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HomeMy WebLinkAboutRM 02-25-83February 25 10:00 a.m. Presiding O SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING 1983 1200 County -City Building 227 W. Jefferson Boulevard ficer: Mr. F. Jay Nimtz South Bend, Indiana 46601 President 1. Roll Call Members Present: Mr. F. Jay Nimtz, President Mr. Lloyd E. Robinson_, Sr., Vice President Mr. A. Peter Donaldson, Secretary Ms. Paula N. Auburn, Assistant Secretary Mr. Roman J. Piasecki, Member Legal Counsel: Ms. Eugenia Schwartz Redevelopment Staff: Mr. Jon R. Hunt, Executive Director Mrs. Ann Kolata, Executive Deputy Director Mr. Kevin Horton, Deputy Director Mr. Donald Inks, Deputy Director Ms. Denise Sullivan, Executive Secretary Bureau of Housing Staff: Ms. Janet Holston, Director Ms. Mary Richmond, Project Director News Media: Ms. Rebecca Marr, WSBT -TV Mr. Jack Kuenzie, WSJV -TV Mr. John Winey, WSJV -TV Ms. Jeanne Derbeck, South Bend Tribune Guests: Mr. Kenneth Kunst Mr. Howard Bessire Ms. Glenda Rae Hernandez 2. APPROV OF MINUTES Upon a notion made by Mr. Robinson, seconded by Mr. Pia ecki and unanimously carried, the minutes of the Regular Meeting of Friday, February 11, 1983 were approved. 3. APPROVA31 OF CLAIMS Upon a notion made by Mr. Donaldson, seconded by Ms. luburn and unanimously carried, the claims previously signed were formally approved and the checks ated February 16th and 23rd, 1983 were ordered to be released. MONROE-SAMPLE AREA PROJECT Community Development $ 112.79 Kevin J. Butler 287.70 Inter-City Enterprises 2,500.00 MINUTES OF THE REGULAR MEETING OF FEBRUARY 11, 1983 WERE APPROVED CLAIMS PREVIOUSLY SIGNED AND DATED FEBRUARY 16 and 23, 1983 WERE FORMALLY APPROVED AND ORDERED.TO BE RELEASED South Bend Regular Mei 3. Telopment Commission February 25, 1983 OF CLAIMS (Continued) MPLE AREA PROJECT (Cont.) Co. of St. Joe County Heritage Foundation TOTAL . ..w w 4M Community Development Kevin J Butler South Bend Water Works Standard Mechanical & Burkhart Advertising Kawneer Company, Inc. I� .. $ 123.00 2,202.89 $5,226.38 $ 33.33 680.78 14.68 74.60 - 289;889:28 TOTAL $290,692.67 Ronald E. Gettel $1,300.00 Kevin J. Butler 403.30 John G. Rence Assoc. 800.00 Con mi y Development 11,094.50 First Auto Lease 205.15 Civic Action Institute 20.00 Berreth Oil, Inc. 74.05 Business Systems 93.44 America Institute Education Dept. 300.00 Abstract Co. of St. Joe County 214.00 Makiels i Art Shop 21.88 Kevin J. Butler 200.00 Federal Express Corp. 31.83 Business Communication Center 56.00 Payroll: 2 -5 thru 2 -18 -83 10,873.51 4. COMMUNI There w 5. OLD BUS There w TOTAL $25,687.66 GRAND TOTAL $321,606.71 no communications. no old business. &A THERE WERE NO COMMUNICATIONS THERE VMS NO OLD BUSINESS South Bend Regular Mee 6. NEW BUS a. Com aba elopment Commission - February 25, 1983 for a tax est relative to an area com- money referred to as 3511 Gagnon ( Kawneer Mr. Hunt explained that Commission approval is requested for a tax abatement request relative to an area corrunonly referred to as 3511 Gagnon Avenue in Phase IV of the Airport Ind strial Park for Kawneer Company which is the parent company for South Bend Screw Pro- ducts. As you know we are in the process of closing on the property South Bend Screw Pro- ducts has in the East Bank area. Approval of thi tax abatement will allow them to stay in Sou Bend and to expand their operation. Mr. Lee explained that the total project cost is estintated at $500,000 for land and building. There is a potential of 25 jobs retained and a possibility of 22 new jobs with further ex- pansion. Mr. Kunst, manager of South Bend Scr w Products, was present to answer further Ms.- Derbeck asked if South Bend Screw Pro - duc s was also getting relocation money. Mrs Kolata stated that the relocation money is independent of tax abatement and will be used to pay the actual costs of relocating. Mr. Bessire stated that as a representative of the Industrial Foundation, he supported the tax abatement request. He also explained that the Industrial Foundation had been work- ing with Kawneer and South Bend Screw Products for several months to insure that they stayed in 8outh Bend. Upor a motion made by Mr. Robinson, seconded by Mr. Piasecki and unanimously carried, the staff report recommending tax abatement for Kawreer Company at 3511 Gagnon was approved. b. gam#ssion approval requested for the follow- ing loans in connection with the Rehabilitation -3- TAX ABATEMENT FOR KAWNEER COMPANY AT 3511 GAGNON VAS APPROVED South Bend Redevelopment Cm nission Regular Meeting - February 25, 1983 6. NEW BUSINESS (Continued) b. Continued... Name Address Loan Amount Nannie Smith 1137 W. Jefferson $11,800 Priscil a Dill 714 W. Washington $19,400 Mr. Hunt explained that there are two rehabili- tation loans up before the Commission today. The first one is for Smith, it's a 10 year loan at o interest with a .payment of $98.33 a month. The loan total will be for $11,800 and it's for a p operty located at 1137 W. Jefferson. The aft r rehab value of the property will be $16,000. The second loan is for Priscilla Dill. It's a 0% interest loan and is a deferred balance loan for a property at 714 W. Washington. The loan amount would be in the amount of $19,400 with a $10.00 a month payment. When the house changes owner- shio we will receive payment in full. The after re value of the property is $32,000. Mr. Piasecki questioned the income on Nannie Smith, a portion of which is a Housing Allow- ance payment. He asked how this will affect the payment plan. He also asked what type of apartment she has. Mrs�Kolata stated that she has a roomer.and didn't thi it was a separate apartment. Mr. Piasecki also asked why there weren't smoke ala in the specifications. Mr. Hunt explained that the specs were written before the Commission took final action and would recoamend that we put thEm in. Mr. Nimtz asked if there was any objection to the C ssion requesting the smoke alarms be included. Hearing none, the Bureau of Housing was asked to include smoke alarms. Mr. Piasecki questioned the wide range of bids on the Dill property. Mrs Kolata stated that the advisory board also que tioned the wide range on the bids on this -4- South Bend edevelopment Commission Regular Meeting - February 25, 1983 6. NEW BUSjNESS (Continued) b. Continued... particular property. I think the staff said that the bid on the roof repair ranged from just over $3,000 to over $8,000 for the one itaii alone. I am sure it had to do with the method of treatment, the high bidder probably int ded to keep the built -in wooden gutter and they would do a fancier job on the roof. That 's not to say a low bidder isn't going to provide an acceptable roof.as it still has the same specifications. Upon a motion made by Mr. Robinson, seconded by Ms. Auburn and unanimously carried, a loan in the amoimt of $11,800 to Nannie Smith for 1137 W. Jefferson was approved. Upon a motion made by Mr. Donaldson, seconded by As. Auburn and unanimously carried, a loan in the amount of $19,400 to Priscilla Dill for 714 W. Washington was approved. c. C ssion approval requested for awarding the following bids in connection with the Rehabili- tation Loan Program in accordance with the re- ccimendation from the Bureau of Housin . Name Contractor Amount Nannie 'th Reese & Sons $10,841.50 1137 W. Jefferson Priscilla Dill Aardvark Const. Co. $18,670.00 714 W. Washincrton Mr. Hunt stated that we have two contracts for consideration. The first contract is for Nannie Smith. There is a reccmendation to award the contract to Reese and Sons at $10,841.50. The Reese and Sons bid was the lowest bid of eight. On the Dill contract the Bureau of Housing re- camendation is that Aardvark Construction re- cei e the contract as they were the lowest bid of six. Their bid was for $18,670 and the Bureau of Housing estimate was $17,511. Mr. Smi Robinson asked about the bids for the Nannie h contract. He stated that he knows we have wage scales established, and he took the -5- REHABILITATION LOAN FOR NANNIE SMITH, 1137 W. JEFFERSON, FOR $11,800 WAS APPROVED REHABILITATION LOAN FOR PRISCILLA DILL, 714 W. WASHINGTON, FOR $19,400 WAS APPROVED South Bend edevelopment Commission Regular Meeting - February 25, 1983 6. NEW BUS$NESS (Continued) c. c:ontinuea... liberty of asking Janet Holston who the electrical contractor was that Reese and Sons was using. He realized that it's not anybody's fault, but there is a loophole in the federal statute whereby the indivi- dual sole proprietor can charge anything he wants. In this case the electrical contrac- tor that they are using is more or less a one man operation and there is no way a legi- tiimite electrical contractor, who has employees and they go out and do the work, can compete with this type of an individual. He can put anything on paper, he can meet any require- ment necessary about area wage scales. He just turns right around and takes money off the top and puts money back into the business and he has a big paper shuffle, and Mr. Robinson sta ed that he was strictly against it. Mr. Hunt explained that Mr. Robinson is cor- rect. in what he is saying, there is a loop- hole. A sub- contractor, as an individual not employing anybody, can in fact do that. If 1he individual would employ somebody we would require them to pay prevailing wages for the person they employ but there really isn't anything we can do in the sense of a one person operation. I think that the only thirig that we can do is have Bureau of Housing ins ors make sure the work is done properly. Ms. Holston stated that on this particular con act the difference in the bid did have quite a wide range. The difference was again the roof, the siding and those types of things. We saw a lot of difference. Reese was the low Ms.lAuburn asked if we have had experience with Ree e and Sons_and what kinds of experience. Ms. Richmond stated that this would be Reese and Sons' third contract. Ms.lAuburn asked what kind of work they have don on the other two contracts. :t:- South Bend Pedevelopment Commission Regular Mee ing - February 25, 1983 6. NEW BUSINESS (Continued) c. c;onitinuea... Ms. Richmond stated that they did an $11,000 grant which was completed and they are also at abo t 80% completion of the loan contract that was previously approved. We have had no follow - up problems on the grant contract; we do go back to monitoring them so that they are completed. There was no call back on that; she didn't think tha they have reached the expiration date. Ms. Auburn explained that she had somewhat the same concern that Mr. Piasecki has that if we are going to do it that it be done well and be- cause of the spread on this one, the cheapest is not always best. Mr. Piasecki asked about workman's comp and in- sur ce that these people take out. Is this fil with you once, or are they showing you pr f of this on that new job. That's important. Ms. Holston stated that a copy of the insurance is with the application and both are updated annually. Mr. Robinson stated that again it's an erosion of the statute, simply because he is the sole proprietor he doesn't plan workman's comp on h' elf, so it's an erosion and a lot of big fat loopholes and it makes him irritated. He would question the quality of work when you get it as a one man job and how to complete thi gs on time. He assumes that there has ,got to be some corners cut because he knows that there are special things out there that you have to have help on, and he thinks these people have got it bad enough in life without having a law eroded like it's being done. He stated that he certainly won't vote in favor of it. Mr. Nimtz asked if there were any other ques- tions. He stated he will act on these indi- vidually. He asked what the pleasure of the CcnmLission was on Nannie Smith concerning this Mr. Zbinson made a motion for rejection. Mr. Pia ecki seconded the motion. aC MOTION WAS MADE TO REJECT THE BID FOR NANNIE SMITH, 1137 W. JEFFERSON, BY REESE AND SONS FOR $10,841.50 South Bend F Regular Meet 6. NEW BUS] c. Cont Mr. the elopment Ccomission - February 25, 1983 (Continued) Donaldson asked if we would be rejecting contractor? Mr. Nimtz explained that we would be reject- ing the awarding of the bid to Reese and Sons. Ms. Auburn asked what is the effect of doing that. Mrs. Kolata explained that the Conission awa ded the loan so the loan amount will have to adjusted. Ms. Schwartz stated that the contract with the next contractor would have to come before the next Commission meeting and of course that wou d delay the timetable for any kind of work that might be done on the house. Also the amo t of the loan would have to be adjusted at he next meeting. Mr. Donaldson stated that was his question. Do e give the loan along with the contract or 'ust reject the bid of the contract. Ms. Schwartz said we would have to cane back for an adjustment of the loan. Ms. Auburn stated that the question is what legal bas's do we have for rejecting the bid. Ms. Schwartz stated it would be the determina- tio on your part that this was not the lowest and best bid and from what she had heard it woul be under the best category. Mr. imtz asked Ms. Holston if she agreed with the rationale that we would have to cane back with the next contract to the next meeting. Ms. Holston said yes and then we would have to adj t the loan. Mr. imtz stated that the motion is that the awa ding of the contract to Reese and Sons conc ruing Nannie Smith be rejected. Is there any further question or discussion. The motion was approved unanimously and the contract was rele ted. COMMISSION REJECTED THE BID OF REESE & SONS FOR 1137 W. JEFFERSON South Bend edevelopment Ccmnission Regular Meeting - February 25, 1983 6. NEW BUSINESS (Continued) c. Continued... Mr. Hunt asked what would happen if Mr. Reese comes back in with a new electrical contractor and is still under the next lowest bid which is about $12,400 compared to his $10,000. Mr. Robinson stated that he was not really sure it's just the electrical contractor we are com- pla ning about. He stated that he personally felt: that there might be an erosion in the quality of work that he thinks these people are entitled to. He stated that they have enough problems in life. He stated that it wasn't singled out to be the electrical contractor it just happens to be the pursuit that he followed. Mr. Piasecki stated that was the reason why he vot d on that. Ms. Schwartz stated that bids have already been rec ived and the time for receiving bids is closed so it is her interpretation that we would have to decide based on the bids that we already havr= in hand rather than adjust any bids, due to sub ontractors bids which haven't been received. Mr. Piasecki said that he can't see where they can Po the same work for $10,000 and the next one for $27,000. Mr. Inks asked whether the Commission action was taken even though there were more factors to con- sider than just the electrical workers,and whether we have just rewritten the federal law for our own program and state that sole proprietorships fall under the same wage determination as do all othe businesses. Mr. obinson said we know that they do; we have not hanged the federal law whatsoever. Mr. Inks commented that Mr. Robinson is saying that there is a federal loophole; that he is sayiiig that your local process has just changed the Law to close that. Mr. Robinson said no, he did not. He said that he thinks that the quality of work has been eroded but he said that it is a loophole in the law md that was just one of his reasons why he was upset with what is happening with these type of people. South Bend edevelopment Commission Regular Meeting - February 25, 1983 6. NEW BUS MSS (Continued) c. Continued... Mr. Inks asked if Mr. Robinson was not upset with the fact that this contractor, being a sole proprietorship, under -bid the other be- cause he was not paying himself the same wages. Mr. Robinson stated he was upset about it but there is nothing he can do about that; that it is it federal law and he knows the law very well, probably better then Mr. Inks. Mr. Hunt stated that Mr. Ink's point is well tak in the sense of setting a precedent with this action today. He thinks that we can't reject every bid that's the lowest and best bid because it has a sole proprietorship. Ms. Auburn stated that she didn't think that that was the reason of the action. She really had a question on the bid spread. Mr. Nimtz explained that Ms. Schwartz pointed that out, that it is a question of what is the best bid. Mr. Piasecki stated that's the reason why he asked to see the highest and lowest bids, to see what actually the difference is. Apparently the *e must be some great difference. Mr. Robinson explained that we have changed policy on this Commission many times. It used to be that we didn't go along with the lowest bid we went along with what the Bureau of Housing selected, the one that was closest to their estimates, anything below it we used to refuse. But then we decided if the guy is willing to take the chance and lose money we wou d accept the low bid and so we changed the policy -then. Mr. of Hunt asked for a clarification for the Bureau ousing, because we will receive many bids on sole proprietorship and instead of re ing them immediately what the Commission is ng is they are making decisions based upon r concern about the bid spread l and secondly t the quality of work that will be done. -10- South Bend edevelopment Commission Regular Meeting - February 25, 1983 6. NEW BUS$NESS (Continued) c. Continued... Ms.�Derbeck asked if the sole proprietor that we re talking about is Reese and Sons contractor. Mr. Ms. Mr. Ms. Hunt stated it was the subcontractor. Derbeck asked who the subcontractor is. Robinson stated that's not in here. Derbeck asked how Mr. Robinson knew this. Mr.�Robinson explained he asked as a ConmLission- er nd was informed of this .information: Ms. Derbeck asked if they were rejecting it because they feel that the quality of work will be roded. The reason for that being that the CormLission has seen poor work done by this con- tractor or because they don't think the bid is hig4 enough. Mr. Robinson said he questioned the quality of worR that will be performed, yes. Ms. Derbeck stated because it isn't high enough. Mr. obinson stated that'. what makes the world go around is money. Ms. Derbeck said that she agreed with Mr. Robin- son that there is such a thing as giving your approval to be able to do the job properly. Mr. Robinson said he questioned the quality that might be performed on this job. Mr. Piasecki stated that a thousand times in the past we have had people cane back. He is not saying that they will cane back in this case, and ask Eor more money and he doesn't think that's Mr. Nimtz asked if there were any other questions, if not they will move on. The next item was the awarding of the contract concerning the Priscilla Dill contract. Upon a motion made by Mr. Robinson, seconded by Ms. Auburn and unanimously carried, the contract was awarded to Aardvark Construction for 714 West Washington in the amount of $18,670. -11- MOTION WAS MADE TO AWARD THE BID FOR PRISCILLA DILL, 714 W. WASHINGTON, TO AARD- VARK CONST. CO. FOR $18,670 South Bend edevelopment Commission Regular Mee ing - February 25, 1983 6. NEW BUS�NESS (Continued) d. Ccmiission approval requested for a Main - ten nce Agreement with Southold Heritage Foundation, Inc., and Priscilla Dill. Mr. Hunt explained that this is a unique agree- ment, and is a positive sign of a neighborhood group wanting to keep a person in the neighbor- hood who has been a good, long time resident and recognizing the realities of a large home with a major amount of rehabilitation to be done on it. Recognizing that the City would require additional security and assurance that the home would be maintained, Southold Heritage has came forward, along with an in- dividual person who will co -sign for the loan, and a neighborhood group who has done some work for her, to insure that the house, once it's repaired, would be maintained in a proper Mr. Nimtz being a member of the Board of South- old Heritage, disqualified himself and placed ConTiissioner Robinson as Vice- Chairman in the Mrs Kolata explained that this agreement calls for yearly inspections and these inspections would take place as long as the loan is out and we Are receiving payments. It's a deferred pay- ment loan and, as long as the woman is living in the house and owns the property, 'these yearly inspections will take place. Once the loan is paid off, this agreement would be ended and we would no longer require inspections. This agr ement is necessary because of Mrs. Dill's limited resources and her inability to pay for home maintenance. Southold felt strongly that. this was a woman that they wanted to keep in he neighborhood. Mrs. Kolata stated that she thinks we would expect similar types of agr ements with other groups if there was a Der on in a similar situation. Mr. Piasecki asked if Southold had any plans to acquire this property. Mrs Kolata explained that Southold does not have any plans to acquire the house. They felt very strongly that this was a woman that they wanted to keep in the neighborhood and that they, as an organization, would be willing to take some special steps including'finding a co= signer -12- South Bend edevelopment Commission Regular Mee ing - February 25, 1983 6. NEW BUS$NESS (Continued) d. Continued... for the loan, agreeing to inspect the home yearly, and, if there are repairs that are needed, Southold will be responsible for seeing that they are done and obtaining fin- ancing for those repairs whatever they happen to be. Ms. Schwartz said that she wanted to repeat what. Ms. Holston said when she was presenting the loan originally, that although the major portion of the loan is a payment that is de- ferred for some time, we are requiring a ncm7- inal. monthly payment from the homeowner as part of the loan agreement. So it's that, and it's also the provision in the mainten- ance agreement, that if all else fails, South- old will help relocate Mrs. Dill if and when she want to or needs to relocate. At that tim , of course, the loan will become fully due and the City will get paid back at that Doi t. Mr.lDonaldson asked who approached her at Southold. Mrs Kolata stated that she approached the Bur au of Housing under the old grant program but the repairs were more than the grant pro- gram could allow and then we phased out the grant program. When it came to looking at a loan she didn't qualify under the guidelines as they were written. At that point Southold app oached us and we started looking at ways we nticrht be able to assist her. Upon a motion made by Ms. Auburn, seconded by Mr. Piasecki and unanimously carried, the main- tenance agreement with Southold Heritage Foun- dation, Inc., and Priscilla Dill was approved. Mr. Nimtz did not vote on this matter. Mr . I Nimtz resumed the chair. e. Discussion of acquisition of Parcels 1 -1 and of 1 -10 in the East Bank Development Area. Mrs Kolata explained that the first parcel is the north part of the East Race itself and the other one is a portion of a parcel adjacent to the Race. We have gone to condemnation and have a deed to the property, but as it has gone through the court process the previous owners -13- MOTION WAS MADE TO APPROVE THE MAINTENANCE AGREEMENT WITH SOUTHOLD HERITAGE FOUNDATION, INC., AND PRISCILLA DILL, 714 W. WASHINGTON South Bend 4edevelopment Commission Regular Meeting - February 25, 1983 6. NEW BUSINESS (Continued) e. uonuinuea... f. of e property have indicated to us that they would be willing to accept our original off r. Upon a motion made by Mr. Robinson, seconded by Mr. Donaldson and unanimously carried, the C ssion agreed to settle the purchase of Parcel 1 -1 and part of 1 -10 in the East Bank Development Area for the original offer of $69;475.00 for an Amendment to 4esolution No. 662 authorizing the transfer of #itle to certain land in the East Bank Devel- Area to Mr. Hunt explained that the amendment changes the amount of money,we will receive from the Park Department, changing it from $546,938.20 to 486,025.68. In reviewing the resolution and reviewing the documents and the land that was going to be purchased there were errors in the original documents. There will be ap- proximately an additional $51,000.00 that we would be receiving from the Park Department within the next several months for other par- cels over there as we clean up the smaller par els on the East Raceway and transfer those titles to the Park Department. Mr. Nimtz stated that the proper motion is that Resolution No. 662 passed by the Commission on May 28, 1982 be modified and amended to sub- stitute $486,025.68 for $546,938.20 in para- graph 3 and paragraph 4 $486,025.68 for $546,938.20. upon a motion made by Mr. Donaldson, seconded by Mr. Robinson and unanimously carried, amend- ment. to Resolution No. 662 was approved. There w (4re no progress reports. 8. NEXT COMMISSION MEETING The next regularly scheduled Conudssion meeting will be heldlon Friday, March 11, 1983. -14- MOTION WAS MADE TO SETTLE THE PURCHASE OF PARCEL 1 -1 AND PART OF 1 -10 IN THE EAST BANK DEVELOPMENT AREA FOR THE ORIGINAL OFFER OF $69,475.00 MOTION WAS MADE TO APPROVE AMENDMENT TO RESOLUTION NO. 662 THERE WERE NO PROGRESS REPORTS NEXT COMMISSION MEETING South Bend Redevelopment Ccmmmission Regular Meeting February 25, 1983 8. NEXT C SSION M M TING (Continued) Ms. Der beck asked if we are going to have the bid opehing on March 11, 1983. Mrs. Ko ata answered that we will have the public opening and we will have an attorney present to open the bids but it will not be at the Comm- nission meting, There will be no action taken other than opening the bid at 10:00 a.m. on March 7th. a There being no further business before the Ccmmiss'on, Mr. Robinson moved to adjourn. The motion was seconded by Mr. Piasecki and unanimously carried. The meeting was ad- journed at 10:48 a.m. -15- /6n R. Hunt, Executiv Director