Fiscal Note
The proposed resolution authorizes an agreement for Payment in Lieu of Taxes (PILOT) for the University Row Clinic development in the event the property becomes tax exempt. This resolution is an amendment to Council Adopted RES-11-00919 (File ID 24230), which authorized an $1,372,000 Tax Incremental Finance Loan to GI Clinic, LLC, which has been repaid. No additional City appropriation is required for this amendment.
Title
Amending Resolution 11-00919 regarding a TIF Loan to GI Clinic, LLC to authorize the execution of a PILOT Agreement. (District 19)
Body
WHEREAS, pursuant to Council approved RES-11-00919 (File 24230), as amended by RES-12-0752 (File 27556), GI Clinic, LLC (the “Developer”) and the City entered into the Tax Increment Financing Loan Agreement dated February 5, 2013 and recorded with the Office of the Register of Deeds of Dane County, Wisconsin on February 6, 2013 as Document No. 4958402 (the “TIF Loan Agreement”) wherein the City agreed to provide a loan of $1,372,000 to the Developer (the “TIF Loan”).
WHEREAS, the TIF Loan Agreement pertains to property located at 750 University Row and further described in Exhibit A to the TIF Loan Agreement (the “Property”).
WHEREAS, the Developer's obligations under the TIF Loan Agreement are secured by a Mortgage encumbering the Property and granted by the Developer to the City, dated February 5, 2013, and recorded with the Office of the Register of Deeds of Dane County, Wisconsin on February 6, 2013, as Document No. 4958403 (the "TIF Mortgage").
WHEREAS, the Developer will be conducting further development of the Property, which will involve subjecting the Property to a condominium form of ownership and constructing new improvements on the portion of the Property identified in the TIF Loan Agreement as Parcel B, which is currently used as a surface parking lot.
WHEREAS, Section 6 of the TIF Loan Agreement requires the Developer, prior to sale or transfer of Parcel B of the Property, to execute a note, mortgage, and payment in lieu of taxes (PILOT) agreement to secure the City’s right to collect PILOT payments in the event Parcel B becomes tax exempt prior to September 6, 2038. Section 7 of the TIF Loan Agreement provides that, if due, the amount of the PILOT payment shall equal the amount of the property tax last levied as of the date of conveyance and shall be paid through 2038.
WHEREAS, to allow the Developer proceed with the additional development of the Property, the City will need to execute a partial release of its existing TIF Mortgage releasing Parcel B.
NOW THEREFORE BE IT RESOLVED, that the Common Council authorizes the Mayor and Clerk to execute an agreement for a Payment in Lieu of Taxes (PILOT) regarding Parcel B of the Property. The PILOT Agreement shall provide that if the subject property becomes tax exempt, PILOT payments shall be due to the City in an amount equal to the property tax last levied as of the date of conveyance and shall be paid through 2038.
BE IT FURTHER RESOLVED, the Mayor and Clerk are authorized to execute and record other documents related to the transaction and development described herein including a partial release of the TIF Mortgage, any necessary documents related to easements on the Property, and consent by City as mortgagee to the condominium documents.
BE IT FINALLY RESOLVED, the Mayor and Clerk are authorized to execute and record documents, and take further actions necessary to carry out the purpose of this resolution in a form to be approved by the City Attorney.