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have applied for additiona13.7 million in a federal grant. The biggest piece of that is to do the demolition <br />and site preparation on the block. That will substantially reduce the private developers cost in the project. <br />We think (Randy and RG) that even without the federal grant, the project probably is feasible, probably <br />borderline. But with the federal grant this project is a go. In addition, we are hoping to obtain 1 to 2 <br />~ million for the city in urban renewal money. The city has given tentative support for that. That is really <br />another partnership. There are really five parties who have financial interest and commitment. <br />Randy continued by stating that next week we are really just selecting that final partner. Selecting that <br />partner in no way guarantees this project will work. Right now the County owns its buildings. Current rate <br />of rent on County buildings is $.85 a foot. Market rate is $1.20 -$1.40. It is critical that we work with the <br />developer to get the cost down. If the project requires that the County pay the market rate, it will not work. <br />If it's an extravagant building, the County will not be able to afford it. He has projected to the County budget <br />officer that this project will cost an additional $250, 000 -$300,000 annually in new money, starting in 1999, <br />just to afford the new space. That means we have to start looking three years ahead and the County budget <br />committee needs to decide if we can make that commitment. These are some of the things that we wanted <br />the panel to be aware of. <br />Bob Speckman asked Randy if in a partnership, the County will always own the land, but the building will <br />be owned by the developer, and the County lease fees will be just on their building space. <br />RG responded that Transit will own their space outright. <br />Randy responded that there is value in the land lease that is a credit back to the County and the developer <br />ends up owning the retail space. The land always stays in public ownership. <br />~ RG clarified that it may or may not be the County, it may be a combination of Transit and the County. The <br />square footage that is private use will pay taxes, from day one, even the portion that will eventually be the <br />County's. <br />Bob suggested that this is another way to buy down the square footage cost. <br />Randy added that even if the land and the entire building was in private ownership, as with the City of <br />Salem, any portion of the public buildings, including the parking structure, as long as you are leasing it for <br />profit, it is on the tax roles. It is primarily the use of the property determines. <br />Dick question that a$.80 a square foot, is this building going to have a roof? <br />Randy responded that he doesn't expect to get it at $.80 a square foot. <br />There was discussion of proposals, the preliminary estimates of where we could run into problems. Randy <br />pointed out that the Prudential proposal provided more details and options. David Glennie stated that he <br />did not see where they provided for ownership. <br />Randy expressed his understanding that there would be lease back, as the project is better defined. Based <br />on the phone calls he has been receiving, without knowing who the parties are representing, it sounds like <br />there would be at least partial ownership. These are some of the issues that should be raised during the <br />selection process and should be part of the agreement. <br />~ Rand Franke added in re ards to the cost of s ace, the anel should keep in mind that for the County it <br />Y ~ g P P <br />is not an evaluation of what we are currently paying. The Board is required to provide adequate room for <br />