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EDA MINUTES SEPTEMBER 22, 2003 DRAFT 41, 46 Ms. Divine indicated at the request of the Council they ran numbers showing from five years up to 47 eight years, with eight years being $1.1 million. She noted at five years the company's rental rates are 48 10 cents a square foot away from what the business had requested. If they went seven years it brings 49 them to $5.89 per square foot, which is .01 cent from the original request. She added their revised 50 request is $5.84. 51 52 EDA Member Dahl moved to close the public hearing at 6:20 p.m. EDA Member Bergeson seconded 53 the motion. Motion carried unanimously. 54 55 A. CONSIDERATION OF RESOLUTION NO. 03-06, APPROVING A CONTRACT FOR 56 PRIVATE DEVELOPMENT BY AND BETWEEN THE LINO LAKES EDA AND 57 PANATTONI DEVELOPMENT, LLC 58 59 Ms. Divine summarized the Staff report, indicating there have been minor language changes in the 60 last few days, but none of them affect the overall agreement. She stated Staff recommends approval. 61 She clarified that if the Board approves the agreement, they may, under separate motion, want to 62 authorize a Subordination Agreement. 63 64 Ms. Divine explained that section 5.2 discussed the Subordination Agreement, and she reviewed that 65 section for the Board. She noted the language is in all of the City's agreements, but if the lender 66 requests a separate Subordination Agreement it must be done under a separate motion. 67 • 68 EDA Member Bergeson asked if $127,000 a year is the total tax subsidy; City, School District and 69 County. Ms. Divine indicated it is. EDA Member Bergeson stated in terms of a decision on the 70 number of years, the City's portion would be about $40,000 a year. Ms. Divine indicated that was 71 correct. 72 73 EDA Member Bergeson moved to adopt Resolution No. 03 -06 approving a contract for private 74 development and awarding the sale of, and providing the form, terms, covenants and directions for the 75 issuance of its $638,400 tax increment revenue note, Series 2001, contingent on City Council 76 approval of the EAW and Preliminary Plat. EDA Member Bergeson seconded the motion. 77 78 EDA Member Dahl asked if this is the actual subsidy approval. Ms. Divine indicated it is; they are 79 approving $638,000, with the requirement of four new jobs over two years. 80 81 EDA Member Bergeson noted that at the work session EDA Member O'Donnell brought up the 82 subject of the `but for' test. He is not sure how to assess that. He stated the issue was raised, but he is 83 not sure they received an answer. He indicated this is an important project for the City and within 84 reason they need to do what it takes to make it work, but he does not know how to determine it meets 85 the `but for' rationale. 86 87 Ms. Divine stated that can be subjective, that this request was based on the target base rent needed to 88 make the project comparable to other rents. She indicated the City's TIF Consultant evaluation was 89 that five years stayed within the policy and scope of what has been approved over the last several 90 years, and was within the acceptable range. 2