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City and HRA approve extra funding, loan and bonds to repair Heights condominium parking structure
Summary
The council and HRA approved a development agreement, an increased interfund loan and the issuance of housing‑improvement bonds to help finance a rehabilitation of a condemned condominium parking structure after cost increases; the project will proceed subject to prerequisites and repayment terms.
Bloomington city staff, the Housing and Redevelopment Authority and the Heights Condominium Association won council approval on a funding package to move forward with a major rehabilitation of a failing parking structure. The HRA increased its interfund loan to accommodate higher construction estimates, and the council adopted a development agreement, authorized the interfund loan and approved the issuance of taxable general obligation housing‑improvement area (HIA) bonds.
Why it matters: The Heights Condominium Association applied for Housing Improvement Area (HIA) financing to repair a parking structure that has deteriorated and that building inspectors and structural engineers identified as needing immediate work. The HIA is a statutory tool to finance repairs assessed to benefiting properties; the HRA and council approvals permit the association to borrow on a secured basis and repay via HIA assessments.
Changes and staff findings: The project experienced construction cost increases driven by continued deterioration since the original application, identified additional balconies that require repair and by inflation and tariffs. The HRA increased the principal amount of an interfund loan by $350,000 (including $292,606 for increased construction costs and $57,394 to reimburse administrative expenses already incurred). The HRA agreed to reduce the interfund loan interest rate so that assessed owners’ homeowners assessments remain unchanged from the originally approved HIA assessment (except for owners who prepaid and agreed in writing to the change).
Council and HRA actions: The HRA approved the revised financing at its August 12 meeting. The council on Aug. 25 adopted the development agreement (motion by Council member D’Alessandro, second Rivas; vote 7–0), authorized the interfund loan (motion by D’Alessandro, second Rivas; vote 7–0) and authorized issuance and sale of taxable general‑obligation HIA bonds up to the proposed principal amount (motion by D’Alessandro, second Rivas; vote 7–0). Staff will advertise a negotiated bond sale and return with an award for council approval; prerequisites for drawing funds include approved construction plans, a construction contract and certified project cost statements.
Ending: Demolition can begin this fall, according to the project team, and full garage reconstruction is scheduled for 2026; staff and the HRA included a 5% contingency in the revised budget and required audited financial reporting and an increased replacement reserve as conditions in the development agreement.
