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HomeMy WebLinkAboutResolution No. 2026-02 Recommending Loan - SignedRESOLUTION NO. 2026-02 A RESOLUTION OF THE SOUTH BEND ECONOMIC DEVELOPMENT COMMISSION AUTHORIZING A DIRECT LOAN TO THE DEVELOPER OF AN ECONOMIC DEVELOPMENT FACILITY (BEACON HEIGHTS PROJECT) AND APPROVING OTHER MATTERS IN CONNECTION THEREWITH WHEREAS, the City of South Bend, Indiana (the “City”), is a municipal corporation and political subdivision of the State of Indiana and by virtue of I.C. 36-7-11.9, I.C. 36-7-12 and I.C. 36-7-14 (collectively, the “Act”) and has previously established the South Bend Economic Development Commission (the “Commission”) to investigate, study, and survey the need for additional job opportunities, industrial diversification, water services, and pollution control facilities in the City, and recommend actions to improve or promote job opportunities, industrial diversification, water services, and availability of pollution control facilities in the City; and WHEREAS, the Act declares that the financing and refinancing of economic development facilities (as defined in the Act) constitutes a public purpose; and WHEREAS, pursuant to the Act, the City is authorized to make loans for the purpose of financing, reimbursing or refinancing all or a portion of the costs of acquisition, construction, renovation, installation and equipping of economic development facilities in order to foster diversification of economic development and creation or retention of opportunities for gainful employment in or near the City; and WHEREAS, Beacon Apartments Preservation LLC, an Indiana limited liability company (the “Developer”) has informed the City that it desires to construct, renovate and/or rehabilitate certain economic development facilities within the City which will consist of up to one hundred seventy-four (174) affordable housing units in the existing Beacon Heights development in the River West Development Area in the City, with an approximate total redevelopment cost of Forty- Seven Million Dollars ($47,000,000) including a private investment of no less than Forty-Seven Million Dollars ($47,000,000) to be expended by the Developer (collectively, the “Project”), and has requested that the City make a loan to the Developer for the purposes of financing or reimbursing the Developer for a portion of the costs of construction, renovation and/or rehabilitation of the Project; and WHEREAS, the Project will be located in or physically connected to, and will directly serve and benefit, the River West Development Area and the River West Development Area Allocation Area (the “Allocation Area”); and WHEREAS, the Developer has advised the City and the Commission regarding the Project, and requested that the City make a loan to the Developer pursuant to the Act in a total amount not to exceed One Million Two Hundred Fifty Thousand Dollars ($1,250,000) for the purpose of financing or reimbursing a portion of the costs of the Project (the “Loan”) as described in the proposed Financing and Loan Agreement between the City and the Developer (the “Loan Agreement”); and 2 WHEREAS, the Commission has studied the Project and the proposed financing of the Project and its effect on the health and general welfare of the City and its citizens; and WHEREAS, the completion of the Project results in the diversification of industry, the creation of jobs and the creation and retention of business opportunities in the City; and WHEREAS, pursuant to I.C. § 36-7-12-24, the Commission published notice of a public hearing (the “Public Hearing”) on the proposed financing of a portion of the costs of the Project, and the Commission held the public hearing on the Project on June 18, 2026; and WHEREAS, there has been submitted to the Commission prior to this meeting substantially final forms of: (a) the Loan Agreement; (b) the Funding and Reimbursement Agreement (the “Funding Agreement”) between the City and the South Bend Redevelopment Commission (the “Redevelopment Commission”); and (c) the Ordinance of the Common Council (the “Common Council”) authorizing the Loan (the “Ordinance” and, together with the Loan Agreement and the Funding Agreement, collectively, the “Financing Agreements”); and WHEREAS, pursuant to Indiana Code 36-7-14-39(b)(4), the Redevelopment Commission may use certain incremental property taxes, among other purposes, to reimburse the City for expenditures (including loans) made for local public improvements (which include buildings, parking facilities, and all expenses reasonably incurred in connection with the acquisition and redevelopment of property) that are physically located in or physically connected to the Allocation Area; and WHEREAS, the Redevelopment Commission has adopted its Resolution No. 3672 on June 11, 2026, determining, subject to appropriation by the Redevelopment Commission, to make available tax increment revenues on deposit in the allocation fund for the Allocation Area (the “River West TIF Revenues”) to simultaneously reimburse the City for its costs incurred to fund the Loan to the Developer with respect to the Project. NOW, THEREFORE, BE IT RESOLVED BY THE SOUTH BEND ECONOMIC DEVELOPMENT COMMISSION AS FOLLOWS: SECTION 1. The Commission hereby finds, determines, ratifies and confirms that the diversification of industry, the retention of business opportunities and the retention of opportunities for gainful employment within the jurisdiction of the City is desirable, serves a public purpose, and is of benefit to the health and general welfare of the City; and that it is in the public interest that the City take such action as it lawfully may to encourage the diversification of industry, the retention of business opportunities, and the retention of opportunities for gainful employment within the jurisdiction of the City. SECTION 2. The Commission hereby determines that the Project is an “economic development facility” within the meaning of I.C. 36-7-11.9-3. SECTION 3. The Commission hereby determines that the Project will not have a material adverse competitive effect on any similar facilities already constructed or operating in or near the City. 3 SECTION 4. The Commission hereby approves the report with respect to the Project presented at this meeting. The Secretary of this Commission is directed to submit such report to the executive director or chairman of the plan commission of the City. SECTION 5. The Commission hereby finds, determines, ratifies and confirms that making the Loan to the Developer, in an aggregate amount not to exceed One Million Two Hundred Fifty Thousand Dollars ($1,250,000), to finance a portion of the cost of the Project, will be of benefit to the health and general welfare of the City, will serve the public purposes referred to above in accordance with the Act, and fully comply with the Act. Furthermore, the Commission hereby finds and determines that the Loan may be subject to forgiveness upon satisfaction of certain conditions described in the Financing Agreements, and acknowledges that, in the event that the Loan is forgiven, the consideration received by the City for the Loan being forgiven is the completion of the Project by the Developer and the economic benefits resulting to the City therefrom. SECTION 6. The financing of the Project by making the Loan to the Developer, in an aggregate amount not to exceed One Million Two Hundred Fifty Thousand Dollars ($1,250,000), is hereby approved. SECTION 7. The Commission hereby approves and recommends to the Common Council of the City the terms of the following documents in the form presented at this meeting: (a) the Loan Agreement (including the promissory note from the Developer); (b) the Funding Agreement; and (c) the Ordinance. SECTION 8. Any officer of the Commission is hereby authorized and directed, in the name and on behalf of the Commission, to execute any and all other agreements, documents and instruments, perform any and all acts, approve any and all matters, and do any and all other things deemed by him or her to be necessary or desirable in order to carry out and comply with the intent, conditions and purposes of this resolution (including the preambles hereto and the documents mentioned herein), the Project and the making of the Loan, and any such execution, performance, approval or doing of other things heretofore effected be, and hereby is, ratified and approved. SECTION 9. The Secretary of this Commission shall transmit this resolution, together with the forms of the Financing Agreements approved by this resolution, to the Common Council. SECTION 10. This resolution shall be in full force and effect upon adoption. *****