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Mr. Braud noted that the City's suggested assistance to BMC to help it meet the financial underwriting <br />criteria for the project was summarized in the staff memorandum to the council regarding the matter. <br />Mr. Braud elaborated on the use of recovery zone bonds to provide tax exempt status to elements of <br />BMC's financing for its development project. <br />Mr. Braud reported that BMC would be responsible for the repayment of its bank loan for the project and <br />would also assume all of the transaction costs with respect to the project financing. He stated that the <br />City would assume no financial risk with regard to the proposed BMC project. <br />Mr. Braud recommended the council approve the use of approximately $8 million of its $11 million <br />recovery zone facility bond authority. He noted that the bond authority allocation was required to be <br />drawn down by the end of the calendar year. Mr. Braud said staff was seeking the council's general <br />support for the proposed BMC project and that his recommendation was that the council direct staff to <br />return in September with additional project details for the council's consideration. <br />Mr. Braud, responding to a question from Mayor Piercy, stated that in its initial planning stages for the <br />vacant parcel Beam Development had considered the development of housing but that the lease rates for <br />such purposes was too low to make such considerations economically viable. <br />Mayor Piercy pointed out that the City remained committed to the development of housing in the <br />downtown area regardless of the BMC and Beam Development projects and would continue to seek <br />opportunities for such development. <br />Mayor Piercy solicited council comments and questions. <br />Mr. Clark thanked Mr. Braud for his presentation and indicated his general support of the proposed BMC <br />project. <br />Mr. Clark commented on the potential financing gaps Mr. Braud had referenced regarding the BMC <br />project and asked what portion of the City's Downtown Revitalization Loan Program might be applied to <br />such concerns. Mr. Braud responded that the amounts for any such assistance were currently unknown. <br />Ms. Cutsogeorge, responding to a question from Mr. Poling, stated that staff had been investigating <br />possible uses for the remaining $3 million from recovery zone facility bonds. <br />Mr. Poling reminded the council the staff memorandum provided to the council indicated that the State <br />would seek to repurpose the remaining $3 million from the recovery zone facility bonds in the event that <br />such funds were not committed to local projects. <br />City Manager Ruiz and Mr. Braud, responding to a question from Mr. Poling, stated that the City's <br />commitment for leased space under the current proposal for BMC was 20,000 square feet whereas the <br />City's original commitment with Beam Development for the site had been 50,000 square feet. <br />Ms. Cutsogeorge, responding to a question from Mr. Brown, stated that although the recovery zone <br />facility bond funds had become available in February 2009 they had not yet been committed as no viable <br />projects had been identified since that time. <br />Mr. Brown noted his support of every element of the BMC redevelopment proposal with the exception of <br />the provision that the City guarantee 20,000 square feet of leased space in the developed property. <br />MINUTES— Eugene City Council August 11, 2010 Page 2 <br />Work Session <br />