Abby's here, Justin, okay.

Um 705 on August 25th, 2026.

Uh we're opening the Peak Skill Industrial Development Agency regular meeting.

Um we have some guests tonight from Mount Co.

Um regarding uh the item under new business.

Um so we're gonna move them to the front of the line since we don't have any other folks presenting tonight.

Um in the agenda the revised resolution.

Okay, actually it wasn't revised it, it sounds like but yeah.

Um so uh on the agenda it says Stir Gardens pilot and stir garden subordination resolution.

Actually, what we have is one resolution, Sturgard's authorizing resolution, bond redemption and refinance all in one uh resolution.

So um that's where we are.

And uh so Matthew, you want to kick this off?

Well, I think that'll just didn't make the presentation.

Oh, okay.

Justin, you want to give us a little overview?

Sure, yeah, thank you.

Um and uh and and thanks for moving this to the front uh for Joel and his team.

Uh the IDA uh issued uh I think 7.2 million dollars in affordable housing bonds for store gardens in May of uh 2007.

Um the bonds uh were uh issued by the IDA along with a pilot agreement for a term of 40 years.

Uh we're now about 20 years uh into that process.

Uh their uh lender issued uh a call notice, a notice of redemption uh that needs to be executed as of September 1 of this year.

Uh they're fortunate to get a commitment out of Fanny for uh new permanent financing.

Uh so in connection with the redemption of the bonds, uh they're undertaking uh an amendment restatement of the IDA's lease and lease back to convert that from a bond structure, uh executing a new uh FANI uh mortgage financing, and as part of that, they've submitted an application to the IDA uh for up to a hundred thousand dollars in mortgage recording tax exemptions uh for their new FANI financing.

Um the resolution that's been prepared for the board's consideration uh authorizes the execution of the bond redemption documents, the leases, and to uh facilitate their new FANI financing.

Um that's a quick summary.

If there's any questions, uh Joel and his his team is here, Chris Babcock from his law firm uh is here and and can help with any questions the board may have.

I got one.

Hey Jason, this is Dean Baden.

How are you?

Um Justin.

Justin, did does this redemption impact our our rights or our protections at all?

Not at all.

Uh just the bonds being uh retired and they're converting to what is uh you'd call commercial financing uh undertaken with Fannie Mae, uh which is generally the the best terms, hard to get to and hard to close with them sometimes, uh, but they're very good uh permanent financing terms for affordable housing projects.

The IDA's position stays the same.

Uh the pilot continues for another 20 years along with the companion impact fee agreement executed with the city.

Uh so there's really no change in standing or no revisions to the project at this point.

It's just taking out the old debt and and placing new debt on the project.

The only thing I would add is that the city council on Monday um approved the subordination of their host community fee, which is sort of a companion piece to this.

And Justin, you want to explain how we're going to uh one of the requirements of Fannie Mae is that we have to subordinate our pilot, however, um it's still if there if there's a how I'm not sure how you explain it, but if they renege on their pilot for any reason, that still ends up being in a uh like a tax lien, which comes out first.

Is that correct?

I don't know if I explained it quite right, but maybe you could be a little more eloquent with the expensive.

That's absolutely the right concept.

Yeah.

When the the transaction closed in 2007, uh as is typical, the IDA recorded uh what's called a pilot mortgage.

And what that does is it secures the pilot payments once they're um once they accrue, and if they're not paid, there's a lien there that mimics a tax lien.

It's very common for IDAs to do that.

Without that, the IDA only has a contract claim along with the taxing jurisdiction, so that get kind of messy.

Um what Fannie does and what most commercial lenders do is ask the IDA to subordinate that lien.

Uh and which is fine, but what we do is retain the priority of payment.

So it acts like a tax lien.

Um the the default under the pilot agreement.

If if the uh if the owner doesn't cure that, the the lender will more often than not cure it on behalf of the of the owner.

So places the IDA in a very safe position to protect the interests of the city county at school in this case.

Um a parallel path, uh Banny May and their council.

Um reviewed the municipal impact fee agreement.

Uh that is in favor of the city.

Uh they asked for the same subordination and in an abundance of caution.

Uh the city manager and uh city corporation council processed that through the uh the city council uh just to make sure that there was due authority to execute that subordination.

And as Matthew noted, that was taken care of last week, and uh we're here tonight to uh to tend to attend to the IDA's consent and and uh and get through the process with them for a closing that's scheduled next Tuesday.

Okay, and um Mr.