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Fiscal Analysis for the Staples Ranch Development Project October 25, 2007 Page 4 A fiscal analysis could be used to test the fiscal implications of alternative levels of development (within the proposal), or different levels of increase in the revenue from auto sales, or a number of other factors beyond the City's control that could influence the ultimate character (and fiscal con- sequences) of the development project. Key Issues for the Fiscal Analysis The fiscal impact analysis of the Staples Ranch Development Project may be used to provide information about the following issues: ^ What would be the fiscal impact of the project as described in the RFP; that is, would reve- nues exceed costs? ^ How would City revenues be affected, if at all, by the new location of the auto mall? In particular, should the City expect an increase in auto-related sales tax revenues with the new location and configuration ofthe auto dealerships? Ifso, by how much? ^ Would the impacts be affected by changes in the timing/pace of development? by partial buildout ofthe project? ^ Would supplemental funding mechanisms be needed (or desirable) to assure a positive fiscal contribution? ^ What would be the fiscal impact of the project on the City of Pleasanton if Staples Ranch is not annexed to the City? SCOPE OF WORK The fiscal analysis for a large project with multiple uses is a complex set of tasks: each use must be described at a level of detail that allows for estimates of revenues that will be generated and costs that will be incurred. Different types of uses have different revenue- and cost-generating characteristics, and each of these must be identified to provide a sound and defensible basis for the analysis. To address the issues posed above, Mundie & Associates (M&A) would complete the following tasks: Task 1: Refine Project Description and Scope of the Fiscal Analysis We will meet with the City's project manager to refine our understanding of the project and dis- cuss assumptions to be used in the fiscal analysis. Project Description Among our questions about the project description are: The expected change in size of the auto dealerships that would relocate from their existing Pleasanton sites, and the amount of sales tax revenue currently contributed by those dealer- ships. We understand that sales tax information for individual establishments is confidential, and we would maintain confidentiality.