HomeMy WebLinkAbout2020-12-14 21-044 Order
12/14/202021-044
12/14/2020
21-044
Community & Economic Development
Order
041-096
Title, Order
Authorizing Execution of a Development Agreement and Credit Enhancement Agreement with Schoolhouse
Housing Partners LP for Property at 183 Harlow Street
This order will authorize the execution of a Development Agreement and Credit Enhancement Agreement with
Schoolhouse Housing Partners LP (an affiliated entity of Community Housing of Maine) for property located at 183
Harlow Street. Schoolhouse Housing Partners LP is acquiring and renovating the Schoolhouse Apartments, creating
additional permanently affordable family rental units, along with on-site resident amenities, and proposes to invest at
least $15 million from various funding sources and equity to develop the project, leading to a substantially increased
assessed valuation. The level of investment required for rehabilitation of the property is not economically feasible
without assistance from the City. This assistance can be provided through an agreement with the developer for the City
to return 36% of the increase in real estate taxes paid on the increased valuation created by the improvements to the
property for a period of fifteen (15) years, and forgiveness of an outstanding U.S. Department of Housing and Urban
Development (HUD) Urban Development Action Grant (UDAG) that was loaned to the project in the amount of
$160,000 in 1985. The UDAG was due to be repaid to the City by the previous property owners in December 2015, but
they requested an allonge. This cost is now being passed to Schoolhouse Housing Partners LP in their acquisition, but
the City can forgive it to reduce the project financing gap.
If approved, this order will authorize the City to enter into agreements with Schoolhouse Housing Partners LP under the
following terms: the developer will invest at least $15 million of private funding and equity in the development project;
the City will return to the developer 36% of the real estate taxes paid on the increased valuation of property located at
183 Harlow Street as a result of the investment in the property for a period of fifteen (15) years; the developer will
substantially complete the project by December 2022; and the City will forgive the outstanding $160,000 UDAG loan to
the Schoolhouse project. The final agreement will be in a form approved by the City Solictor's office.
Business & Economic Development Committee
12/08/2020
Recommend for passage
50
New Business
12/14/202021-044
CITY OF BANGOR ORDER
12/14/2020
21-044
Fournier
Authorizing Execution of a Development Agreement and Credit Enhancement Agreement with Schoolhouse
Housing Partners LP for Property at 183 Harlow Street
WHEREAS, the City of Bangor supports reinvestment and the improvement of residential space in the
downtown area; and
WHEREAS, Schoolhouse Apartments at 183 Harlow Street are being acquired by Community Housing of
Maine, with plans to renovate the property for affordable housing and tenant amenities; and
WHEREAS, the developer's renovation of the property will result in substantial increase of the property taxes
on the development; and
WHEREAS, the investment required for rehabilitation of the property is not economically feasible without
assistance; and
WHEREAS, the assistance necessary can be provided through entering a credit enhancement agreement with
Community Housing of Maine to provide the return of 36% of real estate taxes paid on the increase in value
created by the improvements to the property for a period of fifteen (15) years; and
WHEREAS, further assistance can be provided by forgiving the outstanding UDAG loan to the Schoolhouse
project that was made in 1985 and $160,000 was due to be repaid in December 2015; therefore
BE IT ORDERED BY THE CITY COUNCIL OF THE CITY OF BANGOR THAT:
The City Manager is hereby authorized to enter into agreements with Community Housing of Maine under the
following terms: the developer will invest at least $15 million of private funding and equity in the development
project; the City will return to the developer 36% of the real estate taxes paid on the increased valuation of
property located at 183 Harlow Street as a result of the investment in the property for a period of fifteen (15)
years; the developer will substantially complete the project by December, 2022; the City will forgive the
outstanding $160,000 UDAG loan to the Schoolhouse project; and the agreements shall be in a final form
approved by the City Solicitor or Assistant City Solicitor.
IN CITY COUNCIL
DECEMBER 14,2020
CO 21-044
Motion made and seconded for Passage
Vote: 9—0
Councilors Voting Yes: Davitt,Dubay,Fournier, Hawes,Nichols, Okafor, Schaefer, Sprague,Tremble
Councilors Voting No: None
Passed
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