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Agenda 3 HRA Meeting Minutes Tuesday, January 20, 2015 Page 9 1 GMHC, Ms. Fleming recommended that the HRA give them their requested extension for the 2 project. 3 4 At the request of Chair Maschka, Ms. Fleming advised that she had reviewed the appraisal 5 summary and, while having a few questions, she expressed confidence that the project could 6 move forward with financing by Western Bank even if it required revising the proposed 7 financing allotment. Ms. Fleming noted that, due to regulatory requirements through the 8 process, she could not speak directly to the appraisal outside the chain of command for 9 appraisal review, advising that she had to address her questions to the banks underwriting 10 department. 11 12 At the request of Member Wall, Ms. Fleming stated that, while the appraisers were not under 13 her direct supervision, the credit department was, and she felt confident that Western could 14 have their determination made within the next 2-3 weeks. 15 16 Directing his question to Ms. Olson, Member Majerus asked why GMHC had not come 17 forward to extend the PDA, knowing that it was scheduled to terminate June 30, 2014. 18 19 Ms. Olson opined that, from the perspective of GMHC as well as HRA staff, they continued to 20 be confident that financing was in place until the deadlock with U. S. Bank and staffs 21 suggestion to seek a local lending option. Ms. Olson noted that not pursuing the project and 22 the provisions of the PDA was not on anyones mind as everyone continued to work in good 23 faith addressing issues as they came up, with the only remaining issue that of getting all 24 financing in place. Ms. Olson noted that, even when GMHC had to start over to accomplish 25 that financing aspect, they were still under the impression that the project remained a go and 26 the HRA, City and GMHC would continue to work together on the project. 27 28 Since all developers go through cycles of cash flow, Member Masche asked if GMHC had 29 sufficient equity available to do the project; with Ms. Olson responding affirmatively. 30 31 In recognizing that the first attempts in financing with U. S. Bank had proven unacceptable to 32 the HRA, Member Masche asked if GMHC had understood staffs perspective. 33 34 Ms. Olson responded that GMHC understood that U. S. Banks requirement to hold a 35 mortgage on the property was not acceptable to staff, and what HRA staff was requiring as 36 security for the project was not acceptable to the bank. 37 38 Ms. Kelsey clarified that both the HRA and City Attorney were involved in the discussions and 39 conclusions and based on their recommendations, staff had advised that the terms of U. S. 40 Bank were not acceptable to the City as they removed the City from any rights to the land if 41 the developer was foreclosed upon; therefore making it unacceptable to have the City entirely 42 removed from the development. 43 44 45 Member Masche asked Ms. Fleming if Western Bank had experience working with non-profits 46 on this type of development, and particularly in working with GMHC. 47 48 Ms. Fleming responded that Western had worked with non-profits, not specifically GMHC; 49 but advised that she had worked with GMHC with her previous employer. 50 51 Ms. Olson respectfully asked, if GMHC is terminated or removed from the project at this 52 time, that the HRA allow them to apply under a new RFP again. 53