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<br />. <br /> <br />. <br /> <br />. <br /> <br />Minutes of the Arden Hills Council Worksession, 6-15-92 <br />Page 4 <br /> <br />TIF PROPOSAL, THE COTTAGES, JOHN ARK ELL <br /> <br />Council was referred to a letter from Financial Consultant <br />James Casserly, relating to the proposed low income Senior <br />Housing Project proposed by Cottage Lifestyles, Inc. and <br />John Arkell, and two development agreements for projects of <br />this nature constructed in other communities. <br /> <br />James Casserly reviewed the subsidy portion of his report <br />and indicated the proposal is feasible. He indicated the <br />following items of concern relating to the project: <br /> <br />1. Senior only project. The city must be assured that the <br />project will be maintained for this purpose; various <br />restrictions of covenants in the deed and in the <br />authorization for the issuance of bonds may be <br />required. Also, the pledge of tax increment and the <br />redevelopment contract may all be approved with <br />conditions and restrictions. <br />2. Quality Control. The construction cost per units is <br />35,000; these are modest per unit costs and the City <br />must assure itself that it will be authorizing a well <br />constructed unit. The city of North st. Paul was <br />positive about the Developer and only a few changes <br />were required in the construction plans. <br />3. Tax Increment Penalties. The 1990 amendments to the Tax <br />Increment Act penalizes cities when they create TIF <br />district by reducing LGA and HCA; Arden Hills does not <br />receive either one of these aids and therefore there <br />would be no deduction. <br />4. project Manager. The City has an interest in how the <br />project will be managed, since it will be a senior only <br />project; additional discussion with the Developer on <br />the qualifications of a project manager should be held. <br />5. Future project Use. If the project is well constructed <br />and well managed, the city is getting an attractive <br />asset which provides affordable housing for 15 to 20 <br />years to a segment of the population which needs <br />housing options. Part of the problem with using real <br />estate taxes to subsidize rents is that you continue to <br />need those real estate taxes for subsidy unless other <br />programs become available. It must be assumed that at <br />the end of the qualification periods the project <br />becomes a market rate project. <br />