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HomeMy WebLinkAboutItem #1 Clearwater FinancialCity of Chubbuck TIF Financing & CIDs September 2, 2026 1 Presentation Roadmap Three sections: who CWF is, how TIF financing works, and how CIDs can support infrastructure. 01 CWF Introduction Values, suite of services, and project- team bios. 02 TIF Financing How TIF creates capacity, what it can fund, and what the Chubbuck scenarios show. 03 How CIDs Work CID basics, eligible infrastructure, funding, formation, timing, and city considerations. 2CLEARWATER FINANCIAL | Overview Connection We consider the customer in all we do. Accountability We do what we say we will do. Respect We seek to understand differences. Ethics We maintain the highest standards of integrity. V A L U E S FUNDAMENTAL IN EVERYTHING WE DO 3CLEARWATER FINANCIAL | CWF Introduction Our Values Fundamental in everything we do. S U I T E O F S E R V I C E S DEVELOPMENT SERVICES – STRATEGIC/ COMP/MASTER PLANS, P&Z, SITE SELECTION, FACILITY PLANS, DESIGN TEAM & PROJECT MANAGEMENT BANKING SERVICES - RFP, LATENT FUNDS, PROCESS/SYSTEM INNOVATION, BOND FUND INVESTMENT ACCOUNTING – BUDGET AND ACCOUNTING SUPPORT, FINANCIAL PROJECTIONS AND POLICIES, WHAT IF, COMPREHENSIVE FINANCIAL PLANNING ECONOMIC DEVELOPMENT - URBAN RENEWAL, P3, DOWNTOWNS, LOT DEVELOPMENT RFP, HIGHEST-BEST-USE, MARKET ANALYSIS, ECONOMIC IMPACT PUBLIC ENGAGEMENT - ELECTIONS, SURVEYS, MARKETING, MESSAGING, SOCIAL MEDIA, INTERGOVERNMENTAL SOLUTIONS, REGIONALIZATION MUNICIPAL FINANCE - BONDS, PRIVATE PLACEMENTS, LEASES, BOND BANK, INSURANCE, RATINGS, DEQ & USDA-RD, IMPACT FEES 4CLEARWATER FINANCIAL | CWF Introduction Suite of Services CLEARWATER FINANCIAL | CWF Introduction Project Team Clearwater’s team combines municipal finance leadership with communication and project-support capacity. Jace Perry COO / CPA / Municipal Advisor Principal Jace is the former Executive Director of the Idaho Bond Bank Authority and spent 8 years managing accounting for the Sister’s Local Government Investment Pool and Diversified Bond Fund. He is a CPA and former municipal auditor with experience across public and nonprofit entities. •Licensed CPA and Chartered Global Management Accountant •Registered Municipal Advisor Principal •Series 50 and 54 License Sheridan Sylvester Project Manager / Municipal Advisor Representative Sheridan provides project management and multimedia content creation, with a focus on turning complex data into clear reports, materials, and public-facing communication. •Report development and data analysis •Project coordination and communication •Registered Municipal Advisor Representative 5 As the City’s Municipal Advisor, Clearwater Financial’s fiduciary duty to the City: Duty of Loyalty: We act in your best interest. Duty of Care: We possess the knowledge and expertise needed to provide the services we offer. TIF Financing 6 CLEARWATER FINANCIAL | TIF Financing TIF Financing Tools A typical term of the TIF is 20 years or shorter. Revenue Allocation Bonds Reimbursement Agreements Can be used to pay back private development of public infrastructure. Property Tax Increment Property taxes received by the URA can be used to pay back financing.Bonds issued to construct public infrastructure, paid back with TIF. 7 Revenue Allocation Bonds, Reimbursement Agreements, and Property Tax Increments make the TIF possible. Pine Ridge Mall Harvest Springs Northside Crossing TIFs are the Doorway to Steady Growth TIFs applied to the Yellowstone Corridor will create a self-sufficient revenue stream for the area. BASE VALUE The City sets a base property value. INCREMENT GROWTH As development happens, property values increase. FUNDS PROJECTS That increase—or “increment”—is reinvested into the area. 8CLEARWATER FINANCIAL | TIF Financing TIF uses growth in property value above the established base to help fund improvements within the area. CLEARWATER FINANCIAL | TIF Financing Scenario Inputs Base value, new private development, and the public improvement list. $126.9M Approximate 2025 base value for the area $292.1M Estimated new private development value 26 Estimated new private development projects $82.7M in potential public improvement needs for the Yellowstone Corridor 9 CLEARWATER FINANCIAL | TIF Financing Projected Revenue Scenarios Two valuation-growth assumptions frame the range of potential TIF revenue. Conservative Growth 2% annual valuation growth $51.6M Projected cumulative TIF revenue Meaningful reinvestment, with more careful sequencing and prioritization. Higher Growth 5% annual valuation growth $71.8M Projected cumulative TIF revenue Greater flexibility to advance priorities sooner or support a broader range of improvements. $20.2M difference between scenarios 10 CLEARWATER FINANCIAL | TIF Financing How Projected Revenue Compares to Identified Needs TIF can support a substantial share of identified projects, but prioritization remains necessary. Public project list $82.7M Higher projection $71.8M Conservative projection $51.6M The projected revenue range shows major implementation capacity, but it does not fully cover every identified improvement. Project selection and sequencing will matter. 11 Project Plans Source: Yellowstone Corridor Urban Renewal District Economic Feasibility Study CLEARWATER FINANCIAL | TIF Financing 12 Running The Numbers 13 TIF Financing Process 14 Construction Budget, O&M Projections Structure, Timing, Terms (Municipal Advisor advises on) Method of Sale Legal Documents, Sale, Closing CLEARWATER FINANCIAL | Running the Numbers Financing Scenarios High Revenue Projection, 1 Bond *The Total Borrowing Amount would equal Cash Available for Projects + Costs of Issuance 15CLEARWATER FINANCIAL | Running the Numbers Cash Flow Example High Revenue Projection, 1 Bond CLEARWATER FINANCIAL | Running the Numbers 16 Financing Scenarios High Revenue Projection, 2 Bonds *The Total Borrowing Amount would equal Cash Available for Projects + Costs of Issuance 17CLEARWATER FINANCIAL | Running the Numbers Compared to High Revenue Projection, 1 Bond More total Cash Available for Projects 2 Bonds: $37,065,000 1 Bond: $35,595,000 Less total Interest 2 Bonds: $13,496,034.40 1 Bond: $17,665,656.80 More Cash Remaining at End 2 Bonds: $18,971,374.85 1 Bond: 16,120.718.05 Cash Flow Example High Revenue Projection, 2 Bonds 18CLEARWATER FINANCIAL | Running the Numbers Financing Scenarios Low Revenue Projection, 2 Bonds *The Total Borrowing Amount would equal Cash Available for Projects + Costs of Issuance 19CLEARWATER FINANCIAL | Running the Numbers Cash Flow Example Low Revenue Projection, 2 Bonds CLEARWATER FINANCIAL | Running the Numbers 20 Now vs. Waiting 21CLEARWATER FINANCIAL | Running the Numbers Pros Reduces the impact of inflation Projects and upgrades available to the community sooner Upgrades may spur more economic development, increasing TIF earlier Cost of borrowing (interest and fees) Debt obligation of the URA Cons There are pros and cons to borrowing to do projects now rather than waiting. How CIDs Work 22 CLEARWATER FINANCIAL | How CIDs Work What is a Community Infrastructure District (CID)? A CID is a financing tool for growth-related public infrastructure. Definition A special purpose political subdivision authorized under Idaho Code Title 50, Chapter 31 Created to finance public infrastructure within a defined geographic area Costs are repaid by property owners within the district Enables “growth to pay for growth” Allows infrastructure to be built upfront Reduces immediate fiscal burden on the City Purpose 23 A CID is a separate district created for a specific area, typically tied to a development project. CID bonds are not obligations of the City. Because it is a separate district, a CID has it’s own governing body. What Can a CID Finance? Eligible infrastructure must serve a public purpose and become a public asset. Eligible infrastructure may include Key limitation CIDS cannot finance private vertical development. The improvements must become public assets. Roads and infrastructure improvements Water, sewer, and stormwater systems Parks and public open space Public safety facilities Other public improvements owned by a public entity Infrastructure must serve a public purpose Improvements must ultimately be publicly owned 24CLEARWATER FINANCIAL | How CIDs Work CLEARWATER FINANCIAL | How CIDs Work How is a CID Funded? Potential funding methods Special assessments on property within the district Property taxes within the district Special assessment revenue bonds General obligation bonds, if structured appropriately Most Idaho CIDs utilize special assessment revenue bonds backed by property assessments. Most common approach 25 Repayment source = property owners within the district CLEARWATER FINANCIAL | How CIDs Work High-Level Formation Process 1 Petition Submitted Signed by 2/3 of residents OR all landowners; includes district boundaries and infrastructure plan 2 File with Governing Body City council or county commission 3 Public Notice & Hearing Hearing is held 30–90 days after filing 4 Approval or Denial Governing body votes to form the district 5 Financing & Bond Issuance Assessments are levied and bonds issued (if applicable) 26 The process is petition-driven. The governing body has discretion to approve or deny. Estimated timeline varies bay complexity. Petition preparation 1–3 months Statutory hearing period 30–90 days Post-approval financing work 2–6 months Factors affecting timeline: project size, complexity of the financing, public engagement, and legal review. CLEARWATER FINANCIAL | How CIDs Work 27 Typical CID Timeline CID formation and financing typically takes 6–12+ months. Can a CID Be Required for Development?CWF State law Idaho statute does NOT automatically require CIDs for developments above a certain size. However A city may negotiate CID formation as part of development agreements, annexation agreements, or planned unit developments (PUDs). Cities cannot unilaterally impose a CID by ordinance alone; they must follow the petition and formation process under state law. 28CLEARWATER FINANCIAL | How CIDs Work Benefits to a City CIDs can help align infrastructure costs with the development areas that benefit. CWF ✓Infrastructure delivered upfront ✓Reduces strain on the general fund ✓Protects existing taxpayers ✓Improves capital planning predictability ✓Aligns costs with beneficiaries Core idea CIDs let infrastructure be financed upfront while repayment is tied to the properties that receive the benefit. Growth helps pay for growth. CLEARWATER FINANCIAL | How CIDs WorkCLEARWATER FINANCIAL | How CIDs Work 29 CID Considerations Items to evaluate ✓Market absorption risk ✓Assessment affordability ✓Bond market conditions ✓Administrative oversight requirements ✓Public perception and transparency Feasibility question Do projected property values support the assessment levels needed to repay bonds? This is where scenario modeling and clear public explanation matter. CLEARWATER FINANCIAL | How CIDs WorkCLEARWATER FINANCIAL | How CIDs Work 30 When Should a City Consider a CID? CIDs are most useful when infrastructure is significant and tied to a defined growth area. CWF ✓Large master-planned communities ✓Greenfield development ✓Significant infrastructure extensions ✓Areas where impact fees are insufficient ✓When city debt capacity is constrained BEST Best fit A defined development area with large public infrastructure needs and a clear beneficiary group. Not every project needs a CID CLEARWATER FINANCIAL | How CIDs WorkCLEARWATER FINANCIAL | How CIDs Work 31 CID vs. Impact Fees vs. LID Each tool assigns infrastructure costs differently. CWF CID Impact Fees LID Who pays?Property owners in district Developers (at permit) Property owners in district When paid?Over time (assessments/taxes) Upfront at building permit Over time (assessments) Bonding allowed?Yes No Yes Public vote required?No (petition process)No Typically protest period Scale Large master-planned Citywide growth Project-specific CLEARWATER FINANCIAL | How CIDs WorkCLEARWATER FINANCIAL | How CIDs Work 32 How Clearwater Financial Can Help CWF can support policy, modeling, issuance, and ongoing oversight for CID implementation Strategic Advisory Determine if a CID is appropriate Develop city policy framework Financial Modeling Infrastructure cost modeling Assessment projections Debt structuring scenarios Process & Compliance Prepare financial sections of petition Support hearings and council presentations Ensure statutory compliance Ongoing Oversight Monitor assessments Refinancing analysis Continuing disclosure support Administrative support CLEARWATER FINANCIAL | How CIDs WorkCLEARWATER FINANCIAL | How CIDs Work Once a CID... Serve as municipal advisor to the CID Work with developers to assist with bond sizing 33 Lead finance team procurement Coordinate marketing bonds with underwriters and bond counsel Optimize interest cost and risk allocation Lead issuance process High-Level Financing Process Financial feasibility and delivery planning can occur in parallel with engineering. CWF 01 Needs Identification Traffic studies Capital improvement planning Asset condition analysis 02 Cost Estimation Engineering estimates Phasing strategy Lifecycle cost analysis 03 Revenue Identification Evaluate available funding sources Assess legal constraints Determine funding gaps 04 Financing Strategy Cash vs. debt analysis Grant strategy Risk allocation 05 Project Delivery & Oversight Bond issuance (if applicable) Construction management Ongoing compliance and reporting CLEARWATER FINANCIAL | How CIDs WorkCLEARWATER FINANCIAL | How CIDs Work 34 Questions 35