5.0. HRSR 05-03-2004 - Laserfiche WebLink

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APR. 30. 2004 9:40AM METRO. PLAINS NO. 167 P. 3 The note(s)for the Jackson project will be issued when the construction financing for the 110 Bluff project closes and after the building permit for Bluff project is issued. The Development Agreement will contain a"look back"method for both the Bluff and Jackson projects. With regard to the look back provision for the for-sale residential portion of the Bluff Project, MetroPlains understands that it will be allowed a specific amount of profit tied to a percentage of the total cost of acquiring and constructing the for-sale portion of the Bluff Project. If after the sale of all of the units MetroPlains' profit exceeds the allowed profit, the HRA's assistance for that portion of the project will be reduced. On the rental housing and commercial portion of the Jackson and Bluff projects MetroPlains will be allowed development fees and a return on equity based on a preliminary sources and uses statement. To the extent that final costs are less than those shown in the preliminary sources and uses statement increasing MetroPlains' return,the assistance for that portion of the project will be reduced. The amount of profit, return and fees that the amount of tax increment financing will be based on and the "look back"method will be based on is as follows: Bluff Block For-sale housing-10% of costs Commercial-5% development fee, market rate leasing commissions and a 12%cash on cash rate of return Jackson Block Rental Housing-12% developer fee based on costs approved by MHFA Commercial-5% development fee, market rate leasing commissions and a 12% cash on cash rate of return The Development Agreement will provide that any reduction of the assistance for one of the phases of the project will be offset by verifiable increased costs on other phases, 3. SAC/WAC/Park Dedication/Building Permit Fees. The City is willing to reduce or waive in their entirety the SAC and WAC fees, if necessary,to make the projects feasible. MetroPlains acknowledges that the City's utility commission must approve these reductions or waivers. The City will not reduce park dedication fees, building permit fees or other applicable City application and development fees that are payable in connection with the projects. MetroPlains is not in a position to bear the tax increment inflation risk. MetroPlains agrees that the City can recapture these amounts from tax increments derived from inflation. The City will recommend to the Park and Recreation Board that the park dedication fees are used for park, boardwalk, gazebo relocation and other improvements related to the downtown redevelopment. • 2 1643076v1