HomeMy WebLinkAboutMinutes CRC 10-15-08 CRC Meeting, October 15, 2008A�t
CARMEL REDEVELOPMENT COMMISSION Meeting, Wed c. clay,
October 15, 2008 i N d9 24 1
Does t
President Ron Carter called the meeting to order at 6:33 p.m. Commissione bers
Rick Sharp, Carolyn Anker, Jeff Worrell, Bill Hammer and Stephen Backer w �1..
constituting a quorum. Also present were Mayor Brainard, Karl Haas, Les Olds, -4 .2- 4 1 1
Mielke, Andrea Stumpf and Matt Worthley.
Others present:
From CSO: Dan Moriarity, Brandon Bogan
Keystone Construction: Joe Pieters
Other members of the public or media: Bruce Donaldson, Rich Starkey, Jason Semler,
Rick Osborne, Tony Eisenhut, Steve Pittman, Paul Rioux, Kevin Rider, Nancy Heck,
Luci Snyder, Tom Pitman, Melanie Hayes, Mark Worthley, Nancy Worthley
Approval of Minutes
September 15, 2008 Transferred to November CRC meeting for approval due to lack of
proper motion.
September 17, 2008 Moved for, approval by Ms. Anker, seconded by Mr. Worrell and
unanimously approved.
September 18, 2008 Moved for approval by Mr. Hammer, seconded by Ms. Anker and
passed with an abstention from Mr. Worrell.
Financial Matters
Ms. Mielke reported the September end of month operating balance is $6,758,429. The
CRC has received no notification from Hamilton County regarding an estimated date for
the second TIF distribution. All indications show the November tax bills are being sent
on time.
Ms. Mielke requested the Commission's approval to pay invoices from the CRC General.
Fund in the amount of $785,985.39. Mr. Hammer moved for approval, seconded by Mr.
Sharp and unanimously approved.
Ms. Mielke requested the approval of the Disbursement of Funds from the PAC
Construction Fund in the amount of $2,104,377.76. Mr. Worrell moved for approval,
seconded by Ms. Anker and unanimously approved.
Mayor Brainard made a presentation regarding cost escalations for the Performing Arts
Center (PAC). [Please see attached presentation print out]. Mayor Brainard explained
the TIF revenues received have far exceeded the forecasted amounts. In December of
2005, the estimated surplus TIF for 2008 was an estimated $18 million. For October
2008, the estimated surplus TIF for the life of the project is now just over $148 million
which equals a 732% increase. The estimated TIF revenue received is 73% higher than
estimated in the December 2005 forecast.
1
CRC Meeting, October 15, 2008
However, costs for the PAC have escalated due to an increase in material and
construction costs. The cost of materials used for construction has risen faster (30.2
than the consumer price index (14.5 The most extreme price increases have been for
diesel fuel (329 increase), copper and steel products (30% increase).
Changes that were also made to the City Center Theatre from a black box theatre to a
proscenium theatre resulting in an $8.5 million cost increase. The upgrade is estimated to
pay for itself due to the high demand for that type of theatre from the identified users.
Escalating costs were originally thought to be covered by private fundraising. To date,
$3 million have been raised and is not sufficient to cover the costs. To be able to approve
the next set of construction contracts, funds must be available. At this time, there is $45
million in cash, which is not enough to award the contracts.
Mayor Brainard asked the CRC to approve the installment purchase plan to cover the gap
from the additional TIF revenue for the costs of the additional items. Three installments
can be issued over a three -year period. The lease payment alternative is structured so that
it can be paid off at any time without payment penalty. Some final installments may not
be necessary `depending on Private fundraising. The CRC has ultimate control in regards
to approval of funds.
The'Mayor reported that the decisions that have led to the need ,for additional funds, have
been those of the executive branch (Mayor and staff), and not those of the CRC.
Only commercial properties pay,into a TIF district ensuring that no residential taxpayers'
dollars are used to fund the project (except for owner occupied houses three stories or
higher). Businesses that benefit from the project pay the taxes to fund the project.
Residential taxes are not increasing due to the approval of an additional $45 million for
the project. Discussion ensued.
Mr. Sharp asked if the financial projects included the Parcel 47 Keystone Construction
area slated for development Jason Semler with Umbaugh Associates, stated that
including the additional commitment (Parcel 47), there would be more than $1`.6 Milli on
in surplus for 10 -15 :years, then decreasing to approximately $1 million in 2020..
Therefore, there is sufficient revenue for the project.
If the CRC does not support the;$45 million lease installment plan, drastic changes have
to be.made to the PAC rendering it no longer able to perform its purpose. Additionally,
the smaller theatre would not be built. This would negatively.affect future operating
costs.
Mayor Brainard and Karl Haas explained how the CRC has ultimate control of the funds
under the loan program. According to Resolution 2008 -1.1, the funding is "designated by
the Commission for participation in the loan program." Each transaction will be
structured as an installment purchase by the CRC from one of its designated lenders.
2
CRC Meeting, October 15, 2008
Each time there is a contract with the CRC as a specified "party," it will be brought
before the Commission for approval. Each loan transaction would first have to be
approved by the CRC. Secondly, a vote would take place deciding whether the
construction contract is eligible for participation in this project. Approval of a contract
by itself would not qualify for participation in the program. The loan program has a $45
million cap. Approving the $45 million allows approval of construction contracts to
happen more quickly and helps tie down escalating construction costs.
Ron Carter summarized the discussion: the features of the project have gone up, the
benefits of the project have gone up, the costs have gone up. The need for an additional
$45 million is a combination of these. Fundraising is slower than expected, but it is still
anticipated to be successful as the building nears completion. The •construction needs to
progress, and the Mayor is asking for the CRC to provide funding to keep it on schedule.
If the private funding is successful, the CRC may not draw down the entire $45 million.
Mr. Haas also stated the program can be stopped at any time by the vote of the
Commission.
Ms. Anker moved to approve Resolution 2008 -11 approving the CRC installment
purchase contracts. by Mr. Hammer and unanimously approved
Mr. Sharp stated he disliked being in the position where; the CRC's choices are
circumscribed Mr. Hammer questioned Mr. Haas if there would be any problems
regarding obtaining the loan due to the current credit market. Mr. Haas stated a
representativefrom Regions Bank was eager to move forward. Mr. Sharp requested that
all members. the CRC receive a breakdown of all proposed costs for the three items
outlined in the term sheet within one week. Mr. Olds stated he would provide the
information and would continue to attempt to meet with Mr Sharp to go over the costs.
He is also available, to meet with Commissioners to review. in detail the draft outline of
costs.
Committee Reports
Mr. Sharp, Plan Review Panel (PLP) Chairman, reported the PRP met on September 18,
2008. The members of the PLP also include Jeff Worrell and Les: Olds. The PLP, Steve
Sturtz and Laurence Armstrong (Pedcor Design Group) reviewed the,design development
plans for Parcel 7C. Parcel 7C is located south of the PAC and contains the small
performance theatre, parking garage, several office buildings and loft condominiums on
the Monon Trail. The committee voted unanimously to recommend to the full
Commission approval of the design concepts as submitted, allowing the architects to
move forward on the project.
Mr. Olds reported that with the approval of the design concept plans, the architects will
be moving forward on completion of construction documents for the garage and theatre
portion of the project. The Energy Center construction is complete and will be followed
up with construction beginning on the McComas Construction building on the southwest
comer of the project.
3
CRC Meeting, October 15, 2008
Mr. Sharp moved to approve Parcel 7C design concepts as being in substantial
compliance with the documents dated 6 -12 -08 as they have been submitted and approved
by the Carmel Redevelopment Commission Plan Review Panel on September 18, 2008.
Seconded by Mr. Worrell and unanimously approved.
Update on Properties
The opening for the Indiana Design Center is on schedule for early spring 2009. No date
has been set by the developer. Construction on First Ave. SW is currently underway.
Mr. Olds reported the north gateway construction will begin soon.: The gateway has been
moved farther north, in response to concerns from area property owners. The arch is now
16 ft. wider with the sidewalks now inside the arches. There will be additional costs but
are anticipated to fall within the approved budget amount.
Ms. Anker questioned a scheduled date for bringing an ARTEC engineer to Carmel to
discuss the design of the theatre. Mr. Olds reported he would prefer to get the CRC's
input before bringing a representative from ARTEC to Carmel to finalize the official
interior layout of the building. Mr. Sharp suggested gathering the interested groups to
provide input, as well while ARTEC is available.
Arts Design District Update
Ms: `Mielke reported the next Gallery Walk is Saturday, November 8 from 5 -10 .p.m.
Mr. Olds reported various merchants in the area have contacted him requesting assistance
pg g their in a radin their exrstin g facades.
Old Busines
Approval of Resolution 2008 -8
Richard Starkey with Barnes &Thornburg was present to give an overview of the process
of establishing the Economic Development Area Plan and confirmatory resolution
confirming the TIF area The .CRC has adopted a declaratory, resolution and has received
approval from City Council and the Carmel Plan Commission, and a Public Hearing was
held at the previous CRC meeting. Approval of Resolution` 2008 -8 is the final stage for
the adoption:
Mr. Hammer questioned the status of the road design. Mr. Pittman reported that he has
met with City Engineer, Mike McBride. Pittman Partners was asked to increase the depth
of surface to L5 inches, put in a turn lane for the school, and extend the curb to the'146`
Street right-of-way.
Ms. Anker moved to approve Resolution 2008 -8 declaring the Legacy Project EDA to be
an.Economic Development Area, approving the Economic Development Plan and
establishing a TIF Allocation Area Seconded by Mr. Worrell and approved 4 -1. Mr.
Sharp did not vote in favor of the motion, as he felt this was an inappropriate use of TIF
funding as well
4
CRC Meeting, October 15, 2008
Mr. Backer stated, in his opinion, this would be a long -term negative impact on the
school system.
Mr. Worrell stated he would be voting for Resolution 2008 -8 as he feels it benefits the
residents in the area since they will be receiving a road that will not be paid for from
taxpayers dollars and will be done in a much timelier manner.
Mr. Carter stated he felt it was important to not leave the school with residents in Legacy
having no way of getting there except on a two -way road. The CRC could have also left
access to Hazel Dell as a two -lane road until development caught up with the area at
which time it would have to be upgraded. Instead, with the approval, the CRC will be
getting the development and infrastructure done ahead of time.
Mr. Hammer stated he felt Pittman Partners does a quality job of development and that he
supports the project. This puts the development ahead of the curve for a side of town that
needs it with the new River Road and the new road connecting River Road to Hazel Dell.
It is also important to keep development moving in these unfortunate economic times.
Approval of Project Agreement between CRC and Keystone Group, LLC
Mr. Carter gave an overview of the steps that have been taken to 'appr'ove a project
agreement between the CRC and Keystone Group, LLC for development of Parcel 47
Project:
Mr. Olds reported the environmental demolition is scheduled fo start that week with the
of asbestos from the inside and outside of the buildin s.
Mr. Hammer remarked on his approval for the interior plaza that will be used as public
space. Mr. Carter also noted this will be Carmel's first LEED. certified building including
a green roof.
Mr. Sharp moved to approve the. Project Agreement between the Carmel Redevelopment
Commission and Keystone Group LLC. Seconded by Mr. Hammer.
Mr. Sharp moved to amend the motion to include "in substantially final form subject to
the conclusion of the exhibits in the final form of the document." Seconded by Ms.
Anker:
The motion was unanimously approved.
Approval Resolution. 2008-10
Mr. Haas explained with the approval of the Project Agreement, the final action needing
to take place is the approval. of Resolution 2008 -10 establishing the TIF and pledge the
TIF to make available for the construction of the garage.
Mr. Hammer moved to un -table Resolution 2008 -10. Seconded by Mr. Worrell and
unanimously approved.
5
CRC Meeting, October 15, 2008
Ms. Anker moved to approve Resolution 2008 -10 Pledging the TIF from the Arts District
Lofts and Shoppes Tax Allocation Area to the payment of Keystone's Economic
Development Revenue Bonds. Seconded by Mr. Hammer and unanimously approved.
Approval of PAC Bid Package #5 and Bid Package #6
Mr. Olds reported the construction manager has given his recommendations on Bid
Packages 5 6 for awarding the contracts. The construction manager recommends
awarding contracts for Bid Package #5 in the total amount of $16,431,240 and for Bid
Package #6 in the amount of $2,400,304. The CRC is asked to award these contracts
subject to available funding. With approval, the contractors will know we are moving
forward and will award the contracts once the funding is in place.
At this time, the CRC has awarded contracts for bricks and mortar in the amount of $70
million based on the bond money and interest on the bond money in place. The CRC
cannot award future contracts unless additional funding is approved: The contacts need
to be awarded even though the payment on the contracts will not occur until late
2009/2010.
Sharp asked if the contracts in bid packages #5 and #6 are all base bid's, or if they
include upgrades or alternates. Mr. Olds stated there are some upgrades in each of the
bids that need approval
from the Commission. Discussion ensued
Tony Eisenhut, construction manager from Sheil Sexton, was present to discuss the,
combined bid packages.
[Mr. Backer leaves at 8:14 p.m.]
Mr. Hammer requested that in the future, that bids are organized identifying when there is
an alternate and when there is an "upgrade" or scope of work change for the benefit of
the Commission. If there are opportunities for value engineering, those should be noted
as well as an opportunity to save money.
Mr. Sharp moved to approve action item #6 (PAC Bid Package 5) and action item #7
(PAC Bid Package 6) in their entirety, subject to the funds becoming available and the
Executive Director and Construction Manager disclosing to us [CRC] details of any
scope of work changes or upgrades. Seconded by Mrs Hammer.
Mr. Sharp moved to amend his motion by being provided with any, scope of work
changes or upgrades and that same being approved by the Commission. Seconded by Mr.
Hammer.
Mr. Hammer' asked Mr. Sharp if would entertain a further amendment that also included
opportunities for value engineering at different levels and see significant savings.
6
CRC Meeting, October 15, 2008
Mr. Haas suggested that Mr. Sharp move for approval of action items 6 7 and the bid
packages subject to the availability of funds and also subject to the CRC being provided
information on upgrades or value engineering with an opportunity to evaluate and
approve any upgrades or recommendations on value engineering.
The motion passed unanimously.
New Business
There is no new business at this time.
Other Business
Mr. Sharp questioned if we are able to find the best deal on this lease, and if it is in the
best interest to bid out the separate pieces of Parcel 7C.
Mr. Olds stated he will take Mr. Sharp's suggestion under advisement, but that the theatre
and the garage must be built together because of the joint footings and close proximity.
There is no way to build one without extreme penalty to the other 100% of a smaller
garage or 70% of a larger garage is owned by the CRC. Discussion ensued
Adjourn
Mr. Sharp moved the meeting be adjourned and seconded by Mr. Worrell. The meeting
was adjourned at 8:43 p.m.
7