BY COUNCILOR JOHNSON:
RESOLVED, that pursuant to the requirements of Resolution No. 99-0239, Resolution No. 03D-65 of the Duluth economic development authority (DEDA), a copy of which is on file in the office of the city clerk as Public Document No. _______________, approved at its meeting of December 15, 2003, is hereby approved.
FURTHER RESOLVED, that pursuant to said Resolution No. 03D-65,the city is hereby authorized to accept a forgivable loan from DEDA in the amount of $75,000, payable from DEDA Fund 0865 to City Fund 0262, to be used to defray a portion of the costs of property acquisition and demolition for the San Marco Wethouse project.
FURTHER RESOLVED, that the proper city officials are hereby authorized to repay said loan to DEDA from said Fund 0262 in the event that the project is funded in part by funds provided by the Minnesota state housing and finance agency instead of through the use of low income housing tax credits or in the event that the project is financed through the use of low income housing tax credits but is sold before all such credits allocated to the project are received.
STATEMENT OF PURPOSE: Pursuant to the requirements of Resolution 99-0239, the purpose of this resolution is to authorize a forgivable loan to the city of Duluth in the amount of $75,000, to defray a portion of the cost of acquiring the San Marco site and to demolish the structures thereon as part of Center City's wethouse project.
If low income housing tax credits are used as part of the financial package to fund the development and if all tax credits allocated are actually received by the project, the DEDA loan will be forgiven. However, MHFA has indicated that they may prefer to fund that portion of the project with state bond funds instead of having tax credits allocated to it. In that case, or in the event that the project is sold before all allocated tax credits are used, the project would be required to repay the $75,000 to the city and the city, under this resolution, would repay DEDA.