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City Council Regular Meeting Minutes December 11, 2007 Page 4 1 Ms. Kvilvang stated this means the City is able to pay off its debt quickly. 2 3 Mayor Faust stated it puts the City in a good financial position. He stated that if there were a 4 situation to retrenchment, the City would be in a better position because of its debt. Ms. Kvilvang replied that was correct. 8 Motion by Councilmember Stille, seconded by Councilmember Gray, to Approve Resolution 07- 9 080; a Resolution Calling Bonds for Redemption. 10 11 Motion carried unanimously (5/0) 12 13 B. Resolution 07-081; Resolution Authorizing Extension of $3,350,000 Credit Facility from 14 Fannie Mae. 15 16 Ms. Stacie Kvilvang reported that on May 22, 2007, the City Council and Housing and 17 Redevelopment Authority approved a resolution extending the repayment agreement with Famrie 18 May for its $3,350,000 loan. She stated the resolution authorized the City Manager and City 19 Attorney to proceed with negotiating with Fannie Mae the terms of an extension of the loan to 20 August 27, 2009, and to prepare necessary documents for execution. She reported that of the 21 130 Pratt Home units built, over 100 have been sold. 22 23 Ms. Kvilvang reported the final agreement was approved by Fannie Mae on the extension of the 24 loan. She indicated that since the resolution the City originally approved had a two-year 25 extension date, Fannie Mae requested a new authorizing resolution based upon the terms. She 26 pointed out that, pursuant to the Development Agreement, the developer is responsible to make 27 all payments referenced in the terms. 28 29 Councilmember Gray inquired as to whether all the costs involved with this extension would be 30 born by the developer with no additional costs to the city. 31 32 Ms. Kvilvang replied that was correct. 33 34 Councilmember Stille stated this loan is backed by the general obligation of the city and secured 35 by the land upon which the condominiums would be built. IIe stated that if the construction did 36 not move forward as planned, the City would have control of the land. 37 38 Ms. Kvilvang replied that was correct. 39 40 Councilmember Stille stated the existing dept is approximately $2 million on the two building 41 sites, and after September 1, 2008, one of the sites would be released after the developer makes 42 payments. He stated there is acceleration built in to the schedule because of the principal 43 payment. 44 45 Ms. Kvilvang replied that was the correct thought process. 46