Fiscal Note
This resolution authorizes a loan from the City of Madison to the Community Development Authority of the City of Madison. Funds will be used to pay off existing bank loans for Revival Ridge and Monona Shores properties and fund major capital improvements at Revival Ridge. This loan will be executed via a promissory note issued by the CDA, purchased by the City, and held in the City's investment portfolio. The City’s investment policy allows for investment grade obligations of state and local governments and public authorities. The promissory note will include security features, such as assignment of mortgage. The loan will be in the amount of $5,691,636.97 with a term of seven years and interest rate of 4.1% resulting in semi-annual principal and interest payments of $471,821.28. The interest rate is based on the City's current portfolio yield plus 0.50%. This rate is approximately 2% less than current bank loan rates. This loan is similar to an approach used several years ago to advance surplus funds from Tax Increment District (TID 25) to Madison Metropolitan School District prior to the closure of that TID.
Title
SUBSTITUTE: Authorizing the City to issue loans not to exceed $5,691,636.97 to the Community Development Authority related to the Monona Shores Apartments and Revival Ridge Apartments.
Body
Editor's Note: The file was introduced By Title Only. The substitute modifies the title as follows:
Title: Authorizing the City to purchase a Taxable General Obligation Promissory note issued by issue loans not to exceed $5,691,636.97 to the Community Development Authority of the City of Madison related to the Monona Shores Apartments and Revival Ridge Apartments.
WHEREAS, the Community Development Authority of the City of Madison (“CDA”) owns and manages the property located generally at 2 Waunona Woods Court, Madison, Wisconsin, operated as affordable residential housing, and commonly referred to as the “Monona Shores Apartments.”
WHER...
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