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MINUTES <br />CITY COUNCIL <br />SEPTEMBER 23, 1992 <br />Scalze noted that part of the approval being requested <br />this evening is for bonding for another Presbyterian <br />Homes' senior citizen project in Bloomington. Scalze <br />reported that she had a question from a citizen about <br />the City's issuance of bonds for a project in <br />Bloomington. <br />The City Administrator explained that the bonding <br />approval beinq requested this evening does not result <br />in a financial obligation on the part of the City, but <br />just allows the City's tax-exempt status to be used. <br />If the developer were to default on the projects, the <br />City does not become responsible. The Administrator <br />noted that the Bloomington project is included at the <br />request of the developer in order to achieve an economy <br />of scale. By combining the Bloomington and Little <br />Canada projects, the developer will save front-end bond <br />issuance costs. The City is requiring that the cost <br />savings realized will accrue to the Little Canada <br />project. The Administrator also noted that the <br />developer will achieve a cost savings in that <br />Bloomington charges fees for such projects, while <br />Little Canada does not. Savings realized will be used <br />to keep rents down and make them more affordable. <br />Dan Wilson, the City's development consultant, reported <br />that the sale of housing revenue bonds are outside the <br />bonding capacity of the City, and does not limit the <br />City's bonding authority. <br />Wilson explained the Tax Increment Financing being <br />requested by Presbyterian Homes for this project. The <br />TIF assistance will be a"pay as you go" assistance, <br />that is, the assistance will be paid out as the <br />developer pays property taxes. If taxes are not paid, <br />assistance will not be paid to the developer. Wilson <br />further explained that a housing district is being <br />proposed, which can have a life of up to 25 years. It <br />is proposed that this district will have a 15 year <br />life, and the developer is requesting $700,000 in TIF <br />assistance to be paid out over a 13-year period. Wilson <br />reported that the TIF plan establishes the broad <br />parameters of the District, and the development <br />agreement that the City will enter into with the <br />developer will then establish the specifics and will be <br />more limiting. Wilson reported that the development <br />agreement is being drafted at this time. TIF <br />assistance is being requested to assist in land <br />acquisition, site improvements, landscaping, parking <br />improvements, lighting and utilities to the site. <br />Wilson explained Exhibit D in the Council agenda <br />packets which outlines the impact that the TIF <br />assistance will have on taxing jurisdictions. <br />Page 5 <br />