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City Council Regular Meeting Minutes April 8, 2008 Page 4 VI. GENERAL BUSINESS OF COUNCIL. A. Resolution 08-028; Relating to the Seventh Amendment to a RcdevelopmenC Apreement by and among the City of St. Anthony, the Housing and Redevelopment Authority of the City of St. Anthony and id Apache Redevelopment, LLC, dated December 19, 2003. 8 Stacie Kvilvang, Ishlers & Associates, stated at the February 5, 2008, Council work session, the 9 Council heard a proposal to change the Phase 1B housing component from 128 condominiums 10 (for sale) to 100 Cooperative Senior Units (for sale). She explained that the units will no longer I 1 be condominiums resulting in a difference in the way they are valued and based on the Council's 12 discussion, the Council requested staff prepare a list of pros and cons of allowing this to move 13 forward and also to look at what would have to be changed in the Development Agreement. 14 15 Mayor Faust stated with the changes in the marketplace, the City has to remain flexible. He 16 stated lie felt with the current condominium saturation in the metro area, cooperative -type 17 housing appears to be the best type of housing the City can provide, which is a sort of hybrid 18 between condominium and apartment living that allows people to participate while having a 19 lower cost of entry. He stated it is important to find a way to make this project viable and this 20 represents a good alternative. He noted the resolution authorizes the commencement of 21 negotiations to amend the Development Agreement, and one of the conditions states that the City 22 will not change anything in the Development Agreement until a threshold of 60% presales is 23 reached. He added it is important that the design remains consistent with the quality and 24 workmanship of the current project. 25 26 Councilmember Stille asked if the term "presale" is defined. 27 28 Ms. Kvilvang replied that presale is essentially a signed Purchase Agreement. 29 30 Councilmember Stille stated this project provides maintenance and the financing behind it 31 requires reserves for items such as a new roof or other general maintenance; these items are all 32 pre -established pursuant to the terms of the HUD program that the developer is using. He 33 indicated he was in favor of this approach and noted this also ties into the City's senior transition 34 goals by providing another option for seniors. 35 36 Councilmember Gray concurred and stated it is important for the City to remain flexible given 37 the current economy and housing market. 38 39 Councilmember Thuesen stated he was in favor of the proposal and felt it makes the 40 development even more attractive. 41 42 Councilmember Roth stated with a HUD loan in a cooperative environment, they are required to 43 hold 4% in reserves for maintenance, etc. He indicated it was his understanding that this reserve 44 money is held by a third party so that the cooperative cannot use the money for something not 45 approved by HUD. 46 2