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HomeMy WebLinkAbout11-01-02 Redevelopment Commission Minutesc, SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING November 1, 2002 10:00 a.m. Presiding: Robert W. Hunt, President 1. ROLL CALL Members Present: Legal Counsel: 227 West Jefferson Boulevard South Bend, Indiana Mr. Robert W. Hunt, President Ms. Marcia Jones, Vice - President Mr. Philip J. Faccenda, Secretary Mr. Matt Kahn Ms. Cheryl Greene Redevelopment Staff. Mr. Donald Inks, Director Ms. Pamela Morris, Recording Secretary Mr. Owen Rock, Assistant Director Mr. Mike Beitzinger, Assistant Director Mr. Bob Case, Senior Economic Development Planner Mr. Bill Schalliol, Economic Development Planner Mr. Robert Mathia, Economic Development Specialist Mr. Tim Williams, Economic Development Specialist Mr. Andy Laurent, Economic Development Specialist Others Present: The Honorable Stephen J. Luecke, Mayor Mr. Larry Magliozzi, Asst. Director of Comm. Dev. Ms. Pam Paluszewski, Legal Mr. Jim Frick, South Gateway Business Assn. Mr. Ted Foti, Memorial Hospital Mr. Randy Rompola, Baker & Daniels Mr. Steve Cooreman, Cooreman Real Estate Group 2. APPROVAL OF MINUTES A. Commission approval of the Minutes of the Regular Meeting of October 18, 2002. The minutes were not available for approval. MINUTES WERE NOT AVAILABLE FOR APPROVAL. South Bend Redevelopment Commission ILRegular Meeting — November 1, 2002 3. APPROVAL OF CLAIMS Redevelopment Commission Claims submitted November 1, 2002 for approval. 212 CDBG COMMUNITY DEVELOPMENT Grants for Cities & Towns Andy Laurent Federal Express General Fund - Telephone Boise Cascade Office Products Petty Cash Ann Kolata Lang, Feeney & Associates 324 FUND Ziolkowski Construction, Inc. 414 SAMPLE -EWING Petty Cash Jonathan E. Baker 420 SBCDA Lehman & Lehman City of South Bend Baker & Daniels Upon a motion by Ms. Jones, seconded by Mr. Faccenda and unanimously carried, the Commission approved the Claims submitted November 1, 2002, and ordered the checks to be released. 4. COMMUNICATIONS Mr. Inks advised that a verbal request was received by Mr. Beitzinger to withdraw a personal property tax abatement application for WAV Industries, 2 911 149.00 87.69 185.84 200.18 25.20 84.98 206.55 400.00 1,024,112.00 6.00 400.00 2,790.17 2,333.52 636.50 $ 1.031.617.63 COMMISSION APPROVED THE CLAIMS SUBMITTED NOVEMBER 1, 2002, AND ORDERED THE CHECKS TO BE RELEASED. COMMUNICATIONS South Bend Redevelopment Commission Regular Meeting — November 1, 2002 4. COMMUNICATIONS (CONT.) LLC. The application was included on the October 18, 2002 Redevelopment Commission agenda as Item 6.A.1. and tabled at that meeting. 5. OLD BUSINESS There was no Old Business. 6. NEW BUSINESS A. Public Hearing (1) Public Hearing on Resolution No. 1916 expanding the boundaries of the Airport Economic Development Area, expanding the allocation area for purposes of tax increment financing and amending the Airport Economic Development Area Development Plan. Mr. Case reported that Expansion Areas No. 12, 13, 14 and 15 total approximately 54 acres of land located on Olive Road west of the U.S. 31 by -pass; Portage Avenue north of the 80/90 Toll Road; and north of the 80/90 Toll Road, west of the U.S. 31 by- pass (see attached map). The Airport Economic Development Area is being expanded in order to provide assistance for infrastructure improvements to the area and to allow for further development in the Airport Economic Development Area. The construction of the necessary infrastructure to serve the various parcels would be difficult to accomplish without the use of tax increment funds. The expected benefits of expanding the Allocation Area are as follows: L THERE WAS NO OLD BUSINESS. South Bend Redevelopment Commission Regular Meeting — November 1, 2002 C 6. NEW BUSINESS (CONT.) A. Public Hearing (1) continued... (1) Significant new job opportunities resulting from the new development as well as existing business expansion; (2) Increased and diversified tax base for the City and all other taxing units; (3) New private investment and development within the area; (4) Improved roadway access in the northwest portion of the City; and (5) New construction and rehabilitation opportunities, which will result in additional jobs in those industries. The tax increment generated from Expansion Areas No. 12, 13, 14 and 15 will be used along with the tax increment from the existing Airport Economic Development Area Allocation Area to reduce and eliminate factors that are limiting economic development. Mr. Inks requested that the following items related to the public hearing be entered into the record: (1) Affidavits from the South Bend Tribune and the Tri- County News that the Notice of Public Hearing was published in those newspapers on October 18, 2002; (2) A statement from Mr. Robert Case that on October 18, 2002, copies of the Notice of Public Hearing were sent to the affected property owners, registered neighborhood associations and taxing units; and (3) As of 10:00 a.m. this morning, no written remonstrances were received. C- South Bend Redevelopment Commission Regular Meeting — November 1, 2002 6. NEW BUSINESS (CONT.) A. Public Hearing (1) continued... Mr. Hunt opened the Public Hearing on Resolution No. 1916 and asked if there was anyone who wished to speak. There being no one who wished to speak regarding Resolution No. 1916, Mr. Hunt closed the Public Hearing for whatever action the commission wished to take. (2) Commission approval requested for Resolution No. 1876. Upon a motion by Mr. Faccenda, seconded by Ms. Jones and unanimously carried, the Commission approved Resolution No. 1916 ILexpanding the boundaries of the Airport Economic Development Area, expanding the allocation area for purposes of tax increment financing and amending the Airport Economic Development Area Development Plan. Mr. Inks requested that meeting items be presented in a slightly different order than listed on the agenda. There were no objections by the Commission. F. South Bend Medical Services District (1) Commission approval requested for Agreement by and between the South Bend Redevelopment Commission and Memorial Hospital of South Bend, Inc. relating to the Memorial Hospital Expansion Project. L COMMISSION APPROVED RESOLUTION NO. 1916 EXPANDING THE BOUNDARIES OF THE AIRPORT ECONOMIC DEVELOPMENT AREA, EXPANDING THE ALLOCATION AREA FOR PURPOSES OF TAX INCREMENT FINANCING AND AMENDING THE AIRPORT ECONOMIC DEVELOPMENT AREA DEVELOPMENT PLAN. South Bend Redevelopment Commission Regular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) F. South Bend Medical Services District (1) continued... Mr. Rock reported that on February 18, 2000, the area near Memorial Hospital was designated as the Downtown Medical Services District, an expansion of the South Bend Central Development Area. A Tax Increment Finance District (TIF) was also set up at that time to provide revenue for future improvements within the area. Currently, the main user in the District is Memorial Hospital of South Bend, Inc. The Downtown Medical Services District added to the South Bend Central Development Area in part, to facilitate the expansion of Memorial Hospital and provide for other ancillary health related services and ensure the availability of quality health care services in the City of South Bend. Ms. Greene noted that in order to accomplish the expansion of Memorial Hospital and other related services, the City and Memorial have agreed to enter into a development agreement. The Development Agreement contemplates a ten year public - private relationship between Memorial Hospital and the City of South Bend. Memorial Hospital has expressed its agreement to partner with the City in order to ensure the impact of the expansion on the neighborhoods and on the City itself will be enhanced as a consequence. The Agreement contemplates that the Expansion Project will occur over a long period of time. Memorial has already started L 6 South Bend Redevelopment Commission Regular Meeting — November 1, 2002 6. NEW BUSINESS (CONT.) F. South Bend Medical Services District (1) continued... its expansion by breaking ground on the Heart & Vascular Center. The Agreement has some flexibility for the parties' performance. Timing is not defined because certain properties need to become available and are in the process of being acquired to accomplish the project. There are also a variety of factors which may necessitate ongoing changes to the development plan. These factors were recognized within the negotiations of the Development Agreement. There are rezoning actions that Memorial Hospital will be taking related to the Expansion Project which the City, by the Agreement, has agreed to support and endorse. In addition, some reconfiguration of the streets in the area will be necessary in order to provide a more orderly transition of traffic and flow through and around the campus. The street reconfiguration will be in accordance with the mutual agreement of the parties, subject to final approval of various entities such as INDOT, the Common Council, etc. Memorial will be expanding not only their existing facilities, but it is anticipated that there will be additional ancillary services related to the hospital itself. Although those ancillary services are, obviously, not parties to the Agreement, these ancillary services will certainly bring additional investment and jobs to the City of South Bend. In addition to the investment due to ancillary C South Bend Redevelopment Commission Regular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) F. South Bend Medical Services District (1) continued... services, Memorial's investment in the expansion project will be in excess of $ l OOM. Ms. Greene acknowledged that there is an affirmative recognition within the Agreement as to the use of eminent domain, as it may become necessary to utilize this option to acquire some properties. It was noted that no properties are currently on the Commission's acquisition list related to the Memorial Hospital Expansion Project. Ms. Greene then introduced Mr. Ted Foti of Memorial Hospital. Mr. Ted Foti ave a background g g presentation on the hospital's continued growth and outlined the need for expansion which will allow Memorial to continue to perform the services that they have been entrusted with for the last 108 years. In December 2001 it became apparent patient demand was increasing and the hospital would need to expand to provide additional beds. A Memorandum of Understanding (MOU) with the City was executed. With St. Joseph Regional Medical Center's plans to leave South Bend, Memorial's expansion plans have accelerated. There are constraints associated with the size of the campus and the small amount of land available in development area. A reconfiguration of the campus is required, including the obvious immediate need for zoning changes which have already been L8 South Bend Redevelopment Commission Regular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) F. South Bend Medical Services District (1) continued... filed. Properties will need to be acquired, buildings demolished and streets relocated. The takeover of an existing fire station is also anticipated, with Memorial assisting the City in the construction of a new fire station built in a different location. New construction for the hospital will include a patient tower, additional medical office buildings and more parking facilities. Memorial continues to work closely with the City to ensure the project flows smoothly. Currently there are thirty-eight buildings in operation to manage both the healthcare and business operations of the hospital. There are 180 physicians on campus with a recruitment rate of 30 -35 doctors per year. In addition, memorial employs 3,600 people, with 200 -300 jobs being added approximately every six months. Memorial has invested $240M over the last six years in new development, including a $40M Trauma Emergency Room Center, and ground has just been broken for the new Heart Center which is expected to be completed within two years. The expansion project will add 70 to 80 new physicians to the campus. The project will also employ approximately 1,000 new employees. Mr. Foti advised that Memorial is working with a variety of planning and consulting groups. It is expected that alternatives will be narrowed within the next four to five L South Bend Redevelopment Commission Regular Meeting — November 1, 2002 6. NEW BUSINESS (CONT.) F. South Bend Medical Services District (1) continued... months and firm plans will be put in place. The goal is for the expansion project to be completed by the year 2007. Mayor Luecke addressed the Commission in support of the agreement with Memorial Hospital. He stated that Memorial Hospital is a premier corporate citizen for the City of South Bend. They are the City's largest employer and provide services that are second to none. He noted the difficulty Memorial faces to continue to grow and meet the expanding medical needs of the community in an urban setting. In terms of the Expansion Project, Memorial has demonstrated a willingness to plan not only with the City, but with adjacent neighborhoods. The City will be doing some public works, reconfiguring streets, etc., so parcels can work better for new construction. Mayor Luecke thanked Memorial for arrangements reached with respect to the relocation of Fire Station No. 2. It was noted that there will be additional adjustments to the project as the plan moves forward. In terms of expenses and costs, Mayor Luecke thanked the Commission for creating the Medical TIF District and advised that Memorial recognizes a portion of the facilities constructed will pay property taxes. The additional TIF will help the City cover expenses incurred creating new roadways and reconfiguring some of the existing roadways. Mayor Luecke acknowledged 10 South Bend Redevelopment Commission Regular Meeting — November 1, 2002 6. NEW BUSINESS (CONT.) F. South Bend Medical Services District (1) continued... Memorial Hospital's importance to South Bend and the major investment the hospital has made in the downtown. The City will support Memorial's expansion plans and is appreciative of the future investments being made. Mayor Luecke encouraged favorable action by the Redevelopment Commission. Mr. Hunt commented that the Redevelopment Commission was in full support of the expansion project and it is a great addition to the City. He further noted that the project is extremely important, particularly in light of St. Joseph Regional Medical Center's leaving the community. Upon a motion by Mr. Faccenda, seconded by Ms. Jones and unanimously carried, the Commission approved the Agreement by and between the South Bend Redevelopment Commission and Memorial Hospital of South Bend, Inc. relating to the Memorial Hospital Expansion Project. E. Airport Economic Development Area (1) Agreement by and among the City of South Bend, the South Bend Redevelopment Commission and Cooreman Real Estate Group, Inc. relating to the development commonly known as Villas at Lake Blackthorn and Westwood Knolls at Blackthorn. (40� 11 COMMISSION APPROVED THE AGREEMENT BY AND BETWEEN THE SOUTH BEND REDEVELOPMENT COMMISSION AND MEMORIAL HOSPITAL OF SOUTH BEND, INC. RELATING TO THE MEMORIAL HOSPITAL EXPANSION PROJECT. South Bend Redevelopment Commission ILRegular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) E. Airport Economic Development Area (1) continued... Mr. Rock updated the Commission on the development project contemplated. In addition to the 40 acres currently owned in the northwest area by Cooreman Real Estate, the Redevelopment Commission is selling an additional 19 acres to Cooreman which will become part of the development site. In Phase I, Cooreman Real Estate Group is proposing a development of 114 villas, ranging in price from $170,000 to $250,000. In the second phase, approximately 100 residential homes will be built, ranging in price from $150,000 to $300,000. The IL Board of Public Works is currently working on a sewer design. The sewer will run across the bypass, ending at Orange Road and leaving access for Phase II of the project. Cooreman Real Estate will be responsible for the infrastructure within the development itself. Mr. Steve Cooreman, Cooreman Real Estate Group spoke about his excitement for the project. The goal is to help grow South Bend "residentially" in the northwest area. The location of his development will be west of the.U.S. 31 bypass and north of Brick Road. The Cooreman Real Estate Group corporate offices are located near the site which positions it well to market the northwest community. In Phase I, a villa concept, the owner owns the land; however, all exterior maintenance is provided. This maintenance includes snow plowing, leaf raking, shrub trimming, etc. The IL 12 South Bend Redevelopment Commission Regular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) E. Airport Economic Development Area (1) continued... architectural controls will be uniform and complimentary. The targeted market is empty nesters and young professionals who travel a lot and will appreciate quick access to the bypass and toll road. The main feature of the Villa community will be a ten acre lake, stocked with fish, named "Lake Blackthorn." The homes constructed on the lake will be the more expensive homes. There will be an elevated park featuring a large gazebo and common area. The development will have attractive masonry entry walls which will welcome with a stately effect. For safety and good traffic flow, the villa community will have secondary access with an entrance off Orange Road. Phase II, Westwood Knolls at Blackthorn, will be built to County standards, but will have City water and sewer. There will be an annexation provision once continuity and requirements are met. All homes in Westwood Knolls will be residential. Cooreman Real Estate uses five custom builders, Devon Custom Homes; Berkey Custom Homes; Miller Builders; Old World Builders; and Signature Homes. Mayor Luecke expressed appreciation and gratitude to Mr. Cooreman for his work on the development project and the future investment in the City. It was noted that a policy of South Bend is to provide a wide 13 South Bend Redevelopment Commission jt� Regular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) E. Airport Economic Development Area (1) continued... range of housing opportunities within the city limits. The Mayor welcomed the residential addition to the South Bend market and recognized its potential role in capturing and keeping residents who are contemplating a move outside the City. Mayor Luecke encouraged a positive action by the Commission on the proposed Agreement. Ms. Greene explained that the development is an extremely unique project with unusual characteristics. Those circumstances gave rise to an equally unique Development Agreement which is not to be interpreted as setting a precedent for future phases of the Project, nor as a precedent for future development agreements. The Commission's action will be the transfer (sale) of property previously agreed to, commonly known as the Dale Park Parcel, to the Cooreman Real Estate Group, Inc. The Commission will be involved in the Project only to the extent that the Commission will be endorsing and supporting actions that will ultimately be taken by other units of government: the Board of Public Works; INDOT, which will have input into the traffic patterns; the County, involved in the second Phase of the project, Westwood Knolls at Blackthorn, which is currently in the County and will be voluntarily annexed into the City when development is complete. The Commission will have no authority over the County property except to the extent of (00� 14 South Bend Redevelopment Commission Regular Meeting November 1, 2002 J 6. NEW BUSINESS (CONT.) E. Airport Economic Development Area (1) continued... endorsement. The agreement is intended to be taken to the Board of Public Works at its next meeting for ratification. The Board of Public Works will be performing many of the actions contemplated by this agreement. The Commission has agreed by way of the agreement to allow Cooreman Real Estate Group the use of the name "Blackthorn" as a marketing tool. Mr. Faccenda requested clarification that the agreement is not intended to serve as a pattern for future development. Ms. Greene responded that the agreement with Cooreman Real Estate related to the development of the Villas at Lake Blackthorn and Westwood Knolls at Blackthorn is very unique and is not intended to set a precedent for future development agreements. Upon a motion by Mr. Kahn, seconded by Mr. Faccenda and unanimously carried, the Commission approved the Agreement by and among the City of South Bend, the South Bend Redevelopment Commission and Cooreman Real Estate Group, Inc. relating to the development commonly known as Villas at Lake Blackthorn and Westwood Knolls at Blackthorn. B. Tax Abatement (1) Commission authorization requested to sign tax abatement petition on behalf of Cooreman Real Estate Group, Inc. 15 COMMISSION APPROVED THE AGREEMENT BY AND AMONG THE CITY OF SOUTH BEND, THE SOUTH BEND REDEVELOPMENT COMMISSION AND COOREMAN REAL ESTATE GROUP, INC. RELATING TO THE DEVELOPMENT COMMONLY KNOWN AS VILLAS AT LAKE BLACKTHORN AND WESTWOOD KNOLLS AT BLACKTHORN. South Bend Redevelopment Commission Regular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) B. Tax Abatement (1) continued... Mr. Inks advised that the Commission is the current owner of the property which will be sold to Cooreman Real Estate Group, Inc. and, therefore, the Commission needs to be co- petitioner on the tax abatement. Mr. Beitzinger noted that the tax abatement request will be submitted by the South Bend Redevelopment Commission on behalf of Cooreman Real Estate Group, Inc. Upon a motion by Mr. Kahn, seconded by Ms. Jones and unanimously carried, the Commission authorized signing the tax abatement petition on behalf of Cooreman ILI Real Estate Group, Inc. (2) Commission approval requested for Resolution No. 1917 approving an application for real property tax deduction for property located at The Villas at Lake Blackthorn in the Airport Economic Development Area. (South Bend Redevelopment Commission for the benefit of Cooreman Real Estate Group, Inc.) Due to previous presentations, Mr. Beitzinger waived the staff project summary and reported on the abatement qualifications. The petitioner has not been granted any previous tax abatements. The properties are properly zoned for single family dwelling units, and no building permits have been pulled. The properties are located in the Airport Economic C, 16 COMMISSION APPROVED THE REQUEST TO SIGN TAX ABATEMENT PETITION ON BEHALF OF COOREMAN REAL ESTATE GROUP, INC. South Bend Redevelopment Commission Regular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) B. Tax Abatement (2) continued... Development Area, which is a Tax Incremental Allocation Area; therefore, the petition for real property tax abatement must first be approved by the South Bend Redevelopment Commission. A review of the Tax Abatement Ordinance finds that the petitioner meets the qualifications for a five year residential tax abatement. Based on an estimated project cost of $200,000 per house, the cost of each tax abatement is as follows: Mr. Beitzinger noted that the abatement schedule is for estimation purposes only and assumes constant tax rates. The true tax values will ultimately be determined by the actual assessed valuation and the then current tax rates. Upon a motion by Mr. Faccenda, seconded by Ms. Jones and unanimously carried, the Commission approved Resolution No. 1917 approving an application for real property 17 COMMISSION APPROVED RESOLUTION NO. 1917 APPROVING AN APPLICATION FOR REAL PROPERTY TAX DEDUCTION FOR PROPERTY LOCATED AT THE VILLAS AT LAKE BLACKTHORN IN THE AIRPORT ECONOMIC DEVELOPMENT Estimated taxes over 5 years Without abatement $26,825.81 With 5 year $19,241.55 abatement Estimated cost of $ 7,584.26 3 year abatement Mr. Beitzinger noted that the abatement schedule is for estimation purposes only and assumes constant tax rates. The true tax values will ultimately be determined by the actual assessed valuation and the then current tax rates. Upon a motion by Mr. Faccenda, seconded by Ms. Jones and unanimously carried, the Commission approved Resolution No. 1917 approving an application for real property 17 COMMISSION APPROVED RESOLUTION NO. 1917 APPROVING AN APPLICATION FOR REAL PROPERTY TAX DEDUCTION FOR PROPERTY LOCATED AT THE VILLAS AT LAKE BLACKTHORN IN THE AIRPORT ECONOMIC DEVELOPMENT South Bend Redevelopment Commission Regular Meeting— November 1, 2002 �rr 6. NEW BUSINESS (CONT.) B. Tax Abatement (2) continued... tax deduction for property located at The Villas at Lake Blackthorn in the Airport Economic Development Area. (South Bend Redevelopment Commission for the benefit of Cooreman Real Estate Group, Inc.) C. South Bend Central Development Area (1) Commission approval requested for the Sixth Amendment to Lease between the City of South Bend, Indiana by the South Bend Redevelopment Commission and American Partners, L.P. (Osco Drug, Inc., S. Michigan Street) Mr. Williams reported that the amendment was reviewed by the Legal Department and is satisfactory as to content. The amendment extends Osco's lease for an additional year, from December 31, 2002 to November 30, 2003. The annual amount of the lease remains the same at $48,928. Upon a motion by Mr. Kahn, seconded by Ms. Jones and unanimously carried, the Commission approved the Sixth Amendment to Lease between the City of South Bend, Indiana by the South Bend Redevelopment Commission and American Partners, L.P. (Osco Drug, Inc., S. Michigan Street) (2) Commission approval requested for Amendment to Contract for Purchase and Sale of Real Estate. (1" Source parking lot, Main & Jefferson) 18 AREA. (SOUTH BEND REDEVELOPMENT COMMISSION FOR THE BENEFIT OF COOREMAN REAL ESTATE GROUP, INC.) COMMISSION APPROVED THE SIXTH AMENDMENT TO LEASE BETWEEN THE CITY OF SOUTH BEND, INDIANA BY THE SOUTH BEND REDEVELOPMENT COMMISSION AND AMERICAN PARTNERS, L.P. (Osco DRUG, INC., S. MICHIGAN STREET) South Bend Redevelopment Commission Regular Meeting — November 1, 2002 6. NEW BUSINESS (CONT.) C. South Bend Central Development Area (2) continued... Mr. Mathia reported that in February 1998, the Redevelopment Commission signed a Contract for Purchase and Sale of Real Estate to acquire property located at 207 -211 South Main Street, which is the 1St Source parking lot. The property is owned by 1 St Source and is used for parking by the tenants of the First Bank Building at Main and Jefferson. The property is one of five parcels being assembled by the Commission in order to facilitate a development project on the southwest corner of Main and Jefferson. In 1998 the Commission and 1St Source agreed to a purchase price of $105,000 for the property. The price was based on the average of two independent appraisals. As a condition precedent to execution of the Contract, the Commission agreed to enhance the sellers existing Jefferson Street parking lot. During the design process, it was determined that the Jefferson Street parking lot could not accommodate the required number of additional spaces needed. 1St Source has proposed that the Contract be amended to increase the sales price from $105,000 to $170,000; to establish a closing date of December 24, 2002; and to convey the vacated portions of the alleys adjacent to the Jefferson parking lot. The seller has also agreed to construct, at its expense, improvements and landscaping around the Jefferson parking lot. The property is essential to completing the Main and 19 South Bend Redevelopment Commission Regular Meeting — November 1, 2002 6. NEW BUSINESS (CONT.) C. South Bend Central Development Area (2) continued... Jefferson development parcel, which is vital to the South Bend Central Development Area development plans. Ms. Greene advised that the original appraisals on the property were completed in 1997. The acquisition is related to a project which requires the purchase of five separate parcels that will become a combined site. A 60,000 sq ft office building is tentatively planned for the combined site, and this property is key to accomplishing that objective. It was determined that construction of an office building of such ILI size could not be accomplished while providing alternative parking for the tenants of the First Bank Building. Although the purchase price noted in the amendment is greater than the amount previously agreed upon, it is reasonable for several reasons including that with any potential condemnation action, more than the value of the property itself would be a consideration. Any damages the Commission would be obligated for with respect to impairment of the interest of the First Bank Building would also be a factor. During the negotiation process, Is' Source proposed to staff and legal counsel that the purchase price be increased to $170,000. The additional compensation takes into consideration the fact that the Commission's appraisals are several years old, the loss of parking spaces and the potential impairment r+'' 20 South Bend Redevelopment Commission Regular Meeting — November 1, 2002 6. NEW BUSINESS (CONT.) C. South Bend Central Development Area (2) continued... of the First Bank Building interest. Resolution No. 1921 approves an addendum to the existing contract that was executed in 1998 and it includes a finding that acquisition of the property is necessary and the purchase price is reasonable. Resolution No. 1921 also authorizes the signing of the completed documents when finalized. Upon a motion by Ms. Jones, seconded by Mr. Kahn and unanimously carried, the Commission approved Resolution No. 1921 approving the execution of an Addendum to Contract for Purchase and Sale of Real Estate and other related documents concerning acquisition of property located in the South Bend Central Development Area. Mr. Faccenda abstained from the vote. (3) Commission approval requested for Acceptance of Counter Offer for property located at 401 E. Monroe in the South Bend Central Development Area. (Key Bank Drive -In) Mr. Mathia reported that the property is located at 401 E. Monroe Street, the Key Bank Drive -In building in the River Glen Plaza. Resolution No. 1913 previously authorized an offer to be made on the property. The property was listed for sale at a price of $310,285 by Key Bank, the current owner. The Commission's offer was $273,00 based on the average of two appraisals. Key Bank made a counter offer 21 COMMISSION APPROVED RESOLUTION NO. 1921 APPROVING THE EXECUTION OF AN ADDENDUM TO CONTRACT FOR PURCHASE AND SALE OF REAL ESTATE AND OTHER RELATED DOCUMENTS CONCERNING ACQUISITION OF PROPERTY LOCATED IN THE SOUTH BEND CENTRAL DEVELOPMENT AREA. South Bend Redevelopment Commission Regular Meeting — November 1, 2002 L 6. NEW BUSINESS (CONT.) C. South Bend Central Development Area (3) continued... of $310,000 and provided an appraisal stating the value of the property at $400,000. In response to the counter offer, the Commission authorized the staff to engage in negotiations with Key Bank and to accept a price up to $310,000 for the property. The price ultimately agreed to was $310,000 and the owners' Acceptance of Counter Offer was signed. Mr. Mathia explained that acquisition of the property will assist the City in achieving the goals of the South Bend Central Development Area development plan and will play a vital role ILin meeting the objectives for long term development in the River Glen Office Park. Ms. Greene advised that the expansion projects on -going in the River Glen Office Park would eventually require additional property acquisitions. This parcel was "sale ready," and it was expedient to move forward as Key Bank had a competing bidder. It was noted that the purchase price of $310,000 is reasonable, given the property is vacant and no relocation costs will be incurred. Staff requested the Commission approve Resolution No. 1921 approving the execution of documents and ratifying the signatures of Ms. Greene and Mr. Inks on the Acceptance of Counter Offer. Upon a motion by Ms. Jones, seconded by Mr. Kahn and unanimously carried, the Commission approved Resolution No. 1921 and ratified the Acceptance of Counter Offer 22 COMMISSION APPROVED RESOLUTION NO. 1921 AND RATIFIED THE ACCEPTANCE OF COUNTER OFFER FOR PROPERTY LOCATED AT 401 E. MONROE IN THE SOUTH BEND CENTRAL DEVELOPMENT AREA. (KEY BANK DRIVE -IN) South Bend Redevelopment Commission Regular Meeting — November 1, 2002 6. NEW BUSINESS (CONT.) C. South Bend Central Development Area (3) continued... for property located at 401 E. Monroe in the South Bend Central Development Area. (Key Bank Drive -In) (4) Commission approval requested for proposal for professional services in the South Bend Central Development Area. (Appraisal work, 122 S. Michigan, Chocolate Cafe) Mr. Mathia reported that staff received two quotes for appraisal services relating to the expansion of the Chocolate Cafe located at 122 S. Michigan Street in the Central Business District. The proposals are as follows: Jerome E. Michaels, MAI $2,500 R. E. Pitts & Associates $2,000 Two appraisals are required and it was noted that both companies are MAI certified appraisers. Staff recommends accepting the proposals of Jerome E. Michaels, MAI and R. E. Pitts in the amounts of $2,500 and $2,000 respectively. Upon a motion by Ms. Jones, seconded by Mr. Faccenda and unanimously carried, the Commission approved the proposals from Jerome E. Michaels, MAI and R. E. Pitts for professional services in the South Bend Central Development Area. (Appraisal work, 122 S. Michigan, Chocolate Cafe) 23 COMMISSION APPROVED THE PROPOSALS FROM JEROME E. MICHAELS, MAI AND R. E. PITTS FOR PROFESSIONAL SERVICES IN THE SOUTH BEND CENTRAL DEVELOPMENT AREA.(APPRAISAL wORK,122 S. MICHIGAN, CHOCOLATE CAFE) South Bend Redevelopment Commission Regular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) D. Sample -Ewing Development Area (1) Commission approval requested for Resolution No. 1918 related to acquisition of property in the Sample - Ewing Development Area by eminent domain. Mr. Schalliol reported that in July 2001 several properties in the southeast neighborhood area were added to the acquisition list in the Sample -Ewing Development Area. Resolution No. 1918 sets the fair market value for seven separate properties, owned by five parties. The properties, owners and average appraised values are as follows: 2 Vacant Lots, W 622 Sample Burkhart Advertising $9,000 Vacant Lot, W 622 Sample Theodore Levee $3,025 Vacant Lot, E 722 Ohio Michael G. Beres $3,250 Vacant Lot, E 723 Ohio Michael G. Beres $3,250 Vacant Lot, E 715 Ohio John & Patricia Cocquyt $3,600 Vacant Lot, S 722 Ohio Grand Trunk Railroad $ 0 (Cost will be assessed pending discussions) 24 South Bend Redevelopment Commission Regular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) D. Sample -Ewing Development Area (1) continued... Upon a motion by Mr. Faccenda, seconded by Mr. Kahn and unanimously carried, the Commission approved Resolution No. 1918 related to acquisition of property in the Sample -Ewing Development Area by eminent domain. (2) Filing of Resolution No. 1919 determining to pay certain expenses incurred in the Sample -Ewing Development Area from Fund 433, the Redevelopment General Fund and setting a Public Hearing for November 15, 2002 at 10:00 a.m. Mr. Rock reported that the amount of the appropriation is $40,000. Upon a motion by Mr. Kahn, seconded by Ms. Jones and unanimously carried, the Commission accepted for filing Resolution No. 1919 and set a public hearing on Resolution No. 1919 for 10:00 a.m., November 15, 2002. (3) Commission approval requested for Resolution No. 1920 amending Resolution No. 1904 which authorized the issuance of Redevelopment District Special Taxing District Bonds, Series 2002. Mr. Inks reported that Resolution No. 1920 amending Resolution No. 1904 is related to the TJX Project and introduced Mr. Randy Rompola of Baker & Daniels for a brief presentation. 25 COMMISSION APPROVED RESOLUTION NO. 1918 RELATED TO ACQUISITION OF PROPERTY IN THE SAMPLE -EWING DEVELOPMENT AREA BY EMINENT DOMAIN. COMMISSION ACCEPTED FOR FILING RESOLUTION NO. 1919 AND SET A PUBLIC HEARING ON RESOLUTION NO. 1919 FOR 10:00 A.M., NOVEMBER 15, 2002. South Bend Redevelopment Commission Regular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) D. Sample -Ewing Development Area (3) continued... Mr. Rompola advised that the original bond issue is a tax backed revenue bond issue, and as a result, there is a need for a reserve fund. The reserve fund is typically funded out of bond proceeds which would require that the amount be raised to account for the reserve fund. Increasingly, surety bonds are being used, which are instruments issued by insurance companies, that provide bond insurance to provide for the funding of the reserve. The net effect would be that, instead of putting $600,000 or $700,000 aside, a surety bond is purchased for $30,000 with bond proceeds. Tthe savings is IL clear. At the time the Bond Resolution was adopted, the bond insurer had not been selected; therefore, no language was included at that time. The bond insurer and provider of the surety bond has now been identified as Ambac Assurance Corporation. The Bond Resolution has been amended in Section 4, adding a Debt Service Reserve Account and providing for the payment mechanism in the event the City did not make a timely payment. Section 22 adds relatively boilerplate language required by Ambac to provide bond insurance. There is a change in the original bond resolution on page three, paragraph B, line 4. The amount of the reserve has been identified as an amount equal to the maximum principal of and interest on the bonds due in any eighteen month period. The bond sale is scheduled for November 13, 2002. 26 South Bend Redevelopment Commission Regular Meeting — November 1, 2002 6. NEW BUSINESS (CONT.) D. Sample -Ewing Development Area (3) continued... Upon a motion by Mr. Faccenda, seconded by Ms. Jones and unanimously carried, the Commission approved Resolution No. 1920 amending Resolution No. 1904 which authorized the issuance of Redevelopment District Special Taxing District Bonds, Series 2002. (TJX Project) E. Airport Economic Development Area (2) Commission approval requested for extension of time for construction in the Airport Economic Development Area. IL (Deluxe Sheet Metal) Mr. Case reported that Mr. Kevin Smith, President of Deluxe Sheet Metal, has requested an extension of time for construction of a facility being built in the Blackthorn area. The original completion date of the project was June 25, 2002. Mr. Smith has previously been granted an extension of time which expired October 31, 2002. Mr. Smith is requesting an additional extension of time until April 30, 2003 allowing additional time for completion of the project and more favorable move time of equipment, machinery and personnel. Upon a motion by Ms. Jones, seconded by Mr. Kahn and unanimously carried, the Commission approved the request for extension of time for construction in the Airport Economic Development Area. (Deluxe Sheet Metal) C27 COMMISSION APPROVED RESOLUTION NO. 1920 AMENDING RESOLUTION NO. 1904 WHICH AUTHORIZED THE ISSUANCE OF REDEVELOPMENT DISTRICT SPECIAL TAXING DISTRICT BONDS, SERIES 2002. (TJX PROJECT) COMMISSION APPROVED THE REQUEST FOR EXTENSION OF TIME FOR CONSTRUCTION IN THE AIRPORT ECONOMIC DEVELOPMENT AREA. (DELUXE SHEET METAL) South Bend Redevelopment Commission Regular Meeting — November 1, 2002 6. NEW BUSINESS (CONT.) H. Other (1) Commission approval requested for Resolution No. 1914 approving a Declaratory Resolution for the designation of the South Side Development Area (SSDA). Mr. Schalliol reported on the starting of the designation process of the South Side Development Area (SSDA). Resolution No. 1914 and the Development Area Plan must first be approved by the Redevelopment Commission as declaratory. The SSDA will then go before the Area Plan Commission on November 19, 2002, and finally the Common Council. In late IL December approval of a confirmatory resolution would be required by the Redevelopment Commission. The SSDA extends from Ewing to south of the bypass, from the western city limits on Ireland to east of Ironwood. The SSDA is the fifth development area in the City of South Bend. The south side area is being declared a redevelopment area because it meets the statutory requirements for blight. Blighted areas have eight key components which are: ► lack of development ► cessation of growth ► deterioration of improvements ► character ► occupancy ► age ► obsolescence ► substandard buildings and other factors that impair value or prevent the normal use or development of the property. 28 South Bend Redevelopment Commission Regular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) H. Other (1) continued... The designation of blight is not specific to a property, but to the general conditions of the entire area. The South Side area consists of brownfield conditions and greyfield conditions (specifically related to the Scottsdale Mall property). In the past ten years, development has been extremely slow and there are very few development parcels available. Mr. Schalliol distributed the South Side Development Area Plan to the Commission which consists of an overview of the goals, objectives, history and general conditions of the area. The area is divided into four sub -areas as follows: 1) East Ireland Road 2) Central Erskine Hills 3) South Gateway 4) Northern Michigan & Main Commercial Corridor Referencing financial and funding mechanisms, the SSDA will be declared as a TIF allocation area. In addition, the Erskine Hills area will also be declared a Sales Tax Increment Finance (STIF) District. Ms. Greene noted that Resolution No. 1914 is the initial declaratory resolution as contemplated by Indiana Code 36- 7 -14 -1. Assuming the Commission approves Resolution No. 1914, it is then sent to the Area Plan Commission along with the Development Plan for approval by Area Plan. Once Resolution No. 1914 is 29 South Bend Redevelopment Commission Regular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) H. Other (1) continued... presented to the Area Plan Commission and approved, it next goes to the Common Council, along with any amendments by the Plan Commission for approval by the Council. The Redevelopment Commission would then adopt a confirmatory resolution which will include a conceptual plan to alleviate blight conditions. A public hearing on the confirming resolution Development Area Plan will also be held at that time. Ms. Greene advised that the finding of blight set forth in the proposed findings and declaratory resolution is not directed at a particular property, but expressed the general condition of the area. Once a development area is declared by way of a resolution, the Commission is then permitted to utilize the development tools that the statute allows, thereby facilitating opportunities for new growth, businesses, jobs and overall improvement in the development area. Resolution No. 1914 specifically sets forth a finding of blight and gives the development area a name, being the "South Side Development Area ". It also approves the South Side Development Area Development Plan, together with all maps, plats and surveys which are included and assures development of the area will be in accordance with the plan presented to the Commission. In addition, Resolution No. 1914 approves a relocation policy that is consistent with past development area relocation policies. Resolution No. 1914 30 South Bend Redevelopment Commission Regular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) H. Other (1) continued... declares an allocation area for the purpose of capturing a tax increment. The allocation area has specific uses set forth in the statute as to how the tax increment can be utilized and the declaratory resolution sets forth those uses. Ms. Greene noted there are currently no properties on the acquisition list for the SSDA. Mayor Luecke expressed that the South Side Development project is particularly welcomed. With Scottsdale Mall not performing to potential, the south side is in need of additional retail opportunity. In addition, there have been ongoing efforts by Mr. Jim Frick and the South Gateway commercial corridor area to which the expanded boundries will undoubtedly be an asset. The south side area is currently underdeveloped and is prime for redevelopment. The mayor acknowledged challenges ranging from environmental to lack of investment, but added with the assistance of the declaration of a new development area, moving forward will be beneficial to the south side, as well as all of South Bend. Mayor Luecke encouraged a favorable recommendation from the Commission. Mr. Jim Frick, South Gateway Association noted that the association has 193 members, many located on Ireland Road, Michigan and '' 31 A 6A South Bend Redevelopment Commission Regular Meeting— November 1, 2002 6. NEW BUSINESS (CONT.) H. Other (1) continued... Main Streets. Mr. Frick expressed excitement about upcoming projects and the future of the area. The South Gateway Association is 100 percent behind the new development area. Upon a motion by Mr. Faccenda, seconded by Ms. Jones and unanimously carried, the Commission approved Resolution No. 1914 approving a Declaratory Resolution for the designation of the South Side Development Area (SSDA). 7. PROGRESS REPORTS Mr. Hunt complimented the staff for all the diligent work which has been demonstrated on recent projects. The Commission's appreciation was expressed. Mr. Inks noted the importance of the efforts of Mr. Jon Hunt, Executive Director of Community and Economic Development on the projects presented. 8. NEXT COMMISSION MEETING The next Regular Meeting of the Redevelopment Commission is scheduled for November 15, 2002 at 10:00 a.m. 32 COMMISSION APPROVED RESOLUTION NO. 1914 APPROVING A DECLARATORY RESOLUTION FOR THE DESIGNATION OF THE SOUTH SIDE DEVELOPMENT AREA (SSDA). PROGRESS NEXT COMMISSION MEETING . r L, an A South Bend Redevelopment Commission Regular Meeting— November 1, 2002 9. ADJOURNMENT There being no further business to come before the ADJOURNMENT Redevelopment Commission, Mr. Faccenda made a motion that the meeting be adjourned. Ms. Jones seconded the motion and the meeting was adjourned at 11:36 a.m. DD Robert W. Hunt, President 33 Doriald E. Inks, Director