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HomeMy WebLinkAbout2012-8-7965150841 ORDINANCE NO. 2012-8-7965 AN ORDINANCE ESTABLISHING AND APPROVING THE FOUNTAIN AVENUE COMMERCIAL CONSTRUCTION FINANCIAL ASSISTANCE PROGRAM AND AUTHORIZING THE DIRECTOR OF PLANNING TO ADMINISTER THE PROGRAM AND PROVIDE FINANCICAL ASSISTANCE TO ELIGIBLE APPLICANTS FOR r° CONSTRUCTION OF NEW COMMERCIAL STRUCTURES B WHEREAS, the City of Paducah is charged with the responsibility of overseeing the proper and orderly development or redevelopment of vacant, orphaned, or underutilized residential/commercial properties located within its corporate boundaries and of insuring the integrity and quality of its existing mixed use neighborhoods; and WHEREAS, the City of Paducah's economic well-being is related to and in many respects dependent upon, sustained growth of its tax revenue base through the proper and orderly development or redevelopment of vacant, orphaned, or underutilized commercial properties located within its corporate boundaries; and WHEREAS, in order to fulfill the aforesaid public purpose the City of Paducah is presently engaged in a neighborhood redevelopment program known as the "Fountain Avenue Neighborhood Revitalization Project" whose primary purpose is to revitalize the Fountain Avenue neighborhood through the renovation of existing homes, construction of new homes and infill commercial development which will maintain the appearance of such area; and WHEREAS, the goals of the Phase 1 Fountain Avenue Neighborhood Revitalization Plan (the "Plan"), which was adopted by the City Commission on April 17, 2007, are to promote the redevelopment of the Fountain Avenue Neighborhood by providing incentives to encourage rehabilitation of existing structures and promote quality new infill construction; and WHEREAS, the City of Paducah desires to commitment funds for the establishment of the Fountain Avenue Construction Financial Assistance Program (the "Fountain Avenue Program"), which will be utilized to accomplish the goals of the Plan by providing forgivable -deferred payment loans to eligible applicants for the purpose of commercial/office infill development in the Fountain Avenue neighborhood; and WHEREAS, this Program will encourage construction of commercial/office development on underutilized land located in the Fountain Avenue neighborhood of Paducah where infrastructure and services are in place and promote quality development consistent with the character of the adjacent residential neighborhood and in compliance with the Fountain Avenue Design Guidelines. BE IT ORDAINED BY THE CITY OF PADUCAH, KENTUCKY: SECTION 1. The City of Paducah does hereby commit $40,000.00 to the Fountain Avenue Commercial Construction Financial Assistance Program. The Fountain Avenue Program will make available forgivable -deferred payment loans to eligible applicants for the purpose of construction of new commercial development or offices in the Fountain Avenue neighborhood. The City of Paducah hereby authorizes the Director of Planning to administer the Fountain Avenue Program in accordance with the policies, procedures, and criteria outlined in Section 2, which may be amended from time to time. SECTION 2. Eligibility under this Program will be determined by the Director of Planning, in his sole discretion, based upon the criteria outlined herein. Eligibility will be determined on a "first come, first serve basis," until the fund is depleted. A. Eligibility_ All property receiving the financial assistance under this Program shall be located within the Fountain Avenue Neighborhood as defined in the Plan. 2. Financial assistance under this Program shall only be available to any person, corporation, and entity (i) who holds legal title and ownership (the "Owner") of real property located within the Fountain Avenue Neighborhood (the "Property"), (ii) who have completed construction of new structure(s) on the Property primarily for Owner occupied commercial and/or office uses (the "Project"); and (iii)who have a valid certificate of occupancy issued by the Fire Prevention Division. 3. The Actual Construction Costs (as defined below) for completion of the Project on the Property shall be a minimum of $100,000 to be eligible for financial assistance. S. Financial Assistance Upon completion of the Project in accordance with the certificate of occupancy issued by the Fire Prevention Division, an approved Owner shall receive a forgivable -deferred payment loan in an amount equal to 10% of the Actual Construction Costs paid by the Owner for completion of the Project on the Property, provided, however, the amount of the forgivable -deferred payment loan shall not exceed $20,000. 2. "Actual Construction Costs" shall mean the costs and expenses that are necessarily and reasonably incurred by the Owner to complete the construction of the Project in accordance with the certificate of occupancy, including labor and material costs, subcontractor costs, building permit and inspection fees. Actual Construction Costs shall not include any indirect or incidental costs, such as equipment, tools, overhead, and office and clerical costs. 3. The forgivable -deferred payment loan shall be tied to the issuance of a certificate of occupancy issued by the Division of Fire Prevention. Prior to payment to the Owner, an Affidavit shall be executed by the Owner setting out: a. A permit was obtained from the City of Paducah for the work to be done. b. That the Project has been completed and a certificate of occupancy has been issued by the Fire Prevention Division. C. That all Actual Cost of Construction have been paid and no one can claim a mechanic's or materialman's lien against the Property in accordance with KRS Chapter 276. Mechanics' or materialmen lien waivers executed by the contractor, and all subcontractors and material providers, which evidence the amount of payments received by each of them and their release of any lien interest against the project and the real property shall be provided. d. Proof of expenditures including copies of delivery tickets of materials that are site specific, copies of subcontractors statements showing satisfaction for their labor and materials furnished to the project, copies of statements marked paid with the checks paying same or other information as requested by the Director of Planning. 4. The forgivable -deferred payment loan is a 0% interest loan evidenced by a� promissory note payable to the City of Paducah and secured by a mortgage interest in favor of the City of Paducah. The City of Paducah will prepare a promissory note and mortgage for execution by the Owner and the mortgage shall be recorded. The mortgage would be considered a second or in some cases third mortgage. The promissory note and mortgage will be for the forgivable -deferred payment loan amount and in no case shall exceed $20,000. The Owner shall occupy the new structure(s) constructed upon the Property for commercial and/or offices purposes for a period of 5 years from the date of the execution of the note and mortgage. If the Owner should sell the Property or fails to occupy the Property as an active commercial business or office, such failure shall constitute an event of default under the note, in which event, the holder hereof shall have the right to declare the entire principal amount due under the note to be immediately due and payable, and shall have the further right to make written demand upon the undersigned for payment of same at a sliding reduced rate in the following manner: a. Sale of property less than one year* 100% repayment b. Sale of property after one year but less than two years* 80% repayment C. Sale of property after two years but less than three years* 60% repayment d. Sale of property after three years but less than four years* 40% repayment e. Sale of property after four years but less than five years* 20% repayment f. Sale of property more than five years* 0% repayment * from the date of execution of the note and mortgage. In the event of default, the undersigned shall be liable to pay to the holder for any and all costs and expenses incurred by the holder in the enforcement of this note, including reasonable attorney fees. SECTION 3. That each year the City Commission will review the market conditions in the Fountain Avenue Neighborhood to determine whether to continue the Fountain Avenue Program, amend the program or terminate the program and rely fully on market conditions to complete the redevelopment of the neighborhood. SECTION 4. Severability. If any section, paragraph or provision of this U Ordinance shall be held to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section, paragraph or provision shall not affect any of the remaining provisions of this Ordinance. SECTION 5. Compliance With Open Meetings Laws. The City Commission hereby finds and determines that all formal actions relative to the adoption of this Ordinance were taken in an open meeting of this City Commission, and that all deliberations of this City Commission and of its committees, if any, which resulted in formal action, were in meetings open to the public, in full compliance with applicable legal requirements. SECTION 6. Conflicts. All ordinances, resolutions, orders or parts thereof in conflict with the provisions of this Ordinance are, to the extent of such conflict, hereby repealed and the provisions of this Ordinance shall prevail and be given effect. SECTION 7. Effective Date. This Or and will become effective upon summary publication C, YOR ATTEST: �&qvrxda a : ' J 44 Sfin. TAMMARA S. SANDERSON, CITY CLERK Introduced by the Board of Commissioners, August 14, 2012 Adopted by the Board of Commissioners, August 28, 2012 Recorded by Tammara S. Sanderson, City Clerk, August 28, 2012 Published by The Paducah Sun, September 8, 2012 \ord\plan\ftn ave financial assistance program 8-2012 .1 be read on two separate days KRS Chavtm\424.