Search

A special meeting of the Board of Aldermen was held Thursday, March 1, 2018, at 7:00 p.m. in the
City Hal Auditorium.

President Brian S. McCarthy presided; Legislative Affairs Manager Susan Lovering recorded.

Prayer was offered by Legislative Affairs Manager Susan Lovering; Alderman Patricia Klee led in the Pledge to
the Flag.

The roll call was taken with 13 members of the Board of Aldermen present; Alderman Wilshire and Alderman
Lopez were recorded absent.

Mayor James W. Donchess and Corporation Counsel Steven A. Bolton were also in attendance.
COMMUNICATIONS

From: Brian S. McCarthy
Re: Special Board of Aldermen Meeting

There being no objection, President McCarthy accepted the communication and placed it on file.
PRESENTATION

Assessment Update Presentation

Mayor Donchess

Thank you Mr. President and thank you all for coming. Before we begin let me introduce some of the people
that you’re not used to seeing. From KRT, we have Ken Rodgers, President, and Bob Tozier, Vice President.
They will be speaking to you in a few minutes. Jon Duhamel back here is the City Chief Assessor. Of course
you know John Griffin who is the CFO. These are some of the people who've been involved in analyzing the
situation that | will give you the overview. I’m going to explain the overall situation where | think we are and
then KRT will undertake to explain more of the details regarding the proposed or the required re-evaluation.

Let’s begin with the legal requirements. Steve Bolton has been involved with this — the City Attorney — over
this entire time so he can of course answer any legal questions. Under the Constitution of the State of New
Hampshire and you see the provision of the Constitution on the slide and pursuant to a Statute that backs it up
passed by the legislature, every community in New Hampshire is required to reassess all property in the city
every five years. Nashua last did a re-evaluation in 2013. So 2018 is our year. As we began to approach this,
we began to communicate with the Department of Revenue Administration which is in charge of all of the
property taxation in the State of New Hampshire, in charge of the entire assessment and evaluation process.
We wanted to communicate to them for the reasons that I’m going to explain and we began with the idea that
we would like to take some additional time beyond 2018 to complete an assessment.

| think, and correct Ken and everybody can correct me if I’m wrong if I’m incorrect at all, but in general there
are kind of three approaches that we could take. We could simply kind of do a statistical upgrade based upon
the equalization rations that we have and | will explain what those are. A very minimal just kind of up the
valuations. Number two, we could take a more middle course to engage experts and take up a very thorough
look at a statistical upgrade where individual classes of property are examined and all sales are reviewed and
a much more thorough job is done. Or number three, we could do a full measure and list which is to engage a
firm like KRT not only to kind of look at all of the sales on paper and proceed with the process that will be
described to you but physically inspect all the properties in the city. The last time we had a full measure enlist
in Nashua was in 1991 and it was implemented in 1992 under very adverse circumstances because at that
time in 1990 there had been a very serious severe real estate recession — depression really. Public service
went bankrupt. Almost all the banks in Nashua either went under or were taken over. We saw huge declines
in property values particularly in condos and in commercial values just before the re-evaluation took place.

Special Bd. of Aldermen — 02/27/2017 Page 2

In any event what we did was as a result from some of the impacts we think the re-evaluation could have, we
approached the DRA and we asked whether we could have additional time in order to do a full measure enlist
for the first time in 27 years to physically inspect all the properties in Nashua. We think still that if we want to
capture all the value we have particularly in the commercial properties that would be the best way to proceed.
However, they first | think KRT talked with them in general then we met with them and what they told us is
absolutely not. What they want is this thing to be done this year pursuant to as they call it “statutory and
constitutional duties” even if we were suggesting we would do the most thorough job possible. They’re not
willing to grant any extensions. You see on the screen in front of you and in your packet a copy of a letter that
they sent us. Now the letter is less blunt than they were in person where they basically said look we’ll sue you
next week if you tell us you’re not going to do this. They said they would go to the Board and Land and Tax
Appeal, seek an order, and then seek an order out of the Superior Court to order the city to proceed.

Based upon that, we engaged further in discussions with KRT who have a lot of expertise in this area who are
only one or two entities that can work with the software that we have in the assessment area and they can
explain the details of that. A highly professional firm that we have confidence that can do a good job. So we
began to talk to them about how we might proceed. | will go further through the slides and kind of explain to
you the issues we see and why we need to proceed in a very thorough and professional manner and why we
think it’s very important that we undertake the approach since we’re being forced to do this undertake the
approach that | am suggesting. The main problem being that residential values — and you'll see some of the
specifics — have gone up significantly in the last five years. We think on average that residential properties
have gone up at least 25 percent in value. The good news there is that many people their homes are worth
$50,000, $60,000, $70,000, $80,000, even $100,000 more than they were five years ago. The issue that’s
created for the city and for our residential property owners our homeowners is that commercial values may not
have gone up as much. In fact, some of the statistics I'll show you suggest definitely not. Therefore when
values are taken from lower levels to 100 percent, it will result in a shift of property taxes from commercial and
industrial to residential property owners.

To kind of understand the way the system works, we have there is the concept of an equalization ratio. This is
a pretty technical definition and you can see it on the screen that’s given by the DRA. What it really means is if
in a category of property let’s say single family homes, the average home is worth 125 percent — if the average
home is assessed at $100,000 but if that average home is actually worth $125,000 on average across a broad
category of single family homes, the equalization ratio is .8 or 80 percent meaning that the assessment is 80
percent on average of the actual fair market value which means if you’re at 80 percent if you go to 100 percent,
the assessments will on average go up 25 percent. Justa little more background. The equalization ratio is
intended to result in all properties being treated relatively the same in the sense that if a new house is built
today and it has a value of $250,000 and sells for $250,000, you will not be on the rolls at 250. It will be put on
the rolls at 80 percent of real value. It will be put on the rolls at 200 so that it is treated the same as pre-existing
houses which on average are an 80 percent of value.

Within the area of assessments, DRA creates many different categories of property - single family homes,
condos, multi-family dwellings of four units or less, apartment complexes, and then various categories of
commercial property — industrial property, shopping mall type property. So there are a number of different
categories. To simplify the situation and we have and make it easier to kind of get an overview, we have
categorized the properties in Nashua in two basic areas — residential meaning single-family homes, condos,
and small apartment buildings — you know a couple of units, and then commercial values which include
everything else — shopping malls, multi-family complexes, industrial buildings, strip malls, and everything else.
If you look at the next slide, it shows you the approximate value of the approximate assessed value of these
two basic categories of property as they currently exist. If you look to the left, the light blue column you will see
that right now on the books we have residential property valued at about $5.3 billion. That is at an equalization
ratio the ER of about 80 percent. In other words, on average these residential properties are assessed at
about 80 percent of real value. Again on the left of this first side, the dark blue column shows you the
commercial and industrial properties with all together have a total assessed value of about $3.2 billion for a

Special Bd. of Aldermen — 02/27/2017 Page 3

total of about $8.5 billion. There are many more categories of property within the commercial and industrial
really than there are in the residential. There are several categories of property in the residential basically but
in the commercial/industrial, there’s a much more wider variety of property. It’s all sort of grouped. Some of
these categories may be kind of different equalization ratios than others.

| should have said at the beginning that these equalization ratios are only approximate because they’re based
upon sales which have occurred in the last so-called qualified sales which have occurred in the last year.
There are many residential sales that occur. So you’ve got a significantly larger group of data points to look at.
In the commercial and industrial area especially within the subcategories, there might be a handful or even
only one sale. For example in the area of residential apartment complexes, | think I’m correct in saying there’s
only been one significant sale in the last year. That was not qualified.

Qualification is another concept that is used in determining equalization ratios. For various reasons, the DRA
suggests that sales can be disqualified between relatives, or if a government entity is involved, and there’s like
20 different reasons for disqualification. A disqualified sale doesn’t necessarily mean that it wouldn’t be
considered in determining in a process like we’re asking KRT to do. It wouldn’t necessarily be disqualified and
determined in kind of looking at the market. Atleast in the context of the equalization ratio, it is disqualified. In
terms of the commercial and industrial equalization ratio, it is disqualified. In terms of the commercial and
industrial equalization ratio, we’re dealing with a relatively small number of sales with some having been
disqualified. The actual commercial values as compared with assessments might be something different than
this. Based upon what we’re looking at, we have a 90 on average across the commercial properties, we have
about a 93 percent equalization ratio. Meaning the average commercial property based upon the qualified
sales that have taken place is assessed at about 93 percent of its actual value.

If we use those equalization ratios and now move to the right and we upgrade the two categories of properties
to 100 percent, the $5.3 billion of property in the residential sohere increases to $6.6 billion. The good news
being there’s a $1.3 billion value out there that our homeowners possess that didn’t exist five years ago. So
people’s homes are worth a lot more. If we use this 93 percent equalization ratio and take the commercial
property to 100 percent, we only come up with $3.4 billion. On the left, you can see that the residential
property is about 62 percent of the entire value of the city. This is under current assessments and the
commercial property is 37 and change almost 38 percent of the current values — the total amount of the current
values. Were these equalization ratios simply applied to the property that exists, the residential property would
go to 66 percent of total value because it’s going up more based on these equalization ratios, based on the
scant number of sales, the preliminary view, but based upon the 93 percent equalization ratio for commercial.
Residential would climb to $6.6 billion which would then be 66 percent of the total value and commercial and
industrial although it would climb in terms of total value not as much so it would go down to 34 percent. The
relative split between residential and commercial would change.

What does this mean in terms of property taxes collected? We're just giving you a hypothetical on the next
page which is 6 of 14. $200 million is roughly what we collect. We collect a little bit more than that but it is a
good round number for analysis. Currently if we’re collecting $200 million based upon the values that we have
on the books, as | said, 62.4 percent or $125 million roughly is being collected from residential property
taxpayers. Whereas on commercial and industrial, nearly 38 or about $75 million is being collected from
commercial and industrial taxpayers. From the page before, you remember that we upgraded the properties
based on the equalization ratios. On that upgrade sort to speak, residential went to 66 and commercial went to
34 percent of the entire pie. Based on those new values because residential is now 66 percent not 62 on the
same $200 million, $132 million rather than $125 million would be collected from residential and $68 million
rather than $75 million would be collected from commercial and industrial. So what does that mean? It would
mean a shift of $7 million off commercial and not residential based upon the required adjustment in
assessments that the State is imposing.

What do we need to do? We think in reviewing a number of the commercial sales that have taken place that
we may not be capturing all of the commercial values that really exist in the marketplace. We need to make

Special Bd. of Aldermen — 02/27/2017 Page 4

sure that we do that so that we can mitigate the effect of the shift that you see on page 6 of 14. | think KRT
can correct me if I’m wrong but there are kind of three different ways you can evaluate a property. There’s the
sales analysis — what does something like that sell for. There might not have been a whole lot of sales and
they might not have been recent. Again in the commercial area these sales are less frequent. Number two,
the cost approach. How much did it cost to build this building and what’s the depreciation and that kind of
thing, or third, build an income model that uses market data and some information we can gather from
taxpayers themselves to determine what is the revenue generated by a commercial property and then based
upon that revenue and the appropriate capitalization rate so-called decide how much it is worth based on the
income approach. We think that if we analyze commercial properties in that way, we can come up with more
commercial value than we would be able to simply by using this 93 percent equalization ratio and just bringing
properties up according to that number. | could cite specific properties but there are properties that seem to be
generating a lot of income that don’t have very high assessments but there haven’t been a lot of sales in those
categories so it’s hard to peg their value with a five year old sale, or a two year old sale, or something like that.
We've seen some apartment complexes sell considerable higher than their assessments or at least one big
one which was disqualified for various reasons but still tells us a lot about the market.

In any event, we think that by engaging KRT to take a very detailed approach to look at all properties including
commercial properties to develop income models with respect to each category of commercial property that we
can maximize or increase to make sure that we capture all of the commercial values that actual exist out there.
Therefore mitigate the effect of the shift that could occur from the values that we see in analyzing this data.
Before | turn it over to them, I’d be glad to take any questions if you have any from me. | don’t know if | could
answer them but | would say that what could happen here, this shift of $7 million, this could mean that
someone’s taxes could go up 10 percent. That’s not what we want to see. We haven't even factored in the
budget here. We certainly don’t want to see that. We're happy that people’s houses has gone up in value.
We're happy that a family has $50,000 or $70,000 of equity that they didn’t have before but we certainly don’t
want to promote...we want to make sure that we’re correct and fair. We don’t want to unfairly increase
residential property taxes at the expense of while benefiting commercial properties if we don’t have to. So that
gives you this wonderful picture.

Alderman Dowd

For clarification, there are some instances — probably not many — but where residential or commercial property
values have gone down since the last time we took a look at it.

Mayor Donchess

We're talking averages now. | would bet there’s not a single residential property that has gone down but
commercial definitely. One thing | did not mention, something else, the homes that have a more moderate
value like those around $200,000 have gone up more in value than those higher up on the value scale. We're
talking average figures. The equalization ratio of homes in the $200,000 to $250,000 range is lower than 80
therefore their values are going to up more. Houses at the top haven't increased in value as much. The
impact will be more on the more moderately priced homes which is another thing we'd like to avoid. Any
questions now?

Alderwoman Kelly

So on the last page it said the medium assessment ratio might be between .9 and 1.1 — the standards first
statistical re-evaluation. | guess my question is are we required to do 100 percent or is it within that .9 to 1.1?

Mayor Donchess

KRT — now you’ve gone into the KRT area of the presentation. I’ve sort of taken you to the level of my
expertise. They’re far more knowledgeable than me.

Special Bd. of Aldermen — 02/27/2017 Page 5

Attorney Bolton

These are the ranges that DRA requires you to meet when you do the process we’re discussing.

Alderwoman Kelly

So | guess my question is why not just go to 90 instead of 100? 90 is the lowest right?

Mayor Donchess

| think if you said you were doing that, you’d have DRA problems.

Attorney Bolton

You probably could do it but you’d have the same problem you have if you go to 100 percent. Everything
would be raised to 90. The residential would have to go up higher to get to 90 percent or have to go up by a
greater amount on average than the commercials. In fact, the commercials might have to go down to get to
that number.

Mayor Donchess

Yeah that’s right. If we’re at 93 to take it to 90, you take the commercial values down not up.

President McCarthy

The end result of that will be just the tax rate is higher and the tax bills are identical to what they would have
been at 100 percent.

Alderwoman Melizzi-Golja

At least twice during your presentation Mayor Donchess you referenced a sale that was disqualified. Can you
identify what that sale was just so we have a sense of what it was that is not figured in here? Was it a public
sale and it was publicly disqualified? | would assume that’s public information.

Mayor Donchess

Some of these sales — well the one | was specifically referring to are the Kessler Farm apartments. It’s
technically like five different parcels but it sold all at one and it sold for $65 million against a $36 million
assessment. Now that was disqualified because it was a multi-parcel sale. If you ask KRT about a sale such
as — and there have been no other sales recently like that in Nashua so what does that mean? If you ask KRT
which | have, the market for a property such as that, very few of those in Nashua. Only one is sold might be all
of New England or all of northern New England so that sales that take place in Maine of similar size and
configured properties might reflect market value here. The people who trade in projects such as that, they’re
investing in apartments in kind of this area of the country. They’re not saying oh well you have to buy in this
town. They’re looking to invest money in real estate — you know multi-family, large complexes regionally.

Some of the sale downtown, there’s some sales downtown that suggest that residential buildings are also
selling for considerable more than appraisal. Now we're still within the residential realm although these are
residential buildings classified within the commercial and industrial segment because they’re not obviously
single family homes or condos.

Special Bd. of Aldermen — 02/27/2017 Page 6
Alderman Tencza

Thank you. So the last time the full measure and list was done in 1991/1992 but if | remember correctly you
were Mayor at that time as well.

Mayor Donchess

It was implemented after | left office.
Alderman Tencza

Okay. So what has been the method that the city has used since then and has it had an effect on what the
assessed values are today?

Mayor Donchess

Well | haven’t been involved but | think just kind of an in house statistical update. | don’t think people were
facing this situation where we’ve seen a rapid escalation of residential values. One thing | should have
mentioned, we’re not alone here. Portsmouth has been going through the same thing. Portsmouth did a re-
evaluation in 2015. They did one in 2010. They did one in 2015 and for whatever reason, | don’t think we
would do this but residential values went up so rapidly between 2015 and 2017 even though they were still
three years away from a required re-evaluation, they did another one and two years later in 2017 because
residential values had already climbed so much in those two years they wanted to do it again which they did.
In each case, it shifted property taxes onto residential property owners. You know what the porch of the
market is like, it’s rapidly escalating. | don’t think ours have gone up quite as much as that but it’s kind of the
same. A similar situation.

Alderman Klee

Thank you. | hate to ask this question but will this have an effect on the TIFF going forward with anything like
that?

Mayor Donchess

No. | would say no but we could talk about that in the context of the TIFF. Why don’t we turn it over to KRT to
introduce themselves and talk through more of the details of what will take place.

Ken Rodgers

Good evening. My name is Ken Rodgers. I’m the President of KRT and with me tonight is Rob Tozier the
Vice-President. We're the principal owners of the company. We have a combined 45 years of appraisal
experience. We brought over 150 projects. We've done communities from 1,000 parcels up to 38,000 parcels.
What we'd like to talk about first would be the standards of a statistical revaluation. The purpose of a statistical
revaluation is to obtain assessment equity between the different classes of property. Like every other
community in the State of New Hampshire, we use an April 1° date of assessment. We're looking at an
assessment date of April 1, 2018. We'll be analyzing sales from April 1° of 2017 to March 31, 2018. We have
to have a median assessment ratio between 90 percent and 110 percent. Coefficient of dispersion must be
less than 20 which we'll talk about that in a few minutes. The price related differential must be between 98 and
103.

As the Mayor stated, we use 3 approaches to value. We use the market approach which is looking at sales.
We use the cost approach which we'll look at the cost to build, look at depreciation, and if you look at land
sales and what we call land residuals. We look at the income approach so we'll get rents back, expenses, and

Special Bd. of Aldermen — 02/27/2017 Page 7

vacancy rates. We'll analyze those to develop a net operating income and we'll capitalize that to develop a
valuation for the property. It’s typically commercial and industrial properties and apartments over five units.

The Mayor talked a little bit about the assessment ratio. It’s just the relationship between the assessed value
and the market value of a property. An example would be if you had an assessment of $200,000 and it sold for
$250,000. The assessment ratio would be 80 percent. So it would be at 80 percent of market value. The
statistic that we use most often is the median ratio which is the middle of a data set. We'll look at all the sales
and array them from lower ratio to high ratio. We're looking for where the middle ratio lies.

The coefficient of dispersion probably the easiest way to explain this is is if you have your assessment ratio or
your median at 100 percent and you think of it as a bullseye, it’s how close those other ratios are to that center.
The tighter the better appraisal model that we’ve developed it predicts value better. Your price related
differential what that does is basically test low value properties versus high value properties and is the
relationship the same or different.

On a statistical revaluation, the process would be we begin in late March with a startup meeting with the city
and the Department of Revenue Administration. We would start by measuring and listing all the residential
sales from 4/1/17 to 3/31/18. On the commercials we'll look at a two year data set. The reason is those sales
are we're going to develop our model based on those sales so we want the most accurate information. We'll
analyze all the sales through various ratio studies. We'll look at where the deficiencies are and we'll update all
the tables as are indicated from the sales analysis. We'll analyze the income and expense statements
returned by commercial, industrial, and apartment owners and create income tables. Once the initial values
are set, we'll review all properties in the city so just a parcel by parcel review of every parcel in the city. Once
we’re finished with that, we’ll publicly post the values to notify the property owners of the new assessments.
We'll conduct taxpayer hearings so they can come in and ask us questions about their property or maybe just
an overall. When we’re completed with that, we deliver a USPAP which is Uniform Standards of Professional
Appraisal Practice Manual to the city and to the Department of Revenue.

The goals of a revaluation: it corrects disproportionate taxation by valuing all property at its fair market value
as of April 1, 2018. It adjusts value from market shifts, ensures that various class of property valued at the
same level of assessment. With that, it creates uniformity and assessment equity. It would create a mass

appraisal model basically using a systematic approach which gives us consistency. With that, I'll turn it back
over to the Mayor.

Mayor Donchess

Does anybody have any questions for KRT at this point?

President McCarthy

So would you actually complete the appraisal by April 1° or what’s the timing of the project?
Ken Rodgers

No | think the end date is October 1*.

Rob Tozier

That’s with the data value so there will be a value as of April 1°.

President McCarthy

So you would get it to us when we submit the forms for the tax rate setting for Fiscal ’19.

12,

13,

14,

15.

16.

1,

18.

19.

20.

21.

22,

23,

Clarify where to insert material markup.
a. “SCHEDULE B, COST PROPOSAL SHEET TEMPLATE” has been updated with clarifications.

Fixture material markup to be included in “Material Unit Cost Per Fixture” column.

Are municipal parking lots, garages included?
a. No, the City is only interested in converting existing roadway lighting that is billed under

rate EOL.

Does Eversource have a light pole map?
a. Eversource has no map that identifies our streetlights. The ledger indicates street and

pole information. The city’s GIS application may be of some assistance for visual
reference.

Clarify contractor’s responsibility to dispose old fixtures.
a. The Contractor hires a disposal contractor. The Contractor needs to provide Eversource
a bill of lading for disposal with counts for lamps, ballasts, photo cells and fixture heads.
Confirmation of above needs to be made with Eversource Environmental staff

Eversource does not require return of any retired equipment.

Does the City want dimmability?
a. ts dimmability available on the fixures without smart controls? If so, what would the

cost be? Please include the cost of any upfit necessary for potential future mounting of
smart controls.

Will evaluation/selection criteria be weighted?
a. There is no formula for the evaluation of proposals. As stated in the RFP, the City will

evaluate proposals using “best value” criteria.

Clarify desired receptacle.
a. The City deems 5-pin receptacles as adequate if 7 pin is required for Smart Controls

please specify.

Is there a submittal page limit?
a. No.

Provide searchable PDF of RFP.
a. We provided the Word document of the RFP.

Clarify what to do for various mast arm conditions?
a. lf in acceptable/good condition, use existing mast arms.
b. If in need of replacement, work with Eversource to replace mast arm.

What is the existing software used for water metering?
a. Please contact Pennichuck Water works at 882-5191,

Does the City want retrofit kits?
a. No.

RFPOGOS-031116 Addendum 1- City of Nashua LED Street Lighting Conversion Project Page 3 of 6

229 Main Street » Nashua, New Hampshire 03060 * Phone (603) 589-3330 e Fax (603) 589-3344

Special Bd. of Aldermen — 02/27/2017 Page 8
Alderman Jette

So using the income approach for commercial property is that different than what we’re doing now and what
we’ve done in the past?

Ken Rodgers

Yes | don’t think they’ve ever analyzed the income. Ina city as large as Nashua if a person is going to
purchase a property, they’re going to want to look at the income stream of that property and that’s really the
driving force of why they would consider it. Right now | think the only approach that they’re using is the cost
approach.

Alderman Jette

For sales, you say you use sales that will have occurred between April 1, 2017 and March 31, 2018. Why is it
limited to just one year? Why don’t you look at sales that occurred prior to that year?

Ken Rodgers

We can look at them. The Department of Revenue pretty much has the guidelines of what sales we need to
use. We will if we don’t have sales in certain classes. We'll go back a couple of years and maybe we have to
do a time adjustment on them to bring them up to current market. For the DRA’s analysis, that’s their period of
time.

Rob Tozier

Typically in a city you'll have far more sales to use. So one year would be sufficient to get enough data points
to create a valid model for valuation. You could have 1,000 sales to analyze which is a very large sample to
use in just one year.

Alderman Jette

So if | bought my house in 2000 for a certain price and | still own it and there hasn’t been a sale, how do you
value my house if it’s beyond that one year sales period.

Ken Rodgers

You're sales period is dictated in what the market is at this point in time. So we’re going to bring your property
up or down depending on the situation to market value as of April 1°". So the 2000 sale probably doesn’t mean
very much to us.

President McCarthy
It would seem to me that if you’re looking at sales of residential houses in an area like Nashua that has a huge
stock. A sale from last year of a house with similar square footage, the same number of bedrooms, same

utilities, similar neighborhood is more of an accurate predictor of market value in 2018 than a sale from 2000 of
that exact property.

Rob Tozier

Correct. Of course, yes.

Special Bd. of Aldermen — 02/27/2017 Page 9

Ken Rodgers

If you were to get a bank appraisal to refinance, that appraiser is just going to look down a few loans. They
won't even go back a full year. So when we're building a computer model for mass appraisal, we’re going back
an entire year to get the largest samples that are possible.

Alderman Jette

So when you're looking at a house, you’re not looking at what necessarily what that house may have sold for at
any point in time. You’re looking at what similar houses sold for within the last year to determine the value.

President McCarthy

If you want to put yours on the market for what it sold for in 2000, I'll talk.

Alderman Jette

| didn’t know you were looking.

Attorney Bolton

Until he could get that price.

Alderman Dowd

Actually that’s what a realtor’s price homes for sale right now then you look at comparables that have sold in
the last short period of time. My other question is from an income perspective relative to industrial properties if
it's a very large company with multiple buildings in the city and the surrounding cities and the income that’s

generated was probably spread over several of those buildings. How would you make any kind of estimate as
to the income generated by an industrial building like that?

Ken Rodgers

Well we’re looking at if that building was to be rented out. So we’re looking at just market rents. It doesn’t
matter as far as who the tenant currently is. If | were to own that building and rent it out to somebody, what
would | rent it for?

Alderman Dowd

I’m talking about manufacturing companies, engineering companies.

President McCarthy

Do you have a specific example in mind Alderman Dowd?

Alderman Dowd

Without stating it, yes. It’s not something that too many people would be able to rent.

Ken Rodgers

It’s probably kind of a specific question that I’d have to see the property and make a determination.