The Fort Wayne Redevelopment Commission approved Monday an amendment to the city's economic development agreement with RTM Ventures, the firm developing the Electric Works site just south of downtown.
The recent government shutdown was the reason for the amendment, which extends key deadlines. The developer must now have its financing commitments solidified by July 1 and the final fund closing conditions met by Sept. 1. Those deadlines were previously Dec. 31, 2018, and June 30, respectively.
The city and RTM Ventures signed the economic development agreement in August. The city's investment is about $62 million of the $248 million total cost for the project's first phase.
“We identified the need, the justification to extend the deadlines accordingly,” Redevelopment Director Nancy Townsend said.
City Councilman Jason Arp was the only Redevelopment Commission member to vote against the deadline extensions.
In a new addition to the agreement, the fund closing date, or the date when all the financing, tax credits and public investment must come together, is now Nov. 30. There is also a new requirement that the developer provide monthly written updates to city staff.
“The satisfaction of those (Sept. 1) conditions doesn't mean we're ready to close necessarily, so we added that extra buffer on the outside, so that hopefully the conditions are completed by Sept. 1 and we're able to close on or before Nov. 30,” said Jon Bomberger, an attorney with Faegre Baker Daniels representing the city.
Although the government shutdown did not affect the financing and lease commitment benchmarks that originally needed to be met by Dec. 31, the shutdown did affect the timeline for federal historic preservation and New Markets Tax Credits, which are necessary for the completion of the project.
“The New Markets Tax Credits, which we were expecting to come out from the (U.S.) Treasury probably late February, early March was also delayed,” Kevan Biggs of RTM Ventures told the commission. “The guidance on the New Markets program was that it would be issued in the spring, which is a pretty broad range.”
Biggs added that when the federal shutdown began on Dec. 22, RTM Ventures was putting together the necessary information to meet the Dec. 31 deadline.
“There were a few items out of the long list of requirements at the end of December that were going to be a challenge to achieve,” Biggs said. “But I think you would agree we had the vast majority of all those benchmarks satisfied around the end of December.”
Biggs said his team has a meeting this month with the state's historic preservation office to get final guidance regarding what can and can't be done physically with the property, which is holding up the developers' construction designs.
Biggs added that his firm had given the city early notice that a problem would be coming regarding the tax credits and plans to do so again should further issues arise.
“We really can't cut loose our construction drawing design team until that guidance comes from the federal government,” Biggs said. “We do feel comfortable with the Sept. 1 deadline for those two milestones.”