City Council approves housing and safety projects

Dane and Tammy Castellano have owned this lot for a few years now, and, because of interest rates, have had a hard time penciling this project out from an affordability standpoint. They asked if the City would essentially "loan" them the money to put the infrastructure in on this project. The attached agreement contemplates reimbursing them as they incur the costs for the estimated infrastructure costs, including street, water, sewer, and site work. To pay us back, we will keep 100% of the real estate tax increment on this property until we are paid back in full, at which point the agreement will revert to a standard 60% Developer versus 40% City agreement, where they can recoup their other costs, mainly land acquisition and professional fees. Additionally, they have to build out the 19 houses across the next 48 months or the agreement is considered in default, and we would follow the legal process to recoup any paid funds. I get the sense that if this agreement does not pass, they will forego the project. I'm not saying that as a reason to ask for your yes vote; I simply say that as fact. I do believe this is a good project, and the more residential properties we can see built in Marion, the better. I've attached my TIF worksheet on this property for your review. By my calculations, I believe the City could be paid back in as few as 8 years, leaving another 10 for them to recoup their costs. To put it another way, would you be willing to offer an 8-year loan to see 19 homes built where that loan is paid off in full in 8 years? That is ultimately the question. We have the TIF funds available and I would imagine if your answer is yes, we will likely be approached by this same group in the future as well as other developers. We've not offered a deal like this since I've been at the City, but with an abundance of TIF funds available in the Residential TIFs, it would certainly expand our housing market. | reports=1