Fiscal Note
The Resolution will authorize the conversion of a City administered CDBG deferred payment rehabilitation loan of $28,700 to an installment loan, with $8,000 of original principal forgiven upon completion of the new loan terms. Total principal repayment will be $20,700, no interest will be paid, and $8,000 will be forgiven. There is no impact on the City levy.
Title
Authorizing the approval of the re-structuring of the Tenney Nursery and Parent Center, Inc. deferred loan to an installment loan.
Body
Tenney Nursery and Parent Center, Inc (TNPC) owns a property located at 1321 E. Mifflin St. TNPC occupy the first floor and leases the second floor of the building. In 1996, Centro Hispano wanted to lease the second floor but needed accessibility modifications to their space so program participants could access their services.
TNPC, as owner of the property, needed to be the applicant agency to CDBG to access rehab funds to install a wheelchair lift to make Centro Hispano services accessible. As part of receipt of the rehab funds, TNPC signed a promissory note for a deferred loan in the amount of $28,700. The loan was deferred until such time that the property would be sold, had a change of use or discontinued eligible use.
WHEREAS, on February 20, 2013, TNPC requested a subordination of the City of Madison loan as part of a refinance of the property debt.
WHEREAS, CDBG staff reviewed this request and determined that Centro Hispano had moved out of the property and the second floor was leased to two new tenants.
WHEREAS, in order for the City’s loan to continue to be deferred the new tenants would need to serve at least 51% low and moderate income persons.
WHEREAS, the new tenants did not meet this threshold so the loan would become due and payable.
WHEREAS, TNPC stated they could not afford to pay the loan in full.
WHEREAS, CDBG staff worked with TNPC to determine a repayment schedule that they could afford.
WHEREAS, the repayment...
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