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HomeMy WebLinkAboutMinutes 2004DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE 51EETING MINUTES WEDNESDAY JA.NUARY 28, 2004 ROOM 2403-8:00 P.M. CIVIC CENTER MEMBERS PRESENT: Aid. Feldman, Aid. Wynne, Aid. Rainey, Marvin Juliar, Barbara Puta, Alice Rebechini MEMBERS ABSENT: Aid. Moran, Aid. Newman, Martin Norkett PRESIDING OFFICIAL: Aid. Feldman, Chair OTHER COUNCIL MEMBERS PRESENT: STAFF PRESENT: OTHERS PRESENT: Summary of Actions: None Judith Aiello, Dennis Marino, Moms Robinson Dianne Williams -Executive Director. Evmark I. Aid. Feldman called the meeting to order at 8:02 P.M. If. While the previous minutes of November 19, 2003 were under consideration for approval, Alice Rebechini advised stall' that a minor name correction on page four was in order. The required name correction was duly noted and the amended minutes were then unanimously approved. III. Dennis Marino provided EDC with a brief summary of the annual Meetings of the Joint Review Boards which occurred on December 11, 2003, as well as comments on the status of the City's four TIF Districts. Copies of the JRB minutes were enclosed in the EDC member packets. Dennis Marino stated that the tenor of the meetings was positive and the various taxing districts were pleased with the success of the development projects within the districts. IV. At the conclusion of Dennis Marino's remarks, Aid. Feldman introduced Ms. Dianne Williams, Executive Director, Evmark. Ms. Williams was appearing before the EDC to present the Annual Report on Evmark Activities. Included in the EDC member packets were copies of the minutes from Evmark's board meetings for calendar year 2003. The hard copy of the minutes . provided the EDC with documented summaries of Evmark's past year actions. Summarizing the activities for the year, Ms. Williams informed the EDC of the successful holiday shopping season experienced by the downtown merchants. Several articles have been written in the local newspapers about the better than anticipated season. DRAFT -NO r-APPROVED ECONOMIC DEVELOPMENT COXIINUTTEE MINUTES-JANUARY 28, 200d PAGE 2 Ms. Williams advised the EDC that approximately 130 retailers were polled and they actually spoke with about 50, which she believed was a substantial representative sample. Eighty-two percent of the retailers surveyed have reported that sales were equal to or better than their benchmark high year of 1999. Some retailers reported having gro%vth in sales in excess of thirty percent. Of particular note is the increase in the number of Evanston residents who shopped in the downtown. Additionally the big product movers were in the low price or high end product lines. The last two weeks of the sales season were exceptionally good and the trend extended into January 2004. Ms. Williams stated that she would be pleased to answer any questions with regard to the annual report. Downtown marketing efforts are ongoing as well as downtown maintenance activities and Rotary banner installations. At this point, Ms. Williams distributed the new "Downtown Evanston Brochures" and Parking guides which are updated every six months. Alice Rebechini asked Ms. Williams to providesome specific information on Evmark's continuous efforts for downtown tenant recruitment. Ms. Williams stated that much of the effort is actually market driven demand and responding to numerous inquiries. The major issue now is the lack of available suitable retail space. Barbara Puta asked if the number of Type 2 restaurants opening in what was formerly other types of retail in certain parts of the downtown area having a negative impact. Ms. Williams responded that she believes so to a certain degree but the question and other issues will probably be better answered from the recently initiated "Downtown Visioning" process. However, the polling survey results indicate that all parts of the downtown area are performing about the same. Aid. Rainey asked what the typical retail space requirement is when Evmark fields inquiries from potential merchants. Ms. Williams said the typical request is for 1,500 square feet. A brief, general discussion ensued regarding marketing to attract specific demographic consumer markets such as. high spending teens and strategies going forward for marketing available, niche office space. Aid Feldman then thanked Ms. Williams for the presentation. Aid. Rainey advised the EDC and staff that she had received complaints from representatives of CVS Pharmacy regarding the length of time required to receive permits and approvals from the city for the completion of their downtown store project. Although some of the delays were caused by CVS, Judith Aiello mentioned that she had spoken with James Wolinski concerning the CVS issues and stated that she would follow-up with the appropriate staff. V. Aid. Feldman next asked Dennis Marino to provide an update on the proposed Howard Street T1F District and the proposed residential development project. Dennis Marino advised the EDC that the City Council approved the new TIF district at the January 26, 2004 Council Meeting. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES-JAtiUARY 28. 2004 PAGE 3 Bristol Chicago Development, L.L.C. has expressed interest in two sites for residential development projects. One site is in the new T1F District on Howard Street. The site is the old surface parking lot that was used several years ago by the Beneficial Trust Insurance Company. Bristol is proposing the construction of a 220 unit rental (convertible to condominiums) building. Bristol is proceeding through the approval process and has been before the Plan Commission. They are scheduled for a return hearing before the Plan Commission next month. Aid. Feldman expressed his view as to how vital the new TIF district and the development project is to the City. Alice Rebechini stated that it is important to have a large, positive turnout for the next hearing at which time Aid. Rainey assured the EDC that there would be. V1. Aid. Feldman asked Judith Aiello to pro%ide an update on the Visioning initiative. Ms. Aiello distributed a four page draft copy of the Downtown Visioning Process Professional Services Agreement between The Lakota Group and City Of Evanston and Evmark. Ms. Aiello briefly explained how the visioning initiative, (first discussed at length at the last EDC meeting of November 19, 2003) was conceived. Copies of the previous minutes are available in the Planning Division. A consensus was reached by a core group of elected officials, City staff, EDC members, Evmark, Plan Commission members, members of the business community and others, to develop a comprehensive process to identify all downtown constituencies, to maintain the downtown success and to better manage future development and commercial opportunities. The proposed visioning initiative as conceived will be a three part process. The first part is to employ a planning consultant to conduct the visioning planning sessions and the Lakota Group is recommended to fulfill that piece at a cost of approximately 514,000. The second component concerns identifying and resolving potential future traffic issues and how best to provide assurance for continued smooth traffic flow, as new projects are introduced. KLOA, a firm the City has used for independent traffic studies on previous occasions will be recommended to provide the traffic study for this piece. It will be recommended that Mid America Real Estate firm be contracted to address the third component of the process. This firm has completed a large portion of the leasing for some of the major development projects, Church Street Plaza in particular. The firm is one of the leaders in the suburban market place and one of their divisions specializes in retail market analyses. The intent will be for them to come to the City, statistically analyze the existing retail mix and then assist in determining what type of retail is needed and realistic so that marketing can be more precisely targeted. A general discussion ensued conceming the proposed process, strategic planning, hypothetical situations, suppositions and opinions based on experiences with the downtown merchants, property owners and past studies, concluding with Alice Rebechini making a motion to recommend approval for the Professional Services Agreement with The Lakota Group. Aid. Wynne provided a second for the motion and the measure passed with a unanimous vote. DRAFT -NOT -APPROVED ECONOMIC DEVELOPIIENT CO,II.NI=EE MINUTES-JANUARY 28. 2004 PAGE 4 VII. Dennis Ifarino informed the EDC of the progress of the IMain Street Commons Shopping center redevelopment project. Much of the building fagade has been demolished and the resurfacing of the parking lot is well under way. The anchor grocery store is targeted for a mid summer opening. Aid. Feldman asked Dennis Marino to determine if the developer intends to permanently continue leasing space for towed vehicles and report back to the EDC. Aid. Rainey commented on the need for and the prompt installation of lights in the parking lot. VIII. Dennis Marino provided a brief update on the residential development project proposed by Tom Roszak/ADC. The proposed project consists of four eight story condominium residential buildings, which will be constructed on the current parking lot at 1100 Clark Street. There will be a total of 222 units with a developer sponsored "S% of units" designated as affordable and set aside for moderate income buyers. Aid. Wynne advised the EDC that the old bank building at Main and Chicago was being demolished. IX. Aid. Feldman acknowledged the revised Economic Development Committee Meeting dates for 2004. X. The communication items which were included in the EDC packets were acknowledged by Aid. Feldman. Barbara Puta asked for an update on the Sherman Plaza Development Project. Judith Aiello stated that the planned health club scheduled for a significant presence in the project had bowed out of the project, but now another health club maybe poised to participate. It is anticipated that the Klutznick development team will appear at the February 18, 2004 EDC Meeting to explain all and will provide a financial and construction update. XI. There being no further business, the meeting was adjourned at approximately 9:30 P.M. The next EDC meeting is scheduled for Wednesday. February 18. 2004 at 8:00 P.M. in room 2404. Civic Center. Economic Development Planner JOINT ECONOAHC DEVELOPMENT COMMITTEE AND PARKING COMMITTEE MEETING MINUTES OF WEDNESDAY MARCH 31, 2004 ROOM 2200-6:00 P.M. CIVIC CENTER MEMBERS PRESENT: EDC: Aid. Feldman, Ald. Moran, Aid. Newman Aid. Wynne, Ald. Rainey, Marvin Juliar, Barbara Puta, Alice Rebechini MEMBERS ABSENT: PRESIDING OFFICIALS: OTHER COUNCIL MEMBERS PRESENT: PC: Ald. Newman, Ald. Bernstein, Aid. Wynne, Paul Giddings, Michael Ginter, Jonathan Perman, David Reynolds,George Woolridge Marvin Juliar-EDC, Larry Rafel-PC Aid. Feldman, Chair-EDC, Aid. Newman, Chair -PC None I STAFF PRESENT: Roger Crum, Judith Aiello, Jean Baucom, Patrick Casey, Keith Fujahara, David Jennings, Dennis Marino, Morris Robinson, Max Rubin, Lloyd Shepard, William Stafford, James Woiinski OTHERS PRESENT: James Klutznick, Maury Fisher, Martin Stern William Walsh and Associate, Diane Williams, Ann Dienner, Richard Peach Snmmary of Acdons• I. Aid. Newman called the Parking Committee to order at 6:15 P.M. and the members of both Committees introduced themselves. Judith Aiello began with a brief review on the status of the old Sherman Avenue municipal parking garage. David Jennings, the Public Works Director, has engaged the services of a structural engineer to provide monthly safety check-ups related to the soundness of the garage. During the past month, additional support shoring has been affixed and the loose lighting fixture on the roof has berg removed. The roof now has been closed to parking to eliminate potentially dangerous situations. Ms. Aiello stated that for various reasons, the original thinking on the part of the Parking Committee was that it would be beneficial to close the entire garage at this time. However, after discussing the possibility with the PC Chair, the Chamber of Commerce Executive Director and the Evrnwk director, a consensus was reached that it would be best to keep the functional parking garage as is far the time being. It is anticipated that the garage will be demolished in three or four months. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT CO'*i�IITTEE MINUTES -MARCH 31, 2004 PAGE 2 Staff has been meeting with an Optima Development principal and determined that there maybe as many as 345 parking spaces which may be made available to the public in the new garage for Optima's new residential development on Sherman Avenue. These spaces could be available for the period of time that it takes to complete the condominiums in the development project. Additional discussions are planned for the near future and it is hoped that a proposed parking agreement will be ready for presentation at the next meeting. There were no questions concerning the presentation and Aid. Newman announced that the PC portion of the joint meeting was over. Ald. Newman stated that a significant discussion on these parking issues, particularly the possibility of closing and demolishing of the old garage, had been anticipated and that was the reason for the joint meeting. But as presented, late breaking circumstances precluded the need to do so at this time. At this point Aid. Newman concluded the PC portion of the joint meeting and presented Aid. Feldman to begin the EDC portion. L Aid. Feldman convened the EDC Meeting at approximately 6:30 P.M. and the EDC Meeting minutes of January 28, 2004 were unanimously approved by the members. U. Although the next item on the EDC agenda was for an update on the "Downtown Visioning Process", Judith Aiello stated that the Sherman Plaza development project would actually be discussed next. Initially the presentation %ill be in open session and then move into closed session. Ms. Aiello introduced the Sherman Plaza development project principals, Mr. James Klutznick and Mr. Maury Fisher. Mr. Klutznick began the update. At the outset, Mr. Klutznick stated that the required financing for a revised version of the project is eminent and should be completed by the end of April. The original version had provisions for a considerably larger health club component and fewer condo units. However, now that a smaller health club has been incorporated in the project, and more condo units are added, serious financing negotiations have been allowed to proceed. Also, proceeding without a health club component is an option. The negotiations are significant enough to the point that concluding the loan acquisition process could occur perhaps as soon as the end of the week. The developer anticipates starting the project sometime during the summer. Ms. Aiello stated that if the developer is able to provide their letter of financing commitment, staff maybe able to present the proposed summary of changes to the development agreement documents for EDC consideration at the April 28, 2004 EDC Meeting. Aid. Newman stressed the urgency as well as the need to proceed with this development project. UL By voice vote, the Economic Development Committee members voted unanimousiv to enter Into Executive Session at 6:30 P.M. for the+purpose of discussing nronrietery land acgaiSMOn issues related to the Sherman Plaza Redevelopment Project. DRAFT-NOT-APPROIED ECONOMIC DEVELOPMENT COMMITTEE MINUTES -MARCH 31. 2004 PAGE 5 The oven session of the EDC Meeting resumed at 6:46 P.M. The waiting audience was allowed to renter the meeting room. IV. Judith Aiello provided the EDC with a brief update on the ongoing downtown visioning process. Ms. Aiello said that she, together with Dennis Marino and Diane Williams have been meeting with the consultant since the City Council approved the consultancy contract. Necessary planning sessions have been scheduled and a date for the concluding joint group presentation, consisting of the various group stake -holders, is currently being considered. V. The next agenda item was the Howard Street TIF District and Proposed Bristol Redevelopment Project. Ms. Aiello reminded the EDC that the City Council approved the planned development project, proposed by Bristol, slated for the long vacant parcel at 413 Howard Street, within the newly created Howard Street TIF District #5. When Ms. Aiello concluded her opening statement, Aid. Newman asked to be recognized. Aid. Newman stated that when the EDC voted to recommend approval for the planned development project, the EDC h ad n o t dea t hat t here w ould b e a request from t he d eveloper, for f inancial assistance from the City. Ald. Newman said that the amount of real estate tax revenue the project would generate was one of the appealing aspects of the proposal. It appears to Aid. Newman that at the time of the EDC vote there were some who knew of a substantial financial request but it was not obvious to him and several other members of the EDC. As such, Aid. Newman would have had a much different outlook on the zoning portion of the project, interjecting that not having complete information is a monumental issue with him. Judith Aiello stated that that staff has not withheld information from the EDC, adding that the issue is that the planned development stood on its own at which time Aid. Newman objected saying that it doesn't stand on its own when the project generates tax revenues which is considered a benefit. Ms. Aiello stated that when the project was first discussed there was no indication that there would be a need for assistance from the City except for required water main pressure improvements to adequately meet the needs of the planned development. After the first of the year, when staff could begin to review the TIF and the plan in its entirety, and the developer could better share their financials, it was then determined that as a rental project, it would prove to have a very thin profit margin. It was then that the developer approached the City with the request for assistance and preliminary discussions of the developer's financial needs began. The preliminary numbers are in no way final because staff has been trying different ways to package a proposal for a presentation to the EDC. What is being presented tonight is a tentative plan for issuing debt and providing payment upfront in a manner unlike any that the City has done in TIF districts before. This proposed, preliminary pay as you go plan would be similar to a sales tax revenue sharing plan except the source of the revenue would be generated from property taxes rather than sales taxes. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES -MARCH 31, 2004 PAGE 6 At this point Ms. Aiello suggested that the EDC enter into executive session to discuss the details. Aid. Rainey asked to be recognized prior to entering into executive session. Aid. Rainey stated that she would like to address Ald. Newman's comments because it appeared to her to imply some people were privy to information while others weren't. Aid. Rainey said the first time financial projections were brought to her attention was only a few days ago but from the beginning the EDC was informed that a proposed redevelopment agreement was in the process of being drafted. This assertion was made numerous times in public meetings. Aid. Rainey further stated that she could not recall a single time that a TIF district development project when there wasn't some kind of developer project assistance provided from the City. Aid. Rainey advised the EDC that it is important to know that the most real estate taxes generated from the four lots designated for the proposed residential project was S 16, 044 and that amount is for the current year. The proposed development project is estimated to generate $700,000. It is a historical fact that only one building permit was ever issued for the four lots. Aerial photographs from the 1890's reveal that the lots look the same then as they do now. The impact the proposed project has had in the new TIF district is evidenced by recent real estate sales which have occurred within the new TIF boundaries. Aid. Rainey announced that the property at 807 Howard Street recently sold for S750,000. Next door to that sold building, 741 Howard Street, a problematic building which has cost the City thousands of dollars was sold two days ago for the sum of S 1.3 million. Immediately to the east of that property, there is a contract for the purchase of 339 Howard Street for the sum S 1.6. Millions of dollars of real estate sales have taken place within the new TIF district, all within the past 30 days. The proposed development project and the publicity it has g enerated i s t he i mpetus f or t his never before seen activity. Aid. Rainey concluded her comments by urging the EDC to review this proposed project in an open and favorable way. Aid. Newman made the statement that when it is asserted that "we all knew a redevelopment agreement was being drafted", that speaking only for himself, he never heard the words redevelopment agreement associated with the proposed project. The effort to establish the TIF district was occurring before the proposed development was introduced and typically, the City has not provided assistance for residential projects. The circumstances concerning this proposed project is very different from the Klutznick project and whereas Mr. Stern was contracted to work on the Klutznick project and to keep the City Council apprised of issues, Aid. Newman only recently learned of Mr. Stem's involvement with the Howard Street project. Aid. Newman stressed the point that he had no idea that an agreement was in the process and that his enthusiasm for the project was based on the belief that the City would receive all of the real estate tax increments and that the proceeds would be used to acquire other properties in the new TIF district. Aid. Newman said that three other members of the City Council stated that they were also not aware of these circumstances. Aid Newman pursued the point that had he known that a request for assistance and that a development agreement was in progress, consideration of these issues would have had an effect on his vote. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES -MARCH 31, 2004 PAGE 7 Aid. Rainey reiterated the value of the project, stating that aside from the recent real estate sales, when this proposed 544.5 million project in one of the most problematical areas of the City is compared to the 590 million Hill project in the very desirable downtown, the City will be getting an excellent deal. The City will not have provided for tenant displacement and relocation costs, demolition cost, and parking requirements. There are no condemnation issues and building height restrictions. It will be a simple, neat and clean project. Aid. Newman asked Dennis Marino if he were working on a redevelopment agreement. Mr. Marino's response was no. Ms. Aiello stated that staff was not at the stage for a redevelopment agreement. Stairs position is that there is a development deal waiting, worthy of pursuing and to present the a preliminary idea to the EDC for consideration, and that is the point for the informational update tonight. Ms. Aiello stated that there is always a redevelopment agreement associated with a TIF project so that whatever public improvements are required, there is an understanding that they will be completed as part of the project. Ms. Aiello apologized for any lack of earlier communication. Often times, issues are discussed with the alderman of the ward before the rest of the City Council knows of the plan, and it places staff and all involved in an awkward position. Perhaps the answer lies in the adoption of a policy from the City Council as to when to communicate to the full body. Aid. Newman interjected that the time to communicate is before the measure is voted on. Ms. Aiello concurred. To be clear, Aid. Newman stated he didn't want to know anything before the other aldermen. Aid. Feldman concluded the discussion by stating his displeasure with the idea that negotiations have been proceeding with the developer since December without the City Council being informed or at least the EDC. Having said that, Aid. Feldman stressed the point of other important issues regarding the proposed project as well as its excellent merits and therefore it should be separated from the debate as to whether the process has proceeded correctly or not. To settle the issue of when the City Council should be informed must be settled in another venue. V 1. By wav of voice vote. the Economic Development Committee members again voted anselmously t o e nter i ato E xecutive S ession a t 7 :15 P.M. f or the aurnose of discussing proarietary land acauisition issues related to the Proposed Bristol Redevelopment Proiect., DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMINUTI'EE MINUTES -MARCH 31, 2004 PAGE It The oxen session of the EDC Meeting resumed at 7:50 P.M. VIL Recent development proposals were not reviewed because of time constraints. VIII. The communication items which were included in the EDC packets were acknowledged. IX. There being no further business, the meeting was adjourned at approximately 7:52 P.M. The next EDC meeting Is scheduled for Wednesday. Anrf12& 2004 at 8:00 P.M. In Room 2404. Civic Center. Respectfully submitted, Aorris E. Robinson Economic Developmcn Planner JOINT ECONOMIC DEVELOPMENT CO:► MWME AIND PARKING COMhu it it mr. MEETING '%HN-UTES OF UTDNESDAY 1LARCH 31, 2004 ROOM 2200-6:00 P.M. MIC CENTER MEMBERS PRESENT: EDC: Aid. Feldman, AUL Moran, AM. Newman Ald. Wynne, Aid. Rainey, Marvin Juliar, Barbara Puta, Alice Rebechini PC: Ald. Newman, Aid Bernstein, AkL Wynne, Paul Giddings, Michael Ginter, Jonathan Permaa. David Reynolds,George Woolridge MEMBERS ABSENT: Marvin Juliar-EDC, Larry Rafel-PC MMSIDING OFFICIALS: Ald. Feldman, Chair-EDC, Aid. Newman, Chair -PC OTHER COUNCIL MEMBERS PRESENT: None STAFF PRESENT: Roger Crum, Judith Aiello, Jean Baucom, Patrick Casey, Keith Fujahara, David Jennings, Dennis Marina, Morris Robinson, Max Rubin, Lloyd Shepard, William Stafford, James WolinsYi OTHERS PRESENT: James Klutznick, Maury Fisher, Martin Stern William Walsh and Associate, Diane Williams, Ann Dieaner, Richard Peach Summary of Actions: I. Aid. Newman called the Parking Committee to order at 6:15 P.,%L and the members of both Committees introduced themselves. Judith Aiello began with a brief miew on the status of the old Sherman Avenue municipal parking garage. David Jennings, the Public Works Director, has engaged the sati-ices ofa structural engineer to provide monthly safety check-ups related to the soundness of the garage. During the past month, additional support shoring has been affixed and the Bose lighting fixture on the roof has bees removed. 'The roof now has been closed to parking to eliminate potentially dangerous situations. Ms. Aiello stated that for various reasons, the original thinking on the part ofthe Parking Committee was that it would be beneficial to close the entire garage at this time. However, after discussing the, possibility with the PC Chair, the Chamber of Commerce Executive Director and the Evmwk director, a consensus was reached that it would be best to keep the f nx-tional parking garage as is for the time being. It is anticipated that the garage will be demolished in three or four months. DRAFT-NOT-APPRO LED ECONOMIC DEVELOPIMEtiT COMMITTEE MINUTES -MARCH 31, 2004 PAGE 2 Staff has been meeting with an Optima Development principal and determined that there maybe as many as 345 parking spaces which may be made available to the public in the new garage for Optima"s new residential development on Sherman Avenue. These spaces could be available for the period of time that it takes to complete the condominiums in the development project. Additional discussions are planned for the near future and it is hoped that a proposed parking agreement will be ready for presentation at the next meeting. There were no questions concerning the presentation and Aid. Newman announced that the PC portion of the joint meeting was over. Aid. Newman stated that a significant discussion on these parking issues, particularly the possibility of closing and demolishing of the old garage, had been anticipated and that %-as the reason for the joint meeting. But as presented, late breaking circumstances precluded the need to do so at this time. At this point Aid. Newman concluded the PC portion of the joint meeting and presented Aid. Feldman to begin the EDC portion. 1. Aid. Feldman convened the EDC Meeting at approximately 6:30 P.M. and the EDCMeeting minutes of January 28, 2004 were unanimously approved by the members. II. Although the next item on the EDC agenda was for an update on the "Downtown Visioning Process", Judith Aiello stated that the Sherman Plaza development project would actually be discussed next. Initially the presentation will be in open session and then move into closed session. Ms. Aiello introduced the Sherman Plaza development project principals, Mr. James Klutznick and Mr. Maury Fisher. Mr. Klutznick began the update. 1 At the outset, Mr. Klutznick stated that the required financing for a revised version of the project is eminent and should be completed by the end of April. The original version had provisions for a considerably larger health club component and fewer condo units. However, now that a smaller health club has been incorporated in the project, and more condo units are added, serious financing negotiations have been allowed to proceed. Also, proceeding without a health club component is an option. The negotiations are significant enough to the point that concluding the loan acquisition process could occur perhaps as soon as the end of the week. The developer anticipates starting the project sometime during the summer. Ms. Aiello stated that if the developer is able to provide their letter of financing commitment, staff maybe able to present the proposed summary of changes to the development agreement documents for EDC consideration at the April 28, 2004 EDC Meeting. Aid. Newman stressed the urgency as well as the need to proceed with this development project. III. By voice vote, the Economic Development Committee members voted unanimousIv to enter into Executive Session at 6:30 P.M. for the purvosc of discussing oroarietary land acquisition Issues related to the Sherman Plaza Redevelopment Prolect. DRAFT -NOT -APPROVED ECONOMIC DEVELOP?NENT COMMITTEE MINUTES -MARCH 31, 2004 PAGE 5 The oven session of the EDC Meeting resumed at 6:46 P.M. The waiting audience was allowed to renter the meeting room. IV. Judith Aiello provided the EDC with a brief update on the ongoing downtown visioning process. Ms. Aiello said that she, together with Dennis Marino and Diane Williams have been meeting with the consultant since the City Council approved the consultancy contract. Necessary planning sessions have been scheduled and a date for the concluding joint group presentation, consisting of the various group stake -holders, is currently being considered. V. The next agenda item was the Howard Street T1F District and Proposed Bristol Redevelopment Project. Ms. Aiello reminded the EDC that the City Council approved the planned development project, proposed by Bristol, slated for the long vacant parcel at 413 Howard Street, within the newly created Howard Street T1F District #5. When Ms. Aiello concluded her opening statement, Aid. Newman asked to be recognized. Aid. Newman stated that when the EDC voted to recommend approval for the planned development project, the EDC h ad n o t dea t hat t here w ould b e a r equest from t he d eveloper, for f inancial assistance from the City. Aid. Newman said that the amount of real estate tax revenue the project would generate was one of the appealing aspects of the proposal. it appears to Aid. Newman that at the time of the EDC vote there were some who knew of a substantial financial request but it was not obvious to him and several other members of the EDC. As such, Aid. Newman would have had a much different outlook on the zoning portion of the project, interjecting that not having complete information is a monumental issue with him. Judith Aiello stated that that staff has not withheld information from the EDC, adding that the issue is that the planned development stood on its own at which time Aid. Newman objected saying that it doesn't stand on its own when the project generates tax revenues which is considered a benefit. Ms. Aiello stated that when the project was first discussed there was no indication that there would be a need for assistance from the City except for required water main pressure improvements to adequately meet the needs of the planned development. After the first of the year, when staff could begin to review the TIF and the plan in its entirety, and the developer could better share their financials, it was then determined that as a rental project, it would prove to have a very thin profit margin. It was then that the developer approached the City with the request for assistance and preliminary discussions of the developer's financial needs began. The preliminary numbers are in no way final because staff has been trying different ways to package a proposal for a presentation to the EDC. What is being presented tonight is a tentative plan for issuing debt and providing payment up front iii a manner unlike any that the City has done in TIP districts before. This proposed, preliminarypay as you go plan would be similar to a sales tax revenue sharing plan except the source of the revenue would be generated from property taxes rather than sales taxes. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES -MARCH 31, 2004 PAGE 6 At this point Ms. Aiello suggested that the EDC enter into executive session to discuss the details. Aid. Rainey asked to be recognized prior to entering into executive session. Aid. Rainey stated that she would like to address Aid. Nm man's comments because it appeared to her to imply some people were privy to information while others weren't. Aid. Rainey said the first time financial projections were brought to her attention was only a few days ago but from the beginning the EDC was informed that a proposed redevelopment agreement was in the process of being drafted. This assertion was made numerous times in public meetings. Aid. Rainey further stated that she could not recall a single time that a TIF district development project when there wasn't some kind of developer project assistance provided from the City. Aid. Rainey advised the EDC that it is important to know that the most real estate taxes generated from the four lots designated for the proposed residential project was S 16, 044 and that amount is for the current year. The proposed development project is estimated to generate $700,000. It is a historical fact that only one building permit was ever issued for the four lots. Aerial photographs from the 1890's reveal that the lots look the same then as they do now. The impact the proposed project has had in the new TIF district is evidenced by recent real estate sales which have occurred within the new TIF boundaries. Aid. Rainey announced that the property at 807 Howard Street recently sold for $750,000. Next door to that sold building, 741 Howard Street, a problematic building which has cost the City thousands of dollars was sold two days ago for the sum of S 1.3 million. Immediately to the east of that property, there is a contract for the purchase of 339 Howard Street for the sum S 1.6. Millions of dollars of real estate sales have taken place within the new TIF district, all within the past 30 days. The proposed development project and the publicity it has generated i s t he i mpetus for t his never before seen activity. Aid. Rainey concluded her comments by urging the EDC to review this proposed project in an opfn and favorable way. Aid. Newman made the statement that when it is asserted that "we all knew a redevelopment agreement was being drafted", that speaking only for himself, he never heard the words redevelopment agreement associated with the proposed project. The effort to establish the TIF district was occurring before the proposed development was introduced and typically, the City has not provided assistance for residential projects. The circumstances concerning this proposed project is very different from the Klutznick project and whereas Mr. Stem was contracted to work on the Klutznick project and to keep the City Council apprised of issues, Aid. Newman only recently learned of Mr. Stem's involvement with the Howard Street project. Aid. Newman stressed the point that he had no idea that an agreement was in the process and that his enthusiasm for the project was based on the belief that the City would receive all of the real estate tax increments and that the proceeds would be used to acquire other properties in the new TIF district. Aid. Newman said that three other members of the City Council stated that they were also not aware of these circumstances. Ald Newman pursued the point that had he known that a request for assistance and that a development agreement was in progress, consideration of these issues would have had an of ect on his vote. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES -MARCH 31t 2004 PACE 7 Aid. Rainey reiterated the value of the project, stating that aside from the recent real estate sales, when this proposed S44.5 million project in one of the most problematical areas of the City is compared to the $90 million Hill project in the very desirable downtown, the City will be getting an excellent deal. The City will not have provided for tenant displacement and relocation costs, demolition cost, and parking requirements. There are no condemnation issues and building height restrictions. It will be a simple, neat and clean project. Aid. Newman asked Dennis Marino if he were working on a redevelopment agreement. Mr. Marino's response was no. Ms. Aiello stated that staff was not at the stage for a redevelopment agreement. Staff's position is that there is a development deal waiting, worthy of pursuing and to present the a preliminary idea to the EDC for consideration, and that is the point for the informational update tonight. Ms. Aiello stated that there is always a redevelopment agreement associated with a TIF project so that whatever public improvements are required, there is an understanding that they will be completed as part of the project. Ms. Aiello apologized for any lack of earlier communication Often times, issues are discussed with the alderman of the ward before the Test of the City Council knows of the plan, and it places staff and all involved in an awkward position. Perhaps the answer lies in the adoption of a policy from the City Council as to when to communicate to the full body. Aid. Newman interjected that the time to communicate is before the measure is voted on. his. Aiello concurred. To be clear, Aid. Newman stated he didn't want to know anything before the other aldermen. Aid. Feldman concluded the discussion by stating his displeasure with the idea that negotiations have been proceeding with the developer since December without the City Council being informed or at least the EDC. Having said that, Aid. Feldman stressed the point of other important issues regarding the proposed project as well as its excellent merits and therefore it should be separated from the debate as to whether the process has proceeded correctly or not. To settle the issue of when the City Council should be informed must be settled in another venue. V1. By wav of voice vote. the Economic Development Committee members again voted unanimously t o e nter I ato E xecutive S ession a t 7 :15 P.M. f or the purpose of discussing proprietary land acquisition Issues related to the Proposed Bristol Redevelopment Prolect. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES -MARCH 31. 2004 PAGE 11 The oven session of the EDC Meeting resumed at 7:50 P.M. VII. Recent development proposals were not reviewed because of time constraints. VIII. The communication items which were included in the EDC packets were acknowledged. IX. There being no further business, the meeting was adjourned at approximately 7:52 P.M. The next EDC meeting is scheduled for Wednesday. April 28: 2004 at 8:00 P.M. In Room 2404. Civic Center. Respectfully submitted, Moms E. Robinson Economic Developmen Plarmer 9 ECONOMIC DEVELOPMENT COMMITTEE MEMBERS PRESENT: MEMBERS ABSENT: PRESIDING OFFICIAL: OTHER COUNCIL MEMBERS PRESENT: STAFF PRESENT: OTHERS PRESENT: Summary of Actions: MEETING MINUTES OF WEDNESDAY APRIL 28, 2004 ROOM 2404-8:00 P.M. CIVIC CENTER Aid. Feldman, Aid. Moran, Aid. Newman Aid. Wynne, Aid. Rainey, Marvin Juiiar, Martin Norkett, Barbara Putta, Alice Rebechini Aid. Feldman, Chair None Judith Aiello, Dennis Marino, Morris Robinson, Max Rubin, William Stafford Ronald Kysiak, John Leineweber, Mary McAuley, Robert Rycldicki, Martin Stem, William Walsh and Mr. Golz, Robert Seidenberg 1. Aid. Feldman called the EDC to order at 8:03 P.M. 11. After noting and correcting two minor attendance errors, the minutes of the March 31, 2004 joint EDC and Parking Committee Meeting minutes were unanimously approved. III. Aid. Feldman stated that the next agenda item was for the EDC consideration of a financial assistance request from Renaissance Realty & Construction, Inc. The purpose for the financial assistance is for increased parking improvements at 1703 & 1711 Darrow Avenue, properties which ate undergoing rehabilitation. Mr. John Leineweber and Ms. Mary McAuley are the principals of this local development firm and they've attended the EDC Meeting to present an overview to illustrate the reasons for the financial assistance request and to answer questions. Mr. Leineweber explained to the EDC that he was in the final rehabilitation stages of the vacated Strange Engineering warehouse properties, creating seven, convertible live/work commercial spaces for smal l businesses. Mr. Leineweber's firm has successfully converted distressed buildings located in areas designated by the City as needful of economic development opportunities, into innovative adaptive reuse livetwork spaces. These projects have enhanced the communities and improved tax revenues for the City. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES-APRIL 28, 2004 PAGE 2 Using a 1 arge v isual a id d epicting a n artist rendering's of the 14,000 square foot project, Mr. Leineweber explained the scope of the rehabilitation activities and the limited parking issues which could seriously hinder the potential for its success. To improve the parking opportunities for the new tenets as well as an overall improvement for the immediate neighborhood, Mr. Leineweber has proposed changing the current four space parking area on the Darrow Avenue side into fourteen, non-exclusive spaces, including one space forthe disabled. The City will retain ownership of the public spaces. The City traffic engineer also expressed agreement with the concept but does not currently have budget resources for such a reconfiguration. Additionally, substantial landscaping with on going maintenance will be provided by the developer. The estimated cost for the entire project is $45,000. The developer will provide $15,000 and the request is for the City to provide the remaining S30,000. Mr. Leinewebber concluded his remarks and asked for questions. Aid. Rainey asked for a clarification on the number of signed tenants. Ms. McAuley said that currently they have seven rental spaces and five signed leases, of which three of the five are now occupying their spaces. Although initially there are no live in tenants because the area is zoned 12 which doesn't allow residential, a condition the developer's would like to see amended. However, the units were designed to convert as when residential is allowed and as desired. Mr. L.eineweber also assured Barbara Putta that the landscaping will be far superior to what currently exists. Aid. Newman stated that the request had just been reviewed in the Parking Committee Meeting earlier in the evening and it was the consensus of that body that it was not within the purview ofthe Parking Committee to provide a grant of this nature and that the Parking fund was already short of funds adding that the request should d be handled in it's entirety at the EDC Meeting. Aid. Rainey stated that the request did not fit the norm for the CDBG Committee either. Staff initially suggested that the Economic Development fund should be used to contribute S 15,000 and that the CDBG should $15,000. At the April 20, 2004 CDBG meeting where the request was first considered, Aid. Rainey suggested that the request might better be served having the EDC provide $10,000, CDBG contribute S10,000 and the Parking Committee contribute S10,000. Aid. Feldman asked Dennis Marino if there was a sufficient enough balance in the EDC fund to accommodate the request. Dennis Marino assured the EDC that the funds were available. Aid. Feldman commented on the exemplary quality of a project completed in his ward by the developer and a brief discussion ensued. Aid. Moran simply said nice job and thanks for all of the good work performed in the City. The project is a good alternative to the loss of Strange Engineering. The discussion concluded with Aid. Newman making a motion to approve the recommendation to provide financial assistance in the amount of $30,000 to the developer for the purpose of creating increased and improved parking at the "Strange Lags" location. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES-APRIL 28. 2004 PAGE 3 Aid. Wynne provided a second to the motion and the measure passed with a unanimous vote. IV. Aid. F eldman s tated t hat t he n ext a genda i tern was a recommendation for the EDC to consider taking action for the dissolution of the Northwester Evanston Research Park (NUERP). Currently there is approximately $35,000 retained by the NUERP Corporation as its sole asset and it has been suggested by Mr. Ronald Kysiak that the funds should be divided equally, after administration expenses, between the City and Northwestern University. Mr. Kysiak took the opportunity to prepare a letter addressed to the City Manager and shared with the EDC, which outlined in detail the origin of the corporation, its successes and its disappointments. Attached to the letter was a time line document which chronicled the significant events that occurred from the formation of NUERP in 1983 through 2002. This document is available in the Planning Division office if anyone wishes to review its contents. Mr. Kysiak reviewed the contents of the documents with the EDC and advised the members that Northwestern University has already agreed to the equal split of the remaining funds. Although Aid. Newman disagreed with some aspects of the timeline and questioned the basis for an equal split ofthe $35,000 balance, he nevertheless made a motion to recommend approval of the dissolution of NUERP and to split the remaining funds equally with the university. Aid. Rainey provided a second and tho motion passed with a unanimous vote. V. Judith Aiello provided the EDC with a brief update on the Sherman Plaza redevelopment project. It is anticipated that the developer's financial issues will be resolved and that a commitment letter will have been obtained. The objective is to have the third amendment to the Redevelopment Agreement draft and a second amendment draft to the Public Construction Agreement ready for action at the next EDC meeting. Ms. Aiello stated that if all preparations for the drafts are completed in a timely manner, staff recommends convening the next EDC meeting one week earlier on May 19, 2004 so that the documents can be presented at the June 2004 Council meeting. The suggestion was acceptable to the EDC. VI. Ald. Feldman announced that next agenda item was an update on the Bristol Residential Development Project proposed for the new Howard Street TIF District #5. Although an Executive Session was scheduled for part of the update, Aid. Newman questioned the need for a closed meeting. Ms.Aiello stated that some of the data to be presented was proprietary information. The confidential proprietary data was included in the EDC packets. Aid. Newman's response was that the request for financial assistance could be discussed in open in a meeting. Ms. Aiello concurred adding that the issues concerning school districts reimbursements can also be discussed in open session. Ald. Newman continued to doubt the need for a closed session and that the EDC could discuss the financial request in an open meeting without discussing the developer's back-up proprietary information. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COhIMITTEE MINUTES-APRIL 28, 2004 PACE 4 Aid. Feldman asked Marty Stem, the lead US Equity consultant to the City to begin thepresentation. Mr. Stern informed the EDC that he recommends approval for the financial assistance proposal requested by the Bristol Development firm for the 221 residential rental unit development planned for Howard Street. The projected rental revenues will generate relative low returns for the developer. Staff analysis of the firm's financials verifies the return, which is projected to be slightly above 7%. The revenue projections indicate that it will take at least five years for the developer to realize an objective of 8% return and will probably never make 9% for the project. The developer is basically asking for relief from real estate taxes for the first five years. If granted, the benefit of real estate tax relief will accomplish two crucial objectives. First, it will allow for the certainty of attracting investors for the project and secondly the project will be completed only if it gets the relief. Mr. Stern then explained the mechanics of the proposed real estate tax relief formula. For the fist five years the developer needs to receive 100% of the real estate taxes. Starting with the sixth year the amount of the real estate taxes due the developer will be incrementally decreased each year until it is ultimately reduced to zero in the twelfth year. Mr. Stern reiterated the advantages to the City if the project is completed and added that each year after the fifth year; the City will begin to benefit from the real estate taxes and by the twelfth year will receive 100% of the revenues. If the developer converts any of the units into condominiums at anytime during the relief period, the agreement will stipulate that a portion of the financial benefits will be repaid to the City, on a sliding scale. A difficult issue related to this project, which must now be considered for the first time in a TIF district, is the recent addition of statutes to T1F regulations stipulates that the school districts are entitled to a certain amount of the real estate taxes for each school age student that moves into a TIF assisted residential development within the newly created TIF district. In this case, the City of Evanston would be required to provide an annual reimbursement of approximately S 10,000 for each District 63 student and approximately S 16,000 for each District 202 student that happens to move into the Bristol residential development project. Mr. Stern added that there is a reimbursement limit of 27% of the total real estate taxes for high school students and 13% for elementary students. Because it is not possible to know how many school age children will reside in the new development, potential underwriters and investors for the project will see the reimbursement issue as additional risk exposure and the developer will have a verydifficult time obtaining the necessary financing for the project. Mr. Stem then articulated staff's recommendation. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT r'O1%IN1 TTEE MINUTES-APRIL 28, 2004 PAGE 5 Inasmuch as the school districts have the option to delay or waive the reimbursement entitlements, staffs objective is to obtain the endorsement from the EDC to negotiate with the two school district boards to exercise the waivers. The reason that the school boards maybe agreeable to the proposal is because as it currently stands, if the project doesn't go forward they will receive nothing. With the EDC endorsement, perhaps the City Council will ask the school districts to favorably consider delaying or waiving the entitlements during the proposed period. Aid. Newman recounted a recent incident where he encountered a member of the P.T.A. who complained that the TIF's are ruining the schools. in addition Aid. Wynne referenced a letter in the Evanston Review from the president of one of the school board which placed the blame for the schools financial difficulties on not receiving anyrevenues from the TIF districts. Ald. Newman said that as long he has been involved w ith T 1F d istricts, t here h as b een a b asic a nd fundamental misunderstanding of TIF districts on the part of the school boards. There have been instances where developments that are not in TIF districts, such as Horne Depot which is a sales tax district, that are erroneously identified as being a TIF project. It is evident that there is a sufficient level of misunderstanding of the concept of the increment within the school boards. Aid. Newman added that he has no objection to proceeding with negotiations with the school boards, but offered another alternative, suggesting the risk should not be placed on the City, but rather the risk should be borne by the developer. Marty Stem stated that it is his opinion that the developer can absorb the risk. Aid. Rainey stated that the school districts are sharing approximately $10,600 between themselves and the county in real estate tax revenues from the four lots. If the financial assistance proposal for the project is implemented, within five years, realized revenue from the project could be upwards of S500,000 and that appears to be a good trade off for the school districts. Mr. Stem agreed, providing the school boards can be convinced and that the proposal is not Iost in misunderstandings. Aid. Newman again cautioned that if the school districts agree to get their revenue share later, the proposal would still diminish the ability to do other things within the TIF district, such as acquiring additional properties. In the opinion of Aid. Newman the developer should pay the Schools out of their proceeds and the City should not assume the risk. Aid. Moran agreed with the premise that the City should not assume the risk but urged the EDC to support the proposal to negotiate with the School district boards. Ald. Rainey concurred adding that when the two superintendents were originally advised of creating the Howard Street TIF District, they appeared to view this TIF District more favorably than the others. After continued discussions the EDC concluded that negotiations with the two School Districts was a crucial first step and a unanimous decision was made to support the proposal to pursue negotiations as soon as practicable. The results of the negotiations will be presented at the next EDC meeting. -tee •".t .' {r ` 6. DR-iFT VOT-APPROVED ECOYOWC DEVELOPMENT COAL'1U TEE NIE UTF.S-APRIL 28, 2004 PAGE 6 Mr. Stern asked Mr. Robert Rychlicki who is the TIF consultant to the city to confirm the accuracy of the information as presented. Mr. Rychlicki advised the EDC that the content of the T1F statute information regarding school districts as presented was corroct. The EDC did not enter into executive session. VII. There being no further business, the meeting was adjourned at approximately 9:00 P.M. Tde next scheduled EDC meeting is for Wednesday. Mav 26. 2004 at 8:00 P.M. in Room 2404. Civic Center. Y M�I Robinson Fic Development Planner ECONOMIC DEVELOPMENT COZ♦1MITTEE MEETING MINUTES OF WEDNESDAY MAY 19, 2004 ROOM 2404-8:00 P.M. CIVIC CENTER MEMBERS PRESENT: Aid. Feldman, Ald. Moran, Ald. Wynne, Aid. Rainey, Martin Norkett, Barbara Puta, Alice Rebechini MEMBERS ABSENT: Aid. Newman, Marvin Juliar PRESIDING OFFICIAL: Aid. Feldman, Chair OTHER COUNCIL MEMBERS PRESENT: None STAFF PRESENT: Judith Aiello, Dennis Marino, Morris Robinson, Susan Gudecly," Barbara Zdanowicz OTHERS PRESENT: Robert Rychlicki, Martin Stern, William Walsh, James Klutznick, 11 Maurice Fisher, Tim Anderson, John Terrell Srrmmary of Actions: I. Aid. Feldman announced a quorum and called the EDC to order at 8:07 P.M. H. The EDC Meeting minutes of April 28, 2004 were unanimously approved.' I` M. Aid. Feldman stated that the first agenda item was the consideration of the' financial' assistance request from Bristol Development L.L.C. for their ftoward Street Residential Redevelopment Project. Action on the request was postponed at the April 28, EDC Meetira to allow Mr. Marty Stern, the lead US Equity consultant to the City and key staff members to meet with representatives of the twd school districts and to obtain support for the request. - Ald. Feldman asked Judith Aiello and MartyStem to begin the presentation. Ms. Aiello provided the EDC with a brief review of the financial assistance request from Bristol which will allow the 221 unit residential project to be successful. Ms. Aiello said staffand Marty Stem complied with the EDC directive to meet with members of both school districts. The purpose for the meeting with the school district representatives was to request a multi -year waiver for the mandated education reimbursements for school age children who might move into the proposed Howard Street residential development project. The reimbursement stipulation was recently included in the state's TIF District statutes, and the legislation mandates compensation from the City for those children who move into residential developments that received direct T1F district assistance. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES -MAY 19, 2004 PAGE 2 However, school districts have the option to waive the requirement if they so choose. The City Manager, Roger Crum, Dennis Marino, William Stafford, Judith Aiello and Marty Stem comprised the team that met with the District 65 Superintendent Hardy Ray Murphy, CFO Lutaf Dhanidina and the District 202 CFO, Jeffery Taggart. The representatives were provided with a broad review of each T1F district, with particular emphasis on the Howard Street project. Mr. Stern also explained the proposed real estate tax relief formula, conceived to provide financial assistance to the developer and enable the residential project to proceed. At the conclusion of the presentations, staff presented the request to the school district representatives to waive the reimbursement requirement. Staff also suggested that if the waiver was approved, the existing inter - government agreement between the City and the school districts would be amended immediately to a new three year contract with the option for a second three period. In addition, staff' offered to increase the annual $600,000 contribution which the City provides to the districts, to $800,000. Stab' also advised the school representatives that all available data concerning all of the recent condominium developments in the City indicate very few school age children are residing in the units and that it is estimated that the Howard Street units will have only a few eligible children. Although the school districts representatives were not able to make a decision at the time of the meeting, they are open to on -going dialog. City staff offered to meet with the respective finance committees and Dennis Marino and William Stafford subsequently met with the District 65 Finance Committee. The District 202 Committee is scheduled to meet tomorrow, May 20, 2004 and the waiver request is on its agenda. Ms. Aiello concluded by asking the EDC to recommend 1.) Approval of the request from Bristol Chicago to rebate 100% of the incremental real estate property taxes for a period of up to five years so that an 8% rate of return may be achieved on the project; 2.) authorize staff to draft an amendment to the Intergovernmental Agreement for a three year period with an option for a second three year period and to increase the annual compensation from $600,000 to S800,000; 3.) Authorize staff to draft a Redevelopment Agreement with Bristol Chicago for the redevelopment of 413421 Howard Street, and 4.) Authorize staff to move forward with planning for the necessary public improvements for the development of this project, the water main In particular, which must be completed for the redevelopment project. (A memorandum summarizing the action items for approval was included in the EDC packet). AId. Feldman asked if the school districts had any contingencies related to the waiver request. Ms. Aiello said that if the agreement is approved and the project proceeds, the District 202 representatives requested a provision should be added to the amended agreement which would allow for re -opening negotiations, if for any reason, the number of school age children in the development is significantly higher than estimated. Staff has suggested that, in concert with Bristol, an annual census could be performed and the results presented to the school districts. DRAFT NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES -MAY 19.2004 PAGE 3 Mr. Stern once again reiterated that the proposal to the school districts is a positive plan. Aid. Rainey added that if the development project proceeds and the school districts chose not to accept the amended agreement plan, what ever reimbursements (if any at all) wouldn't be realized for several years. Aid. Feldman reminded the EDC that each of the TIF districts were conceived and established to improve real estate tax revenues for the benefit of the schools. Aid. Feldman asked for a single motion to approve the multi element request. Ald. Rainey moved approval for a recommendation to the City Council to approve the requests. Aid. Moran provided a second and the motion was passed with a unanimous vote. Ald. Feldman thanked the principals of Bristol Development and stated the City looks forward to an excellent project. III. Next, Aid. Feldman welcomed the members of the Klutznick/Fisher development team fora status update on the Sherman Plaza Redevelopment Project. After entertaining some questions from members of the audience, Ms. Aiello addressed the Committee and referred their attention the status summary memorandum, recommended amendments to the Development Agreement and the Public Improvement Construction agreement which were included in the EDC packets. Ms. Aiello advised the EDC that the development team was now prepared to discuss the amendments, construction revisions and the financial status of the project. Mr. Tim Anderson, president of Focus Development and a partner in the Sherman Plaza Project began by advising the EDC that a letter of commitment had been obtained from their lending institution which will also be the sole lender providing the financing for the entire project. This major hurdle was overcome primarily by the construction design changes which calls for more residential units and less retail space, and those changes will be outlined later in the presentation. Aid. Feldman asked if the Commitment Letter was contingent on further negotiations with respect to a health club. Mr. Anderson said the commitment letter is not contingent on further negotiations fora health club. The contingencies that apply are based on the number of pre -sales, an objective that has already been met, and attaining a certain percentage of retail leasing levels. The developer are now in the final negotiation stages of meeting the pre -leasing requirements. The developers believe that these conditions make for a very firm commitment. Aid. Feldman asked if there were any other impediments preventing the start of construction. Mr. Anderson estimates that it will take 45 to 60 days to finalize all loan and Iegal documents and at that point construction should start. The razing of the garage will begin at that time also. Mr. James Klutznick next provided the EDC with an update on the pre -leasing. activities. Mr. Klutznick advised the EDC that the redevelopment project has approximately 156,000 square feet of commercial space either in the process of lease negotiations or as finalized deals. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES -MAY 19.2004 PAGE 4 Now that the Commitment Letter has been obtained, finalizing the leasing process will proceed at an even faster pace, particularly with regard to the highly desirable comer retail spaces. Ald. Feldman asked for the status of the health club lease. Mr. Klutznick stated that they are in the final negotiation stages and it is anticipated that within the n ext w cek o r t wo t he i ssues w ill b e r esolved. M r. Klutznick then introduced Mr. John Terrell to continue with the presentation. Mr. Terrell provided the EDC with an overview of the redesign changes proposed for the development. Using visual aids, Mr. Terrell demonstrated how the design changes were incorporated. Essentially the size of the original proposed health club was reduced which in turn allowed for an increased number of residential units. The reconfiguration will now have an additional thirty-three loft units, up from 220 to 253 total residential spaces, and the new units will wrap around the second floorroof garden. The redesign made the project more appealing to potential lenders and hastened the commitment process. Total retail space has shifted to 156,000 square feet of which 90,000 square fed will be situated on the second floor with the health club occupying 60,000 square feet. Eighty percent of the retail space, including the health club is currently committed for lease. Ald. Feldman asked if the number of garage spaces changed. Mr. Terrell said the number of spaces remains the same. However, three hundred and three spaces have been purchased by the developer for the residential units. Ald. Rainey asked why there was a need by the developer to spend an additional $3,000 per space to finish the parking spaces. Mr. Terrell stated that there were certain design requirements to enable the spaces to be used by the condominium owners. The spaces have to be secured so overhead security doors have to be installed. Screening around the parking area, security cameras and other security measures will also be implemented. Additionally, a separate elevator will have to be included in the plans. These additions will have to be repeated on six floors and the total cost is approximately $3,000 per space. Ms. Alice Rebechini asked if any part of the development nest on top of the garage. The response was no. Ms. Rebechini than asked how significant is the value engineering component for the project. Mr. Terrell started that, after consulting with engineers in the "design/build community" and with the help of their review, contractors were contacted for their input. It was determined that a project of this scope would require significant value engineering. Ms. Aiello added that it is imperative that the City ensures that the cost associated with the project is as accurate as possible. Ms. Rebechini stated that her primary concerns are that the duality of the new garage is not compromised in any manner and that delays can cause the value engineering costs to escalate. Ms. Aiello assured Ms. Rebechini that the garage will not be compromised and that staff is aware that time is critical and all efforts will be made to minimize delays. Ms. Rebechini then asked for a clarification of the amount of the $3.2 million financial adjustment. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT CONIMITTEE MINUTES -MAY 19, 2004 PAGE 5 The developer assistance was initially for $1.9 million. Mr. Stern informed the Committee that the demolition cost was S 1.9 Million based on a formula associated with the total square footage of land to be cleared and the allocation of demolition costs. In addition to this amount, staff is recommending reimbursing the developer for the relocation cost associated in acquiring the land as the City has don in other TIF development projects. The $19 million is part of the $3.2 million request. After addressing any remaining confusion the EDC was assured that the total amount of the request is for $3.2million. Aid. Feldman asked if the downsizing of the total retail space and the increased number of residential units compromise in any manner the revenue to the City and the ability to service the bond debt. Ms. Aiello referred to exhibit A, a joint memo from her, Roger Crum and Bill Stafford which addressed that concern. Ms. Aiello advised the EDC that Robert Rychiicki, a consultant for the City, recalculated the financial projections based on the changes and the results were an obvious reduction of sales tax revenue but not materially enough to make much of a difference. Overall projected revenues remain sufficiently adequate to meet all debt obligations. Aid. Wynne asked for a reasonable timeline as to when demolition of the garage and construction will begin. Ms. Aiello said that the un-amended current documents stipulate the swapping of the land before the demolition of the garage. The amended document will allow the demolition to proceed before the land swap. Staff will meet with the Parking Committee to request approval to demolish the garage to save time. If the Parking Committee agrees, then when the amended documents are introduced to the City Council at their May 244, 2004 meeting and approved an the June 14 Council Meeting, it is anticipated that the demolition and construction will commence by the end of August. There is a provision in the documents stipulating that if construction hasn't begun by September 15, 2004, then the developer is compelled to clear and grade the site and be made suitable for holiday surface parking. If this scenario occurs, the developer would not have an option to start construction until after the first of the 2005 year. Aid. Wynne then asked for a timeline for construction. Mr. Klutznick said that twenty to twenty-four months is the expected period for completion. The garage will be erected first. Ms. Aiello informed the EDC that because the design changes were so significant, the proposal was going to nonce again be presented at a special Plan Commission Meeting for approval. The goal is to have all approvals for the amended documents completed at the June 14, 2004 City Council Meeting. Aid. Feldman asked for the size of the loft units. Mr. Klutznick said that there will be 33 high ceiling, single story loft units, and each averaging approximately 1,500 square feet. Ms. Rebechini asked Mr. Stern if in his judgment is it realistic to expect the loan documents to be completed in 45 days. Mr. Stem response was that the developers actually had 60 days but that it was still an ambitious schedule. DRAFT-NOT-APPRO PED ECONOMIC DEVELOPMENT COMMITTEE MINUTES -MAY 19, 2004 PAGE 6 Within that time frame the developers will definitely have to push hard to get the loan negotiations accomplished. Aid. Feldman asked Ms. Aiello to restate the request from staff for action. Ms. Aiello said that the request is:1.) for the EDC to recommend City Council approval of the Third Amendment to the Redevelopment Agreement; 2.) Recommend approval of the Second Amendment to the Public Improvement Construction Agreement; 3.) Recommend forwarding both documents to the City Council with the condition that consideration by the Council not occur until the Commitment Letter for the Financing of the Project is made evident; 4.) Authorize staff and consultants to continue to Value Engineer the Project; 5.) Authorize the City Manager to negotiate any additional conditions which are necessary to move the project forward and to report any such actions to the City Council; 6.) Direct staff to continue reporting to the EDC each month regarding the progress of the project, and 7.) Request the Parking Committee Inform the EDC as to the demolition disposition of the Sherman Avenue Garage and encourage cooperation with the developer to expedite its demolition. Aid. Wynne made one motion for approving all of the request elements and Aid. Moran provided a second. The motion was then passed with a unanimous vote. V. Aid. Feldman thanked the development team for the presentation and said he expects them back in two months. 'There being no further business, the meeting was adjourned at approximately 9:00 P.M. The next scheduled EDC meeting is for Wednesdzv.June 23. 2004 at 8:00 PAL in Room 2404. Civic Center. c ully su 2,, Morris E. Robinson Economic Development Planner ECONOMIC DEVELOPMENT COMMITTEE MEMBERS PRESENT: MEMBERS ABSENT: PRESIDING OFFICIAL: OTHER COUNCIL MEMBERS PRESENT: STAFF PRESENT: OTHERS PRESENT: Summan' of Actions: MEETING MINUTES OF %'EDNESDAY .TUNE 23, 2004 ROOM 2404-8:00 P.M. CIVIC CENTER Aid. Feldman, Aid. Wynne, Aid. Rainey, Marvin Juliar, Martin Norkett, Barbara Puta, Alice Rebechini Aid. Moran, Ald. Newman Aid. Feldman, Chair Aid. Jean -Baptiste Judith Aiello, Dennis Marino, Moms Robinson, Susan Guderly Ronald Kysiak, John Leineweber, Mary McAuley, Ronald Keysiak & Delores Holmes-ECDC at -a! I. Aid. Feldman called the EDC to order at 8:10 P.M. H. The minutes of the May 14, 2004 EDC Meeting were unanimously approved. III. Ald. Feldman stated that the next agenda item was the annual program report from the Chicago's North Shore Convention & Visitors Bureau (CNSCVB) leading to arequest for continued funding support for their fiscal year July], 2004 to June 30, 2005. Ald. Feldman asked Mr. Paul Giddings, CNSCVB Board Chairman to begin. Mr. Giddings thanked the EDC for the presentation opportunity and introduced Ms. Maria Berg -Stark, the CNSCVB Executive Directorwho continued with a report on the previous year activities. Ms. Berg -Stark informed the EDC members of the extensive advertising placements in various industry magazines and collateral material, all of which featured positive aspects of Evanston. Ms. Berg -Stark shared copies of the ad pieces, highlighting the relevant pages/texts and color photographs pertaining to the City. Ms. Berg -Stark stated that during the past year, over 25 million impressions were made in the various print publications in Illinois and the mid -west. The CNSCVB has been aggressively promoting the North Shore and a public relations firm has been hired to assist with the effort. The concerted effort has produced significant exposure, of which one example is a feature story on Chicago's North Shore. DRAFT-NOT--APPRO t ED ECONOMIC DEVELOPMENT COMMITTEE MINUTES -JUKE 23, 2004 PAGE 2 That feature story was printed in the April 2004 edition of %Iidtivest Living Magazine and Evanston was particularly note as a most interesting community and six page spread was devoted to City attractions. Midwest Living magazine has a quarterly circulation of 900,000 and the subsequent telephone calls generated by the article have been beneficial. Another public relations success arose from negotiations with the Windy City Visitors Guide, which agreed to a front page cover story promoting the North shore area. The main emphasis of the story was the City of Evanston and dining. Also, inside the publication were two pages of advertising from the area. The Windy City Visitors Guide is positioned in over 50,000 hotel rooms and 10,000 office buildings throughout Chicago and the Midwest. On the local level, the CNSCVB teamed up with North Shore magazine which has a circulation from 50 to 2511 miles outward. The number of area festivals, entertainment events and arts venues were heavily promoted in the magazine. To compliment the CNSCVB promotional efforts across the mid west which includes the Milwaukee Journal Sentinel, Ohio Publications, and Michigan Living, a calendar of events was produced on a trade-off basis with the North Shore Magazine. This past May, a calendar of North Shore summer arts and festival events covering the period of May thru October, was published in the Chicago Tribune's Metro Section and Tempo Sections. The Tribune circulation reached 745,000 households throughout the state. Berg -Stark then informed the EDC that the Governor has proposed drastic cuts in the tourism budget which may be as much as 50%. The impending budget cuts prevented the CNSCVB form repeating the calendar printing for a planned second half of the summer. As a result o f t he a ggressive a dvertising a nd t he s trategic focus o n t he N orth Shore area, the CNSCVB has experienced tremendous success in with their promotion efforts. Ms. Berg -Stark also produced a graph developed by Online Booking Services which tracked the growth of CNSCVB web -site inquiries from .tune 2002 thru 2004. Ms. Berg -Stark stated that the significant growth is directly related to the aggressive ad promotions, trade show participation and public relations campaigns conducted by the CNSCVB. Ms. Bcrg-Stark also informed the EDC of a partnership campaign conducted with the Chicago Botanic Garden which proved to be a large draw for the participating CNSCVB communities. A half page, four color ad was also developed for 200,000 Botanic Garden brochures which are given to all visitors of the facility. Atd. Rainey asked Ms. Berg -stark for a clarification the oft repeated phrase of "we negotiated an ad". Ms. Berg -Stark said that basically the ads are obtained for services in kind rather than payment in cash. For example, the Chicago Botanic Gardens CNSCVB membership dues were reduced from S 1,750 to 51,200 per year. Ms. Berg -stark displayed last year's CNSCVB Visitors Guide, of which 100,000 were printed and that quantity is near depletion. New guides are currently being printed. DRAFT -NOT --APPROVED ECONOMIC DEVELOP;IIENT COMMITTEE MINUTES-JUNE 23, 2004 PAGE 3 Ms. Berg -Stark said that according to state of Illinois officials, the CNSCVB Visitors Guide is the third most popular guide in the state. Twenty-five thousand of the guides were distributed through the various visitors' centers across the state. The rest are distributed through the CNSCVB offices, area hotels, area shops, conventions and trade shows. Aid. Feldman asked Ms. Berg -Stark to identify the first two most popular visitor guides. Ms. Berg -Stark said Chicago was first and Dupage was second. Secondly, a dining g uide w as p ublished 1 ast year and n ew a nd I arger v ersions for b oth g uide publications are currently being printed for the new -year and will be available in a few weeks. Ms. Berg -Stark said second to last but not least, just as aggressive efforts were made to advertise to the leisure market, a concerted effort was made to advertise to the corporate meeting market which is very important for the hotels. Primarily ads were placed in two publications, the Illinois Meetings and Events magazine and Midwest Meetings Magazine. The CNSCVB has fulfilled information requests for approximately 11,D00 inquiries from meeting planners across the mid -west. Everyhotel in the CNSCVB area has booked corporate business as a result of these efforts. The final marketing tool was a four minute color DVD of the area produced by the CNSCVB. The DVD won a Governors award for a production of its type. EDC member Alice Rebechini noted that on the events calendar, all of the arts festivals are scheduled for July 18. and 19 and wanted to know why there isn't a coordinated schedule to avoid conflicts. Ms. Berg -Stark said an effort was made to avoid schedules for the new year but because dates for events are made a year or more in advance it was not possible for the CNSCVB to intervene and prevent scheduling conflicts. Request for community calendars are made as far in advance as possible which allows for proactive opportunities to plan dates and events in a more compatible manner. The participating communities are now paying more attention to this issue because of the publications. Aid. Feldman added that amongst artist there is a tradition that certain art festivals occur during the same period every year and plan their activities accordingly. A gentleman in the audience who failed to identify himself asked Ms. Berg -Stark forthe name of the public relations firm that the CNSCVB engaged. Ms. Berg -stark identified the firm as AD Public Relations out of Highland Park and they were selected out of five candidates because the person who directs the firm is the ex public relations director for the Chicago Convention and Visitors Bureau. The CNSCVB contract with the PR firm contains a non -compete clause which prohibits them from representing another bureau in the state of Illinois for the life of the contract. Mr. Giddings continued the presentation, again mentioning the possibility of a government cut in funding which could mean the loss of approximately S 140,000 to the CNSCVB, and that possibility has been considered in the planning process. If the funds are not cut, which there is no certainty, the CNSCVB will have operating funds approximately equal to last year or about a S700,000 per year budget. Mr. Giddings also reminded the EDC that originally a satellite office was anticipated for Evanston. DRAFT -NOT -APPROVED ECO`OINHC DEVELOPMENT COININIITTEE MINLTES-JUNE 23, 2004 PAGE 4 After unsuccessful attempts to locate an affordable site, the realization is that the only way an office could be placed in the City was to share a space with another agency. Even though aground level site is preferable, some discussions were held with the Evanston Chamber of Commerce and Evmark regarding the possibility of sharing space but in the end the Chamber renewed their existing lease and Evmark chose to remain with them. On its own, the CNSCVB cannot currently afford a lease. Half the C. SCVB funding is derived from the state and those funds come with significant rules as to how the funds can be used and leasing a space is not allowed. The CNSCVB has some of the City provided funds lcft in the budget. As a reasonable alternative to having a staffed office, the CNSCVB is proposing to use the funds for the initial installation of two, state of the art, high- tech kiosks which will be internet connected, with additional units to follow. They will allow the user to access the CNSCVB and City web sites as well as allow the user to book rooms. The Village of Wilmette currently has installed first generation kiosks and there is another installation in the Old Orchard shopping center. The concept is to install tha first unit in the theater complex because of the high foot traffic pattern and the second location will be determined after a thorough analysis. The units cost approximately S15,000 apiece. Another use for the funds will be used in a program to "support the arts" in Evanston. Aid. Rainey asked about the possibility to persuade certain larger Evanston based businesses to sponsor the kiosks. Mr. Giddings stated that that initiative will be phase two of the plan. Aid. Feldman stated that it has come to his attention that there is a concern in the business community that all City businesses are not included in the CNSCVB web -site. Mr. Giddings said the new wcb-site has only been up and running for three weeks but there is a mandate to eventually list/ mention non -partner retail, touring and travel related businesses. Citing examples, Mr. Giddings doubts that each and every, non -related business will be included. However, in the Dining Guide, every restaurant is listed whether or not they are partners. Ms. Berg -Stark added that by August the complete list of businesses will be included on the still in the post conceptual phase but that list will be given to Mr. Giddings as soon as it is compiled. (l.) Aid. Feldman requested the list also be given to the EDC as soon as possible. Aid. Feldman asked if any representative(s) of Evanston businesses accompanied the CNSCVB presenters, who could provide testimony of the benefits derived from the Pr and marketing efforts. Ms. Berg -Stark stated that none were present but she did have a few testimonial letters from some hotels. Aid. Feldman stated that although it is too late for this year, in the future the EDC expects to have more than just two letters as evidence of the benefits. The EDC has a difficult time quantifying the success of the CNSCVB and the input from business people as to the benefits of the services provided is important for the EDC to hear. Ms. Berg -Stark indicated she had more letters and that she could compile them. (2.) Aid. Feldman asked his. Berg -Stark to forward the compiled correspondence to Mr. Dennis Marino. DRAFT -NOT -APPROVED ED ECONOMIC DEVELOPMENT COIWMITTEE MINUTES -JUKE 23, 2004 PAGE 5 Aid. Feldman advised the EDC that with the presentation, the CNSCVB is requesting renewed funding from the Economic Development Fund, in the amount of S60,000 for the new fiscal year, beginning Julyl, 2004 and asked for questions. EDC member Martin Norkett asked if the amount was the same as last year and asked how much the other communities contributed. Dennis Marina stated that the amount for last year was also for 560,000. Mr. Giddings informed the EDC that Skokie contributed St 10,000; Wilmette provided $10,000 and Northbrook gave S30,000. The amounts are based on hotel rooms and population. Mr. Norkett asked if a budget should hay a been submitted to reflect what was spent in fiscal year 2003-4. (3) Dennis Marino stated that he received that budget and that he would share it with the EDC members. EDC member Alice Rebechini stated that for the new fiscal year 2004-5, the EDC requires some form of quantifiable financial detail. Aid. Feldman added that if it is the desire of the EDC the request could be P.-Ad until the next EDC Meeting, at which time the information could be provided.' It was determined that a slight delay should not be a problem. Mr. Giddings made some mitigating comments as to why a budget was not presented and a brief discussion ensued. The discussion culminated with the EDC requesting (4) the CNSCVB provide financial detail which includes year to date expenditures and the over-all budget. When the EDC receives the financial data, the request will be considered at the July 29, 2004 EDC Meeting, EDC member Alice Rebechini suggested that for future presentations, the EDC should also be provided with quantification of results from the marketing efforts. Ms. Berg -Stark agreed adding that the information on marketing results is included in the news letters which are mailed quarterly. None of t he E DC m embers c ould r e call a ver r eceiving t he q uarterly n ews 1 etter. (5) Aid. Feldman requested copies of the last four news letters. Referring to last year's minutes, EDC member Barbara Pula asked about data indicating the percentage of closed leads from gross numbers of leads provided to hotels. The indication was that software was being obtained to capture such data, Ms. Berg -Stark stated that the soft ware was installed about ten weeks ago and the data conversion process is on going. It is anticipated that the process will be finalized in the next three or four weeks. (6) Aid. Feldman stated that at the point In which the data is fivalixed, the information should be forwarded to Dennis Marino. Aid. Feldman added that the important work done by the CNSCVB is greatly appreciated, but emphasized how important it is for the EDC to receive all supporting documents to justify the contribution of S60,000. Aid. Rainey suggested that in the future the CNSCVB staff should obtain the home addresses of the EDC members and mail the quarterly reports directly to the members. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES-JUNE 23, 2004 PAGE 6 Nevertheless, the letters should be once again included as supporting documentation in the annual presentation. Aid. Feldman thanked The CtiSCVB for the presentation and introduced the next agenda item. IV. Aid. Feldman welcomed representatives of the Evanston Community Development Corporation, (ECDC) and invited Ms. Delores Holmes, the lead presenter, to acknowledge the other members present. Ms. Holmes stated that some members of the ECDC board well as members of the community were present. Ms. Holmes informed the EDC as to how the ECDC organization was established in 2003 by second ward residents, business people land owners and other interest parties to begin dialogue on what kinds of desirable development activities were needed for the broaderChurch/Dodge area The group formed a board and met monthly, for several months. At this point Ms. Holmes asked all of the board members to stand and each member was introduced to the EDC, including Aid. Jean - Baptiste. Aid. Kent, though not present, was also indicated as member. In addition to the board members, other Evanston residents, many belonging to other organizations attended the ECDC meetings and provide support, particularly Mr. Ronald Keysiak of Evanston Inventure. Ms. Holmes mentioned that for the past three years the Plan Commission and city staff togetherwith community stake holders has been conducting a community planning process for a broad area within the fifth ward that includes the Church and Dodge area. Many involved with the ECDC have also participated in that process. As such, the ECDC board does not believe their activities and proposals' do not conflict with the Plan Commission focus. Rather, the ECDC %vants to move faster in achieving some goals. The ECDC identified three major needs in their targeted area and set objectives to meet those needs. Those objectives arc: 1.) to meet the need for significantly more affordable housing; 2.) tocreate alternative opportunities such as job training and apprentice program to provide alternatives other than the streets for the young men and women; and 3.) to develop a method to identify and nurture small businesses and create financial resources such as micro loan programs and a small business incubator. Ms. Holmes stated that among other reasons to W excited about the EDC initiatives thus far is the opportunity to use land owned by three principal property owners in the area, Sam Johnson, Bishop Wilson and Daniel Cheifetz, for redevelopment projects. School District 202 has also been involved with the planning process from the start and has included the athletic field on Church Street in the mix. The EDC has developed both long term and short term plans for the target area. Using visual map aids identifying the land ownership and artist renderings of the ECDC proposals, Ms. Holmes shared the ECDC short term vision with the EDC. (Copies of the proposals may be viewed at the Planning Division office in the Civic Center and also in the City Clerks office). Aid. Jean -Baptist mentioned that the group has also met with Superintendent of District 65, Hardy Ray Murphy. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES -JUKE 23, 2004 PAGE 7 The first project conceived by the EDC is to redevelop the northwest comer vacant lot at Church and Darrow (owned by Daniel Cheifetz). In addition activities have been started to revitalize the area. Two buildings located 1823 and 1917 Church Street and owned by Mr. Cheifetz are currently being renovated. Young artist from Zion institute were contracted to create murals and they can be viewed on Church Street near Sam's barber shop. Mr. Richard Coming a principal with HOVC has been engaged to create the affordable housing component. Ms. Holmes said that the purpose for the presentation is in part to advise the EDC of the support ECDC will need from the City, the state and federal agencies for the redevelopment concept. The offices of Congresswoman Jan Schakowsky, State Representative Julie Hamos and State SenatorJeff Schoenberg are kept apprised of the progress. Help from the City will include rebuilding infrastructure such as streets, sidewalks, street lighting, traffic signs, lights and parking. Also, support is sought in the form of reducing the cost of `for -sale housing', remediation of the vacant lot at Church and Darrow, and support in providing rehab grants and low interest loans to renovate affordable housing. Most importantly, support is being sought from the City to establish a Tax Increment Financing District (T1F) so that revenue can be generated to help revitalize the neighborhood. Mr. Ron Keysiak was asked Ms. Holmes to expound further on the purpose for establishing a TIF District in this targeted area. Mr. Keysiak stated that the desire of the group is to create affordable housing for working people like teachers, firemen and policemen. The intent is to find a way to build market rate residences and get the price lower, in the $180,000 range, and offered to workers with a family of four, whose income earnings are between S35,000 and $75,000 per year. This objective will not be easy to accomplish. The rent to own project is a compromise but you must also qualify financially to participate into that kind of program. The kind of residential projects the ECDC would like to promote would include multi -family town homes and condominiums with street level retail, maybe live/work spaces, all of which would increase the density in order to support more commercial/retail development. Also there is a need to attract more people with disposable income on that comer. A long term financing mechanism is required to make the concept work. The proposed project has a strong residential component, but the other two objectives of training for young people and minority business development accompanies the development. Mr. Keysiak said this complex and inter -related project that needs a long term equity source of investment income. Although some of the needed work can be accomplished by the ECDC, but support from the City, county, state and other agencies is paramount. It took forty years for the community to deteriorate and this proposed project will not be a quick fix, it will take ten to fifteen years to improve conditions in the neighborhood. The plan is reasonable and can be accomplished. The ECDC has site control for the initial development phase. A well known, competent housing developer is on board. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES-JUNE 23, 2004 PAGE 8 At least one bank, First Bank & Trust, has agreed to partner in the plan while others are expected to join. Other members of the Evanston Inventure Board have an interest in the proposed plan. The Latino and African -American communities are also working together for the success of the project. The high school and Dempster Street Merchant Association also believe the project has merit. Mr. Keysiak continued by illustrating how the proposed borders for a proposed TIF District were conceived. All of the vacant land within the target area was taken into consideration including the old railroad right of way, Church and Dodge, the ComEd site at Brown and Church, TapeCoate, Cahill Plumbing, Strange Lofts and areas on Dodge, between Church and Dempster, the high school athletic field and Mason Park. (A copy of the proposed TIF District Boundary is available forreview in the Planning division). Attempts were made to exclude existing, growing businesses. The ECDC is now asking the EDC if it will be favorably disposed to consider having a TIF district study performed to determine if the proposed area qualifies. Participation and input by the Public Works Department would also be desirable as well as any other input from other City agencies as to what else can be done to make the project viable. Aid. Rainey advised Mr. Keysiak that the Mason Park account is well funded and improvements should be made by using those funds. Mr. Keysiak was pleased to learn of the funds. At this point Aid. Feldman asked if there were any question. Aid. Rainey asked about the status of the high school parking lot. The artist rendering of the lot depicts a three story building. Mr. Keysiak and Ms. Holmes stated that the rendering was simply a long terns dream the organization has. Aid. Jean -Baptiste interjected what he believed to be the favorable sentiments of the City Council as related to brain storming sessions in previous strategic planning activities concerning the Church/Dodge area. Aid. Jean -Baptiste advised the EDC that it is apparent that the second ward is significantly represented in the proposed TIF District. Duringthe planning process, discussionswere also held with Ald. Kent who in turn has expressed support for the project. Aid. Jean -Baptist stated that the project represents the best opportunity to gain the total support needed to establish a TIF district and proceed with the development of the area. Aid. Jean -Baptiste concluded by stating the second ward fully supports the development initiative. The EDC representatives continued the presentation by providing a history of the community, how the community outreach activities were conducted and low neighbors provided valuable input. Considerable efforts were made to determine how best to configure the proposed development area and both short term and long term master plans were conceived. The short term master plan will primarily consist of infill structures erected on vacant sites. It is estimated that based on known vacant sites, approximately 120 residential units could be constructed and approximately 20,000 to 25,000 square feet of retail space can be created. DRAFT-A'OT--APPRO IVED ECONOMIC DEVELOPMENT CONUMITTEE MINUTES -.TUNE 23, 2004 PAGE 9 All retail would front on Church Street and Dodge Avenue. On grade parking would be positioned behind the buildings. In some cases, parking for residential units will be underground. With regard to the long term master plan, implementation will depend on the economic success of the short term master plan. If the entire area was completely built up, approximately S25 million in revenues could be generated over the life of the TIF district. More discussion followed with regard streetscape, architecture, retail set backs and types of services and benefits the proposal will create. Aid. Feldman asked i f there was a list of interested or potential partners such as financial institutions in the proposal. Mr. Keysiak response was the First National Bank and Trust is working with the organization and it is believed that other local banks will join in the effort. Also, the Board of Pension o f t he M ethodist C hurch h as a xpressed i merest. O ther m ajar a ntities i n the City will eventually be approached for participation. Sufficient resources have been accumulated to proceed at this time. Aid. Rainey expressed her excitement about the initiative but felt obligated to mention that one of the ECDC partners, Daniel Cheifetz, who has bought significant properties in the targeted area on Church Street and these properties, have become what are in effect filthy eyesores. Aid. Raineysaid she has personally reported him to the City's Property Standards Division on numerous occasions because of filthy conditions around the properties. The vacant properties have deteriorated since they were acquired by Mr. Cheifetz. Ms. Holmes advised Aid. Rainey that this issue has been addressed with Mr. Cheivetz and he has demonstrated his willingness to work with ECDC. Renovations and clean-up activities are already underway. Many summer activities are planned for the rejuvenated vacant lot at Church a nd D arrow. A id. !e an -Baptiste added t hat t he p roperties a caned by Mr. Cheivetz are planned to be integral in the development plan. Aid. Feldman stated that for as long as he could remember, there have been earnest people trying to solve the problem in this targeted area, but for unknown reasons the attempts have been unsuccessful. This new vision is the best effort at consensus and has proceeded further than any previous attempt. It is important for the ECDC to continue these efforts and for the City to offer support. At this point Ms. Betty Sue Ester who was seated in the audience urged Aid. Feldman to allow her to speak. Ald. Feldman ceded the floor. Ms. Ester identified herself and read a portion of the neighborhood planning Executive Summary portion of a Draft Can al-G reenbavRoad/Ridge Avenue Street Studv Area Resort, which defined the boundaries of the Plan Commission target area. Ms. Ester she only recently became aware of the proposed TIF District Boundaries and she obtained a copy of the proposed map. Ms. Ester wanted to know why it can't be arranged to have funds set aside for homeowners to access to renovate homes and create more affordable housing. More recently, Ms. Ester obtained a second copy of the map and realized that the size of the proposed TIF District had been reduced. Ms. Ester apparently took issue with the reduction in size and stated she advised Ms. Holmes of her concerns. DRAFT -NOT. -APPROVED ECONOMIC DEVELOPMENT COMMITTEE ,MINUTES-JUNE 23, 2004 PAGE 10 Ms. Ester stated that -we" (others were not identified) believed the first the proposed TIF District map was better because it covered the larger area ?its. Ester said that Ms. Holmes advised her that the reason the boundaries were reduced K as to eliminate private residences and to avoid unnecessary consternation by homeowners who might erroneously believe that their homes could be taken. Ms. Ester's argument is basically that whatever is being considered for the EDC proposal, the same should be considered for the Plan Commission study area, with an emphasis on making low interest loans available to property owners. This can be accomplished by adhering to the first boundary map. Ms. Ester stated that this issue has been discussed with Ald. Kent and that she and Ms. Holmes have agreed to host neighborhood mectings designed to explain Tax Increment Financing to the residents and alleviate homeowner fears. Ms. Ester expressed her desire to have the TiF study approved. Aid. Rainey advised Ms. Ester that the EDC does not know about the first map to which she was referring. Aid. Jean -Baptiste added that Ms. Ester's suggestion would be addressed by the ECDC committee and assured her that there will be further dialogue. Aid. Feldman stated that he hopes the community will come to a consensus of a boundary map, rather than having one imposed by the City Council and one not fully acceptable to all interested parties. AId. Feldman said what has impressed him about this project was the effort and attention put forth b v the participants and crating a situd::on wh ae it has become economically feasible to accomplish. However, the more demands placed on the project the more the feasibility will be stretched. It is important to get this project done. Ald. Feldman asked Aid. Jean -Baptiste to continue pursuing these issues. Ms. Terrie January asked to be recognized and rose to express her support for the project and her historical prospect ivc and other comments w= acknowledged by the EDC. Aid. Jean -Baptiste and Ms. Holmes provided a summation and once again asked the City for support for the TIF study and the presentation came to a close. EDC member Rebechini who is also a member of the Plan Commission, suggested that since the final hearing on the study area plan was only recently completed that abuts the EDC plan, that there should be an occasion where the EDC appear before the group that created the study plan and that dialogue should occur before the boundaries of a TIF District map are finalized and the a TIF study is completed. Aid. Feldman agreed that that interface needed to happen. Aid. Jean -Baptiste agreed to have dialogue with all appropriate parties and to have the ECDC group appear before the EDC Committee with a consensus trap at the July 28, 2004 scheduled meeting. Aid. Feldman stated that if the issues were resolved he believes the EDC should seriously entertain the favorable recommendation to conduct a TIF study. Ald. Jean -Baptiste expressed his willingness to do as the EDC recommended and added that his group is ready to move forward and he was concerned that political impediments might take precedent over the substance the project. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES -JUKE 23, 2004 PAGE 11, Aid. Feldman said that with all due respect it is important for the EDC and for the City to feel that there is a general consensus within the community about the direction it's headed. Aid. Jean -Baptiste agreed. Other members of the audience expressed their support for the project. Aid. Rainey asked Ms. Holmes if City staff had been involved with creating the proposed TIF District map. Aid. Jean -Baptiste stated that there was some interface with staff but more may be required. Aid. Rainey then informed the ECDC group of the new amendment to the state T1F statutes which requires annual payments to the school district for every school age child that moves into a TiF increment assisted residential property. The school districts have the right waive the requirement but there was general agreement that the statute could end hope for the project. Aid. Jean -Baptiste noted that they will continue to interface with the school districts. Aid. Feldman thanked the group for their presentation and continued with the agenda. V. Mr. Dennis Marino next provided The EDC members with a brief Main Commons shopping center redevelopment project updatc. It is anticipated that the grocery store will open by September, 2004. VI. The communication items included in the Committee member packets were briefly acknowledged. Aid. Rainey commented on the year to date construction value revenues collected by the City. Although the total was reflected incorrectly, far below the actual amount, Aid. Rainey remarked that the actual YTD figure of S127, 239,265. was a noteworthy accomplishment which should be highly publicized. Aid. Feldman agreed and asked Ms. Aiello to increase staff ef arts to provide press releases to the major Chicago newspapers and other communication outreach media. Ms. Aiello concurred. VII. There being no further business, Aid. Feldman adjourned the meeting at approximately 10:10 F.M. The next scheduled EDC meeting is for Wednesday. Julv 28.2004 at 8:00 P.M. in Room 2404, Civic Center. tfully Moms E. Robinson Economic Development Planner ECONOMIC DEVELOPMENT COMMITTEE MEMBERS PRESENT: MEMBERS ABSENT: PRESIDING OFFICIAL: OTHER COUNCIL MEMBERS PRESENT: STAFF PRESENT: OTHERS PRESENT: Summary of Actions: MEETING MINUTES OF WEDNESDAY JULY 28, 2004 ROOM 2404-8:00 P.M. CIVIC CENTER Aid. Feldman, Aid. Moran, Aid. Rainey, Aid. Wynne, Marvin Juliar, Martin Norkett, Alice Rebechini Aid. Newman, Barbara Puta Aid. Feldman, Chair Aid. Jean -Baptiste Judith Aiello, Dennis Marino, Moms Robinson Kimberly Wright, Ronald Kysiak, Delores Holmes & ECDC Members/Participants 1. Aid. Feldman called the EDC to order at 8:03 P.M. II. EDC Member Rebechini noted the incorrect spelling of Mr. Ron Kysiak's name in various places of the June 23. 2004 EDC Meeting minutes. After City staff member Robinson assured necessary corrections would be made, the June 23, 2004 minutes were unanimously approved by the Committee. III. The third agenda item was a carry over request for the annual funding renewal from the Chicago North Shore Convention & Visitors Bureau (CNSC&VB). Aid. Feldman asked Ms. Kimberly Wright to proceed. At the June EDC Meeting, the CNSC&VB was advised by the EDC to provide considerable additional information before reaching a decision to provide funds for the 2004-5 fiscal year. Specifically the request was for presentation of a budget for the upcoming year, an accounting for how the previous year's funds were used, quantification of benefits received by Evanston based businesses and testimonials and back copies of the quarterly news letters for the previous year. These items documents were included in the Committee packets. Ms. Wright began by asking for any questions regarding the material provided. Member Rebechini asked about the "Travel Bureau booking system" used by the CNSC&VB and if it was it exclusive or universally used by anyone. Ms. Wright stated that it is a system that allows one to go on line specifically to book hotel rooms only in this region. DRAFT -.SOT -APPROVED ECONOMIC DEVELOPMENT CONI'MITTEE MINUTES-JULV 28, 2004 PAGE 2 You cannot make airline reservations or other travel related arrangements. Other competing organizations can use the system. All booking leads are presented to the member municipalities and it is up to the hotels to individually pursue the lead. As of yet the CNSCV&B currently does not have the capability to break out data for each municipality, but it is anticipated that recently acquired soft- ware will enable the CNSC&VB to do so in the near future. Member Rebechini stated that there isn't a clear relationship between expense and economic benefit aligned with the Evanston community and it should be a questionable issue for the next year. In response. Aid Feldman stated that there are primarily two types of advertising; direct promotional offers and institutional trademark or brand marketing. The latter is difficult to measure, but one way to measure is by providing is to hear testimonials from business people who have benefited from the effort. Aid. Feldman added that he had believed some business owner were present. Ms. Wright advised the EDC that representatives from two Evanston restaurants were present, Dan Kelch from Lulu's Dim Sum & Then Sum and Paul White from Prairie Moon as well as the fait that fourteen testimonial letters from Evanston based businesses were included in the packet. Ms. Wright stated that the restaurant owners would like to speak before the EDC. Mr. Dan Kelch spoke first. Commenting from the perspective of a small restaurant owner without a private function venue, Mr. Kelch advised the EDC that he does not have the resources to generate sophisticated tracking data and even if he could it would be difficult to accomplish. Mr. Kelch assured the EDC members that his restaurant has benefited tremendously from the efforts of the CNSC&VB marketing activities. Lulu's is a successful restaurant and one of the reasons for its success is due to the efforts to cultivate every customer and every potential client base. The out of town leisure and travel market is an extremely important client base and the CNSC&VB is the only organization available to owners like himself, who are chasing those dollars. The Evanston based business owners in short, and particularly small concerns like him cannot afford to ignore any potential markets. Mr. Kelch also commented on how open and accommodating the CNSC&VB is to the smaller businesses and how his and other smaller entities input is sought and welcomed. Mr. Kelch stated that the CNSC&VB is the only cost efficient method that allows access and advertising opportunities to the convention and visitors arena. Mr. Keich emphasized the point that he counts on the CNSC& VB publications for exposure and their ability to book hotel rooms, booked hotels mean more traffic and potential clients for his business. In addition, the relationships the CNSC&VB develops with tour group operators and booking agents represents long term potential for bookings and repeat business in the future. Although at this point the CNSC&VB may not be able to specifically quantify results for dollars spent, its role is integral in bringing business to Evanston and they are the only organization performing in that capacity. Mr. Kelch concluded his remarks by high endorsing the CNSC&VB and asking the EDC to approve the recommendation for funding. Aid. Feldman thanked Mr. Keich for his comments. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES-JULY 28, 2004 PAGE 3 Mr. Paul white spoke next and his first comment was "ditto' while basically echoing the sentiments of Mr. Kelch. The Prairie Moon restaurant differs from Lulus in that it has the capacity to host larger gatherings. Mr. White also assured the EDC that the CNSC&VB has generated more traffic and potential business from the travel and leisure market for his restaurant and that the benefits continue to be valuable, particularly in the large number of leads provided and in the manner in which the CNSC&VB follow up on the disposition of the leads. Mr. White also asked the EDC to favorably consider funding the bureau for the new fiscal year. A brief discussion ensued culminating in the consensus by the EDC that quantifiable data should be mandatory in the future. Ms. Wright once again assured the EDC that the requ'red data will be captured once the S oftware i s i nstalled a nd the n ecessary d ata i s d own 1 oaded. A Id. F eldman concluded his comments by stating the brochures and other collateral marketing material is excellent and the supporting funds provided by the City are small considering flow they are leveraged and the marketing efforts performed. Ald. Moran made a motion to recommend approval for funding is the amount of S60,000 for the fiscal year 2004-5 and Aid. Wynne provided a second. The measure was then passed with a unanimous vote. IV. Aid. Feldman stated that the fourth item on the agenda was also a carry over item from the June meeting concerning a request from the Evanston Community Development Corporation (ECDC) to the EDC to recommend approval to the City Council, for the funding of a TIF District study within the 2"d and S`h wards. At the request of ECDC members, staff member Robinson distributed bound copies of the Church & Dodge Revitalization Strategy 2004-2006 to the EDC members. Aid. Feldman asked Ms. Delores Holmes, ECDC Chair to begin the presentation. Ms. Holmes provided a brief summary of the ECDC program and advised the EDC that outreach efforts were made to inform the community of the TIF District proposal as well as to reach consensus with other neighborhood groups of what the boundaries of the proposed TIF District should be. Over4(i0 flyers were distributed in the target area and twenty or so residents attend a T1F District orientation meeting which was co -conducted with Ms. Betty Sue Ester. As a result of these efforts, The ECDC board agreed to retain the original proposed TIF District boundary map that was presented at the June 23, 2004 EDC Meeting. After a brief discussion by the EDC members, Committee members once again lauded the ECDC for their efforts and progress made to date in the development of a revitalization strategy for the Church/Dodge area. There being no further questions, Ald. Feldman called for a motion. DRAFT-NOT-APPRO t'FD ECONOMIC DEVELOPMENT COMMITTEE MINUTES-JULY 28. 2004 PAGE 4 Ald. Moran moved to highly recommend approval for funding a TIF District study for the Church/Dodge corridor area indicated by the proposed reap and Member Marvin Juliar provided a< second. The measure was then passed with a unanimous vote. V. City staff member Dennis Marino provided the EDC members with a brief update on the first phase of the Tom Roszak residential development project to be constructed at Ridge and Clark. Mr. Marino continued with an update on the BankOne plaza and revitalization and redevelopment project at Dais and Orrington and west on Orrington. Mr. Marino concluded his remarks with an update on the Main Street Commons redevelopment Project and the continued growth of CE Niehoff'& Co. Niehoff is the Evanston based manufacturing company that recently acquired the closed Riley and Gheer plant located just to the west of the NiehofTproperties. The buildings will be connected in the future. Aid. Feldman voiced his approval and commented on the Foods For Less grocery store which is scheduled to open in the Main Street Commons shopping center. Aid. Feldman urged all who haven't done so, to visit one located in the Chicago area when possible. Ald. Rainey advised the EDC of a neighborhood meeting at the Levey Center on Thursday July 29, 2004 at 7:00 P.M. concerning a proposed town house development project on a portion of the old Shure Brothers property. Thus far the proposal has been well received in the immediate community. All are invited to attend the meeting. VI. The communication items included in the EDC packets were acknowledged. VIL There being no further business, the meeting was adjourned at approximately 9:10 P.M. The next scheduled EDC meeting is for Wednesdav August 25.2004 at 8:00 P.M. in Room 2404. Civic Center. Economic Development Planner ECO`'OMIC DEVELOPMENT COMMITTEE MEMBERS PRESENT: MEMBERS ABSENT: PRESIDING OFFICIAL: OTHER COUNCIL MEMBERS PRESENT: STAFF PRESENT: OTHERS PRESENT: Summary of Actions: MEETING MINUTES OF WEDNESDAY September 22, 2004 ROOM 2404-8:00 P.M. CIVIC CENTER Aid. Feldman, Aid. Moran, Ald. Newman, Aid. Rainey, Marvin Juliar, Martin Norkett, Barbara Putta, Alice Rebechini Aid. Wynne Aid. Feldman, Chair Aid. Jean -Baptiste Judith Aiello, Dennis Marino, Morris Robinson, William Stafford, James Wolinski Carl Bufalini, Delores Holmes, Ronald Kysiak & other ECDC Members, Robert Rychlicki, Jeffrey Taggart I. Aid. Feldman called the EDC Meeting to order at 8:01 P.M. II. The July 22, 2004 minutes were unanimously approved by the Committee. III. Although the discussion concerning the Feasibility/Eligibility Study for the West Evanston proposed TIF District was scheduled as agenda item # IV, Ald. Jean -Baptiste asked the Chair to consider the item first because of another meeting time conflict. Chairman Feldman honored the request. Aid. Feldman stated that he had the discussion of the proposed TIF District added to the agenda because of issues and questions which arose from the debate over the proposal at the last Council Meeting. Also, Aid. Feldman recognized the need for the EDC to provide additional attention to the TIF District proposal even as the feasibility study proceeds. Ald. Newman began the discussion by stating the proposed TIF District appeared to cover a large area and perhaps the people who suggested the boundaries did not understand the serious implications the proposed boundaries would create. Aid. Newman stressed that although it will be very difficult to accomplish, there is a need to develop more information which will help to successfully create the new TIF District. One action that should be done, if it hasn't yet occurred is to borrow an idea used to further the development efforts made on Howard Street. 'I, DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES-SEPTENIBER 22, 2004 PAGE 2 Aid. Newman stated that members in the development community should be invited to the West Evanston area, as they were for the Howard Street initiative, to provide input as to what development projects might be possible. Aid. Newman made note of the Dempster and Dodge redevelopment efforts (Evanston Plaza) and the large quantity of retail space that was created of which a sizable portion remains empty. Additionally, the proposed TIF District Southern boundary includes existing, functioning businesses. Some of the businesses could cost upwards ofone million dollars to relocate. In addit5ion, Aid. Newman stated that there is probably little that can be done with regard to zoning constraints. Aid. Newman voiced his opinion that City staff should be participating in reviewing the many issues and concerns, particularly by investigating what other communities have done with creating TIF Districts which did not initially have an economic engine. Aid. Newman also suggested that some of the stated goals of the ECDC group are actually "social engineering" attempts, which is contrary to creating a TIF District designed to provide incentives. While on the other hand another ECDC development goal is to create jobs programs, affordable housing and other similar results. Aid. Newman stated the goals appear to become a wish list rather than reality and this concem needs to be presented to the development community. Aid. Newman said that another goal is to create an incubator and reminded the EDC of the heavily subsidized incubator experience the City and Northwestern University had with the Research Center incubator. It would be difficult to imagine the creation of another incubator but if that is a goal then market testing should be a requirement. Aid. Newman summarized his desire to invite a broad selection of developers provide input and have City staff become more involved and accumulate more information in addition to the information obtained from the Kane/McKenna study. Part ofthe information to be gathered should be an analysis of Tff Districts that have failed to see what can be learned from the mistakes made by those unsuccessful attempts. Dennis Marino commented that staff has been speaking with developers in the area but the effort could be expanded at which time Aid. Newman concurred with the expanded effort. EDC Member Barbara Putta stated she recalled from a previous EDC Meeting, that because the proposed TIF District new development projects would be primarily residential, resulting in more children, there was concern as to whether or not the school districts would waive the student reimbursement requirement. Aid. Jean -Baptiste advised the EDC that both school superintendents have been involved in the discussions and both have expressed support for the proposal, particularly District 202. However, the school boards have not made a determination and no details are available at this time. When the feasibility study is completed, discussions with the school districts can proceed based on specific knowledge as to how the proposed TIF District will impact on the level of real estate tax revenue that accrues to the school districts. Aid. Feldman underscored that point. DRAFT-NUT-APPRO R ED ECONOMIC DEVELOPMENT COMMITTEE MINUTES-SEPTEMBER 22, 2004 PAGE 3 Aid. Feldman also recalled that he had heard that District 202 was partial to efforts directed at creating affordable housing and would be interested in subsidizing the purchase of affordable housing for District 202 teachers and employees. Aid. Jean -Baptiste stated that Superintendent Allan Alson expressed optimism with the ECDC initiatives since a number of District 202 teachers do not reside in Evanston simply because of the expensive housing market. Although the superintendent has embraced the objectives of the ECDC development planning, details have yet to be completed. Aid. Feldman asked the City consultant, Mr. Robert Rychlicki with the firm of Kanc/Mckenna if known problematical issues or the specific location reg,:rding a proposed TIF District influence the feasibility factor of an eligibility/feasibility study. Mr. Rychlicki stated that the eligibility factor is more controllable since thirteen factors as set forth in the TIF Act are used to make the inventory determination. However there is a nexus between the TIF District and the kind of redevelopment projects that will attract financing from banks. At some point during the study analysis, those development reuses or potential revenue engines that will create the increment in the TIF district will have to be identified. Heretofore, The City policy has been to have a potential engine or generator at the time of the establishment of the TIF District. Mr. Rychlicki added that based on an informal survey of other TIF Districts, indications are those districts that had a revenue generator, start building a fund balance much earlier. Aid. Feldman said that given the hopes and aspirations of the proposed TIF District, it is possible to develop a reasonable idea as to where revenues can be generated but also what kind of revenue that could be generated. Mr. Rychlicki stated that it must be remembered that the TIF Act is primarily a "bricks and sticks" type funding mechanism designed for capital development projects. Over the years there have been add-ons to the act for such programs such as job training. Aid. Feldman next asked if a TIF District is established and within portions of the district there are existing businesses that are thriving, is it best to remove those businesses from within the TIF District boundaries or to leave them in, and if so, what affect does either action have. Mr. Rychlicki stated that if historical review indicates that these businesses valuations are trending upward at a rate greater than the rest of the district consideration should be given to removing them. What would be the point of including them in the TIF District. In fact, when the downtown Washington National TIF District Expansion Amendment was established, the decision was made to contract the initial larger boundary by half because ofthe existing thriving businesses, as well as to mollify the various taxing districts. Aid. Rainey stated that the support she expressed for the TIF District Study at the recent City Council Meeting was aimed at completing the study so that the feasibility and eligibility can be detennined and not for the ECDC proposal itself. They are two distinct issues. Aid. Rainey added that if her suspicions are correct, the reap produced from the study will not be significantly changed from the proposed map presented by the ECDC. DRAFTWOT--APPROVED ECONOMIC DEVELOPNIENT COMMITTEE MINUTES-SEPTEMBER 22, 2004 PAGE 4 Aid. Rainey stated that her opinion of the proposed map is that it covers much too much ground. Both AId. Feldman and AId. Rainey expressed their opinion that the proposed redevelopment plan could be perceived as too ambitious and Aid. Feldman repeated an earlier caution to the ECDC to be careful with reaching a point that the plans are so ambitious that they become unachievable. Mr. Jeffrey Taggart, CFO, School District 202 was asked ifhe had any comments. Mr. Taggart stated that the foregoing was accurate and that Dr. Alson has expressed his support for the ECDC plan. Aid. Newman asked Mr. Taggart if he could comment on the notion of the high school administration's encouragement of employees to live in local housing. Mr. Taggart advised the EDC that there is a reduced rate loan program administered through the Evanston Bank & Trust which is available to employees and this is the extent of the high school involvement. Aid. Newman asked how many District 202 employees have taken advantage of the program. Mr. Taggart said that he didn't have current data but promised to provide the information later. Aid. Newman said he would very much like to have the data to help with his evaluation of the ECDC plan. Ms. Delores Holmes advised the EDC that the Evanston Bank & Trust has made the decision to partner with the ECDC and a representative of the bank has been elected the ECDC board of directors. In addition the bank has established a S50,000 micro -loan program for small businesses. As far as the proposed plan for affordable housing at Church and Darrow, it will be administered as a rent to own program ad it is expected that employees of both school districts will participate. Aid. Rainey asked if the construction of the residential project at Church and Darrow is contingent on the establishment of a TIF District. Ms. Holmes response was that the project will go forward with or without the establishment of a TIF District. Aid. Rainey asked how many units are planed for the project. Ms. Holmes said the plan is for 20 to 40 units, dependant on the success of the land acquisition. Mr. Ron Kysiak also advised the EDC that there are two underground fuel tanks on the comer property and the cost for removal and remediation if necessary will ultimately impact on final unit cost. The establishment of a TIF District would greatly assist in creating a "developable" site. Additionally, there is a ComEd substation at the corner of Church and Brown and although ComEd is agreeable in relocating the sub -station as long as they don't have to pay for the move. It will cost $700,000 to effect relocation. Again the establishment of a TIF District would be beneficial in creating a developable site at Church and Dodge. Aid. Newman asked who would provide the funding for these initiatives since establishing TIF District boundaries does not in itself crate revenue increments. Unlike all of the other TIF Districts which initially had large parcels and projects that created significant cash flows, this proposed TIF District does not. All funding sources, including the high school and the City need to be identified. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES-SEPTENIBER 22, 2004 PAGE 5 Mr. KYSiak said that staff assistance is welcome and that the study should First be completed and concurrently the out reach process would proceed. Many small economic engines are envisioned. After additional comments by Mr. Kysiak, Aid. Newman stated that aside from the KaneIMCKenna analysis, City staff needed to be involved on a regular basis in researching and obtaining information useful for determining possibilities for the plan. Dennis Marino concurred and offered the opportunity to continue working with ECDC to help make the plan successful. Aid, Feldman urged Mr. Taggart to convey the need for partnership to Dr. Alson on the need to assist in the success of the development effort. Aid. Jean -Baptiste concluded the remarks by thanking the EDC for being engaged in the process to find a way to move the process forward. There being no further discussion, Ald. Feldman proceeded with the next agenda item. IV. Aid. Feldman stated that the next item on the agenda was an update on the Downtown Visioning Process. The EDC members were provided with documents conceming the visioning process in their packets. Interim City Manager Judith Aiello advised the EDC that the documents before them are the initial attempt to consolidate all of the information presented for the downtown visioning process. it is recommended by staff that at this point the draft documents simply be accepted with no action because the intent is to distribute the documents to Evmark, Plan Commission and the Parking Committee and all of the other stake holders. Once the Retail Analysis Report is completed, (which has only just started) as well as the parking and traffic analysis, the intent is to have a special meeting inclusive of all these groups. The primary purpose of the meeting will be to deliver a full presentation so that all stake holders are advised of the findings at the same time and the participants can then decide the groper division of the issues to be resolved and assign the tasks to the appropriate groups. Aid. Feldman asked Ms. Aiello to confirm whether or not the draft document was unedited. Ms. Aiello stated that staff decided that it was not within its purview to either agree or disagree with the issues presented. At some point in time, staff will want to address some of the issues that are raised. Member Martin Norkett stated that the key to success was determining a way to control of the property owners or have overall authority similar to what you would have in a shopping center. Mr. Norkett also stated that some form of incentives should be offered to merchants to keep their establishments open later. Other members of the EDC commented on the incentives already provided and are there for the innovative merchants to pursue. Ms. Aiello stated attempts have been made to demonstrate to the property owners, the synergies that can be created participating in the visioning program. It is hoped that the combined efforts of the City and Evmark, to interact with the various developers and stake holders will begin that process of cooperation. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES-SEPTENIBER 22, 2004 PAGE B For instance, unlike a shopping center, Evmark and the City can't dictate to independent merchants as to how long they should remain open each day, but gradually they are finding it to be to their benefit to adjust their late hours to take advantage of the opportunities that have been generated from the downtown major developments and increased marketing. When the Sherman Plaza development project is completed additional potential benefits will be generated. Aid. Newman reminded the EDC of all of the new, moderately priced parking facilities which will primarily benefit downtown merchants. After a brief discussion concerning preferences for certain types of stores in the downtown and the various uses for the completed visioning plan and analysis reports, the EDC agreed that the work done to date is excellent. Member Alice Rebechini suggested that it is important not to loose the momentum and the process should not be sidetracked by other issues. It is important that the convening of the all group meeting should proceed as soon as possible and the EDC will be anxiously awaiting the results. Aid. Rainey asked for and received information as to where the unused viaducts mentioned in the draft are located and what can be done with the unused, visually unattractive viaducts. V. Chair Feldman proceeded to the next agenda item which was an update on the Sherman Plaza Redevelopment Project. Ms. Aiello stated that at the next City Council Meeting, the Fourth Amendment to the Redevelopment Agreement will be considered and she advised the EDC of the continuing demolition of the old Sherman Avenue public garage. It is anticipated that some construction will commence before the end of the year. The complete plans for the new garage should be arriving for review in the next few weeks and the opening of the loan is immanent. Retail leases are in good order and condo sales are approximately at the 60% level. Ms. Ann Diener, an audience member, asked for six bricks from the demolished garage. Ms. Aiello promised to honor the request. VI. The next agenda item was a presentation regarding Enterpriz Community Development and a New Markets Tax Credits participation opportunity. Mr. Marino informed the EDC that the New Markets Tax Credits program was designed by the Federal government as a means to stimulate economic development in urban and rural areas of the country where private sector real estate and business investments have been lacking. The program is structured as a 39% tax credit over seven years to qualifying investments. Most of the Evanston census tracts meet eligibility requirements. The program is administered by the US Department of Treasury and participants have to undergo a competitive process to obtain funding allocations. A Request For Proposals (RFP) was recently issued and a participation u7ndow of opportunity has been presented. Enterpriz Cook County has inviter] the City of Evanston as well as other municipalities, the opportunity to be part of a — consortium that will apply for the tax credits. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE NIINUTES-SEPTENIBER 22, 2004 PAGE 7 The article included in the packet provides information on hoe these tax credits have been used in tandem with other economic development incentives. This is a program that if the City alone attempted to apply directly for, it is doubtful if an allocation would be granted, mainly because the Treasury Department is interested in moving the funding through much larger institutions. Mr. Carl Bufalini, District Manager -Business Development for Enterpriz, was present in the audience and Mr. Marino introduced him to the EDC. Aid. Rainey asked why residential rental projects are ineligible for the tax credit program. Mr. Marino stated that his best guess was because the Department of the Treasury already has low income housing tax credits and this program is viewed as the economic development equivalent to that particular program. Mr. Bufalini added that the program was enacted by congress as part ofthe Community Renewal Tax Relief Act and will make S 15 billion available over the next seven years to encourage developers to generate projects in low income census tracts, areas when they generally had little interest to do so. Allocations from the program are specified for low income communities. The reason the funds are not specified For rental housing is because the people who are the recipient of the revenue are not the low income people. The allocations are for manufacturing, commercial and residential ownership. As an example, for the proposed TIF District in West Evanston, these allocations can provide gap funding, perhaps 2 or 3% below the market rate which in turn could be a deal closer for a potential developer. The City would not have any obligation for the funds since Enterpriz is the entity applying for the allocation. There is no guarantee the application will be successful, but if the funds are granted, the City would be able to use some of the funds for existing projects or for new projects. Dennis Marino underscored the fact that staff would use the program as another non -cost tool in the economic development tool kit and that staff will collaborate with Enterpriz and move forward with the proposal. Aid. Feldman asked how the funds would be allocated. Mr. Bufalini stated that Enterpriz will apply for the program on October 6, 2004. If successful, the allocation will be made in the spring of 2005, (April thru June or July) and once the allocation is made the funds are available. At this point the municipality will seek investors and when investors are on board the search for projects begins. Also the applicants will not know the amount which will be granted. Enterpriz will ask for $100 million but may possibly only receive $38 million. There is a commitment by the Treasury Department to make S2 billion available for the whole country, this year. Aid. Rainey asked the identity of the other municipal partners. Mr. Bufalini said Berwyn, Hazlcrest and other mostly south and south-west municipalities were participating. Ironically the Glen in Glenview was included in the eligible census tract, perhaps because at the time of the last census it had not been developed, however Glenview will not be part of the group. DRAFT-NOT-APPROI ED ECONOMIC DEVELOPMENT COMMITTEE MINUTES-SEPTEMBER 22, 2004 PAGE 8 Aid. Feldman asked when it will be known if the application is successful and the amount of the allocation. Mr. Bufalini's response was in the spring of2005. Ald. Feldman thanked Mr. Bufalini for the presentation and proceeded to the next agenda item. VIL Mr. Dennis Marino provided updates on other projects, particularly with the progress on the Main Street Market Shopping Center where the new Food 4 Less recently held its grand opening. Mr. Marino also provided the EDC with a recap of jobs created and retained in the renovated center as well as jobs created at the renovation in progress of the Orrington hotel. The employment information is available in the Planning Division. V11I. The communication items included in the EDC packets were acknowledged. IX. There being no further business, the meeting was adjourned at approximately 9.30 P.M. The next scheduled EDC meeting is for Wednesdav October 27. 2004 at 8:00 P.M. in Room 2404, Civic Center. submitted, 0 Vlorrh E. Robinson Economic Development Plarmer ECONOMIC DEVELOPMENT COMMITTEE MEETING MINUTES OF WEDNESDAY NOVEMBER 17, 2004 ROOM 2404-8:00 P.M. CIVIC CENTER MEMBERS PRESENT: Aid. Feldman, Aid. Newman, Aid. Rainey, Aid. Wynne, Barbara Putta, Alice Rebechini MEMBERS ABSENT: Aid. Moran, Marvin Juliar, Marty Norkett PRESIDING OFFICIAL: Aid. Feldman, Chair OTHER COUNCIL MEMBERS PRESENT: None STAFF PRESENT: Judith Aiello, James Wolinski, Dennis Marino, Moms Robinson OTHERS PRESENT: John Leineweber, Mary McAuley- Principals -Renaissance Realm c& Construction Surn nxry of Actions: L Aid. Feldman called the EDC Meeting, to order at 8A3 P.M. Il. The September 22, 2004 EDC Meeting minutes were unanimously approved by the Committee, although not in agenda order. III. Aid. Feldman stated that the planned agenda order would not be followed, and asked the EDC members to first consider agenda item # N which concerned the establishment of a date for the annual Meetings of the Joint Review Boards which serve the five TIF Districts in the City. The EDC unanimously approved the date of Wednesday, December 8, 2004 as the date for the meetings. The consecutive meetings will be held at the Civic Center in Room 2404 and they will convene at 9:A.M. IV. Although listed as #V on the agenda, Aid. Feldman next introduced for consideration a Storefront Improvement Program Participation Reauest for financial assistance in the amount of S20,000, from Renaissance Realty & Construction, Inc, The purpose for the financial assistance is to complete external storefront improvements to be made on the old Fanny's Restaurant property which is undergoing extensive rehabilitation. The property, renamed Fanny's Loft Building, is located at 1601 Simpson, and Mr. John Leineweber and Ms. MaryMcAuley are the principals of this local development firm performing the rehab project. The development principals were in attendance to present an overview of the project and to illustrate the reasons for the financial assistance request as well as to answer questions. DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES-NOVEINIBER 17, 2004 PAGE 2 Mr. Leineweber explained to the EDC that he was in the final stages of rehabilitating the old Fannie's restaurant, which when finished will consist of three Simpson Street ground level retail spaces; a two story space on Ashland Avenue; and two loft offices on the second floor. One minority restaurant entrepreneur is already committed to the western most ground level space on Simpson. Ms. McAuley also advised the EDC of other potential tenants. Mr. Leineweber's finn has successfully converted distressed buildings located in areas designated by the City as needful of economic development opportunities, into innovative adaptive reuse live/work spaces. These projects have enhanced the communities and improved tax revenues forthe City. The Fannie's restaurant project is a prime example of his efforts. Mr. Leineweber and his partner Ms. McAuIey provided the EDC with a detailed update of the completely gutted renovation project to date. There remains approximately S100,000 worth of facade improvements for storefront windows and decorative iron work. Mr. Leineweber stated that he would provide S80,000 and explained how the requested S20,000 would be used to complete the awnings, balconies and iron work at S5,000 per store. Dennis Marino Also advised the EDC that the funds would only be disbursed after proof of payment for work completion has been presented to the City. The city funds would be a 50% match for the storefront facade improvements, not to exceed S5,000 for each of the four spaces. Unfortunately, the visual aids that Mr. Leineweber used to illustrate the project were outdated and the EDC members found it difficult to process all of the changes which have occurred on the project, and found it equally as difficult in their attempts to envision the planned facade improvements. Aid. Newman also expressed concern as to whether or not the community has been provided with sufficient opportunities to be made aware of the project. After considerable discussions about the architectural elements, the EDC continued to find it difficult to envision the project with the obsolete renderings. Aid. Feldman subsequently asked for a motion from the EDC members. Aid. Newman suggested 1.) that the developers return to the EDC with updated design renderings depicting exactly how the facade elevations will appear once completed and 2.) distribute flyers in the immediate area and conduct at least one more neighborhood meeting to present the project to the community. The developers expressed their willingness to follow both suggestions. After a brief discussion, the developers were advised to follow the instructions and return to the December 8, 2004 EDC .Meeting for action. Aid. Newman presented his suggestions in the form of a motion. Aid. Wynne provided a second to the motion and the measure passed unanimously. V. Other project updates were provided by Dennis Marino. The EDC was briefed on the success to date of the new Food 4 Less grocery store located in the renovated Main Street Market Place shopping center. A Starbucks Coffee shop is also slated to open in the center. DRAFT -NOT -APPROVED ECOtiOMIC DEVELOPMENT COWMITTEE MItiUTES-HOVENfBER 17. 2004 PAGE 3 A briefing was also provided for the Roszak residential project on Ridge Avenue and Clark Street. Ald. Rainey stated that the financing needed for the project was easily obtained. Dennis Marino also advised the EDC that Principals of Freed & Associates will be at the January 2005 EDC Meeting to respond to questions concerning the Evanston Plaza (Dempster/Dodge) Shopping Center. VI. At approximateiv 8:40 P.M.. Morris Robinson conducted a roll call vote for the EDC to enter into Executive Session and received a unanimous vote to do so. At anproximately 9:10 P.M. the EDC concluded the Executive Session and returned to the open public meetinL. VIII. The communication items that were included in the packet were briefly acknowledged by the EDC members. IX. There being no further business, the meeting was adjourned at approximately 9:15 P.M. The next scheduled EDC meeting is for Wednesday. December 8.2004 at 8:00 P.M. in Room 2404. Civic Center. Respectfully submitted, Morris E. Robinson Economic Development Planner DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES-NOVEMBER 17.2001 PAGE 4 CONFIDENTIAL The Economic Development Committee Entered in to Executive Session at Annroxlmateh 8:40 P.M. for the Purpose of Discussing Prourietary financial Information. Dennis Marino advised the EDC that Mr. Richard Fisher, owner of the Volkswagen dealership on Chicago Avenue recently purchased a parcel of land in Skokie, located on Oakton Street just west of McCormick Boulevard. Approximately two months ago staff began hearing messages that Mr. Fisher intended to relocate one or both of his dealerships out of Evanston. Staff became concerned about this prospect and contacted Mr. Fisher by letter, indicating the City's desire for him to remain in Evanston. Mr. Fisher responded in writing, stating that he too would prefer staying in the City and asked for a meeting. Staff has since met with Mr. Fisher on more than one occasion. Mr. Fisher is interested in purchasing the vacant J & F Steel property (formerly Belmont Steel) located at 2424 Oakton Street. The property has been vacant for about two years and is owned by Mr. Lee Fry who is a land developer and speculator. Thus far, the only inquiries for the property presented to the city have been for residential development projects. Mr. Fisher would like to purchase the property from Mr. Fry and sell or swap the parcel of land he purchased in Skokie. If these efforts prove to be successful, Mr. Fisher would then proceed to relocate all of his dealership and auto services on the steel company site. In order for this scenario to work, Mr. Fisher would require financial assistance byway of a sales tax reimbursement program with the City, to include rebating some portion of sales tax revenue currently being generated. Currently, the dealerships are generating sales tax revenues approximating S300,000 per year. If Mr. Fisher's enterprises move to Skokie, The City of Evanston would loose this entire revenue stream. Staff has had three discussions with Mr. Fisher and has determined that he does not have control of the property but he has entered into direct discussions with Mr. Fry. There is a mutual agreement between Mr. Fisher and staffthat the price is higher than it should be and that it is important to lower the asking amount. The reason staff is advising the EDC of this matter is because of reluctance on the part of staff for events to proceed without the entire EDC being aware of the described prospects and associated issues, as well as to get the EDC input. Ald. Feldman asked Mr. Marino to explain Mr. Fisher's potential for increased business and sales tax projections if the plan proves to be successful. Mr. Marino stated that Mr. Fisher would anticipate an increase in sales by 50% over time, if the dealerships were consolidated on the steel site. The site is large enough to accommodate his two existing dealership and there is room enough to add a third. If the business is currently generating S300,000 annually, then it is conceivable, under this new DJU FT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE `H'-% TES-NOVE.NIBER 17. 2004 PAGE 5 scenario that that sales tax revenue amount could grow to S450,000 per year. Ald. Feldman asked Mr. Marino what the gross annual sales figure was far. Mr. Fisher's enterprises. Mr. Marino stated that Mr. Fisher currently grosses in the range of S50 million per year, but that amount has to be discounted by the trade in values of cars, which makes the amount closerto S38 or S39 million. Mr. Fisher will be providing additional data Ald. Wynne asked if staff had done an independent evaluation of the projections. Mr. Marino said no evaluation of the projections had occurred but a verification of sales tax data was confirmed by the Finance department. An independent evaluation of Mr. Fisher's projections as well as a business pro - forma will certainly occur if the EDC agrees to have staff proceed with the concept. Ald. Newman asked for a clarification of the need for financial assistance. Mr. Marino stated the cost of the land is the primary issue. Ald. Newman stated that it should be made known to Mr. Fry that the City has no intention of re -zoning the site for residential which sparked a general discussion regarding Mr. Fry's intentions associated with zoning prospects and the potential benefits of retaining the car dealerships in Evanston. Although Mr. Fisher is eager to proceed, Mr. James Wolinski, Director of the Community Development Department stated that he left recent conversations with Mr. Fisher with the impression that Mr. Fisher believes the prospective deal with the City is loosing momentum. Also, Mr. Dubin, a residential developer is attempting to acquire the property and has allegedly offered S 1 million more than the asking price. Mr. Wolinski reiterated the point that Mr. Fry should be informed in no uncertain terms that the site will not be re -zoned for residential. Ald. Rainey stated that Mr. Dubin has been made aware that the site will not be rezoned and the EDC members concurred with those sentiments. Mr. Marino indicated that it has been made clear to Mr. Fry on more than one occasion also that the City prefers commercial over residential for the site. Continued discussion centered on how to properly convey to Mr. Fry, the City's desire to keep the steel site zoned for commercial, as well as the best way to proceed with the prospect of a financial assistance program with Mr. Fisher. The EDC instructed staff to proceed with the sales tax rebate feasibility effort and to make it clear to both Messrs. Fry and Durbin that the City has no interest in re -zoning the site to allow residential. Mr. Marino next provided the EDC with an update on the Evanston Plaza Shopping center. For the second year in a row, Freed &: Associates will receive a sales tax reimbursement for approximately S44,000. Sales tax revenue generated for the fiscal year August 2003 through July 2004 amounted to S391,000. Of that amount, the City kept S138, 000 as the base year match; the City also kept an additional amount of S 175,000 which was previously generated from the former Chicago Avenue Dominick's store; the mitigating fund rcceived S20,000 and the remainder was split 75% to Freed and 25% to the City. A brief discussion ensued regarding other stores in the shopping center concluding with the EDC voting unanimously to return to regular open session. ME DRAFT -NOT -APPROVED ECONOMIC DEVELOPMENT COMMITTEE MINUTES-NOVEMBER 17.2004 The EDC Returned to Regular Open Session at ADDrozimately 9:10 P.M. PAGE 6 DRAFT-,VOT APPROVED MEETING OF THE JOINT REVIEW BOARDS MEETING MINUTES THURSDAY, DECEMBER S, 2004 ROOM 2404-9:00 A.M. CIVIC CENTER MEMBERS PRESENT: Aid. Gene Feldman -Chair, Allan Alson-Superintendant, District 202. Robert Berry-Sunerintendent. Mosauito Abatement District, Barbara Carlson -Public Member, Mary Erickson -District 65, Jackie Harder -Cook County Board, Valerie Kretchmer-Public Member, Martin Norkett-Public Member, Brian Rosinski-Ridgeville Park District, Jeffery Taggart -District 202, Patricia Vance - Evanston Township, Edward White -District 65 PRESIDING OFFICIAL: Aid. Gene Feldman STAFF PRESENT: Judith Aiello Assistant Cite, manazer, Dennis Marino - Assistant Director. Communitv Development Department, Morris Robinson -Economic Development Planner, Wifliam Stafford -Director, Finance, Remy Navarrette- TIFAnaltst OTHERS PRESENT: Mayor Lorraine Morton Summary of Actions: I. Aid. Feldman convened the JRB meeting at 9:05 A.M. and asked each JRB and City staff member to introduce himlher self. Il. Aid. Gene Feldman and City staff member Dennis Marino jointly advised the JRB members that the purpose for the annual meetings is to comply with the State of Illinois TIF statutes. The statutes require all TIF District Hoards to convene annually to review each TIF District's performance and to insure compliance with state regulations. Evanston currently has five TIF Districts: 1.) The Research Park TIF District; 2.) The Washington National TIF District As Amended; 3.) The Howard/Hartrey TIF District; 4.) The Southwest TIF District and 5.) The Howard Street TIF District established in 2004. DRAFT -NOT APPROVED MEETING OF THE JOINT REVIEW BOARDS MINUTES-DECE'MBER 8, 200J PAGE 2 Mr. Marino stated that all five JRB meetings will be combined in this one session and each TIF District will be independently discussed in detail, in the order listed on the agenda. Each member of the Joint Review Boards received by messenger, an agenda and financial performance audit reports for each TIF District prior to the date of the JRB meetings. Copies of the audit reports are available for review at the Civic Center Planning Division, third floor. 1I1. The Howard/Hartrev TIF District # 3 was scheduled for the first review. Mr. Marino informed the JRB that the location of the TIF was previously the old Bell & Howell Warehouse site. Using an aerial map of the site, Mr. Marino described the boundaries of this district. The Howard/Hartrcy Shopping Center is located in this TIF District. The tenants of this shopping center are Jewel/Osco, Best Buy, Office Depot, Target and a World Bank branch. Two undeveloped out -lots are available. Each store owns its footprint pad but Target has overall housekeeping responsibility. Each store also has a veto right with regards to attracting potential out -lot developments. Sales tax revenues generated from the stores at the Howard/Hartrey Shopping Center represent approximately 25% of the City's total sales tax revenue stream. Mr. Stafford referenced the audit reports, which were distributed by messenger to each board member. Mr. Stafford then provided a summation of the financial performance of the Howard/Hartrey TIF District. Mr. Stafford directed the attention of the JRB members to page 18 which details tax revenues and p age 2 5 w hich d etails fund b alance and f uture o bligations regarding the Howard/Hartrey audit report. The shopping center generated S1.2 million in property tax and the center provides an excellent revenue stream. The fund balance is approximately $7.7 million in bond debt remaining on this table TIF District. The Howard /Hartrey TIF District is due to expire in 2017. IV. The Southwest TIF District # 2 was reviewed next. Mr. Marino advised the JRB that the site of this TIF District was the old Mayfair Railroad right of way, a location that required environmental clean-up before development could proceed. The location is just south of Main Street and includes the Sam's Club building but not the entire parking lot, as well as some land behind the building. The other user of this TiF District is Wards Manufacturing which erected a new building on the site after relocating from the Research Park. Ward Manufacturing is expanding and recently acquired the nearby and bankrupt Riley & Gheer manufacturing site. Construction efforts to connect the sites are currently being completed. Mr. Marino advised the JRB that this heavy transmission manufacturer pays some of the highest wages in Evanston. DRAFT -NOT APPRO t ED MEETING OF THE JOINT REVIEW BOARDS MINUTES-DECENIBER 8. 2004 PACE 3 Mr. Stafford again highlighted the key pages of the audit (18 & 25 which are standard in each of the four audit reports) for this TIF District_ The expenditures for the Southwest TIF District are mainly for debt service and the intergovernmental agreement we have with the school districts. Approximately S1.2 million in debt is outstanding, but should be paid off in a few years. This TIF District mill expire in 2015. V. Downtown II/Research Park TIF Dktrict # I was the third district reviewed. Following the same pattern used with the two previous reviews, and with the use of visual aids including an aerial photograph, Mr. Marino provided a overview of the boundaries of the Downtown TIF District as well as the historical background. Ms. Judith Aiello, Interim city manager, briefly explained the development components and activities for the Down TIF district, information that has been provided in extended detail in all of the past JRB Meetings and are on record in the minutes of those previous years' proceedings. The 800 Elgin mixed use residential project, next to the 1800 Sherman Avenue office building is near completion and will contribute to the future performance of this TIF district. However, Ms. Aiello also informed the JRB members of Northwestern University's recent purchase of the 1800 Sherman Avenue office building. With the building removed from the property tax roles, the action will have a major impact on the Downtown II TIF District financial performance for next year. Ms. Aiello also advised the JRB members that certain funds %,.ill be used to erect an art sculpture in the TIF District. Mr. Stafford again referred to pages 18 and 25 of the audit report for the Downtown 11 TIF District, while explaining that $7.2 million in property taxes were generated for the year. This amount does not include the new 800 Elgin mixed use residential building. Currently there is S38 million, including principle and interest, outstanding in this healthy, for this TIF District. Member Martin Norkett asked if the "art' funds could be diverted to the school districts. Ms. Aiello stated that several years ago the City Council approved a measure to set aside 1.0 % of project cost for public art. It would require City Council action to divert these funds to the school. Member Valerie Kretchmer asked about the cinema revenue stream. Mr. Stafford advised the members that since opening, the cinemas have had from 1 to 1.3 million visitors a year. A brief discussion ensued about hotel taxes and increased parking rate revenues. Member Patricia Vance noted that on page 20 of the audit report an entry indicates that $800 thousand was transferred to the Washington National TIF District and asked for an explanation. Mr. Stafford said the required transfer of funds represented half of the base transactions associated with the original specifications for the Sherman Plaza Development Project. DRAFT-XO r APPRO { ED MEETING OF THE JOINT REVIEW BOARDS SUNUTES-DECEIIBER S. 2004 PAGE 4 V1. The Washington National TIF District As Amended # 4 was next on the agenda. Mr. Marino again provided the JRB members with a brief history of the site. This TIF District is anchored by the John Buck mixed use residential tower and the Whole Foods grocery store located in the street level commercial portion of the building. Mr. Marino stated that the building averages a 95% occupancy rate. Ms. Aiello informed the JRB members that the principals of the Sherman Plaza Development project, (located in the amended portion of the district) have successfully closed with their lender on the financial agreements. his. Aiello shared artist renderings of the project. Tenants will include a soft goods merchant and Pier one. The negotiations for the health club are still underway. Osco has made the business decision not to return to the new development. In total there is 156,000 square feet of retail space, 253 condominium units and the base EAV is expected to significantly increase. Although there remains approximately 80,000 square feet of retail space for lease, overall the developers are pleased with sales to this point. Mr. Stafford said the project will generate $1 million for each of the first two years and that the debt has been arbitraged at S20-30 million dollars for the project. Member Mary Erickson, advocating for the school districts stated that ongoing revenue streams benefiting the schools is what is needed and asked if there were additional funds that can be directed to the schools. Mr. Stafford advised the members that revenues are routinely scrutinized to determine if more f unds c an b e p rovided t o t he s chools, m erttioning t he m ost recent i ncrease from S400,000 to 5600,000. Mr. Stafford emphasized the need to be careful with the integrity of the TIF Districts. VII. Howard Street TIF District 11 5 was the last district on the agenda slated for review. Because this is a recently established TIF District, there wasn't a financial audit for this year. Mr. Marino did provide a brief history of the area, its boundaries and its current status. Bristol Chicago Development, LLC is currently negotiating with lenders to provide financing for a sixteen story, 220 rental unit building to anchor the TIF District. After completing the brief update, Mr. Marino announced the end of the official reports. At this point, Mr. Marino advised/updated the JRB members on the West Evanston TIF District feasibility study being conducted by the Kane McKenna firm. The study is expected to be completed in January or February, 2005. Both school district 65 and 202 are aware of the proceedings and have had input with the community organization concerning the proposal for a West Evanston TIF District. The Honorable Lorraine Morton, Mayor of the City of Evanston, expressed her gratitude and respect for the work associated with the TIF Districts that staff provides. DRAFT=,VOT APPROVED MEETING OF THE JOINT REVIEW BOARDS MINMTS-DECENIBER S. 2004 PAGE 5 A JRB member asked if school projections on student populations were available. Dr. Alson stated that District 202 has a current student enrollment of 3,200 and will probably decrease to 3,100 by the end of the decade. A District 65 member stated that the enrollment will be flat for the foreseeable future. After additional general conversations came to an end, Aid. Feldman declared the Meetings adjourned. VIII. There was other business or questions from the assemblage. IX. There being no further business, the meetings of the Joint review Board officially adjourned at approximately 10: 15 A.M. Respectfully submitted, t Planner