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City Council Regular Meeting Minutes <br /> September 9, 2003 <br /> • Page 5 <br /> Councilmember Horst asked if the discussion was related to the commercial properties only. <br /> 2 Ms. Kvilvang stated that was correct. <br /> 3 <br /> 4 Councilmember Horst observed the developer also had risk in the first phase. He asked if there <br /> 5 was a possibility they would walk away. Ms. Kvilvang responded she did not think they would <br /> 6 walk away; however, she felt the risk was if something catastrophic would happen in the market. <br /> 7 <br /> 8 Councilmember Horst asked if the City had to buy the property and work with Fannie Mae <br /> 9 before this was done. Ms. Kvilvang responded that was not correct. She stated the developers <br /> 10 were asking the City to provide the general obligation pledge and noted collateral. <br /> 11 Councilmember Horst indicated he would have a comfort level if the City were not looking at <br /> 12 general obligation but rather some pool of money, like the water filtration fund, the City might <br /> 13 have available. <br /> 14 <br /> 15 Mayor Hodson stated he was comfortable with the proposal and thought the risks were minimal <br /> 16 for such a large project. He felt the team was strong financially and he was relaxed about the <br /> 17 team's requests. He added he did not want to assess small risks if they were not necessarily a <br /> 18 reality. <br /> 19 <br /> 20 Councilmember Faust stated he was 95% sure this was going to happen; however, he did not <br /> 21 want the City to "throw $2.7 million out there"without more information. <br /> 22 <br /> Mayor Hodson asked if it was a viable option to guarantee the loan with the water filtration fund. <br /> Ms. Kvilvang responded anything was possible. She added the team would be looking at other <br /> 25 options and funds with the City's finance director. She stated she understood Council wished <br /> 26 them to find other funding sources first and, if general obligation were necessary, more <br /> 27 exploration would be needed. <br /> 28 <br /> 29 Councilmember Thuesen stated he was relatively comfortable with the City coming forward <br /> 30 with the collateral. He indicated using the water filtration fund was a good option to consider, as <br /> 31 he was not excited about using general obligation. <br /> 32 <br /> 33 Councilmember Horst agreed, as his concern was the risk to the public. He added he would need <br /> 34 to feel pretty comfortable that there was little risk involved because he did not want to see the <br /> 35 taxpayer"on the hook." <br /> 36 <br /> 37 Councilmember Thuesen noted residents had asked if their taxes would be raised and he had <br /> 38 been saying"absolutely not." He wondered if the taxes could be raised with the use of general <br /> 39 obligation. <br /> 40 <br /> 41 Councilmember Thuesen stated he felt relatively confident the negative scenario would not <br /> 42 "come knocking"; however, he was looking for a friendly option to minimize risks to the <br /> 43 residents. <br /> 44 <br /> Councilmember Sparks asked Ms. Kvilvang if she could give an approximate risk to the <br /> 10 residents. Ms. Kvilvang responded she did not currently have those numbers. <br /> 47 <br />