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HomeMy WebLinkAboutLBRA MINUTES 2017-11-01 MINUTES OF THE 15th MEETING OF THE CITY OF LIVONIA BROWNFIELD REDEVELOPMENT AUTHORITY The 15th Meeting of the Brownfield Redevelopment Authority of Livonia was called to order at 5:00 p.m. on Wednesday, November 1, 2017, by Chairman Engebretson. MEMBERS PRESENT: Jack Engebretson, Chairman Lynda Scheel, Vice Chairman Ken Harb, Secretary Heather Douglas Andrew Lendrum Kathleen E. McIntyre (5:03) MEMBERS ABSENT: Bill Fried OTHERS PRESENT: Mark Taormina, Planning & Economic Development Director Michael Slater, Director of Finance Barbara Gamber, Economic Development Coordinator Karl Zarbo, Lormax Stern Development Company Margie Watson, Planning Department ROLL WAS CALLED. A quorum was present. APPROVAL OF MINUTES On a motion by Scheel, seconded by Harb, and adopted, it was: #11-2017 RESOLVED, that the Minutes of the 14th Meeting of the City of Livonia Brownfield Redevelopment Authority held September 6, 2017, are hereby approved as submitted. A roll call vote on the foregoing resolution resulted in the following: AYES: Scheel, Harb, Lendrum, McIntyre, Engebretson NAYES: None ABSENT: Fried ABSTAIN: Douglas Mr. Engebretson, Chairman, declared the motion is carried and the foregoing resolution adopted. Brownfield Redevelopment Authority November 1, 2017 Page 2 REVIEW OF LBRA TAX CAPTURE FOR LIVONIA MARKETPLACE AND CONSIDERATION OF TAX INCREMENT FINANCE (TIF) REIMBURSEMENT PAYMENT #7 (S-2017) FOR AUTHORIZED ELIGIBLE EXPENSES. Engebretson: Mark, are you going to introduce this one? Taormina: Yes. This represents payment #7 to the developer of the Livonia Marketplace, and it coincides with the Summer 2017 tax capture. Pursuant to the approved Reimbursement Agreement and Brownfield Redevelopment Plan, the LBRA is obligated to make regular biannual payments following the City's collection of both winter and summer taxes. Final payment occurs upon fulfillment of all outstanding reimbursement requests up to $6.6 million dollars, but in no event later than tax increment revenues collected through the Winter 2025 tax bill, whichever occurs first. The Total Taxable Value of all the real and personal property as of December 31, 2016, for the Livonia Marketplace project totaled $11,227,351. This represents an increase over last year's total of $10,948,820 in an amount equal to $278,531, or roughly 2.5%. The total Taxable Value includes $8,828,551 in real property and $2,398,800 in personal property. Again, we capture both real and personal in the case of Livonia Marketplace. For Summer 2017, the total taxes for capture equals the sum of the real property capture, $113,041.11, plus the personal property capture, $62,572.80, for a total of $175,613.92. Of this, $35,122.78 (20%) will be deposited to the LSRRF to pay for administrative costs, and the balance, $140,491.13 (80%) is eligible to go to the Developer. We note that this does not include the Zoo Authority or the Art Institute. Additionally, unpaid taxes totaling $16,417.96, once collected, will carry over to the Winter 2017 distribution. We have provided a staff recommendation and a prepared resolution, and we also have provided a running total of the disbursements that have gone both to the LSRRF as well to the Developer. Engebretson: Thank you, Mark. Are there any questions or comments? Also, Marge, let the record show that Ms. McIntyre joined us at 5:03. Mr. Slater, do you have any comments to add? Slater: No. Mark has done it perfectly. Engebretson: Everything is in order? Slater: Yes. 4 Brownfield Redevelopment Authority November 1, 2017 Page 3 Engebretson: Karl? Karl Zarbo, Director of Operations, Lormax Stern Development Company, 38500 Woodward Avenue, Suite 200, Bloomfield Hills, Michigan 48304. No. It's gotten fairly routine at this point, and we appreciate all the assistance. Engebretson: Heather, do you have any questions? You've studied all this, right? Douglas: A little bit. It's going to take a little bit. Engebretson: We have a recommendation from the Planning Director to move on this. Scheel: Are you waiting for a motion? Engebretson: Yes. On a motion by Scheel, seconded by McIntyre, and unanimously adopted, it was: #12-2017 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 #7 (S-2017) to the "Owner" of the Livonia Marketplace, Livonia Phoenix, LLC, in the amount of $140,491.13 for the reimbursement of eligible expenses related to the redevelopment of the Former Livonia Mall Site; and 2. A deposit of $35,122.78 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. Brownfield Redevelopment Authority November 1, 2017 Page 4 REVIEW OF LBRA TAX CAPTURE FOR LIVONIA COMMONS AND CONSIDERATION OF REIMBURSEMENT PAYMENT #5 (S-2017) FOR AUTHORIZED ELIGIBLE EXPENSES Engebretson: The representative on this item is unable to be with us tonight, so Mark, we'll start with you. Taormina: This project is pretty much on autopilot as it relates to these biannual tax increment revenue payments. This request is for TIF reimbursement Payment #5 to the developers of the Livonia Commons shopping center, which is the development on Middlebelt Road and 1-96. The project is anchored by Dick's Sporting Goods and JoAnn Fabrics as well as other tenants that we identify in the report. This is Payment #5 which coincides with the 2017 Summer tax collection. The Livonia Commons Brownfield Plan captures only the incremental taxes on the real property. We do not collect personal property for TIF distribution back to the developer. For the 2017 tax year, the taxable value of all the real property at Livonia Commons totaled $3,026,533, representing an increase of 10.48% from the previous year's taxable value of $2,739,280. Subtracting the established base value of $1,740,800 results in a total Incremental Value for Capture of $1,285,733. Applying the tax rate for capture, 28.4471 mils, generates a total capture of $36,575. Of this, $32,718.18 is paid to the Developer, and $3,857.20 (equal to 3 mills of State Education Tax capture) goes to the Michigan Department of Treasury for its revolving fund. That is a statutory requirement. There is a slight adjustment in this disbursement to account for about a $2,000.00 adjustment from December 2016. We inadvertently omitted the Wayne County RESA Enhancement millage from the W-2016 capture. So we are adding that back in. The resolution is for the disbursement of $34,715.14 to the developer and $3,857.20 to the Michigan Department of Treasury. Mike has provided all the details relative to the capture involving this property. Engebretson: Mark, can you comment further on the 3 mills State Education Tax capture? I don't understand exactly what's going on there. Taormina: That is a statutory requirement. The State, like the municipalities, have their own revolving fund that can be used for other brownfield eligible properties. I don't know how they use that fund, but it is something that we are required to pay Brownfield Redevelopment Authority November 1, 2017 Page 5 back to the State as part of our tax capture. Maybe Mike can add to that. Slater: The rules between the time we did Marketplace and the time we did Commons changed at the State level. Whereas we didn't have that requirement for Marketplace when we approved the Brownfield Plan, the State's requirements at that time was 6 mill State Education Tax. We're only eligible to collect 3 mills of that for reimbursement. The other 3 goes back to the State. Engebretson: Thank you. You made that very clear and anticipated my question because it was going back to the other operation and don't remember ever seeing that before. Maybe we've seen it before for this particular site. It just kind of stood out. Maybe it stood out because you highlighted it in the packet here and in your comments. Slater: It's only once a year so you would have seen this only a couple times. Engebretson: Ms. McIntyre, do you have a question? McIntyre: I do have a question - to ask for a memory refresher as to why with Livonia Marketplace we have both real and personal in the agreement, and then with the Commons, we just have real. Slater: That was what was agreed upon when we negotiated the agreement. Frankly, I think we got smarter because the personal property part of this, you get 10-15 businesses and sometimes they pay, sometimes they don't. For a very small amount of money, it complicates the whole process. They have different tax rates. McIntyre: Okay. I was thinking it had just been a difference in what we negotiated. There was no change in the Brownfield statute that doesn't allow personal to be eligible. Slater: No. We could have done it. It's small dollars, and our preference going forward is not to capture the personal. McIntyre: Just take real. Slater: Yes. Brownfield Redevelopment Authority November 1, 2017 Page 6 Taormina: Another factor is a lot of these are exempt under today's taxes. I mean if you look at the . . . McIntyre I was wondering too. Taormina If you look at all the ones that are not included, there's no values included. Those all have a taxable value below $40,000. McIntyre: They don't pay anything. Taormina: That's correct. McIntyre: We knew the answer would be good. Taormina: Both of these projects have been audited by the MEDC. They audited Livonia Marketplace two years ago and they're in the process right now of auditing the Livonia Commons project. Engebretson: Anything else, folks? On a motion by Harb, seconded by McIntyre, and unanimously adopted, it was: #13-2017 RESOLVED, that the City of Livonia Brownfield Redevelopment Authority does hereby approve the distribution of Captured Taxes from the Livonia Commons Project as follows: Payment #5 (S-2017) to the "Owner" of Livonia Commons, TMA-LIVCOM, L.L.C., in the amount of $34,715.14 for the reimbursement of eligible expenses, and $3,857.20 to the Michigan Department of Treasury equal to 3 mills of the State Education Tax capture for payment into the State Brownfield Redevelopment Fund. Mr. Engebretson, Chairman, declared the motion is carried and the foregoing resolution adopted. Engebretson: Is there anything else to come before the Board? I'd like to ask a question. Do we have anybody in the stream to fill any of the vacancies that we have on this Board? Don't we have authorization for nine and we have seven members. Taormina: I don't think there are any pending right now. I know we have a full Board. Originally, did we have nine? Brownfield Redevelopment Authority November 1, 2017 Page 7 Engebretson: Yes. Taormina: Let me go back. I think we changed the bylaws to allow for seven. Now there may be an opportunity to have up to nine and I don't know what the Mayor's intention is. Engrebertson: You may be right, Mark. I went back to some of the original work and it started out as nine. Okay. Any other questions for staff or anybody else? Scheel: Are we supposed to review this new email sheet to make sure it's correct and then let Marge know? Engebretson: I remember yours. It had two "II's" and now it's correct. I don't have my Time Warner address anymore. So that's good. Everybody take note of several new email addresses here. If there is nothing else, then a motion to adjourn would be in order. On a motion by McIntyre, seconded by Scheel, and unanimously adopted, the 15th Meeting held by the City of Livonia Brownfield Redevelopment Authority on November 1, 2017, was adjourned at 5:16 p.m. 44/k7 Ken Harb, Secretary