CC PACKET 05121998 - Laserfiche WebLink

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® MEMORANDUM DATE: April 25, 1998 TO: Mike Morrison, City Manager FROM: Roger Larson, Finance Director ITEM: TAX INCREMENT/EVERGREEN TOWNHOMES In September of 1989, the St. Anthony Housing and Redevelopment Authority and the developer entered into an agreement to develop an area of the City now known as Evergreen Townhomes. Soil correction was financed by tax increment at a cost of$267,000 plus interest. Pursuant to the agreement, any year in which the tax increment should exceed the amount necessary to pay the costs authorized by the TIF, the H.R.A. shall (commencing 1/1/93) use the excess amount to pay for the cost of the soil correction note. Upon completion of the 1997 H.R.A. audit, the TIF District's excess increment for '97 totals $69,771.33 and is payable per the agreement. Jerry Gilligan from Dorsey & Whitney has • confirmed the terms of the agreement. Past year payments included: $ 25,932.00 in 1993 $ 50,173.09 in 1994 $ 59,058.24 in 1995 $ 64,199.17 in 1996 $ 68,260.59 in 1997 $267,623.09 Recommendation Council approve payment to Norwest Investment Services, Inc. in the amount of $69,771.33 ($17,755.25 interest and $52,016.08 principal). Payments to date total $337,394.42. In previous payments to Norwest, 10% percent of each year's revenues were retained to cover administrative expenses. The fund balance is now adequate to cover those costs, which allows further pay down of the principal & interest owed. Current projections show this payment will be an annual occurrence until year 2001 which is the • last year of the district (the remaining principal after this payment totals $138,604.55). Norwest has informed me that 3 more payments ('99,'00 & '01) of$55,833.00 will satisfy the debt.