CDA accepts $200,000 management‑fee buyout, reduces ongoing fee to 5%

The Community Development Authority voted to approve an amendment to a property management agreement that provides the CDA with a one‑time cash payment of $200,000 and prepayment of roughly $180,000 in seller‑financed interest. In exchange, the management fee would be reset to 5% of gross revenue, which staff estimated equates to about an additional $1,700 per month in fee revenue because of the invested prepayment.

Staff framed the amendment as "a prepayment of all those as well as $200,000, which is essentially a forward‑looking buy down of all of our management fees," and said the arrangement included prepayment of interest payments on seller financing tied to the property's sale. The board moved, seconded and approved the amendment by voice vote. Staff said the amendment preserves a revenue stream for CDA while providing an immediate cash infusion.

Board members asked about the contract term and termination clauses; staff noted the agreement includes a term tied to either a three‑year period or 30 days after receiving a certificate of occupancy, and either party may terminate with 120 days' notice. The CDA approved the amendment and staff will implement the contract changes.