Loading...
HomeMy WebLinkAbout01-15-10 Redevelopment Commission Minutes SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING January 15, 2010 10:00 a.m. 227 West Jefferson Boulevard Presiding: Marcia I. Jones, President South Bend, Indiana 1. ROLL CALL Members Present: Ms. Marcia Jones, President Dr. David Varner, Vice President Ms. Nancy King, Secretary Mr. Greg Downes Mr. Donald Alford Ms. Stephanie Spivey Legal Counsel: Mr. Lawrence Meteiver, Esq. Redevelopment Staff: Mr. Don Inks, Director Mrs. Cheryl Phipps, Recording Secretary Mr. Bill Schalliol, Economic Development Specialist Mr. Robert Mathia, Economic Development Specialist Mr. David Relos, Economic Development Specialist Ms. Ann Kolata, Economic Development Specialist Ms. Debrah Jennings, Property Manager Others Present: Mr. Tom Price, Mayor’s Office Mr. Gregg Zientara, City Controller Ms. Beth Leonard, Community & Economic Dev. Ms. Rita Kopala Ms. GlendaRae Hernandez Ms. Jamie Ruiz, CB Richard Ellis Mr. Tim Firestone, Kitson & Partners Golf Mr. John Quickstad, Blackthorn Golf Club Mr. Greg Pink Ms. Mo Miller, Prism Science Ms. Amber Zebell, Prism Science Mr. Jim Williams, Habitat for Humanity Ms. Vivian Bolen, Habitat for Humanity Mr. Chris Garber, Habitat for Humanity Mr. Jeff Parrott, South Bend Tribune Ms. Oletha Jones Mr. Terry Selich, Endeavor Mr. Jim Duszynski, Endeavor South Bend Redevelopment Commission Regular Meeting –January 15, 2010 2. APPROVAL OF MINUTES A. Approval of Minutes of the Regular Meeting of Friday, December 18, 2009. CM Upon a motion by Mr. Downes, seconded by Mr. OMMISSION APPROVED THE INUTES OF THE RMF,D EGULAR EETING OF RIDAY ECEMBER Varner and unanimously carried, the Commission 18,2009 approved the Minutes of the Regular Meeting of Friday, December 18, 2009. B. Approval of Minutes of the Annual Organizational Meeting of Monday, January 4, 2010. CM Upon a motion by Mr. Downes, seconded by Mr. OMMISSION APPROVED THE INUTES OF THE AOM NNUAL RGANIZATIONAL EETING OF Varner and unanimously carried, the Commission M,J4,2010 ONDAY ANUARY approved the Minutes of the Annual Organizational Meeting of Monday, January 4, 2010. 6. NEW BUSINESS Mr. Inks asked to move items 6.D.(2) and 6.F.(1) to the top of the agenda. There was no objection and the items were so moved. D. Airport Economic Development Area (2) Authorization to begin the process to amend the Airport Economic Development Area Development Plan. Mr. Schalliol noted that under the new state statute governing TIF areas, the Commission must direct staff to prepare appropriate documentation to amend a development plan. In the case of an amendment to the plan of an existing redevelopment area, the Commission must determine that the amendment is reasonable and appropriate in relation to the original development plan and that the proposed amendment conforms to the comprehensive plan. Following that determination, the Commission must direct 2 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) D. Airport Economic Development Area (2) continued… staff to prepare maps and plats showing the boundaries to be affected by the amendment, the location of parcels, streets, alleys, that would be affected by the acquisition, clearance, rezoning, etc., and the owners of the parcels proposed to be acquired. Area 1: Ignition Park South The Commission recently approved acquisition of some properties in an area staff is calling Ignition Park South, along Indiana Avenue from Taylor to Prairie. Many properties in this area are in various states of distress and staff would like to continue to acquire vacant or abandoned properties within this corridor, including some on tax sale. Additionally, staff would add to the acquisition list the properties acquired from the Burton family and occupied by Waste Management. Those properties are now owned by the City of South Bend. Area 2: Ignition Park West – Prairie Avenue to Walnut Street As staff has worked to develop a plan concept for the areas to the east and south of Ignition Park and has begun strategic acquisition of properties with non-consistent uses, staff requests authorization to examine the area west of Ignition Park and plan for future redevelopment needs in that area. A need for a plan west of the park became apparent when a wrecker service proposed reuse of a vacant parcel. A wrecker service might have been a reasonable use on Prairie Avenue in the past, but the proposed use with Ignition Park illustrates the need for a plan 3 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) D. Airport Economic Development Area (2) continued… for this area. Area 3: Gorny Plaza (1116 S. Main St) Gorny Plaza is located on the southeast corner of Stull and Main. It is presently listed for sale and would be a target acquisition to allow for redevelopment opportunities to advance and continue in that area between the Ignition Park campus and the Ivy Tech Campus. Staff requests authorization to prepare plans and maps and related information for Commission consideration of amending the development plan. C Upon a motion by Mr. Downes, seconded by OMMISSION DETERMINED THAT THE A PROPOSED AMENDMENT TO THE IRPORT Ms. King and unanimously carried, the EDA CONOMIC EVELOPMENT REA IS Commission determined that the proposed REASONABLE AND APPROPRIATE IN RELATION amendment to the Airport Economic TO THE ORIGINAL DEVELOPMENT PLAN AND Development Area is reasonable and THAT THE PROPOSED AMENDMENT CONFORMS .T appropriate in relation to the original TO THE COMPREHENSIVE PLAN HE C OMMISSION AUTHORIZED STAFF TO PREPARE development plan and that the proposed AND ASSEMBLE INFORMATION FOR amendment conforms to the comprehensive A CONSIDERATION OF AMENDING THE IRPORT plan. The Commission authorized staff to EDA CONOMIC EVELOPMENT REA prepare and assemble information for ACQUISITION LIST consideration of amending the Airport Economic Development Area acquisition list. F. South Side Development Area (1) Status report on Erskine Plaza pond project. Mr. Schalliol noted that the City of South Bend has become involved in a project to reclaim land currently used as a retention 4 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) F. South Side Development Area (1) continued… pond and develop the site for commercial development. The Erskine Plaza Pond Project is an outgrowth of development and infrastructure planning that will create a development parcel on Miami Street south of Ireland Road and help create new access into Erskine Plaza. The project will also improve the storm water management process in the Ireland-Miami area and will reduce overflow impacts on the existing storm water network and the Erskine Park Golf Course. The Erskine Plaza Pond Project started as a concept to remove the two drainage ponds within the Erskine Plaza commercial development to create new development sites and to relocate the storm water collection ponds into a controlled sequence of ponds and structures, through the Erskine Park Golf Course. The economics of the project never worked for the project but the need to create new sites and to resolve drainage issues persist. The project consists of removing the existing pond along Miami, reshaping and improving the existing interior pond, and creating a new pond at the southwest corner of Hawbaker and High Streets. Overflow from the pond will still be directed to the storm water system and the golf course, but the need to divert water should be minimized by the improved pond percolation and design of the systems. The reclaimed pond site will be filled and could become space for two new south side tenants. 5 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) F. South Side Development Area (1) continued… Mr. Varner asked who is responsible for High Street between the Menard’s parking lot and Ireland Road. It is in terrible shape. Mr. Schalliol responded that staff is trying to determine that. The Meridian Title contract on the ratification list at the end of the agenda looks for that information, among other information. 3. APPROVAL OF CLAIMS Redevelopment Commission Claims submitted January 15, 2010 for approval. 305 FUND SBCDA BOND Rieth Riley Construction Co 101 N Michigan St. 89,052.22 324 AIRPORT AEDA DLZ Expansion of Olive Rd & Pine 40,080.00 Indiana Michigan Power Sprinkler 501 Wenger St. 7.00 DLZ US 31 / Adams Rd 16,290.00 Ken Herceg Studebaker Corridor Study 500.00 DLZ US 31/Adams RD Interchange 36,010.00 420 FUND TIF DISTRICT-SBCDA GENERAL Ampco System Parking St. Joseph St Surface 1,058.76 Ampco System Parking 225 Main St. 1,009.77 Phifer Environmental Services LLC Professional Consulting Services 1,350.00 CB Richard Ellis 435 FUND DOUGLAS ROAD TIF SJVM Douglas Rd Conduit 35,608.00 Selge Construction Douglas Rd Added Travel Lanes 425,206.54 $ 185,357.75 CC Upon a motion by Mr. Downes, seconded by Mr. Varner OMMISSION APPROVED THE LAIMS J15,2010, SUBMITTED ANUARY AND ORDERED and unanimously carried, the Commission approved the THE CHECKS TO BE RELEASED Claims submitted January 15, 2010, and ordered checks to be released. 6 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 4. COMMUNICATIONS TC There were no Communications. HERE WERE NO OMMUNICATIONS 5. OLD BUSINESS A. Airport Economic Development Area (1) Operations and Management Agreement with Kitson & Partners Club Services. Mr. Inks noted that the terms of the contract with Kitson & Partners have not been finalized. The Commissioners received a draft version in their packets. Mr. Inks summarized the terms of the contract as they stand. The agreement appoints Kitson & Partners as manager of Blackthorn Golf Course. The objectives of the operations and management contract are to protect and maintain golf course facilities, manage daily course operations, provide financial accounting services, maximize course revenue and profit, and develop long range business strategy. The contract describes those services, local and corporate, including staffing. Kitson will prepare an annual business plan and operating budget each year. The city will open a new Operating Account to be maintained by Kitson. If the account reaches a negative balance, that would be cause for termination of the contract. The account and accounting procedures are being established based on advice from the city controller and they parallel the procedures in the Century Center Management Agreement, recently approved by the city. Kitson will prepare monthly financial statements. Insurance and indemnification issues are still being worked 7 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 5. OLD BUSINESS A. Airport Economic Development Area (1) continued… out. The city will provide casualty insurance and will self insure for liability. Kitson will provide various liability insurances. The term of the contract will be three years, with a two-year extension unless notice is given. If the contract is terminated without cause, Kitson will receive $40,000 if during the first year, $30,000 if during year two, and $20,000 during year three. Kitson will receive a monthly management fee of $8,000 and $2,000 per month for accounting. There is an incentive fee of 5% of the gain in gross revenue over the average 2009 and 2009 gross revenue (average is $1,520,000). This differs from the proposed incentive fee the Commission approved at the time it awarded the proposal because of the tax exempt bonds on the course. We aren’t allowed to tie incentive fees to net profits on the course. It meets legal requirements to tie it to gross revenue. There will also be a discretionary incentive fee of up to 25% of the incentive fee. It will be up to the Commission to establish evaluation criteria and determine whether any fee is appropriate in a given year. Reimbursable expenses are capped at $10,000 per year. A separate fee for strategic planning is $10,000, payable in two $5,000 installments, based on milestones being achieved. Minimum maintenance standards are included in the contract in Exhibit A; and operations policies are Exhibit B. 8 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 5. OLD BUSINESS A. Airport Economic Development Area (1) continued… Ms. Jones noted that she really wants Kitson to pay close attention to the capital expenditure situation in their long range planning so we avoid the touchy situation we had when the bunkers got really bad. Mr. Varner reiterated his belief that the future of Blackthorn Golf Course is in private hands. He’s anxious to see the results of the strategic planning. CO Upon a motion by Mr. Downes, seconded by OMMISSION APPROVED THE PERATIONS AND MAK& ANAGEMENT GREEMENT WITH ITSON Mr. Varner and unanimously carried, the PCS, ARTNERS LUB ERVICES SUBJECT TO REVIEW Commission approved the Operations and BY LEGAL COUNSEL AND THE CITY CONTROLLER Management Agreement with Kitson & Partners Club Services, subject to review by legal counsel and the city controller. 6. NEW BUSINESS (CONT.) A. Public Hearings and Commission action on appropriation resolutions. (1) Resolution No. 2619 appropriating Tax Increment Financing revenues from Allocation Area No. 1 Fund for the payment of certain obligations and expenses related to the Airport Economic Development Area Allocation Area No. 1 Mr. Inks presented information for all the TIF resolutions at this time. He noted that the public hearing file for Resolutions No. 2619, 2620, 2621, 2622, 2623, 2624, 2625, 2626 and 2627 is complete, containing the Notice of Hearing, copies of each 9 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) A. Public Hearings and Commission action on appropriation resolutions. (1) continued… resolution, and affidavits from the South Bend Tribune and Tri-County News that the notice was published in those newspapers on January 1, 2010. Mr. Inks noted that since the Commission is now doing multiple year strategies for the South Bend Central and Airport Economic Development Areas, we’re seeing projects rolling over from one year to the next. There are very few changes from one year to the next. He highlighted the changes for those two areas. In the AEDA, the strategic plan for the golf course has been added, renovation of the former Bureau of Housing facility on Eclipse Place to be a new animal shelter, a potential criminal correction facility in the Airport Industrial Park area needs an access road, and creating an overlay zone around Ignition Park. In the downtown, holding costs for the LaSalle Hotel have been around $20,000 per year. We have increased that to $60,000 in 2010 in an effort to clean out the hotel to make it more appealing to a developer. An elevator in the hotel also needs some repair. The budget contains $175,000 for the Hall of Fame as matching funds for an EDA matching grant that we will be seeking to study adaptive reuse. There is money in the SBCDA budget for Jefferson Street design for a potential project on the East Bank, and 10 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) A. Public Hearings and Commission action on appropriation resolutions. (1) continued… design and construction of a parking lot just west of WNIT at $100,000. In the West Washington-Chapin Development Area the only project is Hansel Center. In the Central Medical Services District there are public works projects surrounding Memorial hospital. We are also considering a brick façade on the Bartlett Street garage. There is no change from last year to the projects in the Northeast Development Area. There will only be about $60,000 and that will be used for plan implementation. He noted that we expect the TIF in this area to increase in upcoming years as the South Bend Clinic tax abatement ages. The significant project for the South Side Development Area is the reconfiguration of the retention ponds. In the TIF area for Lowes/Walmart, all the funds are reserved for debt service. We originally had 20 and 25 year bonds. We believe the TIF revenues now will allow us to pay those off in five years. In the TIF Area for Erskine Village, again, the project has gone very well. The revenues are much higher than we anticipated. We have an outstanding bond that we believe we can pay off in about five years and are 11 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) A. Public Hearings and Commission action on appropriation resolutions. (1) continued… dedicating all revenue to debt service. In the Douglas Road Development Area the projects anticipated for this area are complete. We are now in the process of reimbursing the City of South Bend for the public works that were done using city funds and paying back the loan from Mishawaka that was used for part of the project. The reimbursement to the City of South Bend and the City of Mishawaka loans carry 5% interest rates. We are making the scheduled payments on the City of South Bend reimbursement and dedicating all excess cash to repayment of the Mishawaka loan. Mr. Varner asked what projects in the AEDA will rise to the top of the list. Mr. Inks responded that the focus will be on getting Ignition Park squared away. The Commission has already authorized acquisition and demolition of more property to the south and east; demolition of the two remaining buildings on the Ignition Park site, SASCO and Underground Pipe & Valve; anything that seems appropriate at LaSalle Square; and possibly the designing the interchange for Portage Prairie and looking for additional funds to construct it. Mr. Varner asked about the status of the city’s 10-year contract for the Metronet, particularly TIF funds expended. He also wants to know when the city will begin to receive payback. Mr. Inks said he will try to 12 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) A. Public Hearings and Commission action on appropriation resolutions. (1) continued… have a status report by the February 5 meeting. PHRN.2619, Ms. Jones opened the public hearing on UBLIC EARING ON ESOLUTIONS O 2620,2621,2622,2623,2624,2625,2627 AND Resolutions No. 2619, 2620, 2621, 2622, 2623, 2624, 2625, and 2627 for whoever wished to speak. There was no one who wished to speak. Ms Jones closed the public hearing for whatever action the Commission wished to take. CRN.2619 Upon a motion by Mr. Downes, seconded by OMMISSION APPROVED ESOLUTION O TIF APPROPRIATING AX NCREMENT INANCING Mr. Alford and unanimously carried, the AAN.1 REVENUES FROM LLOCATION REA O Commission approved Resolution No. 2619 F UND FOR THE PAYMENT OF CERTAIN appropriating Tax Increment Financing OBLIGATIONS AND EXPENSES RELATED TO THE revenues from Allocation Area No. 1 Fund AEDA IRPORT CONOMIC EVELOPMENT REA AAN.1 for the payment of certain obligations and LLOCATION REA O expenses related to the Airport Economic Development Area Allocation Area No. 1 (2) Resolution No. 2620, an Additional Appropriation Resolution of the Redevelopment Commission (South Bend Central Development Area No.1 Fund) CRN.2620, Upon a motion by Mr. Downes, seconded by OMMISSION APPROVED ESOLUTION O AAR AN DDITIONAL PPROPRIATION ESOLUTION Mr. Alford and unanimously carried, the RC(S OF THE EDEVELOPMENT OMMISSION OUTH Commission approved Resolution No. 2620, BCDAN.1 END ENTRAL EVELOPMENT REA O an Additional Appropriation Resolution of F) UND the Redevelopment Commission (South Bend Central Development Area No.1 Fund) (3) Resolution No. 2621 appropriating Tax Increment Financing revenues from Allocation Area Fund for the Payment of 13 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) A. Public Hearings and Commission action on appropriation resolutions. (3) continued… Certain Obligations and expenses related to the West Washington-Chapin Development Area Allocation Area CRN.2621 Upon a motion by Mr. Downes, seconded by OMMISSION APPROVED ESOLUTION O TIF APPROPRIATING AX NCREMENT INANCING Mr. Alford and unanimously carried, the AAF REVENUES FROM LLOCATION REA UND FOR Commission approved Resolution No. 2621 PCO THE AYMENT OF ERTAIN BLIGATIONS AND appropriating Tax Increment Financing W EXPENSES RELATED TO THE EST revenues from Allocation Area Fund for the W-CDA ASHINGTONHAPIN EVELOPMENT REA AA Payment of Certain Obligations and expenses LLOCATION REA related to the West Washington-Chapin Development Area Allocation Area (4) Resolution No. 2622, an Additional Appropriation Resolution of the Redevelopment Commission (Downtown Medical Services District Special Fund) CRN.2622, Upon a motion by Mr. Downes, seconded by OMMISSION APPROVED ESOLUTION O AAR AN DDITIONAL PPROPRIATION ESOLUTION Mr. Alford and unanimously carried, the RC OF THE EDEVELOPMENT OMMISSION Commission approved Resolution No. 2622, (DMSD OWNTOWN EDICAL ERVICES ISTRICT an Additional Appropriation Resolution of SF) PECIAL UND the Redevelopment Commission (Downtown Medical Services District Special Fund) (5) Resolution No. 2623 appropriating tax increment financing revenues from Allocation Area Fund for the payment of certain obligations and expenses related to the Northeast Neighborhood Development Area Allocation Area CRN.2623 Upon a motion by Mr. Downes, seconded by OMMISSION APPROVED ESOLUTION O APPROPRIATING TAX INCREMENT FINANCING Mr. Alford and unanimously carried, the AAF REVENUES FROM LLOCATION REA UND FOR Commission approved Resolution No. 2623 THE PAYMENT OF CERTAIN OBLIGATIONS AND 14 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) A. Public Hearings and Commission action on appropriation resolutions. (5) continued… N appropriating tax increment financing EXPENSES RELATED TO THE ORTHEAST NDA EIGHBORHOOD EVELOPMENT REA revenues from Allocation Area Fund for the AA LLOCATION REA payment of certain obligations and expenses related to the Northeast Neighborhood Development Area Allocation Area. (6) Resolution No. 2624 appropriating tax increment financing revenues from Allocation Area No. 1 Fund for the payment of certain obligations and expenses related to the South Side Development Area Allocation Area No. 1 CRN.2624 Upon a motion by Mr. Downes, seconded by OMMISSION APPROVED ESOLUTION O APPROPRIATING TAX INCREMENT FINANCING Mr. Alford and unanimously carried, the AAN.1 REVENUES FROM LLOCATION REA O Commission approved Resolution No. 2624 F UND FOR THE PAYMENT OF CERTAIN appropriating tax increment financing OBLIGATIONS AND EXPENSES RELATED TO THE revenues from Allocation Area No. 1 Fund SSDAA OUTH IDE EVELOPMENT REA LLOCATION AN. 1 for the payment of certain obligations and REA O expenses related to the South Side Development Area Allocation Area No. 1 (7) Resolution No. 2625 appropriating tax increment financing revenues from Allocation Area No. 2 Fund for the payment of certain obligations and expenses related to the South Side Development Area Allocation Area No. 2 CRN.2625 Upon a motion by Mr. Downes, seconded by OMMISSION APPROVED ESOLUTION O APPROPRIATING TAX INCREMENT FINANCING Mr. Alford and unanimously carried, the AAN.2 REVENUES FROM LLOCATION REA O Commission approved Resolution No. 2625 F UND FOR THE PAYMENT OF CERTAIN appropriating tax increment financing OBLIGATIONS AND EXPENSES RELATED TO THE revenues from Allocation Area No. 2 Fund SSDAA OUTH IDE EVELOPMENT REA LLOCATION AN. 2 for the payment of certain obligations and REA O 15 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) A. Public Hearings and Commission action on appropriation resolutions. (7) continued… expenses related to the South Side Development Area Allocation Area No. 2 (8) Resolution No. 2626 appropriating tax increment financing revenues from Allocation Area No. 3 Fund for the payment of certain obligations and expenses related to the South Side Development Area Allocation Area No. 3 CRN.2626 Upon a motion by Mr. Downes, seconded by OMMISSION APPROVED ESOLUTION O APPROPRIATING TAX INCREMENT FINANCING Mr. Alford and unanimously carried, the AAN.3 REVENUES FROM LLOCATION REA O Commission approved Resolution No. 2626 F UND FOR THE PAYMENT OF CERTAIN appropriating tax increment financing OBLIGATIONS AND EXPENSES RELATED TO THE revenues from Allocation Area No. 3 Fund SSDAA OUTH IDE EVELOPMENT REA LLOCATION AN. 3 for the payment of certain obligations and REA O expenses related to the South Side Development Area Allocation Area No. 3 (9) Resolution No. 2627 appropriating Tax Increment Financing revenues from Allocation Area No. 1 Fund for the payment of certain obligations and expenses related to the Douglas Road Economic Development Area Allocation Area No. 1 CRN.2627 Upon a motion by Mr. Downes, seconded by OMMISSION APPROVED ESOLUTION O TIF APPROPRIATING AX NCREMENT INANCING Mr. Alford and unanimously carried, the AAN.1 REVENUES FROM LLOCATION REA O Commission approved Resolution No. 2627 F UND FOR THE PAYMENT OF CERTAIN appropriating Tax Increment Financing OBLIGATIONS AND EXPENSES RELATED TO THE revenues from Allocation Area No. 1 Fund DRED OUGLAS OAD CONOMIC EVELOPMENT AAAN.1 for the payment of certain obligations and REA LLOCATION REA O expenses related to the Douglas Road Economic Development Area Allocation Area No. 1 16 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) A. Public Hearings and Commission action on appropriation resolutions. (10) Resolution No. 2628 appropriating monies for the purpose of defraying the expenses of certain local public improvements for the fiscal year beginning January 1, 2010, and ending December 31, 2010 including all outstanding claims and obligations, fixing a time when the same shall take effect (Fund 619, Blackthorn Golf Course) Mr. Inks noted that the public hearing file is complete, containing the Notice of Hearing, a copy of Resolution No. 2628, and affidavits from the South Bend Tribune and Tri-County News that the notice was published in those newspapers on January 1, 2010. Mr. Inks noted that the budget for 2010 is much the same as it was for 2009. The total budget is $1,518,000 for 2010, down from $1,546,000 in 2009. Mr. Varner asked whether all the management fee is represented in this budget. Mr. Inks responded that the only portion of the management fee that is not part of this budget is the $10,000 consulting fee for strategic planning, which will be paid from TIF funds. PHRN.2628 Ms. Jones opened the public hearing for UBLIC EARING ON ESOLUTION O whoever wished to speak regarding Resolution No. 2628. There was no one who wished to speak. Ms. Jones closed the public hearing for whatever action the Commission wished to take. 17 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) A. Public Hearings and Commission action on appropriation resolutions. (10) continued… CRN.2628 Upon a motion by Ms. King, seconded by OMMISSION APPROVED ESOLUTION O APPROPRIATING MONIES FOR THE PURPOSE OF Mr. Downes and unanimously carried, the DEFRAYING THE EXPENSES OF CERTAIN LOCAL Commission approved Resolution No. 2628 PUBLIC IMPROVEMENTS FOR THE FISCAL YEAR appropriating monies for the purpose of J1,2010, BEGINNING ANUARY AND ENDING defraying the expenses of certain local public D 31,2010 ECEMBER INCLUDING ALL , improvements for the fiscal year beginning OUTSTANDING CLAIMS AND OBLIGATIONS FIXING A TIME WHEN THE SAME SHALL TAKE January 1, 2010, and ending December 31, (F619,BG EFFECT UND LACKTHORN OLF 2010 including all outstanding claims and C) OURSE obligations, fixing a time when the same shall take effect (Fund 619, Blackthorn Golf Course) (11) Resolution No. 2629 appropriating monies for the purpose of defraying the expenses of certain local public improvements for the fiscal year beginning January 1, 2010, and ending December 31, 2010, including all outstanding claims and obligations, fixing a time when the same shall take effect. (Fund 425, Leighton Retail Space and Courtyard and Wayne St Garage Retail) Mr. Inks noted that the public hearing file is complete, containing the Notice of Hearing, a copy of Resolution No. 2629, and affidavits from the South Bend Tribune and Tri-County News that the notice was published in those newspapers on January 1, 2010. Mr. Inks noted that the 2010 budget totals $142,000, down from $163,000 in 2009. Part of the reason for that drop is that we’ve had a $20,000 reserve fund in previous years to cover unexpected needs. The 2010 budget 18 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) A. Public Hearings and Commission action on appropriation resolutions. (11) continued… does not include that reserve fund. PHRN.2629 Ms. Jones opened the public hearing for UBLIC EARING ON ESOLUTION O whoever wished to speak regarding Resolution No. 2629. There was no one who wished to speak. Ms. Jones closed the public hearing for whatever action the Commission wished to take. Mr. Downes asked about the difference between allocations for taxes in 2009 and 2010. Ms. Ruiz responded that due to the timing of the tax bills in 2009, the 2009 amount was two years’ worth of taxes. CRN.2629 Upon a motion by Mr. Downes, seconded by OMMISSION APPROVED ESOLUTION O APPROPRIATING MONIES FOR THE PURPOSE OF Mr. Varner and unanimously carried, the DEFRAYING THE EXPENSES OF CERTAIN LOCAL Commission approved Resolution No. 2629 PUBLIC IMPROVEMENTS FOR THE FISCAL YEAR appropriating monies for the purpose of J1,2010, BEGINNING ANUARY AND ENDING defraying the expenses of certain local public D 31,2010, ECEMBER INCLUDING ALL , improvements for the fiscal year beginning OUTSTANDING CLAIMS AND OBLIGATIONS FIXING A TIME WHEN THE SAME SHALL TAKE January 1, 2010, and ending December 31, .(F425,LRS EFFECT UND EIGHTON ETAIL PACE 2010, including all outstanding claims and CWSG AND OURTYARD AND AYNE T ARAGE obligations, fixing a time when the same R) ETAIL shall take effect. (Fund 425, Leighton Retail Space and Courtyard and Wayne St Garage Retail) B. Tax Abatements (1) Resolution No. 2643 approving an application for personal property tax deduction for property in the South Bend Central Development Area (Endeavor Machined Products Inc., 850 S Marietta St.) 19 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) B. Tax Abatements (1) continued… Mr. Mathia gave the staff report on the project. Endeavor Machined Products, Inc. is a start-up company that plans to begin production in the near future. They will manufacture precision machined parts for the wind power, petroleum exploration, aerospace and orthopedic industries. The equipment the company intends to procure will be used to manufacture prototype parts to demonstrate their design and production integrity in order to eventually release them for production. The company will fabricate the parts based on their clients’ designs. The equipment to be purchased includes a CNC five axis machining center, a CNC lathe, coordinate measuring machine, general shop equipment, software, computers, office furniture, inspection equipment, a fork lift and an air compressor. The total cost of the equipment is estimated to be $437,500. Total taxes to be abated during the five-year abatement period are estimated at $17,618. Total additional taxes to be paid as a result of the project during the five-year abatement period are estimated at $12,493. It is estimated that the project will create five new, permanent full-time positions with an annual payroll $205,021. Endeavor Machined Products has not been granted or associated with any previous tax abatements. The property is properly zoned for the proposed project. The property is 20 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) B. Tax Abatements (1) continued… located in the South Bend Central Development Area, which is a Tax Incremental Allocation Area; therefore, the petition for personal property tax deduction must first be approved by the South Bend Redevelopment Commission. The project meets the qualifications for a five-year personal property tax abatement under the tax abatement ordinance. Ms. Jones asked what kinds of positions will be created. She wondered if some would be design jobs. Mr. Duszynski responded that they will be everything from set up and operating this equipment to people who drive a truck or sweep the floor. Their company will not do any design. The jobs come to them already designed. Mr. Varner asked if they have a client base already established. Mr. Duszynski responded that they have been in contact with several customers who are anxious for them to be up and running. CRN.2643 Upon a motion by Mr. Downes, seconded by OMMISSION APPROVED ESOLUTION O APPROVING AN APPLICATION FOR PERSONAL Ms. King and unanimously carried, the PROPERTY TAX DEDUCTION FOR PROPERTY IN Commission approved Resolution No. 2643 SBCD THE OUTH END ENTRAL EVELOPMENT approving an application for personal A(EMPI., REA NDEAVOR ACHINED RODUCTS NC property tax deduction for property in the 850SMS.) ARIETTA T South Bend Central Development Area (Endeavor Machined Products Inc., 850 S Marietta St.) 21 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) C. South Bend Central Development Area (1) Contract with Schindler Elevator for elevator repairs and certification. (LaSalle Hotel) Mr. Relos noted that the LaSalle Hotel is currently being marketed to developers. In an effort show it better and for safety reasons, staff has solicited a proposal from Schindler Elevator to inspect and repair the freight elevator. The freight elevator is one of three elevators in the building, and the only one that is at all operational. Schindler was chosen because they have worked on the hotel’s elevators in the past. It was noted at a site visit with Schindler that many of the elevator doors on each floor are in poor condition, and that on certain floors the door arm locks could stick, causing the door to be left open yet the elevator operational – meaning the door could be left open to an empty elevator shaft. In addition to doing each floor’s elevator door maintenance, the attached proposal includes the required 5-year Traction Safety Test, which among other things, tests the elevator’s load and braking capacity. The proposal is in the amount of $8,330. Staff requests approval for a not to exceed amount of $10,000, to allow for additional work that may be uncovered during inspection and testing. C Upon a motion by Mr. Varner, seconded by OMMISSION APPROVED THE CONTRACT WITH SE CHINDLER LEVATOR FOR ELEVATOR REPAIRS Mr. Downes and unanimously carried, the AND CERTIFICATION IN AN AMOUNT NOT TO Commission approved the contract with $10,000(LSH) EXCEED AALLE OTEL Schindler Elevator for elevator repairs and certification in an amount not to exceed $10,000. (LaSalle Hotel) 22 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) C. South Bend Central Development Area (2) Contract with CB Richard Ellis for cleanout of the LaSalle Hotel. Mr. Relos noted that staff feels it would be helpful if the hotel were cleared of all debris and furniture that have cluttered it for years. Staff has walked the hotel with three vendors, who in turn submitted proposals for the hotel’s cleanout. The low bidder was CB Richard Ellis, whose proposal came in at $36,975. Staff requests approval for a not to exceed amount of $40,000, in case additional work is uncovered during the clean out. This proposal includes all 9 floors and certain areas of the basement of the hotel. Ms. King asked if there were useful things in the hotel. Mr. Relos responded that staff will identify some things that are not to be disposed of: Church pews, some pictures from when the hotel was in operation, 30-40 matching dining room chairs that are in good condition. There are other things that might be able to be used, but the cost would increase to haul it out and distribute it. C Upon a motion by Mr. Varner, seconded by OMMISSION APPROVED THE CONTRACT WITH CBRE ICHARD LLIS FOR CLEANOUT OF THE Mr. Downes and unanimously carried, the LSH AALLE OTEL IN AN AMOUNT NOT TO EXCEED Commission approved the contract with CB $40,000 Richard Ellis for cleanout of the LaSalle Hotel in an amount not to exceed $40,000. D. Airport Economic Development Area (1) Resolution No. 2644 approving and accepting a counter offer for the acquisition of property in the Airport Economic Development Area (Habitat for Humanity, 412 E. Sample St) 23 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) D. Airport Economic Development Area (1) continued… Mr. Relos noted that 412 E. Sample Street was added to the Airport Economic Development Area Acquisition List by Resolution No. 2596 on August 26, 2009. It was added in an effort to help Ivy Tech expand classroom, storage, and parking resulting from increased enrollment. On October 2, 2009, the Commission approved Resolution No. 2605, which set the offering price for 412 E. Sample at $272,000, which is the average value as determined by two independent appraisals. This property has an 8,500 square foot building on approximately 1.32 acres of land. This building will be used by Ivy Tech to consolidate their apprenticeship programs, which are currently housed in two different locations. The relocation of the apprenticeship programs into this building then allows classrooms to be expanded into the space they currently occupy. In addition, the western half of this lot will provide much needed parking for the expansion of classrooms in the ITOSS building. After forming a search committee, Habitat’s Board considered and analyzed many different locations. They came to the conclusion that the old Kroger store and adjacent parking lot to the north, at the southwest corner of Main and Ewing, best fits their needs and mission. Habitat has counter offered $345,000 for the property. This price allows for the acquisition of these properties. In addition, relocation costs of 24 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) D. Airport Economic Development Area (1) continued… $342,223 are requested, which includes $57,333 for moving and re-establishment expenses, and $284,890 for the rehabilitation of the building and parking lot (new roof, HVAC, general build out, parking lot overlay). The total cost is $687,223. The building was built in 1970, and is in need of these repairs for the safe operation of Habitat’s ReStore. Staff feels Habitat moving to this highly visible corner will help stabilize this area and be a positive influence on the surrounding neighborhood. In addition, it will greatly help Ivy Tech, which makes this a win-win situation for everyone. Ms. King asked if we typically do this much for relocation. Mr. Relos said we do. He gave the relocation of Ziolkowski’s as an example. We need to make a business “whole” when we ask them to relocate for our purposes. Ms. King asked if we know, or does Habitat know, that $345,000 is what the Kroger store and parking lot are worth. Mr. Relos responded that the Kroger store was on the market for $395,000. Habitat is getting it for $265,000. The price of the parking lot is $80,000, totaling $345,000, hence the counter offer Habitat made for its Sample Street property. Ms. King asked if anyone did an appraisal on the property. Mr. Pink, Habitat’s real estate 25 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) D. Airport Economic Development Area (1) continued… agent, responded. Habitat entered into a letter agreement with the owner of the Kroger store for $265,000, as the price it could pay and the owner agreed to accept that amount. The lot to the north was not really on the market. But we spoke with the owner, Watcon, who agreed to a purchase price of $80,000, $20,000 less than he had been willing to sell for previously. Ms. King thought the $265,000 price was very high since it has been sitting vacant for so long. No one else is interested in it. Mr. Pink said he had looked with Habitat at over a dozen properties in Mishawaka and South Bend. The prices for the properties they looked at ranged from $12-$20 per sq. ft. The purchase price of Kroger is $10 sq. ft. Ms. King reiterated her question: has anyone done a recent appraisal of this property? The answer was no. Mr. Varner asked if the purchase of the Kroger building was contingent on Habitat being able to also purchase the parking lot. Mr. Pink said that it would be. The owner of Watcon was more than willing to cooperate in this deal. His only request was to be allowed parking for his employees if he should expand and need to meet additional zoning requirements. 26 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) D. Airport Economic Development Area (1) continued… Ms. King asked whether CB Richard Ellis is both the listing and sales agency for the Kroger property. Mr. Pink said that it is, though different agents. Ms. King suggested that from a business standpoint, Habitat should get a current appraisal of the property. Mr. Inks noted that the Commission is essentially buying the property for Habitat. He asked whether the city needed to close on this deal on a fast track. Mr. Relos responded that it does not. Ms. Spivey asked whether, in the interest of moving the project along, the Commission could take some action indicating its intent to participate in the project. Mr. Pink asked if the appraisal came back lower than $345,000, would the Commission expect the seller to accept that price. Mr. Downes responded that a lower appraisal would improve Habitat’s negotiating position. Mr. Pink asked who would spend $2,400 to get an appraisal done, not knowing if the Commission would approve the acquisition of Sample Street after the appraisal. He noted that a letter of understanding, not necessarily a purchase agreement, could be drafted for the Main Street property. Or a purchase agreement could be drafted with the contingency that the Main Street property 27 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) D. Airport Economic Development Area (1) continued… appraise out at $345,000. CH’ Mr. Downes made a motion to accept OMMISSION ACCEPTED ABITATS COUNTER 412SS. OFFER FOR AMPLE T IN THE AMOUNT OF Habitat’s counter offer for 412 Sample St. in $345,223 AND APPROVED RELOCATION the amount of $345,000 and approve $342,223, EXPENSES OF CONTINGENT ON relocation expenses of $342,223 contingent GETTING AN OUTSIDE APPRAISAL OF THE on getting an outside appraisal of the Kroger KW ROGER PROPERTY AND ATCON PARKING LOT $342,223 property and Watcon parking lot that is close THAT IS CLOSE TO THE TOTAL to the $342,223 total. Ms. King seconded. The motion carried. (3) Confidential Settlement Agreement and Release with Century Indemnity Company and TIG Insurance Company related to property in the Airport Economic Development Area. Ms. Kolata noted that several years ago the Commission and the city hired environmental legal counsel to pursue previous owners of Studebaker and Oliver properties for environmental damage to those properties. We have had a couple of settlements in the past. This one is related to the former Oliver property. The insurance companies are willing to pay the Commission an amount that has been approved by our legal department to settle the claim. There are remaining claims against other insurers, but this agreement only covers Century Indemnity and TIG. It also specifically states that it only covers the Oliver property. It does not cover anything in Studebaker. Staff requests approval of the settlement, subject to final legal review of the language in the agreement. The amount of the settlement is 28 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) D. Airport Economic Development Area (3) continued… not public. When it arrives and is appropriated, the amount will be known. CC Upon a motion by Mr. Downes, seconded by OMMISSION APPROVED THE ONFIDENTIAL SAR ETTLEMENT GREEMENT AND ELEASE WITH Ms. King and unanimously carried, the CICTIG ENTURY NDEMNITY OMPANY AND Commission approved the Confidential IC NSURANCE OMPANY RELATED TO PROPERTY IN Settlement Agreement and Release with AEDA THE IRPORT CONOMIC EVELOPMENT REA Century Indemnity Company and TIG Insurance Company related to property in the Airport Economic Development Area. (4) Resolution No. 2641 related to acquisition of property in the Airport Economic Development Area (1506 S Taylor) Mr. Relos noted that 1506 S. Taylor St. was added to the Airport Economic Development Area Acquisition List by Resolution No. 2596 on August 26, 2009. It was added in an effort to clean and clear the southern boundary of Ignition Park, and to help stabilize the Rum Village neighborhood to the south. The Rum Village Neighborhood Association strongly supports the redevelopment of this area on the north side of Indiana Avenue. This particular property is a one story, two bedroom single family residence. The property owner would like to participate in the goals of the Commission in its efforts to clean and clear this area, and contacted staff with his interest in selling this property. Resolution No. 2641 sets the acquisition value of the property at $26,750, the average 29 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) D. Airport Economic Development Area (4) continued… value as determined by two independent appraisals. CRN.2641 Upon a motion by Mr. Downes, seconded by OMMISSION APPROVED ESOLUTION O RELATED TO ACQUISITION OF PROPERTY IN THE Ms. King and unanimously carried, the AEDA IRPORT CONOMIC EVELOPMENT REA Commission approved Resolution No. 2641 (1506ST) AYLOR related to acquisition of property in the Airport Economic Development Area (1506 S Taylor) (5) Resolution No. 2642 approving and accepting a counter offer for the acquisition of property in the Airport Economic Development Area (1506 S Taylor) Mr. Relos noted that the owner has made a counter offer in the amount of $48,000. The property owner had a licensed realtor do a comparative market analysis for homes that had sold in their neighborhood. This analysis compared three similar homes that had sold in the last year, with a median sales price of $48,500. In addition, the owner would like $4,000 in relocation costs. The house and garage at this property are very full, and this amount is less than if a mover were hired to pack, move, and unpack its contents. Commissioners were surprised at the discrepancy between appraisals. Mr. Relos noted that there is also great discrepancy between the appraisals and assessed values, supposedly reflective of the market. 30 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) D. Airport Economic Development Area (5) continued… Ms. King questioned why we do appraisals, which are supposed to be based on comparative analysis, independent and unbiased, then accept a price based on analysis by a licensed realtor. Mr. Relos noted that for all of the homes that we are trying to buy in that area, the mortgages are upside down. Mr. Downes asked if there is a time crunch to close on this purchase. There is not. Mr. Varner asked if the Commission has a policy addressing how we deal with purchasing a property that is upside down on its mortgage. Mr. Inks said they do not. But in the Airport Economic Development Area the Commission does not have use of eminent domain. It relies on the willingness of the seller to sell. Staff always tries to negotiate the best purchase price. They are sometimes dissatisfied with the best price they can get. This offer does beg the question of why our appraisers’ values are so much different than the realtor’s. It is staff responsibility to review the work of its appraisers and make sure we are comfortable with it. We can’t explain the difference, but to convince someone to move who is satisfied living in the home they have, they have to feel like they can purchase something comparable without additional expense to themselves. Our price may have to include making them 31 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) D. Airport Economic Development Area (5) continued… whole on their mortgage. Mr. Varner noted that the Commission’s price sets precedent for the next purchase we make. Ms. Jones said that the amounts don’t bother her as much as the inconsistency. Ms. King said that these homes aren’t going to sell at all if we don’t buy them, implying that the value is very low. Ms. Spivey asked if there isn’t a standard rubric that appraisers use. The variation should not be so great. Mr. Inks agreed the variation should not be so great, but the discrepancy is caused by which comparable sales are selected for comparison. Ms. King asked about the process: our appraisers come up with their values; we make an offer based on those; Mr. Relos added that staff pays for title work to determine what liens are outstanding on the property; the owner provides the mortgage balance. Sellers don’t want to sell and still have a mortgage to pay off. Ms. King asked if the owner said he wouldn’t sell unless we paid off his mortgage. Do we negotiate? Mr. Relos responded that we do negotiate to get the best deal we can. Mr. Downes asked if we can’t counter the owner’s counter. Mr. Relos said that we did. 32 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) D. Airport Economic Development Area (5) continued… The original counter was $50,000. Ms. Spivey asked if Commissioners could see the market analysis performed by our appraisers. Mr. Inks said they could. Ms. King said the Commissioners’ role is not to second guess the appraisals. That is the job of staff. The question to the Commission is whether it approves the $48,000 counter offer. She suggested the Commission take action on the resolution. CCO Mr. Downes made a motion to approve OMMISSION REJECTED THE OUNTER FFER RN.2642 PRESENTED IN ESOLUTION O FOR THE Resolution No. Resolution No. 2642 1506ST ACQUISITION OF AYLOR approving and accepting a counter offer 1506 S Taylor. Mr. Varner seconded the motion. The vote was two in favor, three against. The motion did not pass. E. West Washington-Chapin Development Area There was no business in the West Washington- Chapin Development Area. G. Northeast Neighborhood Development Area There was no business in the Northeast Neighborhood Development Area. H. Douglas Road Economic Development Area There was no business in the Douglas Road Economic Development Area. 33 South Bend Redevelopment Commission Regular Meeting –January 15, 2010 6. NEW BUSINESS (CONT.) I. Ratification of Services Contracts Mr. Inks noted the only ratification today is for a Meridian Title proposal for title searches. C Upon a motion by Mr. Downes, seconded by Ms. OMMISSION RATIFIED THE CONTRACTS D18,2009 APPROVED BY STAFF SINCE ECEMBER King and unanimously carried, the Commission ratified the contracts approved by staff since December 18, 2009. 7. PROGRESS REPORTS PR There was no report. ROGRESS EPORTS 8. NEXT COMMISSION MEETING NCM The next meeting of the Redevelopment Commission is EXT OMMISSION EETING scheduled for Friday, February 5, 2010 at 10:00 a.m. 9. ADJOURNMENT A There being no further business to come before the DJOURNMENT Redevelopment Commission, Ms. King made a motion that the meeting be adjourned. Mr. Varner seconded the motion and the meeting was adjourned at 11:47 a.m. 34