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07/12/1993 COMMUNITY REDEVELOPMENT AGENCY July 12, 1993 The City Commission, meeting as the Community Redevelopment Agency, met in regular session at City Hall, Monday, July 12, 1993 at 2:15 P.M., with the following members present: Rita Garvey Vice-Chairperson Richard Fitzgerald Member Sue Berfield Member Arthur X. Deegan, II Member Fred Thomas Member Phil Henderson Ex-officio Member Absent: Lillian Trickel Ex-officio Member Also Present were: Michael J. Wright Executive Director Milton A. Galbraith, Jr. Attorney Cynthia E. Goudeau Secretary ITEM II. - Minutes: Approval of the minutes of the June 28, 1993, meeting was continued. ITEM III. - Unfinished Business a) Status report re: Executive Director search Member Deegan reported that he and Member Thomas had met for several hours this morning reviewing 62 resumes for Executive Director. All resumes submitted were screened by Mike Laursen, Human Resources Director, to determine whether or not they met the minimum qualifications. The resumes were reviewed and there are 10 candidates on the short list. He reported the resumes came from all over the country with many from Florida. All 62 reviewed seemed to meet the minimum qualification and there were a total of 103 resumes received. He indicated the screening committee is now seeking direction regarding what the next step should be. He stated they are recommending that they talk to the individuals in their locale in order to see projects on which they have worked. He stated based upon these visits, the short list of 10 could be reduced to 3 or 4 to be invited to be interviewed in Clearwater. He stated he and Member Thomas are willing to devote next weekend to travel to the Ft. Lauderdale/Miami area where a number of candidates reside. He stated one is in New Orleans and they would be invited here for interviews. Others are in this area and they would be interviewed during the coming week. Vice-Chairperson Garvey questioned why they would not go to New Orleans and Member Deegan responded they were trying to limit the time as well as they did not believe the projects that had been done in New Orleans were something that they would like to see. Member Thomas stated they would have a staff person from Human Resources or the Clerk's Department with them to record the meeting. Member Deegan indicated it was anticipated they could come back with the short list on August 2nd. Vice-Chairperson Garvey stated there should be an opportunity for other members to sit in on the interviews that are held locally. She emphasized a need to accommodate staff's schedule. Member Fitzgerald indicated he had no problem with the screening committee doing some additional short listing and suggested they interview the candidates individually when they are brought here. b) Incubator Proposal Scott Faris, Executive Director of the Enterprise Corporation of Tampa Bay, has submitted a proposal to do a feasibility study and implement a business incubator for the City of Clearwater. The first phase would be a comprehensive feasibility analysis. The Enterprise Corporation proposes to do this analysis and a preliminary business plan for a cost of $2,500 plus expenses. Should the study find that an incubator is advisable, the proposal would be for the Enterprise Corporation to manage the incubator through a central director with qualified administrative staff on site at the incubator. Mr. Faris also anticipates that the incubator would require 15,000 square feet of space as well as support to new and existing companies in the City of Clearwater. Funding for the center would be through a mixture of public and private funds and in-kind support as well as revenues derived from space rental. Vice-Chairperson Garvey expressed concerns regarding the cost not being known as the incubator will require a director and staff and the facility. The Executive Director indicated the proposed cost for the feasibility analysis is a moderate sum. He stated the significant dollars would be for the 15,000 square feet of office space. Member Deegan suggested there are several types of incubators and the proposal seems to be talking about small manufacturing. He was concerned that he did not see reference to a retail incubator. Vice-Chairperson Garvey also pointed out that in the concept, there is a common administrative center that may not be where the incubator is. The Executive Director stated the incubator can be any or all of the things mentioned. He stated that Mr. Sternstein had advised Mr. Faris that the proposal should include retail. Member Deegan indicated he was looking for more detailed information and at this point, he was not inclined to move forward. He felt it would be appropriate to put it on "the back burner". Member Thomas stated the proposal was not worthy of the $2,500 for the study at this stage. He felt it should be dealt with in the future in more detail. Vice-Chairperson Garvey questioned whether or not the incubator should be limited to the downtown. Member Deegan stated the CRA is limited to the downtown. Member Thomas suggested it could be a joint venture between the CRA and the City but indicated that this question points out that there are many questions not on the table as of yet. Vice-Chairperson Garvey suggested the proposal be given to the new Economic Development Director of Clearwater to work with the CRA Executive Director and have them put together a proposal. The Executive Director pointed out that the CRA's Executive Director would be first hired and would probably be able to address the issue more quickly than the City's Economic Development Director. Member Berfield suggested this be tabled for now and when the Executive Director is hired, that they start looking at it. She stated she was not comfortable with it being limited to the downtown area. Vice-Chairperson Garvey reiterated the consensus which was that this not be taken up at this time and it be left to the new Executive Director for the CRA to come back with a proposal. c) Community Development Corporation (CDC) status report - Verbal Mr. Wright indicated that it is a high priority for the planning staff to assist in getting ready for the first application submittal date in March of 1994. Mr. Sternstein indicated that the State would not give a date certain for applications being accepted but they will give us a date by letter in the future. Vice-Chairperson Garvey suggested it would be best to let the new Executive Director submit the proposal. Member Deegan stated he had asked the City Manager to get a list of specific steps that had to be gone through. The Executive Director indicated that list had not been completed. Member Deegan reiterated the request was for this CDC to be formed during the summer months. This would include an election of a board of directors and that the area would be co-terminus with the already established enterprise zone. He stated the direction was also that the application be prepared. These things are to be done by October 1st. He stated the new Executive Director would be able to "climb on board" with this in progress. He requested the steps to be taken be sent to the CRA members as soon as possible. Member Thomas questioned whether or not staff was going forward to form the CDC. The Executive Director indicated it was. ITEM - Sun Bank Building Krumm and Associates has submitted a proposal that in addition to purchasing the Sun Bank Building from the City, it wishes to purchase the Bilgore site from the CRA for parking, have an option on the remaining two floors of the Sun Bank Building parking garage, currently owned by the CRA and an option on the police department property owned by the City. This proposal was discussed by the CRA at a special meeting on July 8, 1993. At that time, the CRA stated they wished to discuss it further at this meeting. Member Deegan agreed that parking is a problem in the downtown area however, he is opposed to selling the Bilgore property and would prefer to lease it as his hopes are that in the future, to have a mixed use development on that property. This will generate more revenues to the City than a parking lot. He stated he would have wished to have sold the remaining portion of the parking garage. He stated although not owned by the CRA, he takes exception to an option on the police department property. He stated he would contract for a right of first refusal but not for $2.00 a square foot and no 2 year holding of the police department property. Member Berfield stated she agreed regarding the police department property and she did not see how they could be given an option for that property but she did support a right of first refusal. She stated she would prefer to see if they could take the remaining two floors of the parking garage. She requested staff find out if they would be willing to buy the remaining two floors up front. She also requested they be approached to pay all closing costs. It was stated that had been settled and the request for bids indicated that all closing costs would be paid by the purchaser. She stated regarding the Bilgore site, she had no problem with the City retaining it and making it a parking lot. Member Deegan indicated it had not been settled who would actually develop the parking lot. Member Berfield stated if the parking garage were to be sold, it would go back on the tax roll. Member Fitzgerald stated he was opposed to selling the Bilgore property and he did not favor leasing it unless it was advantageous to the City. He was not in favor of addressing the police department property and binding a future Commission. He is in favor of the purchasers of the building buying the remainder of the parking garage and allowing them to resolve their parking problem that way. He stated he would be willing to entertain other proposals that they may bring forward. He reiterated the closing costs were clearly indicated to be part of the purchase that they pay. Member Thomas agreed it was not right to do anything regarding the police department property as it is city owned, must have an appraisal and the Commission would not be able to give an option. He stated however that a right of first refusal would fit in. He stated in the proposal, they would purchase the garage for $700,000 however they wanted to delay that purchase due to cash flow. He stated he would not oppose some level of financing that would allow them to purchase the garage building now. He stated in the proposal, a survey of the garage building includes the land surrounding it that the police department is currently using for parking. He stated there would be 38 spaces. He reiterated he favored some form of financing on the parking garage, leasing spaces on the Bilgore site and to trade off spaces on the Bilgore site for those that would be lost by the police department. Member Thomas further stated that if the police department property should be put up for sale, the purchasers of the Sun Bank Building could have the right of first refusal but in that agreement, if they do not buy the police department land for the appraised value at that time, they loose spaces on the Bilgore site. Vice-Chairperson Garvey indicated she agreed it was inappropriate to sell the Bilgore site because of the potential for future development. She indicated she was not opposed to leasing it for a limited number of years. She agreed it was inappropriate to tie the police department land as part of this deal but had no problem with the right of first refusal. She was opposed to the price and the timeframe as proposed. Member Berfield pointed out the CRA could not approve anything regarding the police department land as it is owned by the City. The Executive Director asked that they consider not selling anymore than the footprint of the garage as the lack of parking for the police department would limit future expansion of that building. He also indicated Pinellas Trail will cause some problems with when and how prisoners are transported. He indicated the property between the garage and the police department is critical. Member Deegan supported Member Thomas' suggestion that the police department continue to use the L-shaped property around the parking garage and allow the Sun Bank Building purchasers to use a number of spaces on the Bilgore site. The Executive Director indicated that during the discussions they had never talked of more than the parking garage and did not realize that any land came with it. Member Deegan questioned what Member Thomas had in mind regarding financing on the garage. Member Thomas indicated that during the special meeting on the 8th, the purchasers had stated that if the CRA would finance, they would buy the garage. He stated this would help them with their cash flow but they would buy the garage on the front side. The Executive Director reported he had been informed that a subsequent deed from the CRA to the City granted the surface parking around the parking garage to the General Fund. Member Thomas questioned whether or not we were absolutely sure whether or not this was absolutely certain. Staff is to investigate further. Again, Member Deegan questioned the terms for financing indicating the CRA would have to defease the bonds if the parking garage were sold. The Executive Director indicated this would have to be reviewed. Vice-Chairperson Garvey suggested the Executive Director be directed to recommend to the City Commission that the police department land is not for sale but a right of first refusal would be acceptable but not at the price or time constraints in the proposal. The Attorney indicated the right of first refusal would then to be built into the bidding process at some point. The Vice-Chairperson asked what direction was to be given regarding the Bilgore site. The Executive Director questioned whether or not the CRA would want to lease the space for $26.75 per month which is the current rate being charged for other surface parking. It was questioned whether or not the City would build the parking lot or the purchasers. Member Deegan pointed out that if the purchasers were to build the lot, the CRA could not charge the monthly rate. The Executive Director indicated it would cost between $1,200 and $1,500 per space for surface parking. The Vice-Chairperson pointed out that the purchasers are looking for free parking and she suggested they be allowed to use the parking on the Bilgore site for five years to allow them to look for other parking opportunities. Member Deegan again pointed out that the CRA would have to develop the parking lot in order to lease it to the market rate. The Vice-Chairperson indicated she was not necessarily advocating market rate. Vice-Chairperson Garvey suggested two options be given to the purchasers, them paving and having control or the CRA paving, having control and charging the same rate as in other parts of the City. Member Thomas stated that at $26.75 per month, each space would cost approximately $475 a year or $70,000 a year for the entire 150 spaces on the Bilgore site. The Executive Director stated he had calculated $360 per year with the result in annual revenue of $48,750. Member Thomas indicated the purchasers had said it would cost $280,000 for the parking lot. Member Thomas expressed concerns regarding tieing up the property for five to ten years. The Vice-Chairperson stated that leasing was being discussed and the question was whether they pave the lot or the CRA paves the lot. Member Thomas stated he wanted to put on the table that if they buy the garage, that the CRA would finance the purchase. Member Deegan stated they would not be satisfied with just the garage. The Executive Director indicated there was 72,000 square feet of property on the Bilgore site and would possibly hold 200 spaces with drainage. At a cost of $1,200 per space, it would cost a quarter of a million dollars to construct the parking lot. Member Thomas stated if the purchasers were willing to pay $180,000 for the Bilgore site, that should be the down payment for the garage with a five year balloon for the remainder. He indicated the $180,000 could be used to put parking on the Bilgore site. The Executive Director questioned the maximum length of term for financing the garage. Member Thomas indicated he was contemplating a five year timeframe at an interest rate of what we are being paid. The Executive Director asked what was the consensus for a financing term on the garage. The general consensus was a maximum of five years. The Director asked for direction regarding leasing the Bilgore site. Member Thomas stated we would not be leasing the property but rather the individual spaces and that could add parking to the downtown area. Vice-Chairperson Garvey expressed concerns regarding having that property paved for 20 years. The Executive Director indicated that once the lot had been put in place, it would be there for awhile. He indicated the purchasers concern is permanent parking for the building. Member Deegan stated that talking about both the garage and Bilgore site would solve the immediate problem and to put a short term on the Bilgore site, encouraging the purchasers to find an alternative location. He stated there would be an annual renewal to the spaces, not the land. Member Berfield questioned whether or not Member Deegan was suggesting that the CRA pave the lot and lease. Member Deegan indicated this was his proposal. In response to a question, he indicated he was talking of a maximum of five years. He indicated the contract to lease should be until the CRA gets a pay back on the cost of the parking lot. Vice-Chairperson Garvey questioned what would be the ramifications if other parking opportunities were to come up. Member Deegan restated his proposal saying that the minimum length of time would be the pay back period with a maximum of five years. Member Thomas indicated he still wanted a provision that for the right of first refusal on the police department land, that if the purchasers have the opportunity to buy that land, whether they do or not, they are off of the Bilgore property. Member Fitzgerald expressed reluctance to enter into a long term agreement for the Bilgore property. He stated the minimum period should be as short as possible and he understood the pay back period but felt it should be limited to a maximum of five years. He stated they need to understand all the ramifications regarding the right of first refusal. The Executive Director asked for direction regarding the area they are asking for green space. Member Deegan stated if they were talking the small strip of five spaces, he had no problem with that but he did not want parking to the east impacted. Member Thomas stated the CRA will have to address, through a main street program, redevelopment on both sides of Cleveland Street. Member Deegan indicated the purchasers are interested in improving the appearance of the downtown area. The Executive Director summarized the points stating we will request they purchase the parking garage for $700,000 with a maximum term of five years with a downpayment of $180,000. A question was raised regarding whether this was just the footprint of the building and the Director requested that this remain open and he would deal with that question. Member Thomas expressed concerns that if the legal description includes the land, it would be bad faith to exclude it from the purchase. The Vice-Chairperson indicated she would be in favor of just selling the footprint of the building. The Director reviewed the direction thus far: Sale of the parking garage with $180,000 down; the full purchase price of $700,000 with a five year maximum term; (He questioned whether or not they wanted the payments on installment or a balloon payment. It was indicated this was a point to be negotiated) the hard costs for development of the Bilgore site as a parking lot will be developed exclusive of land and site work and that this would be leased to the purchasers at a term that will ensure pay back of the cost; the parking lot behind the building would not be available for purchase but the CRA and Commission would be flexible regarding landscaping on the right-of-way and further that the CRA recommends to the Commission that they allow a right of first refusal to the purchasers regarding obtaining the police department property. Member Berfield moved that a counter offer be made to the purchasers for them to purchase the remaining two floors of the Sun Bank Building garage for $700,000 with $180,000 down, with a maximum term of five years with the terms of repayment to be negotiated, that the CRA would develop the Bilgore site as a parking lot and lease it to the purchasers for a minimum time of pay back of costs for the parking lot exclusive of the land and the site work, that the CRA/Commission was not amenable to selling the small parking lot between the Sun Bank Building but would be flexible regarding landscaping on the right-of-way and to recommend to the Commission that they negotiate a right of first refusal on the police department property with the purchasers. The motion was duly seconded and carried unanimously. ITEM IV. - New Business a) Elect Chairperson Member Thomas nominated Member Deegan to be Chairperson of the CRA. The motion was duly seconded. Member Deegan accepted. Upon the vote being taken, the motion carried unanimously. ITEM V. - Adjournment: The meeting adjourned at 3:45 P.M.