The question is the developer has negotiated a 20 year program but might be able to expand benefits to a 30 year program. What is the value for the additional tax benefits and how much should he be able to sell these benefits for if he maintains 10 percent ownership on the back end. The actual tax paid will be in any year the great of the two calculations % of egr or % of market.

30 year Pilot A B
Years through rate basis Years through rate basis
1 5 10% of EGR 1 5 0% market tax
6 10 10.50% 6 10 0%
11 15 11.00% 11 15 0%
16 20 11.50% 16 21 20%
21 25 12.00% 22 27 40%
26 30 12.50% 28 29 60%
30 30 80%
31 31 100%

EGR is \$1.8 million and grows 3% annually. Market tax is 420,000 and grows 3% annually

The tax is
20 year Pilot A B
Years through rate basis Years through rate basis
1 5 10% of EGR 1 5 0% market tax
6 10 10.50% 6 10 0%
11 15 11.00% 11 15 0%
16 20 11.50% 16 16 20%
17 17 40%
18 18 60%
19 19 80%
20 20 80%
21 21 100%
EGR is \$1.8 million and grows 3% annually. Market tax is 400,000 and grows 3% annually