Unity Plaza money approved by council after legal dispute
Hallmark Partners will receive its $2.6 million from the city for construction of Unity Plaza at 220 Riverside.
City Council approved a contract amendment Tuesday that determines the proof necessary to free up the funds for the developers was acceptable to show the company has invested in the mixed-use project.
"This is a deal that has got to get done," said council member Bill Bishop.
Council member Warren Jones, members of the Office of the General Counsel and attorney Steve Diebenow, representing Hallmark, finished the amendment just in time for it to approved 17-1 as the last council action of the calendar year.
The delay to release the funds for the park portion would have meant an overall delay in the project. The city still will provide a one-time $750,000 payment to the company for long-term park maintenance.
"Is it perfect? Is it the best? No, but it gets the project moving," said Jones.
The original contract called for Hallmark to secure a $30 million binding loan agreement, but the company has enough cash to avoid borrowing.
City General Counsel Cindy Laquidara said Monday that the documents provided to the city did not meet the terms of the original agreement, though she had seen no bad faith in the deal. Without the proper documents, it could increase the financial risk to the city, she said.
Several council members openly disagreed with the notion Tuesday, saying the company has shown its investment.
To access the funds, Hallmark must show receipts for the $12.5 million it has spent so far — $10 million construction and development, $2.5 million for real estate — as part of the $30 million it is required to invest as part of the approved 2007 contract with the city.
If it meets that $30 million mark, Hallmark will receive a $4.9 million Recapture Enhanced Value grant, which is a refund on taxes and other investments a company makes. The $2.6 million for Unity Plaza is not part of that REV grant.