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HomeMy WebLinkAboutCRC-12-20-00CARMEL REDEVELOPMENT COMMISSION Wednesday, December 20, 2000 Council Chambers, Carmel City Hall 7:00 P.M. AGENDA 1. Call to Order 2. Approval of Minutes from November 8, 2000, November 8 Executive Session, 2000, November 13, 2000, and November 20, 2000, meetings. 3. Report from Mayor 4. Report from Director 5. Financial Report 6. Report from Attorney 7. Report from Architect 8. Reports from CRC Members 9: Approval of Invoices (Included in packet) 10. Old Business 11. New Business 12. Signing of Documents (if any) 13. Schedule Next Meeting (January 10, 7 p.m., Caucus Room) 14. Adjournment ZAredevcomm\2000 Dec 20 Agenda CARMEL REDEVELOPMENT COMMISSION Meeting, Wednesday, December 20, 2000 President Rick Roesch called the meeting to order at 7:05 p.m. Commission members Luci Snyder and John R. Koven were present constituting a quorum. Also present were Joe Staehler, Sherry Mielke, Les Olds from CSO, Lisa Lee from ice Miller, Karl Haas, Bob Falk, Peter Miller, Chris Seger, Duke-Weeks, Phil Dunlap, Pam Lambert, Mark Ratterman. Phyllis Morrissey present as support staff. Minutes Mr. Koven made a motion the minutes from the last four meetings (November 8, Regular V and Executive Session, November 13, and November 20) be approved as mailed. Following a secondby.Ms. Snyder, the motion was unanimously approved. Report from Mayor In the absence of Mayor Brainard there was no report. C v Report from Director Mr. Staehler reported the CRC needs to appoint a_purchasing agent and that name is to be submitted to the Clerk-Treasurer's office. Mr. Roesch suggested it-be Mr. Staehler. So moved by Ms. Snyder. Following a second by Mr. Koven the motion was unanimously approved. Mr. Staehler reported it would appropriate for the CRC to appoint a person who can give approval for change orders on projects. Mr. Staehler recommended Ms. Roesch be given authority to approve change orders up to 5%0 of the contract and anything above 5% of the contract amount would require full board approval. Mr, Roesch asked if that would be in the aggregate. Mr. Staehler said there are usually limits on the amount of change orders which can occur in a contract and that limit is normally 20%. "1 would suggest 5% of the initial contract. If it goes above 5% in aggregate, then it should be at the entire Commission's authority." Mr. Koven made a motion that change orders up to 5%o in the aggregate can be approved by Mr. Roesch, and that anything beyond that would require approval by the Commission at a meeting (or special meeting so it could be taken care of right away). Following a second.by Ms. Snyder, the motion was unanimously approved. Financial Report Copies of the report were distributed to CRC members earlier. Mr. Staehler said they were trying to determine what the projected income would be from the TIF [approved earlier this year]. Mr. Roesch noted everything on this projection is in City Center. Mr. Staehler said it. includes parcel 98 also. LBSeI'rChC !JAN 11 1008 City of Carmel Mr. Staehler said the interest figures are estimates. The figures will have to be revised after tonight's invoices. Projections will change from month to month. Mr. Koven asked if these figures were being reconciled with the Clerk-Treasurer's figures. He asked why the 5200,000 [from AMLI] sitting in escrow does not show up on the report even though it's been in the Redevelopment fund since the day it was deposited several months ago. Discussion followed. Mr. Staehler will check on it. Mr. Koven asked that the Financial Report be included in the advance packets every month. Mr. Staehler said it would be. Attorney Report Mr. Haas reported he had only one action item: On the Old Town project. Jim Thomas from AMLI is reviewing his counsel's comments to the Project Agreement. Mr. Haas said he expected to have the Project Agreement ready for approval at the January CRC meeting. Mr. Staehler noted we need to get an arrangement formalized with Cripe so they can proceed. This is for engineering related items on Parcel 98. Mr. Haas noted that will be ready for the January meeting also. Mr. Koven said the CRC needs to have a contract with Mr. Haas also. This had been requested earlier and has not been completed. Mr: Haas said it would be available for review prior to the next meeting. Mr. Haas said the litigation on Sherwin Williams is proceeding apace; which means we'.re still in the same situation as before. "At any time the CRC could deposit the funds and SW would have to leave the premises. Or we could hold tight and my guess is it will be a number of months before this actually comes to trial." Mr. Roesch reminded Mr. Haas that any dollar figures being discussed should be saved for the Executive Session. Mr. Haas continued: "Conversations with counsel for Huffer, which is for the Goodyear premises, haven't produced any dollar figures to report. At the next meeting we'll be ready with the CSO contract. The only action item for tonight is the Ryland Letter of Intent extension. I received the Letter of Intent. I did not receive their check for $25,000. 1 think that was just an oversight. The basic terms of the extension of the Letter of Intent is that we would extend until January 26`h their"period for exclusive negotiations. We would expect to have a Project Agreement ready with them for approval at the next Commission meeting. In.exchange for extending the period of exclusive negotiations, Ryland will deposit a check for $25,000 earnest money and agree that their due diligence period has already commenced and will end on January 26'h. I would recommend that the CRC authorize Mr. Roesch to execute the extension of the Letter of Intent and that we hold it until we get the check from Ryland for $25,000." Mr. Haas thinks we will have a contract from them by the next meeting (January 10) or the one following that. Mr. Koven moved Mr. Roesch be given authority to execute the extension on the Letter of Intent from Ryland. Following a second by Ms. Snyder, the motion was unanimously approved. Mr. Haas estimates we will have funds from Ryland in March. Mr. Roesch asked Mr. Haas if he was aware of any agreement with First Indiana Bank about a swap of any property. Mr. Haas said he did not believe there was an agreement although there were discussions about a swap. There were contracts drafted, but none executed. Report from Architect Mr. Roesch said he had asked Mr. Olds what the infrastructure improvements were on the Duke project. Mr. Olds said he'd like to cover a couple of other items first. Mr. Olds reported the bidding for the Parcel #3 infrastructure work which was scheduled for December 10. Since the amount was estimated to be-more than 5150,000 we had to have wage rates. The City worked hard to get the individuals set up to get the wage rates and got it all done. Unfortunately we had to post a notice two weeks prior and we did not have enough time. We then extended the bid date to January 10. We had discussions with Mr. Kestner and there appeared to be no problems on his part since he does not plan to start construction till later in the year. Mr. Olds continued: We have been supplying Ryland Homes with information regarding Parcel 96. We have a board which outlines their plan and the amount of property they are wanting to buy minus the wetland area defined in Parcel #6 and minus the commercial space located on the comer. They've made some, modifications to their•site plan. That's in progress at this point. We will have to have legal descriptions rewritten for the site outlining all the separate parcels as part of the project agreement. This will probably be $250 to get a legal done for each of the sites. There will probably be three to four separate descriptions because of the way the ground's going to be broken up. Mr. Koven asked why the CRC was doing that. "Are we selling them a lot at a time or are we selling the entire thing and they're going to divide it?" Mr. Olds: One of the issues that came up was the fact that the Redevelopment Commission will still own the wetlands area. So we're going to have to cut out the wetlands area and define that which also will include extending it to the right of way line for City Center Drive and then carrying it over to the right of way line on Autumn Drive. Mr. Olds showed the site plan to the Commission. Mr. Haas pointed out that the wetlands covers areas both north and south of City Center Drive so it would be difficult to convey part of those wetlands because it may require that the permit be divided and a portion of the permit be assigned and assumed by someone else. "My guess is a developer would be disinclined to assume obligations under that wetlands permit because they involve performance by the Commission offsite [Because of the mitigation]." Mr. Koven: Is there any reason we're just finding this out tonight? I assumed when they were buying that parcel to develop that the wetlands was going with it. There was never anything brought up that we weren't going to be transferring the wetlands.. Mr. Roesch: We didn't bring that up but when we talked with them, Karl did bring up some of these problems. It is tied into the whole mitigation which includes Strawtown and ultimately can't we give this to the City? Or don't they want it either? Mr. Haas: It would be preferable if we could convey to someone else the title to these wetlands. Mr. Roesch: Why don't we investigate the possibilities before the next meeting? Mr. Koven: I just think there comes a time in the history of this Commission. that this Commission wants to walk away from the entire project and we don't want to be strapped to a wetland for how long? I don't want to have that liability out there. Mr. Roesch: At some point in time our work is going to be done. Mr. Olds: The last piece we.have is the review of the technical portions of Duke-Weeks' package that was put together for the TIF district and the infrastructure work at 96`h Street. We requested.to review the technical side of it and try to get it into a more concise format so the members of the CRC could look through it quickly and get a grasp of what was going on. A folder document assembled by Duke was given to each member of the CRC which outlines the various elements. CSO sent a cover letter to the CRC members of CSO's-review of the technical side of it only in terms of what Duke was doing, the amount of money they were spending and the scope of work. In reviewing the documents, the design and everything they're doing, the concept of the road improvements are in accordance with the traffic studies that were prepared. The work extends from the map, primarily going from the east side of the intersection of Meridian Street, moving west along the edge over to the adjacent Springmill Road. In terms of the 4 cost of the S6.9 million, we feel that it.is more than adequate to do the work they propose. We agree on the, breakdown of the costs for roadway improvements, the utilities, the landscaping, design services. The only issue we cannot address is the cost of the right of way. One. of the issues they are doing which we feel is extremely important, they are working with IPALCO to remove all the overhead lines along 96'h Street and bury them underground. However, one of the key elements in our talks we've had with them, is that Duke Weeks is requesting that the CRC allow them to act as the "construction manager". It's their belief that they can get the job done for less money than the $6.9 million by working with a series of contractors and people they've worked with before. They are also concerned with the timing because of the questions that have been raised and how long will it take for this work to be done. Everyone is asking when the work will start and when it will be completed, which is a critical piece. If this work is carried out by the Department of Public Works, it would go through a long drawn out process because we would have to go by the rules and regulations on each phase of the work. That's an important thing that the CRC needs to resolve, whether or not Duke Weeks could act as the "construction manager/design/build contractor". Mr. Roesch asked Mr. Olds if the inspections and so forth are still subject to all the approval of the City Engineer. Mr. Olds: They have selected a group of engineers which has been doing work for the City on a regular basis, top flight people who have reputations to uphold. I imagine the Department of Public Works would still carry on their normal inspection process as they've been doing on most of the projects that we've been involved with. They hire a separate inspector to observe and make sure everything is being carried out according to the contract documents. Mr. Staehler: I think it needs to start before inspection. There needs to be a thorough design review of what they propose and that needs to be done by the City. There's more to projects than just inspections. Mr. Roesch: Is it common to do this? Mr. Olds: Yes, it's done quite often. The City of Indianapolis does it on a regular basis. Mr. Roesch: Is it your recommendation, Les, that we consider that? Mr. Olds: It is my recommendation that you strongly consider that, considering the timing schedule and the amount of disruption that could occur. It would be our recommendation in terms of the cost savings and speeding up the schedule. Mr. Roesch: Are all of these items offsite items? Mr. Olds: If you look at the map all the infrastructure work occurs within the green area. It's the road system itself and adjacencies to it. Most everything is being done on the right of way. If you'll notice there is no additional right of way being taken on the south side of 96`h Street, with all the new right of way and all the majority of the work being carried on on the north side of 96`h Street especially from Meridian over to Springmill. Mr. Staehler: If this is such a good deal, then Duke Weeks ought to be willing to pay the costs of in-house design review and also our inspection costs. Mr. Koven: I think any costs related to this are going to be theirs. It's their project. They've identified the specifications. They've identified the plans. They've asked us to approve and give them special consideration as a TIF district. Mr. Olds: These improvements are needed based on the future anticipated traffic that's going to be occurring. This is an opportunity for the City to get the work done at no additional taxpayer cost since Duke is putting up all the costs including the bond interest should the project not move forward and they are guaranteeing it. Mr. Koven: That's partially true, but not completely true because the taxpayers are going to be paying part of this. Because in fact the amount of money that we derive from the TIF up and above its tax rate at this point in time is money that would normally be going to the City but will be going to retire bonds. The amount of money that's being spent in this TIF district for infrastructure, for such things as landscaping, which is solely for the benefit of their building and the people that are occupying their building. And their ability to lease their building should not be borne by the taxpayers of the City of Carmel. There's other things on here I'd like to get into a little deeper, but I didn't think we wanted to do that tonight, but roadway improvements and some of these are in on their property, not out on 96`h Street. And I don't think the taxpayers of the City of Carmel should be burdened with the lost revenue from that additional tax money to be retiring bonds that are strictly for the benefit of Duke Weeks and this Parkwood development. So there is a cost to the taxpayers. Mr. Olds:I stand corrected Mr. Roesch: The TIF revenue probably will grow well beyond what it is initially but we don't know that for sure. Ms. Snyder: How long is this projected to be? How can it be extended, if the project isn't cash flowing? How many extensions could there possibly be until we begin getting tax. revenue back here? Ms. Lee: There are two questions. Number one, the TIF area could be in effect for a maximum of thirty years by statute. As far.as the term of the bonds, that would be the financial advisor and the Commission's decision based on how much tax increment is available, how much the projects cost. Mr. Olds: These are the needs that are going to occur in the future. Reports from CRC Members Mr. Koven: This is the first TIF I'm going through as a member of the Redevelopment Commission and as a member of the City Council. We've already had a couple of things that are going to come to bear on the Council and are going to come to bear on the Redevelopment Commission later this evening on our, invoices for approval. Somebody needs to tell us if this is legal or not... I think from here on out, when we get involved in a situation where we have somebody who is petitioning us to setup a TIF district, I think we ought to enter into some kind of agreement with them on the front end that they absorb any and all costs related to that and they actually put a deposit down at the time like earnest money to cover their costs in advance. Because we're looking at invoices which we're being asked to pay here for a project in which they have assured us they're going to pay all the costs. My approach to a TIF district is if you want that TIF revenue, you are going to pay those costs. It's not going to be an expense to the City or to the Redevelopment Commission. I don't think Duke Weeks is going to walk away from this, but I don't want to be paying that money and I think there should be some sort of deposit toward expenses. At the time when they first approach us with this we enter into a. contract and it says what that money is to be used for and we use their money to pay the bills, not our money. Is that something we can legally do? If so, I'd like to have that policy put in place, subject to.the approval of the rest of the Commission. Mr. Roesch: We did. setthat precedent with Duke Weeks. Perhaps we need to adopt that as standard procedure. Mr. Staehler: I think we need clearer definition of the rules because it's going to be awful difficult for us to figure out what bills are paid by whom. We've got some tonight that will be questioned and I don't understand based on what I've heard here tonight who's really responsible. Mr. Roesch: We are paying for past sins when we had various City departments getting these things started before we'were even aware of them. I know it's confusing but we've got to work through it. We are establishing some of these procedures. With the agreement that was signed with Duke Weeks that did set a precedent that we haven't done before. Mr. Koven: What I'm getting at is all of the expenses, even the ones we expend on our behalf through Karl or through Les should all be part and parcel of the expenses and not expenses of this Commission. Mr. Staehler: Perhaps Karl would like to comment on that. Mr. Haas: The agreement we have in place with Duke is that they will pay for the special consultants that the Commission hires and that would include sub-consultants of those P consultants, so it was Wabash Scientific, Umbaugh, and Ice Miller. I've recommended that Les work as a sub-consultant to Umbaugh and the agreement then would cover those expenses. At the meeting when the idea was brought up requiring Duke to post an earnest money deposit and it didn't come to motion, but that is not part of the agreement. On a going forth basis, it's a good idea. There's no reason we can't do that. All of these expenses, presuming the bonds are issued, would be reimbursable to Duke Weeks out of the bond proceeds. So there would still be a cost to the taxpayer in that way and this was also discussed at that meeting. Mr. Koven: I just don't think a TIF should have a cost to the taxpayer period. The land's fine as it is, if you want to build something there. You want us to take the steps of getting involved in bonds and everything else. I mean I have to come and volunteer my time and sit through a meeting and deal with it. I don't get paid for it. But I don't think it should be an expense to our taxpayers out there. I think anything relating to those TIFs.should be paid for by those people. Mr. Koven continued: These expenses that are coming in, we had a couple of major ones on the City Council docket Monday night. We just said, "We aren't paying them." And how they're going to be paid when they're billed to the City of Carmel, I don't know. There's not a process in place that I know about to do that. I don't think earnest money is the right term because we're going to spend that money. We're going to pay all the bills related to that out of that fund. They're going to geta full accounting and all the invoices of where it's going. We need to be able to pay them as they come due. Mr. Haas: I understand what you're proposing is the idea of a TIF retainer and you could apply that to paying the costs. There shouldn't be any reason why these bills are coming to the City of Carmel. They all ought to be coming to the Commission. Mr. Koven: I think some of them are from Barnes and Thornburg, legal expense, which carne through the Mayor's office. The billable on those invoices related to discussions through the Mayor's office, not through the Redevelopment Commission. We should clearly identify with somebody when they're dealing with them that it should be set up as a separate invoice which has been done this time. You've already got a whole bunch of invoices related to the TIF district on.tonight's claims for us which I'm not going to pay. Mr. Roesch: I would differ a little bit about it, being the taxpayers that pay for it if it gets done. I think what we're doing with these projects is creating additional revenues which we wouldn't have. Mr. Koven: Today, but they're not the only ones that could buy or develop that parcel of land. There's a lot of bare property sitting around in Carmel that somebody is going to build on and they may or may not seek TIF financing to do it. If they do, it should be under a specific guideline that is set out by the CRC of how we're going to proceed. so we're not treating anyone differently from another. It should be a set policy and that's the way we handle it. But right now we don't have a TIF policy in this city. Mr. Roesch agreed. Mr. Koven said to Mr. Haas, "There's your marching orders." Mr. Roesch asked Mr. Koven if he and Mr. Haas would like to get together and propose some procedures for the CRC to adopt. Mr. Koven: I think the appropriate thing would be for us to adopt a resolution and put it on the record and from here on out that would be the policy. Mr. Haas said he would have a resolution prepared for the next meeting, working with Mr. Koven. Ms. Snyder: When all is said and done, and a project shakes out, we have to prove to the taxpayers that we had a dam good reason for allowing a TIF to be created and that we have added value for them and eventually they will get increased tax revenues. And we depend upon our bond counsel to be able to prove that to us. Quite frankly, if the land ought to remain fallow then that may be the answer to some-projects. Hopefully, not this one. Approval of Invoices Mr. Koven noted the new invoices received almost doubled from last week's total. Ms. Snyder asked if the CRC was expected to pay the two Umbaugh invoices for Merchants Square TLF or would those be paid by Linder. Mr. Roesch, noting he had talked with Loren Matthes about the invoices, said these were items that they were asked to do in connection with the Merchants Square TIF. They were told there was probably going to be another TIF and that they should just put these invoices in the next TIF. "I did not think that was appropriate since they were not working on the next TIF anyway. Besides, it's inappropriate to shuffle things from one pocket to another. They need to be placed so the world knows what the expenses were incurred for." Loren asked me about those things and I said, "You obviously did the work, you should get paid." I asked her to submit these bills. In looking at the detail, I see some of them were for the Merchants Square TIF. Some of them were before we "put the skids on all expenditures" by everybody authorizing contracts. Some of these things were for another project across the street, potentially, Merchants Pointe. However, they were done before we established the procedure to look at these things. They were done supposedly on our behalf. I do think they should be paid. Mr. Roesch continued: I also noticed the same thing happened on Juday Appraisal Services. There was some work done before apparently we passed a resolution saying don't do anything without our approval. Then they were told to stop at some point in time. Mr. Koven: I have some real questions about the Juday Appraisal Services invoice. Why is that a Redevelopment Commission expense, not the Mayor's office. I believe it was the Mayor's wild idea to conceive of these appraisals. The CRC to the best of my knowledge, was never consulted or brought into the loop that we were going to go out and appraise these properties at all. Mr. Staehler: It is my understanding that there was a resolution that authorized some research or looking at some of the areas downtown. This involved the block north of Parcel 48 and another parcel at Rangeline and Main Street; the southeast quadrant there. Mr. Roesch: I'm not aware of any resolution that was passed. [Mr. Koven agreed.]. This goes back to the time, I guess the excuse that was given was "we talked about it in the minutes, we're looking at this" and that's the excuse used for the authorization. The bad thing in some of these cases (and I hope at one of these meetings we're going to see the end of these things) is that people did perform work. Mr. Koven: I don't think there's any question that somebody did.perform work and somebody's due to be paid. The big question is which pocket does it come out of? I did talk to Mr. Juday this morning about this since I've known him for 25 years. I asked him who initiated the contact and he did share with me that it was Joe Staehler. I guess I need to put Joe on the spot and ask, "Where did that authorization come to you (because you were not our director at that point in time)?" I suspect I know, but I'm going to ask. Mr. Staehler. From the Mayor Mr. Koven: That's what I thought Mr. Staehler: But Mr. Juday was also told to stop immediately upon finding out that you all weren't wanting to proceed along that road. Mr. Koven: I guess this goes back to the situation where the Mayor thought our funds were his funds. While I don't deny that we probably do owe Jeff Juday these fees for these partial appraisals, which, is, for the record $4,925.00 for partial payment on two invoices, neither one were completed. One of them was to have been $8,000. The other one was to be $8,500. So we're going to pay $4,925 toward two appraisals for which contracts were issued, by the way, by the City, not by the Redevelopment Commission, in the amount of $16,500. Well, that maybe fine, but the Redevelopment Commission is a legally separate body and I suspect that these were approved by the Board of Public Works. I say we don't pay it and we send them back to BPW and let them figure out how to pay it. That's my motion. Following a second by Ms. Snyder, the motion was unanimously approved. Mr..Koven: For the record, the next invoice, actually three separate invoices in the amount of $1500 apiece, which we are being ordered to pay the Clerk of Hamilton County Superior Court are for the court ordered appraisal services on the Sherwin 10 Williams property. Just so everybody out there knows, we're paying $4,500 of our money to three different people on.the Sherwin Williams lease, of which only one of those people is a certified appraiser, by the way. Mr. Roesch: I think they are appraisers, but I don't think they are certified commercial appraisers. They're not MIAs. Lthink two of them, are residential. [Inaudible.] Mr. Koven: Moving down to the second invoice we have from Wallack, Somers & Haas, Invoice 95703 in the amount of $2,906.25 is professional services as it relates.to this TIF district that we're talking about this evening. And I would make the claim that I don't think that's ours to have to pay. Mr. Haas: I'll be glad to defer that until the bonds are issued. Mr. Koven: Okay. That works. The next one I have a concern about is to Wallack, Somers & Haas in the amount of $14,596.20, Invoice 45704. I have a problem with it because of the reference on down through there with regard to luncheons, meeting preparation and sending of emails. If it's,going to cost me to have emails sent to me (which I don't want.to read in the first place), I would just as soon save the expense and not receive email. There's an awful lot of that down through here and there's a number of meetings that were conducted over luncheons. Looking at his fee and I'm assuming becausewe don't have a contract, that any time I see a one hour and a $225, I assume that's our hourly rate. Mr. Haas: That's correct. Mr. Koven: On November 8th it cost us $337.50 for him to prepare to attend a Commission meeting. I spend that much time, too, but I do it for free. I don't expect him to do it for free, but there's an awful lot of preparation time on these invoices. That's why I think we need to have a contract that spells out.exactly what we're going to pay for and what we're not going to pay for. Mr. Roesch: I. agree, John, but I think there is a lot of preparation that has to be done before these meetings. I frankly do call Karl periodically before these meetings and say, "I'd like you to be prepared to talk about this or that." Mr. Koven: Okay. Well, I read through them. I didn't have a problem with the whole thing but there's an awful lot of repetitious stuff that jumps out at you. The next one I have is also with Wallack, Somers and Haas, Invoice 45711, and I found it very disturbing to me but we're being asked to pay $5,812.50 as it relates to the CRC dealing with our contract with CSO. So we're paying you $5800 to help us negotiate our contract with him [Les Olds] so he can turn around and charge us for somewhere in the neighborhood of,S23,000 in invoices. I would suggest that those expenses for you to deal 11 with his contract, if he's asked you to do that, they ought to be his expenses much like I expect the TIF expenses to be the TIT applicant's expenses. Mr. Roesch: We did ask him to look into a contract with CSO. Mr. Haas: John, there are also a number of other contractural items on that bill. Mr. Koven: I don't question that there are a number of other items, but CSO jumps out in capital letters in every other line though here. There's a signifcant amount on this that deals with your dealing with contract obligations with CSO. When we originally talked about having these contracts, we asked CSO to bring us a contract. We still don't have a contract with CSO. So we've got a bill for $5,812 and we.still don't even have what we want. And had I known it was going to cost us $5,000 to do that I would have said to Les, "You go get the contract." I don't see why we're spending any of our money to deal with contracts that already have been negotiated with BPW and we're just really saying if you want to do business with us, bring that contract here. Mr. Roesch asked Mr. Haas if this is difficult to unwind, switching the contract from one entity to the other. Mr. Haas: The contract was with BPW and needs to be divided into two portions. So the work was on the contract that was not being performed for the Commission and work being performed for.the Commission. So the terms of the contract itself had to be divided, too, as did the work to be performed under that contract..so you end up in effect with turning one contract into two, each contract covering the correct work to be performed for the different entities. Mr. Koven: I have no question about that. That's exactly what we wanted done, but I don't know why it should be my expense as a CRC member to bear the expense to separate those two. I didn't create that problem. I merely said to him, "If you want to get paid by us, you need to bring us a contract or we're not going to pay you." I didn't authorize us to spend $6,000 to get it done. It's a business decision that should.be made by CSO Architects, not by the Cannel Redevelopment Commission. I don't know how we're going to go about doing this because I've got sotne of these claims I want to vote for and some I want to vote against. Mr. Roesch: From my point of view we're unwinding and it's a darn shame. Ms. Snyder: It was a mess that was created for us by the Mayor. On the other hand, we've asked for contracts and don't have them yet. So I think we should suspend payment until we get a contract. And I bet we'll have them by the next meeting. Mr. Koven: For the record here, we are faced with invoices, had we met last week on December 13`h, we were presented with maybe ten or twelve invoices, of which all but one were from legal firms, the total amount of the claims was $87,371.37, of which $61,733.70 was billed by Wallack, Somers and Haas; our own legal counsel. We had 12 $14,200.61 by Baker and Daniels as. it related to the wetlands-And that's not all of the cost of the wetlands. You never know with law firms. They could still be billing us six months from now for wetlands stuff that keeps showing up. We havea bill for Ice Miller Donadio and Ryan for $2,012.06 so to make it real brief, out of $87,371, $77,946 is going to attorneys. We had this.discussion at our Council meeting Monday night, but everybody seems to think that Carmel is just awash with money and we just pay exorbitant amounts of monies to consultants and attorneys. And it is just absolutely appalling when we're trying to develop a City center project over here that we have these kind of expenses that we can't use for development and improvements of the land to get these projects going. Now that we've finally closed with AMLI and we're wealthy again, except all that money is committed. If we keep whittling away this money the way we're doing it, we're not going to be able to complete some of the projects that we've already made commitments to complete because these guys are getting in line first. And I don't fault them for that because they've been holding invoices. But we as a Commission have no idea how many other invoices are still out there. I was informed today by Jeff Juday, just kind of an FYI from him to me, that there is another appraiser who was actually going down the same path he was, so that we were going to get two sets of appraisals on this and he has yet to bill us. Where he is in the mix, I don't really know. There comes a point in time you want to say, "Stop! I want to know who I owe money to." And we don't know. We still don't have a firm handle on our financial situation as a Commission. And I find this just absolutely appalling and I'm considering that I'm not going to be here on this Commission next year unless we get our hands on it. Ijust don't want to be a part of this. Mr. Roesch: I think that's what we're all trying to do, John, is get control Mr. Koven: But we're not doing it. We've asked for contracts. We don't have them. We're still paying bills. We were supposed to issue purchase orders for everything we're. doing. We have yet to even order them. Mr. Koven continued: The add on claims, we've already talked about the invoices from H J. Umbaugh and Associates. My question with regard to those was shouldn't they be paid for by the recipient or the benefactor of the old TIP But I guess the answer to that is no. But I would suggest that whatever agreement you [indicating Mr. Haas] bring to me, it's from the time that the bonds are issued until the bonds are retired, any expenses related to that TIF are going to be theirs. We're squandering $78,000 on a TlT that closed four or five years ago and we're still paying and I'm sure we haven't received any revenue from it yet. So we're going deeper in the hole. We're still sliding. Mr. Roesch: I think that's why they were asked to put it somewhere else. Mr. Koven: Now I'll pick on our other vendor who has found this opportunity to pounce on us tonight and I don't regret it, that's CSO Architects. Their invoice 918377, dated 9/8/2000 on project #11. We have an invoice where we're being asked to pay $3,000 for fees as it relates to an underground garage. I don't know that we've ever authorized anybody to spend any money to do design work or anything else for an underground 13 garage that conceptually may be part of City Center if we ever geta group of developers who want to start developing it, but in the meantime we have a bill here toward it. Mr. Roesch: I believe that was authorized a long time ago. Mr. Olds: That included updating the master plan which included Parcel 47, which was the retail area. It was also to establish the garage. elevations with regard to the drainage that was part of the master plan drainage program that was being carried on and how we were going to handle the drainage and the piping. We had to establish certain levels and elevations that we needed for part of the elevation work. If you look at the original contract there was approximately $20,000 authorized for the study of the garage area and updating of the master plan. Mr. Koven: I don't question your expenditure. I question the timing of it. We've never seen those contracts. They're not with the Redevelopment Commission. Maybe this ought to be one that goes back to BPW and let them pay it, too. Mr. Roesch: I think when we look at CSO's contracts at the next meeting, that's going to lay it all out for us. Mr. Koven: I sure hope so. Ms. Snyder: Again, I really think that we have two consultants with whom we do not have a contract. Do we have a contract with Wabash Scientific? [Affirmative.] So we can pay that and obviously the utility bills. Mr. Koven: But Wabash Scientific shouldn't be ours, because that was a TIF expenditure Ms. Snyder: So that will go back to Duke. I think we should go through these and decide which ones we're going to pay, which ones we're going to send elsewhere, and which ones we will suspend until the next meeting when we have a contract. Mr. Koven: Well, let me have my last comment. The next invoice is from CSO Architects, also, their invoice # 18378, dated 9/18/2000, for $36,400 on Project 22 which is a performing arts center. I am absolutely outside of my skin over this. We aren't going to build that damn thing and if we do, it will be the last thing we build and how can we be incurring, and I know what's it's for, it's when we brought these acoustical people in here to do that, which was a dog ahead of its leash, too, but for the record, we're paying 536,400 of our money towards the conceptual acoustical marketing plan of a performing arts center. It was authorized by the Mayor. It was not authorized by the Commission. A presentation was made to this Commission, but had I known we were going to spend 536,000 to have this presentation made, it never, ever, ever would have happened, nor would I have been here to see it. We've got some serious problems here, folks. We are out of control and this needs to be hammered down now. Mr. Roesch: This isn't just for the presentation 14 Mr. Koven: Oh, yes, it is. Mr. Olds: This was for the work in terms of the original programming to establish the overall size and scope for the project. It included them coming to town and spending a week here meeting with all the anticipated users to develop the program. CSO has paid that invoice to those people. Mr. Koven: I'm well aware of that. Your copies are included here. It was to Artec Consultants, 640 Fifth Avenue, New York, New York. These people are so sophisticated you can't send them a check. You have to remit wire funds. The total due on the first invoice they have submitted to us is $36,800 which is continuing professional services, including a programming report. Then they had other expenses for print reproduction, long distance postage for $270.22. That's all the performing arts center and it has to do with that presentation that night. There's nothing in here about anything else having been performed by CSO Architects as it relates to that. It is reimbursement to CSO for expenses that they incurred for Artec. Ms. Snyder: Is this part of the $260,000 contract for the performing arts center? [Affirmative] The contract that was approved through the Board of Public Works? [Affirmative] We had mentioned two or three months ago when we were setting up our own system here that we're not going to honor that contract. I was at this meeting because most of the Council was here listening to this Artec presentation. And the Mayor got them in and often when people come in to see if there's business for them, they tell us who they are, we think about whether we're going to use them and either we do or we don't. But no mention was made, "By the way, folks, we're going to come in and we're going to tell you what we can do for you and we're going to charge you $36,000 for the privilege to do that" because they had talked about taking surveys and talked about the general area of the greater community and we all nodded our heads about this and they went on their way. And suddenly we've got a bill that you had to pay on our behalf because somebody authorized it. Mr. Koven: And that somebody was? Mr. Olds: The Mayor. Ms. Snyder: The Mayor. Mr. Koven: That's where it's going. Mr. Olds: The ongoing bills that you have before you are for the site engineering and ongoing engineering work that's going on for the various parcels. Mr. Koven: I might spell out here for the record, the invoice we're talking about here is Project #22, identified in CSO's contract with the Board of Public Works, is for the Carmel,City Performing Arts Center. It was a $260,000 contract and with the inclusion of 15 this invoice, we have paid out 54% of the contract, and I'm assuming everybody in this room knows where this ground is. We will have expended $140,400 on a performing arts center that still probably could classify as a wetland if we didn't mow the weeds that were over there. We spent $140,000 out of a $260,000 contract and all we have is a sign in the yard. I rest my case. Mr. Roesch: You're really talking about the one invoice on CSO? Mr.`Koven: Yes, number 18378. Ms. Snyder: We recommend that go back to the Mayor. And the Juday appraisal invoice goes to the Board of Public Works. And the balance of the CSO and the Wallack, Somers & Haas be suspended until we get a contract in place. Mr. Roesch: I would rather see them get paid. [Mr. Koven agreed.] Ms. Snyder: In the spirit of the season? Mr. Roesch: No, I really think they have served our interests. I think they were receiving some bad signals and so forth. I don't think they should suffer because of that. Ms. Snyder: Okay, so we'll pay them. And Wabash Scientific's contract? Bill amount of $8,500. Mr. Koven: I would defer to legal counsel? How are we handling those? I don't want to spend it and then get reimbursed. Mr. Haas: I think that should be paid out of the bond closing proceeds or paid by Duke in the event there isn't a bond closing. Ms. Snyder: And the same with the lee Miller bill? Mr. Haas: That's correct. Mr. Roesch: You think we should go ahead and pay those at this point? Mr. Haas: No, I think those should be deferred. Mr. Koven: But are we being fair to the vendor? Did Wabash Scientific enter into an agreement with this understanding he wouldn't be paid till sometime down the road? That's why I think we should have a TIF retainer. So we can pay these people in a proper and orderly manner. Mr. Roesch: I think you pointed out the need for that, John. This is evidence of that. Wabash Scientific has done most of their work obviously. 16 Ms. Lee: With respect to our bill in there, my understanding is that has to do with an arbitrage rebate calculation on some old outstanding bonds. It is not involving this particular TIF issue. Any bills from us involving this TIF issue would be billed to the bond proceeds. Mr. Roesch: As a matter of fact, I'm not so sure this bill was not already paid. Joe, you might want to check info the Ice Miller bill. I believe that's one we,authorized to be paid several meetings ago. I believe it was paid, but I believe the City Attorney at one point in time was questioning that. Mr. Koven: And let's say if it's not paid, we'll include it to be paid. I don't want to delay it. So we're stating that the invoice for Juday appraisal services in the amount of $4,925 be sent back to BPW from where it originated. The CSO invoice #18378 in the amount of $36,400 be sent back to the Mayor. Aside from that I would make a motion that we pay the rest of the claims. Following a second from Ms. Snyder, the motion was unanimously approved after Mr. Koven clarified that the Wabash Scientific invoice would also be included in the invoices not be paid.by CRC. Mr. Koven: I want to ask Les and Karl: Are you still holding anything else? Mr. Haas: For my part, I believe the bills are current through November 15`h. Mr. Koven: What I'm trying to determine is, who do we still owe money to that we don't know about. And so I'd like the minutes of our meeting to reflect that we are current with CSO and we are current with Wallack, Somers & Haas. There's no outstanding invoices being held or anything like that. Mr, Haas: I think [ours are current] through the 151h. So far as I'm aware the invoices.if these are paid.would be paid current. Mr. Roesch: It's important to get Les's contract in'because we're going to have to have some discussions about this contract that started quite, some time ago with the Board of Public Works, is really a Redevelopment Commission project. However I don't think we realized how far it had gone. In Les's case this contract originated three years ago and so this is a problem we're going to have to unwind and it points out the importance of that contract. Old Business Mr. Roesch: Lisa Lee is here tonight to talk about the Duke Weeks schedule and answer questions for us about.how the process on this particular TIF will work. Time tables from Ice Miller were distributed. 17 Ms. Lee: I was asked to briefly go through the process that the Commission would have to go through in order to create an economic development area, otherwise known as a T3F district and talk about the different entities or different parts of government that have to approve certain portions of the area. Ms. Lee continued: The first step really is to establish the base assessment date for the TIF area which is the date by which the assessed value is abase or frozen if you want to think of it that way. So each subsequent March I st when that land or those improvements are assessed, the assessed value is higher in subsequent assessments. And that increase in the assessed value is multiplied by your tax rate and that becomes tax increment revenue. So that's where TIF revenue comes from. So it's important that we establish that first base assessment date and in order to do that, the Redevelopment Commission has to adopt what is called a Declaratory Resolution. That Declaratory Resolution has attached to it an economic development plan that sets forth the Redevelopment Commission's plans for that area. It also sets forth a factual report to support the statutory findings that the Commission has to be able to make in order to create a TIF area. Once you adopt that, that is the time that sets your base assessment date. So you have to adopt that by February 28, 2001, in order to have a base assessment date for this particular area of March 1, 2000. So the March 1, 2000, assessment would be the base. All subsequent assessments would be increment or an increase in that assessed value. So that is the number one date. Once that resolution and plan are adopted by the Redevelopment Commission it goes to the Carmel Clay Plan Commission. The Plan Commission looks at the plan and the resolution and determines whether it conforms to the overall Comprehensive Plan for the City. If they adopt an order to that effect, it then goes to the Common Council and the Council adopts a resolution approving the Plan Commission order. At that point, we get into what we would consider more of the public notice, public hearing stage. The Redevelopment Commission has to publish notice of a public hearing to be held in front of the Redevelopment Commission. That notice has to be published at least ten days prior to the public hearing and at the same time, a tax impact statement has to be filed with all the underlying taxing units that would be affected by this area and that is something that is provided by the financial advisor. That also has to be provided to those units at least ten days prior to the public hearing. You then hold.a public hearing in front of the Redevelopment Commission. At that time following the public hearing the Redevelopment Commission can either adopt a resolution that either modifies the original Declaratory Resolution, confirms it as it stands, or rescinds it. So the area, even though you have established the base assessment date with your first action, the area is not created until the final public hearing is held and the Redevelopment Commission adopts the Confirmatory Resolution and then there is one more step in an area of this type. it goes back to the Common Council to approve creation of the overall area. 18 So there are a number of steps in this process in front of the public where the public has an opportunity for input. And different governmental bodies of the City also have input into the process. That is in general a quick overview of the creation of the area process. It is my understanding at this point it is premature to discuss any kind of financing structure because there are a number of issues that are outstanding. There have been no negotiations. Those are things that need to be discussed and undertaken in the future. Questions? Mr. Roesch: Actually there will be negotiations going on through this process. If we would adopt the Declaratory Resolution on January 10, we still are not past the point of no return actually as a Commission. And it also has some hurdles after that with the Common Council. [Ms. Lee: That is correct.] But we're not past the point of no return until after March 5 when we would adopt the Confirmatory Resolution. That is the point when any remonstrations would come into play. Ms. Lee: Correct. Mr. Koven: Back on your January I Oth date with the Redevelopment Commission adopting a Declaratory Resolution, that March I" date, does that talk about determining the base assessment as of that date? Does that mean the assessor has the right to go out and assess it on the 281h and change the assessment prior to that or would that be the assessment that's been in effect.for the last year? Once they realize that the value of the land's going up, they can certainly go out and change their assessment. Ms. Lee: They can certainly.do that, but per statute and per regulations of the State Board of Tax Commissioners, as long as you have adopted a Declaratory Resolution, prior to the next March l assessment, then your base assessment date reverts back to the previous March 1 assessment. Ms. Lee continued: You have plenty of time as far as this process goes. Now that's not to take in the process that they're under or the time schedule that they're looking for. But as far as getting your base assessment date, as long as you do it by February 28, you're okay. Mr. Roesch asked Peter Miller, counsel for Duke Weeks, if they had seen the schedule. Mr. Miller: We had a chance to review it briefly. I had two questions. One of them was whether the Council will be likely to' follow the process of referral to a Committee. I didn't see that on the schedule and I didn't want to lose time because of a process which we need to account for. Mr. Koven: I can address that. It's automatic. Our Ordinance does not allow us, unless we suspend the rules, which requires unanimous approval of the Council, which we've not been very lucky at trying to achieve. I think we probably need to allow for the fact 19 that this will go to a Council Committee. It could go to Land Use/Annexation and Financing, maybe a joint committee meeting. Ms. Snyder: Or even Economic Development. They could all meet. They could call a special session. If there was a time crunch it would not be unlikely that although the Council would automatically refer it to committee or joint committees, that they could call a special session to address it. And I wouldn't see a:problem in doing that just to make sure that we hit all the dates. Ms. Lee: As far as what the Council has to do in this process, it's by resolution. It's not by an ordinance, so statutorily it doesn't have to go into two meetings with suspension of the rules. It's a purely local decision on how that's handled. I didn't want you to confuse a resolution with an ordinance. They wouldn't have to suspend the rules to adopt a resolution in one meeting. Mr. Miller: That sounds like something that can be addressed when we come to it. For my second question, I'll yield the microphone.to Chris Seger, Duke Weeks, to talk about the questions he has regarding the timing of this. Mr. Seger: This schedule works for us. There's been a lot of comment about what can and cannot be-included in the infrastructure budget and it's really a business decision with Duke Weeks and also with the City of Carmel. We'd like to see those conversations happen sooner rather than later. We've mentioned our contract contingencies for the TIF. We have big economic consequences. The cost of development of this site is substantially higher than any other site anywhere we've dealt with. So we would propose to have that sooner rather than later because we're not into wasting anybody's time. We wouldn't want to go through this whole process and then sometime in late January or early February come to the understanding that the amount of money that's available for the project doesn't work for us and doesn't work for you. And we don't think that's appropriate. Mr. Roesch: I hear you, Chris, and we probably will be discussing these things at the January 10`h meeting and prior to that, items or questions that may come up from Commission members and'we'll certainly get them to you. We'll be discussing them publicly, of course, on January I0`h. Part of this also is going to be financially driven, too. It becomes an issue how much TIF is available. [Mr. Roesch asked Loren Matthes for her input.] Ms. Matthes: We had a meeting yesterday with Duke Weeks to go over some.of the square footage numbers and get clarification on the parking structure and things like that. So we are revising the numbers that we already ran preliminarily. We actually have several financing options but we will need to be discussing those with the Redevelopment Commission because there are different options.we can choose. And I don't know when or how you'd like to do that... if you want to do that in an Executive Session or just share information gradually? We had talked about some small briefings. 20 Brief discussion followed Mr. Haas: At this point, we ought to agree, at least for this evening, that information would be directed through Ice Miller and then distributed to you under the attorney/client work privilege. Mr. Seger: What exactly will happen on the 10`h? Mr. Roesch: That actually would get everything going and set the stage so we can. capture that TIF by March I". W. Seger: So it would be your intent to have conversations about what would be included in the TIF after that point in time and not at that particular meeting. I think that's what I heard, but I want to make sure. Mr. Roesch: I would really like to discuss at that particular meeting as much as possible what could be included in that TIF so that we all know... it's not,absolutely necessary, Ms. Lee, that we do, but something of this size, if we can focus on this thing and reach agreement, then I think sooner better than later. Mr. Seger: One thing I should mention to you, given the magnitude of this, I do not have the complete authority and so if it gets into the 10`h and it's substantially different than what we anticipated, this is something that does require board of director approval from Duke Weeks. I just want to make sure everybody's aware of that.up front. Mr. Roesch: I don't think that is a problem. As I said earlier we're not passing the point of no return until we get actually to the March 5`h meeting. I would say by March 5`h you should have your board together. Mr. Seger: We anticipate, based upon the IO'h, finding out what are the thoughts of. the Redevelopment Commission, determining if it can or cannot work and making a very quick decision if we want to continue to proceed. Mr. Roesch: Good. I think we're.together on that. Any other discussion on the Duke Weeks project or any other questions for the vendors? Miscellaneous Old Business Mr. Roesch: Joe, you were going to check on the rent payments from the City for the yellow building. Mr. Staehler: Yes, it is the understanding of the Utilities Department and the Street Department that they would not be paying any rent after the building was purchased. They were doing this on an interim basis to. secure the deal. New Business 21 Mr. Roesch: Amy asked me to ask who the Carmel Civic Square Building Corporation was. Mr. Staehler: I sent her the list of board members. They are strictly a Commission that administers the mortgage and lease of this building. That has nothing to do with the CRC. There being no other new business, Mr. Koven moved the meeting be adjourned. Following a second by Ms. Snyder, the motion was unanimously approved and the meeting was adjourned at 9 p.m. z\redevcomm\2000.Dec 20 Minutes.doc 22