Tuesday, May 11, 2010

ZAP! #7

ZAP! #7....May 11, 2010

The following item is on the council agenda for approval Thursday, May 13, 2010. Did the council cancel their meeting before the election to keep this item from having to be discussed by those running for re-election?

10 Resolution -- Approving a Chapter 380 Economic Development Program Agreement with Heritage District, LLC, to Facilitate Acquisition and Demolition of the Lakes at Hilltop for the Heritage Crossing Project
Administrative Comments
1. This item supports Strategic Goal No. 3: Economic Development.
2. Impact: This agreement provides funding for the acquisition and demolition of critical property to continue the momentum of the Heritage Crossing Project.
3. The Lakes at Hilltop was purchased by a McDougal Company entity in 2007 but was subject to a retained deed of trust held by the lender due to a prepayment lockout. Delbert McDougal has negotiated a release of the property without the prepayment penalty. The balance remaining on the purchase price, including the operations deficit, is $1,693,475.59 and the anticipated cost of demolition is $390,815.00. Therefore, the incentive agreement is for a loan in an amount not to exceed $2,084,290.59. Payment of demolition costs will be based on actual invoices.
4. The proposed agreement provides for the city to fund the purchase of the property and demolition of the improvements with the city retaining a first lien on the property. The loan will be repaid upon the first to occur of the following: the property is sold, the property is rolled in construction financing, or upon the application for a building permit on the applicable parcel of land.
5. Funding for the current fiscal year in the amount of $2,084,290.59 is available in the Economic Development Fund.
The resolution be approved.

Other than this being yet another loan to McDougal, demolition could be accomplished by ten Lubbock frat boys for probably $50,000.
McDougal: the gift that keeps on giving receiving!

-- Mark Holbrook