I. RECOMMENDATION:
Staff recommends waiving City Permit and Plan Check Fees, as requested, and providing a loan to KOZ Real Estate but not based on the terms requested.
II. BACKGROUND:
For approximately one year, staff has been working with KOZ Real Estate in regard to their plans for developing the former Kmart parking lot.
On April 18, 2022, the City received a written request for a waiver of permit and plan check fees as well as a low interest loan in the amount of $3,500,000 to help the project move forward.
III. DISCUSSION:
The written request is attached.
KOZ Real Estate plans to be in attendance at the City Council meeting and can explain their plans for the property.
Staff's recommendation is to provide support to KOZ Real Estate to help the project move forward, but cannot ethically recommend entirely what KOZ Real Estate is requesting.
Staff would recommend waiving permit and plan check fees and providing a zero-interest or low-interest loan to KOZ Real Estate, not to exceed $1,000,000, or appraised value of the old Kmart property, whichever is less, secured by a lien on the property.
The loan would come from the City's General Fund Reserve which currently has $4,700,000 that is intended to provide financial security to the City. A loan in the amount of $3,500,000 with tax payer dollars would be risky leaving the City with only 1,200,000 in Reserves which would only get us by for approximately 45 days. Additionally, should the loan not be secured by way of property lien and remain unpaid for some reason, the City would have no way to recoup its lost funds.
IV. ALTERNATIVES:
1. Grant written request;
2. Deny request;
3. Agree to other terms.
V. FISCAL IMPACT:
Dependent upon Council action |