04-20-09-WS - Laserfiche WebLink

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ARDEN HILLS CITY COUNCIL WORK SESSION-APRIL 20, 2009 3 Community Development Director Lehnhoff noted that properties within an HIA had to have a petition signed by 25% of the homeowners. He indicated that a public hearing would need to be held if this were to proceed with a development and that the financing could be bonded or completed with City funds. Community Development Director Lehnhoff explained that the specific idea before the Council tonight was regarding the Arden Hills North Homes Association, which was a 140 townhome association. He stated a letter was included from the association indicating why they were exploring this option. Community Development Director Lehnhoff indicated that the Council did not need to vote on this item but rather provide feedback on this issue and if it has merit to proceed. He stated the research he has completed thus far there is little risk to the City but would allow the association to re-side their units while paying back the expense over a longer period of time. Community Development Director Lehnhoff explained he received a question from the Mayor asking why HIA's have not been used in the past. He reviewed a handout with the Council stating how NIA's have been used. Councilmember Holmes questioned how the City would not be liable if the loan were not repaid. Stacie Kvilvang, Ehlers & Associates stated the loan would be paid back as it was built into the structure of the financing, within the special assessments. Councilmember McClung asked that the risk to the City be further explained, even though it was projected to be small. Finance Director Iverson explained the risk to the City would increase if the townhome units were to become vacant and the taxes and assessments would become delinquent. Discussion ensued regarding the financing structure of the HIA loans. Councilmember Holden questioned why a homeowner would pursue an HIA loan over a home equity loan. - Finance Director Iverson stated home equity loans were an option for homeowners to avoid paying a special assessment over several years.