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05/03/2010COMMUNITY REDEVELOPMENT AGENCY MEETING MINUTES CITY OF CLEARWATER May 3, 2010 Present: Chair/Trustee Frank Hibbard, Trustee George N. Cretekos, Trustee John Doran, Trustee Paul Gibson, and Trustee Bill Jonson. Also William B. Horne II - City Manager, Jill S. Silverboard - Assistant City present: Manager, Rod Irwin - CRA Executive Director/Assistant City Manager, Pamela K. Akin - City Attorney, Cynthia E. Goudeau - City Clerk, and Rosemarie Call - Management Analyst. To provide continuity for research, items are in agenda order although not necessarily discussed in that order. Unapproved 1. Call to Order - Chair/Trustee Frank Hibbard The meeting was called to order at 9:00 a.m. at City Hall. 2. Approval of Minutes 2.1 Approve the minutes of the January 11, 2010 CRA Meeting as submitted in written summation by the City Clerk. Trustee John Doran moved to approve the minutes of the January 11, 2010 CRA Meeting as submitted in written summation by the City Clerk. The motion was duly seconded and carried unanimously. 3. CRA Items 3.1 Provide direction to CRA/Economic Development staff whether to pursue an opportunity to purchase a consolidated parcel comprised of 1351 Cleveland Street, 1356 Park Street, 1359 Cleveland Street, 14 S. Evergreen Street, and 1349 Cleveland Street, for the purpose of Brownfields environmental remediation and subsequent redevelopment as a part of the East Gateway revitalization initiative, to negotiate a Contract for Purchase of Real Property containing provisions specifically protective of City/CRA interests, to acquire 2 independent appraisals of value on the property and to develop any other documents needed to prepare for a real estate closing, to be presented at the earliest practical date to Community Redevelopment Agency 2010-05-03 the CRA Board for consideration. In December 2009, the Economic Development and Housing Department (ED) identified 1359 Cleveland Street (Car Pro) as a candidate for the use of its Brownfields Cleanup Revolving Loan Fund (BCRLF) to remedy outstanding environmental issues, specifically groundwater contamination. ED staff approached the owner of the Car Pro site to determine their interest in selling the property for the specific purpose of using our 2009 American Recovery and Reinvestment Act (ARRA) assessment funds and the BCRLF funds. Both of these funds have strict timelines that must be met: 1) 30% of ARRA (or stimulus) funds must be expended by July 2010 and 2) the BCRLF dollars expire in June 2010 and must be returned to the Environmental Protection Agency (EPA) if not expended. Further examination by the city's environmental consultants indicated that the contamination extended to the adjacent two properties to the west of Car Pro. Staff then met with each affected property owner to request access to their sites in order to conduct the environmental assessment and remediation. It was the city's initial intent to purchase only the CarPro site with access to the two properties to be able to conduct the remediation. However, staff has been unable to acquire access to said adjacent properties for the necessary examination and remediation in an acceptable manner. During the course of these discussions, however, the owner of 1349 Cleveland, Dr. Gilbert Jannelli, indicated a willingness to assemble the entire block (1.35 acres mol) for purchase by the City/CRA. The advantages to the CRA East Gateway effort from such an acquisition would be: 1 - CRA ownership of a one acre, more or less, in the target commercial redevelopment center of the East Gateway, which would ultimately be made available for retail, commercial or mixed-use development consistent with the East Gateway effort; 2 - Facilitate the environmental remediation of the site, which due to cost, would likely be beyond the financial ability of the individual owners; 3 - Allow the city to retain and use of over $556,000 in EPA Brownfields funds already received, and position the City to access additional Brownfields funds for the necessary environmental remediation. Dr. Jannelli's proposal for the CRA purchase of the site is provided. As written, staff has a list of concerns that would require significant negotiation on the conditions and terms as well as major document revisions (although staff proposes a new purchase contract used by the City). The offer is presented "as is" for the purpose of information and direction from the CRA. Staff has asked for an extension of the proposal to June 1, 2010 in order to allow time to conduct due diligence if authorized by the CRA. If the CRA authorizes staff to proceed, two appraisals will need to be ordered immediately. Staff would then commence Community Redevelopment Agency 2010-05-03 2 negotiations on the development of an acceptable contract with key terms and conditions (lease terms for the Idle Spur Bar at 1351 Cleveland, real estate taxes, timeframe for removing personal property at Car Pro, etc.). If an acceptable contract is agreed to by the CRA, staff proposes the funds for the purchase be in the form of a loan to the CRA from the Central Insurance Fund with interest at the cash pool rate. The loan will be repaid from the sale of the property as a part of a redevelopment project and/or CRA funds. For the environmental remediation portion, the costs and duration of the cleanup is presently unknown, however, ED has over $283,000 in assessment funds available and approximately $273,000 available in the BCRLF. Demolition and other closing costs would be borne by the CRA from the Redevelopment Fund. A final decision needs to be made by June 1, 2010 in order for ED staff to meet its federal deadlines with the BCRLF and the ARRA funds. In response to questions, CRA Executive Director Rod Irwin said an individual property owner could not afford the environmental remediation. Consolidating the properties presents a redevelopment opportunity that is consistent with the East Gateway plan. Economic Development and Housing Director Geri Campos Lopez said the $273,000 BCRLF funds must be returned if not spent by June 30, 2010. EPA is willing to extend the deadline if a contract is obtained. The ARRA funds require the city to use $140,000 by July 9, 2010. If the ARRA funds are not used on this project, staff can use the funds to address issues at Brighthouse Field and the Joe DiMaggio Sports Complex. Parks and Recreation Director Kevin Dunbar said coal tar was found during construction of Brighthouse Field and the Joe DiMaggio Sports Complex was a former landfill site. Concerns were expressed regarding the cost to purchase the property and cleanup site. One individual spoke in opposition. In response to a concern, Finance Director Margie Simmons said the Central Insurance Fund accumulates charges from city departments for property insurance and liability claims. Interest earnings have accumulated over time. There is approximately $19 million in undesignated reserves. Staff was directed to provide information on the amount loaned out of the $19 million. Trustee John Doran moved to direct the CRA/Economic Development staff to pursue an opportunity to purchase a consolidated parcel comprised of 1351 Cleveland Street, 1356 Park Street, 1359 Cleveland Street, 14 S. Evergreen Street, and 1349 Cleveland Street, for the purpose of Brownfields environmental remediation and subsequent redevelopment as a part of the East Gateway revitalization initiative, to negotiate a Contract for Purchase of Real Property containing provisions specifically protective of City/CRA Community Redevelopment Agency 2010-05-03 3 interests, to acquire 2 independent appraisals of value on the property and to develop any other documents needed to prepare for a real estate closing, to be presented at the earliest practical date to the CRA Board for consideration. The motion was duly seconded and upon roll call the vote was: "Ayes": Trustee George N. Cretekos, Trustee John Doran, Trustee Paul Gibson, and Trustee Bill Jonson. "Nays": Chair/Trustee Frank Hibbard. Motion carried. 4. Other Business Townhouses on Cleveland Street In response to a question, CRA Executive Director Rod Irwin said the city could authorize murals on the walls of the townhouses but it will require an easement from the condominium association. The townhouses will be addressed in Phase 2 of the Cleveland Street Streetscape. 5. Adjourn The meeting was adjourned at 9:35 a.m. Chair Community Redevelopment Agency Attest Cit Clerk U?pRPORArE =??,•? SEA /F ? O R' 0 P CRA 2010-5-3 4