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HomeMy WebLinkAbout1994-06-07 Minutes SOUTH BEND REDEVELOPMENT AUTHORITY REGULAR MEETING June 7, 1994 4:30 p.m. Presiding: Andre Gammage Vice-President 1308 County-City Building 227 W. Jefferson Boulevard South Bend, Indiana 46601 The June 7, 1994 Regular Meeting of the Redevelopment Authority was called to order at 4:42 p.m. by its Vice President, Andre Gammage. There was a quorum present. 1. ROLL CALL Members Present: Members Absent: Redevelopment Staff: 2. APPROVAL OF MINUTES Others: Mr. Andre B. Gammage, Vice-President Ms. Mary O. Ferlic, Secretary Mr. Joseph W. Wroblewski, President Mrs. Ann Kolata, Director Mrs. Martha Lantz, Recording Secretary Mr. James Riggs, Economic Dev. Specialist Mr. Randy Rompola, Baker & Daniels a. ~~roval of Minutes of the Regular Meeting of 'It-esdav Mav 17, 1994. Upon a motion by Ms. Ferlic, seconded by Mr. Gammage and unanimously carried, the Authority approved the Minutes of the Regular Meeting of Zliesday, May 17, 1994. 3. NEW BUSINESS a. Authority aanroval requested for Resolution No 92 apnrovine modifications to the Lease for the College Football Hall of Fame/Century Center Proiect and approvin~~the execution of an addendum to the Lease and re~ardine other related matters. Mr. Rompola explained that the bonds for the Century Center acquisition were priced on May 24th. The Underwriter is First Chicago Capital Markets. The net interest rate for the bonds was 6.31 % . This interest rate is higher than what was expected 6-8 months ago when the original lease approval was done. At that time, we were anticipating a rate of about 5 % rather than 6.3 % . -1- South Bend Redevelopment Authority Regular Meeting -June 7, 1994 3. NEW BUSINESS (Cont.) a. continued... When we sized the lease rental amount, we put in a higher lease rental amount so that we could withstand increases in the rate, the idea being that once the bonds were priced we would reduce the lease rental to re~ect the actual interest rate. We are here today with that resolution and the lease rental can be reduced. The semi-annual lease rental listed in the lease was $300,000. The Lease Addendum attached to the Resolution reduces the lease rental amount to $297,000.00 semi-annually, fora $3,000.00 reduction. We would have anticipated an even greater reduction, but given the fact that rates have increased in the last 4-5 months, that is not possible. The Lease Addendum also changes some of the terms relating to the lease. Basically, the idea was that when the lease was originally done, there was to be one bond issue: a combined Century Center and Hall of Fame Bond. As we proceeded along that plan, it became clear that there were some savings to the City by splitting it up and having a separate Century Center Bond at a • fixed rate and then a Hall of Fame financing at a variable rate. We are proceeding on that basis, and to do that we need to break out some of the terms in the lease to recognize that there will be two separate bond issues and the lease rentals will be pledged separately to each bond issue. The Redevelopment Commission has already adopted a pledge resolution with respect to the Century Center portion, and once we finalize the structure of the Hall of Fame portion, the Commission will then adopt a pledge resolution relating to that lease rental. Mr. Gammage asked whether there was one lease or two leases in the previous resolution, and whether they were listed as both fixed rates at that time. Mr. Rompola answered that in the original lease it identified the project as having two components, one being a Century Center portion and the other being a Hall of Fame portion, and had identified separate lease rentals being applied for each portion, so there are distinct lease rental payments being applied, but what we didn't have at that time was an option to purchase just the Century Center bonds or just the Hall of Fame bonds. This is on page 7 of the Addendum to Lease. It is still one lease, but two bond issues will be supported by the same lease. When the maximum lease rentals were established, we were looking at fixed rates. Even though we are making this change, we are still held to the maximum payment. -2- • South Bend Redevelopment Authority Regular Meeting -June 7, 1994 3. NEW BUSINESS (Cont.) a. continued... Upon a motion by Ms. Ferlic, seconded by Mr. Gammage and unanimously carried, the Authority approved Resolution No. 92 approving modifications to the Lease for the College Football Hall of Fame/Century Center Project and approving the execution of an addendum to Lease and regarding other related matters. b. Authority at7proval requested for Resolution No. 93 accepting the transfer of real prooert,~ from the City of South Bend. Indiana. Mrs. Pitts Manier explained. that this resolution is a counterpart to a resolution passed by the Board of Works on May 23, 1994 where they resolved to sell to the Redevelopment Authority the Century Center land and improvements, which the Redevelopment Authority needs to own in order to issue the bond it intends to issue to make improvements to the Century Center. This resolution • is indicating the Redevelopment Authority's acceptance of the Century Center land and improvements. Upon a motion by Ms. Ferlic, seconded by Mr. Gammage and unanimously carried, the Authority approved Resolution No. 93 accepting the transfer of real property from the City of South Bend, Indiana. c. Authority abnroval reauested for Assignment of Lease Agreement with the Redevelopment Commission. (Century Center) Mrs. Pitts Manier explained that the Century Center is currently owned by the Civic Center Building Authority and leased to the City. The City has a sublease with the South Bend Community School Corporation, so when the Redevelopment Authority takes title to the Century Center facility, it will want to have that sublease in place, but will want to insert the Redevelopment Commission as an interim party, so the Authority will own the facility and will lease it to the Redevelopment Commission, who will then sublease a portion of the facility to the .School Corporation. This Assignment of Lease Agreement indicates the Authority's intention to create that structure of leases and subleases. 3. NEW BUSINESS (Cont.) -3- • South Bend Redevelopment Authority Regular Meeting -June 7, 1994 c. continued... Upon a motion by Ms. Ferlic, seconded by Mr. Gammage and unanimously carried, the Authority approved the Assignment of Lease Agreement with the Redevelopment Commission (Century Center). d. Authori~ approval requested for Proposal from Economics Research Associates for professional services in the A~port Economic Development Area.. -Mrs. Kolata stated that the Redevelopment Authority has received a proposal from Economic Research Associates, who did the market study for the Hall of Fame Museum and have also done work for the Redevelopment Commission for the Studebaker Museum. We and Venterra, the group that the Authority hired to market the Hotel Site in the Blackthorn Corporate Park, have asked Economic Research Associates to go back and look at the hotel demand analysis. Any type of market information we have is quite old, so we asked ERA for a proposal to do a report/pro-forma/financial analysis. Their fee is $17,500.00 and would cover all expenses. They expect they would have the final report within eight weeks and maybe even a little bit sooner than that. Upon a motion by Ms. Ferlic, seconded by Mr. Gammage and unanimously carried, the Authority approved the proposal from Economics Research Associates for professional services in the Airport Economic Development Area. e. Authori.~ authorization requested to sign tax abatement petition on behalf of Crystal Mountain Water. Mrs. Kolata explained that this is land in the Toll Road Industrial Park near where Tech Data and Midwest Embroidery are going to build. Crystal Mountain Water is a bottler of distilled water. They are going to construct a 17,000 s.f. building before the end of this year. They currently employ 30 people, and expect to hire up to 10 additional employees. They are eligible for a three year abatement. The Redevelopment Commission has agreed to sell them the land. Crystal Mountain Water wants to apply for tax abatement, and as the owner of the property, the Redevelopment Authority needs to sign the tax abatement petition. Closing should be within the next 30 days. -4- • South Bend Redevelopment Authority Regular Meeting -June 7, 1994 3. NEW BUSINESS (Cont.) e. continued... Mrs. Kolata explained that with a tax abatement, the land never gets abated, so they would pay taxes on the current assessed value on the land. Abatement for real property is available for three, six or ten year periods. The South Bend City Council has passed an ordinance that specifies when tax abatement may be given. It depends on the size of the project, how many years of tax abatement each project is eligible for. Crystal Mountain Water is eligible for a three year tax abatement. The first year, 100 % of the improvement value does not get taxed. The next year only 33 % gets taxed, the third year, 66 gets taxed and after that they pay the full tax. Any industrial project within the City limits of South Bend that is over 10,000 s.f. in size will be almost guaranteed to receive some sort of tax abatement since the City Council has never turned an eligible project down that applied for tax abatement. Upon a motion by Ms. Ferlic, seconded by Mr. Gammage and unanimously • carried, the Redevelopment Authority gave authorization to sign the tax abatement petition on behalf of Crystal Mountain Water. f. Authorit authorization uested to si n title sheet for Blackthorn Golf Course Wetlands Plantin sg Dlans. Mr. Riggs explained that in November of 1993, the Redevelopment Authority hired Stewart Franzen, a landscape architect, to design a plantings plan for the wetlands that are within the Blackthorn Golf Course. The plantings will include Rushes, Black-eyed Susans and various other types of wetlands treatments to give the Golf Course more of a finished look. Most of the wetlands that are within the golf course are not natural. Water just collected in certain low spots and did not go away. The plans have to go out for bid, and need the title page to the plans signed by the Authority, approving those plans. Upon a motion by Ms. Ferlic, seconded by Mr. Gammage and unanimously carried, the Redevelopment Authority accepted the request for authorization to sign the title sheet for Blackthorn Golf Course Wetlands Plantings plan. Mrs. Kolata stated that there is one more item of New Business to add. • -5- • South Bend Redevelopment Authority Regular Meeting -June 7, 1994 3. NEW BUSINESS (Cont.) g. Authority app~recluested for proposal from Arborwise Ltd. for tree and site inspection for brae Oak tree at Blackthorn Golf Course. Mrs. Kolata explained that there is a very large, very old and very special Oak tree on the Blackthorn Golf Course. This proposal is to hire a tree consultant to come up with afive-year plan for how to maintain the tree. Mr. Riggs stated that this Oak is supposedly twice the size of the famed "Council Oak" that was hit by lightning. This tree was hidden in dense growth, and was found by the golf course architect when he was walking around the site. He explained that there was concern that now that the tree was in the center of the fairway and out in the open, that lightning might strike it. Mrs. Kolata stated that she thought that a lightning rod had been installed early on. Mr. Riggs answered that the lightning rod had never been installed. He said that it had been talked about, but nothing was ever done. Now that the construction is over, we need to make sure the tree is in good health. • Ms. Pitts-Manier asked what items #3 and #4 are on the proposal. She asked why they would be inspecting other trees, and what does it mean by "phone support for course superintendent. Mr. Riggs answered that is in case the superintendent has questions about how to treat the tree and what types of chemicals not to use on it or near it, etc. Mr. Riggs made a note on the proposal that those items are not to exceed a maximum of $250.00 for item number three and a maximum of $150.00 for item number four. Mr. Gammage wondered why there was a need to spend this much money on a tree that has already existed for approximately 200 years. Mrs. Kolata explained that they had cleared out around it. Mr. Riggs added that the tree had no value before it was discovered, and now that it has been discovered and is in the middle of a golf course, it is valuable. Because there will be an active use around this tree, we need to make sure that we know how to keep it healthy. There will be high school kids spreading fertilizer around it, people mowing around it, carts going by it, etc. Mr. Gammage stated that he felt the lightning rod should be installed before any more money is invested in the tree. Mrs. Pitts Manier suggested that we need to confirm that the lightning rod is part of the proposal from Arborwise. Mr. Riggs stated that the way he understood it when he talked with Mr. Ling from Arborwise, Ltd. , was that part of his report on the condition and future • -6- • South Bend Redevelopment Authority Regular Meeting -June 7, 1994 3. NEW BUSINESS (Cont.) g. continued... viability and preservation plan includes the correct way to install a lightning rod. Mrs. Kolata stated that it needs to be conveyed that task number one has to be the installation of a lightning rod, because we are just heading into thunderstorm season. We also do not pay the 2 % interest surcharge, so that has to come out. Also, under the Terms, the item that says "Arborwise, Ltd. reserves the right to use names, data and dates for research, publication and promotional purposes." has to come out. Upon a motion by Mrs. Ferlic, seconded by Mr. Gammage and unanimously carried, the Redevelopment Authority tabled action on the proposal to provide tree/site inspection for the large Oak tree in Blackthorn Golf Course from Arborwise, Ltd. 4. APPROVAL OF CLAIMS 1993 AIRPORT TAXABLE BOND Society National Bank $ 1527.50 Upon a motion by Mrs. Ferlic, seconded by Mr. Gammage and unanimously carried, the Authority approved the Claim submitted June 7, 1994 for approval. 5. NEXT AUTHORITY MEETING The next Regular Meeting of the Redevelopment Authority is scheduled for June 21, 1994 at 4:30 p.m. Mrs. Ferlic noted that she will not be present at the June 21, 1994 meeting. 6. ADJOURNMENT There being no further business to come before the Redevelopment Authority, Mrs. Ferlic made a motion that the meeting be adjourned. Mr. Gammage seconded the motion and the meeting was adjourned at 5:14 p.m. (,~, Cv ~= eph .Wroblewski, President ~~=~ /~-- Ann E. Kolata, Director -7-