Title
Approving a Settlement Agreement between 883FrontAvenue, LLC and the City with respect to the 2020 STAR award for the project located at 883 Front Avenue (District 6, Ward 5).
Body
WHEREAS, on September 2, 2020, the Saint Paul City Council authorized the City of Saint Paul (the “City) to make a loan of up to $37,500 and provide a grant of up to $37,500 to 883FrontAvenue, LLC, as part of Res. # 20-1141, for the build-out of the project referred to as Sacred Grounds Community Coffee Shop located at 883 Front Avenue, Saint Paul, MN 55103 (“STAR Award”); and
WHEREAS, an agreement for the STAR Award with the beginning effective date of October 1, 2020, was executed by 883FrontAvenue, LLC and the City (“the Parties”), which included, among other things, a Loan Agreement, Promissory Note, STAR Combination Mortgage, and STAR Assignment of Rents and Leases (collectively, “STAR Agreement”); and
WHEREAS, three disbursements were made from November 2020 through February 2021, totaling $59,223.68, consisting of loan funds of $29,611.84 and grant funds of $29,611.84; and
WHEREAS, pursuant to the STAR Agreement, 883FrontAvenue, LLC is required to make monthly payments of $798.79 commencing on October 1, 2021, and continuing through November 1, 2025, at which time the full amount of principal of the STAR loan plus accrued interest is due and payable; and
WHEREAS, the City received loan payments totaling $13,579.43, with the last payment received arriving in February 2023; and
WHEREAS, on October 6, 2023, the property at 883 Front Ave was transferred to K&G Holdings, LLC; and
WHEREAS, the lapse in loan payments in addition to the property having been sold to a different business entity without the knowledge or consent of the City put the STAR Agreement in default; and
WHEREAS, on March 20, 2024, the City sent official notice of the default to 883FrontAvenue, LLC and demanded payment of the outstanding principal of the STAR loan and accrued interest, then tot...
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