HomeMy WebLinkAbout4. Waiver of Residential Rehab Loan
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CITY OF SHAKOPEE
Memorandum
CASE NO.: Not Applicable
TO: Shakopee Economic Development Authority (ED A)
Mark McNeill, City Administrator/EDA Executive Director
FROM: R. Michael Leek, Community Development Director
SUBJECT: Possible Request to Release Lien for Rehabilitation Loan for Property
Located at 338 2nd Avenue East.
MEETING DATE: June 16, 2009
REVIEW PERIOD: Not Applicable
INTRODUCTION:
The Carver CDA has communicated to staff a possible request by Robert and Amy Tasto for a
lien release in connection with the residential rehabilitation loan they received for the above-
named property. The apparent reason for the request is that the homeowners have lost their local
employment, and are having to seek employment outside the Metropolitan Area. As a result,
their home is currently on the market. In addition, Mr. Tasto recently broke his arm and, because
they do not currently have medical insurance, they are incurring additional medical costs. In the
event that the house sells, the Carver CDA expects that the Tastos have to consider formally
seeking a lien release for the balance of the loan.
The original loan was made on January 30, 2004 in the amount of$19,000. Because 10% of
these loans are forgiven for each year that the loan recipient remains in the house, the remaining
balance from which the Tastos would be seeking release is $7600.00.
DISCUSSION:
Several years ago the City secured a Small Cities Development Block Grant, and with a portion
of the funds established a residential rehab loan program. This program is administered for the
City by the Carver County Community Development Agency (Carver CDA).
As the attached table shows, seventeen loans were made under this program. Seven of these
loans have been re-paid to date. The intent of the program was to allow the City to use any
repaid funds in a revolving loan fund (RLF) for future rehabilitation loans. One loan is not listed
in the table; it was a loan Dorothy Egan for 129 Main Street North. In June of2008, the Council
released the City's lien in the amount of$1,111.50 against that property located at 129 Main Street
North.
Before bringing the current request for lien waiver to the Council, City staff asked the Carver
CDA to provide the attached information, so that staff could be determine the maximum total
amount of outstanding loans is. The reason for wanting to present this information is to let the
H:\CC\2009\Tasto Lien Release.doc 1
Council know the maximum amount of loan funds that would be foregone if all of the remaining
loan recipients sought a lien release from the City. The approximate, remaining balances are
listed below. There is current indication that any of the other loan recipients will be seeking lien
relations.
. 337 Fillmore St. S. $5700.00
. 208 Atwood St. S. 1900.00
. 242 Minnesota St. S. 5225.00
. 733 3rd Ave. E. 5700.00
. 537 4th Ave. E. 5700.00
. 229 1 st Ave. W. 1710.00
. 1027 2nd Ave. E. 3580.00
. 823 Bluff Ave. E. 566.00
. 504 2nd Ave. W. 1520.00
Current Remaining Balances $31,601.00
ALTERNATIVES:
1. Offer a motion to authorize the appropriate City officials to take the necessary steps to, at the
time of sale ofthe property located at 338 2ND Ave. E, release the City's lien in an amount up to
$7,600.00, and move its adoption.
2. Offer a motion denying the requested lien release in the amount of$7,600.00 against the
property located at 338 2ND Ave. E., and move its adoption.
3. Table the request for additional information.
VISIONING RELATIONSHIP:
This action supports Goal F, "Housekeeping."
ACTION REQUESTED:
If, after discussion, the Council is inclined to Offer a motion to authorize the appropriate City
officials to take the necessary steps to release the City's lien in an amount up to $7,600.00 against
the property located at 129 Main Street North, and move its adoption. In the event that Council is
not in agreement with the action requested, it should move and adopt an alternate motion.
4~~~~
R. Michael Leek
H:\CC\2009\Tasto Lien Release.doc 2
Name Address Loan Amount Loan Date Paid Off? Date Paid Off Amount Paid Back to City of Shakopee
Merle (Nelson) Chin 411 2nd Ave E $13,696.80 9/7/2001 y 1/13/2004 $10,957.44
Lucille Odenwald 614 2nd Ave E $8,763.49 10/3/2001 Y 10/21/2002 $8,716.00
Eugene Netzband 518 3rd Ave E $15,200.00 8/21/2002 y 1/3/2007 $9,120.00
Luis & Ann Canchari 438 2nd Ave E $6,568.00 12/11/2000 Y 8/25/2004 $4,597.00
Cynthia Sargent 744 2nd Ave E $13,300.00 1/11/2002 Y 1/26/2005 $9,310.00
Dorothy Thul 320 2nd Ave W $19,000.00 1/14/2002 Y 10/4/2004 $15,200.00
Gary & Patricia Hawley 103 3rd Ave E $19,000.00 8/8/2000 Y 6/8/2009 $3,800.00
Florian & Donna Dressen 337 Fillmore St S $19,000.00 7/17/2002 N
Barb Breuer 208 Atwood St S $19,000.00 8/1/2000 N
Stephen Sinnen 242 Minnesota St S $17,416.00 8/27/2002 N
Joann Pieske 733 3rd Ave E $19,000.00 6/12/2002 N
Todd & Lynn Anderson 537 4th Ave E $19,000.00 5/15/2002 N
Claude & Mary Sinnen 2291stAve W $17,100.00 8/30/2000 N
Harold & Mary Johnson 1027 2nd Ave E $11,934.40 10/22/2002 N
Michael & Sharon Stephens 823 Bluff Ave E $5,661.60 8/2/2000 N
Christine Valinski 504 2nd Ave W $15,200.00 8/7/2000 N