Council Provided Information - 11/10/2022CITY COUNCIL OF SALT LAKE CITY
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COUNCIL STAFF REPORT
CITY COUNCIL of SALT LAKE CITY
TO:RDA Board Members
FROM: Ben Luedtke
Budget and Policy Analyst
DATE:November 10, 2022
RE: Redevelopment Agency (RDA)
Budget Amendment Number Two FY2023
________________________________________________________________________________
NEW INFORMATION
At the October 11 meeting, the RDA Board discussed the four proposed items in this budget amendment. The Board
may consider voting on some or all items at the November 10 meeting after holding the public hearing. Updates
since the briefing include:
- The Board requested that development scenarios include the potential for ground leasing some or all
properties owned by the RDA. This will be included in the Station Center Vision Plan final scope of work.
- The Board discussed taking the opportunity presented by the Vision Plan to also review changing the name
and/or consolidating under one name the Station Center and Central Station areas.
- A list of stakeholders was shared with the Board who were involved in the consultant’s work under the
University of Utah contract. The Board may suggest additional people and organizations to be included
should the RDA take over the contract and adjust the scope of work to better fit the City’s needs.
ISSUE AT-A-GLANCE
RDA Budget Amendment Number Two includes requested changes to budgets in the Depot District project area,
North Temple project area, West Capitol Hill project area, Citywide Housing Fund, Revolving Loan Fund, and the
Administration budget. Total expenditures are slightly over $3.5 million for four items. Note there is one Board-
added item. The additional and background information section near the end of this staff report includes project
area expiration dates and allowable uses of RDA funds per state law.
$4 Million Gap Loan to Spark! Project (former Overniter Motel at 1500 West North Temple)
Funding for the gap loan is proposed to come from rescoping three existing budgets as detailed in the table below
provided by RDA staff.
Fund Program Current
Amount
Requested
Amount
Updated
Amount
Primary
Housing Fund Property Acquisition $1,599,880 $1,500,000 $99,880
Multiple North Temple Strategic
Intervention Funds $2,936,762 $1,500,000 $1,436,762
Project Timeline:
Set Date & 1st Briefing: October 11, 2022
Public Hearing & 2nd Briefing: November 10, 2022
Potential Action: November 10, 2022
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Multiple Housing Development Loan
Fund (HDLP) - Fall NOFA $7,000,000 $1,000,000 $6,000,000
This item is a follow up from September 13 when the Board approved the seller’s note for the land disposition. The
Board also took a unanimous straw poll in support of this gap loan request. If the gap loan is approved, then the
RDA’s total financial contribution to the development would be $14,456,000. A budget impact graphic near the end
of the transmittal provides a visual breakout of the six RDA funding sources going to the Spark! project.
$46,805 from RDA Administration Fund Balance for Market-based Salary Adjustments to Non-
represented Employees
This is a housekeeping item to implement compensation changes from the annual budget. A salary study for non-
represented employee positions identified potential adjustments to ensure compensation is competitive in the
current market. In the annual budget, the Council approved nine months of funding to cover salary adjustments
beginning in October. The RDA and some enterprise funds (e.g., the Airport) did not have the study results
available at the time of budget development and adoption which is why the item appears in a budget amendment.
Up to $500,000 for RDA to take on Station Center Vision Plan Contract from University of Utah
Half a million dollars is requested to transfer to the RDA an existing consultant contract held by the University of
Utah. The contract is to create a master planning document of development scenarios for Station Center. The scope
of work would be adjusted to reflect the RDA’s goals including the addition of RDA owned properties near Station
Center, coordination for redevelopment of nearby properties owned by UTA, information to develop a Housing and
Transit Reinvestment Zone (HTRZ) application to the State, and inclusive development with firms of multiple sizes
and backgrounds.
The funding is proposed to be equally split from two sources: $250,000 from Station Center public infrastructure
budget and $250,000 from Central Station improvements budget. The total cost of Station Center public
infrastructure is estimated to be $15 million. This item would increase the $9.5 million funding gap.
Draft of Revised Scope of Work
The below draft includes deliverables in the existing scope of work and potential adjustments should the RDA take
on the contract. Additional scope of work items could be added, and the draft items refined. The RDA is currently
drafting a revised scope of work (listed below) because the original scope included items specific to the University of
Utah. The consultants estimate the revised scope of work would take approximately eight months to complete. This
approach is recommended by the RDA as a faster alternative than going back out for another RFP to select a new
consultant. For example, a new RFP could take a few months from drafting to finalizing a contract. The existing
consultant’s work-to-date would be incorporated into the revised scope and deliverables.
A. Authentic community engagement effort that brings new partners into the fold, including nearby Westside
residents, community leaders, institutional partners, businesses, and nonprofits, and coordinates with
other nearby redevelopment efforts.
B. Real estate market analysis to assess the appropriateness of anticipated land uses, including commercial
office, lab, residential, and retail spaces, and feasible affordability mix.
C. Illustrative site plan that locates proposed land uses, shared parking areas, vehicular circulation and
loading/service patterns, open space, and pedestrian network, and more.
D. Recommended placemaking, programming, and activation strategies.
E. Development phasing and property disposition strategy that incorporates best practices for equitable
development and provides opportunities for various types of development teams.
F. Innovation industry partnership strategy that outlines best practice approaches to identifying and
recruiting prospective tenants and integrating them into the future district.
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G. Refinement of Station Center Design Guidelines to reflect anticipated land uses and increased building
height allowances in the Gateway Mixed-Use zoning district.
H. Information necessary to submit a competitive application to establish a Housing and Transit Reinvestment
Zone (HTRZ) around the UTA Intermodal Hub.
Policy Questions:
➢Feedback on Draft Scope of Work – The Board may wish to review the draft scope of work above and
provide feedback before approving this budget item.
➢Ground Lease Development Scenario(s) – The Board may wish to discuss adding ground lease development
scenarios to the scope of work. In recent discussions some Board Members have expressed interest in
pursuing a ground lease approach for RDA-owned properties.
➢Stakeholders to Include – The Board may wish to ask the Administration which stakeholders were engaged
during the consultant’s initial work and suggest additional persons and organizations.
Station Center Site Plan Map
Note the Board approved funding in Budget Amendment #1 to purchase the three diagonal hash marked parcels
in development site #4
Over the years, the RDA has purchased multiple properties in the Station Center area which is defined as two blocks
of west downtown located between 500 West to 600 West and 200 South to 400 South. Concepts for the area have
included an innovation district, mixed-use transit-oriented development, and new public rights of way to create
smaller more pedestrian friendly block sizes. If this item is approved, then the $9.5 million funding gap would
increase for the $15 million of proposed public infrastructure projects. The Administration recommends the Board
consider using future proceeds from land sales in Station Center to fund some of the infrastructure improvements.
The infrastructure improvements include creation of new street segments to create smaller block sizes, utility
upgrades to allow greater building densities, and a Festival Street (300 South) amenities.
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34 Acres of UTA and 4 Acres of RDA-owned Properties in “Central Station”
The UTA and the RDA collectively own approximately 38 acres of land identified for potential development in the
Central Station area. The properties are located between 600 West to Interstate 15 and Dansie Drive (50 South) to
400 South as well as properties on either side of the North Temple bridge spanning 400 West to 600 West. In 2018
the RDA and UTA partnered on a development plan for these properties from which the below map is copied. The
RDA-owned properties are approximately four acres along 100 South between 600 West and Interstate 15.
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Returning $1 Million No Longer Needed to Cover Cost Increases for RDA Marmalade Plaza Project
($720,000 to Revolving Loan Fund and $280,000 to Arctic Court Infill Home)
Note: this is a Board-added item
In RDA Budget Amendment #1 the Board approved $720,000 from the Revolving Loan Fund and $280,000 from
the Arctic Court infill home budget to cover anticipated cost increases for the Marmalade Plaza project. This
funding was approved to ensure sufficient budget existed to fully cover the costs included in the time-limited bid
and sign the construction contract. The Board requested that the funding source be changed to parks impact fees in
a follow up budget amendment. The Council approved $1 million in General Fund Budget Amendment #3 for this
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project. This item will return the $720,000 to the Revolving Loan Fund to be available for future loans and
$280,000 to the Arctic Court infill home holding account.
Policy Question:
➢Return More Funding to Arctic Court Infill Home Budget – The Board may wish to discuss with the
Administration that after the project is completed any remaining funds be used for the Arctic Court Infill
Home. The RDA reports based on existing information the Marmalade Plaza costs are expected to come in
below the $3.9 million total project budget (detailed in the below table), but final costs won’t be known
until it’s completed.
Source Approved Budget Notes
Park Impact Fees $2,145,394 Restricted to eligible projects and must be
refunded with interest if not spent by deadline
Property Sale Proceeds $1,362,065
Program Income Fund (PIF)
Artic Court Infill Home Rescope $338,141
West Capitol Hill Interest Income $100,000
More flexible than tax increment funding.
Subject to allowable uses per state law (see
additional info section).
TOTAL $3,945,600
ADDITIONAL & BACKGROUND INFORMATION
Project Area Expiration Dates
Project areas have a designated expiration (aka sunset) date. State law allows RDAs to continue spending tax
increment already collected in expired project areas such as Sugar House. Sometimes project areas can be
extended/renewed for a longer length which happened to the Central Business District. The table below
summarizes project area timeframes from creation to expiration.
Project Area Initial Collection
Year
Last Collection
Year
Central Business District*†1983 2042
West Capitol Hill**1998 2022
Depot District†1999 2024
Granary District†2000 2025
North Temple†2012 2039
North Temple Viaduct CDA 2012 2037
Northwest Quadrant 2019 2038
Block 70 CDA 2016 2040
Stadler Rail 2019 2038
Block 67 2021 2040
9-Line 2021 2040
State Street 2021 2040
NOTE: Only project areas that generate tax increment are listed in the table
*The RDA Board extended the CBD from the original expiration year of 2007
** The RDA Board extended the original expiration year to focus on 300 West streetscape
improvements
†In October 2021 the Board approved two-year extensions for these project areas. State law was
changed to allow extensions for projects areas negatively impacted by the COVID-19 pandemic
Statutory Definition of Project Area Development (Utah Code 17C-1-102(48))
The section of Utah Code below is a key list of allowable uses of RDA funds. The Utah Legislature updated this
statute in the 2016 General Session.
(47)"Project area development" means activity within a project area that, as determined by the board, encourages,
promotes, or provides development or redevelopment for the purpose of implementing a project area plan,
including:
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(a)promoting, creating, or retaining public or private jobs within the state or a community;
(b)providing office, manufacturing, warehousing, distribution, parking, or other facilities or improvements;
(c)planning, designing, demolishing, clearing, constructing, rehabilitating, or remediating environmental
issues;
(d)providing residential, commercial, industrial, public, or other structures or spaces, including recreational
and other facilities incidental or appurtenant to the structures or spaces;
(e)altering, improving, modernizing, demolishing, reconstructing, or rehabilitating existing structures;
(f)providing open space, including streets or other public grounds or space around buildings;
(g)providing public or private buildings, infrastructure, structures, or improvements;
(h)relocating a business;
(i)improving public or private recreation areas or other public grounds;
(j)eliminating blight or the causes of blight;
(k)redevelopment as defined under the law in effect before May 1, 2006; or
(l)any activity described in Subsections (48)(a) through (k) outside of a project area that the board
determines to be a benefit to the project area.
ATTACHMENTS
1. RDA Guiding Framework
ACRONYMS
FY – Fiscal Year
HDLF – Housing Development Loan Fund
HTRZ – Housing and Transit Reinvestment Zone
NOFA – Notice of Funding Availability
PIF – Program Income Fund
RDA – Redevelopment Agency