12-18-2007 Special City Council Minutes

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City Council Minutes December 18, 2007 Page 5 of 6 ------------------------------- COUNCIL MEMBER RYAN MOVED TO APPROVE THE CHECK REGISTERS AS PRESENTED FOR PAYMENT OF BILLS. COUNCIL MEMBER ORASKOVICH SECONDED THE MOTION. MOTION CARRIED 5-0. 8.1. Resolution Recoqnizinq An Obligation to Business The City Clerk reviewed a memo from its financial consultants, Ehlers, explaining the following: On August 7, 2007, the City Created TIF District 1-13 for the purpose of assisting Lonesome Cottage Furniture with the purchase of 4 lots in the City's Business Park. The City had asked and received $30,000 an acre for the lots in the Business Park, as evidenced in the sale of Lot 3, Block 1 on August 29, 2007. The 4 lots purchased by Lonesome Cottage had a market value of$209,400. The developer paid the City $46,000 in cash and has signed a note for an additional $100,000 to be paid over time. The City, in the approved TIF Plan anticipated being reimbursed for the $63,400 difference through tax increments generated by TIF District 1-13. On August 7, 2007, the Council passed a "Resolution Authorizing an Interfund Loan for Advance of Certain Costs in connection with Tax Increment Financing District No. 1-13 up to $84,900 from the Business Park Fund to allow for the repayment of the write-down of the cost of the land. i The Clerk distributed the resolution recognizing this obligation to the City and noted that this resolution has been drafted by the City bond consultant, Briggs and Morgan. Council Member Ryan indicated that he would like more information on this issue before voting. The Clerk noted that the City would not receive any of the $63,400 until Lonesome Cottage has been paid the required amount of money from TIF as stated in the TIF Agreement. If the Council decides at a later date that it does not want to pay the $63,400 back to the City, it can decertify the district after full payment has been made to Lonesome Cottage. COUNCIL MEMBER RYAN MOVED TO TABLE THE REQUEST UNTIL MORE INFORMATION COULD BE PROVIDED. The motion died for lack of a second.