Fiscal Note
This resolution authorizes the CDA to loan $2,100,000 to the Wisconsin Partnership for Housing Development, Inc. using the remaining balance of a previously authorized $4,100,000 variable rate Fannie Mae line of credit as the financing source. Under the terms of the letter of credit, which expires on December 15, 2007, the CDA makes quarterly payments at an interest rate equal to the 90 day LIBOR (London Inter-Bank Offered Rate) index plus .9%. This rate is currently estimated at approximately 6.4%, but will be set at closing and adjusted quarterly.
The proposed loan to Wisconsin Partnership for Housing Development would require payments to the CDA at an interest rate that is 1% higher than the Fannie Mae rate.
The City has guaranteed repayment to Fannie Mae should the CDA be unable to fulfill its quarterly payment obligation. This guarantee constitutes a general obligation debt of the City.
Title
Approving the CDA's borrowing of $2,100,000 from Fannie Mae in order to loan the proceeds to the Wisconsin Partnership for Housing Development, Inc., for the purpose of constructing affordable condominium units in the Twin Oaks neighborhood.
Body
WHEREAS, the CDA and Fannie Mae entered into a Loan and Security Agreement under which the CDA may borrow up to $4,100,000 (the "Credit Facility") from Fannie Mae to finance residential construction or rehabilitation projects; and
WHEREAS, by Substitute Resolution No. 59816, ID No. 32979, adopted on October 1, 2002 (the "Authorizing Resolution"), the City agreed to guarantee repayment of the Credit Facility through a pledge of its full faith and credit and taxing power; and
WHEREAS, the Authorizing Resolution provided that any final borrowing by the CDA must be approved by the Common Council; and
WHEREAS, a Request for Proposals (RFP) was released on April 17, 2006, with proposals due on May 17, 2006; and
WHEREAS, the Wisconsin Partnership for Housing Development was sole respondent...
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