02/23/2005 Council Minutes - Laserfiche WebLink

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CITY COUNCIL WORK SESSION FEBRUARY 23, 2005 APPROVED • 1 CITY OF LINO LAKES 2 MINUTES 3 4 5 DATE : February 23, 2005 6 TIME STARTED : 5:13 p.m. 7 TIME ENDED : 8:20 p.m. 8 MEMBERS PRESENT : Councilmember Carlson, Dahl, Reinert, 9 Stoltz and Mayor Bergeson 10 MEMBERS ABSENT : None 11 12 13 Staff members present: City Administrator, Gordon Heitke; Community Development 14 Director, Michael Grochala; City Engineer, Jim Studenski; Chief of Police, Dave Pecchia 15 (part); and Community Development Assistant, Mary Alice Divine (part) 16 17 YMCA DEVELOPMENT AGREEMENT, MARY ALICE DIVINE 18 19 Community Development Coordinator Divine advised a very basic development 20 agreement was distributed in the Council packet. The agreement outlines the YMCA 21 responsibilities as well as the City's commitments. She reviewed the responsibilities of 22 the YMCA noting there will be as discount rate for Lino Lakes' residents for five years as • 23 24 well as a waiver of joiner's fees for the first three months of operation. There will also be additional "open membership" periods for the next five years. 25 26 Community Development Coordinator Divine advised the tax impact on Lino Lakes' 27 residents for the City's $1.5 million dollar commitment starts out at $20 per year on a 28 $228,000 home, and declines over the 15 years of the bonds. The total impact on a 29 $228,000 home is approximately $230 over 15 years. A resident joining the YMCA 30 could recover that impact in less than four years. 31 32 Mr. Steve Bubul, Kennedy & Graven, advised the City's commitment to the project is 33 $1.5 million dollars. He recommended the City use abatement bonds to finance that 34 expenditure. He explained the use of abatement bonds, noting the term would be for ten 35 years. Benefits include a low interest rate. The disadvantage is the City won't collect 36 taxes from other properties within the non -Tax Increment Financing (TIF) District. The 37 YMCA needs to finance approximately $2.5 million dollars. The City can help with that 38 by issuing tax-exempt bonds. Issuing bonds is not a commitment of City funds. The 39 City could still own the land and building and lease them to the YMCA to pay for those 40 bonds. The other alternative is to issue a bond and loan the money to the YMCA, using 41 loan repayments to secure the bonds. 42 43 Community Development Director Grochala advised staff is asking the Council to affirm 44 the development agreement at the regular Council meeting on Monday. The Council at a 45 future meeting will review the actual financing package. • 46