Fiscal Note
This resolution would authorize a $1,898,000 loan to 1102 South Park Street, LLC ("Developer") for the redevelopment of a portion of the former Bancroft Dairy property located at the intersection of Fish Hatchery Road and South Park Street. The redevelopment consists of an approximately 76,800 SF medical and commercial office building to be leased by the UW Health for the UW Health Wingra Family Medical Clinic and other commercial tenants and 305 parking stalls ("Project"). This loan would be repaid through incremental taxes generated by the Project and represents approximately 56% of the present value of all incremental taxes anticipated from the Project throughout the 27-year life of proposed TID #42 to be created in 2012. The TIF Loan would be disbursed to Developer from the General Fund in advance of TID base value certification being provided by the Wisconsin Department of Revenue, anticipated in the first quarter of 2013. In the event that the TID #42 base value is not certified by DOR, the Developer shall be obligated to repay the $1,898,000 of funds disbursed in advance by the City as a conventional loan, amortized over ten years, together with interest on the unpaid principal balance at the rate of the City investment fund yield calculated at the time of repayment, plus one hundred basis points. Payments of principal and interest shall be made quarterly.
Funds to capitalize this loan were authorized in the 2012 Capital Budget, funded with general obligation debt. While it is anticipated that the incremental taxes generated by the Project will be sufficient to repay the loan within approximately 8 years, the Developer is required to guarantee a minimum payment if sufficient future tax increment is not available.
The Developer is also obligated to return an equity participation payment equal to either Seven and sixty-five hundredths percent (7.65%) of the gross selling price of the Property, including improvements thereon, on the day of sal...
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