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D E V E L O P M E N T D E P A R T3,9 E N T
[a OF THE CITY 01 SAN BEANIMMD
t _ REQUEST FOR COMMISSION/COUNCIL. ACTION
From: KENNETH J. HENDERSON Subject: sXADRON LOAN
Executive Director EXTENSION REQUEST
Date: April 15, 1993
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Synopsis of Previous Commission/Council/Committee Action-s
On Cctober 30, 1991, the Community Development Commission approved a loan of
$69,500 to Mr. Skadron to assist in the demolition of the northeast corner of
Fourt.b and "H" Streets.
On April 8, 1993, the Redevelopment Committee recommended that the Commission
amenc the loan as described in the attached report.
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Reccmmended Motion(s) :
(Community Development Commission)
MYPICBL: That the Community Development Commission authorize preparation and
t execution of an amendment to the demolition assistance loan of Mr.
Erwin Skadron, lowering his interest rate from 98 to 78 and
extending the term of the loan from October 30, 1994 to October 30,
1996.
Admi trator EASON
__-____________________________________________Executive --- etor
_________________
Contact Person(s) : Kenneth J. Henderson/John Hoe er Phone: 5081
Project Area(s) : _Central City North (CCN) Ward(s) : One(1)
Supporting Data Attached: Staff Report
FUNDING REQUIREMENTS: Amount: $ N/A Source: N/A
Budget Authority: N/A
__-___________________________________________________________________________
Commission/Council Notes:
KJH:,'BH:lag:Skadron.CDC COMMISSION MEETING AGENDA
Meeting Date: 04/19/1993
Agenda Item Number:
i 0 r
D E V L O P M E N T D E P A R T M E N T
OF THE CITY OF SAN BERNARDINO
STAFF REPORT
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Skadron Loan Extension Request
On October 30, 1992, the Agency issued a loan to Mr. Erwin Skadron to
facilitate demolition of a site located on the northeast corner of Fourth and
"H" Streets. The demolition was carried out but buyers for the property have
not been located and sale of the land is not likely in the near future. Mr.
Skadron has requested an extension of his loan for an additional two (2)
years, and he has asked that his interest rate be reduced from 99 to 78.
Staff has reviewed the request and believes that it would be appropriate to
grant the request.
BACKGROUND
The Community Development Commission has approved the loan to Mr. Skadron to
assist in the demolition of buildings which were costly to demolish due to the
presence of asbestos. The demolition was carried out and the property has
been offered for sale by two commercial real estate companies, albeit without
success. In fact, Mr. Skadron reports that despite his efforts he has failed
to attract a single request at any price. The loan amount was $69,500 at 98
interest (payments are interest only) . Under the current provisions the loan
will expire on October 30, 1994.
EXTEKSION REQUEST
The interest rate is now considerably above market and it appears entirely
�^ possible that the property may not be sold by the end of its term. Therefore,
r Mr. Skadron has forwarded a request that we amend the terms of his loan to
lower the interest rate to 7% and to extend the term for twenty-four (24)
_ months to end on October 30, 1996. The note will be paid in any case if the
property is sold.
RECO64ENDATION
Mr. Skadron has completed the demolition of the blighted property and
diligently marketed his property. There have not been buyers for the property
due to general market conditions, and during this time there has been a
reduction of interest rates, It is, therefore, appropriate to adjust the
terms of his loan. On April 8, 1993, the Redevelopment Committee met and
considered this matter. The Committee voted to recommend that the Commission
apprave an amendment Mr. Skadron's loan.
Staff
� recommends adoption of the form motion.
t �A 41
KENNETH J. NDERSON, Executive Director
Development Tepartment
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1 KJH:JBH:lag:Skadron.CDc COFI+IISSION MEETING AGENDA
'1 Meeting Date: 04/19/1993
Agenda Item Number: 2