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Home My WebLink AboutMN-CC-1983-10-12COMMON COUNCTI. PROCEEDINGS City of Ithaca, New York Special Meeting 7:30 p.m. October 12, 1983 209 PRESENT: Mayor - Shaw Aldermen (9) - Banfield, Clynes, Dennis, Roffman, Holman, Killeen, Myers, Schl_ather, Schuler ABSENT: Alderman (1) - Holdsworth OTHERS PRESENT: City Attorney - Tavelli Director, Planning & Development - VanCort Dep. Director, Planning Development - Sieverding Personnel Administrator - Best Supt. of Public Works -- Kinsella City Clerk - Rundle Urban Renewal Agency members - Jones, Dennis, Shaw Citizens Savings Bank - George Gesslein Tompkins County Trust Co. - Thomas Smith I.0 Tompkins County Industrial Development Agency - Frank Liguori, l i) PLEDGE OF ALLEGIANCE: (`y Mayor S w le all present in the Pledge of Allegiance to the a ((� American flag. SPECIAL ORDER OF BUSINESS; Revision of UDAG Grant Application for Rothschild Building Mayor S aw presente ack-grouna information ] ea ing up to the meeting that evening with the Urban JZenewal. Agency. Herman Sieverding, Deputy Director, Planning and Development, explained the revisions in the UDAG application which have occurred since the UDAG was approved by Common Council several -months ago. Members of Council asked questions concerning the proposal and received response from H. Sieverding, G. Gesslein, and Thys VanCort. ITHACA URBAN RENEWAL AGENCY /COMMUNITY DEVELOPMENT AGENCY: Iszard's Urban Development Action Grant By U.R. Member Jones: Seconded by MR. Member Dennis WHEREAS, the continued retail use of the Rothschild building is essential to the viability of downtown Tthaca and its role as the retailing center of the County, and WHEREAS, the S.F. Iszard Company has made a commitment to locate in the Rothschild Building contin',ent upon the receipt of a $475,000 UDAG loan required to renovate the building, and WHEREAS, the S.F. Tszard Company will provide the strong retail. anchor necessary to solidify Ithaca's role as the retail center for the area and thereby support the downtown economy, and WHEREAS, the banks holding the bonds on the building and the Tompkins County Industrial Development Agency, owner of the building, request and support the current UDAG proposal, now THEREFORE, BE IT RESOLVED, that the Ithaca Urban Renewal Agency recommend to the Common Council that following changes to the Rothschild Building UDAG submitte`l August 31, 1982 and revised July 6, 1983: 1. S.F. Iszard Company be designated as tenant for the building; 2. UDAG payback terms will be: 210 -2- October 12, 1983 a) Base payment of $21,000 per annum; b) 1_120 of gross sales over a base of $4 .0m. c) Minimum interest rate is set at 4.5% and maximum interest rite at 7.5-0 with any pay- ments in excess of a 7.5o interest return applied to principal reduction; d) UDAG payment to be deferred in years 1 -3 will equal to of the outstanding term loan principal_ as follows: Year 1 $8,500 Year 2 $8,000 Year 3 $7,500 e) UDAG payments to be deferred in the event prime plus to exceeds 15% during years 4 -12 will equal the difference between prime plus to less 150 multiplied by the outstanding " term loan principal. The maximum interest amount deferred will be 30; f) All deferred UDAG payments per (d) and (e) above will be reimbursed to the City by the equity investors. A vote on the resolution resulted as follows: Ayes (3) - Dennis, Jones, Shaw Absent (2) -- Reed, Stein Carried COMMON COUNCIL: Iszar 's Urban Development Action Grant By Alderman Myers: Seconded y Alderman Holman WHEREAS, the continued retail use of the Rothschild building is extremely important to the strangth of downtown Ithaca and its role as the retailing center of the County, and WHEREAS, the S.F. Iszard Company has made a commitment to locate in the Rothschild building contingent upon the receipt of a $475,000 UDAG loan required to renovate the building, and WHEREAS, the S.F. Iszard Company will provide the strong retail anchor necessary to solidify Ithaca's role as the retail center for the area and thereby support the downtown economy, and WHEREAS, the banks holding the bonds on the building and the Tompkins County Industrial Development Agency, owner of the building, request and support the current UDAG proposal; NOW, THEREFORE, BE IT RESOLVED, that the Common Council authorize the following changes to the Rothschild building UDAG application submitted on August 31, 1982; revised on July 6, 1983: 1. S.F. Iszard Company be designated as tenant for the building 2. UDAG loan amount will be $475,000. 3. UDAG payback terms will be: a) base payment of $21,000 per annum b) 120 of gross sales over a base of $4 Om. c) Minimum interest rate is set at 4.5% and maximum interest rate at 7.5o with any pay- ments in excess of a 7.5° interest return applied to principal reduction. d) UDAG payment to be deferred in years 1-3 will equal 10 of the outstanding term _loan principal. as follows: Year 1 $8,500 Year 2 $8,000 Year 3 $7,500 0 -3- October 12, 1 -983 (e) UDAG payment to he deferred in the event prime 211 plus 1% exceeds 15% during years 4 -12 will. equal the difference between prime plus 1% less-l5% multiplied by the outstanding term loan principal. The maximum interest amount: deferred will be 3 %. (f) All deferred UDAG payments per (d) and (e) above will be reimbursed to the City by the equity investors. Amending Resolution By Alderman Myers: Seconded by Alderman Banfield RESOLVED, that item 3(c) read as follows: "Minimum interest rate is set at 4.5% and maximum interest rage at 7.5% with any payments in excess of 7.5% interest return (400", applied to principal reduction. Payment of outstanding principal due would be payable to the City upon resale or refinancing of assumable subject to approval of the City." Carried Unanimously Amending Resolution By Alderman Sc lat er: Seconded by Alderman Clynes RESOLVED, that item 3(f) be amended by adding "annually" following investors. 1IJ Discussion. followed on the floor. !.Y j A vote on the amendment resulted as follows: Ayes (4)- Hoffman, Clynes, Schuler, Schlather Nays (5) - Banfield, Killeen, Holman, Myers, Dennis Absent (1) - Holdsworth Motion Defeated Amending Resolution By Alderman Myers: Seconded by Alderman Banfield RESOLVED, that item 3(f) be amended to read "with 1% in year 1 -3 guaranteed annually, and 3% in year 4 -12, contingent on a minimum of 10% cash on cash return on the initial investment by the capital lease investors," following equity investors. Carried Unanimously Amending Resolution By A— 1 e man Sc lir a-f- er: Seconded by Alderman Dennis RESOLVED, that the following be added to the resolution: "RESOLVED, that Common Council reasserts its strong commitment to Affirmative Action and expectation that that same commitment will be shared by the S.F. Tszard Co., and be it further RESOLVED, that Common Council strongly encourages the S.F. Iszard Co. to give a preference to qualified local people in its hiring policies and practices." Carried Unanimously A vote on the Main Motion as Amended resulted as follows: Ayes(8) - Banfield, Hoffman, Killeen, Dennis, Holman, Myers Clynes, Schlather Nays(1) - SChU1e1- Absent(1) - Holdsworth Carried ADJOURNMENT: On a motion the meeting adjourned at 9 :55 p.m. Jos pfi Runc le, ity Cleri; 1Vi 111am R. Straw, Mayor P COMMON COUNCIL PROCEEDINGS CITY OF ITHACA, NEW YORK Special Meeting 5:00 P.M. October 20, 1 -983 PRESENT: Piavor - Shaw Aldermen (10) .. Banfield, Clynes, Dennis, Hoffman, Holdsworth, Holman, Killeen, Myers, ` >chlat.her, Schuler OTHERS PRESENT: Director, Planning F, Development - Vancort Deputy Director, Planning & Development - Sieverd.ing City Attorney - Tavelli Personnel Administrator - Best Supt. of Public Works - Kinsella City Clerk - Rundle Citizens Savings Bank Ge SIs eit II Center Ithaca - Goldberg Tompkins County Trust Co, VanHoutLe PLEDGE OF ALLEGIANCE: play -- or STiaw led all present in the Pledge of Allegiance to the American flag. SPECIAL ORDER OF BUSINESS: Mayor Shaw - commente t iat the purpose of the meeting was dis- cussion and a proposed resolution concerning the property next to the Center Ithaca and the requested su.bordinati_on of a. mort- gage on, that property, Members of the Council asked questions concerning the loan mortgage subordination and received responses from G. Gesslei.n, R. VanHoutte, H. Sieverding, M. VanCort, and Mayor Shaw. Iszard - Working Capital Loan Mortgage Subordination By Alderman Holman: Seconded By Alderman Myers WHEREAS, the banks holding the IDA bond. used to fi-nance the construction of the Rothschild building have conditionally agreed to lend. $1,4Sm in working capital to the proposed new tenant for the building, the S.F. Iszard Company, and WHEREAS, said banks require additional collateral_ in the form of real estate to secure this Loan, and WHEREAS, the IURA holds a first mortgage on the land under the Green Street parking garage and adjacent to the Rothschild building with G and M Associates, and WHEREAS, G and M Associates will agree to a. $100,000 first collateral lien against this property to satisfy the bank lending requirements, and WHEREAS, G and M Associates cannot enter into this agreement without prior approval of the IURA, and WHEREAS, the IURA has agreed to subordinate its first mortgage position with G and M Associates to the $100,000 first lien with the following terms a) that the lien is released in three years provided that the S.F. Iszard loan is current. In the event the loan is not current in three years, the lien will be released immediately upon the loan becoming current; and b) that all other sources of collateral be exhausted before the banks take action on this lien. The priority is understood to be as follows: