City Council Agenda and Packet 2012 07 03

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City Council Meeting Minutes June 19, 2012 Page 7 of 20 The team determined the assistance from the City through the Historic Preservation Fund to complete Scenario 1 would need to be approximately $1,350,000. This was determined by; Current purchase contract amount of $950,000 +identified stabilization costs plus inflation $750,000 - Amterre's perceived value of the Napa Building $350,000 $1,350,000 Scenario 2 involves not only purchasing the property and preserving the Grain Elevator, but takes the next step in adding additional resources to finish the Grain Elevator with additions to attract a destination restaurant or retail use. The total development cost based on figures provided by Amterre amounts to approximately $3,300,000 to purchase the property, stabilize the Grain Elevator, complete tenant finish, and construct the needed site improvements. Advancing the project to a level where it can be used by a restaurant or retail use adds additional sources of funding from federal and state partners namely History Colorado (the State Historical Fund Grant Program) and the Federal and State Historic Tax Credit programs. The tenant would pay rent which would add to the ability for the project to borrow funds. Also, the property could generate increased property taxes and sales taxes to the benefit of the City. The following is an estimate of the sources of funding the team identified in their analysis; Total Scenario 2 costs $3,300,000 Less: Federal Historic Tax Credits $390,000 State Historic Tax Credits $40,000 Sale of Napa Building $350,000 Debt Facilitated by Tenant Rent $550,000 History Colorado $200,000 (represents a one -year award) Gap to be filled by City and Partners $1,770,000 If City Council determines the purchase price and the level of assistance needed to complete Scenario 1 is in the City's best interest, the team recommends Council devote the additional funds required for Scenario 2 with Amterre to take the project to full buildout for a tenant. The team strongly supports an active redevelopment site, which has long -term financial and community benefits. The increased assistance required ($420,000) for Scenario 2 would help leverage additional funding sources and put the building back into beneficial use. The team supports a functional use of the building more than just a moth -ball approach. Economic Director DeJong added a caveat; the budgetary estimates are fluid. He pointed Council to a memo from the Historic Preservation Committee expressing their support for restoration or rehabilitation. 19