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Natalie Verlinich, City of Santa Ana <br />April 15, 2016 <br />First Street Apartments: Financial Gap Analysis Page 12 <br />3. The Developer targeted a 46% tiebreaker score for the competitive TCAC <br />application process. To obtain this tiebreaker score it is necessary to reduce the <br />Project's requested eligible Tax Credit basis to $8.65 million. <br />Tax Credit Proceeds <br />KMA estimates the net Tax Credit proceeds at $11.23 million based on the following <br />assumptions: <br />1. KMA calculated the gross Tax Credit amount for the Project at $10.12 million <br />based on the following assumptions: <br />a. The Project is located in a designated "Difficult to Develop" census tract. <br />This allows the requested eligible Tax Credit basis to be increased by 30%. <br />The current Tax Credit regulations set the annual Tax Credit rate at 9.0%. <br />This rate is applied over the 10 -year Tax Credit period. <br />C. 100% of the Project's building area is located in units that qualify for Tax <br />Credits. <br />2. The net syndication value supported by the Tax Credit is ultimately determined <br />based on competitive market conditions and on the timing of the disbursements. <br />Based on currently available information, KMA and the Developer estimated the <br />proceeds at $1.11 per gross Tax Credit dollar. <br />Estimated Financial Gap <br />Based on the assumptions outlined in this analysis, KMA estimates the Project's financial <br />gap as follows: <br />Total Development Costs $28,506,000 <br />(Less) Total Available Outside Funding Sources (19,711,000) <br />Financial Gap $8,795,000 <br />Per Unit $127,500 <br />1604007:SA;TRB <br />19090.014.001 <br />65A-52 <br />