04/29/2013
COMMUNITY REDEVELOPMENT AGENCY
AGENDA
Location: Council Chambers - City Hall
Date: 4/29/2013- 1:00 PM
1. Call to Order
2. Approval of Minutes
2.1Approve the minutes of the March 18, 2013 CRA Meeting as submitted in written summation by the City
Clerk.
Attachments
3. Citizens to be Heard re Items Not on the Agenda
4. CRA Items
4.1Approve Rental Assistance Agreement, Promissory Note and Personal Guaranty of Agreement between
the Community Redevelopment Agency (CRA) of the City of Clearwater and Great Circle Studios, LLC.,
a web site development company participating in the City Virtual Incubator Program , concerning the
provision by the CRA of loan-to grant rental assistance in the amount of $20,000, distributable monthly
over a twenty-four month period in equal monthly distributions of $833.33, to facilitate the consolidation
and expansion of operations into the premises known as 600 Cleveland Street , Suite 200, Clearwater,
Florida, and authorize the appropriate officials to execute same.
Attachments
5. Adjourn
Community Redevelopment
Agency Agenda
Council Chambers - City
Hall
Meeting Date:4/29/2013
SUBJECT / RECOMMENDATION:
Approve the minutes of the March 18, 2013 CRA Meeting as submitted in written summation by the City Clerk.
SUMMARY:
Review Approval:
Cover Memo
Item # 1
CRA 2013-03-18 1
COMMUNITY REDEVELOPMENT AGENCY MEETING MINUTES
CITY OF CLEARWATER
March 18, 2013
Present: Chair/Trustee George N. Cretekos, Trustee Paul Gibson, Trustee
Doreen Hock-DiPolito, Trustee Bill Jonson, and Trustee Jay E.
Polglaze.
Also Present: William B. Horne II - City Manager, Jill S. Silverboard - Assistant City
Manager, Rod Irwin – CRA Executive Director/Assistant City Manager,
Pamela K. Akin - City Attorney, Rosemarie Call - City Clerk, and Nicole
Sprague - Official Records and Legislative Services Coordinator.
To provide continuity for research, items are in agenda order although not
necessarily discussed in that order.
Unapproved
1.
Call to Order – Chair George N. Cretekos
The meeting was called to order at 1:11 p.m. at City Hall.
2. Approval of Minutes
2.1
Approve the minutes of the March 5, 2013 CRA Meeting as submitted in written
summation by the City Clerk.
It was suggested that page 3, line 3 of last paragraph, be amended to read
“…maintenance costs for the
event associated with the closure of Ft. Harrison…”
Trustee Bill Jonson moved to approve the minutes of the March 5, 2013 CRA Meeting
as amended. The motion was duly seconded and carried unanimously.
3.
Citizens to be Heard re Items Not on the Agenda – None.
4. CRA Items 4.1 Approve the Amendment to Purchase Contract for the purchase of real property
located at 1021 Park Street, Clearwater, by the Community Redevelopment
Agency of the City of Clearwater (CRA), and authorize the appropriate officials to
execute same.
D raft
Attachment number 1 \nPage 1 of 3
Item # 1
CRA 2013-03-18 2
The CRA entered into a contract for the purchase of the subject property located at
1021 Park Street. The original purchase contract afforded the CRA a right of
inspection for, among other things, environmental investigation for a period ending
on March 31, 2013 (Inspection Period). Staff has made all reasonable and diligent
efforts to comply with the limits of the Inspection Period. However, initial findings are
such that additional investigation is necessary to determine the extent of
environmental concerns. The seller is willing to extend the Inspection Period as
necessary.
The proposed amendment provides for the Inspection Period to be extended
through June 5, 2013, and correspondingly, the time for closing will be extended to
occur on or before July 18, 2013.
The additional $6029.23 of Environmental cost will be paid from the CRA
Professional Services, 09311-530100.
Environmental Manager Ed Chesney said an underground storage tank was removed
from the site in 1994. Recent soil borings came back clean; indicating no direct
exposure type risk associated with redeveloping the site. There are low-level
groundwater impacts on the site, which should not impact future development. CRA
Executive Director Rod Irwin said the extension period is no longer needed, as staff is
comfortable with recent environmental findings.
Staff withdrew Agenda Item 4.1.
4.2
Cleveland Street Electrical Service for Blast Friday Events
CRA Executive Director Rod Irwin reviewed Progress Energy’s quote to increase
electrical service to the outlets located on Cleveland Street, from Osceola Avenue to
Garden Avenue. The total estimated cost is $20,478.
In response to questions, Solid Waste/General Services Assistant Director Rick Carnley
said the electrical upgrade would serve the median area from Garden Avenue to
Osceola Avenue. The upgrade will also assist the Farmers Market and other events
held in the area. These outlets were intended originally for landscaping lighting. Mr.
Irwin said there is sufficient CRA funding for the electrical upgrade.
Trustee Jay Polglaze moved to authorize expenditure for the Cleveland Street electrical
service upgrade. The motion was duly seconded and carried unanimously.
D raft
Attachment number 1 \nPage 2 of 3
Item # 1
CRA 2013-03-18 3
The meeting adjourned at 1:28 p.m.
Chair
City of Clearwater
Attest
City Clerk
D raft
Attachment number 1 \nPage 3 of 3
Item # 1
Community Redevelopment
Agency Agenda
Council Chambers - City
Hall
Meeting Date:4/29/2013
SUBJECT / RECOMMENDATION:
Approve Rental Assistance Agreement, Promissory Note and Personal Guaranty of Agreement between the Community
Redevelopment Agency (CRA) of the City of Clearwater and Great Circle Studios, LLC., a web site development company
participating in the City Virtual Incubator Program , concerning the provision by the CRA of loan-to grant rental assistance in the
amount of $20,000, distributable monthly over a twenty-four month period in equal monthly distributions of $833.33, to facilitate
the consolidation and expansion of operations into the premises known as 600 Cleveland Street , Suite 200, Clearwater, Florida, and
authorize the appropriate officials to execute same.
SUMMARY:
The Economic Development Strategic Plan adopted by the City Council recognizes the potential of establishing and fostering the
existing IT/software presence in the Cleveland Street District as one strategy for increasing the economic base, expanding the base
of above-average employment opportunities, as well as assisting in the redevelopment of the Downtown area.
The initiative involves both recruitment of established firms to the Technology District and, particularly in the case of IT/software
industry clusters, providing an environment for start-up, early stage and accelerator firms to develop and grow through the
collaborative interaction of the industry concentration in the District. Most job growth in the IT/software space comes from the
growth and expansion of these start-up firms, and not from recruitment of established firms. Great Circle Studios is one of the
accelerator firms in the District, poised to expand and grow with the appropriate support and assistance.
The traditional approach to supporting the latter group of start-up, early stage and accelerator firms is through establishment of an
Incubator facility with supportive services and management. The facility and operational costs are usually underwritten by the
governmental sponsor, with industry members assisting with services and counseling. It involves significant contributions of capital
and operating funds and usually needs a ready collection of clients to warrant the investment.
Since the City/CRA are in the early stages of Technology District development, and the numbers of potential Incubator candidates
are limited, pursuit of an Incubator does not appear to be cost effective or feasible. Rather, the City/CRA have chosen to pursue a
Virtual Incubator strategy, with services provided to target firms in commercial office buildings in the CRA area, and services
provided under contract by the Tampa Bay Innovation Center, located at the County STAR Center. It is a more cost effective and
efficient approach for where the Technology District finds itself from an evolutionary standpoint.
However, a current impediment to fostering startups and accelerator firms is the lack of affordable lease space in the Downtown
market. Virtually all available, suitable space is in the B+-A category with per square foot rentals between $15 and $22, far above
the rate affordable for an early stage firm. Comparable firms can find rental space in Tampa for $7-$9 per square foot. Clearwater is
at a distinct disadvantage in this regard, and must offset this impediment to allow the market to flourish. The Technology District
Incentives fund approved by the CRA Board last year is intended to be utilized, in part, to even the playing field in that regard and
fashion assistance initiatives to allow early stage firms to develop and expand in the collaborative Technology District environment
critical to success.
The Great Circle Studios rental assistance agreement falls into this category. The firm has negotiated a favorable lease to move into
1,812 square feet of the Bank of America building, with the landlord providing a built out suite, as well as rent concessions, to
provide a turnkey occupancy and a five-year lease with enough expansion space to accommodate their growth projections. They
have been successfully vetted by the Tampa Bay Innovation Center intake board and have agreed to a service program provided by
the Center going forward.
However, the required monthly rental of $2,337.92 ($15.50 per square foot) is beyond the ability of Great Circles to absorb over the
next 24 months of company expansion and growth. They can only absorb a rental rate of $10+/- per square foot. The CRA rental
Assistance Loan-to Grant is designed to bridge that affordability gap and allow the lease to be underwritten.
The $833.33/month rental assistance, continuing for 2 years of a five-year lease, will be distributed directly to the landlord on
behalf of the tenant, with the loan supported by a Promissory Note and Personal Guaranty executed and enforceable against all of
the principals of Great Circle Studios. The assistance is structured as a loan-to-grant with amortization 20% per year over the term
of the lease. Liability for repayment will be based upon failure to perform under the lease and /or breach of contract terms.
Cover Memo
Item # 2
Staff supports this Agreement for the following reasons:
1) The assistance is 100% funded by CRA TIF revenues, which by design are intended to allow CRA’s the flexibility to address the
particular challenges of redevelopment and growth in CRA areas in a more creative and innovative way than is the case with
general governmental funds. Greater risk and creativity are required and anticipated.
2) This agreement offsets the structural impediment to our Technology District development, namely the unavailability of
reasonable office space for early-stage and accelerator firms. The City/CRA must creatively address this issue in the short term to
achieve the larger goal of economic expansion of IT/software clusters in Downtown.
3) This type initiative is facilitative of the City/CRA virtual incubator strategy, thereby avoiding the possibility of greater long-term
cost and operational impact of a physical incubation facility at this point. Some additional risk is offset by greater cost avoidance.
4) Staff would consider this primarily a one-off solution to a particular set of circumstances and not a precedent for our technology
incentive initiative. The basic approach in the past, and going forward, will continue to be assistance through participation in capital
and TIA, with security for the investment based upon a security agreement with the building ownership. However, the particular
circumstances of this situation, a turnkey occupancy needing no capital improvements and a property under transitional ownership
not desiring to complicate marketability, indicated a different approach required to get the deal completed.
5) The structure of this Agreement is such that the funds are distributed over a twenty-four month period, not at the outset, which
will give the CRA risk exposure control to assess the performance of the lease before all the funds are released.
If approved, staff recommends funding from CRA Project 94872, Technology District Incentives.
Appropration CodeAmountAppropriation Comment
388-94872 $20,000Rental Assistance
Review Approval:1) Office of Management and Budget 2) Legal 3) Clerk 4) Assistant City Manager 5) City Manager 6) Clerk
Cover Memo
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