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Department of Finance
Reference: Loan to BURA
To: Mayor Richard N. McLean and Members of City Council
Through: Manuel Esquibel, City Manager
Prepared By: Dan Frelund, Finance Director
Date Prepared: March 11, 2015
PURPOSE
Adopting a 2015 budget resolution to loan $2,510,000 from the General Fund to the Brighton Urban Renewal Authority (BURA) for the purchase of land acquisition and an Ordinance authorizing a Loan agreement from the City to BURA. This will be a short term loan (6 months) at .4% per annum and the full amount due at maturity. The Loan will be secured by the property purchased by BURA.
BACKGROUND
The City Council has indicated their interest and support of continuing re-development in the core BURA Area. Therefore, the following short term plan is being proposed:
· The City will loan $2,510,000 to BURA via a short term loan of 6 months from the General Fund, with the full amount due at maturity plus interest of .4% per annum. The loan will be secured by the property purchased by BURA.
· Budget resolutions and loan documents will be completed by City Council and the BURA board.
· Funds will be transferred to BURA upon the approval and signature of City Council and the BURA board.
CRITERIA BY WHICH COUNCIL MUST CONSIDER THE ITEM
FINANCIAL IMPACT
This is presented as a short term loan to BURA. Should BURA not be able to repay the City within this time period, then determination of longer term funding will have to be made.
STAFF RECOMMENDATION
Based on City Council's opinion that the re-development within the core BURA area remains a high priority, staff is recommending approval of the 2015 budget amendment for the short-term loan to BURA.
ATTACHMENTS
2015 budget amendment resolution.