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Agenda 3 HRA Meeting Minutes Tuesday, January 20, 2015 Page 10 1 Ms. Kelsey cautioned that, if they granted this request of the GMHC, which was ultimately up 2 to the HRA and City Council, staff had some concerns that other developers would not respond 3 if they felt they couldnt get a fair opportunity to compete with their proposals. 4 5 At the request of Member Wall, Ms. Kelsey addressed the current strength of the development 6 market going forward, based on consultation with area realtors, and new construction starts 7 occurring in Roseville. Ms. Kelsey expressed her confidence that another developer could 8 accomplish a similar project to that proposed by GMHC and move it forward. Ms. Kelsey 9 advised that she had delayed consulting with other developers until any relationship with 10 GMHC had been severed to ensure their fair treatment. 11 12 Community Development Director Paul Bilotta 13 At the request of Member Wall, Mr. Bilotta concurred with Ms. Kelsey that staff had wanted 14 to avoid any perceived negotiation with other developers while the GMHC proposal was still 15 out there. Mr. Bilotta advised that he was aware of at least one development proposal in the 16 last six months that was similar to this (former Owasso School District site), which may 17 indicate how the market would respond based on responses received by the school district. 18 Mr. Bilotta supported staffs desire to avoid discussions with local developers until the HRA 19 and City Council provided their decision. 20 21 Member Wall advised that hed feel more comfortable if other developers were primed before 22 terminating the contract and possibly sullying the reputation of GMHC in the development 23 community. 24 25 Ms. Olson noted that GMHC was initially the only one responding to the HRAs original RFP. 26 27 Mr. Bilotta noted, as stated by the GMHC, that they would like to continue being part of the 28 process if the HRA and City Council so deemed; which could be considered as an extension of 29 the PDA, but requiring timely completion. Mr. Bilotta stated that GMHC was still sitting at 30 the table tonight, without benefit of a contractual or legal PDA in place. 31 32 Ms. Olson noted that GMHC continued in good faith to make this project move forward. 33 34 At the request of Member Masche, Ms. Fleming advised that if the PDA was terminated and 35 GMHC forbidden to participate in a new RFP process, Western Bank would discontinue 36 working with GMHC since it would then become a futile effort on their part. 37 38 At the request of Member Masche, Ms. Kelsey clarified that it was at the discretion of the 39 HRA as to whether to allow GMHC to participate in a new RFP solicitation. 40 41 Discussion ensued regarding the interest of other developers; design of the site itself and types 42 of housing stock; and current sales of GMHC homes of various types supporting the projected 43 market price. 44 45 Member Lee, from her professional perspective, noted that the market for such a project is out 46 there, but questioned if there would continue to be financial questions or roadblocks from 47 another developer based on the HRA and City Councils requirements; and asked if something 48 was being asked of banks that they were not comfortable complying with. 49 50 Mr. Bilotta responded that projects were financed in many different ways, whether for-profit or 51 non-profit developers, but with most for-profit developers having a significant equity layer 52 available to assist in their financing requirements. Mr. Bilotta noted that, with the GMHC 53 project financing, the main sticking point was based on equity, and if there was subsequent 54 non-performance, the City needed some ability to recapture its investment. Mr. Bilotta advised 55 that staff had presented that requirement to the previous lender, and suggested other options to