03-22-99 Community & Economic Development

Home Browse Search

Comintttts Zeport: Community and Economic Development Committee �0 tbjs common frontal of he E ttv of ioutUj :0: The March 22, 1999 meeting of the Community and Economic Development Committee was called to order by its Chairperson, Council Member Roland Kelly at 4:31p.m. in the Council informal meeting room. Persons in attendance included Council Members: Aranowski, Kelly, Pfeifer, King, Varner, Ujdak, Sniadecki, and Coleman; Mayor Stephen Luecke, Nancy Van Scoyk, Robert Hunt, Jean Troutman-Poole, Terry Bland, Elizabeth Leonard, Eugenia Schwartz, Jon Hunt, Rhonda Brown, John Humphrey, Richard Hill, Ken Fedder, and Kathleen Cekanski-Farrand. Council Member Kelly noted that the first item on the agenda was to review Bill No. 21-99 which would approve a lease for certain public improvements between the South Bend Redevelopment Authority and the South Bend Redevelopment Commission, and would authorize the use of EDIT revenues by the Commission for the payment of rentals. Beth Leonard made the presentation. She noted that the Council authorized the application for § 108 Loan Funds in November of 1997. However because these§ 108 loan funds are now being repaid with EDIT and TIF revenues and NOT Community Development Block Grant Funds (CDBG), Common Council action is required for the repayment of the § 108 loan. A total of$ 600,000 of the § 108 loan will be paid through CDBG funds and the remaining$ 1.8 million will be repaid through the use of EDIT and TIF funds. The monies will be used for land assembly, development of a new downtown office complex, and the Studebaker Museum. Ms. Leonard noted that since HUD required additional security for the repayment of the§ 108 loans, the City of South Bend hired Baker and Daniels to prepare the proper legal documents. Richard Hill of Baker Daniels noted that if the pledge is provided in the wrong way, it would be considered a city debt. The city does not want to recommit TIF where it was already committed. Dr. Varner requested further explanation of the relationship between the Redevelopment Authority and the Redevelopment Commission on this matter. Mr. Hill noted that that Indiana Supreme Court has ruled that improperly pledged EDIT would result as a general obligation of the City. For example, a lease arrangement is NOT considered a debt to the city. He then briefly explained an informal pledge of TIF vs. a formal pledge of TIF. The overall goal is to not make TIF funds unavailable for existing commitments. Ms. Leonard noted that interest would be due before the project is completed. Council Member King question § 3 of Bill No. 21-99 where"unavailable" is used three(3) times in the same sentence and found it to be confusing. Mr. Hill recommended that the language stand as proposed. Dr. Varner requested information on the sum total of the payments. Mr. Hill noted that the annual amount per the schedule would constitute that amount.