12-05-11 Community & Economic Development Committee

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COMMUNITY AND ECONOMIC DEVELOPMENT DECEMBER 5, 2011 Community and Economic Development Committee Members Present: Chairperson Tim Rouse; Henry Davis; Karen White Other Councilmember's Present: Derek Dieter; David Varner Other's Present: Rich Hill; Andrew Nemeth; Kevin Allen; Kathleen Cekanski - Farrand; Mayor Stephen Luecke; Mr. Satish "Sunny" Gabhawala; Mark McDonnel; Linda Wolfson; Dan lanello Agenda: Update on Chase Tower Resolution No. 4127 -11 Chairperson Rouse opened the meeting notice a quorum of the committee was present as well as Councilmember's Varner and Dieter. After briefly describing the purpose of the meeting Chairperson Rouse called upon Vice - Chairperson Henry Davis to further elaborate on the purpose and intent of the resolution adopted by the Council on November 14, 2011, by a vote of 7 -2. Mr. Davis explained the resolution was aimed at attracting and leveraging financial incentives for the potential rehabilitation of the Chase Tower. Mr. Davis said it was important to keep the Chase open and viable. To that end, Mr. Davis said he had met with a private developer in hopes of developing a public - private partnership to save the Chase. Mr. Davis underlined the importance of the commitment of public dollars citing both symbolic and actual economic multiplier benefits. Chairperson Rouse then asked the Mayor to come to the table. The Mayor said there have been discussions among his office, the investor represented by Baker Daniels, and the developer /broker Andrew Nemeth. The Mayor called the ongoing discussions a process of discovery. Specific criteria needs to be met when using public dollars to protect and insure the public interest. He said they are close to satisfying this criteria. He noted that because of imminent foreclosure, deadlines had to be set and met. The Council Attorney Kathleen Cekanski- Farrand would work with the City Clerk's Office to see that legalities of the process were met. The Mayor said an appropriation bill would be filed for 1" reading on December 12, 2011 and a special meeting for 2" and 3`d reading would be called for December 19, 2011. Either the Mayor of Five Councilmember's could issue a call for this special meeting. Moving to questions from the committee, Councilmember White asked from where the money would come? The Mayor said from general fund reserves. Councilmember Dieter asked what the $5.7 million was for and what do we get in return? In response, Mr. Satish "Sunny" Gabhawala aided by Rich Hill said the total investment was $19 million. $11 million would be used for parking garage /office improvements. The city would get a 99 year leasehold interest in the garage and would also get assurance of a mid -upper level hotel, for 10 years. Mr. Satish "Sunny" Gabhawala said through Mr. Hill that he would commit to $1.5 million in emergency elevator repairs. Councilmember White asked the status of the 22 tenants in the bldg. Andrew Nemeth said he would provide more tenant information.