Minutes - Council Work Session - 08/12/2003

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Finance Officer Lund replied that language would have to be included in the development agreement. Councilmember Zimmerman stated that Sunwood Drive was only one small piece of the project. At this point they have not seen the County or the State contributing any funds. There are still outstanding issues such as who is going to pay for the parking ramps, water towers, etc. He felt that the City needed to bring in an outside source looking at all of the expenditures and to see if the money generated will eventually come out to pay back those costs. Mayor Gamec replied that is why they are looking at completing certain improvement projects in phases. Councilmember Strommen inquired as to where staff was with bringing in an additional attorney to assist in the negotiation process. City Administrator Norman explained that staff has selected an additional attorney. City Attorney Goodrich stated they need to make sure their numbers are correct with the projections. Councilmember Cook stated that he would like to see some good qualified people to move the negotiations forward and bring forward a more solid development agreement for the Council to work with. Mayor Gamec replied that the Council has to be able to provide staff direction as to what they would like to see in the agreement. City Attorney Goodrich explained that the City is proposing to issue General Obligation Improvement Bonds pursuant to the statutory authority set forth in Minnesota Statutes, Section 459.14, to finance the construction of the public parking facilities. The bonds would be payable over a term of 20 to 25 years and would be payable from special assessment and citywide property tax levies. The City will specially assess 50 percent of the cost of the parking facilities against benefited properties. The "benefited properties" will be determined in accordance with State law and the mutual agreement of the City and the developer and will be identified in the development agreement. The developer must deliver a letter of credit in the amount of the special assessments. As certificates of occupancy are issued for buildings that are constructed on the parcels subject to the special assessments, the letter of credit may be reduced by an amount equal to the amount of the special assessments levied against that parcel. The bonds would be issued and construction of the ramps could commence when the developer has delivered (i) the letter of credit; (ii) purchase commitments to sell property; (iii) evidence that the purchaser have financing to construct the improvements that would rely on the ramp for parking; and (iv) conveyed the City the land on which the parking ramps will be constructed. It was again noted that an agreement has not yet been reached with the developer on the issue. City Council Work Session/August 12, 2003 Page 6 of 11