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01/12/2016 - Minutes MINUTES OF THE 765th MEETING OF THE BOARD OF DIRECTORS OF THE REDEVELOPMENT AGENCY OF SALT LAKE CITY Tuesday, January 12, 2016 451 South State Street, Room 326 Salt Lake City, Utah 2:00 pm 1. 2:09:46 PM Roll Call. The following members of the Board of Directors of the Redevelopment Agency of Salt Lake City were present: Lisa Adams, Chairperson Derek Kitchen, Vice-Chairperson Stan Penfold, Director Andrew Johnston, Director Charlie Luke, Director James Rogers, Director Erin Mendenhall, Director Also Present: Jackie Biskupski, Chief of Staff D.J. Baxter, Executive Director Others Attending: Justin Belliveau, Deputy Director Ed Butterfield, Senior Project Manager Jill Wilkerson-Smith, Project Manager Kort Utley, Project Manager Ben Davis, Project Manager David Arteaga, Project Coordinator Cara Lindsley, Project Coordinator Tammy Hunsaker, Project Coordinator Amanda Holty, Marketing and Communications Coordinator Damon Georgelas,Agency Legal Counsel Crayola Berger, Accountant II Jolynn Walz, Office Manager Kalli Ruiz, Office Facilitator Jason Birmingham, Lewis Young Robertson & Birmingham, Inc. Micah Peters, Clearwater Homes Kyle Jardine, PEG Development David and Kevin Phipps, 10 Cliff, LLC. RDA Board Meeting Minutes Tuesday,January 12,2016 Page 2 Ashley Patterson, Wasatch Portable Garden Camille Winnie, Downtown Alliance 2. 2:10:46 PM Briefing by the Staff Outgoing Chairperson and Vice-Chairperson Gifts were given to Stan Penfold and Lisa Adams, thanking them for their years of service as the Redevelopment Agency Chair and Vice-Chair. RDA Goals Executive Director Baxter said that a copy of the RDA General goals has been provided to each of the Board members. He explained that due to the change in the budget process the Board has not seen general goals for a couple years and inquired if this is something the Board would like to review the overall budget process. Executive Director Baxter asked Board members to think about it and as Spring approaches to let Staff know if this is a feature you would like to include in the upcoming budget process. Eccles Theater Subcommittee Executive Director Baxter explained that the Eccles Theater Subcommittee consists of Lisa Adams, Stan Penfold, and Kyle LaMalfa. Due to Director LaMalfa's departure, another member is needed. Chairperson Penfold asked whether any Board Members would like to serve on the Eccles Theater Subcommittee. Director Kitchen volunteered to serve. RDA Annual Report Executive Director Baxter stated that copies the RDA 2014 Annual Report have been provided to the Board Members. Central Ninth Neighborhood Update Mr. Utley explained that in the Fall 2015 two RFPs were released for properties located in the Central Ninth neighborhood. Six proposals were received and the selection committee reviewed and selected LandForge as the developer. The selection committee felt their proposal met the strategic development goals and objectives identified by the Board for the Central Ninth Neighborhood. LandForge is proposing to develop 23 market rate condominiums and 4,300 square feet of commercial space. The Agency will enter into an exclusive negotiation period with the Developer and will return in April for the Board's consideration on the terms for the purchase agreement and schedule. Mr. Utley presented a map of the Central Ninth Neighborhood outlining the location of the LandForge development along with other RDA owned properties and projects underway in the RDA Board Meeting Minutes Tuesday,January 12,2016 Page 3 area. 3. 2:20:11 PM Approval of the Minutes from the Meeting held December 08, 2015. Director Mendenhall made a motion to approve the minutes from the meeting held December 8, 2015. Vice-Chairperson Adams seconded the motion. Upon roll call, Chairperson Penfold declared the motion unanimously approved. View Minutes 4. 2:20:26 PM Report of the Chief Administrative Officer. Chief Administrative Officer Biskupski thanked the RDA Board for welcoming her and being receptive to her desire to be more involved in the RDA meetings. She stated she is excited and looks forward to working with the RDA, in hopes to utilize the resources the Agency can provide to help meet the infrastructure needs and economic development goals for the City. 5. 2:23:19 PM Public Comments. Mr. George Chapman expressed his concerned for the homeless population throughout the City. He stated he felt more needed to be done to get homeless individuals off the sidewalks and thought more of the RDA properties should be used to house them. He added that if the Agency wanted more developments within the City the homeless need to be removed from the sidewalks. 6. Redevelopment Business/Routine Matters. A. 2:25:56 PM Election of Chair &Vice-Chairperson The Board will nominate and elect a member to serve as the Chair and Vice- Chair of the RDA. View Attachment Director Rogers thanked Chairperson Penfold and Vice-Chairperson Adams for the great leadership they have provided during their terms. Chairperson Penfold asked whether any of the Board Members would like to serve as Chairperson or Vice-Chairperson of the RDA and invited interested individuals to address the Board. He clarified that the Chair serves a two-year term, and the Vice Chair serves a one-year term. Director Mendenhall nominated Vice-Chairperson Adams for Board Chairperson. Chairperson Penfold asked Board members to mark the ballots provided for Chairperson. The ballots were tallied with all members present voting for Lisa Adams. Director Adams said she appreciated the opportunity and that she had learned a lot during her term as vice-chairperson. She stated she is excited about the current momentum of the RDA and looks forward towards the next two years as Chairperson. . Director Luke nominated Director Kitchen for Vice-Chairperson. Director Mendenhall nominated herself. RDA Board Meeting Minutes Tuesday,January 12,2016 Page 4 Chairperson Penfold asked Board members to mark the ballots provided for Vice-Chairperson. Director Mendenhall, Vice-Chairperson Adams and Chairperson Penfold voted for Director Mendenhall. Directors Kitchen, Luke, Rogers, and Johnston voted for Director Kitchen. A majority of votes were cast for Director Kitchen. 2:36:51 PM Director Rogers made a motion to ratify the election of Vice-Chairperson Adams to serve as Redevelopment Agency Chair for a term of two years and Director Kitchen to serve as Redevelopment Agency Vice-Chair for a term of one year. Director Luke seconded the motion. Upon roll call, Chairperson Penfold declared the motion unanimously approved. B. 2:37:34 PM RDA Disclosure Forms RDA Staff will distribute and collect forms enabling Board Members to identify and declare any potential conflicts of interest. View Attachment Executive Director Baxter explained that each year, the RDA discloses the entities with which we do business to allow the Board and staff to publicly disclose any business relationships. He asked that Board members complete the disclosure forms that had been provided and return them to RDA Staff. C. 2:38:51 PM Open Meetings Training RDA Legal Counsel will present information to the Board regarding compliance with the Open Meetings Act. View Attachment Mr. Georgelas reviewed the guidelines and provisions of the Open Meetings training as provided in the briefing materials. D. 2:39:57 PM Briefing on Key Changes Proposed in New RDA Legislation RDA staff is providing a briefing on proposed changes to RDA legislation during the 2016 Utah State Legislative session. View Attachment Mr. Butterfield introduced Jason Birmingham as the RDA's legislative consultant. Mr. Butterfield provided a briefing on proposed changes to RDA legislation during the 2016 Utah State Legislative session. He said the new draft legislation is intended to clean up and partially rewrite the current Community Development and Renewal Agencies Act. He explained that there are two key issues being addressed 1)the treatment of incremental value upon the expiration of project areas; and 2) changing the project area creation process to combine Urban Renewal Areas (URA), Community Development Areas (CDA), and Economic Development Areas (EDA) into one type of area called the Community Development Reinvestment Agency Act("CDRAA"). Mr. Butterfield stated that additional changes would also include a new mechanisms to condemn or assume control of stalled developments,pool affordable housing resources, and permit a taxing entity committee to waive the limitation that prohibits the creation of a new project area that would cause the combined incremental value within agency project areas to exceed 10% of the total taxable value within the agency's boundaries. RDA Board Meeting Minutes Tuesday,January 12,2016 Page 5 Director Luke stated that on the surface pooling affordable housing resources sounds like a good idea, he asked staff to be cautious and ensure municipalities truly have the ability to opt in or out of the program. Due to not yet having the actual proposal or knowing how things will be phrased our legislative team need to be watchful that nothing is slipped in at the last minute. Director Luke stated that although the overall goal of pooling housing funds is to create more affordable housing, he is concerned that this type of policy could create a possible scenario where a majority of other cities opt out of the program requiring Salt Lake City to bear the lion's share of affordable housing. He asked staff to watch that this policy isn't a way for other communities to get out of their housing responsibilities for their residence. 7. Redevelopment Business/Old Business. A. 2:55:32 PM Consideration and Adoption of a Resolution to Enter into an Exclusive Negotiations Agreement for Development of the Utah Paperbox Property. The joint venture of PEG Development and Clearwater Homes is seeking approval to enter into an Exclusive Negotiations Agreement pursuant to the development of the Utah Paperbox property. View Attachment Mr. Davis provided background and timeline on the project. He stated that Staff is seeking approval to enter into an exclusive negotiations agreement for the development of the Utah Paperbox Property, located at 340 West 240 South. If approved, Staff would return to the Board with a Term Sheet, Concept Plan and Redevelopment Schedule for review and approval. Mr. Davis noted that the developer has requested a change to the policy provision requiring that 20 percent of residential units be reserved for households that earn 60 percent of Area Median Income (AMI) and requests that the prevision be modified to a range of 60-80 percent AMI. Mr. Davis stated that Micah Peters, CEO of Clearwater Homes and Kyle Jardine of PEG Development were present to answer any questions. Vice-Chairperson Kitchen mentioned concerns with safety over the 10,000 square feet of park space. He suggested options such as reducing the size of the park, making the park only accessible to the residents, and/or making a proposed private dog park open to the public to attract good use of the space and provide more eyes on the park. Mr. Peters explained that the geometry of the site is definitely a challenge,but as negotiations and the design become more refined he believes those challenges can be minimized by the things that had been suggested, or by creating a public/private park where access is restricted for public use at certain times. Director Rogers said that although he is in favor of this project, he is concerned about changing AMI from 60 percent to the 60-80 percent range and asked the developer to explain the request and the decision on the range. Mr. Peters stated that affordability is dependent on economics. He explained that the purpose of requesting a flexible AMI was to enable him to work more closely with the RDA to ensure the project is economically viable. Director Rogers asked the developer and RDA staff to look at different ranges such as 50-70 percent AMI, to encourage a broader option of tenants. Mr. Peters stated he would be willing to RDA Board Meeting Minutes Tuesday,January 12,2016 Page 6 look at a 50-70%range, but reiterated that the economics of the project will play a huge role in this decision. Director Rogers said he understood that this does come down to economics,but expressed concern that the focus would only be at the higher end of the AMI range. He suggested taking the required 20 percent of units set aside for affordable housing and dividing them equally between the 60%, 70%, and 80%AMI categories. Director Penfold asked if additional financing options for affordability are still an option. Mr. Davis said yes and that information will be presented to the Board in the term sheet. Vice-Chairperson Kitchen asked Staff to work with the developer to find out what the land sale would need to be in order to facilitate a 50-70%AMI project and report back to the Board. 3:14:20 PM Director Penfold made a motion to adopt the resolution(Resolution R-1-2016). Director Mendenhall seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved. B. 3:14:35 PM Update on the CDA Creation Process for the 9-Line and State Street Project Areas. Staff will update the Board on the process and schedule for creating the 9 Line and State Street Project Areas. View Attachment Ms. Lindsley reviewed the timeline for the new project area creation process and the next steps to develop draft project area plans. She explained that the six-month process will include community outreach, additional project area research, developing the terms of interlocal agreements with Taxing Entities, and drafting and adopting Project Area Plans. Director Rogers asked about the measures of success in these next steps. Executive Director Baxter said the measurements of success are set up directly within the Project Area Plan. Due to the new areas being quite large, the Agency will need to focus its efforts on certain activities or sub-geographies within these areas in order to ensure visible progress. Those areas of focus would become part of the Project Area Plan. Director Mendenhall encouraged Staff to meet with the Planning Division and Community and Economic Development (CED) on its community engagement process that facilitated the creation of Master Plans within the City. Ms. Lindsley stated that Staff has been coordinating with the Planning Division and those discussions have already begun. Director Mendenhall also suggested that Staff meet with the School Community Councils. Director Johnston asked Staff to look at multiple community locations in order to provide options for residents to attend the open houses. Director Rogers suggested holding small community meetings in peoples' homes to help reach more residents within the area. C. 3:25:43 PM Modifications to the RDA's Tax Increment Reimbursement Program. RDA Board Meeting Minutes Tuesday,January 12,2016 Page 7 Staff will present modifications to the RDA's Tax Increment Reimbursement Program for consideration and approval. View Attachment Ms. Wilkerson-Smith explained that Staff is looking at ways to improve the accessibility and uses of the Agency's Tax increment Reimbursement Program. Ms. Wilkerson-Smith presented the following three modifications to the RDA's Tax Increment Reimbursement Program: 1) The RDA expand the range of projects eligible to receive tax increment reimbursement beyond the current and limited circumstances (e.g., creation of structured parking, historic restoration, and creation of public open space) to any project that meets the objectives of the specific project area's Strategic Plan and the RDA's General Goals. 2) Incentivize catalytic projects by maximizing the amount of reimbursement to qualified applicants during the first ten years of each project area, and discontinue the Program's availability five years prior to the end of each project area. 3) Projects eligible for the Program must meet standard design guidelines, as determined during a design review process, to qualify for a tax increment reimbursement. She stated that Staff is seeking approval of these modifications. 3:28:40 PM Director Penfold made a motion to approve the modifications to the RDA's Tax Increment Reimbursement Program as presented. Director Luke seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved. 8. Redevelopment Business/New Business. A. 3:28:53 PM Housing Funding Update Staff will present an overview of current housing activities to inform a policy discussion on the RDA's housing strategy. View Attachment Ms. Hunsaker stated that affordable housing is an essential component of a livable and sustainable neighborhood. However, there is a mismatch between the demand for and supply of affordable housing in many of Salt Lake City's neighborhoods, with a shortage of affordable housing for the city as a whole. As more residents move into the City,there will be a greater need for a mix of housing types in close proximity to transit, employment, and services. She explained that with growth comes the need to accommodate residential development in a way that respects the character of neighborhoods while providing a broad array of housing types and sizes affordable at a mix of income levels. Ms. Hunsaker provided a presentation highlighting recent housing activities and policies, and how the Agency's housing strategy is helping to address citywide housing needs. She stated that Michael Akerlow, Director of Housing and Neighborhood Development was present to assist in answering any questions that Directors might have. RDA Board Meeting Minutes Tuesday,January 12,2016 Page 8 Director Penfold stated that in the past negotiations have taken place concerning the use of writing down land to incentivize affordable housing development. However, discussions typically take place in the middle or near the end of project negotiations with the developer. He suggested Staff look at tools and ways to create clear expectations of what the Agency is willing to do with a property/project in the beginning stages starting with the RFP in order to help prevent unexpected criteria from arising down the road. Ms. Hunsaker agreed and stated that Staff has recently begun putting its expectations and available incentives for affordable housing within the RFPs, but could even be more aggressive on identifying specific sites for affordable and mixed income housing projects. Director Penfold requested that RDA staff work closely with Housing and Neighborhood Development(HAND)to gather input on ranges of area median income (AMI) and project site selection, especially during the new project area creation process and when identifying projects to provide gap financing. Director Penfold asked Mr. Akerlow if the RDA choses to allocate more of its funds to housing, should those funds go towards the Housing Trust Fund or are there other ways this money should be used. Mr. Akerlow said that funds should continue to go to the Housing Trust Fund. He also suggested looking at the current ordinance and possibly updating it to allow for more flexibility. Director Kitchen stated that he would like to see more funds allocated for affordable housing and suggested staff look at ways the Tax Increment Reimbursement Program could capture more affordable housing units. Ms. Hunsaker stated that proposed changes to the Tax Increment Reimbursement Program would tie project eligibility to each project area strategic plan. As such, housing priorities approved within the strategic plans can be supported through the TI Reimbursement Program. Director Mendenhall and Penfold thanked Staff for providing the housing update and the collaboration with HAND. B. 3:46:51 PM Consideration and Adoption of a Resolution Approving the Term Sheet for a Loan Request from 10 Clift, LLC to Fund Renovations to the Clift Building at 10 West Broadway in the Central Business District Project Area. 10 Clift, LLC is seeking approval of a Building Renovation Loan for the Clift Building, a historic building located at 10 West Broadway. View Attachment Mr. Davis explained that 10 Clift, LLC is requesting a$3,543,500 Building Renovation Loan to make significant capital improvements to the historic Clift Building, located at 10 West Broadway. The Applicant believes that such improvements are needed to reposition the underperforming Property in the market. Improvements that will be made are things such as upgrading the HVAC, renovating the lobby, structural and electrical improvements, and installation of new windows, a gym, showers, and bike storage facilities. Mr. Davis added that the Borrower will also be participating in the new Project Skyline initiative to calculate and measure energy consumption saved with these improvements. RDA Board Meeting Minutes Tuesday,January 12,2016 Page 9 Mr. Davis said that the project meets the Agency's loan criteria, except for the loan amortization. The Building Renovation Loan criteria states that the loan is amortized over 20 years. In order to help the applicant achieve the minimum debt service coverage ratio for this project, Staff recommends amortizing the loan for 30 years, rather than the standard 20-year term. Mr. Davis stated that David and Kevin Phipps from 10 Clift, L.L.C. was present to answer any questions. Director Mendenhall said she would like to quantify the energy consumption savings and suggested listing them in the Agency's annual report or some other reporting mechanism. 3:53:53 PM Director Penfold made a motion to adopt the resolution(Resolution R-2-2016). Director Rogers seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved and the resolution was adopted. C. 3:54:31 PM Howa Garden Proposal Discussion regarding the temporary re-use of RDA-owned property in the Depot District to be used as a space for a job training garden for homeless women. View Attachment Mr. Butterfield introduced Ashley Patterson of Wasatch Community Garden and Camille Winnie of the Downtown Alliance. Mr. Butterfield stated that Staff is proposing to activate the Howa Garden property located at 628 West 100 South with a temporary use. The RDA will collaborate with Wasatch Community Gardens and the Downtown Alliance to create a temporary job training garden for homeless women. The total cost of the project is approximately$57,000 and the Agency will contribute $27,000 in matching funds. Director Mendenhall asked whether soil contamination would be an issue and requested that Staff verify the fruit from the pear trees is safe to consume. Ms. Lindsley stated that the first environmental test on the soil came back positive. However, when additional testing was completed there were no further signs of contamination. Mr. Butterfield added that the RDA will continue to monitor any contamination issues. Director Mendenhall said she is very excited about the project and is happy about the collaborative effort. However, stated she wants to ensure that this is just a temporary project, due to this property being cited for a future development. Director Penfold asked if there a way to measure the outcome and success of the project. Ms. Winnie said that the measurement of outcome would be based on the permanent employment of the women and ability of the women to move productively out of the training. Those measurements could be reported back to the RDA. Director Penfold said he likes this project and that the RDA should look further into interim use projects for RDA properties and how to budget for them in the future. He added it would be great RDA Board Meeting Minutes Tuesday,January 12,2016 Page 10 to tie employment as an interim use when possible. Mr. Butterfield said he would make sure to add this as part of the upcoming budget discussions. Vice-Chairperson Kitchen expressed his desire to increase the Agency contribution to 60-70 percent. Chairperson Adams noted that although Board members may want to increase the funds going toward this project that there is not really a budget for it and that staff has pulled funds together in order to make the 50 percent contribution. She reminded Board members that in order to increase funds this discussion would need to take place during the budget process and that would delay the project until June, if approved. She encouraged Board members to utilize the funds currently available in order to get the project underway,but asked Board members to keep things such as this in mind during the next budget cycle. 9. Consent. None. 10. Written Briefings. A. 4:10:43 PM Status Report on RDA Loan Portfolio Semiannually, staff provides an update to the Board and RAC on the current status of the Agency's loan portfolio. View Attachment Executive Director Baxter explained that the RDA Staff provides a Loan Portfolio every six months to keep the Board up to date on loan delinquencies and/or pay offs. He stated there are no delinquencies at this time. 11. Closed Meeting. A. Consider Adopting A Motion To Enter Into A Closed Meeting In Keeping With Utah Code To Discuss Pending Litigation and/or The Acquisition/Disposition Of Real Property and/or Attorney-Client Matters That Are Privileged Pursuant To Utah Code Ann. § 78b-1-137(2). Chairperson Adams pulled this item from the agenda. 12. 4:11:21 PM Adjournment. There being no further business, Chairperson Adams declared the meeting adjourned. Lisa Adams, Chairperson This document along with the digital recording constitute the official minutes of the Redevelopment Agency of Salt Lake City Board of Directors meeting held, January 12, 2016.