R2006-151 AUTHORIZING AMENDMENT TO REDEVELOPMENT AGREEMENT

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ECONOMIC AND URBAN DEVELOPMENT MEMORANDUM No. 06-234 September 25, 2006 TO: Mayor Paul Osborne and City Council Members FROM: Steve G City Manager Dane C. r g,Assistant City Manager� / SUBJECT: Amended Redevelopment Agreement, 101 East Prairie Avenue SUMMARY RECOMMENDATION: Staff recommends approval of the attached amendment to the approved redevelopment agreement for the building located at 101 East Prairie Avenue. The proposed amendment redirects incentives from the CDBG ' fa�ade program to the Olde Towne TIF fund for the purpose of constructing balconies on ' the building. BACKGROUND: The redevelopment project was approved by the City Council on October 17, 2005. At the time, the developer anticipated the installation of balconies for use on the building as residential condominiums. The developer consulted with City staff on this proposal and staff found it to be a unique product offering for the Decatur market, as well as offering additional on-street security in the downtown azea. At the time the agreement was approved, it was anticipated that the developer would utilize CDBG funding for the fa�ade improvements. Later reviews by the Illinois Historic Preservation Agency determined that the fa�ade improvements, including the balconies, would not be feasible under federal guidelines. The proposed amendment permits the developer to rescind the CDBG agreement and authorizes the TIF Administrator to transfer the necessary funds from the Olde Towne TIF Fund to the CDBG fund to release any and a11 federal fa�ade restrictions on the property. "The increment from the project will repay these funds, approximately $70,000 to the City, over a period of six years. The City will retain a fa�ade easement for life of the TIF agreement. Over the life of the Olde Towne TIF District, this project is estimated to generate $520,000 to the Olde Towne TIF Fund, or approximately 2.8 percent of the Fund's projected increment. Net incremental TIF revenue (after subtracting incentives paid out) will be $275,000. POTENTIAL OBJECTION: Staff is not aware of objectors to this agreement.