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. y ., <br />South Bend Redevelopment Authority <br />Special Meeting - December 17, 1990 <br />3. NEW BUSINESS (Cont.) <br />b. continued... <br />tell what the property owners will receive. The people <br />who Mr. Pendl asked about who will make money on the sale <br />of the bond are people who are providing services to us. <br />Mr. Nussbaum noted that none of the bond funds go to pay <br />for City Attorney or staff expenses. <br />Mr. Pendl's question also concerned an article that he <br />read where a portion of a bond was set aside for <br />capitalized interest, but the bond holders were not <br />paid. The bond was in default and he wondered if <br />property owners who were bought out with the bond would <br />be held partially liable. <br />Mrs. Kolata explained that these bonds are structured so <br />that if there is-not money in the account by a certain <br />date to make the bond payment, the Redevelopment <br />Commission must levy taxes to make the payment. The <br />former property owner has no liability for these bonds. <br />• Mr. Pendl and Mr. Bradford expressed displeasure that a <br />public body is assisting private developers in the <br />acquisition of land from private owners, thereby making <br />the deal more lucrative for the developers and cheating <br />the present owners. Mrs. Kolata noted that the public <br />agency has the ability to assemble the land, reconfigure <br />the parcels, and change the land use. That is the <br />purpose of the public agency's intervention, and that is <br />how the public interest is served. <br />Mr. Pendl asked for assurances that they would not lose <br />money on this transaction. Mrs. Kolata stated, that, <br />although she could make no guarantee that the property <br />owners would not lose money on the sale of their land, <br />the staff will work very hard to see that they are <br />compensated adequately to replace what they. presently <br />have. <br />Mrs. Pendl expressed frustration over the law which <br />allows government to take land from private owners so <br />that no one can ever feel that their property is secure. <br />She asked if the law had ever been challenged. Mr. Hill, <br />bond counsel for this bond issue, responded that the <br />Hawley case, from South Bend, is considered a landmark <br />case on this issue. Mr. Bradford asked if there were <br />cases challenging the acquisition by eminent domain of <br />uncharted green space. Mrs. Kolata responded that she <br />did not know of any. <br />-4- <br />