Proposed Residential PILOT

Program Outline
1. Create a trial program limited to 10 approved Projects. After 10 Projects the
EDGE Board and the Mayors of Memphis and Shelby County will evaluate the
program and determine whether to continue, modify, or discontinue the program.
2. Available for market-rate multi-family residential rental projects, including parking
a. Ground floor may include retail or other commercial uses
b. New construction or substantial renovation, as defined by the Board
3. Minimum Requirements:
a. 25 residential units
b. Applicant must own or control the site
c. Applicant must demonstrate proof of construction and post-construction
financing to close the PILOT
d. Sixty (60) percent of the total project costs must be spent on hard
construction and/or building renovation and site work
4. The PILOT rate and term:
a. Abate 75 percent of new City and County real property taxes, i.e., taxes
above the pre-development level
i. In unique cases, the EDGE Board reserves the right to waive this
provision and provide a Community Reinvestment Credit
b. PILOTs will be awarded a term based on the EDGE Residential PILOT
Scoring Matrix (attached) and the But For Test:
i. The maximum EDGE Residential PILOT term is fifteen (15) years
ii. The EDGE Residential PILOT Scoring Matrix identifies the
maximum PILOT term available for the Project
iii. The But For Test will confirm or reduce the PILOT term identified
by the EDGE Residential PILOT Scoring Matrix
1. Applicants must demonstrate the project cannot proceed
without the PILOT benefit
2. EDGE will analyze the Project pro forma, 3rd party market
analysis of comparable projects, and other data to determine
the need for the PILOT

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5. Financial Documentation Applicant will supply a:
a. Project pro-forma on a monthly basis through stabilization and then
annually through the term of the PILOT
b. Project source and use of funds
c. 3rd party market analysis of comparable local projects showing anticipated
rental and occupancy rates
d. Sponsor Principals annual financial statements for the past 3 years plus
an interim financial statement no more than 90-days old at the time of
PILOT application, for staff review
6. EDGE Local Business Participation program:
a. Will require an amount equal to 25 percent of hard construction and site
works costs to be spent with City or County-certified MWBEs
b. In addition, 25% of 3rd party contracts (by value) for the on-going
management and maintenance of the project must be spent with City or
County-certified MWBEs
c. Extraordinary Local Business Participation can add one (1) or two (2)
additional years to the PILOT Term
i. For one (1) additional year, spend an amount equal to 35% of hard
construction/site work and award 30% of the 3rd party contracts for
project management and maintenance to City/County-certified
MWBEs. Maximum PILOT is fifteen (15) years.
ii. For two (2) additional year, spend an amount equal to 45% of hard
construction/site work and award 30% of the 3rd party contracts for
project management and maintenance to City/County-certified
MWBEs. Maximum PILOT is fifteen (15) years.
7. Units Reserved Low and Moderate Income Individuals and Families
a. EDGE will require Projects to hold a specified percentage of units for
individuals or families that qualify as low or moderate income as defined
by the U.S. Department of Housing & Urban Development for the
Memphis area. For projects with 25-50 units, 10% (rounded up); for
projects with 51-75 units,15%; for projects with 76 or more units, 20%.
b. Applicants that provide an extraordinary number of low/moderate income
units will be awarded one (1) extra year on their PILOT, with a maximum
PILOT of fifteen (15) years.
i. For projects with 25-50 units, 20% (rounded up) must be held for
individuals or families that qualify as low or moderate income as
defined by the U.S. Department of Housing & Urban Development
for the Memphis area. For projects with 51 or more units, 30%.
8. Where an identifiable and credible community development corporation exists for
the area, EDGE staff will confirm the CDC is not opposed to the project.
9. EDGE will engage a local architecture firm to review proposals and advise the
Board. The intent is to ensure that:

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 a. Projects proposed for Residential PILOTs are of high quality for
architecture, construction, building systems and tenant finishes relative to
their area; and
b. Construction costs represented on the pro forma are reasonable
10. EDGE Residential PILOT Recipients will be required to submit Annual PILOT
Performance Reports and will be subject to periodic on-site inspections. Projects
determined to have not met their PILOT commitments will be subject to a claw-
back of PILOT benefits.
11. Standard EDGE PILOT insurance and environmental requirements will apply.
12. EDGE Residential PILOT Fees:
a. Application Fee is $3,000
b. Closing Fee is 7% of PILOT savings over the term of the PILOT, as
projected at the time of Application
c. PILOT Rent, Termination, Amendment, and Assignment Fees as in
other PILOT programs

May 17, 2017

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 EDGE Residential PILOT Scoring Matrix

CATEGORY YEARS
Residential Units Constructed or Renovated
10 units = 1 year of PILOT benefit

Location
Located in the City of Memphis 1
Located in a New Markets Tax Credit Eligible Census Tract 2

Local Business Participation Plan

Required LBP1 N/A
Extraordinary LBP2 1-2

Low & Moderate Income Units

Required Low & Moderate Income Units3 N/A
Extraordinary Number of Low & Moderate Income Units4 1

Environmental Sustainability (Limit 1)

Leadership in Energy & Environmental Design (LEED)
Certified or Silver 1
Gold or Platinum 2

Green Globes
1-2 Globes 1
3-4 Globes 2

Energy Star 1

1 Spend an amount equal to 25% of hard construction/site work plus award 25% of 3 rd party contracts (by
value) for on-going management and maintenance, with City or County-certified MWBEs.
2 For one (1) additional year spend an amount equal to 35% of hard construction/site work plus award

30% of 3rd party contracts (by value) for on-going management and maintenance, with City or County-
certified MWBEs. For two (2) additional years spend an amount equal to 45% of hard construction/site
work plus award 30% of 3rd party contracts (by value) for on-going management and maintenance, with
City or County-certified MWBEs.
3 For projects with 25-50 units,10% (rounded up) must be held for individuals or families that qualify as

low or moderate income as defined by the U.S. Department of Housing & Urban Development for the
Memphis area. For projects with 51-75 units, 15% must be held for low/moderate income; for projects with
76 or more units, 20%.
4 For projects with 25-50 units, 20% (rounded up) must be held for individuals or families that qualify as

low or moderate income as defined by the U.S. Department of Housing & Urban Development for the
Memphis area. For projects with 51 or more units, 30%.

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