MEMORANDUM

January 14, 2013

To: The Honorable Vernon Archer

Town of Riverdale Park 5008 Queensbury Road Riverdale Park, MD 20737

From: Thomas Himler, Deputy Chief Administrative Officer for Budget, Finance and Administration Aubrey Thagard, Assistant Deputy Chief Administrative Officer for Economic Development and Public Infrastructure

Re: Cafritz Property at Riverdale Park – CSX Crossing Public Funding

We greatly appreciate the opportunity to review the proposal for the development of the Cafritz Property at Riverdale Park in order to assess the level of financial incentives that the County Government is willing to entertain for this important project and the public-private partnership to construct the CSX crossing (the “Crossing”).

As this project represents the northern gateway to the Town of Riverdale Park, and it is an important catalyst for the continued redevelopment of the US Route 1 corridor, the County believes that the developer is committed to delivering the following core elements:

A Whole Foods Market grocery store; A high-quality mixed-use project; The Crossing; Minimum of 950 residential units; Adequate parking spaces to ensure the success of the project; and Minimum of 150,000 square feet of retail.

County financial support will be based upon substantial agreement with these core elements. Based upon our review of the various financial incentives, the County is willing to consider a combination of incentives for this project such as i) economic development incentive funds, ii) revitalization tax credits, and iii) partial or full waivers of the following: WSSC system development charges, and site plan, building and Crossing related permit inspection and review fees. Although actual incentive amounts will depend upon the final project scope, project schedule, and real property assessed

valuations, the County is willing to support a total incentive package up to $6 million from these incentives.

In order to provide the Developer with additional public subsidies to construct the CSX crossing in compliance with the zoning requirements, the County is also willing to consider issuance of tax increment financing (“TIF”), special taxing district, and/or PILOT bonds for the project. The County is willing to support a total incentive package up to $6 million from these types of financing incentives.

We understand that the Town of Riverdale Park has also indicated a willingness to contribute funds towards the construction of the CSX Crossing, and that the vehicle for this contribution could be a Riverdale Park TIF -- either distinct from, or in conjunction with, a County TIF. In light of the foregoing, the County has reviewed the “CSX Crossing Funding Plan” enclosed herewith as Schedule 1, and offers this Plan as one example of how the public financing for the CSX Crossing might be achieved. You will note in your review of this Plan that -- in addition to the Developer’s privately funded $5MM contribution toward the Crossing - the Town of Riverdale Park is paying for roughly 1/3 of the cost of the public funds committed to the Crossing, whereas the County is paying for 2/3 of this cost.

In closing, we appreciate the opportunity to participate in this important economic development project. We look forward to working with you and other Town leaders in the future as we all work to make the Cafritz property at Riverdale Park a success. If you have any questions, please contact me.

cc: The Honorable Eric Olson, County Council Member, District 3

Bradley W. Frome, Deputy Chief of Staff

Carla A. Reid, Deputy Chief Administrative Office for Economic Development and Public Infrastructure

Schedule 1 

CSX CROSSING FUNDING PLAN 

I.  Total CSX Crossing Budget  

a.  Construction Budget:            $10,797,8381  

b.  Right of Way Acquisition Costs –           $1, 500,0002 

c.  Financing Transaction Costs –           $400,0003____ 

                                                                          $12,697, 838 

 

II.  Total CSX Crossing Sources of Funds 

a.  Developer Contribution:             $5,000,0004 

b.  Public Financing Contribution (see i‐iii below):         $7,697,838__ 

                                                                                                                           $12,697, 838 

i.  Prince George’s County Project Fee Waivers ‐      $2,932,3925 

ii.  Prince George’s County Special Taxing District Note ‐   $2,393,6966 

iii.  Town of Riverdale Park TIF Note ‐‐       $2,371,7907     

            $7,697,838 

 

                                                            1 Based on DPWT Estimate 2 2 acres @ $15 psf 3 Bond/Note Issuance Costs, Financial Impact Studies, Related 3rd Party Consultant Costs 4 Per Condition 25 of Rezoning Order  5 WSSC fees for 126 Town Homes, 278 Multifamily Units; Building Permit fees for 180, 949 sq ft of retail improvements: DSP Site Plan Waivers, Permit and Inspection fees related to Crossing 6 Par value 7 Par value