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Home My WebLink About2. Minutes 8/6/10 MeetingSOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING August 6, 2010 10:00 a.in. 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 Mr. Greg Downes Mr. Donald Alford Ms. Stephanie Spivey Members Absent: Ms. Nancy King, Secretary Legal Counsel: Mr. Charles S. Leone, Esq. Mr. Lawrence Meteiver, Esq. Redevelopment Staff: Mr. Don Inks, Director Mrs. Cheryl Phipps, Recording Secretary Mr. Bill Schalliol, Economic Development Specialist Ms. Ann Kolata, Economic Development Specialist Mr. David Relos, Economic Development Specialist Ms. Debrah Jennings, Property Manager Others Present: Mr. Tom Price, Mayor's Office Ms. Rita Kopala Ms. GlendaRae Hernandez Mr. Marco Mariani, Downtown South Bend Ms. Tamara Nicholl-Smith, Downtown South Bend Ms. Autumn Psaros, CB Richard Ellis Mr. Shawn Todd, CB Richard Ellis Mr. Jeff Parrott, South Bend Tribune Mr. Mark Seaman, Prism Science Ms. Mo Miller, Prism Science Ms. Yolanda Hale 2. APPROVAL OF MINUTES A. Approval of Minutes of the Regular Meeting of Friday, Jule 23, 2010. Upon a motlOn by Mr. Vainer, SeCOnded by Mr. COMMISSION APPROVED THE MINUTES OF THE Alford and unanimously carried, the CommisslOn REGULAR MEETING OF FRIDAY, .IULY 23, 2010 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 2. APPROVAL OF MINUTES (CONT.) A. continued... approved the Minutes of the Regular Meeting of Friday, July 23, 2010. 3. APPROVAL OF CLAIMS Redevelopment Commission Claims submitted August 6, 2010 for approval. FUND 324 AIRPORT AEDA Circle Lumber, Inc 44.88 1510 S. Catalpa Arnold Dorey 25.00 Testing well water @ new residence Owners' Association at Blackthorn 14,790.17 Property Management Assessment City of South Bend 136.00 Under Ground Pipe & Valve Walsh & Kelly Inc 123,466.65 Demolition of 1202 S. Lafayette Radde Investigative & Security Studebaker Demo Site agency, Inc. 495.00 SBD Reprographics 463.96 Studebaker Area A Demo Site Meridian Title Corporation 22,762.00 1506 S Taylor Closing Meridian Title Corporation 25,518.87 1506 S Catalpa St Craig Ungerecht Meridian Title Corporation 3,368.74 1519 S. Kemble Ave Anthony Ross Meridian Title Corporation 202,749.11 1313 Prairie Ave Closing Meridian Title Corporation 2,929.03 823 W. Indiana Ave Arnold & Sally Dorey 2,300.00 Fixed Moving cost Radde Investigative & Security 774.00 Security Srvc During Bidding Period Meridian Title Corporation 6,218.25 Acquisition of 1510 S. Kemble Ave DHA 15,937.00 Mayflower Rd Realignment & Circle Lumber, Inc 22.88 Board 1510 Kimble DIIA 1,575.00 Relocation to 17836 Edgewood Tri-County News 63.07 Fred's Transmission Meridian Title Corporation 200.00 Lot 40, Raffs 3rd Airport Authority 65,609.00 Improvements on Progress Drive Phifer Environmental Services Phase I Environmental Site A LLC 1,400.00 Michaels Appraisal Service 450.00 Appraisal Fee Srvc Rendered David Waszak appraisals, Inc 4,800.00 Appraisal Fee Srvc Rendered Meridian Title Corporation 500.00 Report Indiana Michigan Power 7.00 501 Wenger St. R.E. Pitts R Associates, Inc 1,650.00 1521-1527 Kendall St. WITT Appraisal Services Inc 400.00 Appraisal of Vacant Land 2 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 3. APPROVAL OF CLAIMS (CONT.) FUND 324 AIRPORT AEDA DLZ 7,642.50 DLZ 20,037.50 Carl Walker 8,246.16 Innovation Park 630.00 Jerome E. Michaels, MAI 6,900.00 Circle Lumber, Inc 34.82 DNA 4,330.00 South Bend Municipal Utility Bill 37.94 Ziolkowski Construction 133,125.30 Meridian Title Corporation 33,092.05 420 FUND TIF DISTRICT-SBCDA GENERAL Baker & Daniels 2,089.00 Burbaml Sport Nets 70,054.00 Ampco System Parking 899.93 Comcast Cable Communications 8,171.97 Fisher Athletic 102,057.00 FUND 431 TIF SSDA #2 - ERSKINE COMMONS Baker & Daniels 2,530.00 $ 898,533.78 Upon a motion by Mr. Downes, seconded by Mr. Alford and unanimously carried, the Commission approved the Claims submitted August 6, 2010, and ordered checks to be released. 4. COMMUNICATIONS There Were n0 COmlllumCat10T1S. 5. OLD BUSINESS There was no Old Business. Expansion of Olive Rd & Pine Michigan St. S Curve Removal Bartlett St. garage Bartlett St. Garage Old Wilson Bros. Shirt Factory 1506 Catalpa Oliver Trail System 325 S Lafayette Blvd Ivy Tech on Sample St. 1513 S Kendall St. Profession Service Coveleski Stadium Backstop 225 Main St. Fred's Transmission 507 Western Coveleski Stadium Wall Pads Legal Services COMMISSION APPROVEDTHECLAIMS SUBMITTED AUGUST 6, 2010, AND ORDERED THE CHECKS TO BE RELEASED THERE VV'ERE NO COMMUNICATIONS THERE W'AS NO OLD BUSINESS 3 South Bend Redevelopment Commission Regular Meeting August 6, 2010 6. NEW BUSINESS A. South Bend Central Development Area (1) Proposal for repair of surface parking lot at 225 S. Main Street. Ms. Jennings noted that 225 S. Main Street, at the corner of Main and Jefferson, is in need of repair. The License Auditor for the City of South Bend has inspected the lot and determined there are trip hazards throughout the parking lot with holes and loose asphalt material. Ampco Parking, the management company for the city"sparking lots and garages, solicited three quotes for the repair, which ranged fi-om $13,450 to $9,165. However, on July 9, the Commission authorized Danch Harney & Associates to design landscaping for the lot. Danch Harney has assured staff there is no duplication of services. Danch Harney will coordinate with the Arndt Asphalt Sealing to get both jobs done without interference. Staff recommends approving the contract with Arndt at a cost not to exceed $12,000, in case there are additional costs related to the coordination. Ms. Jones noted that Arndt is not a local tu-~n. The second lowest bid vas from a local firm. She suggested using the second lowest bid, since we were setting the not-to- exceed amount at $12,000. Mr. Inks responded that staff does not have the authority to go with anything but the lowest quote. If the scope of the project changes it can be re-quoted. Maybe the results will change. 4 South Bend Redevelopment Connnission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) A. South Bend Central Development Area (1) continued... Mr. Varner said he also prefers to use a local firm, but feels like the amount of money involved is small and he'd like to see the job done promptly. Mr. Alford asked how soon it would be clear whether the quote would change. Mr. Inks responded that it should not take long. The two dry wells under the parking lot are where the problem might be. The recommendation is that at those dry wells we should go down about twelve inches and snake repairs before paving over them. Also, a wall is to be removed at the edge of the lot. Depending on whether the wall sits on the sidewalk or on dirt, the parking lot may need to be extended some to cover that void. Ms. Spivey was intrigued to learn that the Commission preferred to hire local contractors. She asked how that factor is weighed. Ms. Jones responded that we cannot weigh factors like that. The only reason we may be able to re-quote this at all is because the scope of services has changed. The bids may or may not come in differently. Mr. Downes made a motion to re-quote the job and allow staff to accept the lowest resultin~~ bid as lone as it doesn't exceed $12,000. Mr. Alford seconded the motion. The motion can-ied unanimously. (2) Resolution No. 2743 related to acquisition of property located at 502 Western Avenue. (Harmon Glass) COMMISSION ASKED STAFF TO RE-QUOTE THE PAVING JOB AND AUTHORIZED STAFF TO ACCEPT THE LOWEST QUOTE IN A NOT TO EXCEED AMOUNT OF $12.000 5 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) A. South Bend Central Development Area (2) continued... Mr. Schalliol noted that the property at 502 Western is the former Harmon Glass Company, located on the southwest corner of Western and William. Harmon vacated the site in 2008 and consolidated its operations at another location. Resolution No. 2743 sets the Acquisition Offering Price at $85,750, based on the average of two commercial appraisals. This appraisal was completed at a time when the building was vacant and partially damaged due to an auto accident, so the value is lower than it might appraise currently. The property has been on the market since 2009. Staff has avoided acquiring the property, but is interested in doing so at this time because it has learned of a potential reuse of the site that might be detrimental to the Coveleski project. Mr. Schalliol noted that bids are to be opened in about two weeks for demolition of Fred's Transmission. Staff is working on a potential reuse of the former Gates Toyota building. It seems like a good time to reconsider acquiring the Hannon Glass property. Staff requests approval. Mr. Varner wondered why the Commission needs to get involved in acquiring this property. He prefers to see it remain a private, tax paying property. Mr. Schalliol responded that ~~~ith evervthina else we're trying to do in the area, staff would like to control the use of that corner. Mr. Varner 6 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) A. South Bend Central Development Area (2) continued... expressed his opinion that the Commission is a little too concerned about control. Mr. Downes made a motion to approve Resolution No. 2743. Mr. Alford seconded. The motion passed with three affirmative votes. Mr. Varner opposed. (3) Resolution No. 2744 approving and accepting a counteroffer for property located at 502 Western Avenue. (Harmon Glass) Mr. Schalliol asked that item 6.A.(3) be tabled. Upon a motion by Mr. Downes, seconded by Mr. Alford and unanimously carried, Item 6.A.(3) was tabled. (4) Staff report on proposal to lease 131 S. Michigan St. (Former Quiznos) Ms. Jennings noted that CB Richard Ellis has received a proposal from Brunos Pizza to lease 131 S. Michigan Street, the former Quiznos Sandwich Shop. Brunos has asked for athree-year, two-month lease, beginning with two months free rent. Brunos will be responsible for tenant improvements to the space which staff anticipates will cost from 540.000 - 560,000. Brunos will pay utilities, would like permission for sidewalk seating, and requests an option to renew the lease for an additional three-year term. COMMISSION APPROVED RESOLUTION NO. 2743 RELATED TO ACQUISITION OF PROPERTY LOCATED AT SO2 WESTERN AVENUE. ~HARMON GLASS) ITEM 6.A.(3) WAS TABLED South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) A. South Bend Central Development Area (4) continued... Ms. Jennings noted that the proposed base rent is $1,200 per month for the first year, $1,300 per month for year two, and $1,400 for year three, beginning with two months free rent. The rent includes Common Area Maintenance (CAM). Ms. Jones asked what CAM runs. Mr. Inks responded that this rent assumes CAM of $4/sft. Mr. Varner asked the size of the space. Mr. Inks responded 1,530 sft. Mr. Downes asked how the rent compares to what Quiznos was paying. Mr. Inks responded that the rent for Brunos starts at $5.41/sft and increases to$6.98 in year three. Quiznos was at $9-10/sft. Mr. Inks noted that CB Richard Ellis researched the local market. The retail market is not very good right now. We could be asking the Commission to make the improvements to the space, which would far exceed the rental income over the three years. Some properties are getting up to a year free rent. We feel this rent compares favorably to what the current market is getting. We feel fortunate to get the space filled with such a quality tenant. Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission authorized staff to prepare a lease with Bruno~s Pizza at the terms stated for 131 S. Michigan St. COMMISSION AUTHORIZED STAFF TO PREPARE A LEASE WITH BRUNO'S PIZZA AT THE TERMS STATED FOR 131 S. MICHIGAN ST South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (1) Approval of Loan Agreement, Promissory Note and Grant Agreement for environmental remediation at 1100 Prairie Avenue. Ms. Kolata noted that at the July 23 meeting the Commission approved a loan and grant from the citys enviromnental revolving loan fund for environmental remediation at the Studebaker foundry. This is the final approval of the Loan Agreement, the Promissory Note and the Grant Agreement with the City of South Bend. It provides for a grant of $160,000 and a loan not to exceed $500,000. The loan is a 10-year loan at 0% interest with no pa}nnents for the first five years. The reasoning behind that is that EPA supplied the funds for the loan fund. The goal is to spend all the money, not get any of it repaid, then close out the grant. We will have aclose-out agreement with EPA that tells us that any money that comes in after the close-out will belong to the City of South Bend and will be subject to any teens we negotiate with EPA. It will probably have some sort of environmental requirement on it. but will be the cit~~'s money. Mr. Downes asked when demolition will begin. Ms. Kolata responded that the bids came in last week. Staff intends to interview at least the two low bidders. The bids ranged fi•om just under $6M to over $IOM. That's for demolition of both the foundry and the engineering building. The Board of Public Works will award the bid on August 23. 9 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (1) continued... Upon a motion by Mr. Downes, seconded by Mr. Alford and unanimously carried, the Commission approved the Loan Agreement, Promissory Note and Grant Agreement for environmental remediation at 1100 Prairie Avenue. (2) Resolution No. 2737 related to acquisition of property at 1513 S. Scott Street. (Residential) Mr. Relos reported on research he did on how appraisals are done for rental property. He hoped to provide an understanding of the low appraisals we are getting for rental properties, versus the alternative methods of appraising that result in a higher appraisal. Mr. Relos noted that appraisers are required to follow the Uniform Standards of Professional Appraisal Practices. This limits how they can appraise a property, without a statement of an extraordinary assumption. Under those standards, the Definition of Market Value is that the "buyer and seller are typically motivated-'. That is true in the general market. but the Commission doesn't always have a motivated seller. We may have an interested seller, but they are not always motivated to sell. That difference is significant. Income approach: Appraisals on single family rentals nornlally use an income multiplier, commonly called a gross rent multiplier. These multipliers are COMMISSION APPROVED THE LOAN AGREEMENT, PROMISSORY NOTE AND GRANT AGREEMENT FOR ENVIRONMENTAL REMEDIATION AT 1 100 PRAIRIE AVENUE 10 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (2) continued... still market based. They look at what a rental sold for, and divide the sales price by the gross annual rent, to get a multiplier effect. Example: a rental house sells for $30,000, which has rented for $500 /month, or $6,000 / year. $30,000 / $6,000 = a multiplier of 5. You would then multiply the annual rent of another house by this multiplier to get a value. The multipliers have many factors that can effect their usefulness, such as area of the city, condition of the properties, etc. Capitalization Rate (Cap Rate): The cap rate method is used almost exclusively on larger commercial income producing properties. To comfortably use this method, appraisers require 3 years of operating statements, which reflects the historical income and expenses of the property. Appraisers don't consider using this approach without a statement of an extraordinary assumption, because this information is not generally available, or is based solely on information the owner provides. The Cap Rate method looks at the gross income and deducts for expenses to arrive at a net income stream. This net income is then divided by the cap rate, usually in the 10% range. Banks do use this method to value single family rentals, especially for good customers. Appraisers, because of the Standards they have to follow, shy away from this method for single family rentals. 11 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (2) continued... Mr. Relos feels the Commission should consider this valuation method for rental properties, because there are properties we are dealing that have been appraised by a bank using the Cap Rate method. Mr. Relos suggested to the Commission that it use the Cap Rate approach to calculating rental property value. Banks use it, especially for their good customers who own a large number of rentals. Mr. Inks noted that though appraisers are limited by their rules. we don't have sellers who are motivated to sell. We need to get from the market average price to the reality of what we need to pay in order to create a willing seller. As Mr. Relos brings forward his administrative settlements on several properties throughout today's agenda. the Commission will see significant discrepancies between what the appraiser valued the properties at, using the Market Approach, and what staff is suggesting the Commission accept as an administrative settlement. Mr. Varner said he realized the Commission needs to find a way to motivate a seller. He wanted to know we have a standard method to establish our price in order to keep each successive owner from wanting more than the previous seller received. Mr. Inks responded that that is the goal of this explanation today: to establish such a method. 12 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (2) continued... Mr. Relos then noted that Resolution No. 2737 requests the Commission set the value of 1513 S. Scott Street at $17,750, the average of two independent appraisals merged with the Income Approach. The property is a two story, three to four bedroom single family rental residence. Ms. Jones noted the assessed value of the property for taxing purposes is $38,300. She wondered how that could be, if the assessed value is now supposed to be a market value. Mr. Relos responded that he finds the assessed values of properties in this area to be "all over the place." It is the property owner's responsibility to challenge the assessment. There has been a reassessment and many of the properties in this area will assess at a lot lower in Pay 1011. Upon a motion by Mr. Downes, seconded by Mr. Alford and unanimously carried, the Commission approved Resolution No. 2737 related to acquisition of property at 1513 S. Scott Street. (3) Staff report on Administrative Settlement for 1513 S. Scott Street. (Residential) Mr. Relos noted that when valuing the property based solely on the income approach, the average appraised value is $21,875 ($22,500 and $21,250). The house is assessed at 538,300. In discussions with the property owner, they COMMISSION APPROVED RESOLUTION NO. 2737 RELATED TO ACQUISITION OF PROPERTY AT 1513 S. SCOTT STREET 13 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (3) continued... currently have a lease for $600 per month in rent (which has been verified), and would not be able to replace this rental house with another one if paid the average appraised value. The owner has done the following to the house in the 10 years they have owned it: upgraded the electrical service to 100 amp; new water heater, interior paint, roof, kitchen cabinets, and faucets in the kitchen and bathroom. The property owner has agreed to accept $25,000, an amount they feel is adequate to replace this rental property with another income producing property. Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission approved the Administrative Settlement of $3,125 for 1513 S. Scott Street. (4) Resolution No. 2738 related to acquisition of property- at 609 ~~'. Indiana Avenue. (Monique Inc. Warehouse) Mr. Relos noted that 609 W. Indiana was added to the Airport Economic Development Area Acquisition List by Resolution No. 2668 on May 21.2010. The property is a one story brick and cement block connnercial building, currently being used as a warehouse. The building is 4,940 square feet, with the total lot size being 5,700 square feet. Resolution No. 2738 sets the COMMISSION APPROVED THE ADMINISTRATIVE SETTLEMENT OF 83125 FOR 1513 S. SCOTT STREET 14 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (4) continued... acquisition offering price at $28,500. Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission approved Resolution No. 2738 related to acquisition of property at 609 W. Indiana Avenue. (Monique Inc. Warehouse) (5) Resolution No. 2739 approving and accepting a counteroffer for property located at 609 W. Indiana Avenue. (Monique Inc. Warehouse) The property owner submitted a counter offer of 530,000. No relocation assistance is needed. Staff feels this counter offer is a reasonable value for this property. Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission approved Resolution No. 2739 approving and accepting a counteroffer in the amount of 530,000 for property located at 609 W. Indiana Avenue. (Monique Inc. Warehouse) (6) Resolution No. 2740 related to acquisition of properh~ at 1507 S. Taylor Street. (Residential) Mr. Relos noted that 1507 S. Taylor St. was added to the Airport Economic Development Area Acquisition List by Resolution No. 2668 on May 21, 2010 The property contains a two story house, COMMISSION APPROVED RESOLUTION NO. 2738 RELATED TO ACQUISITION OF PROPERTY AT 609 W. INDIANA AVENUE. (MONIQUE INC. WAREHOUSE COMMISSION APPROVED RESOLUTION NO. 2739 APPROVING AND ACCEPTING A COUNTEROFFER OF 530.000 FOR PROPERTY LOCATED AT 609 W. INDIANA AVENUE. (MONIQUE INC. WAREHOUSE 15 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (6) continued... with rental apartments on both the first and second floors. Each aparhnent has its own heating and electrical service. The first floor apartment has two bedrooms and 1 '/2 baths. The second floor apartment is one bedroom and one bath. Attached to the house is a 3,135 square foot cement block warehouse used for storage by the property owner. Resolution No. 2740 sets the acquisition value of the property at $27,000, the average of two independent appraisals. Upon a motion by Mr. Alford, seconded by Mr. Downes and unanimously can-ied, the Commission approved Resolution No. 2740 related to acquisition of property at 1507 S. Taylor Street. (7) Staff report on Administrative Settlement for 1507 S. Ta~~lor Street. (Residential) Mr. Relos noted that staff requests an administrative settlement in order to purchase 1507 S. Taylor. Because the warehouse attached to the 2 story, 2 unit rental house is owner occupied, and takes up most of the property, neither commercial appraiser valued the property fi-om an income approach. Twelve years ago, the property owner purchased the property for 559,000. Over the years, he has upgraded the roof and electrical services. Between the two units in the house, the property owner receives $900 per month COMMISSION APPROVED RESOLUTION NO. 2740 RELATED TO ACQUISITION OE PROPERTY AT 1507 S. TAB"LOR STREET. 16 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (7) continued... in rent. Based on this income stream, deducting a 10% vacancy rate, $604 per year in real estate taxes, $800 per year for insurance, and $1,000 per year in maintenance, the net income per year is $7,316. At a cap rate of 11 %, the value of the rental house itself would be $66,500. Staff did verify with a local credit union that they use a cap rate of 9 - 11 % to value income producing properties. The property owner, who owns over 200 properties in this area, has agreed to accept $95,000 for this property. This purchase price would relieve the Commission of any relocation assistance for both the owner's warehouse and tenants, as the owner is waiting for the Commission's decision before he signs any long term leases for the tenants currently residing in the two apartments. Staff feels the acquisition cost of $95,000 is reasonable for this property, and requests your approval of the administrative settlement to allow for the acquisition of this property. Mr. Relos checked with CB Richard Ellis who said S 10-$15 per sft was a reasonable lease rate for warehouse space. That lease rate results in a $30,000 valuation for the warehouse. Mr. Inks noted that the breakdown is that we would be paying $66.000 for the duplex and $29,000 for the warehouse. This is the acquisition that precipitated Mr. Relos• research on other appraisal methods. The l7 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (7) continued... appraisals we ordered on this property did us virtually no good. We either need to give instructions to the appraisers that beyond your typical appraisal report, we want one or more of these other methods used. The appraisals may cost us more, but they would give us more valuable information on which to make our offer. Ms. Jones noted that, not only are the appraisals we've been getting doing us not good, they are doing us harm. The result is that we use too much subjectivity in coming up with a settlement. That is a bad precedent. She would be happy to pay more for the appraisal if we could rely more on the valuation. Upon a motion by Mr. Downes, seconded by Mr. Vainer and unanimously can-ied, the Commission approved the Administrative Settlement of 565.000 for 1507 S. Tavlor Street. (8) Resolution No. 2741 related to acquisition of propert~~ at 807 ~~'. Indiana Avenue. (Hell's Angels) Mr. Relos noted that 807 W. Indiana was added to the Acquisition List by Resolution No. ?668 on May 21, ?010. The property consists of a two story house that over the years has been added on to and com-erted to a bar. It now contains a private club, with the interior build out consisting of a lounge area. bar• kitchen, bath room, and storage COMMISSION APPROVED THE ADMINISTRATIVE SETTLEMENT OF $65,000 FOR ISO7 S. TAYLOR STREET 18 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (8) continued... areas. The back yard perimeter has privacy fencing, and there is a vacant lot adjacent to the east. Resolution No. 2741 sets the acquisition value of the property at $24,000, the average of two independent appraisals. Upon a motion by Mr. Varner, seconded by Mr. Downes and unanimously carried, the Commission approved Resolution No. 2741 related to acquisition of property at 807 W. Indiana Avenue. (Hell's Angels) (9) Staff report on Administrative Settlement for 807 W. Indiana Avenue. (Hell's Angels) Mr. Relos noted that 807 W. Indiana Avenue. The private club that occupies this property has decided to accept the purchase offer of $24,000, but they need relocation assistance to acquire and make improvements to a new building for their move. Because City ordinance allows private clubs to locate only in Local Business or Mixed Use zoned areas, this limits where the club can relocate. Additionally, private clubs need a special exception to locate even in these two zoned areas. The club has found a building cun-ently for sale in a Mixed Use zoned area. They have made an offer to purchase, contingent on the Commission's relocation assistance approval. and the special exception and variances they need. The building was originally listed in 2007 for 5144,900, later reduced to COMMISSION APPROVED RESOLUTION NO. 2741 RELATED TO ACQUISITION OF PROPERTY AT 807 W. INDIANA AVENUE. (HELL'S ANGELS 19 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (9) continued... $124,900, $99,900, and now to $95,000. The purchase price agreed to between the parties is $85,000. In addition to the purchase price of the building, certain minor improvements are needed. The building was a grocery store with large windows on the front. The club would want those bricked up. They want privacy fencing like they have at their cuiTent location, and a small gravel parking area needs to be paved. These improvements have been estimated at $31,000, Hell's Angels is requesting the Commission cover the first $12,000, plus $61,000 toward the purchase of the building. Staff feels the relocation assistance request is reasonable and asks for approval. Upon a motion by Mr. Downes, seconded by Mr. Alford and unanimously carried, the Commission approved the Staff report on Administrative Settlement for 807 W. Indiana Avenue. (Hell's Angels) (10) Proposal for engineering services related to relocation of properh~ o~~~ner at 807 W. Indiana Avenue. Mr. Relos noted that staff has solicited a proposal from Danch, Harner &. Associates for relocation efforts for Hell's An~zels at 807 W. Indiana Avenue. This private club is located in the area on the north side of Indiana Avenue, which has been targeted for the expansion of Ignition Park. COMMISSION APPROVED THE STAFF REPORT ON ADMINISTRATIVE SETTLEMENT FOR 807 W. INDIANA AVENUE. (HELL'S ANGELS 20 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (10) continued... According to the City's zoning ordinance, private clubs can only locate in the Mixed Use or Local Business zoned areas of the City. Within these areas, a private club must seek a special exception, requiring them to go before the Area Plan Commission and Coininon Council for approval. This club is going from a Mixed Use to a Mixed Use area. Total project services cost is $3,150, which includes the preparation of all documents necessary to seek this special exception. Also included in this proposal is the representation needed to go before Area Plan and the Common Council. Staff feels since we are requesting the relocation of this club, it is fair that the club not be required to pay for these services. Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission approved the Proposal for engineering services related to relocation of property owner at 807 W. Indiana Avenue. (ll) Resolution No. 2742 related to acquisition of propert~~ at 1514-1528 S. Kendall Street. (Rum Village Neighborhood vacant lots) Mr. Relos noted that these properties were added to the Airport Economic Developemnt Area Acquisition List by Resolution No. 2668 on May, 21, 2010. The property is four vacant lots owned by the Rum Village Neighborhood Association. They have COMMISSION APPROVED THE PROPOSAL FOR ENGINEERING SERVICES RELATED TO RELOCATION OF PROPERTY OWNER AT 8O7 W. INDIANA AVENUE 21 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (11) continued... decided they no longer want the maintenance and upkeep of this small park. Resolution No. 2742 sets the acquisition value of the property at $9,000, the average of two independent appraisals. Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously can-ied, the Corninission approved Resolution No. 2742 related to acquisition of property at 1514- 1528 S. Kendall Street. (Rum Village Neighborhood vacant lots) (12) Staff report on Administrative Settlement for 621 W. Indiana Avenue. (Residential) Mr. Relos noted that the Commission authorized the sending of a purchase offer in the amount of $20,050 for 621 W. Indiana Avenue. Approximately $7,000 additional is needed to gain clear title to this property. The property is a 1,300 square foot, two- story, three-bedroom single family residence. It has a fenced yard, covered porch, patio and storage shed. Staff recommends authorizing the administrative settlement of $6,950. Upon a motion by Mr. Downes, seconded by Mr. Alford and unanimously carried, the Commission approved the Administrative Settlement for 621 W. Indiana in the amount of $6,950. (13) Resolution No. 2745 related to acquisition of propert~~ at 1508 S. Scott St. (Residential) COMMISSION APPROVED RESOLUTION NO. 2742 RELATED TO ACQUISITION OF PROPERTY AT 1514-1528 S. KENDALL STREET. (RUM VILLAGE NEIGHBORHOOD VACANT LOTS) COMMISSION APPROVED THE ADMINISTRATIVE SETTLEMENT FOR 621 W. INDIANA IN THE AMOUNT OF $6,950 22 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (13) continued... Mr. Relos noted that Resolution No. 2745 sets the Acquisition Purchase Offer at $26,750. The property contains atwo-story, three-bedroom, single family rental residence, currently vacant. Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission approved Resolution No. 2745 related to acquisition of property at 1508 S. Scott St. (14) Resolution No. 2746 related to acquisition of property at 1513 S. Catalpa St. (Residential) Mr. Relos noted that Resolution No. 2746 sets the Acquisition Purchase Offer at $25,750. The property contains atwo-story, three bedroom, two-bath, single family rental residence. Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission approved Resolution No. 2746 related to acquisition of property at 1513 S. Catalpa St. (15) Proposal for survey services on Lafayette Street. (Sample to Stull) Mr. Schalliol noted that staff solicited a proposal from Wightman Petrie to do some sun-eying related to demolition this fall of Airgas and Ziolkowski. The fee is 52,820. COMMISSION APPROVED RESOLUTION NO. 2745 RELATED TO ACQUISITION OF PROPERTY AT 1508 S. SCOTT ST. COMMISSION APPROVED RESOLUTION NO. 2746 RELATED TO ACQUISITION OF PROPERTY AT 1513 S. CATALPA ST. 23 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (15) continued... Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission accepted the proposal from Wightman Petrie for the scope of services and fee proposed. (16) Proposal for professional services related to 2020 S. Main Street. (former EMI site) Mr. Schalliol noted that the Commission now owns the former EMI site. In anticipation of demolishing it, we need to have a topographic survey as well as some environmental testing in order to create a work plan to meet IDEM's requirements before demolition. The fee proposed by Wightman Petrie is $3,800. Staff requests approval of an amount not to exceed S4,000. Upon a motion by Mr. Downes, seconded by Mr. Alford and unanimously carried, the Commission accepted the proposal from Wightman Petrie for the scope of services proposed and an amount not to exceed $4,000. C. West Washington-Chapin Development Area There was no business in the West Washington- Chapin Development Area. D. South Side Development Area (1) Proposal for engineering services related to intersection of Norman Street and Michigan Street. COMMISSION ACCEPTED THE PROPOSAL FROM WIGHTMAN PETRIE FOR THE SCOPE OF SERVICES AND FEE PROPOSED COMMISSION ACCEPTED THE PROPOSAL FROM WIGHTMAN PETRIE FOR THE SCOPE OF SERVICES PROPOSED AND AN AMOUNT NOT TO EXCEED $4.000 24 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) D. South Side Development Area (1) continued... Mr. Schalliol noted that staff solicited a proposal from Lawson-Fisher Associates to provide engineering services for an access study for Norman Street at South Michigan Street. Several years ago the city made improvements to Michigan Street between the bypass and Chippewa. That work included anon-mountable median at Ireland. That median seems to have created a traffic hazard as southbound traffic wants to turn into the new Culvers. The purpose of the proposal is to study traffic patterns at and around the intersection and to make a deternlination as to whether the lane restrictions made on South Michigan Street can be modified to provide safer access to Norman Street. hnproved access to Norman Sheet would help Culver"s Restaurant currently located at the intersection as well as improve the developability of the land to the north of Norman Street. The proposal is a not to exceed amount of 52,500.00. Staff requests favorable approval of this proposal. Upon a motion by Mr. Downes, seconded by Mr. Alford and unanimously carried, the Commission accepted the proposal from Lawson-Fisher Associates for the scope of services proposed and an amount not to exceed 52,500. (2) Resolution No. 2709 approving and accepting a counter offer for propert~~ located at 748 Hawbaker Street (Vacant house) 25 COMMISSION ACCEPTED THE PROPOSAL FROM LAWSON-FISHER ASSOCIATES FOR THE SCOPE OF SERVICES PROPOSED AND AN AMOUNT NOT TO EXCEED $2,500 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) D. South Side Development Area (2) continued... Mr. Schalliol noted that the owner of 748 Hawbaker Street has made a counter offer of $50,000 to the city's purchase offer of $32,000. The property contains one unoccupied house. The owner originally had a contract for sale for the property in the amount of $140,000. Within a couple of weeks the city will put out to bid the Erskine Plaza pond project, which will rehabilitate and rebuild the storm water network on the south side. Acquisition of this parcel will provide a staging area and coordination site for that project. Mr. Schalliol noted that staff is still working on some legal and title issues, so asked the Commission to approve Resolution No. 2709 contingent on resolving those issues. Upon a motion by Mr. Varner, seconded by Mr. Downes and unanimously carried, the Commission approved Resolution No. 2709 contingent on resolving the outstanding legal and title issues. (3) Resolution No. 2715 approving and accepting a counteroffer for acquisition of propert~~ located at 4215 S. Main Street. Mr. Schalliol asked that item 6.D.(3) be tabled. There was no objection. (4) Authorization to begin the process to amend the South Side Development Area Development Plan. COMMISSION APPROVEDRESOLUTION NO.27O9 CONTINGENT ON RESOLVING THE OUTSTANDING LEGAL AND TITLE ISSUES ITEM 6.D.(3) WAS TABLED 26 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) D. South Side Development Area (4) continued... Mr. Schalliol noted that part of the process to amend a development plan to add properties to the acquisition list is to request of the Commission authorization to study the area and make a report to the Commission of findings. He asked for that authorization. Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission authorised staff to study the prospects of adding properties to the South Side Development Area Acquisition List. E. Northeast Neighborhood Development Area There was no business in the Northeast Neighborhood Development Area. F. Douglas Road Economic Development Area There was no business in the Douglas Road Economic Development Area. G. Ratification of Services Contracts COMMISSION AUTHORIZED STAFF TO STUDY THE PROSPECTS OF ADDING PROPERTIES TO THE SOUTH SIDE DEVELOPMENT AREA ACQUISITION LIST Commission Role in Sen~ice Contract Staff Transaction Contractor Provided Amount Member 1509 Acquisition Meridian Title ~ 100 Relos Kendall Title Work 1 X02 Chapin Acquisition Meridian Title $100 Relos Title Work 1514, 1518, Acquisition Meridian Title $400 Relos 1 X22. 1528 Title Work Kendall 27 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 6. NEW BUSINESS (CONT.) G. Ratification of Services Contracts continued... Commission Role in Service Contract Staff Transaction Contractor Provided Amount Member 1017 W. Acquisition Michaels Appraisal $600 Relos Indiana Appraisals (duplex) lOl7 W. Acquisition Witt Appraisal $550 Relos Indiana Appraisals (duplex) 1502 S. Acquisition Michaels Appraisal $350 Relos Chapin Appraisals 1502 S. Acquisition Witt Appraisal $325 Relos Chapin Appraisals 521 W. Acquisition Michaels Appraisal 5350 Relos Indiana Appraisals 1509 S. Acquisition Michaels Appraisal 5350 Relos Kendall Appraisals 521 W. Acquisition Witt Appraisal $675 Relos Indiana Appraisals 1509 S. Kendall 1534-1536 Acquisition Witt Appraisal 5700 Relos Prairie Appraisals 1534-1536 Acquisition Michaels Appraisal $750 Relos Prairie Appraisals 28 South Bend Redevelopment Commission Regular Meeting -August 6, 2010 Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission ratified the Services Contracts approved by staff since July 23, 2010. 7. PROGRESS REPORTS There was no report. 8. NEXT COMMISSION MEETING The next meeting of the Redevelopment Commission is scheduled for Friday, August 20, 2010 at 10:00 a.m. 9. ADJOURNMENT There being no further business to come before the Redevelopment Commission, Mr. Alford made a motion that the meeting be adjourned. Mr. Varner seconded the motion and the meeting was adjourned at 1 1:25 a.m. Donald E. Inks, Director COMMISSION RATIFIED THE SERVICES CONTRACTS APPROVED BY STAFF SINCE JULY ~3, ?oio PROGRESS REPORTS NEXT COMMISSION MEETING ADJOURNMENT 29