Economic Development Incentive Committee - June 27, 2023 Minutes

ECONOMIC AND DEVELOPMENT INCENTIVE COMMITTEE
Fargo, North Dakota

Regular Meeting Tuesday, June 27, 2023

The June meeting of the Economic and Development Incentive Committee of the City of Fargo, North Dakota was held in the City Commission Room at City Hall at 1:00 p.m., Tuesday, June 27, 2023.

The committee members present or absent are:

Members Present: Dave Piepkorn, John Cosgriff, Jon Eisert, Mayor Mahoney, Jim Buus, Jim Gilmour and Lucas Paper.

Members Absent: Jessica Ebeling

Others Present: Jackie Gapp and Levi Bachmeier

Commissioner Piepkorn called the meeting to order at 1:00 p.m.

Minutes Approved

A motion was made by John Cosgriff to approve the minutes from May 23, 2023. Jon Eisert seconded. Motion carries.

Criteria for Public Private Partnerships

• 6 different criteria
o Public Benefit (0-50 points)
o Property Value Increase (0-50 points)
o Need for Public Assistance (Pass/Fail?)
o Design (0-25 points)
o Infrastructure (0-25 points)
o Competition with other development (0-50 points)
• Would create tourism for Fargo
• Need an answer by July 24, 2023
o A special meeting was requested by Jim Gilmour
 Move EDIC meeting up a week to July 18, 2023
o A sub-committee needs to be put together
• Commissioner Piepkorn wants an opportunity for public comment
• Will vote on the policy at the next meeting.

Motion to create a subcommittee to configure the policy before the next meeting was made by Commissioner Piepkorn. Jim Buus seconded. Motion carried.

Wave PILOT Request
• Matt Steinberg- PFM
• Internal rate of return- 10 year period. Sale of property in 10 years
o Without public assistance- 11.5% With public assistance- 15%
• 17 year basis- just under 16% return
o Typical range for a IRR for multi-family housing is 14-22%
• Adding more equity ($1.75 million) to this project would change the IRR
o 17 year- 15.3%
o 10 year- 14.4%
• Debt Service Coverage: 1.5% coverage is required for the first 6 years without public assistance.

Questions:

• Jim Gilmour: Would a 10 year PILOT be sufficient?
o 10 years seems to be sufficient giving the coverage and IRR is still in the acceptable range for just the WAVE resort and the hotel.

Motion to approve 10 year PILOT contingent on $180 million investment was made by Mayor Mahoney. John Cosgriff seconded. Motion carried.

The meeting was adjourned at 1:49pm.