CCP 02-10-1992 - Laserfiche WebLink

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... - Minutes of the Arden Hills Regular Council Meeting, 12-30-91 Page 2 PUBLIC 0JMMENl'S Dick Petersen, 3322 Katie lane, expressed interest . relative to the proposed merger of Arden Hills and the city of Shoreview, He stated his opposition to the merger and requested Council comments on the proposal. Petersen advised he was an observer when the original corporate docrnnents of Arden Hills were drafted. Mayor Sather explained the fonner Mayor of Sh=eview had made the suggestion at a Shoreview Council meeting. He advised such a merger does not appear to be beneficial to the City of Arden Hills and Council1nembers have not expressed interest in discussing this matter. ~TIF Council was referred to the memorandum from the Clerk FINANCING ; Administrator dated 12-24-91 and attachments, relating to NORm RIIX:E the request for Tax In=ement Financing for the North APARIMENI'S Ridge Apartment complex development, Continental Development Corporation, Charles C=k, President of Continental Development Corporation, explained the project received PUD approval from Arden Hills in January 1990. He advised that the company aggressively searched for conventional financing for the project f= approxi1Tlately one year, without sucx::ess, and has now appliirl for HOD financing. C=k stated that HOD accepted the application in May of 1991 and issued their formal conditional cornmibnent on October 28, 1991, which is a smaller mortgage amount than initially anticipated. Cook advised there is no risk to the City under the TIF program and the City . assistance is provided on an annual basis, payable only if the project pays it's property taxes. He reviewed the proposal and discussed the handouts presented to Council1nembers relating to the feasibility of the project, the financial structure of the HOD insured mortgage and a cost estimate informational sheet. Counci11nember Mahowald questioned what percentage of occupancy is necessary to insure the feasibility of the project. Cook indicated the project requires approxinately 80 percent occupancy to "break even".. Council referred to the "Sources and Uses" sheet distributed by the developer and questioned how the "Builders and Sponsors Profit and Risk" line item is calculated. Cook advised the figure is estimated by HOD. Financial Consultant James Casserly explained that HOD only allows the amount calculated to be taken from the project, if this amount is initially put into the project. Casserly explained that HOD is nonnally comfortable that the market will support a project before granting approval for financing. He further stated there is no risk to the City and all docrnnentation could be designed with language to insure no risk to the city. . There was discussion relative to the feasibility of the project and why conventional financing is not available for the project.