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HomeMy WebLinkAboutRedevelopment Commission Minutes 04.24.25 - Signed CITY OF SOUTH BEND REDEVELOPMENT COMMISSION SOUTH BEND REDEVELOPMENT COMMISSION MINUTES April 24, 2025, at 9:30 a.m. BPW Conference Room, 13th Floor, County-City Building https://tinyurl.com/RDC-2025-4T The South Bend Redevelopment Commission was called to order at 9:33 a.m. President Troy Warner presiding. 1. ROLL CALL Members Present: Troy Warner, President David Relos, Vice President Eli Wax, Secretary Ophelia Gooden-Rodgers, Commissioner Marcus Ellison, Non-Voting Advisor Members Virtually: Gillian Shaw, Commissioner Legal Staff: Sandra Kennedy, Corporation Council - Virtual Danielle Campbell Weiss, Senior Asst. City Attorney Redevelopment Staff: Caleb Bauer, Exec. Director, DCI Sarah Schaefer, Deputy Director, DCI Erik Glavich, Director of Growth and Opportunity, DCI Rosa Tomas, Director of Finance, DCI Joseph Molnar, Asst. Dir. of Growth and Opp., DCI Blake Nipper, Intern, DCI Laura Hensley, Board Secretary, DCI Others Present: Leslie Biek, Assistant City Engineer Tina Patton, 707 Sherman Ave. Matt Barrett, 110 S. Niles Ave. Greg Swiercz, SB Tribune Tom Everett, Barnes & Thornburg LLP CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING – April 24, 2025 2 2. Approval of Minutes A. Approval of Minutes of the Regular Meeting of Thursday, April 10, 2025 The motion was made by David Relos to approve, second by Eli Wax. On the motion: • Troy Warner, President: Yes • David Relos, Vice President: Yes • Eli Wax, Secretary: Yes • Gillian Shaw, Commissioner: Yes • Ophelia Gooden-Rodgers, Commissioner: Yes The motion carried; the Commission approved the minutes of the regular meeting of April 10, 2025. 3. Approval of Claims A. Claims Allowances April 2, 2025 The motion was made by David Relos to approve, second by Eli Wax. On the motion: • Troy Warner, President: Yes • David Relos, Vice President: Yes • Eli Wax, Secretary: Yes • Gillian Shaw, Commissioner: Yes • Ophelia Gooden-Rodgers, Commissioner: Yes The motion carried; the Commission approved the claims allowances of April 2, 2025. B. Claims Allowances April 15, 2025 The motion was made by David Relos to approve, second by Eli Wax. On the motion: • Troy Warner, President: Yes • David Relos, Vice President: Yes • Eli Wax, Secretary: Yes • Gillian Shaw, Commissioner: Yes • Ophelia Gooden-Rodgers, Commissioner: Yes CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING – April 24, 2025 3 The motion carried; the Commission approved the claims allowances of April 15, 2025. 4. Old Business A. None 5. New Business A. River West Development Area 1. Amendment to Budget Request (Riverfront West Urban Neighborhood Development) Leslie Biek, Assistant City Engineer, introduced a $250,000 amendment to fund the complete design and bid documents for the Western Avenue improvements project. This project encompasses storm sewer, sanitary sewer, water main, and streetscape design elements. Notably, this section of Western Avenue was not part of the initial request. Vice President Relos asked the specific location of Western Ave. and Ms. Biek confirmed it will tie in near the Post Office. Secretary Wax inquired about what had changed since the first request and Ms. Biek stated that initially, we planned to simply pave it and use it as an access road. However, now we're going to include the full sidewalk curb work and connect all the utilities, transforming it into a complete road. This change will be reflected in the design and bidding documents. These documents, which we're preparing to bid in June, will upgrade the specifications from 10% to the complete project. The motion was made by David Relos to approve, second by Ophelia Gooden-Rodgers. On the motion: • Troy Warner, President: Yes • David Relos, Vice President: Yes • Eli Wax, Secretary: Yes • Gillian Shaw, Commissioner: Yes • Ophelia Gooden-Rodgers, Commissioner: Yes The motion carried; the Commission approved the Amendment as presented on April 24, 2025. 2. Resolution No. 3637 (Authorizing the Issuance of Tax Increment Revenue Bonds for Drewry’s/Portage/Elwood) CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING – April 24, 2025 4 Joseph Molnar, Assistant Director of Growth and Opportunity, presented agenda items 5.A.2-4. Resolution Nos. 3637 & 3638 are related to the authorization of bonds for the RAF loan. Just to provide some background again, the Residential Infrastructure Fund Program, managed by the Indiana Finance Authority (IFA), is specifically designed to support residential housing infrastructure construction and assist municipalities in encouraging new residential development. The program primarily targets smaller municipalities, but 30% of the funds are allocated for cities and municipalities with populations greater than 50,000, including South Bend. Essentially, the program offers a 20-year term low-interest loan, with the interest rate determined at closing. The interest rate will not exceed 5.5%, and we hope it will be a couple of points lower. Funds are provided through the IFA's purchase of redevelopment district bonds, which are then issued by the RDC. This funding is mainly set aside for site preparation and infrastructure work to incentivize residential housing. In December 2024, the city applied for $2.57 million and was approved by the IFA in January. We committed to 110 housing units at the Drewry’s/Portage Elwood sites, with two-thirds being single-family homes and one-third multi-family units. The RIF loan will fund environmental remediation, public utilities installation, demolition, and infrastructure support. Interest payments start within six months of closing, estimated at $100,000 annually, with principal payments beginning within 12 months after project completion. Tax revenue from the new housing will help repay the loan from River West TIF. The Drewry’s/Portage Elwood project is big and has taken years to get to this point. It'll take more years to finish. Right now, we're cleaning up the environment and demolishing old buildings to prepare for new development. This area has great potential for the northwest side of the city. We need to build public utilities, which will cost about $6 million. To fund this large project, we're using multiple sources to reduce the city's financial burden. The EPA has already spent $2 million on demolition, which helped a lot. We've applied for a $3.5 million grant from READI 2.0, which is tentatively approved. The city must match this amount, and the RIF loan will count towards that match. We're using various programs to fund this project, not just relying on River West TIF. Resolution No. 3637 allows us to issue bonds up to $2.57 million to cover project costs. These bonds will be paid back with tax increment from the River West Development area and authorize the city to enter into a financial assistance agreement with the IFA. Resolution No. 3838 allocates the bond sale proceeds to fund the project costs, including related expenses and the cost of issuing the bonds. If the RDC approves both resolutions today, RDC staff will present a resolution to the Common Council on May 12th to approve the CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING – April 24, 2025 5 issuance of TIF revenue bonds. This would be the final public step needed. Mr. Molnar also noted the Public Hearing will follow. Vice President Relos asked about when the IEDC Board approval would happen for the grant. Caleb Bauer, Executive Director of Community Investment, stated possibly this summer. Commissioner Gooden-Rodgers inquired about the likelihood of us receiving the grant. Mr. Bauer stated that we don't have an exact date for the approval from the IEDC board for the grant, but the Ready 2.0 blight and redevelopment funds are administered by the state of Indiana and IEDC. These funds come from the Lilly Endowment. The statewide READI 2.0 blite program has $500 million, and an additional $250 million was contributed to other state-run programs by Lilly Endowment. This means the funds are not dependent on the state budget. Although the IEDC board still needs to sign off, we are confident we will get the contract. We're just sharing that it hasn't been signed yet, but we're working towards that. Secretary Wax asked, “Do you have an estimate of how much additional funding is needed to get the project ready for development”? Mr. Molnar stated that we don't have a specific number right now, but we estimated $6 million for public utilities. With $3.5 million from the grant and $2.5 million from the loan, we're close to that amount but not quite there. Sarah Schaefer, Deputy Director of Community Investment, stated we're not aware of any other major expenses needed to prepare the project, though it's early stages and costs can increase. We believe $6 million should cover most of what we need, but we'll monitor any additional funding requirements. Commissioner Shaw inquired about the $3.5 million from the Lilly Endowment for READI 2.0, does it have the same matching requirements as the rest of READI 2.0? Is it true that this loan can serve as a match? Are there other private investment requirements we need to meet to unlock these additional funds? Mr. Bauer explained yes, our submission included the capital stack for the development site, using two nonprofit developers: South Bend Heritage and Intend Indiana. However, until we have signed contracts and development agreements, these details aren't finalized. We're still negotiating, but we aim to secure the loan quickly. The IFA is eager to move forward, and we feel confident about closing the loan and continuing negotiations while signing the contract with the IEDC. We have agreements coming before the Commission that will solidify all private investments related to this site. Matt Barrett asked where the remaining $1 million will come from and will we satisfy the 6-month term from the bond agreement. Caleb CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING – April 24, 2025 6 Bauer stated that, we plan to cover the remaining matches through a new allocation area, either via financing or future increment generated by the project. We're already designing the infrastructure and plan to proceed with the demolition of the Elwood Shopping Plaza, which is included in the IFA loan scope. The bid specifications are being prepared, and we're on track to meet our contractual requirements with the IFA for commencement. Demolition will count as the start of work for the 6-month term. President Warner spoke in favor of the project. The motion was made by Eli Wax to approve, second by David Relos. On the motion: • Troy Warner, President: Yes • David Relos, Vice President: Yes • Eli Wax, Secretary: Yes • Gillian Shaw, Commissioner: Yes • Ophelia Gooden-Rodgers, Commissioner: Yes The motion carried; the Commission approved Resolution No. 3637 as presented on April 24, 2025. 3. Public Hearing Concerning the Appropriation of Proceeds of the Tax Increment Revenue Bond A notice was published in the South Bend Tribune on April 11, 2025, regarding the public hearing concerning appropriation of proceeds of the redevelopment district of the City of South Bend, Indiana tax increment revenue bonds A Public Hearing regarding the Appropriation of Proceeds of the Tax Increment Revenue Bond was opened to the public for comments and considerations. No comments were made from the public. The Public Hearing was closed. 4. Resolution No. 3638 (Appropriating the Proceeds of Tax Increment Revenue Bonds for Drewry’s/Portage Elwood) The motion was made by Troy Warner to approve, second by David Relos. On the motion: • Troy Warner, President: Yes • David Relos, Vice President: Yes • Eli Wax, Secretary: Yes • Gillian Shaw, Commissioner: Yes • Ophelia Gooden-Rodgers, Commissioner: Yes CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING – April 24, 2025 7 The motion carried; the Commission approved Resolution No. 3638 as presented on April 24, 2025. B. River East Development Area 1. Disposition Process Overview Joseph Molnar, Assistant Director of Growth and Opportunity, presented an overview of the disposition process under Indiana Code 36-7-14. He detailed steps 1-8 and explained all common terms. 2. Bid Specifications for Disposition of Property (403 E Madison) Joseph Molnar, Assistant Director of Growth and Opportunity, presented agenda items 5.B. 2-4 together. In November, 2024, the purchase agreement for the property at 403 E. Madison, approximately 3.39 acres, was finalized. The building has three floors above ground totaling 60,000 square feet, and a partial basement of about 10,000 square feet. The East Bank Learning Center, a childcare center for children aged six months to about five years, is an active tenant with a lease. The minimum bid for the property is $1,494,000, based on the average of two appraisals. Bids are due by May 22nd at 9:00 AM, with a meeting at 9:30 AM to open the bids for the Redevelopment Commission. Bid specifications emphasize compatibility with the surrounding neighborhood and the River East development plan, as the property is in the River East TIF. Approval is needed today by the Redevelopment Commission for the bid specification, notice of intended disposition of property, and Resolution No. 3635 for the property's disposition. Secretary Wax asked how much we paid for the building and whether we have made any improvements. Mr. Molnar stated that we paid $300,000 and have not made any improvements. Commissioner Ellison asked about the lease for the childcare facility and Mr. Molnar confirmed that the childcare center has a lease for three or four years, with an annual opt-out clause. If either party wishes to terminate the lease, they must provide 12 months' notice to the other party. Currently, RDC staff recommends to the Commission not to end the lease. Matt Barrett asked if there are any plans to market the property beyond the City's website and newspaper. Caleb Bauer stated that we always follow the Indiana Code process, and if there are no inquiries from the initial process, they can then explore further marketing options. Historically, the Commission has followed the disposition process first. Once that concludes, the Commission may issue an RFP. RFP is more CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING – April 24, 2025 8 actively marketed as it seeks specific types of investment in the property, whereas the disposition process is more open-ended. The motion was made by Eli Wax to approve, second by David Relos. On the motion: • Troy Warner, President: Yes • David Relos, Vice President: Yes • Eli Wax, Secretary: Yes • Gillian Shaw, Commissioner: Yes • Ophelia Gooden-Rodgers, Commissioner: Yes The motion carried; the Commission approved the Bid Specifications as presented on April 24, 2025. 3. Notice of Intended Disposition of Property (403 E Madison) The motion was made by Eli Wax to approve, second by Troy Warner. On the motion: • Troy Warner, President: Yes • David Relos, Vice President: Yes • Eli Wax, Secretary: Yes • Gillian Shaw, Commissioner: Yes • Ophelia Gooden-Rodgers, Commissioner: Yes The motion carried; the Commission approved the Notice as presented on April 24, 2025. 4. Resolution No. 3635 for Disposition of Property (403 E Madison) The motion was made by Eli Wax to approve, second by David Relos. On the motion: • Troy Warner, President: Yes • David Relos, Vice President: Yes • Eli Wax, Secretary: Yes • Gillian Shaw, Commissioner: Yes • Ophelia Gooden-Rodgers, Commissioner: Yes The motion carried; the Commission approved Resolution No. 3635 as presented on April 24, 2025. 5. Bid Specifications for Disposition of Property (1201 Northside) CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING – April 24, 2025 9 Joseph Molnar, Assistant Director of Growth and Opportunity, presented agenda items 5.B.5-7 together. In April 2024, the Redevelopment Commission and the YMCA of Greater Michiana entered into a donation agreement, transferring the property to the Commission while simultaneously signing a lease for the YMCA at the Downtown Leighton location. The property, located at 1201 Northside, consists of seven parcels totaling just under 6 acres. All existing structures have been demolished except for one pavilion, which is being cleared. The average of two appraisals for this property was $576,500, setting the minimum bid at this amount. Bids are due by May 22nd at 9:00 AM, with the RDC meeting immediately following to open the bids. Bid specifications emphasize compatibility with the surrounding neighborhood, including the farmers market location, adjacent established neighborhood, and the River East Development plan, as the property is in the River East TIF. Approval is needed today by the Commission for the bid specifications, notice of intended disposition, and Resolution 3636 for the property's disposition. Commissioner Shaw asked if Mr. Molnar could provide an example on what compatibility of the surrounding neighborhood means or what an example would look like. Mr. Molnar explained that the bid specifications emphasize compatibility. This means ensuring any new roads connect to the existing street grid and considering the property's proximity to the Riverwalk. We want proposed uses to be compatible with the Riverwalk, so a self-storage facility, for example, would not be suitable. Additionally, the property is next to an established neighborhood, so we want to avoid uses that could harm the neighborhood. The motion was made by Eli Wax to approve, second by Ophelia Gooden-Rodgers. On the motion: • Troy Warner, President: Yes • David Relos, Vice President: Yes • Eli Wax, Secretary: Yes • Gillian Shaw, Commissioner: Yes • Ophelia Gooden-Rodgers, Commissioner: Yes The motion carried; the Commission approved the Bid Specifications as presented on April 24, 2025. 6. Notice of Intended Disposition of Property (1201 Northside) CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING – April 24, 2025 10 The motion was made by Eli Wax to approve, second by Troy Warner. On the motion: • Troy Warner, President: Yes • David Relos, Vice President: Yes • Eli Wax, Secretary: Yes • Gillian Shaw, Commissioner: Yes • Ophelia Gooden-Rodgers, Commissioner: Yes The motion carried; the Commission approved the Notice as presented on April 24, 2025. 7. Resolution No. 3636 for Disposition of Property (1201 Northside) The motion was made by Eli Wax to approve, second by David Relos. On the motion: • Troy Warner, President: Yes • David Relos, Vice President: Yes • Eli Wax, Secretary: Yes • Gillian Shaw, Commissioner: Yes • Ophelia Gooden-Rodgers, Commissioner: Yes The motion carried; the Commission approved Resolution No. 3636 as presented on April 24, 2025. 6. Progress Reports A. Tax Abatement None B. Common Council None C. Other None CITY OF SOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING – April 24, 2025 11 7.Next Commission Meeting Thursday, May 8, 2025, 9:30 a.m. Council Chambers on the 4th Floor. 8.Adjournment Thursday, April 24, 2025, 10:27 a.m. ______________________________ ______________________________ Eli Wax, Secretary Troy Warner, President