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Agenda 3 HRA Meeting Minutes Tuesday, January 20, 2015 Page 11 1 them, but basically once the deal was signed, under U. S. Banks requirements the property 2 would be gone and whatever happened would no longer be under any control by the City, 3 which was ultimately not considered to be in the best interest of the City or its residents and 4 taxpayers. Mr. Bilotta opined that the other proposals provided to the lender by staff would 5 have protected the lender as well as the City, but were not accepted by the lender. 6 7 Member Wall questioned if Mr. Bilotta concurred with HRA staffs recommendation to 8 terminate the GMHC contract. 9 10 Mr. Bilotta responded affirmatively, opining that something needed to occur, whether that was 11 to terminate or let GMHC resubmit an RFP, or not allow them to do so all policy decisions to 12 be made by the HRA. Mr. Bilotta stated that a line had to be drawn somewhere, and with 13 several interim deadlines having already expired, with staff having considered November 1, 14 2014 as the drop dead date in order to get something constructed in 2015, and to address 15 expiration of tax increment financing (TIF) Districts that may be compromised with further 16 delays. Mr. Bilotta noted that the City could not wait forever, and therefore staff was moving 17 from their preferred timeline for construction start backward to this point to get a project 18 underway. Mr. Bilotta noted the disappointment from staffs perspective that many 19 timeframes had approached their deadline before GMHC met that step and moved forward; 20 and from staffs perspective, it was now time to seek a policy decision from the HRA and City 21 Council on this project potential and completion. 22 23 Ms. Olson noted that GMHC had been working with Western Bank since September of 2014, 24 but had to move through many revisions during that process. 25 26 Member Lee recognized, from her experience, the complexities in a development process. 27 28 At the request of Chair Maschka, Ms. Olson reviewed the proposed staging of the project in 29 three phases, as supported by Western Bank, to facilitate financing over twenty-four months. 30 31 Bill Buelow, Director of Construction with GMHC 32 Mr. Buelow reviewed the specifics of the term sheet provided by Western Bank for the number 33 and phasing of single-family homes, row townhomes, and timing during that twenty-four 34 month period. 35 36 Ms. Olson opined that the project would move faster than that, since the demand was evident. 37 38 Mr. Buelow recognized the HRAs position and their frustrations with the timing of the 39 project, opining that GMHC representatives shared those frustrations. However, Mr. Buelow 40 opined that now that they were just a few weeks away from resolution with Western Bank, to 41 have the HRA terminate the project at this point seemed harsh, and asked that the HRA 42 continue to support the project. 43 44 Member Masche noted that GMHC had done development projects for decades that no one 45 else was willing to or could feasibly undertake. Given the requirements of the City to protect 46 their security interests, Member Masche asked if Western Bank was aware of those 47 requirements and was willing to meet those requirements; and whether that had been a road 48 block before or if it was a new issue for GMHC. 49 50 Ms. Olson clarified that Western Bank had a different agreement and was not asking for the 51 same security requirements as U. S. Bank. Ms. Olson referenced the Letter of Credit held by 52 GMHC with U. S. Bank and their continued use of that Letter for their projects with the Bank 53 always getting the mortgage for the site, but usually with sites scattered. However, Ms. Olson 54 noted that this project was different in that it was all happening on one site. 55