1993-09-01 - Village Board Committee of the Whole - Minutes SUMMARY OF COMMITTEE OF THE WHOLE OF THE PRESIDENT AND BOARD OF TRUSTEES OF THE
VILLAGE OF BUFFALO GROVE, ILLINOIS, HELD WEDNESDAY, SEPTEMBER 1, 1993, AT THE
MUNICIPAL BUILDING, 50 RAUPP BOULEVARD, BUFFALO GROVE, ILLINOIS.
President Mathias called the meeting to order at 6:38 P.M. Roll call indicated
the following present: President Mathias; Trustees Reid, Kahn, Rubin, Braiman,
Hendricks.
Also present were: William Balling, Village Manager; William Raysa, Village
Attorney; William Brimm, Finance Director.
Mr. Balling stated the purpose of the meeting was to insure that staff
understands the direction the Board wants to take in regard to the drafting of
the final TIF documents. The staff has assumed that the tax payments to the
district would offset their tax loss. The Village was foregoing its tax loss in
exchange for redevelopment hoping that cash incentives assure that redevelopment
occurs. The structure proposed permitted the Village to hold the Project funds.
There has been a change in scope in that any new bonded cash at closing, instead
of being used to fund a Project Fund that would be retained by the Village would
be retained instead by Simon and Series C Redevelopment Notes would be issued as
Simon performs his obligations under a redevelopment agreement.
There is a cash penalty of $320,000 by Simon if the movie theater has not been
constructed within a year of date of closing on the bond issue.
President Mathias informed the Trustees of Simon's position and noted that Simon
says that this is not a change in their position. From the beginning it was
their position not to put $1.85 million in a fund in the form of B bonds.
President Mathias informed Simon the Board was not comfortable with their
guarantees.
Trustee Kahn stated that it was acceptable to the Joint Review Board that Simon
could control the $1.85 million as long as the payouts were based on completion
targets and the funds were held by the Village.
Trustee Braiman is not comfortable to give them the money with no guidelines.
Trustee Kahn believes the track record of Simon is poor, but positive things such
as the Rotary Green and the post office have happened. The Village should not
allow Simon to refinance with no contingencies.
Trustee Reid suggested putting the $1.85 million in escrow, with a third party
trustee but not give it to Simon. Trustee Reid wants a timetable as well as the
Village holding the $1.85 million. He wants to be sure the money is used for the
purposes the Village has in mind.
The bond ordinance is structured so that the Board authorizes a not-to-exceed
interest rate. The investment banker wants 7-9%; the Village wants 5.5-6.5%
Once the Board passes on the ordinance, there is no other action needed by the
Board regarding approval of the rate. Unlike other bond ordinances, this time
the Board passes the ordinance that sets the interest rate range. Trustee Reid
would like to see the Village President and two trustees agree to the final
interest rate even if it is a formality.
The theater agreement should state that when the certificate of occupancy is
issued and Melvin Simon has satisfied his requirements the $325,000 will be
returned.
Attorney Raysa reported that he has not yet been given a copy of the Development
Ordinance priorities. This document should outline the development plan
priorities: Level A - theater Level B - new anchor Level C - land acquisition.
COMMITTEE OF THE WHOLE
September 1, 1993
Page 2
There were no further questions from the Trustees.
Moved by Braiman, seconded by Reid, to adjourn the meeting. The meeting was
adjourned at 7:41 P.M.
dOr
Jane son, Deputy Village Clerk