The applicant is eligible for a $30,000 loan, to be repaid over a 5 year period. Typically Administration would recommend that the agreement be designed so that the 5 year loan is paid back using the eligible grant from the annual tax increment from the Revitalization Grant Program. That is, $6,000 will be subtracted from the annual tax increment over the first 5 years of the program.

The applicant proposes to spend approximately $225,000 for improvements made to the Sandwich Street (east facing) facade and additional money will be spent on improvements to the remaining building facades in the future. Due to the age of the building, the assessment value attributable to commercial space is very low. Because the eligible renovation work only includes exterior (interior remains the same) improvements and the applicants do not propose to add any new building area it is difficult to estimate whether there will be an increase in assessment value at this time. Should the assessment value increase as a result of the improvements made by the applicants, Administration is seeking approval to administer the tax increment grant.

Mixed Use Building Improvement Loan Program This program provides a no interest loan equal to 70% of the cost of eligible interior and exterior building maintenance and improvement works to commercial and mixed use buildings located within Target Areas 1 and 3, up to a maximum loan per property/project of $30,000. The minimum loan per property/project is $10,000.

However, as indicated above, it is unlikely that the improvements will result in an increase in tax assessment or that the increase will be sufficient to repay the loan over the required 5 year term. As such, Administration will ensure that the repayment dates concerning the Mixed Use Building Improvement Loan Program will be clearly identified in the registered agreement between the City and applicant. If the applicant fails to pay the agreed upon amount by the stated date the amount due will be added to the property tax roll and collected in the same manner as property taxes.

Risk Analysis:

The Building Division will continue to ensure that improvements are consistent with drawings and in compliance with the Ontario Building Code and applicable law (e.g. zoning by-law). A review of the drawings will be conducted to ensure that the City’s incentives are being used appropriately and the City is receiving good value for the public investment allocated through the Sandwich Incentive Program(s). As a requirement of Section 28 (7.3) of the Planning Act Administration has confirmed that, the Grant amount does not exceed the total cost of the project.