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HomeMy WebLinkAbout09-10-18 Council Minutes REPORT OF SUB-COMMITTEE ON MINUTES TO THE COMMON COUNCIL OF THE CITY OF SOUTH BEND: THE SUB-COMMITTEE HAS INSPECTED THE MINUTES OF THE September 10,2018 MEETING OF THE COUNCIL AND FOUND THEM TO BE CORRECT. THEREFORE,WE RECOMMEND THE SAME BE APPROVED: TIM SCOTT TESAId APPROVED BY THE COMMON COUNCIL ON: September 24, 2018 ATTEST: REEMAH F WLER, CITY CLERK REGULAR MEETING September 10, 2018 Be it remembered that the Common Council of the City of South Bend, Indiana met in the Council Chambers of the County-City Building on Monday September 10th, 2018 at 7:00 p.m. The meeting was called to order by Council President Tim Scott and the Invocation (Councilmember Oliver Davis) and Pledge to the Flag were given. ROLL CALL COUNCIL MEMBERS PRESENT: Tim Scott 1St District, President Regina Williams-Preston 2nd District Sharon L. McBride 3`d District Jo M. Broden 4th District Jake Teshka 5th District Oliver J. Davis 6th District,Vice President Gavin Ferlic At-Large, Chairperson Committee of the Whole Karen L. White At-Large COUNCIL MEMBERS ABSENT: John Voorde At-Large OTHERS PRESENT: Kareemah Fowler City Clerk Jennifer Coffman Chief Deputy Clerk Bianca Tirado Deputy Clerk Graham Sparks Clerk Executive Assistant Bob Palmer Council Attorney Elivet Navarro Public Relations Intern Gabriel Murei City Clerk Intern REPORT FROM THE SUB-COMMITTEE ON MINUTES Councilmember Gavin Ferlic made a motion that the minutes of the August 27th, 2018 meeting of the Council be accepted and placed on file. Councilmember Oliver Davis seconded the motion which carried by a voice vote of eight(8) ayes. SPECIAL BUSINESS BILL NO. 18-41 A RESOLUTION CONGRATULATING THE SOUTH BEND EASTSIDE YOUTH CAL RIPKEN BASEBALL AND SOFTBALL TEN (10) YEAR OLDS FOR MAKING IT TO THE WORLD SERIES PLACING FORTH (4TH) PLACE AND RECEIVING THE SPORTSMANSHIP AWARD OF THE SERIES. Councilmember Tim Scott, 711 Forest Avenue, South Bend, IN, served as the presenter for this bill. Councilmember Tim Scott stated, Whereas, the South Bend East Side IOU All Star Team began their tournament in South Bend where they hosted the IOU Cal Ripken State Tournament. 1 REGULAR MEETING September 10, 2018 They went undefeated in the state tournament winning five (5) games, giving up only three (3) runs in all five (5) games; and; He continued, Whereas, After winning the state tournament, they advanced to the Ohio Valley Regional Tournament in St. Johns, Indiana. South Bend East Side went five (5) and one (1) in the regional tournament, beating six (6) teams from Kentucky, Southern Indiana, Wisconsin, and Mattoon, Illinois in the championship game six (6) to four (4) to advance to the World Series in Vincennes, Indiana played in the National Division; and, Councilmember Karen White, 1912 Malvern Way, stated, Whereas, South Bend East Side competed in the World Series with a record of four(4) and four(4), competing against teams from Florida, Mississippi, Pennsylvania, Alabama, Kentucky, Washington, Massachusetts, Hawaii,the Pacific Southwest Region, and the Southeast Region. The young men of the East Side 10U Baseball Team left it all on the field, finishing fourth(4th) in the nation. They were the runner up in the Ironman Bracket and was the one(1)team to receive the distinguished Sportsmanship Award out of the entire tournament. The award was given to each of the South Bend Eastside Players; and, Councilmember Sharon McBride, 415 E. Broadway Street, stated, Whereas, Two (2) players received individual awards for their play in the Series. Kamauri Austin won the Gold Glove Award for playing center field and made the All-Star Defense Team, and Franco Biffle, Jr. won the Wooden Bat Award and made the All-World Series Team. Only eleven (11) individual awards were given out of over 300 players. The members of the East Side Baseball Team include: City Clerk Kareemah Fowler, Offices on the 4th Floor of the County-City Building, stated, Manager: Franco Biffle, Sr., Coaches: Scott Hartford, Tim Kelly, Matt Ruszkowski, Players: Kamauri Austin, Franco Biffle, Jr., Caden Kelly, Bennett Hartford, Weston Hoke, Payton Horner, Ryder Place, Ryan Ruszkowski, Lucas Short, Pierson Sult, Gavin Taylor, and Jordan Thomas. She continued, Now, therefore, be it proclaimed by the Common Council as follows: Section I. On behalf of the citizens of the City of South Bend, Indiana, and as elected Members of the South Bend Common Council, we are pleased to publicly congratulate the South Bend East Side 10U Baseball Team. Section II. Congratulations to the South Bend East Side IOU Baseball Team. We wish you more success in the coming years. Signed this 10th day of September in the year 2018 in the City of South Bend, the County of St. Joseph, in the State of Indiana. Section III. This Resolution shall be in full force and effect from and after its adoption by the South Bend Common Council and approval by the Mayor. Congratulations. Franco Biffle, 831 S. 35th Street, I just wanted to thank you. I am very proud of these boys. They worked very hard to achieve their goal this year and they accomplished it. They grew over the summer, as they were ten (10) and now they are all eleven (11). It is a great start to the school year, and I am very proud of the boys. Jordan Thomas, 1411 Northside Blvd., stated about his team, They're good! This being the time heretofore set for the Public Hearing on the above bill, proponents and opponents were given an opportunity to be heard. Mayor Pete Buttigieg, Offices on the 14th Floor of this building, stated, I just wanted to add to Clerk Fowler and the Council in expressing our pride in this team. I do think it is appropriate, since we all know that we don't achieve anything without the support of our families, for these gentlemen to lead a round of applause for the parents and the other family members who are here to support them. So with that, gentlemen, I just want to let you know that your City is proud of you, and that we expect the same leadership traits that you've learned on the field, especially sportsmanship,to make you leaders in the classroom, and on the field, and eventually for our City. Congratulations again. Councilmember Regina Williams-Preston stated,I just want to thank you for representing the City of South Bend the way you have. It's an amazing achievement to be in the World Series, and to 2 REGULAR MEETING September 10, 2018 achieve such a high ranking. Number four (4) is fantastic! But even moreso, to let everybody in this country know that the children of South Bend have great sportsmanship,that you are leaders. We really appreciate you for putting that on display for all to see. Thank you so much. Councilmember Jo M. Broden stated, Congratulations! As I listen to the teams that you competed against, I think some of those teams have weather in their favor in terms of their ability to play nearly year-round ball. So I know your commitment when you step on the field must just go out the roof. Thank you for working so hard, and for this wonderful achievement. I know East Side has a terrific winning tradition, so you represented your park well. We're proud of you, your parents are proud of you, the Mayor is proud of you, the coaches are proud of you, and I'm sure you're proud of yourself. Even the little siblings in back are proud. Congratulations, and keep up the good work. Councilmember Jake Teshka stated, I've been able to follow your success this year, thanks to our proud City Clerk Kareemah Fowler. She is proud of you and we all are. It's one thing to have great athleticism,but one(1)thing everyone has noted is the sportsmanship. You guys represented our City so well in that arena. I echo the Mayor's sentiments and I encourage you to keep that up in the classroom and in the hallways at school, and in everything that you do throughout the rest of your lives. Sportsmanship is such a valuable trait to have. Councilmember Gavin Ferlic stated, Congratulations, especially on the sportsmanship award. We're really proud of you. Councilmember Oliver Davis stated, You all play in the Cal Ripken League. None of you were here when he played. Your parents saw Cal Ripken play. He had the record for most games played, and I remember watching him play for Baltimore. He played in 6,032 straight games. He stayed there and he always played, no matter what, and we want you to follow that strength of being able to stand in the game and do well. We appreciate you and we are encouraged by you and your families. Councilmember Gavin Ferlic made a motion to adopt the legislation by acclamation. Councilmember Jo M. Broden seconded this motion which carried unanimously by a voice vote of eight (8) ayes. REPORTS OF CITY OFFICES Representing the City Administration: Laura O'Sullivan, Chief of Staff RESOLVE INTO THE COMMITTEE OF THE WHOLE There was no Committee of the Whole at this time. PUBLIC HEARINGS There were no Public Hearings at this time. BILLS—THIRD READING There were no Third Readings at this time. 3 REGULAR MEETING September 10, 2018 RESOLUTIONS BILL NO. 18-42 A RESOLUTION MODIFYING AND RECONFIRMING THE ADOPTION OF DECLARATORY RESOLUTION NO. 4461-15 DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS 106-110 NORTH MAIN ST., SOUTH BEND, IN 46601 AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF A (10) TEN YEAR REAL PROPERTY TAX ABATEMENT FOR HISTORIC JMS BUILDING, LLC Councilmember Gavin Ferlic, Chair of the Community Investment Committee, reported that they met this afternoon and send these bills forward with favorable recommendations. Councilmember Gavin Ferlic made a motion to hear Bill Nos. 18-42, 18-43, 18-44, 18-45, 18-46, 18-47, 18-48, 18-49, 18-50, 18-51, and 18-52 together. Councilmember Jake Teshka seconded this motion which carried by a voice vote of eight (8) ayes. James Mueller, Executive Director of the Department of Community Investment with offices on the 14th floor of the County-City Building, stated, Tonight, we'll be looking at the overview of these abatements, the economic and process context for why these are coming before you, the resolutions themselves and some of the project outcomes and reassessments that we've already seen. These are familiar projects: the JMS right around the corner, Holiday Inn south of town,the Courtyard Marriott between the Chocolate Caf6 and the Century Center, the Hall of Fame just north of that,the Studebaker just south of Four Winds Field, Imagineering Enterprises on Sample, and the Liberty Tower just around the corner. He continued, The number of abatements has risen since 2010 to 2015, the economic conditions have improved, and the business activity, as you can see in the graph on the right (referring to the presentation available in the City Clerk's Office) of the downtown building permit values by year, you see that 2016-2017 jumps off the page compared to previous years. There were plenty of booms and busts that the City experienced where South Bend didn't see this kind of investment going on in their downtown. This is really exciting news, and these tax abatements have much to do with a lot of this investment downtown. You can also see the difference in the scale of these projects. The average in 2010 was $2.4 million in investment per abatement, in 2015 it was $4.5 million. Projects are getting bigger, there is more investment, and they are also becoming more complex. Finally, there is a process issue that we've learned of over time. When we do a tax abatement,there is a designation period, but you don't have that assessed value until the Assessor actually reassesses the project after the investment, and you have to do that before the designation period ends. Mr. Mueller referred to the presentation for a summary of the value of private investment from the tax abatements over the past seven(7) years, and stated, As you see, 2015 was a high point. All of the tax abatements coming before you tonight were from the 2015 and 2016 timeframe. There is a significant jump there in what the tax abatement was able to attract in private investment. Similarly, here, you see jobs that were announced with that. We are now getting CF-ls showing actual job creation and actual investment, now that most of these projects have completed. You see the real property tax abatements. We had $85 million of announced, and we've seen $120 million with personal property tax abatements, $123 million versus $144 million and then the investment is a little low right now because a couple of the projects haven't completed. The assessed value that we projected was a little higher than what we've seen in the CF-1's so far,but that is also as you'll see in a moment, the full assessment. The Assessor does a reassessment on January every year, so there is a partial assessment until you get the full assessment on the books, we won't see that. The tax abatement timeline, from the process standpoint, is that a 4 REGULAR MEETING September 10, 2018 petitioner submits a petition packet, and an SB-1 Form, as required by Municipal Code. The Department of Community Investment analyzes this petition and brings it before Council to receive an up or down vote. For the approval process in the Council portion,there is a designating resolution, followed by a confirming resolution, then a memorandum of agreement is forged between the City and the recipient. Then the project goes on with the investment and the construction, or whatever else was agreed to in the MOA commences, and on the back end there is reporting with CF-1 Forms,there is the reassessment from the Assessor and Form 11, then DCI does its annual tax abatement report. Personal Tax Abatements are for a length of five (5) years, Real Tax Abatements are for three (3) to ten (10) years depending on the project, and then the designation period can be two (2) or more years. The abatements before you were two (2) years originally, except for the Hall of Fame, which was three (3). He Continued, Referring to the presentation, Mr. Mueller stated, On January 1St, is the effective reassessed value for that tax year. The Assessor doesn't go around the entire City to reassess things on day one (1), but that's when they have to estimate the assessed value gain valid for that year. On May 15"', CF-1 Forms are due, in June our annual tax abatement report to Council is due, and then between July and the fall, the Assessor provides the reassessment based off the January 1 Sc value to the recipient in a Form 11. If you gave a designation period for a tax abatement of two (2) years, as we do commonly, and they have a common eighteen(18) month project,there are no delays and it goes on as planned, if you granted the tax abatement in October, there would be a partial assessed value following January 1', then the project continues all the way through that year,there is a partial reassessed value based off of that construction that year on Januar 1'. The project concludes on time in April, and that is well before the October two (2)-year designation period ends. They won't get their full assessed value on the project until the following January 1St, they won't receive the Form 11 of July or September of that year, so they won't actually pay this until the year after that. He stated, They were all two (2) years before, except for the Hall of Fame which is three (3), and now they are all proposed to be four (4) years with the exception of Imagineering which is three (3)years for the Personal and Real Property Tax Abatements,and the portions of the Liberty Tower that have not been completed, we're proposing to go to five (5) years as they are hoping to complete next year. Referring to the summary of the project outcomes in the presentation, he stated, the four (4) columns on the right show what was committed to. The second (2"d) two (2) columns are the announced amount that was committed to in the MOAs, and the two (2) columns to the left of that are what we've seen so far. He continued, One (1) thing to note is that the job commitments are required to be fulfilled over the length of the tax abatement, not necessarily right when the tax abatement starts. The status of where their assessed value is in 2018 and 2019, and the status of their Form 11. We are not asking for an extension of the tax abatement length itself, we are not asking for a change in the terms of the tax abatement, what we're doing is allowing the projects to qualify for the tax abatement we already agreed to, based off the designation period and getting it done and reassessed in time to receive those benefits. With that, I'd be happy to answer any questions. Councilmember Oliver Davis stated, My biggest concern is that we are going to have to revamp our abatement policies because that argument could be used throughout many of the abatements that we've had, based on the issue of when they are actually approved here, and when they get going depending on what is going on in terms of the different projects that happen. So the timeframe would impact a lot where you could start a trend where you see many of the businesses that currently have abatements will now come back to us to do likewise. Mr. Mueller stated, In committee, some of your colleagues recommended that now that we have a better understanding of the process, we should set the designation period to be more amenable to the process, so projects that stay on schedule do not have to come back for these types of changes. Projects can face delays for any number of reasons. Liberty Tower has already invested over$10 million more than they promised for doing all four (4) components, but they've only completed two (2) of the components. There are inevitabilities in development projects that they may need 5 REGULAR MEETING September 10, 2018 more time to complete the project and get reassessed within a designation period. Those will always exist, but we hope to see fewer in the future as we fix up this designation period issue. Councilmember Davis asked, Is there any way we can fix this prior to us having people attached to this? Where we just have a meeting to review our abatements, to sit back and look at these issues, and not tie them into a vote? That's been my biggest concern, when the issue of making those changes is now tied to the different eleven(11)businesses here. We need further information of how to put this all together, to send this through with a vote is my concern. How do you deal with the issue of not harming them, but at the same time, not setting a precedent for other people behind you? The other businesses can make the same arguments, and that's a serious concern. Mr. Mueller responded, The designation period is not required in statute, so there is nothing to amend outside of the specific tax abatement resolutions with individual tax abatements, so we couldn't amend anything in the code to do that as a blanket. We'll adopt a policy going forward that is more amenable to the process. Councilmember Davis asked, Can we adopt a policy, and it be connected in coming times? On a night where we just do strictly policy and not attach business to it. I don't have a problem making adjustments for policy, but I have a problem with making all of those connected with businesses and policy all in the same. We get a packet on Thursday, and we get emails asking what's going on here, and that creates the fact that we can't come back and justify what's going on because we don't have a policy, we're just making this outside of that. Mr. Mueller stated, We are just trying to adapt our informal policy from before. Councilmember Davis asked Attorney Bob Palmer, What kind of policy do you see us putting together to address this sort of thing? Council Attorney Palmer answered, I think that is a function of DCI to come up with their own internal policy, to set a designated period that is reasonable given the scope of the projects that come before us on tax abatements. They've been overly optimistic so far, and in setting these designating periods hoping everything will be completed and reassessed within two (2) years, when in reality through delays in construction or in reassessment, those overly optimistic designation periods just don't pan out. This doesn't change any economic effects, they just need to become more realistic with the larger redevelopment projects that are coming before the Council. Councilmember Davis asked, Are you saying this doesn't need to have a Code change? It just needs to have a policy change? And we don't approve that policy, it has to be a policy within the department? Mr. Palmer replied, That's correct. Councilmember Davis asked, Therefore, they could have changed that policy before they came here today? Mr. Palmer stated, It wasn't their policy at the time you passed the tax abatements in 2015 and 2016. Councilmember Davis asked,But could they have changed that policy in the Executive Branch, or does that have to come before us? Mr. Palmer stated, They can change the policy anytime they choose to, but because these already had been designated time periods, they had to come back and be reconfirmed by the Council. Council President Scott added, It is required by state statute. Councilmember Davis stated, That's my concern with everybody's abatement that is currently out there. They then all have to come back through us. Mr. Palmer stated, Only the abatements that have not been completed and reassessed within their original designation period. I assume that you've caught as many of those as you could. 6 REGULAR MEETING September 10, 2018 Councilmember Davis asked, So there are no more of those that are coming before us? Mr. Mueller stated, There could be, there could be project delays that cause it as well. President Scott stated, We did talk about this in committee, and one (1) note that I brought up is that since I've been on Council the last seven (7) years, we've had four (4) directors of DCI. I think they're being proactive to try to understand and correct the policy. You can set a policy, and there will be a basic standard that you're concerned with,and I agree with that. Then,you're going to have to look at it on a case by case basis. Some projects go through on time, everything is by the book and its fine. As new cases come up, they're going to be able to expand to the proper policy. Councilmember Ferlic stated, I agree with Councilmember Davis that any sort of policy changes in the next month or two (2), DCI could come before Council and explain the new policy moving forward, I think that would be beneficial. Council President Scott explained,If they are on the books and they've been voted on by this body, by state statute they have to come back to us and we would have to vote on those changes like we are going to do tonight. Councilmember Davis stated,You want everything to be caught up,but then you bring out another good point, that how do you establish a case by case basis when we have all eleven(11)here, and we don't have the time to actually go through each of the eleven (11) to evaluate each situation? That's where my concern is. I'm at peace. Councilmember Broden asked, One (1) or two (2) projects actually had no investment per your chart and per what was submitted. Could you clarify what the actual investment going forward is, if we were going to be granting that particular extention? Council President Scott interjected,And these resolutions were brought forth by DCI. Each of the stakeholders are here for support data for DCI's resolution. If anyone has any questions for them, we can bring them up. This is different than usual because they are not the actual petitioners in this case. Mr. Mueller stated, Starting with the Liberty Tower, the original investment across all four (4) pieces was roughly $30 million. They've already invested $38.5 million for the hotel and garage components. They're estimating an additional $15 million. They've already matched their commitment toward investment. Councilmember Broden asked,For Imagineering Enterprises, I think it would be instructive for us as Council as we are looking to extend this, with regard to that particular project,to note that they didn't hit all of the marks. Going forward, what is going to be the specific level of investment? Perhaps the individuals could address that better. Mr. Mueller stated, For Imagineering, It's not changing the terms of the abatement at all, it's just changing the designating period. Councilmember Broden asked, With regard to precedent issues, and a full understanding of additional petitioners coming before us,what is your sense? This is eleven(11),and we've already done four(4) or five(5)previously. What are we looking at before the end of theme or in 2019? Mr. Mueller stated, This takes care of those from 2015 and 2016, we've tried to figure out a way forward where we don't have these moving forward. There is a time between 2017 and 2018. We've reached out to folks,but people are always optimistic that they won't need to make a change before their deadline is here, so there are probably a few more that may come. There are actually a few delays that the projects might encounter. You look at the results of all of these abatements and the growth of downtown investment, these projects wouldn't happen without the incentives. Booms and busts have come and gone and South Bend hasn't seen that level of investment. From the Administration's perspective, as long as they're hitting their investment targets and their other substantial commitments, we'll do that every day of the week because it's a great thing for the City. Tax abatements are only on the increase of revenue,so it should more appropriately be called tax phase ins, because you're not losing any revenue. These projects wouldn't have happened, and we wouldn't be abating anything because nothing would have been generated. For these projects, we're losing zero (0) tax dollars, but adding over time. Council, over time, has demonstrated that they believe in this, too, and that these are wins for our community. REGULAR MEETING September 10, 2018 Councilmember Broden explained, I think that your presentation this afternoon went a long way, as well as the individual petitioners talking about the delays that they've encountered. I think that helps all of us,not just the folks sitting up here,but the folks we represent. They need to understand and want to understand these issues and what are the challenges. Thank you for the presentation. I appreciate the earlier discussions on this and look forward to streamlining and figuring out where the information gaps are, not just in the Assessor's office. The forms are going out by law, and if the forms aren't getting there, they should be returned to the Assessor. I also would like to know where there is any wiggle room within the annual assessment process, and what information we could feed into this really critical January 1 st date, whether it's the building plans, or the investment to date. If the project is partially completed or fully completed, we've got a better understanding of that and it should actually be reflected in the paperwork. I am really eager to look at the change in policy and the process that mitigates it. I don't want to just jump reflexively to a four (4) year designation period, because I think there is something about the two (2) year period. That conversation and what the give and take on that would be, will be an interesting one (1) to be part of. Councilmember Teshka stated, Thank you for clarifying that the abatements are on the increase. Do you have the slides from the presentation that you did back in December with a really simple graphic? That would be helpful. Mr. Mueller stated, I don't know that we have the graphic. Councilmember Teshka stated, I will use that graphic moving forward when talking about tax abatements. Mr. Mueller clarified, The graphic was on TIFs, but it is similar. Councilmember Teshka agreed and asked, Are the numbers in the modified designation periods the total numbers? If two (2) years already lapsed, then we are adding three (3) more years for a total of five (5) years? Mr. Mueller stated, That is correct. Councilmember Davis asked,We are not the only City in the State of Indiana that uses abatements. What have been the best practices that you have gathered from other cities when they've had these situations? How do they handle these matters? Mr.Mueller stated,We can certainly look into it more. There are different markets, so Indianapolis has a different market structure than we do. We could look at more comparable cities. We know what Mishawaka does, for example. In December's presentation we looked through a couple of cases. We can bring that back up and show you. Councilmember Davis stated, What do they do when they have these kinds of challenges? Mr. Mueller answered, Legally, the resolutions have to be amended if that's what's in the resolutions. Whether they started out with longer designation periods originally, we can look at different cases. Once we start with the two (2) year period, if that's not working for us, we have to come back with this mechanism. Councilmember Davis asked, Did you look at any other cities in the State of Indiana to see how they handle these kind of best practices? Mr. Mueller answered, We have not done a comprehensive look. Councilmember Teshka asked, I believe we talked about this briefly in committee, but can your office work more directly with the County Assessor's office to make sure that these assessments are happening on a priority basis? Because we have this phase in in place, can we make sure that we're doing those more quickly. Mr. Mueller stated,Absolutely. We think there are two (2)key places where we can work with the Assessor's office from our end. One (1) is to make sure that all of these properties that have tax abatements are flagged, that could be as simple as forwarding the annual tax abatement report to make sure they have it in their records. The second (2nd) piece is if we're able to get them construction cost estimates from either the building design or what have you so they have some basis to work off of before having to reinvent the wheel. 8 REGULAR MEETING September 10, 2018 Councilmember Davis asked, What responsibility have we put on the companies themselves to keep up with the record keeping when it comes to this kind of situation? There is a benefit to getting an abatement,but it is a caviar kind of thing. Therefore, since you get those kinds of things, there is a responsibility they have. We can always put a lot of pressure on the Assessor and put the blame there, but I also believe there is a role for us and a role for those that are getting the abatements. Mr. Mueller stated, The first (1St) concern is are they making the investment in our community, and are they creating the jobs that they promised. Second (2nd), we help remind them that they have paperwork to fill out every year, so we send out reminders. For the most part, the tax recipients remember to fill those out. Whatever is in their memorandum of agreement is required of them. Council President Scott opened the floor to Council for questions. There were none. Council President Scott opened the floor to the public for those wishing to speak in favor of Bill Nos. 18-42, 18-43, 18-44, 18-45, 18-46, 18-47, 18-48, 18-49, 18-50, 18-51, 18-52. There were none. President Scott opened the floor to the public for those wishing to speak against Bill Nos. 18-42, 18-43, 18-44, 18-45, 18-46, 18-47, 18-48, 18-49, 18-50, 18-51, 18-52. Sue Kesim, 4022 Kennedy Drive, stated, I think there is a need for change in policy on the abatements, especially since in reviewing it, the Council and the City gave out $36 million in abatements in 2017, $25 million in abatements in 2016, and from 2011-2017, $117 million in abatements. I think it is excessive, and there needs to be tighter parameters. Especially when I saw that many of them created no jobs, or less than 10 jobs. I think as Councilmember Davis said, it's a caviar thing. I noticed in the packet there is no ROI and no dollar amount. I thought that would have been helpful to the citizens. It is best practice to give TIF or abatement,but not both. I would hope that you would do that. There are negative numbers on the time left on some of the reports. I don't know if they're getting the abatement beyond what was voted on by Council. There are also figures missing in the 2017 report, so it would be great to have complete data to work with. Jason Banicki Critchlow, 3822 W. Ford St., stated, particularly when it comes to the JSK Development ones, it is one(1)thing for them to build a couple of hotels. When we gave them the parking lot for$1,they agreed to buy the Hall of Fame for$1.5 or$1.6 million if I recall correctly. But they didn't do their due diligence to see if they could use the Hall of Fame in the way that they intended. When that didn't work out, we still allowed them the tax abatement, but now we've backed the purchase price off over$1 million out of the tax payers' pocket. So now not only have we given them the property to build the hotel and the tax abatement for the property, now we negotiated $1 million off of the purchase price. When we keep having to change the parameters to match them, why should we continue to give them these excessive abatements? In terms of the Liberty Tower, it's great to say that he's going to invest all of that money. I know some of the insiders on that project, and he is not investing that money because it is going great. He is going to lose money on that project, which means he is less likely to do another project. It's great to say hey, its $53 million and it's all this extra money. It's not because the project is going well, it is because it is not going well. It is not going to be a profitable project, and it is not going to reflect well for future projects downtown. Yes, tax abatements are only on new dollars, but when you look at the Liberty Tower project, they made sure to empty the Chase Tower before seeking the abatement so when they're seeking it,taking a building that was once relatively full,then half full, then emptying it completely before seeking an abatement. You've pushed down that appraised value very far and now you're seeking an abatement on what you hope to be at least half full now, and eventually a relatively full building again. So you're only taking an abatement on these phased in things with that project, but you've depressed the value to start, so you're giving yourself an unfair starting advantage at the taxpayer's expense. Jesse Davis, P.O. Box 10205, South Bend, IN, stated, We've talked about these abatements many times. Prior to offering abatements, we had development. We are coming to a fiscal cliff that you keep talking about because of lack of tax dollars, yet you want to give the tax dollars away. Not only are we giving them abatements,but we are also giving them tax dollars for the projects. Some of these projects we've seen up thirty percent (30%) or larger of investment of tax dollars into the 9 REGULAR MEETING September 10, 2018 project. And you're saying the projects aren't going to happen if we don't give the abatements. Projects happened prior to abatements and TIF dollars. We need to be conscience about what we're doing with these abatements, and how steadily they've climbed. They can show all the graphs up here that they want, but we can show graphs of where all of the abatements have had a steady incline as well. Then you look at the AJ Wright building, we put a lot of money into that place. We gave tax abatements and they bailed. They didn't have to pay anything, and we sold the place for pennies on the dollar and never gained anything back. That's happening over and over again. If we continue to keep voting these through,then you want to sit up here and vote to reduce money for neighborhood projects,that's just wrong, that's not what we elected you folks to do. President Scott opened the floor for a rebuttal from Mr. Mueller. Mr.Mueller stated,Just to remind people that we are not talking about the loss of any tax revenues. The Hall of Fame, if this development was going to happen,we'd have something in there already. These developments are difficult, our market is still not quite there. One(1)of the folks mentioned that there may be issues with penciling out. This really shows the need for incentives in our market, where we're not going to see this level of investment. Incentives help fill that gap. We can do it with tax abatements, TIF, or a combination. We're trying to move more toward using tax abatements, because we'd like to use TIF for other things like parks, neighborhood plan implementation and public works capital. But again, Liberty Tower is a good base. We'd either be tearing it down, spending TIF dollars to demolish that building, or it would be falling apart in the middle of our downtown if it weren't for finding a developer who is willing to take the risk and put tens of millions of dollars into it, asking for tax phase in, because that's the more appropriate way to characterize this incentive. As the investment goes into it, the new tax, only on the new part, is phased in. We'll just let the results speak for themselves. I hope that we can continue this progress for the City. Councilmember Gavin Ferlic, stated, It is ok to talk about tax abatements as a whole, but I just want to remind Council and the public that we are just talking about extending the designation period. We're not talking about amending these at all, except for extending that period so it can keep up with the lag in assessments. Councilmember Gavin Ferlic made a motion to adopt Bill No. 18-42. Councilmember Jo M. Broden seconded the motion which carried by a roll call vote of seven (7) ayes (Councilmember Davis). 18-43 A RESOLUTION MODIFYING AND RECONFIRMING THE ADOPTION OF DECLARATORY RESOLUTION NO. 4467-15 DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS 122 CALLANDER ST. SOUTH BEND, IN 46614 AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF A (6) SIX YEAR REAL PROPERTY TAX ABATEMENT FOR JSK DEVELOPMENT, INC./IRELAND HOSPITALITY, LLC Councilmember Gavin Ferlic made a motion to adopt Bill No. 18-43. Councilmember Jake Teshka seconded the motion which carried by a roll call vote of seven(7) ayes (Councilmember Davis). 18-44 A RESOLUTION MODIFYING AND RECONFIRMING THE ADOPTION OF DECLARATORY RESOLUTION NO. 4467-15 DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS 121 SOUTH ST. JOSEPH ST., SOUTH BEND, IN 46601 AN 10 REGULAR MEETING September 10, 2018 ECONOMIC REVITALIZATION AREA FOR PURPOSES OF A (9)NINE YEAR REAL PROPERTY TAX ABATEMENT FOR JSK DEVELOPMENT, INC./SOUTHHOLD, LLC Councilmember Gavin Ferlic made a motion to adopt Bill No. 18-44. Councilmember Sharon McBride seconded the motion which carried by a roll call vote of seven(7) ayes (Councilmember Davis). 18-45 A RESOLUTION MODIFYING AND RECONFIRMING THE ADOPTION OF DECLARATORY RESOLUTION 4456-15 DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS 111 SOUTH ST. JOSEPH ST., SOUTH BEND, IN 46601 AS AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF A TWO (2) YEAR VACANT BUILDING TAX ABATEMENT FOR JSK DEVELOPMENT, INC./SOUTHHOLD, LLC Councilmember Gavin Ferlic made a motion to adopt Bill No. 18-45. Councilmember Karen White seconded the motion which carried by a roll call vote of seven(7) ayes (Councilmember Davis). 18-46 A RESOLUTION MODIFYING AND RECONFIRMING THE ADOPTION OF DECLARATORY RESOLUTION NO. 4512-15 DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS 635 S. LAFAYETTE BLVD., SOUTH BEND, IN 46601 AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF A (10) TEN YEAR REAL PROPERTY TAX ABATEMENT FOR RDISTRICT ONE, LLC Councilmember Gavin Ferlic made a motion to adopt Bill No. 18-46. Councilmember Sharon McBride seconded the motion which carried by a roll call vote of seven(7) ayes (Councilmember Davis). 18-47 A RESOLUTION MODIFYING AND RECONFIRMING THE ADOPTION OF DECLARATORY RESOLUTION NO. 4596-16 DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS 3722 FOUNDATION CT, SOUTH BEND, IN 46628 AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF A FIVE (5) YEAR PERSONAL PROPERTY TAX ABATEMENT FOR IMAGINEERING ENTERPRISES, INC. Councilmember Gavin Ferlic made a motion to adopt Bill No. 18-47. Councilmember Karen White seconded the motion which carried by a roll call vote of six (6) ayes (Councilmembers Davis and Broden). REGULAR MEETING September 10, 2018 18-48 A RESOLUTION MODIFYING AND RECONFIRMING THE ADOPTION OF DECLARATORY RESOLUTION NO. 4594-16 DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS 3722 FOUNDATION CT, SOUTH BEND, IN 46628 AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF A (6) SIX YEAR REAL PROPERTY TAX ABATEMENT FOR IMAGINEERING ENTERPRISES, INC. Councilmember Gavin Ferlic made a motion to adopt Bill No. 18-48. Councilmember Karen White seconded the motion which carried by a roll call vote of six(6) ayes (Councilmembers Davis and Broden). 18-49 A RESOLUTION MODIFYING AND RECONFIRMING THE ADOPTION OF DECLARATORY RESOLUTION NO. 4501-15 DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS 211 WEST WASHINGTON STREET AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF A (10) TEN YEAR REAL PROPERTY TAX ABATEMENT FOR HOTEL LOCATED AT THE TOWER AT WASHINGTON SQUARE LLC Councilmember Gavin Ferlic made a motion to adopt Bill No. 18-49. Councilmember Jo M. Broden seconded the motion which carried by a roll call vote of seven (7) ayes (Councilmember Davis). 18-50 A RESOLUTION MODIFYING AND RECONFIRMING THE ADOPTION OF DECLARATORY RESOLUTION NO. 4503-15 DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS 211 WEST WASHINGTON STREET AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF A (10) TEN YEAR REAL PROPERTY TAX ABATEMENT FOR PARKING GARAGE LOCATED AT THE TOWER AT WASHINGTON SQUARE LLC Councilmember Gavin Ferlic made a motion to adopt Bill No. 18-50. Councilmember Jo M. Broden seconded the motion which carried by a roll call vote of seven (7) ayes (Councilmember Davis). 18-51 A RESOLUTION MODIFYING AND RECONFIRMING THE ADOPTION OF DECLARATORY RESOLUTION NO. 4502-15 12 REGULAR MEETING September 10, 2018 DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS 211 WEST WASHINGTON STREET AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF A (10) TEN YEAR REAL PROPERTY TAX ABATEMENT FOR RETAIL PROPERTY LOCATED AT THE TOWER AT WASHINGTON SQUARE LLC Councilmember Gavin Ferlic made a motion to adopt Bill No. 18-51. Councilmember Jo M. Broden seconded the motion which carried by a roll call vote of seven (7) ayes (Councilmember Davis). 18-52 A RESOLUTION MODIFYING AND RECONFIRMING THE ADOPTION OF DECLARATORY RESOLUTION NO. 4506-15 DESIGNATING CERTAIN AREAS WITHIN THE CITY OF SOUTH BEND, INDIANA, COMMONLY KNOWN AS 211 WEST WASHINGTON STREET AN ECONOMIC REVITALIZATION AREA FOR PURPOSES OF A(10) TEN YEAR REAL PROPERTY TAX ABATEMENT FOR APARTMENTS LOCATED AT THE TOWER AT WASHINGTON SQUARE LLC Councilmember Gavin Ferlic made a motion to adopt Bill No. 18-52. Councilmember Jake Teshka seconded the motion which carried by a roll call vote of seven(7) ayes (Councilmember Davis). BILLS ON FIRST READING BILL NO. 42-18 FIRST READING ON AN ORDINANCE OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, APPROPRIATING ADDITIONAL FUNDS FOR CERTAIN DEPARTMENTAL AND CITY SERVICES OPERATIONS IN 2018 OF $672,857 FROM ECONOMIC DEVELOPMENT STATE GRANT (#210), $1,000,000 FROM DCI GRANT FUND (#212), $5,000 FROM GIFT/DONATIONBEQUEST FUND (#217), $699,700 FROM LIABILITY INSURANCE PREMIUM RESERVE (#226), ($960,000) FROM LOIT 2016 SPECIAL DISTRIBUTION (#257), ($337,632) FROM LOCAL ROAD & BRIDGE GRANT (#265), $28,100 FROM ECONOMIC REVENUE BOND (#281), ($55,000) FROM COVELESKI STADIUM CAPITAL (#401), ($124,050) FROM UDAG(#410), $28,100 FROM REDEVELOPMENT GENERAL (#433), AND $650 FROM SMART STREETS DEBT SERVICE (#756). 13 REGULAR MEETING September 10, 2018 Councilmember Karen White made a motion to send Bill No. 42-18 to the Personnel and Finance Committee for their September 24th,2018 meeting for Second Reading and Public Hearing and for Third (3rd) Reading on September 24th, 2018. Councilmember Gavin Ferlic seconded the motion which carried by a voice vote of eight (8) ayes. 43-18 FIRST READING ON AN ORDINANCE OF THE COMMON COUNCIL OF THE CITY OF SOUTH BEND, INDIANA, FOR BUDGET TRANSFERS FOR VARIOUS DEPARTMENTS WITHIN THE CITY OF SOUTH BEND, INDIANA FOR THE YEAR 2018 Councilmember Karen White made a motion to send Bill No. 43-18 to the Personnel and Finance Committee for their September 24th,2018 meeting for Second Reading and Public Hearing and for Third (3rd) Reading on September 24th, 2018. Councilmember Gavin Ferlic seconded the motion which carried by a voice vote of eight (8) ayes. 44-18 FIRST READING ON AN ORDINANCE AUTHORIZING THE ISSUANCE AND SALE OF AN AGGREGATE PRINCIPAL AMOUNT OF NOT TO EXCEED $4,205,000 OF CITY OF SOUTH BEND, INDIANA, ECONOMIC DEVELOPMENT REVENUE BONDS, SERIES 2018 (POTAWATOMI ZOO PROJECT)AND AUTHORIZING AND APPROVING OTHER ACTIONS IN RESPECT THERETO Councilmember Karen White made a motion to send Bill No. 44-18 to the Personnel and Finance Committee for their September 24th,2018 meeting for Second Reading and Public Hearing and for Third (3rd) Reading on September 24th, 2018. Councilmember Gavin Ferlic seconded the motion which carried by a voice vote of eight (8) ayes. UNFINISHED BUSINESS Councilmember Davis stated, I would like to thank you, Mr. President, for getting back to me regarding the possible upcoming letter in terms of merging people on the County Commissioners, the City Council, and the airport, so we can all talk about the upcoming possible changes in the South Shore. I appreciate you doing that and look forward to you following up on that. Council President Scott stated, I will give you an update hopefully later this week. NEW BUSINESS Councilmember Davis stated, Shout out to the Chief of Staff again, I had a trash situation in my district, and she jumped on that quick after I sent her an email. People were very grateful for you. PRIVILEGE OF THE FLOOR Samuel Brown, 222 E. Navarre, stated, The crash on Western Avenue, of the police officer. I'm thinking about the family, I'm thinking about the City as a whole. I want this seriously, all the stakeholders involved in this, we've got to get this right. The family is going to mourn for a long time. There's nothing you can do about it, it's human nature. To make sure something like this never happens again, with all of the components of this accident, there's something we can do, 14 REGULAR MEETING September 10, 2018 where we can protect the citizens, protect the police officers when they're out on calls to protect us, but we've got to get it right. We've got to have faith that our leaders are making sound decisions. The family is going to grieve for a long time, but it will help the process if you get this right.There should be nothing to hide.Please,please,when that decision comes down,don't divide our City. Please don't tear our city up. I'm begging you. Jesse Davis, PO Box 10205, South Bend, IN, stated, I was wondering if you guys could get some input on traffic statistics, crashes, things of that nature on these streets that we've made all these changes to. I get beat up on the internet because of comments that are made. We have an eleven (11) year old boy who died on South Michigan Street. Our mayor came out and said they should have been on a cross walk and if wasn't foggy, he wouldn't have been hit. That happened within days of them changing the street from one (1)-way traffic. These kids were used to looking one(1) direction before they ran across the street. They also had a crosswalk and a traffic light there prior to that accident that was removed by our City officials. It was then replaced right away. Then we have police officers traveling ninety (90)to ninety-five (95) miles per hour down a road that used to be two (2) lanes, and now it's shrunk down to a single lane in each direction and there are bump outs and so forth. There's literally less room for that officer or for an individual to maneuver and try to avoid an accident. Anyone who wants to say Smart Streets has not contributed to any of these things is dead wrong. We've got a young lady who lost her life, her young children are now with her sister. We have a Prosecutor who sent it to a grand jury, it came back, and people aren't happy with that result and now they're sending it to the Board of Public Safety. We've asked you guys for our own board for years. We have zero (0) faith in that Public Board of Safety that's appointed by our Mayor. We see what they've done in other cases where people were beat up by cops. We don't have faith that they're going to make any better decision than that grand jury made. Again,we want a board for the people that is compiled of people,not somebody who is handpicked by the Mayor, who can oversee these things and see that this is a fair process. I hope they get this one (1) right. If they don't, this community could be a mess. Jason Banicki Critchlow, 3822 W. Ford Street, stated, On July 20'', this community suffered an unmentionable tragedy involving a crash between Erica Flores and South Bend Police Officer Gorny, which resulted in the death of Erica Flores. I don't need to rehash any of the facts of this tragedy, but I will ask for justice for the family, and equal treatment under the law for our law enforcement officers, the same as any other citizen would receive. While Indiana law allows for the use of grand juries, it is indeed a very rare step to be used, especially when it is very clear that South Bend Police Department policies and Indiana State Law was broken in this instance. I am calling on the South Bend Common Council to draft and pass a resolution calling on our Prosecuting Attorney Ken Cotter to step aside and turn this case and investigation over to a Special Prosecutor in regards to this fatal crash.As any investigation into a police officer calls for complete and total transparency, however, the Prosecutor chose to use a grand jury, where every piece of evidence and testimony is sealed and kept from every citizen, and absolutely bypasses the transparency that is required in a case like this. This move by our Prosecutor instead calls into question his objectivity in this case and makes it impossible for the Flores family to perceive that they've received the justice that they deserve. As someone who worked at the jail for many years, I used to tell new people that just the appearance of impropriety is impropriety in itself.The minute that this appears impartial, that our Prosecutor is favoring our police officers over our citizens, it is time for him to step aside and let a Special Prosecutor handle that. I am calling on your guys to use the political courage necessary to go after a Democrat in a Democratic city to say look, you are doing a big thing badly. Step aside, let a Special Prosecutor handle it. That way there is no saying hey,you were covering for your cops or somebody you knew,because a Special Prosecutor won't have those ties. It's funny that we want to send a resolution to Washington, DC to Donald Trump and Mike Pence. Let's send a message to our City that as a Council, we stand behind all of our citizens and believe in equal justice for everybody. Pass a resolution calling for Ken Cotter to step aside in this case. Sue Kesim,4022 Kennedy Drive,stated,I am given time to speak,but I don't get to say something good, because I have to address the issues. It seems negative, but I have time constraints. I want to give a special shout out to the Finance Department. They did a beautiful job on the CAFR and 15