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HomeMy WebLinkAboutCRC-01-15-98Carmel Redevelopment Commission Minutes January 15, 1998 The meeting was called to order at 5:45 p.m by President Rick Roesch. Members Ron Carter and Susan Westermeier were present, constituting a quorum. Also in attendance were Mayor Brainard; Neal Steinbart of Barnes & Thornburg; Luci Emison of Ice Miller Donadio & Ryan; Craig S. Hessee from the Linder Co; Loren Rooney of H.J. Umbaugh & Associates; Kevin Kirby and Norm Rundle, City Councilors; Nancy Blondin of the Carmel/Clay Chamber of Commerce; Tom Harleman, citizen. Scott Miley represented the Indianapolis Star/News. Ms. Westermeier made a motion to accept the minutes of the December 15 meeting as presented. Following a second by Mr. Carter, the minutes were unanimously approved. The first item under discussion was the preliminary bond resolution for Merchants Square. This is the final step, as the Commission approved the creation of the TIF area last spring. At that time Linder Co agreed to provide a purchaser for the bonds. McDonald & Co., investment banker from Cleveland, has agreed to purchase the tax increment revenue bonds. Tonight's resolution will establish the parameters; a maximum of $2,655,000, maximum. interest rate of 7%, with a term of 20 years. The bond payments will be made from tax increment revenues, with a security guaranteed from the Linder Co. and their affiliates to make up the difference, if tax increment revenues are insufficient. The bond proceeds will be used to pay for the road improvements as fisted on the Resolution. A notice of the intent to issue bonds will be posted, thereby starting a statuatory period of about 3 weeks, after which the bonds can be sold. Details are being worked out. They anticipate coming back to the Redevelopment Commission in about 2 weeks for the purpose of approving the final bond resolution and to hold a public hearing to approve the appropriation of the bond proceeds. Loren Rooney, financial advisor, has also suggested that a couple parcels be added to the Economic Development. Area, which necessitates another public hearing, but does not require a return to the Plan Commission, due to its being less than 20% of the original area. Following discussion, Mr. Carter made a motion to approve the preliminary bond Resolution 1-1998. Ms. Westermeier seconded the motion, after which approval was unanimous. Neal Steinbart explained the three items on the agenda relative to the City Center project; an amendment to the 12e St. Corridor Economic.Development, creation of a City Center Redevelopment area, and the Bond Resolution. He reviewed the action of the Redevelopment Commission in June, 1997, at which time an economic development area was set up. The amendments include a deletion of certain parcels, and addition of certain other parts. The amended area would in its entirety be designated as an allocation area- A base assessed value of the area would be as of Mi arch, 1997. Any additional property Redevelopment Commission Minutes 1/15/98 Page 2 taxes occurring as a result of increased property values would be set aside an a special allocation fund to be used by the Redevelopment Commission for any sort of economic development project within the economic development area or any project which directly serves and benefits the economic development area. The second resolution creates the new redevelopment area. The resolution designates the blighted area, and authorizes the Commission to acquire parcels the City doesn't already own, and to develop those areas.. Finally, the redevelopment area would be designated as an allocation area, and to the extent that taxes revenues are generated by reason of an increase in assessed value, those funds can be used by the Redevelopment Commission for any projects within the redevelopment area, or in areas that are affected by it. The Bond Resolution authorizes the issuance of up to $10,500,000 of Redevelopment Commission's revenue bonds, that can be payable solely from the City's share of COIT distributions. No city money other than the city's share of COIT monies would be at risk Proceeds of those bonds could be used for any City Center projects; land acquisition, construction, etc. Mr. Kirby asked for clarification about the repayment of the bond monies. Ms. Rooney explained that the COTT monies are intended to be used for that purpose, but if those funds should not be sufficient, TIF monies could be used to make up the difference. The intent is to use the captured T1F money to replace the COIT, but there is no guarantee of that City Council is the only body with the authority to pledge the use of COTT monies. In 1997 the Common Council adopted an ordinance pledging a portion of COTT to pay for a $32,000,000 bond. We can issue additional obligations payable from COLT so long as the coverage cap of 125% is satisfied. Our ability to issue these bonds depends on our ability to satisfy that 125% cap. The Mayor inserted the fact that the City will be receiving $1 million additional from COIT, due to growth. Based on what's under construction now, we think about one third of the debt service will be covered by this one year. Ms. Rooney estimates that about $700,000 would be available from tax increment projections from the City Center and from construction already in progress, and if the City Center continues to develop, we would reach $1 million from tax increment, without touching COIT funds. Mr. Kirby asked what the $10 million will be used for. The Mayor replied that $2.6 million will go to reimburse the operating balance of the General Fund for the purchase of the old Kroger building. The rest will go toward land acquisition for the remaining 4 Redevelopment Commission 1/15/98 page 3 parcels, demolition of buildings, power cables in the area, as well as a substantial amount of other infrastructure - streets, sidewalks, parking, etc. As the City returns the parcels to the developers, they will pay the city, thus reimbursing the fund. The Mayor said the money will go back to the Redevelopment Commission. Mr. Kirby would like assurance monies would go to retirement of the debt, as he feels the Redevelopment Commission has pretty loose powers. The Mayor said the Commission should have the discretion to do things that need to be done, based on whether TIF is paying the bonds. Ms. Rooney said the intent is to use TIF, but that there is a desire to preserve flexibility. Mr. Kirby stated that the only guarantee is the COLT, that the TIF money is not tied to bond reduction. Mr. Roesch said there could be an economic decision regarding monies coming into the funds. This Commission has tried to be very open, and to work in partnership with the Common Council toward the common good. ( Tonight marks the first step in the process by considering the Declaratory Resolutions. The public hearing was opened at 6:30 p.m. There being no comment from the public, there was a motion to close the public hearing at 6:31 p.m Mr. Carter seconded the motion, which then was unanimously approved. Mr. Carter made a motion to approve Resolution 2-1998, which amends the boundaries of the economic development area, approves the amended plan for the area, and declares it an allocation area Ms. Westermeier seconded the motion, which then passed. Ms. Westermeier made a motion to approve Resolution 3-1998 which declares the redevelopment area, approves a plan for the area, and declares the area an allocation area Following Mr. Carter's second, the resolution was unanimously approved. Resolution 4-1998_ in which the Redevelopment Commission authorizes the issuance of bonds for the reimbursement of expenses incurred in connection with the acquisition and redevelopment of certain property was approved, after a motion to do so was made, seconded, and a vote taken- In other business, it was announced that Elizabeth Tezyaw has been appointed by the Mayor as the fifth member of this commission, filling the vacancy created by Ms. Boschini's move out of the Carmel area. Redevelopment Commission 1/15/98 page 4 It was agreed to delay the election of officers until the next meeting, when all members may be present The next meeting has been tentatively scheduled for Wednesday, January 28 at 5:30 p.m.. The meeting was adjourned at 6:40 p.m. Approved