pf_01877 - Laserfiche WebLink

Home

• DATE: TO: FROM: SUBJECT: Since the previous memo was developed, I have had the opportunity to meet with Steve Wilson from the Brutger Companies. Based on the discussion that I had with Steve, I believe I have figured out a better way to accomplish this deal from the city''s perspective. The deal would flow as follows: 1. Brutger buys the land for 3.6 million dollars. Brutger is considering town houses, single family, and multi -family on this site. Tenetatively, the deal includes 25 town homes, 25 single family, and 200` multi -family. 2. The city would establish a tax increment district in the area, and purchase a 10 acre recreation site for 2.3 million dollars. (This would be accomplished through a tax increment write -down). The City would then use the income stream which appears to be $350,000 per year to retire the bonds. A $2.7 million 15 year bond at 7.5% would require $290,000 per year in debt service. The advantage in this deal versus the one discussed in the previous memo, is that the 1 million dollar burden that was placed on the city to sell the land for development, is removed as Brutger will have already accomplished this task. Therefore, the bond issue does not have to be sized in the 3.6 million dollar range. If it should be decided this is a reasonable approach to take, I would suggest the following action: 1. A development agreement should be negotiated with Brutger that spells out the specifics of the deal, ensures the fact that the development will proceed as approved, and supports the utilization of an assessment agreement and a letter of credit to provide the city protection if the development doesn't proceed according to the proposed plans. 2. This parcel should be added to the new tax increment district #10 that will be considered in July. 3. Brutger develops required planning application, etc.