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Housing and Redevelopment Authority Minutes <br /> April 26, 1994 <br /> Page 2 <br /> Don and Judy Makowske, were present representing Mako for the discussion of Tax <br /> Increment Financing being used as funding for this proposed project. <br /> Mr. Thistle presented a report on the request for tax increment financing «!hick he <br /> distributed to those present. He stated that this is just a preliminary stage in the process. <br /> There has been one brief meeting with the developers and staff. Springsted's initial analysis <br /> raised as many questions as it answered. Mr. Thistle said more time is needed with the <br /> developers to clarify the proposals. At this point, there does not appear to be anything that <br /> would prevent the project from working. One of the issues that was discussed with the <br /> developers at the first meeting was pay-as-you-go on tax increments. Because this is a <br /> condominium project, a pay-as you-go is complicated. Mr. Thistle stated he is not sure that <br /> realistically pay-as-you-go would be very workable. The problem is that on a pay-as-you-go, <br /> the person paying the taxes is the person getting the benefits. He wondered how the benefit <br /> would be separated in a situation with a condominium where there would be potentially 24 <br /> tax payers and any one of them didn't pay. Mr. Thistle indicated something other than <br /> pay-as-you-go may have to be considered on this project. <br /> Mr. Thistle said he had had a brief conversation with Jerry Gilligan from Dorsey & Whitney <br /> and they agreed that the developers could have a new project set up or the existing Kenzie <br /> Terrace TIF Project could be extended to this location. In addition, 25% of the project's <br /> 4 <br /> proceeds are allowed to be spent outside of the District. The City has a policy of requiring <br /> the developers to put some money up front to defray the City's costs in case the project is <br /> not completed. Mr. Thistle suggested that some of those issues should be pursued. <br /> Chair Ranallo inquired if Mr. Thistle thinks the condominiums will sell in that area <br /> considering the problems involved when selling the condominiums at the Kenzington. <br /> Judy Makowske responded that condominiums are just one possibility that they are <br /> considering. Mrs. Makowske is of the opinion that townhomes would be better for the City <br /> and that they could be constructed in the proposed location. The developer would make that <br /> decision. Mako is not doing the developing themselves. <br /> Mrs. Makowske stated two parcels of their property have been repossessed and are owned by <br /> Mako, Inc. The other parcel is owned by Harry and Elaine Olson. There are three parcels <br /> of properties plus the alleys. The total amount of land that is just under two acres. She <br /> stated that the Makowske's interest is that they sold the land in 1981 and do not want to run <br /> apartments at this point in their lives. They want to sell the property to a developer or <br /> someone who would upgrade the property. <br /> Chair Ranallo questioned how they would come up with up front money without a developer. <br /> Mrs. Makowske anticipates having a developer and stated that Mako has been working with a <br /> person who will get a developer when it is known what the land.can-be used for. <br />