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AR-DEN HILLS CITY COUNCIL—May 10, 2010 9 7.C. Sand Companies, Inc. Request for a Letter of Support for Housing Tax Credits with the r ; Minnesota Housing Finance Agency for up to $575,000 in Public Assistance as Proposed in the May 10, 2010, Memorandum (continued) City Planner Beekman stated there were no other changes to the letter. Mayor Harpstead asked hypothetically if the TIF allowed was $200,000 and the City chose to not purchase the tower, what the maximum obligation to the City would be. He stated the materials presented to the Council show an example that states: if TIF is received for $184,000 then the City would pay the gap of$391,000 under the current proposal. He asked if this was only in the presence of a tower transaction or if this is also a commitment to go beyond the City's but/for TIF obligation. Finance Director Iverson stated that the City has been running the Performa and they have been basing what they feel the project merits based on the Performa and they do not believe that this will go over 15 years. Right now TIF is $184,000 but they have not figured the tower into this amount. She clarified the City is offering a letter of support with a good faith commitment however the City is not legally responsible for this amount. This is something that would have to be worked out. Any other funds that SCI would get from sources such as Ramsey County could also be used to fill this gap. Councilmember Holden clarified that the letter of support is a good faith commitment from the City to provide the requested support if the Housing Tax Credits are approved. City Planner Beekman stated this is correct. The ultimate question for the City is if this is the financing gap that has been determined then either the City will decide to fill the gap, fill part of the gap, or not assist in filling the gap at all. This is a letter saying the City is willing to look at financing the gap. There are other financing options that are available as well and this is not a commitment. It will be based on the viability of the project and the City's interest in participating in this project. Councilmember Holmes asked if the City sent this letter to MHFA and told SCI that the City is willing to commit up to $540,000 and there is only $184,000 generated through TIF then the City will have a huge gap that they have no way to fill. She clarified that the letter may not be a commitment but it is good faith. City Planner Beekman stated there are other funding sources that could be looked at for this project such as Ramsey County. Finance Director Iverson clarified in order for Ramsey County to disperse their funds it does need to go through the City and would be counted as City support. Councilmember Holmes stated the City needs a bigger commitment from Ramsey County than $35,000 if this is what is expected to fill this gap.