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Home My WebLink About01-16-14 Redevelopment Commission MinutesSOUTH BEND REDEVELOPMENT COMMISSION REGULAR MEETING January 16, 2014 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. Don Inks, Secretary Mr. Greg Downes Ms. Valerie Schey Mr. Stan Wruble Legal Counsel: Mr. Lawrence Meteiver, Esq. Redevelopment Staff: Mr. David Relos, Economic Development Specialist Mrs. Cheryl Phipps, Recording Secretary Mr. Jitin Kain, Director of Planning Ms. Debrah Jennings, Property Manager Others Present: 2. APPROVAL OF MINUTES Mr. Scott Ford, Executive Director Mr. Ed Bradley, Newmark Grubb Mr. Conrad Damian Mr. Cecil Eastman, Admin & Finance Mr. Erin Blasko, South Bend Tribune A. Approval of Minutes of the Regular Meeting of Thursday, December 12, 2013. Upon a motion by Mr. Inks, seconded by Mr. Downes and unanimously carried, the Commission approved the Minutes of the Regular Meeting of Thursday, December 12, 2013. B. Approval of Minutes of the Annual Organizational Meeting of Thursday, January 2, 2014. Upon a motion by Mr. Inks, seconded by Mr. Downes and unanimously carried, the Commission approved the Minutes of the Annual Organizational Meeting of Thursday, January 2, 2014. ,South Bend Redevelopment Commission Regular Meeting — January 16, 2014 3. APPROVAL OF CLAIMS Redevelopment Commission Claims submitted Jan 16, 2014 for approval 324 AIRPORT AREA Sopko, Nussbaum, Inabnit & Kaczmarek Faegre Baker Daniels Cressy & Everett Management Corp. Crowe Horwath Plews Shadley Racher & Braun LLP South Bend Water Works 4,637.50 Legal Services 783.7 Legal Services 14,169.92 Property Mgmt Services at Bosch 7,443.50 Neutralization Calculations 11,439.12 ARG Corporation Litigation/Bosch/ Hull & Associates Inc. Honeywell/Union Station 96.35 4224 Fellows St / 4212 Fellows St Weaver Boos Consultants 18,730.68 Ivy Tower Facility Redevelopment IDEM 86.39 Services Provided Hull & Associates Inc. 12,800.00 Additional Assessment & Remediation Jones Petrie Rafinski 1,500.00 Asbestos Containing Materials Surveys South Bend Parks & Recreation 2,657.14 Snow Removal 420 FUND TIF DISTRICT -SBCDA GENERAL Sopko, Nussbaum, Inabnit & 2,125.00 Kaczmarek Crowe Horwath 1,927.99 DTSB 22,500.00 Kil Architecture Planning 2,132.50 Faegre Baker Daniels 6,604.00 Majority Builders 15,335.58 Rose Pest Solutions 105.00 South Bend Water Works 238.50 South Bend Parks & Recreation 2,657.14 Legal Description for Riverside District / Legal Services Neutralization Calculations Beautification Program River Glenn Campus Study Legal Services Studebaker Plaza - Citizen's Bank & Trust LaSalle Hotel 325 S Lafayette Blvd / 410 W Wayne Snow Removal 422 TIF DISTRICT WEST WASHINGTON Crowe Horwath 319.29 Neutralization Calculations 426 FUND SOUTH BEND CENTRAL MEDICAL DISTRICT Reith -Riley Construction 166,772.34 Memorial Parking Phase 3B Crowe Horwath 1,071.73 Neutralization Calculations DLZ 1,380.00 Building Demolition Services 429 FUND NORTHEAST DISTRICT Crowe Horwath 616.58 Neutralization Calculations 2 South Bend Redevelopment Commission Regular Meeting — January 16, 2014 3. APPROVAL OF CLAIMS (CONT.) 430 FUND SOUTH SIDE DEVELOPMENT TIF AREA #1 DLZ 13,281.76 Bowen St. Sidewalk RW / Fellows St Weaver Boos Consultants 11,262.75 Environmental Site Characterization - Main St. & Lafayette Blvd. Christoper B. Burke Engineering 20,480.75 Fellows & Ireland Rd Intersection Improvements Lawson - Fisher Associates, P.C. 22,786.76 Main to Lafayette Blvd Connector Cardno JFNew 3,320.00 Fellows St Crowe Horwath 1,309.64 Neutralization Calculations Meridian Title Corporation 300.00 Title Search 432 TIF SSDA #3 - ERSKINE VILLAGE Crowe Horwath 656.03 Neutralization Calculations 433 REDEVEMENT ADMINISTRATION GERERAL Faegre Baker Daniels 6,072.40 Legal Services 435 TIF DOUGLAS ROAD Crowe Horwath 656.03 Neutralization Calculations 436 TIF NORTHEST RESIDENTIAL Kite Realty Group 214,573.09 ROW in Eddy St. Commons Total 378,256.07 Upon a motion by Mr. Downes, seconded by Ms. Schey and unanimously carried, the Commission approved the Claims submitted January 16, 2014. 4. COMMUNICATIONS There were no Communications. 5. OLD BUSINESS There was no Old Business. 6. NEW BUSINESS A. South Bend Central Development Area (1) Notice of Renewal Agreement with Bradley Company, LLC for management of the Michigan Street Shops. 3 South Bend Redevelopment Commission Regular Meeting —January 16, 2014 6. NEW BUSINESS (CONT.) A. South Bend Central Development Area (1) continued... Ms. Jennings noted that Bradley Company currently manages the Redevelopment Retail properties known as the Michigan Street Shops. It has maintained a 100% lease rate for over a year and has collected 90% to 95% of rent. Staff recommends renewing the management agreement with Bradley Co. for an additional year, ending January 31, 2015. Upon a motion by Ms. Schey, seconded by Mr. Downes and unanimously carried, the Commission authorized sending the Notice of Renewal Agreement with Bradley Company LLC for management of the Michigan Street Shops. (2) Second Amendment to Lease with J Weldy, LLC dba Bruno's Pizza. Ms. Jennings noted that the lease to Bruno's Pizza in the Michigan Street Shops expired November 30, 2013. The term of the Second Amendment to Lease is from December 1, 2013 to November 30, 2016 and has the following rent structure: December 2013 — November 2014, $16,800 annually December 2014 — November 2015, $18,144 annually December 2015 — November 2016, $19,595 annually The rent structure is consistent with the franchise lease rates. Bruno's Pizza has been an excellent tenant with a history of consistent, on -time and paid -in -full lease payments. Staff recommends approval. Upon a motion by Ms. Schey, seconded by Mr. Downes and unanimously carried, the Commission approved the Second Amendment to Lease with J Weldy, LLC dba Bruno's Pizza (3) Proposal for Phase I Environmental Assessment for the Hill and Colfax development site. Mr. Kain noted that on December 9, 2013 the Commission approved a purchase agreement to sell the parcel at NW Hill and Colfax to Colfax Hill Partners, LLC. As part of the purchase agreement, the Commission committed to providing a new Phase 1 Site Assessment. Staff solicited a proposal from Jones Petrie Rafinski. Their fee is $1,700, to be paid from the SBCDA TIF. Staff recommends approval. Upon a motion by Mr. Varner, seconded by Mr. Downes and unanimously carried, the Commission approved the Agreement for Professional Services by and between the City of South Bend, Indiana and Jones Petrie Rafinski for the scope of services and fee proposed. South Bend Redevelopment Commission Regular Meeting — January 16, 2014 6. NEW BUSINESS (CONT.) A. South Bend Central Development Area (4) Resolution No. 3194 approving the fair market value of property in the South Bend Central Development Area. (332 W. Jefferson St.) Ms. Jennings noted that 332 W. Jefferson, 1503 -1505 Prairie, and 118 -124 William are Commission owned properties that have not yet been through the disposition process. The process includes setting the fair market value by resolution. Bid specifications are established for each property, indicating any minimum requirements for development, and advertising the disposition with receipt of bids, in these cases February 13, 2014 at 9:00 a.m. Resolution No. 3194 sets the disposition offering price for the 34 ft. x 198 ft. lot at $18,500, the average of two independent appraisals. Upon a motion by Ms. Shey, seconded by Mr. Downes and unanimously carried, the Commission approved Resolution No. 3194 approving the fair market value of property in the South Bend Central Development Area. (332 W. Jefferson St.) (5) Bid Specifications and Design Considerations for property in the South Bend Central Development Area. (332 W. Jefferson St.) Ms. Jennings noted that the Bid Specifications & Design Considerations for this property include that bids must meet the minimum offering price, must conform to the CBD zoning designation and that proposals for reuse must include a basic reuse plan and project timeline. During the review process, emphasis will be placed on compatibility with the goals and objectives of the surrounding neighborhood as well as the Development Plan for the South Bend Central Development Area. Bidders are prohibited from using the property for speculation or land - holding purposes. Upon a motion by Mr. Downes, seconded by Mr. Inks and unanimously carried the Commission approved the Bid Specifications and Design Considerations for property in the South Bend Central Development Area. (332 W. Jefferson St.) (6) Authorization to publish the Notice of Intended Disposition of Property with publication dates of January 24, 2014 and January 31, 2014 and Receipt of Bids at 9:00 a.m. on February 13, 2014. (332 W. Jefferson St.) Upon a motion by Ms. Schey, seconded by Mr. Downes and unanimously carried, the Commission authorized publication of the Notice of Intended Disposition of Property with publication dates of January 24, 2014 and January 31, 2014 and Receipt of Bids at 9:00 a.m. on February 13, 2014. (332 W. Jefferson St.) 5 South Bend Redevelopment Commission Regular Meeting — January 16, 2014 6. NEW BUSINESS (CONT.) A. South Bend Central Development Area (7) Resolution No. 3195 approving the fair market value of property in the Airport Economic Development Area. (1503 -1505 Prairie Ave.) Resolution No. 3195 sets the disposition offering price for the 101,039 sq. ft. lot (2.32 acres) at $63,500, the average of two independent appraisals. Upon a motion by Ms. Shey, seconded by Mr. Downes and unanimously carried, the Commission approved Resolution No. 3195 approving the fair market value of property in the Airport Economic Development Area. (1503 -1505 Prairie Ave.) (8) Bid Specifications and Design Considerations for property in the South Bend Central Development Area. (1503 -1505 Prairie Ave.) Ms. Jennings noted that the Bid Specifications & Design Considerations for this property include that bids must meet the minimum offering price, must conform to the Light Industrial zoning designation and that proposals for reuse must include a basic reuse plan and project timeline. During the review process, emphasis will be placed on compatibility with the goals and objectives of the surrounding neighborhood as well as the Development Plan for the Airport Economic Development Area. Bidders are prohibited from using the property for speculation or land- holding purposes. Upon a motion by Mr. Downes, seconded by Mr. Inks and unanimously carried the Commission approved the Bid Specifications and Design Considerations for property in the Airport Economic Development Area. (1503 -1505 Prairie Ave.) (9) Authorization to publish the Notice of Intended Disposition of Property with publication dates of January 24, 2014 and January 31, 2014 and Receipt of Bids at 9:00 a.m. on February 13, 2014. (1503 -1505 Prairie Ave.) Upon a motion by Ms. Schey, seconded by Mr. Downes and unanimously carried, the Commission authorized publication of the Notice of Intended Disposition of Property with publication dates of January 24, 2014 and January 31, 2014 and Receipt of Bids at 9:00 a.m. on February 13, 2014. (1503 -1505 Prairie Ave.) (10) Resolution No. 3196 approving the fair market value of property in the South Bend Central Development Area. (118 -124 William St.) Resolution No. 3196 sets the disposition offering price for the vacant 12,243 sq ft lot at $28,000, the average of two independent appraisals. 0 South Bend Redevelopment Commission Regular Meeting — January 16, 2014 6. NEW BUSINESS (CONT.) A. South Bend Central Development Area (10) continued... Upon a motion by Ms. Shey, seconded by Mr. Downes and unanimously carried, the Commission approved Resolution No. 3195 approving the fair market value of property in the South Bend Central Development Area. (118 -124 William St.) (11) Bid Specifications and Design Considerations for property in the South Bend Central Development Area. (118 -124 William St.) Ms. Jennings noted that the Bid Specifications & Design Considerations for this property include that bids must meet the minimum offering price, must conform to the CBD zoning designation and that proposals for reuse must include a basic reuse plan and project timeline. During the review process, emphasis will be placed on compatibility with the goals and objectives of the surrounding neighborhood as well as the Development Plan for the South Bend Central Development Area. Bidders are prohibited from using the property for speculation or land - holding purposes. Upon a motion by Mr. Downes, seconded by Mr. Inks and unanimously carried the Commission approved the Bid Specifications and Design Considerations for property in the South Bend Central Development Area. (118 -124 William St.) (12) Authorization to publish the Notice of Intended Disposition of Property with publication dates of January 24, 2014 and January 31, 2014 and Receipt of Bids at 9:00 a.m. on February 13, 2014. (118 -124 William St.) Upon a motion by Ms. Schey, seconded by Mr. Downes and unanimously carried, the Commission approved the Bid Specifications and Design Considerations for property in the South Bend Central Development Area (118 -124 William St.) B. Airport Economic Development Area (1) Resolution No. 3198 approving $4,000,000 of Qualified Zone Academy Bonds (Direct Pay), Series 2011 and 2013 (South Bend Career Academy, Inc.) for purposes of Section 147(f) of the Internal Revenue Code of 1986. Mr. Meteiver noted that the South Bend Career Academy is seeking the issuance of $4,000,000 in Qualified Zone Academy Bonds for the Academy. These are tax credit bonds, and in no way the obligation of the City or the Issuer. The Issuer of the Bonds will be the Public Finance Authority, a Wisconsin issuer that is authorized to issue bonds nationwide. One of the requirements for the issuance of the bonds is that a public hearing be held in the local jurisdiction where the project is located. Notice was published in the South Bend Tribune for a meeting that was held Monday, December 30, 2013 at 10 am. The 7 South Bend Redevelopment Commission Regular Meeting — January 16, 2014 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (1) continued... public hearing was convened by David Relos at the appointed time and place. No one appeared. The meeting was adjourned. The South Bend Career Academy project was previously approved by the Commission. The Academy is now asking for the Commission's approval of this bond issuance financing. Staff recommends approval. No funds are being committed by the Commission. It is simply certifying that the project the bonds would finance is acceptable to the local jurisdiction. Ms. Schey asked if this item will also come before the Common Council. Mr. Meteiver responded that it would not. Mr. Varner noted that the Commission provided some startup funds for the Career Academy, which may be the reason for the Commission's involvement at this time. Upon a motion by the Commission approved Resolution No. 3198 approving $4,000,000 of Qualified Zone Academy Bonds (Direct Pay), Series 2011 and 2013 (South Bend Career Academy, Inc.) for purposes of Section 147(f) of the Internal Revenue Code of 1986. (2) Ratification of Certificate of Completion for James and Sandra McCune (225 W. Garst) Mr. Relos noted that in 2004 the Commission sold this property to Mr. McCune and relocated his business to this location. There is always a development agreement for any property the Commission sells spelling out any obligations the purchaser has. Mr. McCune has met all of the obligations of the development agreement. This Certificate of completion should have been issued many years ago, but has just come to our attention now that it was not. Mr. Relos signed the document prior to the meeting to meet the needs of the McCunes and that action now needs to be ratified. Staff recommends approval. Upon a motion by Mr. Downes, seconded by Mr. Varner and unanimously carried, the Commission ratified the Certificate of Completion for James and Sandra McCune (225 W. Garst) (3) Ratification of Post - Closing Undertaking related to Curtis Products, Inc. purchase of former Bosch facility. Mr. Relos noted that we have now closed with Curtis Products on the purchase of the Bosch facility. In doing the survey of the property it came to light that there was the stub of an alley surrounded on all sides by Bosch property. Curtis Products wants that alley stub South Bend Redevelopment Commission Regular Meeting — January 16, 2014 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (3) continued... vacated. This document says that the Commission will support that effort. Mr. Relos signed the document at closing, so ratification is needed now. Upon a motion by Ms. Schey, seconded by Mr. Downes and unanimously carried, the Commission ratified the Post - Closing Undertaking related to the Curtis Products, Inc. purchase of the former Bosch facility. (4) Staff report on negotiations with EMU Solutions, Inc. Mr. Relos noted that Emu Solutions is a high tech computer hardware /software company born from Intellectual Property being licensed out of Innovation Park. Emu Solutions, Inc. develops hardware and software technologies used for Big Data analytics. The company's patented technologies eliminate the bottleneck that occurs when data flows between a computer's processor and its memory. This problem, referred to as the "memory wall," is particularly important when working with Big Data users. Emu's founders, including Peter Kogge, PhD., Jay Brockman, Phd., and Ed Upchurch, PhD., have more than 75 years of combined experience in both industry and academia in numerous areas related to high end computing. Dr. Kogge, developer of the space shuttle I/) processor, the world's first multicore processor, and a number of other important innovations, was named the recipient of the prestigious IEEE Computer Society's 2012 Seymour Cray Computer Engineering Award. Emu Solutions has submitted a Petition for Incentives through 2017 pledging to create 25 new jobs with hourly wages ranging from $20 to $70 per hour for technical staff, $20 to $75 per hour for managerial staff and $15 to $30 for administrative staff. In addition, Emu Solutions commits to investing $3,978,000 in South Bend for space and equipment to establish a headquarters here. Staff has been in negotiations with Emu leadership and is requesting permission to move forward with the preparation of a development agreement committing $500,000 of AEDA TIF funding to purchase two servers to be leased back to Emu for a nominal fee after disposition procedures are completed. The Commission would retain ownership of the equipment through the three year lease period, and upon proof of satisfying total investment and job creation projections shall sell the equipment to the company for the sum of $I. It is anticipated that standard clawback provisions will be built into the development agreement that would require cash penalties in the event either commitment should fall short of promises. Upon approval by the Commission today, a development agreement will be drafted by the city's Legal department and brought back for approval by the Commission in February. X South Bend Redevelopment Commission Regular Meeting — January 16, 2014 6. NEW BUSINESS (CONT.) B. Airport Economic Development Area (4) continued... Mr. Varner noted that the precedence for this incentive was established a few years ago with F Cubed. Speculative projects like this have the potential for big reward or big failure. He would like the Commission in the future to try to secure an equity position for its investment in the project. He asked the staff to research how that could be possible. We are missing an opportunity if we don't look for a way. Lawyers can find a way when they want to. Mr. Downes agreed and noted that Notre Dame is doing that at Innovation Park. We should certainly look into the possibility. Mr. Downes asked if Emu Solutions is expected to move to a multi- tenant building in Ignition Park when one is built. Mr. Ford responded that they are expected to be a tenant in one of the multi -tenant buildings, or locate somewhere in the Airport Economic Development Area. Upon a motion by Ms. Schey, seconded by Mr. Downes and unanimously carried, the Commission authorized staff to prepare a development agreement including an incentive that the Commission would purchase equipment for the project from AEDA TIF funds. The actual development agreement will be brought back to the Commission for approval at a later date. C. West Washington - Chapin Development Area D. South Side Development Area E. Northeast Neighborhood Development Area F. Douglas Road Development Area G. Other (1) Filing of Resolution No. 3197 appropriating monies from the Redevelopment General Fund (Fund 433) for the purpose of paying for certain expenses incurred by the Redevelopment Commission and setting a public hearing on Resolution No. 3197 for 9:30 a.m., February 13, 2014. Upon a motion by Ms. Schey, seconded by Mr. Downes and unanimously carried, the Commission accepted for filing Resolution No. 3197 appropriating monies from the Redevelopment General Fund (Fund 433) for the purpose of paying for certain expenses] 10 South Bend Redevelopment Commission Regular Meeting — January 16, 2014 6. NEW BUSINESS (CONT.) G. Other (1) continued... incurred by the Redevelopment Commission and setting a public hearing on Resolution No. 3197 for 9:30 a.m., February 13, 2014. 7. PROGRESS REPORTS There were no Progress Reports 8. NEXT COMMISSION MEETING The Next Regular Meeting of the Redevelopment Commission is scheduled for 9:30 a.m., January 30, 2014. 9. ADJOURNMENT There being no further business to come before the Redevelopment Commission, Mr. Varner made a motion that the meeting be adjourned. Mr. Inks seconded. The meeting was adjourned at 9:54 a.m. ScotArC. Ford, Executive—Director 11