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1 REGULAR COUNCIL MEETING 2 AUGUST 25 , 1992 0 PAGE 7 5 6 Some of the benefits of this project is that it will attract 7 other new businesses which may have located elsewhere, it 8 affords opportunities for employment and the secondary spinoff 9 of the project can be improvement of businesses in nearby 10 locations . The quality of a development is enhanced by tax 11 increment financing and the City has better control over the 12 nature of the development if it takes place in a tax increment 13 financing district . Mr. Thistle advised that income from the 14 district may be used for administration costs and/or 15 commercial development up to ten percent . 16 17 The Development Agreement is between the City and the land 18 owner. The agreement- defines the type of financing which can 19 be used and may require that the City put in some public 20 improvements. 21 22 The Development Agreement protects the City in that it 23 stipulates the market value of the development and the 24 completion date of the redevelopment . If that date is not met , 25 the City can withhold bond proceeds until the developer 26 completes what is being required. The Agreement also requires 27 a liquidity guarantee, which is often in the form a letter of credit from the land owner which would cover debt service shortfalls . The land owner finances the improvements and is 30 reimbursed. 31 32 Mr . Thistle reviewed projects which are eligible for use of 33 these types of funds ; land acquisition, soil correction, site 34 preparation, relocation, demolition and public improvements 35 such as streets, sewers and pedestrian walkways . He is of the 36 opinion that this redevelopment project is a classic example 37 for use of tax increment funds in that it includes nearly all 38 of the aforementioned eligibility requirements . He feels this 39 is an excellent tool for the City to use in redeveloping a 40 dated shopping mall area . 41 42 Mayor Ranallo introduced Dennis Cavanaugh, President of the 43 C.G. Rein Company, which owns the Apache Ma11 . The Mayor noted 44 there have been several meetings between Mr. Cavanaugh and 45 members of the City Council and City Manager. 46 47 Mr . Cavanaugh, using an architect ' s rendering, addressed the 48 redevelopment project for Apache Mall complex . There will be 49 36 , 000 square feet of tenant space relocated in the mall . 50 Currently, there is 105, 000 square feet vacant .