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ELK RIVER HOUSING AND REDEVELOPMENT AUTHORITY <br /> October 2, 1996 HRA Report 96-1 <br /> REPAYMENT SCHEDULE - KING AND MAIN <br /> Proposed Action <br /> Staff recommends adoption of the following motion: Move to approve King <br /> and Main loan repayment schedule as attached to this report. <br /> With approval of this action, the Finance Department will establish a <br /> repayment schedule with the HRA and these repayment amounts will be <br /> adopted in future HRA budgets. <br /> Overview <br /> The financing mechanism which was used by the HRA for the purchase of the <br /> King and Main properties was an internal borrowing from the city liquor <br /> store fund. The liquor store fund made a loan to the HRA in the amount of <br /> $401,482.48. In addition,the HRA spent $24,185.26 to complete the legal, <br /> • environmental, survey, and other closing expenses associated with the <br /> properties. <br /> It now appears likely that the city will continue to pursue the construction of <br /> a new liquor store, thereby necessitating the quick repayment of this <br /> obligation by the HRA. <br /> The HRA is being charged 6 percent interest on its loan from the liquor store <br /> fund, which is slightly less than the rate the fund would receive if it were <br /> being invested with other city funds. <br /> Primary Issues to Consider <br /> 0 What is the amortization schedule for repayment? <br /> 0 What is the effect on the HRA's cash balance and future budgets? <br /> Supporting Documents <br /> 0 Expenditure and loan repayment breakdown. <br /> 0 H' : . tatement of Financial Activity as of September 30, 1996. <br /> .41 ,42 •`/ <br /> • Paul T. Steinman, Director of Economic Development <br /> P.O. Box 490 • 13065 Orono Parkway • Elk River, MN 55330-1743 • (612) 441-7420 • Fax: (612)441-7425 <br /> Equal Opportunity Housing and Equal Opportunity Employment <br />