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City Council Regular Meeting Minutes March 23, 2021 Page 5 b. Must commence construction by July 31, 2021 and be completed by July 31, 2023. 1 2 Declaration of Restrictive Covenants 3 a. The Developer will record a Declaration of Restrictive Covenants that will be in place for 4 15 years from date of Certificate of Occupancy that states: 5 (1) 7 units (5%) will be affordable to persons at or below 50% AMI and the units will be 6 mixed within studio or 1-bedroom independent living or assisted living; 7 (2) Rental rates are based upon the rents (inclusive of utilities) set by HUD on an annual 8 basis; 9 (3) Developer will annually report meeting the affordability requirement to the City; 10 (4) Developer has to reimburse the City annually for its costs related to review of 11 compliance with the affordability restrictions; and 12 (5) TIF payments can be withheld in any given year if the Developer is not in compliance 13 with the affordability requirements. 14 b. Developer can’t transfer ownership of property without the Written consent of the City or 15 HRA, which will not be reasonable withheld. 16 17 Minimum Assessment Agreement (MAA) 18 a. Developer is required to file a MAA with the County which will be in place through the 19 term of the TIF Note as follows: 20 (1) Value as of January 2, 2022 shall not be less than $10,800,000. 21 (2) Value as of January 2, 2023 shall not be less than $21,600,000. 22 23 Tax Increment 24 a. The City is creating the Lowry Grove TIF District on March 23, 2021. 25 b. The Developer will receive a pay-as-you-go note in the amount of $2,350,000 after 26 providing proof of expenditures for qualified costs. 27 (1) Qualified costs are as follows: 28 Demolition $63,610 29 Site Utilities $2,155,193 30 Roads & Walks (City Extension) $61,709 31 Soil correction $137,740 32 TOTAL $2,418,252 33 34 (2) Term of the TIF Note will be for 9 years 35 (3) Interest will be paid at the lesser of 4% or their actual financing rate. 36 (4) Developer will receive 90% of the tax increment generated from their 37 project. 38 c. The Note will not be issued if there is an event of default and will only be issued after 39 receipt of a certificate of occupancy and the Declaration of Restrictive Covenants has 40 been recorded. 41 d. The developer has to inform the City/HRA if they petition for a reduction in their tax 42 value. If this occurs, the City/HRA will only pay out at the MAA amount until the 43 petition is stipulated or dismissed. 44 45 Ms. Kvilvang reviewed the Agreement in detail. 46 5