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05/31/2016 - Minutes MINUTES OF THE 770th MEETING OF THE BOARD OF DIRECTORS OF THE REDEVELOPMENT AGENCY OF SALT LAKE CITY Tuesday, May 31, 2016 451 South State Street, Room 326 Salt Lake City, Utah 1:00 p.m. 1. 1:11:10 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 Andrew Johnston, Director James Rogers, Director Erin Mendenhall, Director Absent: Stan Penfold, Director Charlie Luke, Director Also Present: Justin Belliveau, Chief Administrative Officer Others Attending: Ed Butterfield, Senior Project Manager Jill Wilkerson-Smith, Project Manager Kort Utley, Project Manager Tammy Hunsaker, Project Coordinator Katie Lewis, Agency Legal Counsel Crayola Berger, Accountant II Jolynn Walz, Office Manager Kalli Ruiz, Office Facilitator Louise Gonzalez, Administrative Secretary George Chapman, Salt Lake City resident 2. 1:11:33 PM Public Comments. Mr. George Chapman said that helping the downtown homeless population should be a top priority within the RDA's Implementation Schedule. He suggested using more RDA funds to help eliminate homelessness before concentrating on further developments in surrounding City areas. RDA Board Meeting Minutes Tuesday,May 31,2016 Page 2 Some items were considered in an order different than listed on the agenda, time stamps shown indicate when items were considered. 3. Redevelopment Business Action Items. A. 1:14:08 PM Presentation on RDA Budget Process RDA Staff will lead a discussion providing an overview of practices and process in setting its Annual Budget. View Attachment Mr. Butterfield provided a presentation on the RDA's practices in setting its annual budget, its guiding laws, and structure. This overview highlighted the RDA's mission statement, changes to the Community Reinvestment Act (CRA), the RDA's Implementation schedule, and the State law concerning RDAs and eminent domain. Director Mendenhall asked staff to look into options for changing the proposed State Street Project Area to a URA, where a blight study is required and eminent domain is an option. Director Johnston said the Board currently has the option of eminent domain in the North Temple Project area, but it has never been utilized in this area. He asked what the parameters are to determine when the Board would use eminent domain within its project areas and said he felt unless the Board intends to utilize eminent domain, there would be no need to change the State Street Project Area. Chief Administrative Officer Belliveau said staff would speak to legal counsel to determine whether there is an option to make this change. Chairperson Adams requested that staff create a process where the RDA's Mission Statement is reviewed and updated every few years. Director Rogers asked staff to provide quarterly status updates on the Implementation Schedule and to highlight any projects that may be behind schedule and why. Mr. Butterfield said staff could provide this information quarterly. 4. Redevelopment Business Action Items. A. 2015/2016 Budget 1:41:01 PM 1. Continuation of the Public Hearing held on May 10, 2016 for Consideration of the Third Amendment to the 2015-2016 Annual Implementation Budget The RDA Board will hold a Public Hearing to accept comments from the public regarding the proposed Third Amendment to the 2015-2016 RDA Budget. View Attachment Chairperson Adams stated that this is a continuation of the public hearing for the third amendment to the 2015-2016 Annual Implementation Budget. RDA Board Meeting Minutes Tuesday,May 31,2016 Page 3 George Chapman stated that he disagrees with the proposal of relocating the Sugar House Fire Station. He also stated that he felt the warehouse owned by Nicholas & Co. located in the Depot District could be used as a day shelter for the homeless population. 1:43:41 PM 2. Discussion of Third Amendment to the Annual Implementation Budget for the Fiscal Year Commencing July 1, 2015 and Ending June 30, 2016. RDA staff will present for the Board's review the third amendment to the Annual Implementation Budget. This amendment acknowledges receipt of tax increment funds for the current fiscal year, finalizes tax increment reimbursement payments, and options of funds for several new and previously approved projects. View Attachment Chief Administrative Officer Belliveau reminded the Board that the Third Amendment to the Annual Implementation Budget reconciles the budget with actual tax increment proceeds received, finalizes the amount paid to the taxing entities and tax increment reimbursement recipients, and then proposes reallocation of some funds for projects. Chief Administrative Officer Belliveau explained that the information presented today is similar to the information that was provided to the Board at the May 10, 2016 meeting, with the addition of the following proposed revisions. • Project Area Housing-the proposed budget included as "Misc Income (CitiFront Payment)" a source of revenue from the receipt of a loan payment by NeighborWorks Salt Lake in the amount of$529,967, and a proposed allocation of these funds to the project identified as "North Temple Catalytic Development."As the Board deferred taking action on the request to forgive and return the loan payment to NeighborWorks Salt Lake pending a discussion of its policy on loan forgiveness, we are likewise proposing to defer the identification of a use of these funds until this matter is fully resolved. We will therefore continue to show this receipt as revenue received for the 2015/2016 fiscal year, and propose to carry it as part of the fund balance for Project Area Housing until the Board has the opportunity to discuss and identify a use of these funds. • Block 70 CDA Fund-the proposed Third Amendment to the 2015-2016 Annual Implementation Budget presented at the May 10, 2016 Board meeting identified a contribution from Salt Lake City of its share of tax increment from the Central Business District as "SLC CBD Increment"totaling $2,935,735. The attached proposed amendment clarifies that this contribution arises from two sources. The first is related to an Interlocal Agreement dated December 1, 2011 between the City and the RDA,which provides that the RDA will retain 80% of the remaining allocation of tax increment from the Central Business District to the City(after distributing to the City the "2014 Equivalent Revenues" of$1,808,093), and distribute the remaining 20%to the City. The second is related to an Amendment to Interlocal Cooperation Agreement dated May 30, RDA Board Meeting Minutes Tuesday,May 31,2016 Page 4 2013 between the City and the RDA, which provides that the RDA will retain 100% of the remaining allocation of tax increment from the Central Business District(after distributing to the City the"2014 Equivalent Revenues" of$1,808,093), for application to the payment of principal and interest on bonds for the Eccles Theater project. The agreement further provides that, to the extent that any increment revenues allocated to the project are not needed in any given year to pay amounts due with respect to the project, the RDA will allocate and pay up to 20% of the remaining tax increment allocation from the Central Business District to the City. The proposed amendment to the 2015-2016 Annual Implementation Budget further identified"Eccles Theater Construction" as a proposed use of$15,971,180 from available sources in the Block 70 CDA Fund. The attached revised amendment corrects this projection to propose an allocation of$14,400,000 required to complete construction of the project. The necessity to allocate funds for this purpose relates to an increase in the project budget that is attributable to a $12 million increase in the cost of construction (previously identified to the Board in written briefing materials from the March 15, 2016 and April 12, 2016 meetings), and the addition of$2.4 million construction cost related to the integration of the 111 Main project with the Eccles Theater project. The developer of the 111 Main project has provided a reimbursement to the RDA for these integration related expenses, which is included in"Reallocation of previous year Fundraising" as a source of funds. The proposed amendment presented to the Board at the May 10, 2016 meeting also included as a"Required Allocation"the set aside of the remaining $562,752 for Future Debt Service. This figure has been updated to capture the revised projection of the cost to complete construction of the project noted above, and the revised amendment proposes to set aside these funds as a reserve for future debt service obligations on the Eccles Theater project. It should be noted that receipts from Private Fundraising provide a significant source of funds for debt service for the Eccles Theater project. To date, $35.25 million has been committed to the project from private sources. Of these funds, $10.25 million are committed to be provided by donors in forthcoming fiscal years. Out of an abundance of caution, it is proposed that excess funds received through the 2015-2016 fiscal year be set aside to ensure adequate resources are on hand as needed to cover future debt service payments. Director Mendenhall requested that during a future RDA meeting, staff provide an update on the fundraising efforts for the Eccles Theater and also include the amounts and probability of fundraising and donors that may be expected once the theater has opened. 1:54:59 PM Director Mendenhall made a motion to close the public hearing. Vice-Chairperson Kitchen seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved. RDA Board Meeting Minutes Tuesday,May 31,2016 Page 5 B. 2016/2017 Budget 1:55:39 PM 1. Public Hearing for Adoption of the 2016/2017 Annual Implementation Budget. The RDA Board will hold a Public Hearing to accept comments from the public regarding the proposed 2016-2017 RDA Budget. View Attachment Chairperson Adams opened the public hearing for the adoption of the 2016-2017 Annual Implementation Budget and called for public comments. George Chapman asked that the RDA open its developer forum to the general public and community council in the North Temple Project Area and added that he is concerned of the lack of wide sidewalks along North Temple to create a boulevard atmosphere. Mr. Chapman reminded Board members of his concern for the homeless population in the downtown area and stated that more needs to be done to help remove these individuals from living on the streets. He added that the streetcar should not be a priority for the RDA and that any funds allocated to it would be better utilized for the expansion of neighborhood bus routes. 1:59:03 PM 2. Discussion of the Proposed Annual Implementation Budget for the Fiscal Year Commencing July 1, 2016 and Ending June 30, 2017. RDA staff will present for the Board's review the RDA's Annual Implementation Budget for the 2016-2017 fiscal year. View Attachment Mr. Butterfield and Mr. Utley presented the proposed 2016/2017 Annual Implementation Budget. Director Mendenhall requested an itemized list of the costs for Sugar House's Temporary Property Expense account. Mr. Butterfield said staff would provide that this information to her. Director Mendenhall asked staff to provide an update on projected expenses concerning the operations of the Eccles Theater,prioritize those expenses, and identify any other operational funding needs the RDA may have to cover until everything is in place. Vice-Chairperson Kitchen requested an update on the streetcar plan for downtown. Chairperson Adams suggested the update take place during a future RDA and City Council meeting. 2:38:52 PM Director Mendenhall made a motion to close the public hearing. Director Rogers seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved. 5. 2:39:11 PM 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 RDA Board Meeting Minutes Tuesday,May 31,2016 Page 6 and/or Attorney-Client Matters That Are Privileged Pursuant To Utah Code Ann. § 78b-1- 137(2). Director Rogers made a motion to enter into a closed meeting to discuss matters of pending litigation and/or the acquisition/disposition of real property and/or attorney-client matters and that the Board meeting would stand adjourned at the conclusion of the closed meeting. Director Johnston seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved. The closed meeting of the Board of Directors of the Redevelopment Agency of Salt Lake City was held at the City and County Building, 451 South State Street, in Room 326 at 2:41 PM on Tuesday, May 31, 2016. 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; Andrew Johnston, Director; James Rogers, Director; Erin Mendenhall, Director. The following Board members were not in attendance Charlie Luke, Director and Stan Penfold, Director. The following members of the staff of the Redevelopment Agency of Salt Lake City were present: Justin Belliveau, Chief Administrative Officer; Crayola Berger,Accountant II; Jolynn Walz, Office Manager; Kalli Ruiz, Office Facilitator; Louise Gonzalez, Administrative Secretary; Kort Utley, Project Manager; Tammy Hunsaker, Project Coordinator. Others present: Tom Berggren, RDA Legal Counsel; Katie Lewis, Legal Counsel; Margaret Plane, Legal Counsel; Cindy Gust-Jensen, Salt Lake City Council Office; Jennifer Bruno, Salt Lake City Council Office; David Litvack, Deputy Chief of Staff; Patrick Leary, Chief of Staff. The Board discussed the acquisition/disposition of real property and attorney client matters that are privileged pursuant to Utah Code. There being no further business, Chairperson Adams called for a motion to exit the closed meeting. Vice-Chairperson Kitchen made a motion to exit the closed meeting and Director Mendenhall seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved and the closed meeting. The meeting was adjourned at 3:00 PM. 6. Adjournment. There being no further business, the meeting was adjourned. Lisa R. Adams, Chairperson