On Monday the Council will be getting some of the details on the Hesperia Land Development Project.Agenda Package - 17.3MB (P.96-103)This will be a Council decision that will not be subject to public input as to the Partnering Agreement that has been approved by the City and their 100% owned subsidiary The Hesperia Development Company. (This 'new'
company apparently is the old Vernon Land Corps shell that was dusted off after being dissolved on Jan 1, 2007 and renamed.)----------------
What is the taxpayers cost or subsidy to provide a potential 1000 units of mixed used housing on 69 acres of which some (Not yet revealed) will be attainable, sustainable housing on this site?
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- It appears that the City will sell 69 acres for $3,000,000 to Hesperia and this will be a note payable to the City that will be paid in 2013. (Cash Flow statement).
- It appears that the City will receive $19,578,000 in dividends from Hesperia . ($2,000,000 in 2013, $8,000,000 in 2014, and balance $9,578,000 in 2015)
- This project will be fully funded by a line of credit from the City that will see a total of $12,993,000 drawn by Hesperia Corp during the 2008-2012 period with final repayment plus interest in June of 2012.
Basically the taxpayer of the City will receive a total of $22,578,000 ($19,578,000 in 'dividends' and $3,000,000 for Land). (Present value of this deal in 2008 $'s is $19,970,649). (Dividend present value at 2% is $17,253,457 at 3% is $16,212,881 Land Present value at 2% is 2,717,192 at 3% is 2,587,826.)
The taxpayers are giving up 69 acres of land which the City applied to have removed from the ALR in 2005, (a request which was authorized as the lands had been approved for development prior to the lands being taken into the ALR). ('The City has transferred the Land to Hesperia for $3,000,000, being fair market value according to a certified appraisal" {04/14/08} ).
To get to the subsidy that the taxpayers will be paying for an unknown number of units of attainable housing we must have the cost of this property if it was rezoned to the same levels that it will be rezoned for Hesperia and the property sold on the open market to Private Developers. What is 69 acres worth on the open market?
When this subsidy is determined we will then be in the position to decide if the subsidy is justified.
Please feel free to comment on this posting. What is 69m acres worth on the open market?
1 comment:
What are the Safeguards against the board members from profiting directly or indirectly from this Taxpayer funded initiative
This a question that needs to be answered since the board members are in Real Estate and development!
Who chose the directors and on what basis
Why Real estate people??
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