12-06-2004 HR MIN - Laserfiche WebLink

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Housing&Redevelopment Authority Page 2 December 6,2004 Ms.Mehelich indicated that MetroPlains has accepted the development agreement that was • drafted based on the key points identified by city staff,the HRA,and the City Council.Ms. Mehelich introduced Mary Ippel of Briggs and Morgan,the attorney who drafted the development agreement for the city.Ms.Ippel summarized the final agreement as follows as it relates to the key points identified. Linkage between the Jackson project and the Bluff project Ms. Ippel stated that the HRA and City Council have directed staff and the developer that the completion of both the Jackson and Bluff projects together are desired elements of the Downtown Revitalization Project.She also stated that the project meets the city's goals and objectives and that the development agreement provides for the City Council to formally approve the construction plans and parking plans prior to any construction.Ms.Ippel indicated that the development agreement includes several activities that must be completed by MetroPlains prior to any construction on the Jackson Block property,including MetroPlains'payment of the King Avenue parking lot improvement. Amount of Tax Increment Financing Assistance Ms.Ippel stated that the development agreement defines "Pledged Tax Increment"that the developer would receive up to 89% of the actual tax increment through a pay-as-you-go note for the purpose of reimbursing MetroPlains for TIF eligible costs.Ms. Ippel also stated that MetroPlains will receive 6%of the annual tax increment for the purpose of reimbursing the cost of the King Avenue parking lot and the city will receive the remaining 5%for reimbursement of administrative costs of the project.She noted that there is a"look back" procedure outlined in the agreement in order to ensure that the developer does not receive any more assistance (via TIF,SAC/WAC,and Jackson Land)than is necessary to make the project financially feasible.Ms.Ippel stated that in addition to the TIF,it is estimated that the city will be providing Jackson Land,SAC,and WAC as additional forms of assistance. SAC/WAC/Park Dedreation/BuildingPermit Fees Ms.Ippel indicated that the city is approving a reduction of the entire SAC and WAC fees in the development agreement.In return,the city will capture 100% of any annual inflation over the 25-year TIF district period and at 4%interest rate to reimburse itself for the SAC, WAC,and Jackson Land. She noted that the park dedication fee paid by the developer will be dedicated to park improvements in the downtown area. Cost of the Jackson Block Ms. Ippel stated that the development agreement identifies $500,000 as the estimated value of the Jackson Block property.She indicated that the property will be sold to MetroPlains for$1.00.She stated that the inflation that the city may capture over the life of the TIF district will reimburse the city for the Jackson land. Issuance of City Tax Increment Bonds Ms. Ippel stated that the development agreement outlines a number of conditions that would need to be met in order for the developer to request the city to issue tax increment bonds to refund the tax revenue note. Purchase of Bluff Block Properties Ms. Ippel explained that the sale of the Jackson Block property is conditioned,among other things,upon the developer having fee title to all of the Bluff Block property.The development agreement outlines the conditions and process that the city would undertake at • its own discretion and under limited circumstances for the acquisition of the Bluff Block property through the use of its powers of eminent domain.She noted that staff does not currently anticipate that this will be necessary.