TRUCKEE, Calif. and#8212; In an effort to avoid unforeseen complications with the town's soon-to-be-dissolved redevelopment agency, Truckee Town Council last week reiterated a promise to contribute $1.5 million to the Hotel Avery development.
At last Thursday's meeting, town council gave staff the OK to enter into a memorandum of agreement with JMA Ventures, the hotel's developer. The memorandum reassures JMA of the town's intention to provide a grant of $1 million and a loan of $500,000 for the project, with the funds coming from the town's redevelopment agency.
The money will be used to build sidewalks, create river access points, reroute infrastructure and install other public access and use facilities.
The memorandum comes shortly before redevelopment agencies across the state will be abolished on Feb. 1 as a part of Gov. Jerry Brown's controversial budget redistribution measures. The decision is causing a genera sense of uncertainty among the redevelopment arena.
According to a story in Wednesday's Sun, while the state has prescribed a loose plan for dismantling the agencies, Town Attorney Dennis Crabb said the process is in constant flux, and it's unclear what the future holds for redevelopment funds.
If redevelopment funds are available and financing proceeds as planned, JMA Ventures will repay the $500,000 loan over time by collecting a 2 percent fee added to the nightly room rate at the hotel. The town will recoup grant money at an estimated rate of $170,000 a year through property taxes imposed on the hotel.
Should redevelopment funds become inaccessible, the town will be able to fulfill the agreement through alternative avenues, staff said.
However, until JMA can assure completion of the hotel, the town will not distribute any funds, said Town Manager Tony Lashbrook.
JMA Executive Vice President David Tirman said the company is currently discussing construction financing with local banks. He said he hopes to have a resolution within the next few months and have the project shovel-ready by early fall.