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iVIINUTES <br />CITY COUNCIL <br />APRIL 2,1997 <br />It was noted that rents camtot exceed 30% of income levels. Low to <br />moderate incomes are 60% of inedian income level. At that rate there <br />would be a cap of approximately $860 per month for a two-bedroom <br />apartment and $687 for a one-bedroom. <br />Brachman felt that while rent increases could be supported at The <br />Provinces, the maximum rents that would be allowed were too high for <br />this property. <br />Fahey again stated that the information he needs is the tenant mix at the <br />time application for the bonds was made. <br />Brachman reported that Dominium has made a substantial investment in <br />the community in terms of time and do111rs. Improvements have been <br />made to The Provinces property. Dominium is a long-term holder of this <br />property and would not do anything that would negatively impact the <br />property. Tax credits would allow Dominium to make additional <br />improvements to the site. <br />Fahey asked how the City could verify that Dominium was not turning <br />hi~her income p~rospective tenants away. <br />Brachman pointed out that there could be an agreement between the City <br />and Dominium that this would not occur. The agreement could provide <br />for stiff penalties if the terms were violated. Brachman further su~~ested <br />that the City could hire someone off the street to apply for housing at The <br />Provinces and see if they are turned away. <br />Ippel suggested that Dominium put rogether numbers showing the amount <br />of tax credits tl~ey would realize at various levels of low/moderate <br />desi~nation. <br />Urness repoited that State law restricts the fee a developer can take under <br />the tax credit program. <br />Fahey noted that the larger the percentage of units designated to <br />low/moderate income tenants, the higher the tax credits, the more money <br />the developer will have to put into improvements in the property, and the <br />higher the development fee the developer can take. <br />Urness reported t6at the development fee is limited by the total <br />development costs. Tlte more money is spent on the project, the higher <br />tlie fee the developer can take. <br />9 <br />