT B-? D EXHIBIT C FIVE YEAR PLAN (Attached) I I� EXHIBIT C FIVE YEAR DISTRICT MANAGEMENT PLAN OF THE CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT CITY OF JEFFERSON, MISSOURI The information and details outlined in the following pages represent the strategies, and activities that it is anticipated will be undertaken during the initial five-year duration of The Capital Mall Community Improvement District in Jefferson City, Missouri. It is an integral and composite part of the petition to establish The Capital Mall Community Improvement District. EXHIBIT C-I Introduction The Capital Mall Community Improvement District (the "District") is created pursuant to Section 67.1401 through 67.1571 of the Revised Statutes of Missouri (the "CID Act"). Section 67.1421, RSMo, requires that the petition for the creation of the District be accompanied by a five-year plan which includes a description of the purposes of the proposed district, the services it will provide, the improvements it will make and an estimate of the costs of these services and improvements to be incurred. This Five-Year District Management Plan (the "Plan") is intended to satisfy this statutory requirement, and is appended to the Petition for Formation of the District as an integral part thereof. Section 1 - Why Create a Community Improvement District? The District will encompass a proposed mixed-use development located at the northeast corner of Highway 50 & S. Country Club Dr./W. Truman Blvd. in Jefferson City, Missouri in Jefferson City, Missouri (the "Development'). The purpose of the District is to undertake certain public and private improvements and provide services within the District, as discussed below, and to use or make available its revenue to pay the costs thereof, including without limitation debt service on any notes, bonds or other obligations issued and outstanding from time to time to finance all or any of such costs. Section 2 -What is a Community Improvement District? A community improvement district is an entity that is separate from the City of Jefferson and is formed by the adoption of an ordinance by the City Council following a public hearing before the City Council regarding formation of the District. A CID may take the form of a political subdivision of the State of Missouri, or a nonprofit corporation that is formed and operated under Missouri corporation laws. CIDs are empowered to provide a variety of services and to construct andJor finance a number of different public improvements (and in a blighted area, private improvements). CIDs derive their revenue from taxes and assessments levied within the boundaries of the CID. Such revenues are then used to pay the costs of the services or improvements. A CID is operated and managed by a board of directors, whose members may be appointed or elected. Board members serve for a designated period of time, and the Board positions are again elected or appointed at the expiration of each term. Section 3 -Management Plan Summary The District in this case will take the form of a separate political subdivision of the State of Missouri, which will be governed by a Board of Directors that will consist of five (5) members appointed by the Mayor of Jefferson City with the consent of the City Council pursuant to a slate submitted in accordance with the Petition. (W EXHIBIT C-2 District Formation: CID formation requires submission of signed petitions from a group of property owners: • collectively owning more than fifty percent (50%) by assessed value of the real property within the District,and • representing more than fifty percent (50%) per capita of all owners of real property within the District. In this case, the Petition to which this Plan is attached has been signed by the owners of over 50% of the assessed value and over 50%of the per capita property owners within the District. Location: The Development consists of ±78.26 acres and is located at the northeast corner of Highway 50 & S. Country Club Dr./W. Truman Blvd. in Jefferson City, Missouri. The District will include the existing and expanded commercial development. Assessed Vahie of District: The total assessed value of the properties within the District on the date of the Petition is $8,597,182. Improvements, Services, Formation and Operation Costs: The purpose of the District is to provide funding for the construction of certain public and private improvements, provide, at the discretion of the Board, certain services within the District's boundaries, and otherwise carry out the powers set forth in Section 67.1401 to 67.1571, RSMo. Improvements: The public and private improvements initially contemplated to be incurred by the District include repaving, renovating, resurfacing, installing adequate lighting and repairing existing lighting to the parking lots, renovating and rehabilitating the Capital Mall structure and related private improvements, and constructing, reconstructing, installing, repairing, maintaining and equipping certain public improvements within the District (the "Improvements"), such Improvements to include, without limitation: (a) renovating, reconstructing and repairing improvements to the exterior, interior and within common areas of the Capital Mall building and the District, (b) installing, repairing, and, as applicable, resurfacing common driveways, access roads, sidewalks, curbs, signs, streetlights, landscaping and parking areas, and (c) repairing and replacing storm. sewers. The particular items included within the Improvements may be increased or amended from time to time and the costs of the Improvements to be financed by the District shall include all associated design, architecture, engineering, financing, private interest carry, legal and administrative costs of same. EXHIBIT C-3 • Services: The District may also fund the provision of services within its Y boundaries for the benefit of the owner and tenants of the District (the "Services"). Subject to the discretion of the District's Board of Directors, those Services and costs are not presently contemplated to be incurred within the first five (S) years of the District's existence. Services contemplated herein may include, without limitation: (a) maintaining the common driveways and access roads, sidewalks, curbs, signs, streetlights, landscaping and parking areas; (b) causing the necessary engineering and planning to be performed in connection with the Services; (c) providing for the services of streetscaping, gardening and landscaping (including but not limited to purchasing, installing and maintaining trees, shrubs, flowers and other vegetation, maintaining pots and planters, planting and replacing trees located along or adjacent to public rights-of-way and private drives, installing and maintaining lighting, public art, mowing, seeding and fertilizing grass and other vegetation); (d) maintaining, repairing or replacing irrigation systems and fire protection systems; (e) maintaining or repairing sanitary and storm sewers; (f) repairing, lighting, restriping, and resurfacing the parking lots; (g) providing or contracting for the provision of cleaning and maintenance services for exterior common areas in order to improve the appearance and image of the District, including but not necessarily limited to litter removal, purchase and maintenance of trash receptacles, cleaning and sweeping of sidewalks, streets, parking areas, private drives, and gutters; (h) providing for snow and ice removal; (i) providing for trash, garbage, and other refuse removal; (j) repairing and maintaining directional and pylon signs; (k) repainting and repairing exterior areas; (1) repair, replace and maintenance of exterior building and canopy lighting systems and components; (m) maintenance of roofs, gutters, downspouts, fascia and columns; (n) the cost of non- administrative personnel (including, without limitation, workers compensation insurance) to implement such services; (o) employing or contracting for the provision of personnel to assist landowners, occupants, and users to improve security and safety conditions within the District, including but not limited to addressing public safety concerns, identifying and reporting public nuisances, and (if deemed advisable by the District) conducting security patrols; (p) hiring or contracting for personnel to staff and provide services to the District, and (q) contracting for, procuring, and paying for tenant relocation costs in an effort to recruit businesses to the District and retain businesses within the District. The District anticipates providing Services to assist in reducing the high operating costs within the District. • Formation and Operation Costs: The District may also provide funding for the District's formation costs and ongoing operation and administration costs on an annual basis (respectively, "Formation Costs" and "Operating Costs"). Formation Costs shall include all, including attorney's fees, associated with the preparation of the CID Petition and negotiation and drafting of any agreements to form the District or further the District's purpose, and such costs shall be reimbursed to the advancing party, or paid directly, from funds generated by the District. Ongoing Operation Costs include, without limitation, contracting for the employment or employing managerial, engineering, legal, technical, clerical, EXHIBIT C4 accounting or other assistance as deemed advisable by the Board, and may be included as an annual expense item by the CID Board. Method of Financing: It is proposed that the District will impose a one percent (1%) sales and use tax (the "District Sales Tax"), which is in addition to any other state, county or city sales and use tax. The District Sales Tax is payable on the same retail sales that are subject to taxation pursuant to Sections 144.010 to 144.525, RSMo, except sales of motor vehicles, trailers, boats or outboard motors, and sales to or by public utilities and providers of communications, cable, or video services. All costs of the District shall be financed in the manner and amount determined by the Board of Directors from the amounts on deposit with the CID. Amounts advanced to the District by the Petitioner, or its successors or assigns, to cover the costs contemplated hereunder will be reimbursed by the District upon the availability of funds. All financing costs, including interest costs, associated with any loan obtained by the District, or notes, bonds, or other obligations issued by District to finance Improvements and/or Services may be paid from CID Sales Tax revenues. Estimated Costs: Attached as Exhibit A to this Plan is a table setting forth the estimated cost of the Improvements, and a table setting forth the projected cash flow for the first five years of the District's existence. City Services: (W The CID Act mandates that existing City services will continue to be provided within a CID at the same level as before the District was created (unless services are decreased throughout the City) and that District services shall be in addition to existing City services. The District anticipates that City services will continue to be provided within the District at the same level as before the District was created, and the District will not cause the level of City services within the District to diminish. Duration: The District will operate for a maximum term of forty (40) years from the date of the ordinance approving the Petition. Notwithstanding that the District is at the time providing Services, but subject to the contractual rights of any third parties, the District may be terminated prior to the end of such maximum forty (40) year term if the Improvements have been completed and the costs thereof paid for or reimbursed in full with CID Sales Tax revenue. The petition process must be repeated for the District to continue beyond forty(40)years. Section 4 District Boundaries The legal description of the District is attached as Exhibit A to the Petition. EXHIBIT C-5 Section 5 Facilities and Services to Be Provided As explained above, during the first five years, the purpose of the District is to provide revenue sources in support of contracting with any private property owner to effectuate the Improvements, and providing or contracting for the Services. Section 6 Governing the Community Improvement District City Council: Following the submission of the Petition, the City Council will conduct a public hearing and then consider an ordinance to create the District. Board of Directors for District: The District will be governed by a Board of Directors that will consist of five members appointed by the Mayor of Jefferson City with the consent of the City Council. It is anticipated that if the District submits names of suggested successor directors to the City in writing at least thirty (30) days prior to the expiration date of the terms of the applicable directors, the Mayor shall appoint such directors as successor directors, with the consent of the City Council, unless the Mayor provides the District with a reasonable written explanation that such suggested successor directors do not meet applicable legal requirements or lack the competency to serve as directors. Annrtal Budget: The District's budgets will be proposed and approved annually, within the limitations set forth in this Plan, by the District's Board of Directors. Budgets will be submitted annually to the City Council of the City of Jefferson City for review and comment in accordance with the CID Act. The District will operate at all times in accordance with the District Rules and Regulations(Section 7) and the Bylaws of the District. Cooperation Agreement: It is anticipated that the District will enter into a Cooperation Agreement with the Petitioner and the City effectuating the terms of the CID Petition and this Plan, and otherwise governing the operation of the District and the imposition and collection of the District Sales Tax (the"Cooperation Agreement"). EXHIBIT C-6 Section 7 District Rules and Regulations 1. The District shall operate at all times in accordance with Bylaws that may be adopted by the Board of Directors. The District shall at all times conduct its proceedings in accordance with Robert's Rules of Order, except as otherwise provided in any Bylaws. 2. The Board of Directors of the District will meet at least on an annual basis. END OF DOCUMENT EXHIBIT C-7 EXHIBIT A TO FIVE YEAR PLAN OF THE CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT ESTIMATED COSTS OF IMPROVEMENTS Total Pro jed CID 1% Development Costs Costs Bain Tax Land Acquisition $ 11,000,000 $ Hard Construction Costs $ 20,316,500 $ 4,091,537 Parking Lot Renovations $ 1,500,000 $ - Solar Panels $ 115,000 $ - Common Area HVAC Units S 202.500 S 101 250 Replacement RMUs $ 500.000 $ 250 000 Waferproofing $ 18,000 $ - Exterior Landscaping $ 150,000 $ Interior CAM Painting $ 45,000 $ Common Area Ceiling/Lighting $ 300,000 $ - Inlorior Landscaping $ 100,000 $ Interior Furniture Seating Area $ 36,000 $ - Mall Entrances $ 1,000,000 $ 1,000,000 Exlerior Improvements $ 1„000,000 $ 500,000 Interior Fagade Improvements $ 750,000 $ Pylon Signs $ 250,000 $ Roofing Replacement $ 1,200,000 $ 684,867 Replace Common Area Floor $ 850,000 $ 425,000 Annual Maint-IRepairs $ 2,300,000 $ - CA and TI Improvement $ 10,000,000 $ 1,130,420 Soft Renovation Costs $ 3,115,825 $ 1,000,000 Archii1ectural&Engineering $ 350,000 $ 125,000 General Conditions $ 100,000 $ 50,000 Taxes, Insurance,Appraisal $ 50,000 $ 25,000 Financing Costs/ConsL Interest $ 1,000,000 $ 200,000 Administrative/Overhead $ 300,000 $ 268.618 Legal $ 250,000 $ 75,000 Survey $ 50,000 $ 25,000 Developer Fee $ 1.015,625 $ 231,382 Contingency $ 2,451,650 $ Hard Cost Contingency(10%) $ 2,031,650 $ - Soft Cost Contingency 20% $ 420,000 $ Total Development Costs $ 36,883,975 T 5,091,537 These costs are estimates and may fluctuate based on actual costs incurred for purposes permitted under the CID Act. EXHIBIT C-8 EXHIBIT A TO FIVE YEAR PLAN OF THE CAPITAL MALL COMMUNITY IMPROVEMENT DISTRICT CASH FLOW PROJECTIONS YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 (2014) 2015) 2016 (2017) (2018 ESTIMATED REVENUE' '078,914 $400,816 $421,671 $443,371 $465,287 ESTIMATED EXPENSES ($378,914) ($400,816) ($421,671) ($443,371) ($465,287) Estimated Formation Costs ($75,000) Estimated Operation Costs ($10,000) ($10,000) ($10,000) ($10,000) ($10,000) Improvements 1 ($293,914) 1 ($390,816) ($411,671) 1 ($433,371) 1 ($455,287) `Any annual revenue generated will be utilized to pay any costs of the District in the discretion of the Board of Directors.Above is an estimate of the revenues and expenses for the District,which is subject to change as revenue is received and expenses are incurred. EXHIBIT C-9 1 EXHIBIT D BLIGHT STUDY (Attached) EXHIBIT D Valbridge PROPERTY ADVISORS Blight Study Report Capital Mall 3600 Country Club Drive Jefferson City, Cole County, Missouri, 65109 FOR Farmer Holding Company Rob Kingsbury 221 Boliver Street, Suite 400 Jefferson City, Missouri, 65101 Client ID: 42415698.4 • •• - • •- 11 • • - Valbridge Job No.: 12638 i Va I bridge PROPERTY ADVISORS Shaner Appraisals,Inc. July 30, 2013 Mr. Rob Kingsbury Farmer Holding Company 221 Boliver Street, Suite 400 Jefferson City, Missouri, 65101 Re: Blight analysis of the Capital Mall located at the 3600 Country Club Drive in Jefferson City, Cole County, Missouri 65109. Shaner File Number: 12638 Dear Mr. Kingsbury: I am pleased to transmit the attached Blight Study Report that has been prepared for the above referenced property. The purpose of this report is to determine whether the Study Area is blighted, as defined in Section 353.020, Section 67.140, and Section 99.805 Revised Statutes of Missouri. This analysis represents an accumulation of my findings based on research and investigations performed as of the report's effective date, December 9, 2012.The attached report sets forth the data, research, investigations, analyses, and conclusions for this report. The Study Area is comprised of 14 parcels with a total site area of 78.27 acres of land. The Study Area is presently a combination of both unimproved land and Improved structures that are being utilized for retail purposes such as banking,food service,and other general retail uses. As determined in the following study, it is my opinion that the Study Area represents a "blighted area" as is defined in Section 353.020 of the Missouri Redevelopment Corporations Law and in Section 99.805 of the Real Property Tax Increment Allocation Redevelopment Act of the Revised Statutes of Missouri. Primary blighting factors include: Age and obsolescence Inadequate or outmoded design • Physical deterioration/deterioration of site improvements • Defective or inadequate street layout • Unsanitary or unsafe conditions • Improper subdivision and/or obsolete platting • Conditions endangering life or property by fire and other causes As a result of the age, obsolescence, inadequate and outmoded design and physical deterioration the Study Area has become and economic and social liability and those conditions are conducive to the inability to pay reasonable taxes. Therefore, it is my opinion that the Study Area is a blighted area as defined in Section 353.020 of the Revised Statutes of Missouri. Further, it is my opinion that the Study Area is a blighted area as defined in Section 99.805 of the Revised Statutes of Missouri because the Study Area suffers from the predominance of defective and inadequate street layout, unsanitary and unsafe conditions, improper subdivision and obsolete platting, deterioration of site improvements, and Mr. Rob Kingsbury .July 30,2013 Page 2 conditions endangering life and property by fire and other causes and as a result of such factors the Study Area constitutes an economic and social liability and a menace to the public health and safety in its present condition and use. I have reached these conclusions based on the facts shown in the following report. This letter is invalid as an opinion of blight if detached from the report, which contains the text, exhibits and Addenda. Sincerely, Shaner Appraisals,Inc. 5�a Jason Roos, MAI Director State Certified General Appraiser,Missouri No.2009011367 42415698.4 Capital Mall Blight Study Certification I certify that, to the best of my knowledge and belief. • The statements of fact contained in this report are true and correct. • The reported analyses, opinions, and conclusions are limited only by the reported assumptions and limiting conditions, and are my personal, impartial and unbiased professional analyses, opinions and conclusions. • I have no present or prospective interest in the property that is the subject of this report, and no personal interest with respect to the parties involved. • I have no bias with respect to the property that is the subject of this report or to the parties involved with this assignment_ • My engagement in this assignment was not contingent upon developing or reporting predetermined results. Furthermore, my engagement was not conditioned upon the report producing a specific opinion of blight or the approval of any public incentives or the approval of a loan. • My compensation for completing this assignment is not contingent upon the development or reporting of a predetermined opinion of blight that favors the cause of the client, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this report. • The reported analyses, opinions, and conclusions were developed, and this report has been prepared, in conformity with the requirements of the Code of Professional Ethics and Standards of Professional Practice of the Appraisal Institute, which include the Uniform Standards of Professional Appraisal Practice. • The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives. • Laird Goldsborough, MAI, MRE provided assistance to the person(s) signing this certification. • Jason Roos, MAI made a personal inspection of the property that is the subject of this report. • As of the date of this report, Jason Roos, MAI has completed the continuing education program of the Appraisal Institute. • I have performed no services, as an appraiser or in any other capacity, regarding the property that is the subject of this report within the three-year period immediately preceding acceptance of this assignment. Jason Roos, MAI State Certified General Appraiser,Missouri No.2009011367 SHAKER APPRAISALS,INC. Certification 4241-5698.4 Capital Mail Blight Study EXTRAORDINARY ASSUMPTIONS AND HYPOTHETICAL CONDITIONS Extraordinary Assumption: An assumption, directly related to a specific assignment, which, if found to be false, could alter the appraiser's opinions or conclusions. Extraordinary assumptions presume as fact otherwise uncertain information about physical, legal, or economic characteristics of the subject property; or about conditions external to the property such as market conditions or trends; or about the integrity of data used in an analysis. There are no extraordinary assumptions employed in this report. Hypothetical Condition: That which is contrary to what exists but is supposed for the purpose of 1 analysis. Hypothetical conditions assume conditions contrary to known facts about physical, legal, or economic characteristics of the subject property; or about conditions external to the property, such as market conditions or trends; or about the integrity of data used in an analysis. There are no hypothetical conditions employed in this report. OTHER CONDITIONS 1. None SHANER APPRAISALS,INC. Extraordinary Assumptions and Hypothetical Conditions 4'4156()8.4 Capital Mall Blight Study 140- INTRODUCTION Identification of the Property Description The subject consists of 14 parcels located generally near 3600 Country Club Drive, Jefferson City, Cole County, Missouri, although each parcel has a separate address. The subject contains four parcels of vacant land and seven parcels that have been improved with retail buildings. The following table summarizes the 14 parcels. Parcel Size Parcel Size Building Parcel Ades Parcel ID Number S Acres Zoning Size(SF) Current Status 1 3600 Country Club Drive 1002090002001001 1,225,343 28.13 C-1 290,407 Improved with Capital Mall 2 3546 Country Club Drive 1002040004000025 355,450 8.16 C-1 - Vacant Land 3 3550 Country Club Drive 1002040004000025003 219,542 5.04 C-1 26,390 Improved with Movie Theater 4 3524 Country Club Drive 1002090001001024 65,776 1.51 C-1 - Vacant Land 5 3530 Country Club Drive 1002090002001004 31,799 0.73 C-1 2,415 Improved with Restaurant 6 3516 Country Club Drive 1002090001001022 105,851 2.43 C-1 - Vacant Land 7 3536 County Club Drive 1002090002001002 29,621 0.68 C-1 - Ground Lease with Restaurant 8 3721 West Truman Blvd. 1002040003002036 353,272 8.11 C-1 - Ground Lease with Grocery Store 9 3601 Country Club Drive 1002090002001006 55,321 1.27 C-1 3,820 Improved with Restaurant 10 3533 Country Club Drive 1002090002001005 84,071 1.93 C-1 4,285 Improved with Bank 11 3515 Country Club Drive 1002090001002011 74,923 1.72 C-1 - Vacant Land 12 3600 Country Club Drive 1002040003002037 328,743 7.55 C-1 61,940 IC Penney's 13 3600 Country Club Drive 1002040004000025001 182,594 4.19 C-1 - Improved with Parking 14 3600 Country Club Drive 1002090001001023 297,118 6.82 C-1 73,238 Dillard Total 3,409,423 78.27 462,495 Identification of the Problem Purpose The purpose of this blight study is to investigate and determine if blight conditions exist in the proposed Study Area according to Missouri's Urban Redevelopment Corporations Law and Real Property Tax Increment Allocation Redevelopment Act as defined below. Definitions Missouri Urban Redevelopment Corporations Law, Section 353.020 (2), RSMo. - "Blighted area", that portion of the city within which the legislative authority of such city determines that by reason of age, obsolescence, inadequate or outmoded design or physical deterioration have become economic and social liabilities, and that such conditions are conducive to ill health, transmission of disease, crime or inability to pay reasonable taxes. Missouri Real Property Tax Increment Allocation Redevelopment Act, Section 99.805(1), RSMo.— "an area which, by reason of the predominance of defective or inadequate street layout, unsanitary or unsafe conditions, deterioration of site improvements, improper subdivision or obsolete platting, or the existence of conditions which endanger life or property by fire and other causes, or any combination of such factors, retards the provision of housing accommodations or constitutes an economic or social liability or a menace to the public health, safety, morals,or welfare in its present condition and use." (w, SHANER APPRAISALS,INC. Introduction • 1 42415698.4 Capital Mall Blight Study Effective Date The effective date of this blight study is December 9, 2012. The property was inspected by Jason Roos, MAI on December 9, 2012. Date of Report The date of this report is January 31, 2013. A comparison of the date of the report to the effective date of the blight study indicates that our conclusions are reflective of current market conditions. Use or Function This blight study was prepared for the sole and exclusive use of Farmer Holding Company to assist in determining if the Study Area is blighted and eligible for tax abatement and/or TIF and CID.It is not to be relied upon by any third parties for any purposes, whatsoever; provided, however, this Report may be submitted by Farmer Holding Company or its affiliates or agents to any governmental entity or agency for the purpose of making a recommendation of a finding that the Study Area is blighted or a legislative determination and/or finding that the Study Area is blighted. Appraiser Competency No steps were necessary to meet the competency provisions established under USPAP. Our firm has completed many blight studies in the past several years, and we have adequate experience and qualifications to complete the study. Please refer to the Appraiser Qualifications at the end of our report. Sources of Information Market data was obtained from a number of sources, including but not limited to the following: • The Site-To-Do-Business • The Cole County Assessor's Office • Jefferson City online databases • Cole County online databases • Jefferson City Chamber of Commerce • Jefferson City Economic Development department • The Labor of Bureau Statistics • The U.S. Census Bureau • Loopnet, CoStar, Multiple Listing Service (MLS), and in-house database SHANER APPRAISALS,INC. Introduction • 2 42415698,4 Capital Mall Blight Study AREA AND NEIGHBORHOOD Area Overview The subject is located in the western portion of Jefferson City, Cole County, Missouri. Jefferson City is the state capital of Missouri and is located approximately midway between Kansas City and St. Louis. Major highway access in the community is provided by US Highway 50, which runs east/west through the community and US Highway 63 which runs north/south. According to the Site to Do Business, Jefferson City had an estimated 2012 population of 43,506 people with a median household income of $46,525. This represents a population increase in Jefferson City of 0.44% annually from 2010 to 2012. In comparison, the Kansas City metro has a median housing income of $51,835 in 2012 and a reported population growth of 0.60% annually since 2010. The following analysis focuses on the social, economic, government, and environmental forces that form the elements of supply and demand and subsequently affect local real estate values. Area Ma 'rn.5rn na•rnw. Bannm.M • �,nMsr � �^I b.lOh WYep.. M.Nri.Y ,Snrywna /.I,gaa ga11yYN�� - '� ,fin � ev Ma.lemon, �IINr '' I! .r.w I L t 1 4 O I F Sam I hWtY C.I 4 i •wr" "� f U N I T E 0 9 T A T E F r.nY.n InYf nP z unn rronnr5. M 1 5 5 U U A I m t Na Je�y; saran Case www; Y� femurniN SVnnn. lot.n 'marry Gua! La. ' 15 Lr.wurn P.nu �PaaMrw fanli«In' Xrvvr�'. ° 5 /MiUIY\.• flr�nlNdn ii MWn 'Irnvnr I ielwa, ..evrw .un.. nY..a,..a , s.Ya Isnnnn rY,Pan, 1 ornNxu 'i Canbmlla J.'f�.R nue Cp _ ae,wen LL 'YµN UY raM CM �~ • wwaam ..,....« d rr.am.N avN.v.inan eo aenaf 4 n. Market Area Overview According to Market Analysis for Real Estate, published by the Appraisal Institute,the trade/market area is delineated by physical, political, and socioeconomic boundaries or by the time-distance relationship represented by travel times to and from common destinations. A market area is an area in which [ alternative, similar properties effectively compete with the subject in the minds of probable, potential �r SHANER APPRAISALS,INC. Area and Neighborhood a 3 Capital Mail Blight Study users. It is further stated that the time-distance relationship to employment and support facilities is the primary determination for retail properties. Therefore, for the purposes of this report, the market area boundaries are considered to be the entire city of Jefferson City. The market area is shown on the following map. Market Area Ma Land Use Land use in the immediate area of the subject includes mostly commercial and single family residential. The main commercial corridor in the subject's neighborhood is West Truman Blvd. and US Highway 50, which intersect at the southwest corner of the subject property. Significant land use characteristics are summarized in the following table for the immediate area. Predominant Age of Improvements 30 years Predominant Quality and Condition Average Approximate Percent Developed (estimate) >75% with vacant sites being located throughout the area Life Cycle Stage Second,a period of stability Infrastructure/Planning Average Prevailing Direction of Growth West Immediate Surrounding Land Use North Commercial South Hihwa East Residential West Commercial SHANER APPRAISALS,INC. Area and Neighborhood 4 Capital mall Blight Study Market Area Aerial Map I Plot a ' A - --- I + 4. Access Regional access to and from the local market area is good due to the presence of US Highways 63 and 50. US Highway 50 runs east/west through the area and connects with Interstate 470 and Kansas City to the west and Interstate 44 and St. Louis to the east. US Highway 63 runs north/south through the area and connects with Interstate 70 and Columbia, Missouri to the north and Interstate 44 and Rolla, Missouri to the south. Outlook and Conclusions I am cautiously optimistic about both the short and long-term outlooks of the subject market area. Jefferson City is the state capital of Missouri and as such, will continue to have a solid employment base of government jobs. Although that is the case, there is still a risk factor involved that includes the potential cut in government spending, which would have a negative impact. The location along two US Highways is also a positive for the community and the market will remain stable for the foreseeable future with few changes occurring. SHAKER APPRAISALS,INC. Area and Neighborhood • 5 Capital Mall Blight Study PROPERTY DATA Site Description Identification Location—Main Parcel 3600 Country Club Drive,Jefferson City, Cole County, Missouri Abbreviated Legal Please see the Addenda for an abbreviated legal descriptions Ph sical Features Size(11 Parcels Combined) Approximately 78.27 acres, or 3,409,423 square feet Source; County Records Configuration Irregular(see following maps, aerials and siteplans) Topography Basically level Draina a Adequate at the time of inspection Flood Plain Community Panel# 29051C0109E, effective November 2, 2012 Zone X, "Areas of 0.2% annual chance flood; areas of 1% annual Flood Zone chance flood with average depths of less than 1 foot or with drainage areas less than 1 square mile; and areas protected by levees from 1%❑annual chance flood." Flood Insurance Not typically required within Zone X Utilities Adequate utilities are available and in place at the site. Our physical inspection of the subject property did not reveal any Environmental indication of environmental hazard. However, we were not provided with a Phase I report to verify. It is recommended that a competent third party prepare a Phase I to confirm. We were not provided a soil report to review. We assume that the Ground Stability soil's load bearing capacity is sufficient to support the existing structures. We did not observe any evidence to the contrary during our physical inspection of the property. Le al Zoning Designation PUD, Planned Unit Development/C-1, Neighborhood Commercial The zoning of property is Planned Unit Development. The purpose of this district is to provide land use and design flexibility in exchange for Statement of Intent long term community benefits where streets and utilities are adequate and where proposed development is compatible with existing and planned development on adjacent property. Conformance The subject property is in conformance with the zoning requirements. Easements, We do not know of any easements, encroachments, or restrictions that Encumbrances, would adversely affect the site's use. However, we were not provided Moratoriums with a title report to verify. It is recommended that a competent third party prepare a title report to veri . An inspection of the site revealed no apparent encroachment(s). Encroachments However, we were not provided with a site survey. It is recommended that a competent third party prepare a survey to verify. SHANER APPRAISALS,INC. Property Data • 6 Capital Mall Blight Study GIS Parcel Map a rA S �A . .�( •l. ;rows ;C- - * 3 •-,�rl � . oda 114 1h + - ' 11 ti. SHANER APPRAISALS,INC. Property Data 7 Capital Mall Blight Study Zonin Ma Subject ,� cl may - � I ]effarson City Zoning C-1 C-z ■C-3 . C-4 . C-O M-1 .M-2 M-3 ®N-O NC PU© RA-1 .RA-2 ■RC ■RD ❑R5-1 R5-2 RS-3 ®RS-4 RU SHANER APPRAISALS,INC. Property Data • 8 Capital Mall Blight Study Flood Map S^�'�^�p PROPERTY ADDRESS: T �, BO)I'� I 3604 Country C.ub Dr,Jefferson City M0•LS 1:9 FL-DODS 1RCE FLOODSCAPE- j 40 North r r � e • r: # FLOADSC-APE- Flood R-mards Map Map N.rrber 2605iG9�veE EAech"Date t h.-oe dw l- 2012 . 1 - Fkvad Legend e ■High 9ocd risk t r Moderate tlootl rsk t SI Low loco rt$k R'• I T117 RSM:r'�!S AS �rr eacq a^a s&Wrcn $TI)Bontlnexorn ff Dae 574.1224 =sv!!ry FsxSa.r:e fi-T.".aLCaG rw.rcamtl+eKa.wn r3;-3•�_i..o�ze�ase COnralk•�.Ai r,h°s-esenetl Fc.tcle�l+} aari�e Yu•r6trs E5313rS6.6+67E815,5N289b any iEtli SHAKER APPRAISALS,INC. Property Data 9 Capital Mall Blight Study Site Conclusions The subject site is functional for its legally permissible use of a retail development.The site is favorable for its current retail use and has good general access to main transportation routes in Jefferson City and utilities.The use of the property is consistent with the surrounding development. SUBJECT PHOTOS a r _ View of exterior of Capital Mall I IL SHANERAPPRAISALS,INC. Subject Photos • 10 Capital Mall Blight Study El View of exterior of Capital Mall i AL r s View of exterior of Capital Mall SHANER APPRAISALS,INC. Subject Photos 11 Capital Mail Blight Study r 1 � View of exterior of Capital Mall View of exterior of Capital Mall SHANER APPRAISALS,INC. Subject Photos • 12 Capital Mall Blight Study Owl- View of exterior of Capital Mall w SHAKER APPRAIsALs,INC. Subject Photos 13 Capital Mall Blight Study View of interior of Ca ital Mall View of interior of Capital Mall SHANER APPRAISALS,INC. Subject Photos • 14 WNWr . . . .. CapitalBlightStudy r r View of ra interiorof Capital f SHANER APPRAISALS,INC. V�ew of interior of Capital Mall � -`mss •,~ _ � , . „ 4. �::(� `.'�1 • Subject ! r 5 I loi AN _, 1 amsbuo f !M T y`i i 1 1 _ Capital Mall Blight Study :111, ��►'� - ti �i �► Y F ,r View of interior of Capital Mall View of interior of Capital Mall SHANER APPRAISALS, INC. Subject Photos 18 Capital Mall Blight Study _ d View of Pizza HLA OUtparcel - - — w� n r a View of Wendy's outparcel SHAKER APPRAISALS,INC. Subject Photos • 19 Capital Mall Blight Study View of movie theater outparcel _ � P View of I•iardee's outparcel SHANER APPRAISALS,INC. Subject Photos • 20 Capital Mail Blight Study View of bank out•arcel ��: �..� 1 '��• 'moi.. i. . �'`. SHANER AppmSALS,INC. View 1 r 1. +w of f Subject • • F Capital Mail Blight Study ''� V '-maw•Iwo.: '+'__ 4.�.f y.�T:�=T_ 7 View of vacant f f Subject PhotosSHANER APPRAISALS,INC. View of vacant Capital Mall Blight Study r View of vacant land View of vacant land SHANER APPRAISALS,INC. Subject Photos + 23 Capital Mall Blight Study BLIGHT ANALYSIS Blight Defined As presented earlier, Section 353.020 (2) R.S.Mo of Missouri's Urban Redevelopment Corporations Law defines a "blighted area" as follows: • "Blighted area", that portion of the city within which the legislative authority of such City determines that by reason of age, obsolescence, inadequate or outmoded design or physical deterioration have become economic and social liabilities, and that such conditions are Conducive to ill health, transmission of disease, crime or inability to pay reasonable taxes. We also presented the definition of blight from the Missouri Real Property Tax Increment Allocation Redevelopment Act, Section 99.805(1), RSMo which defines a "blighted area"as follows: • an area which, by reason of the predominance of defective or inadequate street layout, unsanitary or unsafe conditions, deterioration of site improvements, improper subdivision or obsolete platting, or the existence of conditions which endanger life or property by fire and other causes, or any combination of such factors, retards the provision of housing accommodations or constitutes an economic or social liability or a menace to the public health, safety, morals, or welfare in its present condition and use. The above definitions serve as the basis for further discussion concerning whether the proposed Study Area is blighted, Chapter 353--Factors# 1 and 2—Age and Obsolescence The Study Area includes both improved and unimproved sites. For the unimproved sites, since land does not depreciate or age over time similar to improved property, and age is not considered to be a significant indication of blight for these parcels. There are nine structures on the 14 parcels. Each of these structures was built in a different year and is subject to different amounts of depreciation. The Capital Mall parcel (Parcel 1)contains the majority of the building area in the Study Area at approximately 63% and was built in 1978. In our inspection of this building, there were a number of areas that had dated improvements. These include the floor tile throughout the common areas and the tile in the restrooms. There are several places in the mall that have tiles that are mismatched in color, possibly due to the lack of similar tile to repair areas of the floor. Photos of these items can be seen on the following pages. The Merriam-Webster Dictionary defines "obsolescence" as "the process of becoming obsolete or the condition of being nearly obsolete" and "obsolete" as "of a kind or style no longer current: old- fashioned." In a retail shopping center similar to the subject, keeping the common areas updated appeals to both the shoppers and the tenants. Shoppers generally have more desire to be at a center that appears "newer' and that has more up-to-date amenities. By making the subject mall more aesthetically pleasing to these shoppers, traffic to the mall should increase and may increase the occupancy with tenants that would appeal to these shoppers. Tired and outdated malls have difficulty attracting tenants that will draw shoppers to the mall. (W SHANER APPRAISALS,INC. Blight Analysis • 24 Capital Mall Blight Study An article was reviewed that addresses this matter specifically. It was written by John Simpson, MAI who has authored all or parts of four Appraisal Institute books and 11 Appraisal Journal articles, and he has over 20 years of commercial appraisal experience. In his online appraisal blog "Appraisal Matters", he wrote about older regional malls. In it, he stated that these properties "face a quandary." He goes on to note "they need to be renovated to keep competitive with newer regional malls, yet this is a very expensive proposition that rarely is financially feasible." Additionally, the article states "Older regional malls that have not been modernized to current levels have great difficulties attracting the high credit anchors they want." Mr. Simpson states "typically renovations that have occurred over the prior five to ten years are cosmetic and do little to increase foot traffic." Mr. Simpson finishes his article with the following conclusion: So older regional malls have lower sales per square foot and higher common area maintenance costs. Frequently traffic volume and traffic patterns reduce the radius it can draw from. So even if the mall is renovated, it is extremely difficult to recoup the cost, hence what we see are partial renovations that focus on cosmetics. The problem is that prospective retail tenants recognize the dynamics and even with a face lift, they are very hesitant to commit. Their response is "show me higher average sales volumes",which is a Catch 22 with only cosmetic renovations. Even if sales volumes increase,the higher costs associated with the mall result in a lower negotiated rent. So again, mall owners are faced with a difficulty in justifying the costs of a full renovation. That's why they need one or more new anchors, yet the particular location matrix of an anchor will generally preclude a regional mall perceived as a "locals" mall. Based on our inspection of the subject property along with the data that has been obtained from the article noted above, it appears that the age of the subject property contributes to the indication of blight for the Study Area. SHAN€R APPRAISALS,INC. Blight Analysis • 25 Capital Mall Blight Study ` I or Ir 1 SHANER APPRAISALS,INC. Blight Analysis • 26 Capital Mall Blight study J �€A' SHANER APPRAISALS,INC. Blight Analysis 27 Capital Mall Blight Study Chapter 353 Factor# 3—Inadequate or Outmoded Design The majority of the Study Area is improved with a regional shopping center. In general, current views are that the designs of regional shopping centers are considered both inadequate and outmoded. The layout of an older mall property like the subject is considered a problem to some investors as the buildings have long wings that connect to the various anchors. This is a concern because each wing in a shopping center typically requires an HVAC system which can help to eliminate economies of scale, increase repair and replacement costs, and reduce the energy efficiency of the facility. A layout of the subject's facility that shows the various wings at the subject shopping center can be seen later in this section. As shown by the pictures on page 31, the entrance wings have little to no physical or visual activity rendering the design to be out-of-style and inadequate by today's standards. The main entrance to the subject site from Truman Boulevard enters with a view of the service and loading area of the Sears tenant and not to one of the main entrances to the shopping center, which can be found primarily on the south side of the subject building near the food court. By today's standards service areas are shielded from public view. The two entrances nearest to Truman Boulevard are, for the most part, void of any significant leasable space rendering the design to be inadequate and outmoded. CoStar published a three part series in October 2012 titled "The De-Malling of America: What's Text for Hundreds of Outmoded Malls?" In this article, it notes that REITs like Simon Property Group and General Growth Properties (the prior owner of the subject property), which are the nation's largest mall operators, are divesting lesser-performing properties. Investors have been purchasing these properties at these low prices and believe that they can reposition these malls or raze them to gain land for apartments or other uses. The article goes on to note that that the issues that face distressed malls and large shopping centers ranges from changing neighborhoods, increased competition from online retailers, the appeal of newer lifestyle and power centers, consolidation of anchor stores, and sharp downsizing by in-line tenants. In a report from Green Street Advisors, it was forecast that 10% of the nation's 1,000 enclosed malls will fail by 2022 and will eventually be converted to uses other than retail. Chapter 353 Factor#4—Physical Deterioration We have been provided a report completed by Jamie Reed, General Manager for the subject property. This report shows that there are a number of items of physical deterioration and potential safety issues within the subject property. The description of these items from this report are included below with the full report being included in the addendum of this report. SHANER APPRAISALS,INC. Blight Analysis 9 28 Capital Mall Blight Study 1. Facades -The facade of the mall property is its poor condition in several plates. Sec enclosed picture 1 for an example of typical facade conditions. 2. Roof—The roof is in poor condition in several places. There arc a substantial number of active roof leaks and signs of a history of roof leaks in 14 of 30 of the tenant areas observed_ In addition,substantial repairs will be needed to the roof parapet. See enclosed pictures 2 to 11 for evidence of the roof condition and leaks found. 3. HVAC—The HVAC system is in poor condition. It has born rccommendW that 11 HVAC units he replaced in the short term due to their substantial deterioration, age and obsolescence. 4. Steel Senice Doors—Cine-half of the steel service doors are rusted and deteriorated along the door jambs. See enclosed picture 12 for an illustration of the typical rusted steel door S. Painted Fittisho—Sevual tenant entries arc in need of immediate painting. 6. EIFS—Damage was observed to the underlying EIFS (facade) at scveml of the tenant entries, most notably at vacant spaces at the suuthem end of the building. See enclosed pictures 13 to 16. See also picture 17 for typical dried and cracked control joint sealant found on the throughout the facade. 7. Suspect Mold -Visual signs of suspect mold have been identified two tenant areas. See enclosed picture 8 and 11. 'this is a safety aril health issue, in addition to a deterioration Issue. 8. pavement As you already noted the parking lot payment is highly deteriorated and in need of replacement. See enclosed pictures 18, 19 and 20 for recently taken of the parking pavement ccinditions. 9. Curbs—The curbs are deteriorating in several places throughout the property. See enclosed picture 21 of a damaged curb on the property that was typically observed. 10. Trip Hazard At west side of JC Penney a trip hazard was idcatificd. See enclosed picture 22. 11.Service Entry Lights—There are several damaged at lights over service entry doors. :See enclosed picture 23 for typical missing lights over ser%ice entry dcmrs. This is a safety issue as much as a deterioration issue. 12.Windows_ -Replacement needed at small anchor tenant at south end of building. See enclosed picture 24. In addition to these items, the reader is referred to the discussion of physical deterioration on page 33 under"Deterioration of Site Improvements." Chapter 99 Factor# 1–Defective and Inadequate Street layout Conditions associated with defective or inadequate street layout include poor vehicular access and/or internal circulation; substandard driveway definition and parking layout (e.g. lack of curb cuts, awkward entrance and exit points); offset or irregular intersections; and substandard or nonexistent pedestrian circulation and lack of signage. The lack of signage can create uncertainty and a potential for accidents for drivers who are unfamiliar with the area. SHAKER APPRAISALS,INC. Blight Analysis • 29 Y Capital Mall Blight Study One of the conditions that was common throughout the Study Area was that of non-existent pedestrian circulation. The only sidewalks found within the Study Area were located around the perimeter of the buildings, and no sidewalks linked the redevelopment area with adjoining areas. done of the streets in the Study Area have sidewalks. Additionally, there are no sidewalks along West Truman Road or along Country Club Drive. The lack of sidewalks creates a dangerous environment for pedestrians within the Study Area. Creating pedestrian linkages with major activity hubs such as the Capital Mall is often a planning priority of most communities. Chapter 99 Factor#2— Unsanitary or Unsafe Conditions There are widespread locations within the Study Area exhibiting unsafe or unsanitary conditions. The most prevalent Study Area conditions considered unsafe or insanitary include numerous potholes throughout the parking areas, poor drainage throughout the parking areas, the existence of cracked or uneven sidewalks, poor drainage, life safety issues and outdated building systems. The numerous potholes throughout the area lead to unsafe conditions to vehicular traffic and especially to pedestrian access to and from the parking areas. Chapter 99 Factor# 3—improper Subdivision or Obsolete Platting There are specific conditions that can be used to determine the existence of improper subdivision or obsolete platting. Among these conditions are irregular or faulty lot shape and/or layout, inadequate lot size, poor access, as well as conformity of use. Field study and review of public records suggest these conditions present throughout and are predominate within the Study Area. Lot layout is deemed to be faulty if the configuration relative to the street is contrary to what is desired for development. Lot shape is considered faulty if the shape is unusual to an extent that it deters or constrains development options. The Study Area consists of 14 parcels that are irregularly configured, making it difficult to undertake a coordinated approach to redevelopment of the property so as to bring it up to modern development standards. Each of the department stores together with its ancillary parking has been separately platted, resulting in the plats having highly irregular shapes. Such platting results in the creation of a number of legal and financial obstacles to development. The GIS map on page 7 of this Report illustrates improper subdivision or obsolete platting in the Study Area. Of the 3,409,423 square feet contained in the Study Area, 100% of the property in the Study Area reflects this condition. The Study Area predominantly suffers from improper subdivision and obsolete platting. There are several additional evidentiary factors that support this. The first is that the main entrance to the subject site from Truman Boulevard enters with a view of the service and loading area of the Sears tenant and not to one of the main entrances to the shopping center, which can be found primarily on the south side of the subject building near the food court. The two entrances nearest to Truman Boulevard are, for the most part, void of any significant leasable space. A photo of the two entrance wings is below. In addition, although it is not owned by the same entity as the mall, Dillard"s has poor visibility and access from both Country Club Drive and Truman Boulevard. This can be seen on the site plan that follows in this section. SHANER APPRAISALS,INC. Blight Analysis • 30 Capital Mall Blight Study e 4 . A second factor that evidences improper subdivision of the overall Study Area is that the shopping center and subject land is not built out 100%, even though the center was constructed nearly 35 years ago. IL There is one pad site (Parcel 4)that is 1.51 acres and has frontage along Country Club Drive. This pad site SHANER APPRAISALS,INC. Blight Analysis • 31 a Capital Mall Blight Study remains vacant. There are also three parcels (Parcels 2, 6 and 11) that are considered "buffers" from the residential development that exists to the east. Although this buffer is required by zoning, it consists of slightly over 20% of the total site area in the Study Area, which is considered to be excessive. Within the Study Area, the platting is also considered to be inefficient and obsolete by today's standards as JC Penney and Dillard's have been separately platted. The division of space has resulted in the plats having very irregular shapes. These anchors (JC Penney and Dillard's) are owned by a different entity than the remainder of the shopping center. This presents major problems relating to the development of a plan for any redevelopment or adaptive reuse of the property as well as legal and financial hurdles to development. The shopping center and site plans that were referenced earlier in this section can be seen below and on the following page. Page 7 of this report shows the layout of the various parcels and their irregular shape and location on the site. JCPENNEY ?5.112 Sr .... ;: it 't 0 Entrances ---- closest to ;�* Truman Blvd. i :� i�� i�1 ii i� 'sib � • Ali ' � � f � V1NMA • fa ��" y_ !h• w YI • ?'rr - 'QY - -N _ .rte. J D LJ at is iJ •illi �t ,.:t. �,� t ,. � ,,' '� _ :. �• i rwwr SHAKER APPRAISALS,INC. Blight Analysis 32 Capital Mail Blight Study 41. indevelo ed Dillard Land acantPad Site All of these components indicate that the subject property suffers from an inadequate and outmoded design as well as improper subdivision and obsolete platting, and these are considered to be an indication of blight. The fact that one pad site remains vacant evidences the limited demand inthe area and results in an economic liability 0uthe city. In addidon, the parcels that are currently used aubuffers between the shopping center and the residential development to the east are useful for their current purpose, but in this capacity do not generate significant taxes for the city. Chapter 99 Faotmr#4—Deterioration of Site Improvements N At the Study Area,there are a number of items of physical deterioration that are present, however, it does � not appear that any of these items are significant. They include damaged parking areas and damaged interior tiles. On the interior of the mail, the building itself is dated with several places in the building that have floor tiles that are mismatched as well as some evidence o/damaged floor tiles. There was nothing specific that was identified as major deterioration, such as evidence of foundation damage, HVA[ N nbso|escenco, roof leaks, or improper drainage around the mall's exterior, however as noted previously, there was an overall dated appearance to the facility. One issue with the Study Area is the interior of the shopping center and the damaged floor tile. It does not appear that there is any remaining matching tile for the majority of the building. As noted previously, areas of the common floor have been replaced with lighter color tiles. Because of this, it is possible that the cost to update the flooring throughout the building's common areas would beadetriment todevelopers from acost-benefit standpoint. �w� SwxmsnAPPRAISALS,INC. Blight Analysis * 33 Capital Mall Blight Study My inspection also found that the parking lot was nearing the end of its useful life and is in need of resealing and restriping, and repair of potholes. Several curbs are deteriorating and need repairs throughout the area as well. The following pictures show a sample of the damaged tile as well as the damage in the parking area. SHANER APPRAISALS,INC. Blight Analysis • 34 '.- r. - ar�Q'�. `if'"�d^'�`r�.Y�i..�> �_������,+✓ fii�'�"•i' ,�. c ++, ;�' .y, ♦• `tel,. t :_+,r i _1 'J.� J+ "Y ti � ... Capital Mall Blight Study y � t SHAKER APPRAISALS,INC. Blight Analysis • 36 Capital Niall Blight Study Therefore, given the reasons outlined above, physical deterioration is considered to be an indication of blight. Chapter 99 Factor# 5—Conditions which Endanger Life or Property by Fired and Other Causes According to the property condition report received from Jamie Reed, the fire sprinkler system has not been tested since October 2009. These systems are supposed to be tested on an annual basis. Because of the lack of fire system testing stated in the property condition report, there is an potential that the fire system may not operate correctly in the event of a fire. This can be considered a condition that would endanger life and property by fire. BLIGHT STUDY CONCLUSIONS The following factors of the blight definition are present in the proposed Study Area. Chapter 353 Blight Factors Yes No Age X Obsolescence X Inadequate or Outmoded Design X Physical Deterioration X The foregoing analysis demonstrates that four out of the four Chapter 353 blighting factors are present throughout the Study Area. In accordance with Missouri's Urban Redevelopment Corporations Law definition of Blight Section 353.020(2). RSMo., the Study Area is blighted if the governing body of the city determines that by reason of age, obsolescence, inadequate or outmoded design or physical deterioration the area have become economic and social liabilities, and that such conditions are conducive to ill health,transmission of disease, crime or inability to pay reasonable taxes. Because of the four present blighting factors above, the Study Area has become both an economic and social liability and these conditions are conducive to the inability to pay reasonable taxes as defined in Section 353.020(2), RSMo. See below for a full evaluation of economic liability, social liability and the inability to pay reasonable taxes. Chapter 99 Blight Factors Yes No Defective or Inadequate Street Layout X Unsanitary or Unsafe Conditions X Improper Subdivision or Obsolete Platting X Deterioration of Site Improvements X Conditions which Endanger Life or Property by Fire and Other Causes X The foregoing analysis demonstrates that five out of the five Chapter 99 blighting factors are present in the Study Area and the combination of these conditions are predominant in the Study Area. Under the Missouri Real Property Tax Increment Allocation Redevelopment Act, Section 99.$05(1), RSMo. the Study Area is a blighted area if by reason of the predominance of defective or inadequate street layout, unsanitary or unsafe conditions, deterioration of site improvements, improper subdivision or obsolete platting, or the existence of conditions which endanger life or property by fire and other causes, or any combination of such factors, retards the provision of housing accommodations or constitutes an SHANER APPRAISALS,INC. Blight Study Conclusions • 37 Capital Mall Blight Study economic or social liability or a menace to the public health, safety, morals, or welfare in its present condition and use. By reason of the predominance of the five present blighting factors above, the Study Area, in its present condition and use, constitutes both an economic as defined in Section 99.805(1), RSMo. See below for a full evaluation of both economic liability and social liability. Inability to Pay Reasonable Taxes A specific definition that clearly defines "the inability to pay reasonable taxes" was not found in the Missouri Statues. In the real estate field, the inability to pay reasonable taxes can simply be that that property value as it currently sits is less that the potential value of the property as renovated or rehabbed. There is substantial evidence that the property is unable to pay reasonable taxes which result directly from the age, obsolescence, inadequate and outmoded design and physical deterioration of the property. The subject property was recently purchased in December 2012 for a sales price of $11,000,000. In the course of that purchase, an appraisal was completed by Cushman and Wakefield. The appraisers that signed this report were Thomas S. Helm, MAI, MRICS, who is a Senior Director and Richard Latella, MAI, FRICS, who is the Executive Managing Director and Americas Practice Leader for the company. The value conclusions from this report can be seen in the chart below. �Value Conclusions Appy"f _ Red Propuiy Interest Dfe of Value _ Colw*slort Market a ue As-V_ eas ee -- 12/5/2012 $1 1.1301M Prospective Market Value Upon Stabilization Leased Fee 1/112016 $12.900.000 (W COMailed o)Csasnrran&wj*eriev or uumo+c oc. In this report, it was noted that the "as is" value of the property, which accounts for the tenants that were in place as of their inspection date of December 5, 2012, was $11,200,000. They also provided an "as stabilized" value as of January 1, 2015 of $12,900,000. The value differences between the "as is" and "as stabilized" values is due to the fact that the appraisers felt that the subject was not at a stabilized occupancy. It was estimated that approximately 10,842 square feet would require lease-up to long term tenants, and that 12,229 square feet would be occupied by temporary tenants. This would bring the subject's occupancy up to a typical market level for a regional shopping mall. Because the subject property is not considered to be currently stabilized, its fair market value, which is what the assessors in Missouri base their values, is below that of a stabilized shopping center. Given this fact, the subject property is not paying reasonable taxes. We have also been provided the historical operating statements from the property owner for 2009, 2010, 2011,their 2012 budget, and where they are as of January 1, 2013. This can be seen below. SHAKER APPRAISALS,INC. Blight Study Conclusions • 38 Capital Mall Blight Study to, INCOME 1/1/2013 Contractual Minimum Rents $2,576,309 52,230,042 $2,154,764 $2,135,350 $1,756,616 Lease Termination Income 550,000 SO $27,110 $0 50 Reimbursement Income $1,072,185 $870,690 $769,591 5697,779 $432,050 Marketing/Promotion $55,091 525,714 $13,433 $14,396 $0 Other Tenant Reimbursement $15,173 512,098 $9,812 $3,571 $392,456 Overage Rent 5145,812 5177,037 $190,432 $195,613 $449,948 Other income $97,741 $48,375 $70,206 $69,377 $69,377 TOTAL INCOME $4,012,311 53,363,956 $3,235,348 $3,116,086 53,100,447 EXPENSES Marketing $55,091 $49,782 546,558 $55,968 S55,450 Operations $257,965 5247,988 $186,739 5212,154 5205,400 utilities $343,469 5401,232 $449,375 $506,722 $501,500 Ciedning $241,322 $268,791 $311,351 5286,908 $285,650 Landscaping 517,791 $17,352 512,285 $11,900 $11,900 Security $159,629 $160,362 $164,712 $164,103 5163,900 Other $187,290 5176,179 $180,672 $166,292 $168,880 Management Fee $58,828 $68,949 $0 $0 5o Real Estate Taxes $288,603 $284,212 $203,225 5195,055 5182,715 Insurance 547,508 538,454 26 514 S27,660 $27,660 TOTAL EXPENSES $1,657,496 $1,713,301 $1,581,431 51,626,762 51,603,055 NET OPERATING INCOME $2,354,815 51,650,655 51,653,917 $1,489,324 51,497,392 IL As can be seen in this chart, the net operating income for the subject property dropped nearly 30% between 2009 and 2011, which is the last year that actual numbers were provided. If the in place estimate of net operating income as of January 1, 2013 were considered, the net operating income would have declined by over 35% from 2009. Through the three years of actual income and expenses that we have, the expenses at the subject property have remained fairly stable. The total income of the property has declined from $4,012,311 in 2009 to the current in place total income of $3,100,447, a decline of nearly $900,000. Based on the historical figures, this appears to be due to the decline in the contract minimum rents. Regional shopping centers like the subject are almost always purchased for their income generating potential. If the net income that would be available to the property owner has declined by approximately 35%, that would have an effect on the market value of the subject property. Given that the county assessor is to value the subject property for taxation purposes at its fair market value, assuming the mill levy remained constant, it is logical to assume that the taxes that would be paid on the property would decrease,which would support the blighting factor of inability to pay reasonable taxes. In addition to the information above, the 14 parcels that make up the Study Area are currently assessed and taxed as various county parcels. A summary of the parcels involved and their current tax amounts follows. SHANER APPRAISALS,INC. Blight Study Conclusions • 39 Capital Mall Blight Study Taxes per Parcel Parcel 2008 2009 2010 2011 2012 1 $284,188.32 $274,156.42 $269,985.04 $169,647.15 $169,508.72 2 $2,318,32 $2,236.48 $2,202.45 $2,202.65 $2,000.85 3 $18,013.68 $17,377.80 $17,113.39 $17,114.93 $17,100.96 4 $8,551.76 $8,249.89 $8,124.36 $6,965.32 $6,959.63 5 $7,665.43 $7,394.84 $7,282.32 $7,997.72 $7,991.19 6 $18.58 $17.93 $17.66 $17.65 $17.64 7 $4,112.49 $3,967.33 $3,906.96 $3,907.32 $3,904.13 8 $174,800.20 $168,629.71 $166,063.96 $113,598.12 $113,505,42 9 $8,828.65 $9,101.03 $8,962.56 $10,173.89 $10,165.58 10 $21,470.27 $20,712.36 $20,397.21 $20,399.06 $20,382.42 11 $4,086.37 $3,942.12 $3,882.13 $3,882.49 $3,879.32 12 $53,865.76 $51,964,28 $51,173.64 $49,785.78 $49,745.15 13 $15,385.42 $14,842.31 $14,616.48 $11,394.89 $11,385.59 14 $63,617.32 $61,371.62 $60,437.84 $49,094.20 $49,054.14 Total $666,922.57 $643,964.12 $634,166.00 $466,181.17 $46S,600.74 Tax Table County County Current Taxes Parcel Assessment Appraised Assessed (2012)Current Taxes 2408 Taxes % of 2008 Rate /o Value Value Tax Amount 1 32% $9,613,000 $3,076,160 $169,508.72 $284,188.32 59.65% IL 2 32% $124,800 $39,940 $2,200.85 $2,318.32 94.93% 3 32% $969,800 $310,340 $17,100.96 $18,013.68 94.93% 4 32% $394,700 $126,300 $6,959.63 $8,551.76 81.38% 5 32% $453,200 $145,020 $7,991.19 $7,665.43 104.25% 6 32% $1,000 $320 $17.64 $18.58 94.94% 7 32% $221,400 $70,850 $3,90413 $4,112.49 94.93% 8 32% $6,437,000 $2,059,840 $113,505.42 $174,800.20 64.93% 9 32% $576,500 $184,480 $10,165.58 $8,828.65 115.14%a 10 32%v $1,155,900 $369,890 $20,382.42 $21,470.27 94.93% 11 32% $220,000 $70,400 $3,879.32 $4,086.37 94.93% 12 32% $902,750 $288,880 $49,745.15 $53,865.76 92.35% 13 32% $206,620 $66,118 $11,385.59 $15,385.42 74.00% 14 32% $890,210 $284,867 $49,054.14 $63,617.32 77.11% Totals $22,166,880 $7,093,405 $465,800.74 $666,922.57 69.84% The subject property has been operated for a number of years and has been generating taxes. However, the taxes generated by the county have been falling as the property ages, income drops, and vacancies increase. The appraised value by the county for the properties within the Study Area is $22,166,880 and results in taxes of$465,800.74 for the 2012 tax year. We have researched the historical tax amounts of the properties within the Study Area. In general, the records available go back five years. The total taxes generated by the parcels in the Study Area in 2008 was $666,922.57. This compares to a total tax generated in 2012 for those parcels of $465,800.74. This M SHANER APPRAISALS,INC. Blight Study Conclusions • 40 Capital Mall Blight Study suggests that the real estate taxes generated by the properties is now only roughly 69.84% of that generated in 2008. This has resulted in a significant loss in property taxes for Jefferson City. The tax revenues generated at the subject are lower than they were in 2008 as a result of the decline in the subject mall's revenues, along with the decline in mall properties around the country referenced earlier in this report. The continued deterioration of the subject property both physically with the near term deferred maintenance and economically with the potential continued decline in revenues will continue to see the taxes generated from this property decrease. One common way to view the potential future for a shopping center is to look at the mall sales per square foot. Gerard V. Mason, executive managing director of Savills US, stated that high quality malls should take in $400 per square foot, while decent 8-class malls should yield about $350 a square foot. Anytime that a mall's sales fall below$300 per square foot, it is likely in very serious trouble. According to the historical sales data that has been provided,the total tenant sales per square foot are $161.88. A healthy mall anchor store should have at least $200 per square foot and any retailer that is below $100 per square foot is probably in danger of closing. Based on the information that we have been provided, several retailers fit this test and add to a fear of closing. Another critical factor is a store's health ratio, which is also known as occupancy cost, and is calculated by dividing the annual rent by total sales for the year. Healthy mall store ratios average about 11% to 12%. Any ratio above 15% will likely land a store on a watch list and if it is above 20% the store is probably destined to go dark. Based on the marketing packet, there were ten retailers that had health ratios that were above 13%. These are shown below: Health Ratios of Inllne Stores (W Wilson's Total Fitness 20.61% Claire's 15.40% CJ Banks 14.77% Modern Nails 48.22% Stir Fry 33.15% Christopher and Banks 28.71% DEB 13.10% Hallmark 13.29% Pretzelmaker 33.89% Mastercuts 16.81% Given the low sales per square foot and the large number of tenants that have a health ratio above 13%, there is a possibility that there may be store closings in the subject center if the sales throughout the mall do not increase. Renovation of the property would likely result in a higher value due to an increase in traffic and renewed interest by retailers to locate in the mall, and would therefore generate a higher tax base. Renovation of the property would also result in increased employment, personal property, utility, and sales taxes. In my opinion, the blighted elements noted previously have resulted in the inability of the affected properties to pay their reasonable share of taxes. Economic Liability The city and other taxing districts are highly dependent on real property taxes, personal property taxes, utility taxes and sales taxes generated in its commercial areas. As discussed in detail above the Study SHANER APPRAISALS,INC. Blight Study Conclusions • 41 Capital Mall Blight Study Area in generating substantially less in real property taxes in the last several years and its real property tax generation continues to decline. The real property tax generation of the Study Area has decreased to 69.84% of the total that was seen in 2008. Without redevelopment it is expected that the real property tax generation will continue to decline. Although there is no detailed study of sales tax revenues for the Study Area rent revenues which are tied directly to sales in retail centers has substantially declined leading to the inevitable conclusion that sales tax revenues from the Study Area have also substantially declined and the evidence leads to the conclusion that these revenues will continue to decline without redevelopment. Clearly the Study Area is not generating the amount of tax revenues to its potential and thus results in an economic liability. The decline of the tax revenues is a result of reason of age, obsolescence, inadequate and outmoded design and physical deterioration of the Study Area and thus by reason of these factors the Study Area is an economic liability. The decline of the tax revenues is also results from the predominance of the combination of defective and inadequate street layout, unsafe conditions, deterioration of site improvements, improper subdivision and obsolete platting, and thus by reason of these factors the Study Area in an economic liability in its present condition and use. The Study Area consists of an underutilized property and has not been subject to acceptable growth and development through private enterprise. The existence of the blighting factors present inadequate or outmoded design and physical deterioration, when taken as a whole, clearly indicates that the Study Area constitutes an economic liability in its present condition and use_ Because of this and the other blighting factors, it is unlikely that the Study Area will be redeveloped without assistance. This concept of an economic liability or the economic underutilization of a property as a basis for blight has been upheld by the Missouri Supreme Court. The Court has determined that "the concept of urban redevelopment has gone far beyond 'slum clearance' and the concept of economic underutilization is a valid one." Blight exists to the extent an area is operating less than its potential. The community is harmed by the foregone tangible and intangible benefits resulting from underperformance.The following are reference to the Missouri Supreme Court Cases- Parking Systems, Inc. v. Kansas City Downtown Redevelopment Corporation, 518 S.W.2d 11, 15 (Mo.1974). The courts determined that it is not necessary for an area to be what commonly would be considered a "slum"in order to be blighted. • Crestwood Commons Redevelopment Corporation v. 66 Drive-in, Inc., 812 S.W. 2d 903, 910 (MO. App. E.D.1991). The courts determined that on otherwise viable use of a property may be considered blighted if it is an economic underutilization of the property. • State ex. Rel Atkinson v. Planned Industrial Expansion Authority, 517 S.W.2d 36 at 46 (Mo. banc 1975). The courts determined that blight may also be found if the redevelopment of an area "could promote a higher level of economic activity, increased employment, and greater services to the public." SHANER APPRAISALS,INC. Blight Study Conclusions • 42 Capital Man Blight Study Social Liability To our knowledge the term social liability has not been defined in Missouri's statutes or in Missouri cases. The following is the ordinary meaning of the term "social"as found in the dictionary: • "Of, relating to, or concerned with the welfare of human beings as members of society" and "of or relating to the interaction of the individual and the group." Liability is defined as: • "Something that works as a disadvantage." Based an the two definitions, "social liability" can be anything that works to the disadvantage of the welfare of members of a given community or of interaction among such members. The welfare of the community is substantially based on job opportunities and adequate amenities such as shopping and community services provided by various taxing jurisdictions from its tax revenue sources. As vacancies increase and sales decrease the Study Area is less able to provide job opportunities for members of the community as would be expected from commercial areas of this nature. Likewise, a reduction in tax revenues reduces the ability of taxing districts to provide educational and other community services to its community members. Taken together these factors lead to the conclusion that the Study Area by reason of the blighting factors constitutes a social liability in its present condition and use. As discussed in this report, the Study Area is affected by age and obsolescence, inadequate or outmoded design, and improper subdivision and platting, among the several other blighting factors reviewed in this Report. Age and obsolescence can be seen with the overall dated appearance of the subject property. Based on data presented earlier, a regional shopping center is typical considered to be an outmoded design. The majority of shopping centers that have been built recently have been open-air centers. This benefits the landlord because people enjoy these shopping districts and it also lowers the utility and repair cost as there is no common area to heat and cool. Based on the data and information contained in this report, I have determined that as of December 9, 2012, the Study Area constitutes both a "social liability" and an "economic liability" and meets the definition of a '"blighted area" according to the definition provided in Missouri's Urban Redevelopment Corporations Law (Section 353.020 (2) R.S. Mo.) as well as Section 99. 605(1) of the Real Property Tax Increment Redevelopment Act. Further 1 have determined from my examination of each individual parcel of the Study Area that more than 50% of the Study Area is a blighted area pursuant to Sections 353.020(2) and 99.$05(1), RSMo and consequently, a preponderance of the Study Area, as a whole is a blighted area under Sections 353.020(2)and 99.805(1), RSMo. SHAKER APPRAISALS,INC. Blight Study Conclusions 9 43 ADDENDA. • Appraiser(qualifications • Area Demographics • Glossary • Additional Information SHANER APPRAISALS, INC. APPRAISER QUALIFICATIONS SHANER APPRAISALS, INC. Qualifications of Jason Roos, MAI Director - Industrial Valuation Valbridge Property Advisors I Shaner Appraisals,Inc. .r Independent Valuations for a Variable World State Certifications Membership/Affiliations: Member: Appraisal Institute- MAI Designation State of Kansas Treasurer Appraisal Institute—Kansas City Chapter State of Missouri State of Iowa Appraisal Institute & Related Courses: State of Nebraska Business Practices & Ethics State of North Dakota Uniform Standards of Appraisal Practice Advanced Income Capitalization Education Advanced Sales Comparison &Cost Approaches Report Writing and Valuation Analysis BBA University of Advanced Applications North Dakota A Debate on the Allocation of Hotel Total Assets Fundamentals of Separating Real Property, Personal Property, and Contact Details Intangible Business Assets Appraising the Appraisal:Appraisal Review—General 913-451-1451 (o) Analyzing Tenant Credit Risk and Commercial Lease Analysis 913-647-4095 (d) Condemnation Appraising: Principles and Applications Valbridge Property Advisors Experience: Shaner Appraisals,Inc. Director—Industrial Valuation 10990 Quivira Road Valbridge Property Advisors I Shaner Appraisals,Inc. (2007-Present) Suite 100 Overland Park, KS 66210 Appraisal/valuation and consulting assignments include: industrial buildings, office buildings, retail buildings, and hotels and motels. www.valbridye,com Industrial properties appraised include a wide variety of warehouse iroos@valbridge.com and manufacturing facilities located across the Midwest. Assignments have been concentrated in the Kansas City Metropolitan area, but assignments have been completed across the country on specialized manufacturing and warehouse properties. COMPANY PROFILE SHANER APPRAISALS, INC. 10990 Quivira, Suite 100 Overland Park, Kansas 66210 Phone (913) 451-1451 1 Fax (913) 529-4121 www.shanerappraisals.com Shaner Appraisals, Inc. is a full-service real estate valuation and consulting firm located in Overland Park, Kansas. Founded in 1978, Shaner Appraisals has established a solid reputation for professional real estate services. The firm employs eighteen full-time appraisers, including five MAI and one SRA designated member of the Appraisal Institute. Our professionals represent over 100 years of valuation and related experience, and three past presidents of the Kansas City Chapter of the Appraisal institute. The firm's primary market is Kansas and Missouri, but Shaner Appraisals has also completed assignments throughout the United States. The firm provides Market Studies, Feasibility Analyses, Litigation Support and Valuation Services for all types of property from multi-family residences to shopping centers, office buildings and industrial complexes. Shaner Appraisals also has extensive experience in eminent domain matters and in valuing special purpose properties such as nursing homes, underground storage facilities, microwave towers, and rock quarries. All assignments are completed or reviewed by an MAI designated appraiser. LIST OF SERVICES VALUATION/COUNSELING PURPOSES Commercial property appraisals Financing Residential property appraisals Ad valorem tax disputes Eminent domain appraisals Trusts and estates Expert witness testimony Condemnation Property tax appeals Investment analysis Market studies Arbitration Feasibility studies Portfolio valuation Litigation support Collateral assessment Due diligence research Right of way acquisition Appraisal review Financial structuring Partial interest valuation Blight studies Conservation easement valuation General real estate counseling Rent studies PROPERTY TYPES APPRAISED Office buildings—single/multi-tenant,standard office, medical office,surgery centers Retail centers—singlelmulti-tenant, neighborhood,community, regional shopping centers Industrial buildings—flex, R&D,distribution, manufacturing, underground,self-storage Land—All types Multi-family apartment complexes, LIHTC, HUD Nursing homes Hotels, motels, extended stay facilities Single family homes, condominiums, duplexes Churches Easement corridors PARTIAL CLIENT LIST Government Agencies/Municipalities Unified Government of Wyandotte County/ Kansas City, DeSoto School District Kansas Blue Valley School District City of Gardner Gardner School District City of Overland Park Shawnee Mission School District City of Leawood Johnson County Airport Commission City of Lee's Summit Johnson County Appraiser's Office City of Lenexa Johnson County Board of County Commissioners City of Independence Johnson County Parks and Recreation Dept. City of Olathe Johnson County Wastewater District City of Shawnee Kansas Department of Transportation City of Wichita Kansas Highway Patrol City of St.Joseph U.S. Department of Justice Dept.of Housing& Urban Development(HUD) U.S. Postal Service Eudora School District GSA Olathe School District Lending Institutions Bank One Commerce Bank Bank Midwest, N.A. Country Club Bank Bank of America Credit Suisse First Boston Bank of Blue Valley EF&A Funding Blue Ridge Bank &Trust First Federal Bank Berkshire Mortgage Financial First Kansas Bank Bridger Commercial Funding First Mortgage Investment Corporation Capitol Federal Savings First National Bank of Olathe Central Bank of Kansas GMAC Commercial Mortgage Grandbridge Real Estate Capital M&I Bank Great Southern Bank Quantum First Capital Heartland Bank Red Mortgage Capital, Inc. Hillcrest Bank Security Bank of Kansas Intrust Bank. Southern Pacific Bank Key Bank Commercial Mortgage Southwest Bank LaSalle Bank Triad Mortgage& Realty Metcalf Bank UMB Bank Midland Loan Services Union Bank Missouri Bank&Trust United Missouri Bank MuniMae Midland,LLC US Bank Newman Financial Services Valley View State Bank North American Savings Bank Washington Mortgage Northmarq Capital, Inc. Wells Fargo Peoples Bank Thelman Financial I Corporations, Developers and Institutional Clients Allianz Life Insurance Company American States Insurance Allstate Insurance Property Tax Research Company St.Luke's Health System Protective Life Insurance Company Boy Scouts of America Salvation Army Burlington Northern Savage& Browning CALPERS Sentinel Real Estate Company Cessna Aircraft Company Shawnee Mission Medical Center Colliers Turley Martin Tucker Shelter Insurance Copaken,White&Blitt Jeffrey Smith Company Excel Corporation State Farm Fire and Casualty Insurance FMC Corporation Stern Brothers GE Capital Stephens&Company,Inc. General Services Administrations Terra Venture, Inc. Grubb&Ellis TRI Capital Hallmark Cards Wal-Mart Stores,Inc. Hunt Midwest Washington Capital J.A. Peterson Company Wei ngart Foundation Principal Life Insurance Company Yarco Companies Principal Mutual Life YWCA Zimmer Real Estate Services Accounting and Law Firms Armstrong Teasdale Schlafly& Davis Norton, Hubbard,Ruzicka&Kreamer Husch, Blackwell,Sanders Payne&Jones Craft,Fridkin&Rhyne Orrick&Associates Deloitte&Touche Polsinelli Shugart PC Ferree, Bunn,O'Grady& Runberg Pricewaterhouse Coopers Sonnenschein,Nath&Rosenthal, LLP Shook Hardy&Bacon Lathrop&Gage Spencer Fane Britt& Browne McAnany VanCleave&Phillips,P.A. Stinson Morrison Hecker MHM Property Tax Consultants Wallace,Saunders,Austin, Brown &Enochs Mitchell, Kristl & Lieber Ernst&Young Schlagel,Gordon&Kinzer LLC 0 AREA DEMOGRAPHICS N I V SHANER APPRAISALS, INC. Executive Summary Jefferson City Prepared by Laird GoldsboroughMA1 Jefferson City, M© (2937000) Geography: Place Jefferson City, MO (29370... Population 2000 Population 41,960 2010 Population 43,079 2012 Population 43,506 2017 Population 44,636 2000-2010 Annual Rate 0.26% 2010-2012 Annual Rate 0.44% 2012-2017 Annual Rate 0.51% 2012 Male Population 50.7% 2012 Female Population 49.3% 2012 Median Age 37.7 In the identified area,the current year population is 43,506. In 2010,the Census count in the area was 43,079. The rate of change since 2010 was 0.44%annually.The five-year projection for the population in the area is 44,636 representing a change of 0.51%annually from 2012 to 2017.Currently,the population is 50.7%male and 49.3%female. Median Age The median age in this area is 37.7, compared to U.S. median age of 37.3. Race and Ethnicity 2012 White Alone 78.6% 2012 Black Alone 16.2% 2012 American Indian/Alaska Native Alone 0.3% 2012 Asian Alone 1.7% 2012 Pacific Islander Alone 0.1% 2012 Other Race 0.9% 2012 Two or More Races 2.3% 2012 Hispanic Origin(Any Race) 2.9% Persons of Hispanic origin represent 2.9%of the population in the identified area compared to 16.9%of the U.S. population. Persons of Hispanic Origin may be of any race.The Diversity Index, which measures the probability that two people from the same area will be from different race/ethnic groups, is 39.3 in the identified area, compared to 61.4 for the U.S. as a whole. Households 2000 Households 16,403 2010 Households 17,278 2012 Total Households 17,432 2017 Total Households 18,001 2000-2010 Annual Rate 0.52% 2010-2012 Annual Rate 0.40% 2012-2017 Annual Rate 0.64% 2012 Average Household Size 2.25 The household count in this area has changed from 17,278 In 2010 to 17,432 in the current year, a change of 0.40%annually. The five-year projection of households Is 18,001,a change of 0.64%annually from the current year total. Average household size is currently 2.25, compared to 2.21 in the year 2010.The number of families in the current year is 10,100 in the specified area. Data Note:Income is expressed in current dollars Source:U.S,Census Bureau,Census 2010 Summary File 1.Esri forecasts for 2012 and 2017.Esri converted Census 2000 data into 2010 geography. January 29, 2013 Executive Summary Jefferson City Prepared by Laird GoldsboroughMAI Jefferson City, MO (2937000) Geography: Place Jefferson City, MO(29370... Median Household Income 2012 Median Household Income $46,525 2017 Median Household Income $55,537 2012-2017 Annual Rate 3.60% Average Household Income 2012 Average Household Income $58,464 2017 Average Household Income $64,945 2012-2017 Annual Rate 2.12% Per Capita Income 2012 Per Capita Income $25,845 2017 Per Capita Income $28,630 2012-2017 Annual Rate 2.07% Households bV Income Current median household income is$46,525 in the area, compared to$50,157 for all U.S, households. Median household income is projected to be$55,537 in five years, compared to$56,895 for all U.S. households Current average household income is$58,464 in this area, compared to$68,162 for all U.S households. Average household income is projected to be$64,945 in five years,compared to$77,137 for all U.S. households Current per capita income is$25,845 in the area, compared to the U.S. per capita income of$26,409. The per capita income is projected to be$28,630 in five years, compared to$29,882 for all U.S. households Housing 2000 Total Housing Units 17,580 2000 Owner Occupied Housing Units 9,895 2000 Owner Occupied Housing Units 6,509 2000 Vacant Housing Units 1,176 2010 Total Housing Units 18,852 2010 Owner Occupied Housing Units 10,085 2010 Renter Occupied Housing Units 7,193 2010 Vacant Housing Units 1,574 2012 Total Housing Units 18,951 2012 Owner Occupied Housing Units 10,196 2012 Renter Occupied Housing Units 7,237 2012 Vacant Housing Units 1,519 2017 Total Housing Units 19,394 2017 Owner Occupied Housing Units 10,610 2017 Renter Occupied Housing Units 7,390 2017 Vacant Housing Units 1,393 Currently, 53.8%of the 18,951 housing units in the area are owner occupied; 38.2%, renter occupied; and 8.0%are vacant. Currently, in the U.S., 56.5%of the housing units in the area are owner occupied; 32.1% are renter occupied; and 11.4%are vacant. In 2010,there were 18,852 housing units in the area - 53.5%owner occupied, 38.2%renter occupied, and 8.3%vacant. The annual rate of change in housing units since 2010 is 0.23%. Median home value in the area is$133,265,compared to a median home value of$167,749 for the U.S. In five years, median value is projected to change by 2.29%annually to$149,256. Data Note:Income is expressed in current dollars Source:U.S.Census Bureau,Census 2010 Summary File 1.Esri forecasts for 2012 and 2017.Esrl converted Census 2000 data into 2010 geography. January 29, 2013 GLOSSARY SHANER APPRALSALS, INC. GLOSSARY Unless otherwise noted, the following definitions are taken from The Dictionary of Real Estate Appraisal, Fourth Edition, published by the Appraisal Institute in 2002. Accrued Depreciation The difference between the reproduction or replacement cost of the improvements on the effective date of the appraisal and the market value of the improvements on the same date. (p.4) Appraisal (n.) The act or process of developing an opinion of value;an opinion of value. (adj.) Of or pertaining to appraising and related functions such as appraisal practice or appraisal services. (USPAP, 2002 ed.) (p. 15) Extraordinary Assumption An assumption, directly related to a specific assignment, which, if found to be false, could alter the appraiser's opinions or conclusions. Extraordinary assumptions presume as fact otherwise uncertain information about physical, legal, or economic characteristics of the subject property; or about conditions external to the property, such as market conditions or trends; or about the integrity of data used in an analysis. An extraordinary assumption may be used in an assignment only if; ■ It is required to properly develop credible opinions and conclusions; ■ The appraiser has a reasonable basis for the extraordinary assumption; ■ Use of the extraordinary assumption results in a credible analysis; and ■ The appraiser complies with the disclosure requirements set forth in USPAP for extraordinary assumptions. (USPAP, 2002 ed.) (p. 107) Fee Simple Estate Absolute ownership unencumbered by any other interest or estate, subject only to the limitations imposed by the governmental powers of taxation, eminent domain, police power,and escheat. (p. 113) Highest and Best Use The reasonably probable and legal use of vacant land or an improved property, which is physically possible, appropriately supported, financially feasible, and that results in the highest value. The four criteria the highest and best use must meet are legal permissibility, physical possibility, financial feasibility, and maximum profitability. (p. 135) Hypothetical Condition That which is contrary to what exists but is supposed for the purpose of analysis. Hypothetical conditions assume conditions contrary to known facts about physical, legal, or economic characteristics of the subject property; or about conditions external to the property, such as market conditions or trends; or about the integrity of data used in an analysis. A hypothetical condition may be used in an assignment only if: ■ Use of the hypothetical condition is clearly required for legal purposes, for purposes of reasonable analysis, or for purposes of comparison; ■ Use of the hypothetical condition results in a credible analysis;and ■ The appraiser complies with the disclosure requirements set forth in USPAP for hypothetical conditions. (USPAP, 2002 ed.) (p.141) Investment Value The specific value of an investment to a particular investor or class of investors based on individual investment requirements; distinguished from market value, which is impersonal and detached. See also Market value (p. 152) Leased Fee Interest An ownership interest held by a landlord with the rights of use and occupancy conveyed by lease to others. The rights of the lessor (the leased fee owner)and the leasee are specified by contract terms contained within the lease. (p. 161) Leasehold Interest The interest held by the lessee (the tenant or renter) through a lease transferring the rights of use and occupancy for a stated term under certain conditions. See also Negative leasehold; Positive leasehold. (p. 162) Market Value The most probable price which a property will bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: 1. buyer and seller are typically motivated; 2. both parties are well informed or well advised and acting in what they consider their own best interests; 3. a reasonable time is allowed for exposure in the open market; 4. payment is made in terms of cash in US. dollars or in terms of financial arrangements comparable thereto; and 5. the price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale. (12 C.F.R. Part 34.42(8); 55 Federal Register 34696, August 24, 1990, as amended at 57 Federal Register 12202, April 9, 1992; 59 Federal Register 29499, lune 7, 1994) (p. 177) Negative Leasehold A lease situation in which the market rent is less than the contract rent. (p. 193) Neighborhood A group of complementary land uses; a congruous grouping of inhabitants, buildings,or business enterprises. (p. 193) Positive Leasehold A lease situation in which the market rent is greater than the contract rent. (p. 215) Replacement Cost The estimated cost to construct, at current prices as of the effective appraisal date, a building with utility equivalent to the building being appraised, using modern materials and current standards,design and layout. (p. 244) CReproduction Cost The estimated cost to construct, at current prices as of the effective date of the appraisal, an exact duplicate or replica of the building being appraised, using the same materials, construction standards, design, layout, and quality of workmanship and embodying all the deficiencies, superadequacies, and obsolescence of the subject building. (p. 244) Use Value The value a specific property has for a specific use; may be the highest and best use of the property or some other use specified as a condition of the appraisal; may be used where legislation has been enacted to preserve farmland, timberland, or other open space land on urban fringes. (p. 303) ADDITIONAL INFORMATION SHANER APPRAISALS, INC. (W July 24, 2013 Jamie Reed General Manager Covington Realty Partners 573)893-5437(Office) (573)893-5447(Fax) jrccd@covingtonrealtypartners.com Jason Roos 10990 Quivira, Suite 100 Overland Park, KS 66210 jroosc1 valbridae.com Re: Capital Mall Property Conditions Dear Mr. Roos, Covington Realty Partners is the property manager for the Capital Mall property in Jefferson City,Missouri. On June 11,2013,1 personally toured the Capital Mall to view the property conditions on behalf of the property owner. During my tour I noted the following property conditions that appear to be relevant to your work in updating the blight study for the Capital Mall; Physical Deterioration and Potential Safety Issues. 1. Facades—The fagade of the mall property is in poor condition in several places. See enclosed picture 1 for an example of typical fatiade conditions. 2. Roof—The roof is in poor condition in several places. There are a substantial number of active roof leaks and signs of a history of roof leaks in 14 of 30 of the tenant areas observed. In addition, substantial repairs will be needed to the roof parapet. See enclosed pictures 2 to 11 for evidence of the roof condition and leaks found. 3. HVAC—The HVAC system is in poor condition. It has been recommended that 1I HVAC units be replaced in the short term due to their substantial deterioration, age and obsolescence. 4. Steel Service Doors—One-half of the steel service doors are rusted and deteriorated along the door jambs. See enclosed picture 12 for an illustration of the typical rusted steel door. 5. Painted Finishes—Several tenant entries are in need of immediate painting. 6. EIFS—Damn a was observed to the underlying fa ade at several of the tenant g Y g EIFS � S } entries, most notably at vacant spaces at the southern end of the building. See enclosed pictures 13 to 16. See also picture 17 for typical dried and cracked control joint sealant found on the throughout the fagade. 1 r July 24, 2013 Page 2 7. Suspect Mold—Visual signs of suspect mold have been identified two tenant areas. See enclosed picture 8 and 11. This is a safety and health issue, in addition to a deterioration issue. 8. Pavement—As you already noted the parking lot payment is highly deteriorated and in need of replacement. See enclosed pictures 18, 19 and 20 for recently taken of the parking pavement conditions. 9. Curbs—The curbs are deteriorating in several places throughout the property. See enclosed picture 21 of a damaged curb on the property that was typically observed. 10. Trip Hazard—At west side of JC Penney a trip hazard was identified. See enclosed picture 22. 11. Service Entry Lights—There are several damaged at lights over service entry doors. See enclosed picture 23 for typical missing lights over service entry doors. This is a safety issue as much as a deterioration issue. 12. Windows—Replacement needed at small anchor tenant at south end of building. See enclosed picture 24. Fire Safety. The fire sprinkler system has not been tested since October 2009 and it is supposed to be tested annually. Picture 25 shows the sprinkler riser with expired inspection tag. Clearly lack of testing is a fire safety issue. ADA Conformance. Although we have not had a full ADA review there are some known non- conformance issues. Some identified issues are: 1. ADA parking not properly marked. For example, one posted sign for multiple handicapped accessible spots. See enclosed picture 26. 2. No signage for wheel chair accessible facilities. Please contact me should you have any questions. Sincere] Jamie Reed - Enclosure Capital Niall Pictures—June 11,2013 1. Typical farads condition. 2. Roof surface. 45855216.2 �y NA 3. Roof a 4. Damaged roof and worn 5, Deteriorated surfaces and older re airs. 6. South side of roof with ponded water and vegetation growth. I 45855216.2 7.T ical sk li ht with ponded water damage. 8. Stained ceiling the with mold in tenant 52. 45955216.2 1 9.T ical stained ceiling tiles. I i 10. Typical stained ceiling tiles. 45855216.2 11. Stained ceilin tile with mold in tenant 406. 12.Typical rusted steel service door. 45855216.2 4 a r IL 13. Typical EIhS, brick veneer, and storefront windows 14,Damaged EIFS and paint at southern side of building. 458552W2 6.2 Mild 15. Dama ed EIFS and aint at southern side of buildin . 16. Damaged EIFS and paint at southern side of building. 45855216.2 i 1 • d 17. Dried and cracked control joint sealant. A, -'I"' I 18. Damaged asphalt pavement at entry to service area. 45855216.2 19. Damaged as Analt averment at Sears load* area. Wilt 7 20. Damaged asphalt pavement. 45855216.2 1 21.Typical damaged concrete curb. . 1 22. Trip hazard adjacent to JC Penney. 45855215,2 .j y 1 � 23. Steel framin viewed in service area. 24. Damaged window with water infiltration at vacant minor anchor tenant. 45855216.2 i r I 25. Fire sprinkler riser with expired inspection tag. r� ,jft��-4 26. Accessible parking with one sign for three spaces. 45855218,2 ICOSTAR News: National Real Estate Information October 03, 2012 Written by Randyl Drummer(rdrummer@costar.com) The De-Malling of America: What's Next for Hundreds of Outmoded Malls? Strained by Online Commerce, Changing Shopper Preferences and Trendier Competition, Marcy Outmoded Malls Face Bleak Future The widening gap between strong malls with rising sales and failing malls that are hemorrhaging retailers, sales dollars and foot traffic has led to dire forecasts by some analysts for the future of older enclosed malls as changing demographics and buying habits suck the life from aging and poorer quality properties. Many trade areas are unable to support multiple malls, with dominant properties increasingly attracting retailers and shoppers at the expense of outmoded centers, Some of these properties, memorably documented on web sites like Deadmalls.com, are so devoid of shoppers and stores that they may be suitable only for demolition or as sets for an episode of "The Walking Dead." REITs like Simon Property Group (NYSE: SPG) and General Growth Properties (NYSE: GGP), the nation's largest mall operators, have gotten the message and are busy divesting lesser-performing properties. Meanwhile, emboldened by low prices for these older malls, investors are beginning to snap up the properties, confident they can reposition and turn around malls that are on life support, or raze it to gain access to the often-valuable land to build apartments or other uses. The litany of issues facing distressed malls and large shopping centers is well documented, with ills ranging from changing neighborhoods, increased competition from online sales, the appeal of newer lifestyle and power centers, consolidation of anchor stores and sharp downsizing by in-line tenants. In a widely quoted report, Green Street Advisors has forecast that 1011Jo of the nation's 1,000 enclosed malls will fail by 2022, eventually converting to uses other than retail. Editor's Note: This is the first of a two-part Costar series on aging and distressed malls. Next week: What strategies have been effective as communities and owners try to reclaim a growing inventory of obsolete retail space? Age appears to be a contributing factor. Of more than 200 mails and large U.S. shopping centers with 250,000 rentable square feet or higher that are hampered by vacancy rates of 35% or higher -- a clear marker for shopping center distress -- 86.5% were built before 2000, according to CoStar Group data. Of these distressed regional mall, power center and community center properties, 43.5% were built in the 1970s and `80s, another one-quarter were built in the 1990s, and 17.5 oto were built in the 1960s and prior. The average center in the distressed group was built in 1983 and had a vacancy rate of 50.6%. Among the 44 regional and super-regional malls (usually malls of 1 million square feet or above) with distressed vacancy, the average rate was 54.50!0, with older super regional properties built from 1960 to 1990 averaging just under 60% vacant. We're Not Overbuilt, We're Under-Demolished "I don't think we're overbuilt, I think we're under-demolished," said Daniel Hurwitz, president and CEO of Copyright(c)2012 CoStar Realty Information,Inc.All rights reserved. CONTINUED:The De-Malling of America: What's Next for Hundreds of Outmoded Malls? DDR Corp., a Cleveland-based REIT, during ICSC's recent Western States conference in San Diego. "When you have [tenants] looking for space and nothing new being built, and we're sitting at mid-90% occupancy levels, it's hard to argue we're overbuilt when they're scrambling to find 10,000 square feet." "There is a sense of reality that we all have to come to that there are projects that are not going to lease. Retail has a finite lifespan and once you reach that lifespan, you can put up all the signs you want, and charge as low rent as you want, but that doesn't make [tenants] want to take the space." Follow Randy Drummer on Twitter for live news updates. As DDR's Hurwitz makes clear, shopper's preferences have changed and demand for large enclosed malls is quite different than it was 20 years ago. Changes in shopping patterns and preferences is also readily apparent in the shrinking number of department stores and the consolidation among traditional shopping center anchors like Sears Holdings, Kmart, Best Buy, The Gap and Office Max. All of those chains have announced plans to shut down stores in 2012. The announced closures for these five retailers alone could add another 15 million square feet of mostly mall and power center space to the market this year, according to analysis from Property and Portfolio Research (PPR), CoStar's real estate analytics and forecasting company. But analysts also see the closings and repositionings as a healthy process. As market forces cull weaker properties, successful malls grow stronger. "Malls and buildings age. We don't design for the life-cycle of buildings like we used to 50 or 60 years ago," said Robert Yuricic, an architect with Greenbergfarrow, a retail-oriented design firm and the second- largest restaurant architect in the country. "Malls are designed for a much shorter shelf span and they need to be refreshed." Many of the earliest malls were buildings connected by pedestrian walkways and common areas, similar to today's lifestyle center. Many malls began to turn inward in the 1960s and '70s, with the typical suburban mall composed of department stores and smaller shops connected by a roof, essentially forming an air-conditioned cave, Yuricic noted. Walking into such malls is "like going into the bowels of a casino, where the door seems to disappear and you can't find your way out," he said. "People want to go to what's new and shiny and if you don't give it a facelift, it becomes old and tired and not able to attract the younger, more chic crowd with more disponible income," Yuricic said. Kristin Mueller, executive vice president and director of retail business development with ]ones Lang LaSalle in Atlanta, has a simple message to those who would write their obituary: Malls are not dead. "The vast majority of the malls in the U.S. will continue to be incredibly relevant and are thriving," Mueller said. "There are many indicators that show malls are going very strong; you see it in their sales performance and in the REIT stocks of those that own two-thirds of the malls in this country. "There are many different ways that we as an industry are working with malls to make sure they're relevant for their shoppers and communities, usually through a combination of new retail and other alternative uses," Mueller said. Mueller acknowledged that some, "perhaps more than a handful," of the country's stock of 1,200 to 1,400 enclosed malls are in serious trouble. "Those malls have usually been unfavorably impacted by their surrounding communities, or they've been outflanked by bigger, better competition" from lifestyle and power centers, Mueller said. Copyright(c)2012 Costar Realty Information, Inc.All rights reserved. CONTINUED: The De-Malling of America: What's Next for Hundreds of Outmoded Malls? Distress is still a significant factor for these properties, even as the bear market for retail investment appears to be coming to an end and transaction activity is now at par with the average annual volume of the past decade. About 11% of total deal volume by dollar value over the past four quarters was from forced sales, down from nearly 20% in early 2011 but well above the average 1% from 2000 to 2008, according to PPR. It appears almost certain that the pipeline of distressed retail property will continue to flow, with plenty of commercial mortgage-backed securities (CMBS) loans backed by collateral that's behind on payments and carrying thin debt service coverage ratios. These distress deals often reflect financing issues rather than prevailing market conditions. Not surprisingly, their troubles have drawn the attention of Wall Street rating agencies that are sufficiently worried enough about the widening gap between the country's best and worst performing malls to put out warnings that could further affect the supply of credit and financing to the mall sector. Fitch Ratings said its "very cautious" outlook on U.S. malls has prevented the agency from rating some CMBS transactions this year. While it's fairly easy to understand the dynamics of the best and worst properties, the condition of the second-tier malls in the middle is more difficult to parse, Fitch said in a recent report. Fitch-rated deals include about 1,150 retail loans of over $20 million, many secured by malls. Of these, 126 are already in special servicing and 44 assets are real estate owned (REO) and many are among the largest contributors to Fitch Ratings' overall expected deal losses. Who Will Buy A Dying Mall? In its own report last summer, Moody's Investors Service also noted the widening performance gap between stronger and weaker malls. When a marginal mall defaults, losses can well surpass those typical for a commercial property loan. "Renovating or reconfiguring an underperforming mall may cost many millions of the dollars," said Tad Philipp, director of Moody's CRE research. "What's more, should the location lose its viability for retail altogether, the value to revert to land less demolition cost [will produce] an even greater loss." Overall, however, mall investment has actually been stronger over the past few years as a percentage of total retail investment than it was during the peak of the last cycle, said PPR real estate economist and retail specialist Ryan McCullough. CoStar COMPS data for the largest U.S. markets shows that mall investment comprised 34% of total shopping center transaction dollar volume from 2010 to the present, up from 28% between 2005 and 2007. "I don't think that investors have necessarily been scared off from malls due to the obsolescence of a subset of the category," McCullough said. "Investors, however, are pickier about the quality of the mall properties purchased today, which is showing up in the pricing data." On a dollar-per-square-foot basis, malls with a vacancy rate of 5% or less traded at a 45% premium over those with higher than 5% vacancies from 2010 to present. During the 2005-07 market peak, the premium was a negligible 2%, he noted. "The short of it is that investors are recognizing quality malls -- those with high occupancies, solvent anchor tenants, good population density and access to affluent shoppers -- as stable, low-risk, income- producing assets and will pay up for them today," McCullough said. Copyright(c)2012 CoStar Realty Information,Inc.All rights reserved. CONTINUED:The De-Malling of America:What's Next for Hundreds of Outmoded Malls? "Poor quality malls, on the other hand, are either not trading or selling at a steep discount, and perhaps are scheduled for demolition or conversion." "As an industry, we're not going to start throwing up malls as the economy recovers," added ILL's Mueller. "In fact we stopped building malls a while ago and started to build lifestyle centers in niche infill locations between malls." Instead, real estate services providers like Mueller and her ILL team are focusing on creative redevelopment and repositioning strategies for distressed properties. Often means changing out the type and size of the retail -- or considering non-retail uses, such as a university or health care facility. Mega- churches have taken over former anchor spaces. Others have become call centers and government offices. Even malls that continue to thrive are being redesigned as town squares - adding more entertainment and service elements. Simon Property is remodeling 15 to 20 malls a year, adding such amenities as electric- car charging stations and stadium-seating theaters. Malls today have to "provide a unique set of shopping, dining and entertainment experiences," Simon's President and COO Richard Sokolov told the New York Times, including scheduling 20,000 events a year to draw traffic, such as cooking demonstrations. As the mall's 50-year reign as the ultimate shopping destination appear to be coming to an end, CoStar News will look at examples of successful mall adaptations in a follow up story next week. Fallow Randy Drummer on Twitter for live news updates. Copyright(c)2012 Costar Realty Information, Inc.All rights reserved. News: National Real Estate Ipforrbaiwn October 10, 2012 Written by Randyl Drummer(rdrummer@costar.com) Can This Mall Be Saved? dements Needed for a Turnaround Include Lower Debt, Deep Pockets Despite Major Risks, Some Gutsy Owners and Investors Are Hoping To Cash In On Value-Add B-Mall Turnarounds and Repositionings Last week, CoStar News reported on the daunting challenges faced by hundreds of outmoded malls in remaining relevant in a increasingly Darwinian retail environment. In this, the second of a three-part series, we look at the signs that may signal a mall's days may be numbered, and how some gutsy investors are taking on the challenge of reviving moribund properties. According to retail property experts, changes in a couple of key vital signs often provide the first signs that a mall may be in trouble. Consistent declines in retail sales per square foot over an extended time is one big warning sign, according to Gerard V. Mason, veteran retail specialist and executive managing director of Savills US. Higher quality class A malls should take in at least $400 per square foot, while a decent B-class mall will yield about $350 a square foot. Any time a mall's sales fall below $300 per square foot, it's likely in very serious trouble, according to Mason. Likewise, a healthy mall anchor store should log $200 at least per square foot, and any anchor that falls below $100 a square foot is probably in imminent danger of closure. Another critical factor is a store's so-called health ratio, also known as occupancy cost, which is calculated by dividing the annual rent by total sales for the year. Healthy mall store ratios average about 11% - 12%. Any ratio above 15% will likely land the store on a landlord's tenant watch list, and above 20%, the store is probably destined to go dark. Once one or more anchors or junior anchors close, it sets off a chain reaction of reduced shopping traffic, increased financial pressure on smaller in-line stores and decreased revenue for maintenance and operations that can quickly send a mall -- along with many surrounding businesses that benefit from mall traffic -- into a death spiral. "The retail business is very Darwinian. Formats come and go, and right now is a very dangerous time to be invested in B malls," Mason said. "A lot of them will survive, but the competition has become almost overwhelmingly stronger than before the downturn." Cavernous Gap Between the Have's and Have-Hots On paper, U.S. regional malls are among the strongest performing types of assets for real estate investors. Total returns for publicly traded regional mall companies increased 48.5% at the end of the third quarter from a year ago, the highest among all retail types, according to the FTSE NAREIT US Equity REIT Index. But a cavernous gap divides the performance of top-tier malls that attract the trendiest retailers and rents are on the rise, and older, lower-grade enclosed properties that struggle to attract foot traffic. Only about one-third of the 1,300+ malls in the U.S. qualify as high-growth, investment-grade properties, according to Savills' Mason. "The recovery has been uneven across mall quality types," said Mason. "In the Midwest and other lagging Copyright(c)2012 CoStar Realty Information, Inc.All rights reserved. CONTINUED: Can This Mall Be Saved? Elements Needed for a Turnaround Include Lower Debt, Deep Pockets areas, the second mall in a three-mall town may be on the brink of not being worth its debt. The recession has exacerbated the gap between the mall haves and have-nots." As retailers review their sales performance per store with an eye on trimming costs, the under-performers at have-not malls are especially vulnerable to a round of closings. The ongoing trend among retailers toward smaller stores also contributes to the widening gap. Mall staples such as Old Navy, which used to occupy 25,000-square-foot stores, are now comfortable in 10,000 square feet. Even the mall in-line tenants have downsized to smaller, more productive stores. Vacancies from down-sizing retailers are often welcomed at successful malls as they provide an opportunity to sign more retailers at higher rents. But for a struggling mall, the empty spaces just reinforce a negative perception among shoppers. Meanwhile some retailers are simply foregoing B mall locations altogether, including Lululemon Athletica, a company specializing in high-end yoga-style exercise apparel. "We have focused on only being in very strong malls," said Christine M. Day, president and CEO, of Lululemon Athletica during a recent conference call with investors. "We've had a real estate strategy of not bundling or taking weaker malls, and we go to [lifestyle] centers or streets, which allow us to really drive our business through community." Sifting the Viable from Lost Causes In many cases, the prospects for reviving a dead mall as a viable retail property are not good. The best option may be to demolish and start over with a different use that does have demand, such as residential apartments. However, in cases where an older property has been over-shadowed by new competition, and the location continues to enjoy strong demographics capable of supporting a large retail presence, investors have been successful in repositioning former failed malls. In general, these successful turn-arounds appear to involve a combination of three main elements: deleveraging, 'de-malting' and deep pockets. Buying over-leveraged but otherwise viable malls out of foreclosure can provide investors with an opportunity to acquire the property at a basis low enough to justify paying for capital improvements and attracting retailers with lower rents. Rouse Properties Inc., (NYSE: RSE) and CBL & Associates Properties (NYSE: CBL) have both stepped up to buy B-class suburban malls, particularly where they can find so-called "only game in town"-type properties. Follow Randy Drummer on Twitter for live news updates. Earlier this year, Rouse acquired Grand Traverse Mall, a 590,000-square-foot enclosed mall in Grand Traverse, MI, out of receivership for $66 million. The mall was formerly owned by the upstart REIT's former parent GGP, which handed nearly a down malls back to its lender last year. In another recent example, West Manchester Mall, a 742,000-square-foot enclosed center built in York, PA, in 1981, recently sold to M&R Investors after spending more than a year on the market for $17.5 million -- less than $24 per square foot and far below the price the previous owner, The Lighthouse Group, paid several years ago. Mason, whose firm represented the seller, said the sale involved "a classic de-malling scenario." The 620/b occupied mall faced competition from York Town Center, a CBL & Associates-owned power center that opened a few miles away. After the power center opened in 2007, JCPenney and Value City Copyright c 2012 COStar Realty Information Inc.All rights reserved. I ) Y 9 J CONTINUED: Can This Mail Be Saved? Elements Needed for a Turnaround Include Lower Debt, Deep Pockets stores went dark at West Manchester,. but Lighthouse was able to lease the spaces to Wal-Mart and Kohl's. A Macy's department store and Regal Cinemas theater also anchor the center. However, sales at the in- line shops gradually fell and several national chains left the mall. The remaining shops have been converted to month-to-month leases and the in-line space will likely be demolished and converted to a big -box power center. "It was a classic case of too much mall GLA [gross leasing area] in a one-mall town," Mason said. "But it still had a reason to exist, with an excellent location, and there was a need for big box stores in the area." Many malls haven't aged very well and shoppers want to go where it's shiny and new. Any successful turnaround often requires a major property makeover. This may be even more true in highly competitive retail markets, such as Santa Monica. Before Macerich Co. removed the roof and completely remodeled and re-tenanted with interesting shops and restaurants, Santa Monica Place located at the bottom of the Third Street Promenade in Santa Monica, CA, was one of those old-school B malls with B tenants, noted Southern California retail property expert Steve Jaffe, executive vice president and general counsel with BH Properties. "Macerich has deep pockets and spent a lot of money and was able to raise the stakes and go upscale, but they already owned the mall," Jaffe said, conceding that new ownership might have a difficult time obtaining financing for such a venture. "It's one thing if you already own it and want to demolish, it's another to step into it as a new owner. Until the financing market heats up across the board, lenders won't readily finance what effectively would be vacant retail rehab projects without tenants lined up." NEXT WEEK: Costar spotlights 'have-not' malls that are using innovative strategies and drafting unconventional tenants to revive former troubled mall properties. Copyright(c)2012 Costar Realty Information, Inc.All rights reserved. MI,SS9URI DEPARTMENT OF ECONOMIC DEVELOPMENT COMMUNITY IMPROVEMENT DISTRICT NOTICE OF ESTABLISHMENT 67.1421.6 RSMo"Upon the creation of a District, the Municipal Clerk shall report in writing the creation of such District to the Missouri Department of Economic Development." I To the Director, Missouri Department of Economic Development: You are officially notified in accordance with Section 67.1421.6 RSMo the Governing Body of the municipality of City of Jefferson , Missouri has established a Community Improvement District by its adoption of Ordnance No. 15223 on the 21 day of January 20 14 Said Community Improvement District is known as: Capital Mall Community Improvement District and is established and shall be governed in accordance with the laws of the State of Missouri, specifically Sections 67.1401 through 67.1571 RSMo Signed this 27 day of January 2014 Clerk of the Municipality of City of Jefferson , Missouri. Send this notice to: Missouri Department of Economic Development Attn: Community Improvement District Notice of Establishment P.O. Box 118,301 W. High Street Jefferson City, MO 65102 Fax: 573-526-8999 Email: cd(a-Wed.mo.gov For further information or assistance call the Incentives Team at 573-526-0748. EXHIBIT C PROJECTED CID COSTS OVER 5 YEARS . YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 (2014) (2015) (2016) (2017) j (2018) ESTIMATED REVENUE $378,914 $400,816 $421,671 $443,371 $465,287 ESTIMATED EXPENSES ($378,914) ($400,816) ($421,671) ($443,371) ($465,287) Estimated Formation Costs ($75,000) Estimated Operation Costs $10,000) ($10,000) ($10,000) ($10,000) ($10,000) CID Improvement Costs ($293,914) ($390,816) ($411,671) ($433,371) ($455,287) 47691781.2