09-07-2021 EDA Packet - Laserfiche WebLink

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• Provision of variety of senior housing options not previously provided for in the City by a well-established twin city care provider. REQUEST Delays in the project timing, most notably caused by the COVID pandemic, require modifications to the Contract for Private Development to address timelines for completion of required improvements. Additionally, due to the delay and increased construction costs resulting therefrom, the developer has requested an additional $500,000 in assistance to complete the project. Following review of the revised pro forma, staff is recommending an increase to the financial assistance of $400,000 for a total project assistance package of $4,000,000 as follows: 1. $344,000 from the Willow Ponds TIF District 1-5 for Qualified Development Costs 2. TIF in the amount of $3,600,000 for Qualified Development Costs The assistance from TIF District 1-13 will be on a “pay as you go” basis for site improvements, building and infrastructure costs. The EDA will issue a “note” in the amount of $3,600,000 in exchange for the improvements identified in the agreement. The developer will be reimbursed by tax increments generated by the development on an annual basis. The TIF note is expected to be paid off within 10 years based on an initial minimum taxable market value of $30,000,000. Should the taxable market value increase the note will be paid off sooner. The contract does include a provision to reduce the principal of the TIF note based on actual construction costs. The potential reduction is capped at $160,900 which represents a pro-rata share of any project cost savings. Additionally, the contract includes provisions for the EDA to share in the profit of any land sale proceeds for the commercial area if said proceeds exceed 105% of the developer’s acquisition costs. Julie Eddington, the EDA’s Development Attorney, will be present at the meeting to address any questions from the Board. RECOMMENDATION The proposed project will increase the City’s tax base, provide senior housing opportunities, provide needed infrastructure improvements and serve as a catalyst for redevelopment of an important community gateway. Staff is recommending approval of Resolution No. 21-01. ATTACHMENTS 1. Map of TIF District 1-13 2. Resolution No. 21-01 3. Contract for Private Development