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HomeMy WebLinkAboutLBRA MINUTES 2015-05-27 (2)MINUTES OF THE NINTH MEETING OF THE CITY OF LIVONIA BROWNFIELD REDEVELOPMENT AUTHORITY The Ninth Meeting of the Brownfield Redevelopment Authority of Livonia was called to order at 5:00 p.m. on Wednesday, May 27, 2015, by Chairman Jack Engebretson. MEMBERS PRESENT MEMBERS ABSENT Jack Engebretson, Chairman Lynda Scheel, Vice Chairman Joe Taylor, Treasurer Ken Harb, Secretary Paul Condon Kathleen E. McIntyre Enrico Soave Bill Fried OTHERS PRESENT: Mark Taormina, Planning & Economic Development Director Michael Slater, Director of Finance Karl Zarbo, Lormax-Stern Margie Watson, Planning Department ROLL WAS CALLED. A quorum was present. Engebretson: As you all know, I think you have a copy of the letter from the Mayor thanking Mr. Cambridge for his service to the LBRA. He is moving on to bigger and better things in his legal practice, and will not be joining us tonight or in the future. So we thank him for his service and the contribution that he made. APPROVAL OF MINUTES On a motion by Scheel, seconded by Condon, and adopted, it was: #01-2015 RESOLVED, that the Minutes of the Eighth Meeting of the City of Livonia Brownfield Redevelopment Authority held November 12, 2014, are hereby approved as submitted. Engebretson: Is there any discussion? Condon: I just want to say how complete those minutes are. I don't know exactly who is doing them, typing them up. Margie? Engebretson: Margie. Condon: Excellent job. They are very, very easy to follow. Thank you. Brownfield Redevelopment Authority May 27, 2015 Page 2 Engebretson: I think I made similar comments to that issue last time. These minutes really are done exceptionally well. So thank you, Margie, for that. Watson: Thank you. A roll call vote on the foregoing resolution resulted in the following: AYES: McIntyre, Scheel, Condon, Taylor, Harb, Engebretson NAYES: None ABSENT: Fried ABSTAIN: Soave Mr. Engebretson, Chairman, declared the motion is carried and the foregoing resolution adopted. REVIEW OF LBRA TAX CAPTURE FOR LIVONIA MARKETPLACE AND CONSIDERATION OF REIMBURSEMENT PAYMENT #2 (W-2014) FOR AUTHORIZED ELIGIBLE EXPENSES. Engebretson: Mr. Zarbo is with us. We're going to turn first to Mr. Taormina and then to Mr. Slater and then to Mr. Zarbo for this comments. Mr. Taormina: Thank you, Mr. Chairman. This reimbursement request covers the Winter 2014 tax collection period and marks payment #2 to the Developer of the Livonia Marketplace, Livonia Phoenix, L.L.C. I will just cover some of the main points very briefly. We look at the total taxable value of all the real and personal property and then make adjustments to determine the incremental value for capture and disbursement. For Winter 2014, the total is $13,425,660. Of that, over two-thirds is accounted for by real property, $10,190,840, and about $3.2 million in personal property. We then make an adjustment for TURBO, which is identified on the spread sheet as the Retained Real Property Value. Then we include the personal property value and subtract the base value, and that gives us the amount that we utilize for figuring out the incremental tax, which ends up being a value of about $2.6 million. Next, the winter tax rate is applied of 16.42 mils, the total tax capture is $43,217.00. Of this, 20 percent or $8,643.58 goes to the LSRRF, which is the Revolving Fund, and the balance, 80 percent or approximately $34,574.00, goes to the Developer. I will note that this is the last tax collection period where TURBO will be factored. When we go back Brownfield Redevelopment Authority May 27, 2015 Page 3 for the Summer 2015 collection, we're going to be looking at some substantially different numbers, higher numbers for disbursement, because it doesn't factor in TURBO. You will recall that for the first year of TURBO, they were exempt 100 percent, and then the ensuing five years there was a 50 percent reduction. With that, I'll answer any questions or if Mike wants to add anything at this point. Engebretson: Are there any questions of Mark, or should we turn to the Finance Director first? Slater: I really don't have much to add. Mark did a great job. I'll be happy to answer any questions. Taormina: One other point. The numbers are different from the summer collection period mostly because of the difference in the applied millage rate. The value is essentially the same, only a slight difference, but the tax rates between summer and winter are substantially different. Engebretson: Thank you, Mark. Karl, would you like to join us at the table here and make any comments you feel are appropriate? Zarbo: Thank you. Karl Zarbo, Director of Operations for Lormax Stern Development Company. We are the owner/manager/operator of the Livonia Marketplace. I'd be happy to answer any questions you may have. Condon: Can you update us like you usually do on what's going on with the property? Zarbo: Let's start with the building that has Petco in it currently. Last week we completed and turned over a 10,000 square foot box to Dollar Tree. They are looking to open on or about July 1. Across the pond, the famous pergola that was built, whose name shall go unmentioned, and the Coney Island building, we have a Hibachi Grill under construction. It's kind of a Japanese buffet restaurant. We've been hit by bankruptcies as I'm sure some of you have seen. We had a Radio Shack that went out with bankruptcy and a Dots that has gone out due to a bankruptcy. So we gained two and lost two. We're sort of treading water. We have just surfaced and it was really last week in Las Vegas, some interest again in that former Baker's Square out parcel. We're getting them as cranked up as we can to figure out what the storm water management component is. That's killed virtually every deal we've had in the last 2.5 years. So Brownfield Redevelopment Authority May 27, 2015 Page 4 we don't know where that will go, but we need somebody that gets excited enough about this site to be willing to absorb those costs or see, if possibly with some changes in Wayne County. I don't know if anybody is going to revisit that. Across the street at Livonia Market 2, again, last week in Las Vegas we surfaced with some interest with two people who would split that building 55,000 and 55,000. It's very preliminary. We have previously had discussions with both of them. We may do one out parcel there also. We have a little bit of the same problem. The issue is the cost of storm water management. The way that building sits, the only place to put a storm water pond really would be at that southwest corner. Condon: By the Art Van parking lot? Zarbo: Yes. Where the trucks used to park. Condon: And thank you very much for that. I appreciate that. Zarbo: It's a battle. I won't say we've won, but we're winning. And that pond is fairly significant because where the pond would go, is not the way the water wants to flow. So there's some significant cost with managing that water. That's kind of where we're at. We've struggled with that site I would tell you honestly probably more than we had thought. We're almost 99 percent leased across our entire portfolio. That's as much vacancy as we experience. We keep picking away at it, but as I've indicated, we've signed two and we've lost two to bankruptcy. And the bankruptcies aren't a reflection on Livonia or the site. I think everybody read about both of them. We're still pretty bullish and keep picking away at it. Engebretson: Thank you for the good job over there, Karl. And regarding the property across Seven Mile Road, those words are very exciting even though the site has many challenges in addition to the storm water management issues. In time that will develop also. I feel very confident in it that with your team involved, we'll see something as exciting on that side of Seven Mile Road as we see on the north side. Zarbo: Yeah, we're bullish and we're not going anywhere. Engebretson: We're glad for that. We're not either, and we're equally bullish. Brownfield Redevelopment Authority May 27, 2015 Page 5 Taylor: I'm sure you know, Karl, that the shopping center across the street is being redone. It looks like they're going to do a nice job on it. That will help that area. Zarbo: We actually took a couple runs at buying that back a few years ago and it just didn't pan out. It would have been a nice acquisition with the former Farmer Jacks but it just didn't happen. Taylor: I'm sorry. You may have mentioned the restaurant but I didn't hear it. Is anything going in where the old pie shop restaurant was located? Zarbo: No. What we mentioned is that we have someone taking a look at it. It's a national. They're excited about the site. They have our whole package. The meetings went very, very well. I don't think they've figured out the storm water management piece. I'm sure when their civil engineers take a look at it and have a conversation with the team here, we'll have to jump start that. Taylor: Thank you. Engebretson: Anything else? If there are no further comments or questions, a motion would be in order. The staff has prepared a recommendation taking care of the obligations that we have under the terms and conditions of this agreement. Kathleen, do you have the prepared resolution? Do you want to offer it? McIntyre: Yes, I would like to offer the resolution if I may. Engebretson: You are recognized for that purpose. On a motion by McIntyre, seconded by Scheel, and unanimously adopted, it was: #02-2015 RESOLVED, that the City of Livonia Brownfield Redevelopment Authority does hereby approve the distribution of Captured Taxes from the Livonia Marketplace Project as follows: 1. Payment #2 (W-2014) to the owner of the Livonia Marketplace, Livonia Phoenix, L.L.C., in the amount of $34,574.34 for the reimbursement of eligible expenses related to the redevelopment of the Former Livonia Mall Site; and Brownfield Redevelopment Authority May 27, 2015 Page 6 2. A deposit of $8,643.58 into the Livonia Brownfield Redevelopment Authority's Local Site Remediation Revolving Fund. Mr. Engebretson, Chairman, declared the motion is carried and the foregoing resolution adopted. The matter will be taken care of just in the nick of time, Karl. I think we had another day or two to go, but this is the way it was planned to be. Zarbo: Thank you very much. ELECTION OF OFFICERS Engebretson: Everybody that is an officer presently is still active. The question is, does anybody want to change? Condon: Are you willing to continue? Which officer doesn't want to continue? Engebretson: Let's do this one at a time. Paul, why don't you get us going? Condon: I would like to offer the name of Jack Engebretson to continue as Chairman if he so desires. On a motion by Condon, seconded by Scheel, and unanimously adopted, it was: #03-2015 RESOLVED, that Jack Engebretson is hereby re -appointed to serve as Chairman of the City of Livonia Brownfield Redevelopment Authority for a one-year period or until a successor is elected. Mr. Engebretson, Chairman, declared the motion is carried and the foregoing resolution adopted. On a motion by McIntyre, seconded by Soave, and unanimously adopted, it was: #04-2015 RESOLVED, that Lynda Scheel is hereby re -appointed to serve as Vice Chair of the City of Livonia Brownfield Redevelopment Authority for a one-year period or until a successor is elected. Mr. Engebretson, Chairman, declared the motion is carried and the foregoing resolution adopted. Brownfield Redevelopment Authority May 27, 2015 Page 7 On a motion by Scheel, seconded by Soave, and unanimously adopted, it was: #05-2015 RESOLVED, that Joe Taylor is hereby re -appointed to serve as Treasurer of the City of Livonia Brownfield Redevelopment Authority for a one-year period or until a successor is elected. Mr. Engebretson, Chairman, declared the motion is carried and the foregoing resolution adopted. On a motion by Taylor, seconded by Condon, and unanimously adopted, it was: #06-2015 RESOLVED, that Kenneth Harb is hereby appointed to serve as Secretary of the City of Livonia Brownfield Redevelopment Authority for a one-year period or until a successor is elected. Mr. Engebretson, Chairman, declared the motion is carried and the foregoing resolution adopted. Engebretson: Is there any other business to come before the Board? McIntyre: Did you say we had a copy of the resignation letter? Engebretson: I don't know if it was distributed or not, but I'll read it to you. This letter was dated January 5, 2015, and is address to Jim Cambridge and signed by the Mayor. It is regarding his resignation from the Livonia Brownfield Redevelopment Authority. "Mr. Cambridge: I have received and do hereby accept your resignation from the Livonia Brownfield Redevelopment Authority effective December 19, 2014, due to your appointment to the Civil Service Commission. Permit me to take this opportunity to express, on behalf of the people of our community, our sincere appreciation for all your efforts and contributions as a member of the Livonia Brownfield Redevelopment Authority. During your six years of service on the Authority, you have been an integral part of the group. I appreciate your conscientious approach to dealing with matters brought before the Authority. 1 look forward to continuing the working relationship with you and the Civil Service Commission." So that's the letter. Is there anything else? Taormina: I would like to let everyone know that when we convene our next meeting, it will also include the first disbursement payment to Livonia Commons. So at upcoming meetings, we will be looking at both projects, Livonia Marketplace and Livonia Brownfield Redevelopment Authority May 27, 2015 Page 8 Commons. Livonia Commons is the old Walmart building on Middlebelt and Schoolcraft which is now Dick's Sporting Goods and Jo -Ann Fabrics. Engebretson: Thank you for that heads up, Mark. On a motion by Scheel, seconded by Taylor, and unanimously adopted, the Ninth Meeting held by the City of Livonia Brownfield Redevelopment Authority on May 27, 2015, was adjourned at 5:20 p.m. Ken Harb, Secretary