Fiscal Note
The proposed resolution authorizes forgiving approximately $479,527 of accrued interest payable to the City from Avalon Madison Harmony Housing LLC in exchange for executing a land use restriction agreement to create thirty-one (31) additional units of affordable housing at the Project until 2036 (the “Original Market Rate Units”). The accrued interest is from a $1,000,000 TIF loan from TID #29 - Allied Terrace for the construction of a 104-unit multifamily rental housing development known as Avalon Madison Village. The $1,000,000 in principal will still be payable to the City by October 5, 2022, allowing TID #29 to recover its project costs and ending 2022 with a positive cash balance. No additional City appropriation is required with approval of the proposed resolution.
Title
Authorizing the Forgiveness of Interest Accrued on a Loan to Avalon Madison Village for the Purpose of Creating Thirty-One Units of Affordable Housing.
Body
WHEREAS, in 2005, the City approved a tax incremental financing (TIF) loan to Gorman and Co. for One Million Dollars ($1,000,000), in the form of a deferred note with interest (the “Note”), for the development of Avalon Madison Village (the “Development”), as approved by RES 05-00086; and
WHEREAS, Avalon Madison Harmony Housing LLC (“Buyer”) entered into a Purchase and Sale Agreement for the purchase and sale of a 104-unit multifamily rental housing development known as Avalon Madison Village and located in the City of Madison, Dane County, Wisconsin (the "Project"), seventy-three units of which are restricted for affordable housing related to tax credit financing; and
WHEREAS, Buyer has requested that City forgive the accrued interest on the Note in the amount of $479,526.94 (“Accrued Interest”), but make payment of $1,000,000 of principal; and
WHEREAS, in exchange for the forgiveness of the Accrued Interest, Buyer shall executed a land use restriction agreement to create thirty-one (31) additional units of affordable...
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