HRA Minutes 01-26-1995
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MINUTES
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
SPECIAL MEETING, Thursday, January 26, 1995 - 7:00 p.m.
City Hall
MEMBERS PRESENT:
Vice Chairperson Ben Smith, Everette Ellison,
and Tom St. Hilaire.
MEMBERS ABSENT:
Chairperson Al Larson and Brad Barger.
STAFF PRESENT:
Jeff O'Neill and Ollie Koropchak.
STAFF ABSENT:
Rick Wolfsteller.
GUEST:
Dan Lindl, Presbyterian Homes.
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Vice Chairperson Smith called the special HRA meeting to order
at 7:00 p.m.
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C O!i~ IDE RA T.IO ~....1'_q_~ AP P RO VE MO D I FIe I AT I 0 RLQ.f-.-1' H E _~g.QQ.E,:J'~_gf__J'Ji~_
TIF PLA!i~~~bATIN5LTO_,[I.Ll?)STRICT NO. _J_-1~~__
Mr. Dan Lindl introduced himself, informed HRA members he was
employed by Presbyterian Homes, and explained his affiliation
with the Monticello Senior Housing Alliance, Inc. Mr. Lindl
was asked to help with structuring the project because of his
previous affiliation with B.R.W. Elness Architects and he is
not in it for the money. It was his initial understanding
that the Hospi tal District was going to donate the
approximately 3 acrss of land, which is currently being
appraised by the Alliance or Hospital. He felt the site was
a good location as it relates to hospital services; however,
a negative location as it relates to the close proximity to
the treatment plant.
Mr. Lindl reported the project is highly leveraged and no more
Ulan 2~; of the bond proceeds can be used for soft costs.
Units should rent for no more than 90 cents per square foot
and the end product should have a minimum property tax of less
than $10.00 per uni t. Groundbreaking was anticipated for
March in hopes of securing a low interest rate for the bonds.
The project must meet the requirements of 50% of the units are
occupied by residents with incomes of 80% or less of the area
median income, 20% of the uni ts are occupied by residents
whose incomes do not exceed 50% of the area median income or
40/60, and the maximum rent fat' these units must be 30% of the
area median income level to quality for tax credits and a
"Qualified Housing District".
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ERA tvUNUTES
JANUARY 26, 1995
Koropchak reiterated the reference and background information
provided in the agenda relating to the senior housing project
and the TIF budget. The proposed budget of $406,000 is
recommended for approval by Attorney Bubul in order for the
project to cashflow.
Jeff O'Neill reflected concerns raised by the city staff
regarding the proposed project: First, not a good location as
it relates to the close proximity to the Waste Water Treatment
Plant; secondly, no HRA, City Councilor staff member was on
the initial search committee for site selection; thirdly, the
Hospi tal Board purcha::.:;ed the two properties and now the
perception is the HRAjCity is to bail them out; fourth, the
HRA/City was sucked into the project; and fifth, the City has
a big interest in the established land appraisal because of
the Ci ty I s potential interest to purchase property wi thin Ull~
immediate area.
With the use of TIF for land acquisition, Tom St. Hilaire sees
the taxpayers money being shifted to or within the Hospital
District. Additionally, the Hospital District will benefit
through revenues generated from the services provided for the
operation and management of the senior housing. Previously,
St. Hiliare gave support to the project if it were privately
develuped, owned and managed.
HRA members supported the senior housing project concept and
its need within the co~nunity. However, they agreed that the
HRA was not involved in a site search, not informed of the
project details, mislead as to the equi ty provided by the
Hospital (land donation to a dollar donation), and now the HRA
becomes the entity to halting or slowing down the project.
The HRA asked, "What will it take to keep the project alive?"
Mr. Lindl reported the project won't work with rental rates at
$1.15 per square foot. To enhanc~ a better cash flow the
sources of funding might be revenue bonds issued by the city,
guaranteed loan by the HRA for a 1/2% point reduction, and
land donated by the hospital.
Everette Ellison made a motion to redffi:t"m the TIF budget of
$210,830 (NPV @ 8%) as approved on January 11, 1995, with the
addition of $10,000 for firetruck path/hydrants; recommended
the Hospital donate the land; recommended the Alliance
research other entities for a low or interest-free loan, and
gave support of a loan which would increase the cashflow
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HRA MINUTES
JANUARY 26, 1995
of the project. Tom St. Hilaire seconded the motion and with
no further discussion, the motion passed 3-0. Yeas: Everette
Ellison, Tom St. Hilaire, and Ben Smith. Nays: Nune.
3. CONSIDERATION TO REVIEW FOR APPROVAL AN~,,_. EQUAL
DISBURSEMEflT IPAYBACK AGREEMENT BETWEEN THE liRA, HOSPIT~h AJiR..
ALLIANCE.
Koro];)chak informed HRA members that the Loan Agreement of
January 11, 1995, between the HRA and the AlliancG did not
illC I ude an equal disbul'sement or payback p.t'ov ision. The ERA
IS now asked to consider approval of an equal
disburc::;ement/payback agreement.
Because the Loan Agreement of January 11, 1995 was subject to
an equal disbursement and payback clause or provision and with
the financial funding for sEnior housing project uncertain,
Tom St. Hilaire made a motion to deny approval of an Equal
Disbursement and Payback Agreement. Everette Ellison seconded
the motion and with no further discussion, the motion passed
3-0. Yeas: Tom St. Hilaire, Everette Ellison, and Ben Smith.
Nays: None.
Upon donation of the land by the Hospital and approval of
project financing, the HRAwill consider approval of the equal
disbursement and payback agreement.
4.
OTHER BUSINESS.
Everette
February
Ellison reported he
10 through March 20.
out-of-town
il'om
would
be
5. ADJOURNMENT.
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The HRA meeting adjourned at 8:35 p.m.
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Ollie Koropchak, HRA Executive Director
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