10/19/10 Special Meeting - Laserfiche WebLink

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Ms. Kvilvang answered about $400,000 and about 1.4 million is flexible for the City. Commissioner Ramsey asked on the existing TIF, what other things would be using those dollars for. HRA Executive Director Nelson stated that the funds from TIF District 1, 2 and 4 are pre -1990 legislative changes to tax increment financing law. Post -1990 districts are more committed to specific projects within the district. Commissioner Elvig sees T.I.F. dollars for reimbursing ourselves on park dedication but wants to get back to the idea of retail and repaying ourselves and what's missing is the HRA is not getting refunded on anything. Can we finance a plan back to ourselves? Ms. Kvilvang responded there are two issues: the City is the source of the financing for the loan of 1.3 million and the other source is financing the 1.8 development fees. The HRA is not bringing the dollars to the table. They are trying to structure to the larger financing plan for the COR as a whole and they are trying to set everything up as interfund loans so they have that ability to recapture those unrestricted TIF dollars down the road Ms. Kvilvang noted that the last one is $2 million dollars is the present value of the Tax Increment that's generated and there plan is to keep that longer so, they don't want to wait 20 years to pay that off that is why they did the split at 85/15 %. The HRA gets the first 15% and the remaining 85 %goes to Flaherty. Ms. Kvilvang explained that there are two things that happen with a minimum assessment agreement, if it's on for 22 million and the assessor says its worth 24 million that note will be paid off sooner. When the assessor assigns the value, it is done very conservatively. HRA Executive Director Nelson discussed TIF District 2 funds and funding planned for CIP projects that would be utilized towards this project. Ms. Kvilvang explained when they borrow the $3 million to the District they are charging an interest at a statutory maximum of 4% to the District, it's another mechanism to figure out how to get the dollars back and how can we eam a return on the dollars we borrowed. Commissioner Jeffrey is concerned about borrowing money from other TIF Districts and how many years will it take to pay it back. Ms. Kvilvang answered 20 to 26 years over the teen with exception of 1.3 million loan within 10 years. Development Manager Lazan responded in addition to the corporate guarantee of Flaherty Collins Construction we are including provisions for this note that apply to the TIF so if they fail to pay this note they stop getting those payments as cross defaulted. Housing and Redevelopment Authority / October 19, 2010 Page 4 of 6