3.4. SR 08-16-2010 - Laserfiche WebLink

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REQUEST FOR ACTION TO ITEM NUMBER Ma or & Ci Council 3,4, AGENDA SECTION MEETING DATE PREPARED BY Consent August 16, 2010 Catherine Mehelich, Director of Economic Develo ment ITEM DESCRIPTION REVIEWED By Resolution Authorizing Issuance of Multifamily Housing Lori ohnson, Ci Administrator Revenue Bond and the Subordinate Multifamily Housing REVIEWED BY Revenue Note for the Dove Tree Apartments Project ACTION REQUESTED Staff recommends City Council approval of the attached resolution that authorizes the issuance, sale and delivery of a Multifamily Housing Revenue Bonds in the aggregate principal amount of $4,000,000 as well as the Subordinate Multifamily Housing Revenue Note in the principal amount of $3,000,000 for the Dove Tree Apartments Project, 1105 Lions Park Drive, along with execution of related documents as authorized within the resolution. Staff is recommending this issuance based on the following: • Approximately $1,122,000 of rehabilitation funds will be dedicated to the project (approx. $16,500 per unit) • Issuance and other fees to be paid for by the applicant BACKGROUND/DISCUSSION The City Council recently held a public hearing and passed a resolution on June 28, 2010, which allowed the process to begin for Dominium Development and Acquisition, LLC, under the ownership of Elk River Leased Housing Associates III, Limited Partnership (the "Borrower") to secure a tax exempt housing revenue bond in an amount up to $7,000,000 from the City. These funds will be used as proceeds for the purchase of the existing 68-unit multifamily rental housing facility known as Dove Tree Apartments located at 1105 Lions Park Drive. The City's issuance of these housing revenue bonds will also enable the owner to receive housing tax credits which will be converted to project equity. Approval of the attached resolution will formally authorize the Mayor and City Administrator to execute the necessary documents for the issuance, sale, and delivery of the Bonds and Note. No programmatic changes have occurred from the June 28, 2010 meeting and the amount of the rehabilitation, rent restrictions, etc. regarding this program are the same as shown on the attached June 28, 2010 Council action. FINANCIAL IMPACT It is important to reiterate that there will be no impact to the City, since this request is for a revenue bond (conduit financing), with the City not having to pledge any considerations for its debt payment. In addition, Dominium has paid an initial $5,000 application fee. Consistent with the City's Conduit Bonding Policy, the City will also require one percent of the issuance amount of the bonds be paid at C:\Users\jmiller\AppData\Local\Microsoft\Windows\Temporary Internet Files\OLKE8DB\Action Requested 8 16 IO.doc