EXHIBIT B
PORTLAND DEVELOPMENT COMMISSION
Executive Summary Raven Apartments §103.3 TOD Tax Abatement
1) In which year does the project reach 10% IRR and what is the IRR by year, with and without the abatement?
Year | IRR with Abatement | IRR without Abatement |
investment year | investment year | |
1 | -98% | negative 100 + % |
2 | -80% | negative 100 + % |
3 | -60% | negative 100 +% |
4 | -43% | negative 100 +% |
5 | -31% | -96% |
6 | -22% | -57% |
7 | -16% | -42% |
8 | -10.5% | -32.6% |
9 | -6.4% | -25.4% |
10 | -3.3% | -19.7% |
… |
| … |
52 |
| 10.0% |
2) Foregone Revenue
The estimated ten-year value of exempted tax revenue is approximately $221,667 in today’s dollars (assuming a 7 percent discount rate, a three percent annual assessment increase and $20.03 per $1,000 mill rate.)
3) Recommendation is for approval of the tax abatement for ten years.