Tomorrow, Wednesday, July 21, there is another special meeting of the Hudson IDA (Industrial Development Agency). It takes place at 1:00 p.m. in Suite 301 of One City Centre. The notice of the meeting states its purpose: "This meeting is being held to discuss the Galvan's Foundation's [sic] 75 North 7th Street and 708 State Street projects."
here. This analysis is what needed to be completed before the IDA could schedule a public hearing.
Readers can examine the report for themselves, but what Gossips found most interesting were these findings. Under the head "Pro Forma Structure," BJH reported:
- The pro forma for 708 State Street was not structured correctly.
- Taxes were double counted, resulting in higher expenses/lower cash-on-cash return, and
- Replacement reserves were not included, resulting in lower expenses/higher cash-on-cash return.
BJH considers 708 State Street's cash-on-cash return between years 1 and 10 reasonable for attracting private capital; BJH also considers 75 North 7th Street's DSCR [debt service coverage ratio] over the same period to indicate the project is financially viable. However, 708 State Street's high returns by year 10 again suggest the developer could pay a higher PILOT (receive less benefits) over a shorter period.
In Appendix C of the document, BJH presents an alternative PILOT schedule for 708 State Street, one that lasts for only twenty years, and compares it with the PILOT schedule proposed by the Galvan Foundation, which goes on for twenty-five years. (Click to enlarge the charts below or find them here.)