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HomeMy WebLinkAbout03-28-13 Redevelopment Commission MinutesSOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING March 28, 2013 9:30 a.m. 227 West Jefferson Boulevard Presiding: Marcia I. Jones, President South Bend, Indiana 1. ROLL CALL Members Present: Ms. Marcia Jones, President Dr. David Varner, Vice President Mr. Greg Downes Ms. Valerie Schey Mr. John Stancati Members Absent: Mr. Donald Alford Sr., Secretary Legal Counsel: Mr. Lawrence Meteiver, Esq. Redevelopment Staff: Mr. Don Inks, Director Mrs. Cheryl Phipps, Recording Secretary Mr. David Relos, Economic Development Specialist Ms. Debrah Jennings, Property Manager Others Present: Mr. Scott Ford, Executive Director Mr. Chris Fielding, Assistant Executive Director Mr. Cecil Eastman Mr. Randy Rompola Mr. Conrad Damian Ms. Katrina Marquardt 2. APPROVAL OF MINUTES A. Approval of Minutes of the Regular Meeting of Thursday, March 14, 2013 Upon a motion by Mr. Downes, seconded by Ms. Schey and unanimously carried, the Commission approved the Minutes of the Regular Meeting of Thursday, March 14, 2013. 3. APPROVAL OF CLAIMS 324 AIRPORT AEDA Cressy & Everett Management Corp. 15,424.98 Management Svcs Agreement for Bosch Site Crowe Horwath 5,388.14 Comp 12 Pay 13 TIE South Bend Redevelopment Commission Regular Meeting —March 28, 2013 3. APPROVAL OF CLAIMS (Cont.) 324 AIRPORT AEDA Meridian Title 99,476.65 Meridian Title 375.00 Jones Petrie Rafinski 2,694.50 Jones Petrie Rafinski 1,500.00 Plews Shadley Racher & Braun LLP 2,817.00 Shaffner Heaney Associates, Inc. 44,412.75 All Phase Electric Supply 65,727.63 420 FUND TIE DISTRICT -SBCDA GENERAL Ampco System Parking 748.20 Crowe Horwath 1,755.50 South Bend Water Works 40.00 R.E. Pitts & Associates, Inc. 3,500.00 Architecture Design Group 1,000.00 726 -730 E Sample Michael Beres Covaleski Stadium & 1509 S Kendall St Ivy Tower 917 Lafayette Blvd - Hamilton Towing Furniture repair/Replacement Fagade Improvements Lot 4 of Ignition Park Purchase Electrical Equipment for Union Station Technology Center St. Joseph Surface Garage / 255 Main Street Comp 12 Pay 13 TIF 325 S Lafayette St. Real Estate Appraisal of 211 W. Washington SB Century Center West Entry Improvements 422 TIE DISTRICT WEST WASHINGTON Crowe Horwath 237.12 Comp 12 Pay 13 TIF 426 FUND SOUTH BEND CENTRAL MEDICAL DISTRICT Crowe Horwath 1,584.17 Comp 12 Pay 13 TIF The Troyer Group Skyway Memorial B Warner, Bank & 1232.76 MarMain Phase H Holladay Construction Group, LLC 429 TIF FUND NORTHEAST DISTRICT Crowe Horwath 142,785.00 Memorial Hospital Fagade 780.76 Comp 12 Pay 13 TIF 430 FUND SOUTH SIDE DEVELOPMENT TIF AREA #1 Crowe Horwath 1,197.21 Comp 12 Pay 13 TIF Jones Petrie Rafinski 410.00 R/W Layout & Engineering - Erskine Corridor Lawson - Fisher Associates P.C. 4,261.72 So. Main St to Lafayette Blvd Connector Purchase of Right of Way for Ireland future The Graber Group, L.P 17,236.00 pedestrian & traffic projects Geyser Asset Management Purchase of Right of Way for Main St. /Lafayette Connector from Ireland to 81,299.00 Chippewa Cardno JFNew 1,796.28 Fellows St ARC 393.69 Printing - Main/Lafayette Connector 2 South Bend Redevelopment Commission Regular Meeting —March 28, 2013 3. APPROVAL OF CLAIMS (Cont.) 430 FUND SOUTH SIDE DEVELOPMENT TIF AREA #1 Christopher Burke Engineering LLC SB Corridor Improvements vs Intersection Norco Pipe Line Company, LP 432 TIF SSDA #3 - ERSKINE VILLAGE Crowe Horwath 435 TIF- DOUGLAS ROAD Crowe Horwath 3,889.00 Improvements 6,199.10 Erskine Pond Pipe Removal 1,197.21 Comp 12 Pay 13 TIF 1,197.21 $ 510.556.58 Comp 12 Pay 13 TIF Upon a motion by Mr. Downes, seconded by Ms. Schey and unanimously carried, the Commission approved the Claims submitted March 28, 2013. 4. COMMUNICATIONS A. E -mail Communication 3/27/13 No name of sender Mr. Inks noted that an e -mail communication was received through the city's Web page with no indication of who sent it. 1'd like to know what efforts the commission took to insure that the provisions of the afore mentioned state law were followed; specifically I would like to know what efforts the commission or the CDC (Heritage Foundation) took to insure that the low and very low - income community were aware of the employment and contracting opportunities that were available at the building on Williams and Colfax that is being rehabbed as senior housing. Contact Information: my phone # is 540- 394 -061. Mr. Inks noted that he was not sure if this was required under the block grant program or not, however it is not required under the TIF laws through the state, which are the funds used for the project. Ms. Jones added that as a member of the South Bend Heritage Foundation Board of Directors, she is sure South Bend Heritage has given notification to the low- income community. 5. OLD BUSINESS There was no Old Business. South Bend Redevelopment Commission Regular Meeting —March 28, 2013 6. NEW BUSINESS A. Housing (1) Subordination Agreement with Inova Federal Credit Union for loan in connection with the South Bend Home Improvement Program (Dawn L. Martin, 1017 S. 30`' Street) Mr. Inks noted that Dawn Martin was approved for a South Bend Home Improvement Program (SBHIP) loan at a regular meeting of the South Bend Redevelopment Commission in 2005. Ms. Martin received repairs on her home through the SBHIP. Repair costs were funded by CDBG funds appropriated to the program by the City of South Bend. Ms. Martin received a 50% grant and the remaining 50% in a loan with 0% interest. Ms. Martin makes monthly payments to the City of South Bend and the account is in good standing. The SBHIP loan is in second position. Ms. Martin is in the process of refinancing the first mortgage with her credit union for a (much) better interest rate and without taking out equity; she is asking the SBHIP to subordinate its 0% interest loan back to second position. Staff asks that the subordination be allowed and the agreement signed. Upon a motion by Mr. Varner, seconded by Mr. Downes and unanimously carried, the Commission approved the Subordination Agreement with Inova Federal Credit Union for a loan in connection with the South Bend Home Improvement Program (Dawn L. Martin, 1017 S. 30th Street) B. South Bend Central Development Area (1) Resolution No. 3132 approving and authorizing the execution of an Addendum to the Master Agency Agreement (Studebaker Plaza Project construction) Mr. Kain noted that on March 14, 2013, the Redevelopment Commission approved a contract for services with Joseph Dzierla & Associates to create construction and bidding documents for this project. This agency agreement will make the Board of Public Works responsible for the public bidding and awarding of the bid for the project. Staff requests approval of Resolution No. 3132. Mr. Varner asked how the city is protecting its investment, since we don't own the property. Mr. Kain responded staff is working on a development agreement with Citizens Bank. Upon a motion by Mr. Downes seconded by Mr. Varner and unanimously carried, the Commission approved Resolution No. 3132 approving and authorizing the execution of an Addendum to the Master Agency Agreement (Studebaker Plaza Project construction) (2) Extension to Listing Agreement with Hallmark Realty for 620 Columbia St. Mr. Relos noted that on September 27, 2011, the Redevelopment Commission entered into Listing Contracts with Hallmark Real Estates for the marketing and sale of five former Housing Development Corporation houses in Monroe Park. Those contracts were for 13 South Bend Redevelopment Commission Regular Meeting —March 28, 2013 6. NEW BUSINESS B. South Bend Central Development Area (2) continued... approximately six months, ending on March 18, 2012. On March 27, 2012, the Redevelopment Commission approved a six month extension for the two remaining properties. Since that time, one of the two remaining properties has been sold, leaving one property of the original five listed. This is an extension for six months of the Listing Contract for the remaining property, 620 Columbia Street, ending September 28, 2013. Staff requests approval of the extension with Hallmark Real Estate, so they may continue to market this property. Upon a motion by Mr. Downes, seconded by Ms. Schey and unanimously carried, the Commission approved the Extension to Listing Agreement with hallmark Realty for 620 Columbia St. (3) Staff Report on Leighton Plaza Item 6.B.(3) was withdrawn. (4) Resolution No. 3133 continuing certain funds and accounts in connection with the Lease dated as of November 1, 1993, as amended, between the South Bend Redevelopment Commission and the South Bend Redevelopment Authority and regarding related matters. (Century Center Bond Refunding) Mr. Inks noted that interest rates have fallen since the Century Center Bonds were issued in 2008. It is estimated that refinancing now would save $346,000 over the remainder of the bond term, net of new issuance costs. The net present value of these savings is estimated to be $284,000. The bond maturity will stay at the original date of May 2028. It is estimated bond payments will decline by about $25,000 per year. These bonds are being paid by Hotel/Motel tax revenues. Mr. Randy Rompola, Faegre Baker Daniels, noted that the Hotel /Motel tax board pledged up to $600.000 a year for debt service on these bonds. The debt service is far less than that. What isn't used for debt service is returned to the Hotel /Motel tax board. From a savings standpoint the estimated percentage of savings will range between 6.1%-7.3%. The industry standard deciding whether it is economical to do a refunding is 3 %. In 2008, the rates on the old bonds ranged from 4' /z% - 5.6 %. The new rates are estimated at a range of 2% - 3/1 %. Upon a motion by Mr. Downes, seconded by Ms. Schey and unanimously carried, the Commission approved Resolution No. 3133 continuing certain funds and accounts in connection with the Lease dated as of November 1, 1993, as amended, between the South South Bend Redevelopment Commission Regular Meeting —March 28, 2013 6. NEW BUSINESS B. South Bend Central Development Area (4) continued... Bend Redevelopment Commission and the South Bend Redevelopment Authority and regarding related matters. (Century Center Bond Refunding) C. Airport Economic Development Area (1) Resolution No. 3124 accepting the transfer of real property from the South Bend Redevelopment Authority. (Blackthorn Golf Course and multiple lots in Blackthorn Corporate Park) Mr. Relos noted that most city owned lots in Blackthorn are in the name of the Redevelopment Authority. Since all bonds for Blackthorn are now fully paid, and in a continuation of the effort to transfer properties to the appropriate city agency, staff has begun the process to transfer these lots from the Authority to the Commission. When development opportunities occur in Blackthorn, having the properties already transferred to the Commission will allow for a quicker turn around when closing on the property. On March 20, 2013, a resolution to transfer these lots was approved by the Authority, subject to Commission approval of this Resolution. Once both bodies approve their respective resolutions, deeds will be prepared to complete the transfer. Staff requests approval of Resolution No. 3124. Ms. Jones asked Mr. Inks to explain for the audience why the Redevelopment Authority is involved. Mr. Inks responded that the Redevelopment Authority is specifically set up to issue lease revenue bonds. When the bonds are issued, they are used to purchase physical assets, such as land, building, etc., or to build a building. Whatever that asset is, is then leased from the Redevelopment Authority to the Redevelopment Commission so that the Commission can use its resources (often TIF funds) to make the lease payments and pay the bonds that are issued by the Redevelopment Authority. One of the prime benefits of using these revenue bonds is they do not count against the bond cap that the Redevelopment Commission has. When those assets are leased from the Authority to the Commission, the provisions of those leases indicate that at the time the bonds are paid off, the property is to be transferred to the Redevelopment Commission. The Redevelopment Authority has no function other than to issue bonds. Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission approved Resolution No. 3124 accepting the transfer of real property from the South Bend Redevelopment Authority. (Blackthorn Golf Course and multiple lots in Blackthorn Corporate Park) v South Bend Redevelopment Commission Regular Meeting —March 28, 2013 6. NEW BUSINESS C. Airport Economic Development Area (2) Resolution No. 3129 approving and authorizing the execution of an Addendum to the Master Agency Agreement (Hamilton Towing, 910 S. Lafayette Demo Project) Mr. Relos noted that 910 S. Lafayette was part of the Hamilton Towing properties acquired in June 2012. Other portions of Hamilton Towing have been cleared, but the date of possession for 910 S. Lafayette is April 30, 2013. In an effort to clean and clear this property promptly, staff has been working with the city's Engineering Department to prepare demo specs, quote the job, and oversee the work. The estimated budget for this project is $75,000. Staff requests approval of Resolution No. 3129 and the Addendum to Master Agency Agreement for the demolition of this property, in a not -to- exceed amount of $75,000. Upon a motion by Mr. Varner, seconded by Mr. Downes and unanimously carried, the Commission approved Resolution No. 3129 approving and authorizing the execution of an Addendum to the Master Agency Agreement (Hamilton Towing, 910 S. Lafayette Demo Project) (3) Resolution No. 3131 approving the transfer of real property to the City of South Bend, Indiana. (Southeast Triangle) Mr. Relos noted that in July 2001 the Redevelopment Commission approved Resolution No. 1839, adding properties in the Southeast Triangle to the acquisition list of the Airport Economic Development Area. At its last meeting on March 14, 2013, the Commission approved the acquisition of the last remaining property in that area. Of the 39 parcels in that area, some are in the name of the Board of Public Works (BPW), and some in the name of the Redevelopment Commission. To get all properties in common ownership, Resolution No. 3131 transfers those parcels in the name of the Commission to the BPW. Staff requests approval of Resolution No. 3131. Mr. Inks noted that the City of South Bend has recently let it be known that the entire training center is moving to this site. That is the reason for transferring of property from the Redevelopment Commission to the City of South Bend. Upon a motion by Mr. Downes, seconded by Ms. Schey and unanimously carried, the Commission approved Resolution No. 3131 approving the transfer of real property to the City of South Bend, Indiana. (Southeast Triangle) (4) Lease Termination Agreement with Robert Bosch Corporation for 401 N. Bendix. Mr. Inks noted in August of 2000, the Robert Bosch Corporation (Bosch) entered into a 20 year lease for property located at 401 N. Bendix. Under the terms of that lease, in the event Bosch terminated the lease before the 20 term was completed; Bosch would be subject to South Bend Redevelopment Commission Regular Meeting —March 28, 2013 6. NEW BUSINESS C. Airport Economic Development Area (4) continued... certain Repayment Amounts and Lease Termination Penalties. In addition, Bosch, upon leaving the site was also required to enter into an Environmental Indemnity Agreement with the City of South Bend. Bosch exited the site and terminated its lease on December 31, 2012. Lease Termination Agreement In accordance with the lease, Bosch is agreeing to the following: 1. A lease termination penalty of $1,327,083.33. 2. A repayment amount of $746,071.71, which will allow the City of South Bend to repay funds borrowed from local and State sources to complete the original project. 3. Payment over time of an Indiana Development Finance Authority loan with a current balance of $538,508.13. This loan will be repaid in accordance with the original repayment schedule. Environmental Indemnity Agreement 1. Bosch is agreeing to indemnify the City for any environmental issues arising from its occupancy of the site between 4/1/96 and 12/31/12. 2. The City of South Bend is agreeing to indemnify Bosch for any environmental issues arising after 12/31/12 not due to Bosch's occupancy. Ms. Schey asked if Bosch had been leasing the property from the Redevelopment Commission. Mr. Inks responded that the lease agreement was with the City of South Bend. Ms. Schey asked if the lease payments, then, went into the general fund. Mr. Inks responded that there were no lease payments under that lease. The lease had a 20 year term where there were no payments to the city. If the lease was renewed beyond that point, then it went to a market rate and there would have been payments. Ms. Schey asked how the City of South Bend become the owner of the property. Mr. Inks responded that it was an Economic Development Project to retain 500 engineering jobs in the community. As a part of that effort the City of South Bend acquired the property for $1.5 million in August 2000, and leased it to Bosch. Ms. Schey asked if the terms of the lease were that if Bosch left early, they would have to pay $1,327,083.33. Mr. Inks responded that this particular term had a proration clause, so they would pay so much per day for every day they left before the end of the lease. South Bend Redevelopment Commission Regular Meeting —March 28, 2013 6. NEW BUSINESS C. Airport Economic Development Area (4) continued... Ms. Schey asked where that money will go. Will it be earmarked specifically for the Bosch plan or for other projects around the city? Mr. Inks responded that the decision about where the money will go has not been decided yet. These documents just guarantee that the City of South Bend will receive the funds, but they do not specify where the funds will go. Mr. Varner asked whether all the land that was purchased and the improvements that were made to create the campus, including the rerouting of Bendix Ave., were made at the expense of the City of South Bend. Mr. Inks responded that it was. Mr. Varner asked if the city released Bosch from property tax obligations. Mr. Inks responded no, that Bosch was paying property taxes. Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission approved the Lease Termination Agreement with Robert Bosch Corporation for 401 N. Bendix. (5) Environmental Indemnity Agreement with Robert Bosch Corporation for 401 N. Bendix. Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission approved the Environmental Indemnity Agreement with Robert Bosch Corporation for 401 N. Bendix Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission approved the Consent to Addition of Party to the Environmental Indemnity Agreement with Robert Bosch Corporation for 401 N. Bendix. D. West Washington - Chapin Development Area (1) Resolution No. 3130 approving and authorizing the execution of an Addendum to the master Agency Agreement (913 Napier Demo Project) Upon a motion by Mr. Downes, seconded by Ms. Schey and unanimously carried, the Commission tabled Item 6.D.1. indefinitely. E. South Side Development Area There was no business in the South Side Development Area. South Bend Redevelopment Commission Regular Meeting —March 28, 2013 6. NEW BUSINESS F. Northeast Neighborhood Development Area There was no business in the Northeast Neighborhood Development Area. G. Douglas Road Development Area There was no business in the Douglas Road Development Area. 7. PROGRESS REPORTS Mr. Inks noted that staff put out two requests for proposal, one for the LaSalle Hotel and one for the Hill and Colfax lot. 8. NEXT COMMISSION MEETING The Next Regular Meeting of the Redevelopment Commission is scheduled for Thursday, April 11, 2013 at 9:30a.m. 9. ADJOURNMENT There being no further business to come before the Redevelopment Commission, Ms. Schey made a motion that the meeting be adjourned. Mr. Downes seconded. The meeting was adjourned at 9:56 a.m. D nald E. Inks, Director 10 Marcia I. Jones, Presi e