HomeMy WebLinkAboutCOUNCIL - AGENDA ITEM - 08/03/1999 - SECOND READING OF ORDINANCE NO. 121, 1999, APPROPR AGENDA ITEM SUMMARY ITEM NUMBER: 14
DATE: August 3, 1999
FORT COLLINS CITY COUNCIL
STAFF: John Fischbach
SUBJECT:
Second Reading of Ordinance No. 121, 1999, Appropriating Prior Year Reserves in the Sales and
Use Tax Fund to Partially Fund the Restoration of the Northern Hotel.
RECOMMENDATION:
Staff and the Finance Committee recommend adoption of the Ordinance on Second Reading.
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EXECUTIVE SUMMARY:
Ordinance No. 121, 1999, which was unanimously adopted on First Reading on July 27, 1999,
appropriates prior year sales and use tax reserves to partially fund restoration of the Northern Hotel.
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AGENDA ITEM SUMMARY ITEM NUMBER: 3
DATE: July 27, 1999
FORT COLLINS CITY COUNCIL
STAFF: John Fischbach
SUBJECT:
First Reading of Ordinance No. 121, 1999,Appropriating Prior Year Reserves in the Sales and Use
Tax Fund to Partially Fund the Restoration of the Northern Hotel.
RECOMMENDATION:
Staff and the Finance Committee recommend adoption of thebrdinance on First Reading.
FINANCIAL IMPACT:
This Ordinance appropriates$670,000 of prior years' Use Tax Carryover Reserve held in the Sales
and Use Tax Fund. The remaining balance after this appropriation is approximately $4.3 million.
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EXECUTIVE SUMMARY:
As a result of a fire in the 1970's,portions of the Northern Hotel were condemned and the majority
of the building remains vacant and in disrepair. In 1978,the City Council adopted Resolution 78-37,
which pledged the City's fullest cooperation and assistancean d all parties actively engaged
in the restoration and reconstruction of the No rq Hotelveral attempts by various parties to
promote the restoration of the Hotel have fade
In the latest effort,Funding Partners for Housing Solutions and the National Development Council
(NDC) formed a development team to redevelop and restore the Hotel as the cornerstone of the
Downtown Area and add affordable housing for the community. NDC is recognized nationally as
one of the leaders in the development of quality affordable housing using Housing Tax Credits and
other public funds. Funding Partners and NDC are in the process of forming a limited partnership
that will include certain private equity investors. The limited partnership will be the owner of the
Northern Hotel.
In March 1999, Funding Partners signed an agreement for the purchase of the Northern Hotel that
provides an excellent opportunity to restore the Hotel as a cornerstone in the Downtown Area and
add affordable housing for the community. In order to effectively leverage private,state,and federal
dollars for the restoration, Funding Partners has requested that the City and the Downtown
DATE: July 27, 1999 2 ITEM NUMBER: 3
Development Authority participate in the project Mth a commitment of approximately$1.0 million.
Because of the timing ofrequired applications for Housing and Historic Tax Credit allocations(April
2, 1999), letters of commitment were needed by April 1, 1999. In March, the Board of the DDA
pledged the Tax Increment potential(approximately$331,000)towards the project. The request for
a commitment of$670,000 from the City was discussed with the Finance Committee on March 18,
1999. The Finance Committee recommended that a City commitment of$670,000 be made. The
prospect of this commitment of funds by the City and the DDA was instrumental in successfully
obtaining approximately S5.0 million in historic rehabilitation and low income housing tax credits.
The proposed redevelopment and restoration plan calls for the following features:
1. Historic renovation of the,building;to its 1936 AxtoDeco facade.
2. Designation of the first floor of the building13,800 square feet, for commercial retail use.
Both College Avenue and Walnut Street sides of the building will have restored storefronts.
3. Designation of the renovated lobby as public space.
4. Designation of the top three floors of the building for rental housing units. Forty-seven
apartments will be created- 6 efficiencies, 38 one-bedroom and 3 two-bedroom units. Rents
will range from approximately S3 75-$480,making them affordable to persons at 40%of median
income. The funding sources identified for thisjeo£.reggre professional management of
apartment units and a minimum $300/unitlyeai-Replacement Reserve. These measures are
required to protect investor equity in the project. Including 7,500 square feet of basement
storage/laundry space, and the new addition described below, a total of 43,100 square feet is `
designated as residential.
5. Construction of a new 4,400 square foot addition to the third and fourth floors of the Hotel,
joining the "v" shaped building into a triangle. This addition will house 8 of the 47 apartment
units and will allow for a single roof over the entire building. This design innovation will solve
complex energy and drainage problems. create an atrium/courtyard into which interior
apartment units will look,and allow for natural lighting of the stained glass dome on the lower
level. -
The Northern Hotel site is properly zoned for the pr, osed project and all infrastructure is in place
including street paving, curb and gutter,sidewalks,-water, sewer,gas,electric,cable and telephone
service. In addition,the developer has completed a study on the building's structural integrity and
Phase I environmental mitigation measures are included in estimated redevelopment costs.
Total project costs are estimated at S9,692,823.
The City Manager is in the process of negotiating a written agreement with Funding Partners and
NDC (to be executed on behalf of the limited partnership). The agreement will require that the
residential portion of the Northern Hotel remain affordable for a twenty year period, along with
additional requirements to protect the City's interest in the project. The agreement will be finalized
prior to August 15,the expected date of closing on the purchase of the Northern Hotel property.
DATE: July 27, 1999 3 ITEM NUMBER: 3
LIST OF ATTACHMENTS:
1. Resolution 78-37
2. Letter from Funding Partners for Housing Solutions (March 1, 1999)
3. Letter of City Commitment
4. Letter from Funding Partners for Housing Solutions (July 14, 1999)
5. Project Narrative-Northern Hotel
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