The Wheaton City Council remains somewhat divided on the need for financial protection related to its TIF money investment in a proposed downtown apartment complex.
On Monday, the council met in a special session to again consider a redevelopment agreement and the overall plan by Morningside Equities to build the 306-unit building on a vacant block bounded by Wesley, Cross, Front and Scott streets.
City Manager Don Rose said details of a letter of credit and a subordination agreement remained in flux since the council met a week ago, with some information on what Morningside's lender, Bank of America, wants not reaching council members until late Monday afternoon.
"I just got these packets now," council member Evelyn Pacino Sanguinetti said. "I don't make decisions like this off the cuff."
The council will again consider Morningside's proposal and the redevelopment at its July 2 meeting.
As happened last week, some on the council preferred to have some assurance it will recoup approximately $500,000 in upfront costs, paid via Tax Increment Financing funds, to bury power lines. A letter of credit has been discussed as the most likely way to achieve that, but council members do not want to pay $30,000 in maintenance fees on the letter and want it be in place until the project is nearly completed.
Council member John Rutledge suggested Morningside put the money into an escrow account, which would also eliminate the maintenance fees. Council member Jeanne Ives indicated she'd go along with Rutledge's idea, but put the entire financial issue into perspective while expressing her support for the overall project. She said the $500,000 investment totals about two percent of Morningside's estimated $60 million project. The city has invested a greater percentage of TIF money in other projects with less general benefit, she said.
"They are building some distinctive public spots that people can enjoy, that will be more attractive to our downtown," Ives offered. (Morningside) has been more than patient with our process."
Last week, Morningside President David Strosberg expressed frustration with the length of time it has taken to get final approval from the city. Rose said he would speak Strosberg before the next meeting to discuss alternatives to the letter of credit. While no decisions were made, he said the meeting "established the council's perspective."
Morningside's proposal, called Wheaton 121, would build the complex at 218 Wesley Street with TIF District 2 funds for public improvements, including public plazas, street lighting, curb improvements and public benches.
The most expensive public improvement will be the burial of overhead utility lines along the west and north sides of the property for an estimated $500,000, Rose previously told Council.
, Morningside initially requested $2.3 million for assistance with several planned improvement projects, including utility relocation and improvements, site amenities such as light poles, benches, trash, recycling receptacles and bike racks, public plazas with fountain features and seating, a detention and lift station required because of the depth of Wheaton’s sewers, environmental remediation, design, construction and management. Rent for the apartment complex is expected to range between $1,000 and $2,300 per month, excluding utilities.