Consent 1.I.
Regular City Council Meeting
- Meeting Date:
- 07/11/2016
- TITLE
- Approval of Downtown Revolving Loan Fund Recommendation for Montdevco II
- PRESENTED BY:
- Patrick M. Weber
- Department:
- City Hall Administration
Presentation:
PROBLEM/ISSUE STATEMENT
The Downtown Revolving Loan Committee met on December 15, 2015 and voted to approve a $250,000 loan to Montdevco II, LLC to assist in them with the predevelopment phase of a potential development known as One Big Sky Center. (see attachment A). Collateral will be the Diamond Parking lot located at N. 29th Street and 1st Ave N. That parcel is 21,000 square feet of developable land within the Tax Increment District and the CBD. At the rate of $40 psf the value would be in the $840,000 range. The Developer paid a higher price for the property and owns it without any liens (see Attachment B) The City's loan will be in first and sole position regarding the collateral. Finance had First Montana Title do a title search, and everything came back ok.
ALTERNATIVES ANALYZED
The Council may approve or disapprove the loan. If Council does not approve the loan, the potential for significant private investment in downtown Billings may decline.
FINANCIAL IMPACT
The Revolving Loan Fund does not owe any money to the banks at this time. The entire loan amount would come from City money in the downtown loan fund.
RECOMMENDATION
The Downtown Revolving Loan Fund Committee recommends that the City Council approve a $250,000 loan to Montdevco II, LLC.