Fiscal Note
Up to $300,000 is authorized in the City’s Adopted 2016 Capital Budget for the Economic Development Division’s Project #13 (TID 42 Park/Drake). If approved, this will be the fourth loan under the Small Cap TIF program.
($90,000) 14206643-54835-00000 TID 43 PARK/DRAKE LOANS
Title
Approving a Small Cap TIF #43 Park/Drake (Greenbush) loan of up to $90,000 to Jonathan Roth, Borrower(s), for the purchase and/or renovation of the property located at 424 S. Mills Street, Madison, WI, and its conversion from rental to owner-occupied housing; and authorizing the Mayor and City Clerk to Execute a loan agreement with the Borrower(s) to effectuate this transaction.
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BACKGROUND
Tax Incremental District (TID) #43 (Park/Drake) was created in September 2013 (RES-13-00698, Legistar #31073) for the sole purpose of implementing a Small Cap TIF program to assist with conversion of deteriorating rental housing into renovated single-family homes. The Greenbush Housing Renovation Program, which was created in August 2014 (RES-14-00577, Legistar #34645) and subsequently amended in April 2015 (RES-15-000343, Legistar #37774), provides forgivable loans to eligible borrowers for the purchase and renovation of former single-family homes in the neighborhood that have been most recently utilized as student rental housing. Existing and planned multifamily developments in the TID provide the generation of increment to support this Small Cap TIF program.
Loan funds provided through the Program for each renovation project (“Project”) are subject to the following conditions:
· TIF assistance is provided in the form of a 0% interest, ten-year note secured by subordinated mortgage on the Property, with no debt service payments. Principal balance is forgiven after the completion of renovation work has been verified by the City. A Land Use Restriction Agreement (LURA) is also executed, to ensure owner-occupancy for the entire ten-year period, and contains a penalty provisio...
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