2007-06-19_Minutes - Laserfiche WebLink

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Chair Majerus thanked Mr. Kysylyczyn for his comments and indicated that the HRA will move to seek better clarity on this issue. c.Discuss Housing Improvement Area - Westwood Village I Ms. Bennett explained that the City Council has extended the timeframe to consider the Housing Improvement Area for Westwood Village I at their June 11 meeting so that more information could be gathered. Ms. Bennett noted that Member Elkins, Mr. Stark and Sue Shea of Westwood Village I had met with representatives from Bremer Bank to discuss financing options. Mr. Stark explained that the City Council has concerns about extending their reserves for programming. Mr. Stark noted that a possible financing option was discussed with Bremer Bank in which the bank would provide capital to the city for the Housing Improvement Area (HIA) loan while the city would pledge its obligation to Bremer Bank to pay the debt service on the loan. That debt service would be paid by assessments levied against Westwood Village I. Mr. Stark noted that Roseville Finance Director Chris Miller preferred a private program specifically geared to homeowners associations that did not involve the city in any way. Mr. Stark advised that he was doubtful Bremer Bank offered such a program. In the absence of such a program, staff was willing to continue to discuss and pursue this option. Chair Majerus inquired about the potential for additional condominium and townhome associations to seek similar funding. Mr. Stark indicated that there have been discussions with City Manager Bill Malinen and Finance Director Chris Miller about creating eligibility criteria such as an age threshold for condominium and townhome complexes that might seek similar funding in the future. Mr. Stark noted that he and Finance Director Chris Miller have also discussed the concept of arbitrage which would allow the city to charge a higher interest rate to the association to cover some of the city’s administrative costs involved with the loan. Chair Majerus inquired as to the timeline of this process. Member Elkins replied that the next step would be to meet again with Bremer Bank and include Finance Director Chris Miller in the discussion. Member Maschka expressed his opinion that this was an ideal public/private financing solution for this situation. Mr. Stark also brought up the possibility of holding early payoffs in reserve to further reduce the city’s exposure to risk. Member Kelsey inquired as to the possibility of other banks providing this type of loan. Mr. Stark advised that if the city pursued this option, it would most likely open this up to all banks and lending institutions in a competitive bid situation. Member Kelsey opined that discussions should continue with banks in the private sector to ensure that all private financing avenues have been exhausted. Chair Majerus asked that Finance Director Chris Miller continue to explore the public/private financing solution and that an update be provided to the board at its June 17 meeting. Westwood Village I resident Sue Shea spoke before the board to address the difficulty Westwood Village I has encountered in securing private financing due to the lack of long term loans available to the association. Ms. Shea advised that private short term loans are prohibitive to many Westwood Village I residents because they cannot afford the higher payment schedule. Ms. Shea also addressed the concerns expressed by members of the board that residents are fully aware of the repayment schedule (yes). Ms. Shea indicated that 85% of Westwood Village I residents support seeking HIA funding. Ms. Shea expressed her eagerness to partner with the city to facilitate a loan to make necessary and critical improvements to Westwood Village I. Member Kelsey advised Ms. Shea that the City Council, not the HRA, has final approval in this matter. Ms. Shea acknowledged her understanding of the approval process but pointed out the