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HomeMy WebLinkAbout2009-105 Council ResolutionCouncil Member Gallup introduced the following resolution and moved its adoption: CITY OF LINO LAKES RESOLUTION NO. 09 -105 RESOLUTION APPROVING AN ADDENDUM TO CONTRACT FOR PRIVATE DEVELOPMENT BETWEEN THE LINO LAKES ECONOMIC DEVELOPMENT AUTHORITY, THE CITY OF LINO LAKES, AND LINO LAKES LODGING, LLC BE IT RESOLVED By the City Council ( "Council ") of the City of Lino Lakes, Minnesota ( "City ") as follows: Section 1. Recitals. 1.01. The Lino Lakes Economic Development Authority ( "Authority ") administers Development District No. 1 (the "Project)" and Tax Increment Financing District No. 1 -11 (the "TIF District ") pursuant to Minnesota Statutes, Sections 469.124 to 469.134 ( "Development District Act ") and Sections 469.174 to 469.179 (the "TIF Act "). 1.02. The Authority, City and Legacy Holdings/Lino Lakes, LLC (the "Developer ") entered into a into a Contract for Private Development dated December 20, 2004, amended by a First Amendment thereto dated September 13, 2005 (the "Original Contract "), setting forth the terms and conditions of redevelopment of certain property within the Project, referred to generally as the Legacy at Woods Edge Project. 1.03. Lino Lakes Lodging (the "Assisted Living Developer ") proposes to acquire and convert the existing hotel that was previously developed within the Legacy at Woods Edge Project, and in connection with such conversion, the Assisted Living Developer, Authority and City propose to enter into an Addendum to the Original Contract (the "Addendum "). 1.04. The Council has reviewed the Addendum and determined that it is in the best interests of the City to approve the same. Section 2. City Approval; Further Proceedings. 2.01. The Addendum as presented to the Council is hereby in all respects approved, subject to modifications that do not alter the substance of the transaction and that are approved by the Mayor and Acting City Administrator, provided that execution of the documents by such officials shall be conclusive evidence of approval. 2.02. The Mayor and Acting City Administrator are hereby authorized to execute on behalf of the City the Addendum and any documents referenced therein requiring execution by the City, and to carry out, on behalf of the City its obligations thereunder. Approved by the City Council of the City of Lino Lakes, Minnesota this 23rd day of • November, 2009. • • ATTEST: The motion for the adoption of the foregoing resolution was duly seconded by Council Member Roeser and upon a vote being take thereon, the following voted in favor thereof: Gallup, Roeser, Reinert, O'Donnell, Bergeson The following voted against same: none Whereupon said resolution was declared duly passed and adopted. 2 • • • AGENDA ITEM 6B -i STAFF ORIGINATOR: Mary Alice Divine CC MEETING DATE: November 23, 2009 TOPIC: Resolution 09 -105 — Addendum to Contract for Private Development between the City of Lino Lakes and Lino Lakes Lodging, LLC BACKGROUND In 2004 the EDA and the City entered into a Development Contract with Hartford Development, Inc. and provided assistance within Tax Increment Financing District No. 1 -11. As pursuant to the contract, redevelopment occurred and a successor to the contract (Country Inn & Suites) redeveloped a portion of the commercial component of the minimum improvements as defined in the original contract. A developer is acquiring the hotel to convert it to an assisted living and memory care facility. The City has an interest in ensuring that the developer or its successors continue to pay real estate taxes on an assessed value that provides as much tax increment as before the conversion. This agreement obligates payment of taxes on a minimum assessed value of $3,750,000. The county assessor may, in actuality, place a higher value on the facility once final plans have been submitted, and the final assessed value will be executed in an assessment agreement that will be valid until the maturity date of the original contract. In order to provide the developer with a future option to sell the facility to a non - profit, the agreement requires a payment in lieu of taxes (the "PILOT Agreement "), for a period of 30 years if a non - profit owns the facility. Prior to the contract maturity date a non- profit would be required to make payment as if the property were subject to taxes. After the maturity date the annual payment would be only on the City's share of taxes RECOMMENDATION Staff recommends approving Resolution No. 09 -105. ATTACHMENTS 1. None. See Addendum to Contract for Private Development in your EDA packet.