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05/26/1989 COMMUNITY REDEVELOPMENT AGENCY MEETINGPRIVATE  May 26, 1989 The Community Redevelopment Agency (CRA) of the City of Clearwater met at City Hall, May 26, 1989 at 10:31 A.M., with the following members present: Rita Garvey Chairperson Lee Regulski Member Don Winner Member William Nunamaker Member Richard Fitzgerald Member Tyler Grady Member ex officio Also present were: Ron H. Rabun Executive Director Michael J. Wright Assistant City Manager Leo Schrader Assistant City Attorney Cynthia E. Goudeau Secretary The Chairman of the Community Redevelopment Agency (CRA) called the meeting to order and the following items were discussed. Item #2 Minutes Member Winner moved to approve the minutes of the March 10, 1989 meeting. Motion was duly seconded and carried unanimously. Item #3 Approval of Contract with H & G Structures (Bilgore Property) City Staff has been negotiating with H & G Structures over the past few months for the sale of the tract known as the Bilgore Property. Leo Schrader, Assistant City Attorney, reviewed the proposal stating that it has been set up as an option and provides the developer two (2) years to put the package together. He stated that they will pay $25,000 for the first year option and $25,000 for the second year option. Assignment may be allowed by the CRA. There is also a provision regarding the developer not being liable for increases in impact fees. In response to a question, it was reported that the purchasers have two years to exercise their options and three years to complete the project. Discussion ensued regarding the provisions of the agreement with concerns being expressed regarding the purchaser's ability to assign the agreement to another party, the fact that the City is accepting a $290,000 loss on it's investment, how to assure the City receives it's funds and that the project is completed. Discussion also ensued regarding the provision that the City would deduct any increase in impact fees from the purchase price. Concerns were expressed that this would increase the payback period to the City and that the City could not control other agencies' imposition of impact fees. The purchasers stated they would agree to a time limit or cap regarding the deduction of impact fees. Based on the discussion and concerns expressed, Leo Schrader, Assistant City Attorney, presented the following amendments to the agreement: 1) On page one (1), paragraph B, add "provided, however, the optionee shall have no power to exercise this option until 25 condominium units are pre-sold and 10% of the purchase price of each condominium unit is placed in escrow."; 2) On page one (1), paragraph C, strike "without the prior written consent of the optionor" wherever it appears in the paragraph; 3) On page five (5), paragraph 5 add "and closing shall mean the delivery and transfer of legal title" ; 4) On page six (6), add Sec. 3.05 "The obligation of Seller hereunder to consummate the Closing contemplated hereby is subject to the satisfaction, at the Closing, of each of the following conditions (any of which may be waived in whole or in part in writing by Seller at or prior to the Closing): (a) Presales. Purchaser shall have entered into agreements with consumers for the purchase of a minimum of fifty (50%) percent of the Condominum Units to be constructed on the Property, with each consumer having paid an earnest money deposit, in escrow, of at least ten (10%) percent of the purchase price for the respective unit. (b) Approvals of Governmental Authorities. Purchaser shall have secured the approvals of all federal, state, county and municipal governmental authorities necessary for the development of the Property contemplated hereby. (c) Escrow Agreements. Purchaser shall have entered into such Escrow Agreements as may be required hereby for the escrow of Purchaser's Earnest Money Deposit, Certificate of Deposit or Irrevocable Letter of Credit and the escrow of the Earnest Money Deposits of condominium purchasers; which Escrow Agreements shall be upon terms mutually acceptable to the parties hereto. (d) Compliance by Purchaser. Purchaser shall have performed, observed and complied with all the covenants, agreements and conditions required by this Agreement to be performed, observed and complied with by Purchaser prior to or as of Closing." 5) on page eight (8), paragraph 4.13 insert "one year after the execution of the option" after the words "becoming effective" and add at the end of the paragraph, "providing however the total deduction from the purchase price shall not exceed $20,000"; 6) On page nine (9) paragraph 5.01, Subparagraph 3 add, "and any construction undertaken on said property, shall be covered by a performance bond with a copy thereof to be delivered to the seller; 7) On page ten (10), paragraph 6.01, delete "without the prior written consent of the seller" wherever it appears in the paragraph. Commissioner Regulski moved to approve the option to purchase real estate with H & G Structures as amended. The motion was duly seconded and carried unanimously. Item #4 New Business A. Conceptual discussion regarding sale of Laura/Cleveland Street parking lot to MAS ONE. MAS ONE Limited Partnership is proposing to construct the Clearwater Towers next to the First Florida Bank Building. MAS ONE Limited Partnership has been negotiating to buy a portion of Clearwater's Parking Lot #8 in order to facilitate the development of the Clearwater Tower Project. The current proposal includes the price, to be set at $102,275 which is less than the appraised price of $139,000. They are requesting that the CRA construct a public park on the south half of the parking lot with construction costs estimated at $300,000. Once the park is constructed, MAS ONE will maintain it. They are also requesting additional security at the Garden Avenue parking garage. Michael Wright, Assistant City Manager, provided information that the proposed building is to be completed in 2 years, and will be at least equal in value to the existing First Florida building. The current building is assessed at $9.45 million, which generates almost $90,000 a year in CRA funds and $1,900 a year in general revenue funds. That equates to $450,000 over a 5 year period, making the proposed CRA contribution of $336,000 from the park construction and reduced price, equal to less than a 4 year payback. The new building will require the elimination of 68 public parking spaces that will be off-set by the proposed 374 spaces to be built on site. The Garden Avenue parking garage currently has 104 available spaces. Bill Kravis, the owner of the adjacent parking lot to the east is aware of the City plans, and voiced no objection at a recent meeting. Michael Wright indicated the CRA would need to buy the property from the City, and there would be a loss of $10,000 a year to the parking fund. Concerns were expressed regarding converting a portion of the parking lot to a park costing the City $300,000 for construction. It was indicated that MAS ONE is concerned as this is "their front yard" and they would like some input as to its development. They would like it to remain as a passive park. Concerns were also expressed regarding the CRA providing additional security at the parking garage. The Assistant City Manager indicated they would draw up a contract and would continue to discuss the police protection issue. He stated they would include that the price for development of the park would not exceed $300,000 and that there would be language regarding it being a passive use and a joint venture regarding the design. In response to a question he indicated it was hoped closing could be before the 15th of October, l989. B.Discussion regarding status of Downtown Development Board. In the absence of further action by the City Commission, the Downtown Development Board will cease to exist as of September 30, 1989. If there is a desire to continue the Board's existence and taxing authority, decisions need to be made within the next few weeks regarding an operating millage for the 1989-90 fiscal year. One mill of DDB taxing authority will generate between $135,000 to $145,000 in tax revenue. The CRA will receive about $800,000 of which $460,000 must be spent on fixed cost including debt service. That leaves about $340,000 available for other various projects including land acquisition, advertising, promotion and construction projects. This fund should increase incrementally as new buildings enter the tax rolls, but it will be at least 2 years before the impact of the two proposed projects are realized. In light of the renewed revitalization effort reconsideration of the "sunset" of the Downtown Development Board is needed. Staff is suggesting a partnership between DDB and the CRA whereby the CRA concentrates on matters leading to construction and land acquisition and the DDB concentrate on promotion and public relations. It was stated that the deadline for submission of millage rates to the Property Appraiser is July 19, 1989. Discussion ensued regarding whether or not the DDB should continue in existence and it was suggested that a joint meeting with the Downtown Development Board be established. Further discussion ensued regarding the need for the Downtown Development Board and whether or not the taxing authority was an undue burden on the downtown property owners. It was the consensus of the CRA to set a joint meeting with the Downtown Development Board for 9:30 A.M. on June 13, 1989. In response to a question regarding the status of the Downtown Streetscape Program, it was indicated that the project is slightly behind schedule, however, part of this was due to the Department of Transportation prohibiting closure of lanes earlier than 9:00 A.M. and later than 3:00 P.M. This time frame has been expanded and the work should be going more quickly. Item #5 - Adjournment. The meeting adjourned at 12:41 P.M.