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HomeMy WebLinkAbout2008-12-03 Redevelopment Authority MinutesSOUTH BEND REDEVELOPMENT AUTHORITY REGULAR MEETING December 3, 2008 1:30 p.m. Presiding: Jose Alvarez 1308 County-City Building 227 West Jefferson Boulevard South Bend, IN 46601 The December 3, 2008 Regular Meeting of the Redevelopment Authority was called to order at 1:30 p.m. by its President, Jose Alvarez. There was a quorum present. 1. -ROLL CALL Members Present: Mr. Jose Alvarez, President Ms. Carolyn V. Pfotenhauer, Vice President Mr. Ray Thomas, Secretary Redevelopment Staff: Mr. Don Inks, Director of Economic Development Mrs. Jenny Hullinger, Recording Secretary Ms. Cheryl Greene, Legal Counsel Others: Mr. Rich Hill, Baker & Daniels Mr. Randy Rompola, Baker & Daniels 2. APPROVAL OF MINUTES a. Approval of the minutes of November 19, 2008 Upon a motion. by Carolyn Pfotenhauer, seconded by Jose Alvarez, and unanimously carried, the Authority approved the Minutes of the Regular Meeting of November 19, 2008. 3. CLAIMS a. Baker & Daniels Century Center Bond $123,155.10 Mr. Inks said the total claim was over $136,000 and Baker and Daniels gave us a 10% discount to bring the amount down to $123,155.10. This is above and beyond the letter we had brought to the Authority at the last meeting, which indicated that the amount would not be more than $110,000. Almost immediately after the last meeting Don- received a call from Randy Rompola wanting to correct the letter because they had since totaled up their hours and they were in excess of the amount stated in their letter. They then delivered the letter and billing you have. Ms. Greene said the legal department reviewed the entries. She. said this was an unusual transaction with an initial start of TIF related funding which then changed to different financing. We then had a change in State law and issues related to the County and the financial market. All of the entries are consistent with all of the issues. Ms. Greene said the. legal department recommends approval of the claim. The Redevelopment Authority December 3, 2008 Meeting Minutes Upon a motion by Ms. Pfotenhauer, seconded by Mr. Alvarez, the Authority , approved the claim, as presented. Mr. Hill said he has never seen a situation like this one. in the more than twenty years of his practice. He said if it had been another situation he might have recommended stopping the process. He was hearing from the Board of Managers of Century Center that if the bond was not sold there would be health and safety issues as well as a loss of bookings. The work needed to be done. Some of the problems that slowed the sale were bond insurers were down rated and the rating agencies then took an entirely different approach. The kinds of information the rating agencies were requesting was different from anything in the past. There was a change in the structure of the financing because there was not enough TIF money to use, and then there were questions on the scope of the financing from the Hotel/Motel Tax Board. Baker & Daniels spent considerably more time than anticipated on those issues. At certain times there was no bond market. There were two considerations, one, that there was sufficient interest in bonds, and two, the interest rate for bonds had to be reasonable. They were very happy that the bond sold. and closed, it was one of the few that did. The work on the bond actually took 400 hours over 7 months to complete. In May they had assumed it would have been a quick transaction. Mr. Rompola said if you looked at where we were in May, and if the State had not held up the process because of TIF issues and property tax issues, the bond would probably have sold before the summer with or without the TIF. It was the summer when everything fell apart: the market, the rating agencies and the change in interest rates. Baker and Daniels spent a lot of time in the. summer working on the financing. Mr. Rompola said all of the time that was spent on the bond was not in their accounting system when he provided the memo on the costs for the last Authority meeting. There was more time spent before closing dealing with some of the County issues. Mr. Hill said the day of closing was the drop dead date for ordering some of the equipment that was needed for the 2009 construction schedule. Ms. Pfotenhauer said she reviewed the bill and saw that it was reasonable. She was concerned that if we work with Baker and Daniels in the future that both sides make a concerted effort to communicate more and an effort to really control the costs, and that the estimates that we are given are as up-to-date as humanly possible. Mr. Hill said he agreed and said in the future he would have more communication with the Authority. 2 H:\WPDATA\AUTHORTY\12032008.MIN.DOC The Redevelopment Authority December 3, 2008 Meeting Minutes 4. NEXT MEETING DATE: December 17, 2008 5. ADJOURNMENT There being no further business to come before the Redevelopment Authority the meeting was adjourned at 1:40 p.m. ~._--- ~~ e Alvarez, President ~~ / Donald Inks, Director H:\W PDATAW UTHORTY~12032008.MIN.DOC