HRA Minutes 09-29-1992
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MINUTES
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
Tuesday, September 29, 1992 ~ 6:45 PM
City Hall
MEMBERS PRESENT:
Chairperson Al Larson, Ben Smith, Lowell
Schrupp, and Everette Ellison.
MEMBER ABSENT:
Tom St. Hilaire.
STAFF PRESENT:
Ollie Koropchak.
STAFF ABSENT:
Rick Wolfsteller and Jeff O'Neill.
1. CALL TO ORDER.
Chairperson Al Larson called the HRA meeting to order at 6:45
PM.
2.
CONSIDERATION TO REVIEW FOR AMENDMENT THE PRIVATE
REDEVELOPMENT CONTRACT BETWEEN JERALD J. AND MARY E. SCHOEN
AND THE HRA.
Upon the request of the redeveloper, the HRA members were
asked to review the executed Private Redevelopment Contract
between Jerald J. and Mary E. Schoen and the HRA for possible
amendm(~n t .
Koropchak presented HRA members with a copy of the August 5
HRA minutes recording the HRA's acceptance of the said final
draft of the Private Redevelopment Contract between the
Schoens and the HRA. Secondly, the HRA received an updated
Aroplax project cost to the City of Monticello through August
15, 1992. Total charges from Business Development Services,
Holmes & Graven, and Paul Weingarden were $19,966.44.
Next, the HRA received a copy of the requ.ested contract
amendments as provided by Mark Tebelius, Mr. Schoen's
attorney. Those being: One, elimination of the $21,500
Letter of Credi t or request to provide only through 1996;
second, amendment of the minimum improvements completion date
from January 2, 1993 to February 28, 1993; and thirdly,
various amendments to delete the minimum improvements
insurance, see Section 5.1.
Koropchak informed the HRA that the executed contract states
the Letter of Credit is reviewed annually for renewal by the
HRA for the duration of the TIF district. The January
completion date coincides with the TI Guarantee Acticle and
establishes contract defaul t. Next, the insurance section
requires proof of insurance and proof of payment, and in the
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HRA MINUTES
SEPTEMBER 29, 1992
PAGE 2
event the minimum improvements are destroyed the HRA would
receive the insurance net proceeds for reconstruction. John
Dean, HRA Attorney, stated, "If this is a lender's requirement
than the HRA could consider lender subordination in the event
of bank foreclosure but recommended no subordination to the
redeveloper'" Lastly, Koropchak reminded the HRA that the
$15,000 loan at 8% interest rate was initiated to recover part
of the HAC A lose; therefore, pre-payment rights should not be
granted because of the need for the principal and interest
payback.
Koropchak outlined the HRA's alternatives: One, do not amend;
second, amend all requests; third, amend a portion or portions
of the requests; or fourth, amend requests with a reduction of
TIF assistance. TIF District No. 1-12 will collect tax
increment over seven years.
After brief comments from each HRA member regarding the
concern of the lender's need for HRA subordination and the
risk of an economic development project not materializing, it
was the consensus of the HRA to stick with the original
executed Redevelopment Contract. Al Larson made a motion
reaffirming the accepted terms and conditions of the original
executed Private Redevelopment Contract between Jerald J. and
Mary E. Schoen and the HRA, executed August 24, 1992.
Everette Ell ison seconded the mot ion and wi thou t further
discussion the motion passed unanimously. The HRA felt the
City has been supportive of the Aroplax project and the HRA
believes in the deliverance and follow-though of a sealed-
executed document.
3.
OTHER BUSINESS.
The HRA agreed to invi ting wi th Mr. Bill Kemp to an HRA
meeting to inform members of new elderly housing development
financing and to extend an invitation to Barb Schwientek.
The HRA did not act on the tax forfeiture land document but
will review so at the next meeting.
4. ADJOURNMENT.
The HRA meeting adjourned at 7:20 PM.
U~ \<n~SJ~
Ollie Koropchak, HRA Executive Director