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File #: 26844    Version: 1 Name: 9897 University Crossing Phase II TIF Loan Reso
Type: Resolution Status: Passed
File created: 6/22/2012 In control: BOARD OF ESTIMATES (ended 4/2017)
On agenda: 7/17/2012 Final action: 7/17/2012
Enactment date: 7/23/2012 Enactment #: RES-12-00540
Title: Authorizing the Mayor and City Clerk to execute development agreements to fund: 1) a $2,019,000 Tax Incremental Finance (TIF) Loan to University Row Apartments, LLC to assist in the development of a 118-unit apartment building and 335-stall parking structure, and 2) a $1,087,000 TIF Loan to University Crossing Office, LLC to assist in the development of approximately 62,000 gross square feet of commercial uses-both projects located within the University Crossing redevelopment project located on the southwest corner of the intersection of University Avenue and the Whitney Way in the TID #41 (University-Whitney).
Sponsors: Mark Clear
Attachments: 1. 9897 University Crossing Phase II TIF Report 6-21-12.pdf
Fiscal Note
This resolution would authorize two end-loans, disbursed to two separate borrowers upon completion of their respective projects, in the aggregate amount of $3,106,000 for the development of apartments and a parking structure (“Apartment Project”) and an office building (“Office Project”) on the former Erdman property located at the southwest corner of University Avenue and Whitney Way. The two end-loans would be repaid through incremental taxes generated by the Apartment Project and Office Project and, in aggregate, represent approximately 62% of the present value of all incremental taxes anticipated from the Apartment Project and Office Project throughout the 27-year life of TID #41, created on September 6, 2011. This requires an exception to the 50% Rule in City of Madison TIF Policy.

Funds to capitalize this loan would require authorization in the 2013 Capital Budget, funded with internal borrowing or general obligation debt. While it is anticipated that the incremental taxes generated by each Project will be sufficient to repay their respective loans within approximately 10 years, both Borrowers are required to guarantee a minimum payment on their respective loan if sufficient future tax increment is not available.

The Apartment Borrower is also obligated to return an equity participation payment equal to either nine percent (9%) of the gross selling price of the Property, including improvements thereon, on the day of sale or nine percent (9%) of the assessed valuation of the Property, including improvements thereon on September 6, 2038 whichever occurs first, in an amount not to exceed $2,019,000. The Office Borrower is also obligated to return an equity participation payment equal to either seven percent (7%) of the gross selling price of the Property, including improvements thereon, on the day of sale or seven percent (7%) of the assessed valuation of the Property, including improvements thereon on September 6, 2038 whichever occurs first, ...

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