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1 BUSINESS AGENDA: <br />2 <br />3 MOTION - Auprove a Loan far S224A50 for the Forest Park Crossing apartment <br />4 community (Irene Sacks. Director ofBusiness and Community and Business) (Cony included <br />5 as Ezhibit A) <br />6 <br />7 Irene Sacks explained that the City of Kannapolis loaned $220,500 in HOME funds to Douglas <br />8 Development to build the Villas at Forest Park, a 64-unit senior, low-income apartment <br />9 community off Little Texas Road which opened in the spring of 2009 and leased up quickly. The <br />10 loan at 2% interest for 20 years will be treated as program income for the City. The first <br />11 payment of $13,385.64 is due on July 1, 2010. <br />12 <br />13 Douglas Development plans to build aloes-income family apartment community on the parcel <br />14 they own adjacent to the Villas and next to Forest Park Elementary School. Called Forest Park <br />15 Crossing, it would be 56 units for families at 60% of area median income or below (roughly <br />16 $40,000 fora 4-person family). The total investment for the project is $7.8 million. A <br />17 community center, playground and picnic areas are included in the plans. The developers would <br />18 hire a management company that conducts strict criminal and background checks on applicants, <br />19 and plans to include Kannapolis Police Department in this process. <br />20 <br />21 Douglas Development is submitting an application to the North Carolina Housing Finance <br />22 Agency (NCHFA} for tax credits. The process of being awarded the tax credits involves a <br />23 scoring system that includes points for various factors, one of which is a contribution from the <br />24 local government toward the funding of the project. Douglas Development has approached the <br />2S City of Kannapolis to request a loan from HOME funds to generate additional points needed to <br />26 make their application competitive. Based on the number of units, the minimum amount that <br />27 would need to be loaned to score points with NCHFA is $224,450. A local government <br />28 contribution is not required but may make the project less competitive. <br />29 <br />30 Staffs assessment of the pros and cons of funding this proposal are included in the backup <br />31 materials. <br />32 <br />33^ The Kannapolis Police Department has expressed concerns about the crime associated with <br />34 existing low-income apartment communities in the City and that these would also occur at Forest <br />35 Park Crossing. <br />36 <br />37 Traci Dusenbury of Douglas Development, LLC, Richmond, Virginia spoke to Council about the <br />38 planned project. Dusenbury said this is a win-win situation for the City and Douglas <br />39 Development. She said there is a great need in Kannapolis for more affordable housing, that all <br />40 existing complexes are full with waitin~ lists due to the downturn of the economy. Ms. <br />41 Dusenbury said her company has done a 3` party study which shows there is a demand for more <br />42 than 1,600 Iow-income housing units in Kannapolis. She said Douglas Development has a <br />43 proven track record with the City and she is well aware that crime is a concern. They are willing <br />44 to work with the Police Department by allowing them to review all applicants. <br />45 <br />City Council Minutes 4 <br />May 10, 2410 <br />Attachment number 6 <br />G-3 Page 188 <br />