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HomeMy WebLinkAboutRM 03-25-88SOUTH BEND REDEVELOPMENT COMMISSION REGULAR SCHEDULED MEETING March 25, 19 8 10:00 a.m. Presiding Officer: Ms. Paula N. Auburn Vice - President 1. ROLL CAI Members Members Legal Cc Redevelc Bureau c News Med Others: 1200 County -City Building 227 W. Jefferson Boulevard South Bend, Indiana 46601 t: Ms. Paula N. Auburn, Vice - President Mr. Roman J. Piasecki, Secretary Mr. Sandy Combs, Assistant Secretary Mr. F. Jay Nimtz, President Mr. Michael Donoho 1: Ms. Carolyn Pfotenhauer t Staff: Mrs. Ann Kolata, Acting Executive Director Mrs. Cheryl Phipps, Office Manager Ms. Gretchen Matthews Housing Staff: Ms. Kathryn Baumgartner, Director Ms. Jeanne Derbeck, South Bend Tribune Mr. Dick Maginot, WSBT -TV Mr. Carter Wolf, Center City Associates Ms. Eugenia Schwartz, Nickle & Piasecki Mr. Eugene Conard, Midway Mortgage Co. Ms. Auburn announced that the Executive Session which began at 9:00 a.m. would reconvene fo lowing adjournment of the Regular Meeting. 2. APPROVAL OF MINUTES a. Approval of Minutes of the Rec of March 11, 1988. COMMISSION APPROVED THE MINUTES OF THE REGULAR MEETING OF MARCH 11, 1988 Upon a motion made by Mr. Combs, seconded by Mr. Piasecki and unanimously carried, the minutes of the Regular Meeting of Friday, March 11, 1988 were approved. b. Appr val of Minutes of the Meet ng of March 14, 1988. COMMISSION APPROVED THE MINUTES OF THE SPECIAL MEETING OF MARCH 14, 1988 Upon a motion made by Mr. Combs, seconded by . Piasecki and unanimously carried, the ininutes of the Special Meeting of Monday, March 14, 1988 were approved. -1- South Bend Redevelopment Commission Regular Meet'ng - March 25, 1988 3. APPROVAL OF CLAIMS Upon a m tion made by Mr. Piasecki, seconded by Mr. C mbs and unanimously carried, the Commissi n formally approved the claims submittel March 14 and March 21, 1988, and ordered hecks dated March 18 and March 25, 1988 to be released. ADMIN 1988 Billies, Inc. MacMilla Book Clubs, Inc. South Be-id/Mishawaka Area Chamber of Commerce Urban Laid Institute Zuchelli Hunter & Associates, Inc. Corporat'on for Enterprise Development Gene's Gunera. Shop National Parking Associates TotaL Admin 1988 T.I.F. 11985 Indiana & Michigan Electric Co. R.E. McC oskey & Associates TotaL T.I.F. 1985 T.I.F. 11988 The Abstract & Title Corp. of South Bend TotaL T.I.F. 1988 G TOTAL 4. There were no communications. 5. OLD BUSINESS There was no old business. 6. NEW BUSINESS a. ConmLssion approval requested for loans in connection with the Section 312 Loan Program in accordance with the recodmendation from the Bureau of Housing. -2- COMMISSION FORMALLY APPROVED THE CLAIMS SUBMITTED MARCH 14 AND MARCH 21, 1988 AND ORDERED CHECKS DATED MARCH 18 AND MARCH 25, 1988 TO BE RELEASED $ 16.80 49.37 6.00 65.00 4,447.56 78.00 6.06 $ 4,723.79 $ 37.02 3,900.00 $ 3,937.02 $ 250.00 $ 250.00 $ 8,910.81 THERE WERE NO COMMUNICATIONS THERE WAS NO OLD BUSINESS South Bend edevelopment Commission Regular Meeting - March 25, 1988 6. NEW BUSINESS (Cont.) a. Continued... Flo d and Judith Taylor 113E W. Napier Francine Williams 540 N. Blaine Richard and Tamara Stillson 1613 W. Indiana Elizabeth Molnar 2020 Prairie Mrs. Kolata noted that Mr. Taylor is an empl yee of the City, but there is no conflict of i terest because he works for a department unre ated to the activities of this det�a tment . Ms. Baumgartner noted that the Taylor application is the first to go through the join West Washington area /Section 312 Program. In this program, if the contractor's estimate exceeds what the Bureau of Housing can cover through the Section 312 Program, there are other funds designated for the West Washington- Chapin Street area which can fill the ap. Upon a motion by Mr. Combs, seconded by Mr. Pias cki and unanimously carried, the ComLssion approved the Section 312 loans listed above. b. C ssion approval requested for Resolution No. of )ursement to the City _tures made within the bLua paxer uorri.aor Development Area. Mrs. Kolata noted that one of the ways of using tax incremental financing is to re' urse the City for eligible expenditures it makes in a tax incremental district. During 1987, City funds were used to pay for the 35,923 University of Michigan study of the Studebaker Corridor. The T.I.F. account -3- Loan $17,550.00 $19,000.00 $11,650.00 $ 8,500.00 COMMISSION APPROVED SECTION 312 LOANS South Bend edevelopment Commission Regular Mee ing - March 25, 1988 6. NEW BUSZESS (Cont.) b. Continued... does not have the entire $35,923, but a $10,233 reimbursement to the Community Development Block Grant fund with available funds is requested at this time. It will be reprogrammed as program income and spent on future Studebaker Corridor activities. Upon a motion by Mr. Piasecki, seconded by Mr. Combs and unanimously carried, the Commission approved Resolution No. 835 authorizing reimbursement to the City of South Bend for expenditures made within the Studebaker Corridor Development Area. c. Appointment of Members of the Design Review Committee for the South Bend Central Development Area. Mrs. Kolata noted that the terms of the rs of the South Bend Central Deve opment Area Design Review Committee have expired. The existing members are all being reappointed and the vacancy that has existed for the Monroe Park representative is being filled by Pat Hagen, membDrs; a Monroe Park resident. The of the Design Review Committee until April 1, 1989, will be John Lesz zynski, Richard Johnson, Jack Math ws, Jon Hunt, William Kemp, Jim Cook Bruce Huntington, and Pat Hagen. Upon a motion by Mr. Combs, seconded by Mr. Piasecki and unanimously carried, the ComTdssion approved the appointments to the pesign Review Committee for the South Bend Central Development Area. Mrs. time ment of Members of the Committee for the West Development Area. Kolata noted that the Design Review .ttee for the West Washington - Chapin opment Area was established at the the development area was declared. -4- COMMISSION APPROVED RESOLUTION NO. 835 AUTHORIZING REIMBURSEMENT' TO THE CITY OF SOUTH BEND FOR EXPENDI- TURES MADE WITHIN THE STUDEBAKER CORRIDOR DEVELOPMENT AREA COMMISSION APPOINTED MEMBERS OF THE DESIGN REVIEW COMMITTEE FOR THE SOUTH BEND CENTRAL DEVELOPMENT AREA COMMISSION APPOINTED MEMBERS OF THE DESIGN REVIEW COMMITTEE FOR THE WEST WASHINGTON- CHAPIN DEVELOPMENT AREA South Bend edevelopment Commission Regular Meeting - March 25, 1988 6. NEW BUSINESS (Cont.) d. Continued... It Nvill consist of four appointments by position: Jon Hunt as Director of the Depirtment of Economic Development, Jack Mathews as Building Commissioner, Richard Jo son as head of the Area Plan . Conmission and John Leszczynski as City Engineer. The four representatives from the West Washington - Chapin area will be J s Mullins, Carl Works, Neil Gilbert, and Eugenia Braboy. This Committee will be 4ealing with non - residential project Upom a motion by Mr. Combs, seconded by Mr. Piasecki and unanimously carried, the Co ssion approved the appointments to the Design Review Committee for the West Was ington- Chapin Development Area. e. C ssion action on parcels E3 -3, E3 -4, E3-JA, E3 -4A, and E9 -11 in the South Bend Area. Mrs Kolata noted that at the February 26th meeting the Commission asked that a letter be sent to the developer for this pro ect asking that they have their financing in place by March 25th. One par el is under Contract, but the schedulein the Contract has not been adhered to. The other parcels have been awa ded to the developer, but no Contract for Sale of Land has been executed. Mr. Gene Conard, a member of the partnership which was awarded the prorerty, was present and filed a letter with the Ccmmission requesting that the CcrrnLission withdraw their Notice of Def ult and their intent to rescind the awa d of the property. His letter reqLested that the Ccmmission amend the exi ting Contract to reflect a new prc, sche:dul e �::i tri a Bec,in ConFtructi.on date of December 1988, cha gets in the partnership, and changes in e proposed project. -5- South Bend edevelopment Commission Regular Meeting - March 25, 1988 6. NEW BUSINESS (Cont.) e. c:ontinuea... Mr. Conard explained the status of the project. The partnership now consists of hi elf and Merrill Jones, the architect. Cincinnati Mortgage will be the co-insurer. Draper and Kramer will manage the property. Bond counsel will con inue to be William Hoops of Butler and Binion. He hoted that the Put Date of the bonds is December 988. The Termination Date of the bonds is December 1999. He provided a letter from bond counsel, Butler and Binion, stating its opinion that use of the land is restricted until at least December, 1988. Mr. Conard explained some of the reasons the project has moved so slowly. He noted that Draper and Kramer spent considerable time in South Bend reviewing the housing market study done by Nicholas Jamiotta and Associates. The original study indicated that there was not a market for highrise apartment living in do town South Bend. The marketing approval from HUD took 90 days instead of 30 (lays. Also, the developer had pictures taken at each floor level sha,7ing views of the city from the different heights. It took three weeks for the photographer to get good day to tak the pictures. Mr. Conard described the project as it is now proposed. The partnership is plaiming an 18 story building with 214 units. No speculative retail is planned for the first floor. The partnership wou d be willing to include retail on the first floor if there was a tenant . co tted to it. The original proposal of it three level parking garage has been chahged to a two story garage with par ing for 189 cars. Mr. Conard ind sated that he had talked to Jack Ma ews, Building Commissioner and South Bend Regular MeE 6. NEW BUc e. Cor elopment Commission - March 25,1988 (Cont.) believes that zoning will allow the 18 stc4ry building as well as the reduced n r of parking spaces. When the project was first proposed, Lloyds Bank indicated that they would provide a Letter of Credit upon bond closing. Lloyds Bank has since closed all U.S. operations and will not be providing that Letter of Credit. As a fall -back, the partnership had simultaneously been trying to secure Cincinnati Mortgage as a co- insurer. Mr. Conard will submit the financing package to incinnati Mortgage for preliminary approval on March 28th if the Commission approves the changes requested today. Mr. Conard explained that the partnership would submit the final working drawings to incinnati Mortgage on May 28th for a fi financing approval. Mr. Conard indicated that the partnership would like the Commission to accept the following project schedule: final arc itectual drawings submitted by May 28, firm financial commitment from Cin innati Mortgage by June 28, bond sale on Septerrber 15, FHA closing September 29, bond closing on September 30, and start of construction October 1, 1988. Mr. Conard then displayed site plans to explain the parking options he is pro sing. The two story garage, acc modating 189 cars, would provide 70% parking for the 214 apartment units. Altiough he would prefer to have a one--to-one ratio, he indicated that Jack Mathews said that he could "get behind and support this" arrangement. Mrs. Kol to pointed out that no one could spaik for the Board of Zoning Appeals on this regard. Mr. Conard stated that there are two city lots on the garage site which the partnership no longer con rols. The partnership would like to -7- South Bend Pedevelopment Commission Regular Mee ing - March 25, 1988 6. NEW BUSIINESS (Cont.) e. uominuea.. . n them and build a rectangular e. If they are not able to obtain the partnership will build the e excluding that area. They would offer surface parking in an area of the building in addition to the Mr. Piasecki asked how many parking spa es would be eliminated from the garage if the two lots were not acquired. Mr. Conard that that would reduce the spa es by 30. Mr. Combs asked what action Mr. Conard was requesting of the Commission. Mr. Conard responded that he would like the Co ssion to rescind their notice of default and make appropriate amendments to the Contract for Sale of Land to reflect the schedule changes he mentioned previously. Mr. Piasecki asked what was the minimum t' these things could be accomplished. Mr. Conard responded that this is a more difficult project than the Raintree Point project and it could not be ready to begin construction before October 1, 1988. Ms. Auburn asked why it is a more difficult project. Mr. Conard responded that it is pioneering highrise in do town South Bend. He stated that the partnership had had a difficult time con incing Nick Jannotta that there was a market for it. Ms. Auburn responded that the concept may be different, but the mechanics of pulling the project together are not pioneering. Mr. Conard responded that the mechanics are similar, but the que tion that had to be answered before the partnership could secure financing was whether there was a market for it, South Bend Regular Me elopment Commission - March 25, 1988 6. NEW BUSINESS (Cont.) e. Lonrinuea... and it was difficult to convince the investors. It was a whole sequence of events to get Draper and Kramer involved, to get HUD involved. HUD has now said that the project may be insured by Cin innati Mortgage. Mrs Kolata asked if the Commission has the assurance that the project has passed all of the marketing tests. Mr. Conard responded that it wouldn't pass all of the marketing tests until Cincinnati Mor cage commits to the co- insurance. Ms. Auburn stated that we seem to be going over the same ground about the financing as we did last summer. Her notes indicate that HUD approval was nent then. Mr. Conard said HUD gave app oval in August or September that they wou d allow this project to be co- insured. Ms. Auburn asked why Cincinnati Mortgage is not ready with their decision if they were considering co- insurance back in August or September 1987 as her notes reflect. Mr. Conard responded that Lloyds Bank's financing was more attractive and the partnership waited on Cincinnati Mortgage until after Llo ds Bank backed out. Ms. Auburn asked about the change in the mexdDers of the partnership since the original people are no longer involved. The Commission doesn't have any documents on Eile indicating who is involved in ownership, who Mr. Conard represents, if Mr. Conard has an ownership position in the project. The Commission also has questions about what the project is because the project keeps changing. Mr. Conard indicated that he will supply documents indicating that he and Merrill Jones are the partners in Mill Race Par ership. He indicated that it is impDrtant to have the partnership remain "Mi 1 Race Partnership" since that is how the bonds were closed. South Bend edevelopment Commission Regular Meeting - March 25, 1988 6. NEW BUSINESS (Cont.) e. conitinuea .. . Ms. Auburn asked what the project cost is now Mr. Conard responded that the partnership floated $20,000,000 worth of bonds. That would be ample for the $14,00,000 project cost. Ms. Auburn asked what would happen to the other $6,000,000. Mr. Conard indicated that it wou d be returned to the bondholders. Ms. Auburn expressed concern about the qua ity of a project that had dropped in cos from $20,000,000 to $14,000,000. Mr. Conard responded that the project had never been a $20,000,000 project, but that it is common to float more IRB's th necessary to be safe. Mr. Carter Wolf expressed Center City Associates' concern about the impact of an 18 story apartment building on the nature of the East Bank Area, particularly if the developer couldn't fil all the units. He didn't feel there was la market for that type of living in South Bend. MtMr. Conard offered to have Merrill Jones ., Conard talk to the Commission if they wou d like him to. Ms. Auburn stated that the Commission needs additional information from Mr. Co rd and the partnership. She regiested that he bring up to date all of the documentation requested in the default letter of July 1987. She also asked for documentation of the partnership, who is involved in the partnership, financial information on the partnership and Exhibits 3, 4, 5, & 6 of the bid packet describing the revised project. Those documents must be submitted to the Commission by April 8th which will give the Commission time to look at them prior to the April 15th meeting. Mrs. Kolata will see that Mr. Con rd has copies of the documents to work from. -10- South Bend Re Regular Meeti 6. NEW BUSIIS elopment Commission - March 25, 1988 (font.) e . 1.0I1 L111uCu .. . Upon j, motion by Mr. Piasecki, seconded by Mr, Combs and unanimously carried, the Con-mission requested Mr. Conard to produce the documentation requested in the iialy 1987 default letter and the suppl ntal information listed by Ms. Auburn by April 8, 1988. Mrs. olata also asked him to submit rende ings of the proposed project by that ate. 7. PROGRESS Mrs. Kolata noted that this is Gretchen Matthews last day. She is leaving to take a pcisition with an architectual firm in Balti re, Maryland. The Commission wished h r the best of luck in her new position and thanked her for the good work she had done while working for the 8. NEXT COMI'}'IISSION MEETING 9P The next Regular Meeting of the Redvelo nt Commission is scheduled for April 8, 1988, but Mrs. Kolata requested that the meeting be rescheduled to allow the requ'red time before the Public Hearing on the South Bend Central navPln nt Area to be held at that meeting. Upon a notion by Piasecki, seconded by Mr. Combs and unanimously carried, the commission rescheduled the April 8, 1988 meeting to April 15, 1988, at 10:00 a.m. There being no further business to come before the Commission, Mr. Combs made a motion that the meeting be adjourned. Mr. Pia ecki seconded the motion and the meeting was adjourned at 11:00 a.m. .9�1 COMMISSION REQUESTED MR. CONARD TO PRODUCE THE DOCUMENTATION REQUESTED IN THE JULY 1987 DEFAULT LETTER AND THE SUPPLEMENTAL INFOR- MATION LISTED BY MS. AUBURN BY APRIL 8, 1988 PROGRESS REPORTS COMMISSION RESCHEDULED ITS NEXT REGULAR MEETING TO APRIL 8, 1988 ADJOURNMENT Ann S. Kolata, -11- n .T Executive