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HomeMy Public PortalAbout19-C-A-7 funding gap - 1 - Truckee Development Associates, LLC 1201 Pine Street, Suite 151 Oakland, California 94607 t: 510 547 2122 f: 510 547 2125 Exhibit C-A-7: Funding Gap RE: HCD Prop 1c IIG 2013 August 5, 2013 Mr. Eugene Lee, The Truckee Railyard is one of the more complicated project areas currently active in the state. The project has been a 15+ year collaborative effort between local citizens, Town Staff, Town Officials, and private interests. In 2009, the Town Council and Planning Commission both voted unanimously to approve an ambitious plan for redevelopment of the 35 acre railyard. Though there are strong sensitivities about the downtown’s 150+ year history, every living mayor from the Town’s history and over 100 citizens showed up to vocally support adoption of an ambitious plan that will ultimately triple the size of the historic downtown. This complicated but necessary infill site requires a tremendous amount of infrastructure to get underway and begin to revitalize downtown. The QIP and CIP are the key first steps to starting development of the railyard redevelopment. Because the site was historically a railyard, there is rail infrastructure but no roadway or utility infrastructure to support mixed use development. This was understood when the Truckee Railyard Master Plan was adopted, and it was anticipated that redevelopment bond proceeds would help pay for the ambitious development proposal. In the time since adoption, real estate values were decimated, decreasing the ability of development to help support the infrastructure costs both in gross revenue to the developer, who will pay a portion, and in tax increment to the Town, which would have paid the balance. Most notably, since the redevelopment agency was abolished before an enforceable commitment could be executed by the Town, there is now no capacity for the Town to support development with any tax increment bond financing. The town remains committed to the project and has allocated $1 million of AB1600 Traffic Impact fee monies, which are the only monies available to the Town to support the project in the wake of the loss of its redevelopment agency. The Town has no other funds available. The developer TDA, has committed to funding a portion of the infrastructure, but cannot fund any more without driving the price of housing beyond what the market will support, and thereby defeating the ability of the project to revitalize downtown. With the upfront infrastructure burden lessened by the assistance of Prop 1C, the Railyard can move forward as the catalytic force that it promises to be, creating more of a destination in Truckee, providing more workforce and mixed-income housing, and strengthening the downtown.