To: Honorable Mayor and Members of Town Council
From: Bill Detweiler, Executive Director, Castle Rock Urban Renewal Authority
Bob Slentz, Legal Council, Castle Rock Urban Renewal Authority
Trish Muller, Treasurer, Castle Rock Urban Renewal Authority
Title
Resolution: Approving the Town of Castle Rock / Urban Renewal Authority Loan Agreement
Body
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Executive Summary
On December 1, 2015, the CRURA Board of Commissioners acted on a budget and loan agreement to fund activities of the CRURA program in 2016. The CRURA Executive Director is requesting Council action on the attached loan agreement resolution.
Discussion
The CRURA will not generate an on-going revenue stream until a URA Project has been completed and there is TIF revenue flowing to the Authority. Until that time, the CRURA will incur operating expenses and the CRURA Commissioners are, therefore, requesting a loan to cover such operating costs. Details of the loan agreement are outlined in the resolution and include:
• Language noting the CRURA will pay back the loan, in full, when TIF is collected
• An interest rate not to exceed 3% annually
• A draw down of $14,181 will occur immediately upon Council approval of the loan agreement
• Specific time frame of repayment starting year 4 after the agreement is signed
• Details in the occurrence of default
• Allowance for amendments or waivers if necessary
We do not anticipate submittal of URA Projects which is solely the responsibility of the private sector. There is nothing the URA Commissioners, URA Director, URA Town team or EDC Partners can do to speed up the process, we can only assist in any way possible to move a formal application quickly through the process and meet our customer’s demands. If a URA Project is submitted in 2016 and that application requires more funding to process than predicted, we will come back to the URA Commissioners to amend the 2016 budget and loan agreement, and return to Council to amend the loan agreement.
If acceptable to Town Council, the economic development fund will be used to provide funding for the loan agreement until TIF revenues are generated through the CRURA program and the loan fund will be paid back in full. The economic development fund was used to provide funding for the 2013 / 2014 URA loan agreement.
Budget Impact
The loan request includes up to $14,181 in 2016. Funding may be advanced by the Town to the Authority through December 31, 2016, to be used by the Authority for costs incurred by the Authority for its staffing and consultants in connection with review, processing, and conducting public hearings for any urban renewal plan or project or administrative costs associated with operating the URA Program in 2016. Such amounts shall be paid directly to the Authority by the Town.
Staff Recommendation
Staff recommends approval of the Resolution approving the Town of Castle Rock / Urban Renewal Authority Loan Agreement.
Proposed Motion
“I move to approve a Resolution approving the Town of Castle Rock / Urban Renewal Authority Loan Agreement. “
Attachments
Attachment A: Resolution
Exhibit 1: Promissory Note
Exhibit 2: 2016 Loan Agreement