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F,� <br />DATE: <br />TO: <br />FROM: <br />SUBJECT: <br />June 8. 1988 <br />Jim Andre <br />Craig A. Waldron <br />Concordia School <br />The Concordia School project appears to ne moving Lai.L1Y A- LA._ <br />have had the opportunity to discuss the project with other staff <br />and with Steve Wilson of the Brutger Companies. Brutger has put <br />together a purchase option for this property, and is very <br />interested in proceeding with the project. The deal flow could <br />occur as follows: <br />1. Brutger buys the land for 3.6 million dollars. Brutger <br />is considering townhomes, single family, and multi- <br />family on this site. Tentatively the deal would <br />include 25 townhomes, 25 single family homes and 200 <br />multi -family units. The City would establish a tax <br />increment in this district and purchase a 10 acre <br />recreation site for approximate million dollars. <br />public <br />(It is critical that this be structuredas a <br />facility purchase on the part of the city <br />t nrorder that <br />if <br />this deal be accomplished at tax p <br />this were done as a pure land write down, this would be <br />defined as a private purpose bond, and thus rate). <br />e city <br />exempt ta <br />x e ) <br />would not be able to ut <br />ilize the p <br />2. The city would then use the income stream, which <br />tentatively appears to be in the range of $350,000 in <br />tax increment per year to retire the bo t e Ed d of <br />have preliminarily sized a bond in range <br />$3,300,000 which includes $400,000 for the recreation <br />center repair, capitalized interest, and bond issuance <br />expenses. For 15 years at a 7.5 interest rate, i the <br />ran <br />debt service is approximately $373,000 per yea <br />r. the tax increment projection at approximately 100 mils, <br />therefore, the debt service and actual increment should <br />be fairly close. <br />3. A development agreement would have to be negotiated <br />with Brutger that spells out the specifics of the <br />deal, ensures the fact that the development will <br />proceed as approved, and supports the utilization of a <br />letter of credit to provide the city protection if the <br />development doesn't proceed as according to plans. <br />4. This parcel should eventually be added to the new tax <br />increment district #10 that will be considered in July. <br />In addition to the other projects that are part of tax <br />increment district #10, this project makes the approval <br />