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loan underwriting criteria that will require the project to include adequate collateral and debt service coverage. The project would also have to meet a HUD national objective (elimination of slums and blight or job creation). On July 23, 2007, City Council approved the use of HUD Section 108 and BEDI funds for acquisition of the properties. This action was preceded by a July 16 public hearing before the council. The proposed construction loan (URA Loan #2) would require a separate HUD application request including a public hearing and council resolution prior to HUD review and approval. The total cost of the Beam project is approximately $38 million. The following are summaries of sources and uses for the acquisition of property and renovation/construction: Property Acquisition SOURCES USES HUD Section 108 Loan $ 3,910,000 Acquire Centre Court Property $ 2,800,000 BEDI Grant 990,000 Acquire Washburne Bldg 1,900,000 Urban Renewal Cash 526,000 Collateral Reserve 600,000 Other transaction costs 126,000 Total Sources $ 5, 426,000 Total Uses $ 5,426,000 Project Construction SOURCES USES HUD Section 108 Loan $ 3,990,000 Renovation of Centre Court Bldg $ 16,700,000 BEDI Grant Loan 1,010,000 New Construction 16,300,000 Bank Loan 19,000,000 Beam Equity 4,000,000 Historic Tax Credit Equity 2,000,000 New Mkt Tax Credit Equity 3,000,000 Total Sources $33,000,000 Total Uses $ 33,000,000 On April 3, 2008, the Eugene Redevelopment Advisory Committee (ERAC) reviewed the proposed structure of the Beam project and the proposed URA financial participation. ERAC expressed concerns regarding the scenario in which the URA obtained ownership of the properties with no assurance that Beam’s project would move forward. ERAC also expressed concerns that the long-term investment of limited urban renewal resources in potentially undeveloped properties would ultimately impact other future redevelopment opportunities downtown. ERAC recommended that staff obtain additional project detail from Beam and develop options for moving forward with the Beam project, identifying all of the potential outcomes, both negative and positive, so that an informed decision considering all of the risks and benefits can be made. ERAC suggested that the project be brought back for additional consideration. Following direction from the URA, further details associated with the Beam project will be brought back to ERAC for consideration. L:\CMO\2008 Council Agendas\M080416\S080416A.doc