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02-10-2016 Community Redevelopment Authority Regular Meeting Packet Community Redevelopment Authority (CRA) Wednesday, February 10, 2016 Regular Meeting Packet Board Members: Tom Gdowski Glen Murray Sue Pirnie Glenn Wilson 4:00 PM Grand Island Regular Meeting - 2/10/2016 Page 1 / 60 Call to Order Roll Call A - SUBMITTAL OF REQUESTS FOR FUTURE ITEMS Individuals who have appropriate items for City Council consideration should complete the Request for Future Agenda Items form located at the Information Booth. If the issue can be handled administratively without Council action, notification will be provided. If the item is scheduled for a meeting or study session, notification of the date will be given. B - RESERVE TIME TO SPEAK ON AGENDA ITEMS This is an opportunity for individuals wishing to provide input on any of tonight's agenda items to reserve time to speak. Please come forward, state your name and address, and the Agenda topic on which you will be speaking. DIRECTOR COMMUNICATION This is an opportunity for the Director to comment on current events, activities, and issues of interest to the commission. Grand Island Regular Meeting - 2/10/2016 Page 2 / 60 Community Redevelopment Authority (CRA) Wednesday, February 10, 2016 Regular Meeting Item A1 Agenda Staff Contact: Chad Nabity Grand Island Regular Meeting - 2/10/2016 Page 3 / 60 AGENDA Wednesday, February 10, 2016 4:00 p.m. Grand Island City Hall Open Meetings Notifications 1.Call to Order.Barry Sandstrom This is a public meeting subject to the open meetings laws of the State of Nebraska. The requirements for an open meeting are posted on the wall in this room and anyone that wants to find out what those are is welcome to read through them. The CRA may vote to go into Closed Session on any Agenda Item as allowed by State Law. 2.Approval of Minutes of January 13, 2015 Meeting. 3.Approval of Financial Reports. 4.Approval of Bills. 5.Review of Committed Projects and CRA Properties. 6.Consideration of a Resolution to forward a Redevelopment Plan Amendment to the Hall County Regional Planning Commission for Pump & Pantry Inc., 106 S Webb Rd., Grand Island, NE. 7.Consideration of a Resolution of intent to enter into a Site Specific Redevelopment Contract & Approval of related actions 30 day notice to City Council for Pump & Pantry Inc., 106 S Webb Rd., Grand Island, NE. 8.Consideration of Fire and Life Safety Grant application for 110 E 3rd St., Grand Island, NE. 9.Consideration of a Resolution to forward a Redevelopment Plan Amendment to the Hall County Regional Planning Commission for Wing Properties, 110 E 3rd St., Grand Island, NE. 10.Consideration of a Resolution of intent to enter into a Site Specific Redevelopment Contract & Approval of related actions 30 day notice to City Council for Wing Properties, 110 E 3rd St., Grand Island, NE. 11.Discussion on CRA credit card and purchase approval. Grand Island Regular Meeting - 2/10/2016 Page 4 / 60 12.Approve Resolution to Purchase/Sell Real Estate. 13.Directors Report. 14.Adjournment Next Meeting March 9, 2016 The CRA may go into closed session for any agenda item as allowed by state law. Grand Island Regular Meeting - 2/10/2016 Page 5 / 60 Community Redevelopment Authority (CRA) Wednesday, February 10, 2016 Regular Meeting Item B1 Meeting Minutes Staff Contact: Chad Nabity Grand Island Regular Meeting - 2/10/2016 Page 6 / 60 OFFICIAL PROCEEDINGS MINUTES OF COMMUNITY REDEVELOPMENT AUTHORITY MEETING OF January 13, 2016 Pursuant to due call and notice thereof, a Regular Meeting of the Community Redevelopment Authority of the City of Grand Island, Nebraska was conducted on January 13, 2016 at City Hall 100 E First Street. Notice of the meeting was given in the January 6, 2016 Grand Island Independent. 1.CALL TO ORDER. Barry Sandstrom called the meeting to order at 4:00 p.m. The following members were present: Glenn Wilson and Glen Murray. Also present were; Director, Chad Nabity; Secretary Rose Rhoads; Sr. Accountant, Billy Clingman; Finance Director, Ranae Griffiths; Accountant, Brian Schultz; Legal Counsel, Duane Burns and Terry Galloway. Sandstrom stated this was a public meeting subject to the open meeting laws of the State of Nebraska. He noted that the requirements for an open meeting were posted on the wall easily accessible to anyone who would like to read through them. 2.APPROVAL OF MINUTES. A motion for approval of Minutes for the December 9, 2016 meeting was made by Wilson and seconded by Murray. Upon roll call vote all present voted aye. Motion carried unanimously. 3. APPROVAL OF FINANCIAL REPORTS. Clingman reviewed the financial reports for the period of December 1, 2015 through December 31, 2015. Motion was made by Murray and seconded by Wilson to approve the financial reports. Upon roll call vote all present voted aye. Motion carried unanimously. 4. APPROVAL OF BILLS. The bills were reviewed. A motion was made by Wilson and seconded by Murray to approve the bills in the amount of $112,025.43. Upon roll call vote all present voted aye. Motion carried unanimously to approve the payment of bills totaling $112,025.43. 5.REVIEW OF COMMITTED PROJECTS & CRA PROPERTY. Nabity reviewed the Committed Projects. Tower 217 received their second payment of their grant. 6.AUDIT. Terry Galloway presented the CRA audit for 2014-2015. There were no issues found within the audit. CRA is in compliance. A motion was made by Murray to approve the audit as submitted and seconded by Wilson. Upon roll call vote all present voted aye. Motion carried unanimously to approve the audit. Grand Island Regular Meeting - 2/10/2016 Page 7 / 60 7. DIRECTORS REPORT. 8. ADJOURNMENT. Sandstrom adjourned the meeting at 4:30 p.m. The next meeting is scheduled for February 10, 2016. Respectfully submitted Chad Nabity Director Grand Island Regular Meeting - 2/10/2016 Page 8 / 60 Community Redevelopment Authority (CRA) Wednesday, February 10, 2016 Regular Meeting Item C1 Financial Reports Staff Contact: Chad Nabity Grand Island Regular Meeting - 2/10/2016 Page 9 / 60 Grand Island Regular Meeting - 2/10/2016 Page 10 / 60 Grand Island Regular Meeting - 2/10/2016 Page 11 / 60 Grand Island Regular Meeting - 2/10/2016 Page 12 / 60 Grand Island Regular Meeting - 2/10/2016 Page 13 / 60 Grand Island Regular Meeting - 2/10/2016 Page 14 / 60 Grand Island Regular Meeting - 2/10/2016 Page 15 / 60 Grand Island Regular Meeting - 2/10/2016 Page 16 / 60 Grand Island Regular Meeting - 2/10/2016 Page 17 / 60 Community Redevelopment Authority (CRA) Wednesday, February 10, 2016 Regular Meeting Item D1 Bills Staff Contact: Chad Nabity Grand Island Regular Meeting - 2/10/2016 Page 18 / 60 10-Feb-16 TO: Community Redevelopment Authority Board Members FROM: Chad Nabity, Planning Department Director RE: Bills Submitted for Payment The following bills have been submitted to the Community Redevelopment Authority Treasurer for preparation of payment. City of Grand Island $ 3,493.32 Administration Fees Accounting Officenet Inc. Postage $ 7.80 Lawnscape snow removal $ 70.00 Grand Island Independent $ 16.01 Mayer, Burns, Koenig & Janulewicz Legal Services $ 150.00 Total: $ 3,737.13 Grand Island Regular Meeting - 2/10/2016 Page 19 / 60 Community Redevelopment Authority (CRA) Wednesday, February 10, 2016 Regular Meeting Item E1 Committed Projects Staff Contact: Chad Nabity Grand Island Regular Meeting - 2/10/2016 Page 20 / 60 Grand Island Regular Meeting - 2/10/2016 Page 21 / 60 Community Redevelopment Authority (CRA) Wednesday, February 10, 2016 Regular Meeting Item G1 Fire & Life Safety Grant - 110 E 3rd St Staff Contact: Chad Nabity Grand Island Regular Meeting - 2/10/2016 Page 22 / 60 Grand Island Regular Meeting - 2/10/2016 Page 23 / 60 Grand Island Regular Meeting - 2/10/2016 Page 24 / 60 Grand Island Regular Meeting - 2/10/2016 Page 25 / 60 Grand Island Regular Meeting - 2/10/2016 Page 26 / 60 Community Redevelopment Authority (CRA) Wednesday, February 10, 2016 Regular Meeting Item H1 TIF App - 106 S Webb Rd - Pump & Pantry Inc. Staff Contact: Chad Nabity Grand Island Regular Meeting - 2/10/2016 Page 27 / 60 Grand Island Regular Meeting - 2/10/2016 Page 28 / 60 Grand Island Regular Meeting - 2/10/2016 Page 29 / 60 Grand Island Regular Meeting - 2/10/2016 Page 30 / 60 Redevelopment Plan Amendment Grand Island CRA Area 15 February 2016 The Community Redevelopment Authority (CRA) of the City of Grand Island intends to amend the Redevelopment Plan for Area 15 within the city, pursuant to the Nebraska Community Development Law (the “Act”) and provide for the financing of a specific project in Area 15. Executive Summary: Project Description THE REDEVELOPMENT OF PROPERTY LOCATED AT THE SOUTHWEST CORNER OF WEBB ROAD AND OLD POTASH HIGHWAY (LOT 1 OF ANTONSON SECOND SUBDIVISION) FOR USE AS A LATEST GENERATION BOSSELMAN PUMP AND PANTRY STORE INCLUDING ACQUISTION OF PROPERERTY AND NECESSARY INFRASTRUCTURE AND GRADING IMPROVEMENTS. The use of Tax Increment Financing to aid in rehabilitation expenses associated with acquisition of property and necessary infrastructure and grading improvements to redevelop 106 S. Webb Road (Lot 1 of Antonson Second Subdivision in the City of Grand Island). The use of Tax Increment Financing is an integral part of the development plan and necessary to make this project affordable. The project will result in the construction of a newest generation Pump and Pantry store and carwash on a piece of property that has been vacant for a number of years. The developers feel this project, at this location would not be possible without the use of TIF. Pump and Pantry Inc. made an offer to purchase this property for $900,000 contingent on their ability to secure TIF for the project to offset a portion of the acquisition cost. Acquisition of property is an eligible TIF activity. The property is currently vacant the buildings that were on this property were removed by the current property owner in preparation for redevelopment.. The developer is responsible for and has provided evidence that they can secure adequate debt financing to cover the costs associated with the site work and remodeling. The Grand Island Community Redevelopment Authority (CRA) intends to pledge the ad valorem taxes generated over the 15 year period beginning January 1, 2017 towards the allowable costs and associated financing for the acquisition and site work. TAX INCREMENT FINANCING TO PAY FOR THE REHABILITATION OF THE PROPERTY WILL COME FROM THE FOLLOWING REAL PROPERTY: Property Description (the “Redevelopment Project Area”) 106 S Webb Road in Grand Island Nebraska Legal Descriptions: Lot 1 of Antonson Second Subdivision in Grand Island, Hall County, Nebraska. Grand Island Regular Meeting - 2/10/2016 Page 31 / 60 Existing Land Use and Subject Property Grand Island Regular Meeting - 2/10/2016 Page 32 / 60 The tax increment will be captured for the tax years the payments for which become delinquent in years 2017 through 2031 inclusive. The real property ad valorem taxes on the current valuation will continue to be paid to the normal taxing entities. The increase will come from the construction of a convenience store at this location as permitted in the M2 Heavy Manufacturing Zoning District. Statutory Pledge of Taxes. Pursuant to Section 18-2147 of the Act, any ad valorem tax levied upon real property in the Redevelopment Project Area shall be divided, for the period not to exceed 15 years after the effective date of the provision, which effective date shall be January 1, 2017. a. That portion of the ad valorem tax which is produced by levy at the rate fixed each year by or for each public body upon the redevelopment project valuation shall be paid into the funds, of each such public body in the same proportion as all other taxes collected by or for the bodies; and b. That portion of the ad valorem tax on real property in the redevelopment project in excess of such amount, if any, shall be allocated to and, when collected, paid into a special fund of the Authority to pay the principal of; the interest on, and any premiums due in connection with the bonds, loans, notes, or advances on money to, or indebtedness incurred by, whether funded, refunded, assumed, or otherwise, such Authority for financing or refinancing, in whole or in part, a redevelopment project. When such bonds, loans, notes, advances of money, or indebtedness including interest and premium due have been paid, the Authority shall so notify the County Assessor and County Treasurer and all ad valorem taxes upon real property in such redevelopment project shall be paid into the funds of the respective public bodies. Pursuant to Section 18-2150 of the Act, the ad valorem tax so divided is hereby pledged to the repayment of loans or advances of money, or the incurring of any indebtedness, whether funded, refunded, assumed, or otherwise, by the CRA to finance or refinance, in whole or in part, the redevelopment project, including the payment of the principal of, premium, if any, and interest on such bonds, loans, notes, advances, or indebtedness. Redevelopment Plan Amendment Complies with the Act: The Community Development Law requires that a Redevelopment Plan and Project consider and comply with a number of requirements. This Plan Amendment meets the statutory qualifications as set forth below. 1. The Redevelopment Project Area has been declared blighted and substandard by action of the Grand Island City Council on January 14, 2014.[§18-2109] Such declaration was made after a public hearing with full compliance with the public notice requirements of §18-2115 of the Act. Grand Island Regular Meeting - 2/10/2016 Page 33 / 60 2. Conformation to the General Plan for the Municipality as a whole. [§18-2103 (13) (a) and §18-2110] Grand Island adopted a Comprehensive Plan on July 13, 2004. This redevelopment plan amendment and project are consistent with the Comprehensive Plan, in that no changes in the Comprehensive Plan elements are intended. This plan merely provides funding for the developer to rehabilitate the building for permitted uses on this property as defined by the current and effective zoning regulations. 3. The Redevelopment Plan must be sufficiently complete to address the following items: [§18-2103(13) (b)] a. Land Acquisition: This Redevelopment Plan for Area #15 provides and anticipates real property acquisition by the developer. There is no proposed acquisition by the authority. b. Demolition and Removal of Structures: The project to be implemented with this plan does not provide for the demolition and removal any structures on this property. All structures on the property were removed by the current property owner. c. Future Land Use Plan See the attached map from the 2004 Grand Island Comprehensive Plan. The area immediately to the north and east of this property is planned for commercial or highway commercial development. The Nebraska Department of Roads has the property to the south and the property to the west is used for commercial purposes. This property is in private ownership. [§18-2103(b) and §18-2111] The attached map also is an accurate site plan of the area after redevelopment. [§18-2111(5)] Grand Island Regular Meeting - 2/10/2016 Page 34 / 60 City of Grand Island Future Land Use Map Grand Island Regular Meeting - 2/10/2016 Page 35 / 60 d. Changes to zoning, street layouts and grades or building codes or ordinances or other Planning changes. The area is zoned M2 Heavy Manufacturing zone. No zoning changes are anticipated with this project. No changes are anticipated in street layouts or grades. No changes are anticipated in building codes or ordinances. Nor are any other planning changes contemplated. [§18-2103(b) and §18-2111] e. Site Coverage and Intensity of Use The developer is proposing to build on the site within the constraints allowed by the current zoning district. [§18-2103(b) and §18-2111] f. Additional Public Facilities or Utilities Sewer and water are available to support this development. No new services are anticipated with this development. Electric utilities are sufficient for the proposed use of this building. No other utilities would be impacted by the development. No other utilities would be impacted by the development. [§18-2103(b) and §18-2111] 4. The Act requires a Redevelopment Plan provide for relocation of individuals and families displaced as a result of plan implementation. This property has been vacant with no structures for several years, no relocation is contemplated or necessary. [§18-2103.02] 5. No member of the Authority, nor any employee thereof holds any interest in any property in this Redevelopment Project Area. [§18-2106] No members of the authority or staff of the CRA have any interest in this property. 6. Section 18-2114 of the Act requires that the Authority consider: a. Method and cost of acquisition and preparation for redevelopment and estimated proceeds from disposal to redevelopers. The developer has a contract to purchase this property contingent on approval of the Tax Increment Financing. The cost this property is $900,000 and would be a TIF eligible expense. Grading, storm water management, utility connections and extensions, landscaping and similar site improvements are estimated at $600,000 a portion of which would be eligible for TIF. Planning related expenses for Architectural and Engineering services of $85,000 and are included as a TIF eligible expense. Legal, Developer and Audit Fees including a reimbursement to the City and the CRA of $7,000 are included as Grand Island Regular Meeting - 2/10/2016 Page 36 / 60 TIF eligible expense. The total of eligible expenses for this project is $992,000 at a minimum and potentially as much at $1,592,000. No property will be transferred to redevelopers by the Authority. The developer will provide and secure all necessary financing. b. Statement of proposed method of financing the redevelopment project. The developer will provide all necessary financing for the project. The Authority will assist the project by granting the sum of $748,688 from the proceeds of the TIF Indebtedness issued by the Authority. This indebtedness will be repaid from the Tax Increment Revenues generated from the project. TIF revenues shall be made available to repay the original debt and associated interest after January 1, 2017 through December 2032. c. Statement of feasible method of relocating displaced families. No families will be displaced as a result of this plan. 7. Section 18-2113 of the Act requires: Prior to recommending a redevelopment plan to the governing body for approval, an authority shall consider whether the proposed land uses and building requirements in the redevelopment project area are designed with the general purpose of accomplishing, in conformance with the general plan, a coordinated, adjusted, and harmonious development of the city and its environs which will, in accordance with present and future needs, promote health, safety, morals, order, convenience, prosperity, and the general welfare, as well as efficiency and economy in the process of development, including, among other things, adequate provision for traffic, vehicular parking, the promotion of safety from fire, panic, and other dangers, adequate provision for light and air, the promotion of the healthful and convenient distribution of population, the provision of adequate transportation, water, sewerage, and other public utilities, schools, parks, recreational and community facilities, and other public requirements, the promotion of sound design and arrangement, the wise and efficient expenditure of public funds, and the prevention of the recurrence of insanitary or unsafe dwelling accommodations or conditions of blight. The Authority has considered these elements in proposing this Plan Amendment. This amendment, in and of itself will promote consistency with the Comprehensive Plan. This will have the intended result of preventing recurring elements of blighted conditions including vacant and underutilized building sites. 8. Time Frame for Development Development of this project is anticipated to be completed between April 2016 and December of 2017. Excess valuation should be available for this project for 15 years beginning with the 2017 tax year. Grand Island Regular Meeting - 2/10/2016 Page 37 / 60 9. Justification of Project This space has been vacant for a number of years and has not sold or redeveloped even with aggressive marketing by the owner. The proximity of and appearance of the Nebraska Department of Roads equipment yards adjacent to the site may have an influence on the perceived value of the site. The proposed use and plan would provide screening of the NDOR site from the north. Screening from the south will not be possible without cooperation from NDOR. 10. Cost Benefit Analysis Section 18-2113 of the Act, further requires the Authority conduct a cost benefit analysis of the plan amendment in the event that Tax Increment Financing will be used. This analysis must address specific statutory issues. As authorized in the Nebraska Community Development Law, §18-2147, Neb. Rev. Stat. (2012), the City of Grand Island has analyzed the costs and benefits of the proposed Redevelopment Project, including: Project Sources and Uses. Approximately $748,688 in public funds from tax increment financing provided by the Grand Island Community Redevelopment Authority will be required to complete the project. This investment by the Authority will leverage $2,993,312 in private sector financing; a private investment of $3.99 for every TIF and grant dollar investment.1 Use of Funds. Description TIF Funds Private Funds Total Site Acquisition $748,688 $151,312 $90,000 Site preparation $600,000 $24,174 Legal and Plan*$920,00 $15,000 Building Costs $2,000,000 $2,000,000 Renovation $527,053 Personal Property Soft Costs $150,000 $150,000 TOTALS $748,688 $2,993,312 $3,741,820 Tax Revenue. The property to be redeveloped is anticipated to have a January 1, 2016, valuation of approximately $393,355. Based on the 2015 levy this would result in a real property tax of approximately $8,692. It is anticipated that the assessed value will increase by $2,258,730 upon full completion, as a result of the site redevelopment. This development will result in an estimated tax increase of over $49,913 annually. The tax increment gained from this Redevelopment Project Area would not be available for use as city general tax revenues, for a period of 15 years, or such shorter time as may be 1 This does not include any investment in personal property at this time. Grand Island Regular Meeting - 2/10/2016 Page 38 / 60 required to amortize the TIF bond, but would be used for eligible private redevelopment costs to enable this project to be realized. Estimated 2016 assessed value:$ 393,355 Estimated value after completion $ 2,652,085 Increment value $ 2,258,730 Annual TIF generated (estimated)$ 49,913 TIF bond issue $ 748,688 (a) Tax shifts resulting from the approval of the use of Tax Increment Financing; The redevelopment project area currently has an estimated valuation of $393,355. The proposed redevelopment will create additional valuation of $2,258,730. No tax shifts are anticipated from the project. The project creates additional valuation that will support taxing entities long after the project is paid off. (b) Public infrastructure and community public service needs impacts and local tax impacts arising from the approval of the redevelopment project; No additional public service needs have been identified. Existing water and waste water facilities will not be impacted by this development. The electric utility has sufficient capacity to support the development. It is not anticipated that this will impact schools. Fire and police protection are available and should not be negatively impacted by this development. (c) Impacts on employers and employees of firms locating or expanding within the boundaries of the area of the redevelopment project; This will have minimal impact on employers or employees within the redevelopment project area. It will create a need for additional employees within Bosselman Inc. (d) Impacts on other employers and employees within the city or village and the immediate area that are located outside of the boundaries of the area of the redevelopment project; and This project will not have a negative impact on other employers in any manner different from any other expanding business within the Grand Island area. The Grand Island labor market is tight but this will create additional full time jobs in the regions. This will allow a local company to expand in our community. (e) Any other impacts determined by the authority to be relevant to the consideration of costs and benefits arising from the redevelopment project. This project will produce sales tax from items sold and property taxes on the personal property located within the store and carwash. Grand Island Regular Meeting - 2/10/2016 Page 39 / 60 Time Frame for Development Development of this project is anticipated to be completed during between April of 2016 and December 31 of 2017. The base tax year should be calculated on the value of the property as of January 1, 2016. Excess valuation should be available for this project for 15 years beginning in 2017 with taxes due in 2018. Excess valuation will be used to pay the TIF Indebtedness issued by the CRA per the contract between the CRA and the developer for a period not to exceed 15 years or an amount not to exceed $110,485 the projected amount of increment based upon the anticipated value of the project and current tax rate. Based on the estimates of the expenses of the rehabilitation the developer will spend between $992,000 and $1,592,000 on TIF eligible activities. Grand Island Regular Meeting - 2/10/2016 Page 40 / 60 106 S Webb Rd. COMMUNITY REDEVELOPMENT AUTHORITY OF THE CITY OF GRAND ISLAND, NEBRASKA RESOLUTION NO. 207 RESOLUTION OF THE COMMUNITY REDEVELOPMENT AUTHORITY OF THE CITY OF GRAND ISLAND, NEBRASKA, SUBMITTING A PROPOSED REDEVELOPMENT PLAN TO THE HALL COUNTY REGIONAL PLANNING COMMISSION FOR ITS RECOMMENDATION WHEREAS, this Community Redevelopment Authority of the City of Grand Island, Nebraska ("Authority"), pursuant to the Nebraska Community Development Law (the "Act"), prepared a proposed redevelopment plan (the "Plan") a copy of which is attached hereto as Exhibit 1, for redevelopment of an area within the city limits of the City of Grand Island, Hall County, Nebraska; and WHEREAS, the Authority is required by Section 18-2112 of the Act to submit said to the planning board having jurisdiction of the area proposed for redevelopment for review and recommendation as to its conformity with the general plan for the development of the City of Grand Island, Hall County, Nebraska; NOW, THEREFORE, BE IT RESOLVED AS FOLLOWS: The Authority submits to the Hall County Regional Planning Commission the proposed Plan attached to this Resolution, for review and recommendation as to its conformity with the general plan for the development of the City of Grand Island, Hall County, Nebraska. Passed and approved this ___ day of ___________, 2016. COMMUNITY REDEVELOPMENT AUTHORITY OF THE CITY OF GRAND ISLAND, NEBRASKA. By___________________________ Chairperson ATTEST: __________________________ Secretary Grand Island Regular Meeting - 2/10/2016 Page 41 / 60 106 S Webb Rd. COMMUNITY REDEVELOPMENT AUTHORITY OF THE CITY OF GRAND ISLAND, NEBRASKA RESOLUTION NO. 208 RESOLUTION OF THE COMMUNITY REDEVELOPMENT AUTHORITY OF THE CITY OF GRAND ISLAND, NEBRASKA, PROVIDING NOTICE OF INTENT TO ENTER INTO A REDEVELOPMENT AFTER THE PASSAGE OF 30 DAYS AND OTHER MATTERS WHEREAS, this Community Redevelopment Authority of the City of Grand Island, Nebraska ("Authority"), has received an Application for Tax Increment Financing under the Nebraska Community Development Law (the “Act”) on a project within Redevelopment Area 15, from Pump & Pantry, Inc., (The "Developer") for redevelopment of an area within the city limits of the City of Grand Island as set forth in Exhibit 1 attached hereto area; and WHEREAS, this Community Redevelopment Authority of the City of Grand Island, Nebraska ("Authority"), is proposing to use Tax Increment Financing on a project within Redevelopment Area 15; NOW, THEREFORE, BE IT RESOLVED AS FOLLOWS: Section 1. In compliance with section 18-2114 of the Act, the Authority hereby gives the governing body of the City notice that it intends to enter into the Redevelopment Contract, attached as Exhibit 1, with such changes as are deemed appropriate by the Authority, after approval of the redevelopment plan amendment related to the redevelopment project described in the Redevelopment Contract, and after the passage of 30 days from the date hereof. Section 2. The Secretary of the Authority is directed to file a copy of this resolution with the City Clerk of the City of Grand Island, forthwith. Passed and approved this ___ day of __________, 2016. COMMUNITY REDEVELOPMENT AUTHORITY OF THE CITY OF GRAND ISLAND, NEBRASKA. By ___________________________ Chairperson ATTEST: ___________________ Secretary Grand Island Regular Meeting - 2/10/2016 Page 42 / 60 Community Redevelopment Authority (CRA) Wednesday, February 10, 2016 Regular Meeting Item H2 TIF App - 110 E 3rd St - Wing Properties Staff Contact: Chad Nabity Grand Island Regular Meeting - 2/10/2016 Page 43 / 60 Grand Island Regular Meeting - 2/10/2016 Page 44 / 60 Grand Island Regular Meeting - 2/10/2016 Page 45 / 60 Grand Island Regular Meeting - 2/10/2016 Page 46 / 60 Grand Island Regular Meeting - 2/10/2016 Page 47 / 60 Grand Island Regular Meeting - 2/10/2016 Page 48 / 60 Redevelopment Plan Amendment Grand Island CRA Area 1 February 2016 The Community Redevelopment Authority (CRA) of the City of Grand Island intends to amend the Redevelopment Plan for Area 1 with in the city, pursuant to the Nebraska Community Development Law (the “Act”) and provide for the financing of a specific infrastructure related project in Area 1. Executive Summary: Project Description THE REDEVELOPMENT OF THE BUILDING LOCATED AT 110 E. 3RD STREET (WEST 1/3 OF WILLIAMSON’S FURNITURE STORE) FOR RETAIL USES ON THE FIRST FLOOR AND A RESIDENTIAL APARTMENT ON THE SECOND FLOOR INCLUDING FIRE/LIFE SAFETY IMPROVEMENTS AND BUILDING REHABILITATION AND REMODELING. The use of Tax Increment Financing to aid in rehabilitation expenses associated with redevelopment of the west 1/3 of the Williamson’s Furniture Building located at 110 E 3rd Street into first floor retail space and a second floor apartment. The use of Tax Increment Financing is an integral part of the development plan and necessary to make this project affordable. The project will result in renovating 4,084 square feet of commercial space and an additional upper story residential unit (2,714 square feet) and is consistent with the downtown redevelopment plan and priorities to add 50 residential units downtown by 2019. This project would not be possible without the use of TIF. Wing Properties is the owner of the property. They purchased this property in 2015. The purchase price is not included as an eligible TIF activity. The building is currently vacant. The developer is responsible for and has provided evidence that they can secure adequate debt financing to cover the costs associated with the site work and remodeling. The Grand Island Community Redevelopment Authority (CRA) intends to pledge the ad valorem taxes generated over the 15 year period beginning January 1, 2017 towards the allowable costs and associated financing for the acquisition and site work. TAX INCREMENT FINANCING TO PAY FOR THE REHABILITATION OF THE PROPERTY WILL COME FROM THE FOLLOWING REAL PROPERTY: Property Description (the “Redevelopment Project Area”) 110 E 3rd Street in Grand Island Nebraska Kaufman Building Legal Descriptions: West 22 feet of Lot 7, Block 54, Original Town of Grand Island, Hall County, Nebraska. Grand Island Regular Meeting - 2/10/2016 Page 49 / 60 Existing Land Use and Subject Property Grand Island Regular Meeting - 2/10/2016 Page 50 / 60 The tax increment will be captured for the tax years the payments for which become delinquent in years 2017 through 2031 inclusive. The real property ad valorem taxes on the current valuation will continue to be paid to the normal taxing entities. The increase will come from rehabilitation of this the vacant portions of this historic building for commercial space and upper story residential as permitted in the B3 Heavy Business Zoning District. Statutory Pledge of Taxes. Pursuant to Section 18-2147 of the Act, any ad valorem tax levied upon real property in the Redevelopment Project Area shall be divided, for the period not to exceed 15 years after the effective date of the provision, which effective date shall be January 1, 2017. a. That portion of the ad valorem tax which is produced by levy at the rate fixed each year by or for each public body upon the redevelopment project valuation shall be paid into the funds, of each such public body in the same proportion as all other taxes collected by or for the bodies; and b. That portion of the ad valorem tax on real property in the redevelopment project in excess of such amount, if any, shall be allocated to and, when collected, paid into a special fund of the Authority to pay the principal of; the interest on, and any premiums due in connection with the bonds, loans, notes, or advances on money to, or indebtedness incurred by, whether funded, refunded, assumed, or otherwise, such Authority for financing or refinancing, in whole or in part, a redevelopment project. When such bonds, loans, notes, advances of money, or indebtedness including interest and premium due have been paid, the Authority shall so notify the County Assessor and County Treasurer and all ad valorem taxes upon real property in such redevelopment project shall be paid into the funds of the respective public bodies. Pursuant to Section 18-2150 of the Act, the ad valorem tax so divided is hereby pledged to the repayment of loans or advances of money, or the incurring of any indebtedness, whether funded, refunded, assumed, or otherwise, by the CRA to finance or refinance, in whole or in part, the redevelopment project, including the payment of the principal of, premium, if any, and interest on such bonds, loans, notes, advances, or indebtedness. Redevelopment Plan Amendment Complies with the Act: The Community Development Law requires that a Redevelopment Plan and Project consider and comply with a number of requirements. This Plan Amendment meets the statutory qualifications as set forth below. 1. The Redevelopment Project Area has been declared blighted and substandard by action of the Grand Island City Council on December 19, 2000.[§18-2109] Such declaration was made after a public hearing with full compliance with the public notice requirements of §18-2115 of the Act. Grand Island Regular Meeting - 2/10/2016 Page 51 / 60 2. Conformation to the General Plan for the Municipality as a whole. [§18-2103 (13) (a) and §18-2110] Grand Island adopted a Comprehensive Plan on July 13, 2004. This redevelopment plan amendment and project are consistent with the Comprehensive Plan, in that no changes in the Comprehensive Plan elements are intended. This plan merely provides funding for the developer to rehabilitate the building for permitted uses on this property as defined by the current and effective zoning regulations. 3. The Redevelopment Plan must be sufficiently complete to address the following items: [§18-2103(13) (b)] a. Land Acquisition: The Redevelopment Plan for Area 1 provides for real property acquisition and this plan amendment does not prohibit such acquisition. There is no proposed acquisition by the authority. b. Demolition and Removal of Structures: The project to be implemented with this plan does not provide for the demolition and removal any structures on this property. c. Future Land Use Plan See the attached map from the 2004 Grand Island Comprehensive Plan. All of the area around the site in private ownership is planned for Downtown Commercial development; this includes housing and commercial uses within the same structure. This property is in private ownership. [§18-2103(b) and §18-2111] The attached map also is an accurate site plan of the area after redevelopment. [§18-2111(5)] Grand Island Regular Meeting - 2/10/2016 Page 52 / 60 City of Grand Island Future Land Use Map Grand Island Regular Meeting - 2/10/2016 Page 53 / 60 d. Changes to zoning, street layouts and grades or building codes or ordinances or other Planning changes. The area is zoned B3-Heavy Business zone. No zoning changes are anticipated with this project. No changes are anticipated in street layouts or grades. No changes are anticipated in building codes or ordinances. Nor are any other planning changes contemplated. [§18-2103(b) and §18-2111] e. Site Coverage and Intensity of Use The developer is rehabilitating the existing building. The developer is not proposing to increase the size of the building and current building meets the applicable regulations regarding site coverage and intensity of use. [§18-2103(b) and §18-2111] f. Additional Public Facilities or Utilities Sewer and water are available to support this development. No new services are anticipated with this development. Electric utilities are sufficient for the proposed use of this building. No other utilities would be impacted by the development. The developer will be responsible for replacing any sidewalks damaged during construction of the project. No other utilities would be impacted by the development. [§18-2103(b) and §18-2111] 4. The Act requires a Redevelopment Plan provide for relocation of individuals and families displaced as a result of plan implementation. This property, owned by the developer, is vacant and has been vacant for more than 1 year; no relocation is contemplated or necessary. [§18-2103.02] 5. No member of the Authority, nor any employee thereof holds any interest in any property in this Redevelopment Project Area. [§18-2106] No members of the authority or staff of the CRA have any interest in this property. 6. Section 18-2114 of the Act requires that the Authority consider: a. Method and cost of acquisition and preparation for redevelopment and estimated proceeds from disposal to redevelopers. The developer owns this property and acquisition is not part of the request for tax increment financing. The estimated cost of rehabilitation of this property is $551,227. Planning related expenses for Architectural and Engineering services of $10,000 and are Grand Island Regular Meeting - 2/10/2016 Page 54 / 60 included as a TIF eligible expense. Legal, Developer and Audit Fees including a reimbursement to the City and the CRA of $5,000 are included as TIF eligible expense. The total of eligible expenses for this project is $566,227. No property will be transferred to redevelopers by the Authority. The developer will provide and secure all necessary financing. b. Statement of proposed method of financing the redevelopment project. The developer will provide all necessary financing for the project. The Authority will assist the project by granting the sum of $110,485 from the proceeds of the TIF Indebtedness issued by the Authority. This indebtedness will be repaid from the Tax Increment Revenues generated from the project. TIF revenues shall be made available to repay the original debt and associated interest after January 1, 2017 through December 2032. c. Statement of feasible method of relocating displaced families. No families will be displaced as a result of this plan. 7. Section 18-2113 of the Act requires: Prior to recommending a redevelopment plan to the governing body for approval, an authority shall consider whether the proposed land uses and building requirements in the redevelopment project area are designed with the general purpose of accomplishing, in conformance with the general plan, a coordinated, adjusted, and harmonious development of the city and its environs which will, in accordance with present and future needs, promote health, safety, morals, order, convenience, prosperity, and the general welfare, as well as efficiency and economy in the process of development, including, among other things, adequate provision for traffic, vehicular parking, the promotion of safety from fire, panic, and other dangers, adequate provision for light and air, the promotion of the healthful and convenient distribution of population, the provision of adequate transportation, water, sewerage, and other public utilities, schools, parks, recreational and community facilities, and other public requirements, the promotion of sound design and arrangement, the wise and efficient expenditure of public funds, and the prevention of the recurrence of insanitary or unsafe dwelling accommodations or conditions of blight. The Authority has considered these elements in proposing this Plan Amendment. This amendment, in and of itself will promote consistency with the Comprehensive Plan. This will have the intended result of preventing recurring elements of unsafe buildings and blighting conditions. Grand Island Regular Meeting - 2/10/2016 Page 55 / 60 8. Time Frame for Development Development of this project is anticipated to be completed between April 2016 and December of 2017. Excess valuation should be available for this project for 15 years beginning with the 2017 tax year. 9. Justification of Project This is an historic building in downtown Grand Island that will be preserved with this project. The addition of a new upper story residential unit is consistent with goals to build 50 new residential units in downtown Grand Island by 2019 and with the goals of the 2014 Grand Island housing study and Grow Grand Island. The renovated commercial space will provide opportunities for more businesses to locate downtown. 10. Cost Benefit Analysis Section 18-2113 of the Act, further requires the Authority conduct a cost benefit analysis of the plan amendment in the event that Tax Increment Financing will be used. This analysis must address specific statutory issues. As authorized in the Nebraska Community Development Law, §18-2147, Neb. Rev. Stat. (2012), the City of Grand Island has analyzed the costs and benefits of the proposed Redevelopment Project, including: Project Sources and Uses. Approximately $110,485 in public funds from tax increment financing provided by the Grand Island Community Redevelopment Authority will be required to complete the project. This property has received façade improvement funding of $111,344 and is eligible for a life/safety grant of $20,000. This investment by the Authority will leverage $414,398 in private sector financing; a private investment of $1.71 for every TIF and grant dollar investment.1 Use of Funds. Description TIF Funds Private Funds Total Site Acquisition $90,000 $90,000 Site preparation $24,174 $24,174 Legal and Plan*$15,000 $15,000 Building Costs Renovation $95,485 $431,568 $527,053 Personal Property Soft Costs TOTALS $110,485 $545,742 $656,227 Tax Revenue. The property to be redeveloped is anticipated to have a January 1, 2016, valuation of approximately $49,021. Based on the 2015 levy this would result in a real property tax of approximately $1,083. It is anticipated that the assessed value will 1 This does not include any investment in personal property at this time. Grand Island Regular Meeting - 2/10/2016 Page 56 / 60 increase by $333,245 upon full completion, as a result of the site redevelopment. This development will result in an estimated tax increase of over $7,364 annually. The tax increment gained from this Redevelopment Project Area would not be available for use as city general tax revenues, for a period of 15 years, or such shorter time as may be required to amortize the TIF bond, but would be used for eligible private redevelopment costs to enable this project to be realized. Estimated 2016 assessed value:$ 49,021 Estimated value after completion $ 382,266 Increment value $ 333,245 Annual TIF generated (estimated)$ 7,364 TIF bond issue $ 110,485 (a) Tax shifts resulting from the approval of the use of Tax Increment Financing; The redevelopment project area currently has an estimated valuation of $49,021. The proposed redevelopment will create additional valuation of $333,245. No tax shifts are anticipated from the project. The project creates additional valuation that will support taxing entities long after the project is paid off. (b) Public infrastructure and community public service needs impacts and local tax impacts arising from the approval of the redevelopment project; No additional public service needs have been identified. Existing water and waste water facilities will not be impacted by this development. The electric utility has sufficient capacity to support the development. It is not anticipated that this will impact schools. Fire and police protection are available and should not be negatively impacted by this development. The addition of life safety elements to this building including fire sprinklers and a second exit actually reduce the chances of negative impacts to the fire department. (c) Impacts on employers and employees of firms locating or expanding within the boundaries of the area of the redevelopment project; This will provide additional housing options in the downtown area and will provide commercial space for new or expanded commercial uses in the downtown. (d) Impacts on other employers and employees within the city or village and the immediate area that are located outside of the boundaries of the area of the redevelopment project; and This project will not have a negative impact on other employers in any manner different from any other expanding business within the Grand Island area. The Grand Island labor market is tight but this will create additional full time jobs in the regions. This will allow a local company to expand in our community. Grand Island Regular Meeting - 2/10/2016 Page 57 / 60 (e) Any other impacts determined by the authority to be relevant to the consideration of costs and benefits arising from the redevelopment project. This project is consistent the goals of the Council, the Downtown BID, the CRA, and Grow Grand Island to create additional housing units in downtown Grand Island. Time Frame for Development Development of this project is anticipated to be completed during between April of 2016 and December 31 of 2017. The base tax year should be calculated on the value of the property as of January 1, 2016. Excess valuation should be available for this project for 15 years beginning in 2017 with taxes due in 2018. Excess valuation will be used to pay the TIF Indebtedness issued by the CRA per the contract between the CRA and the developer for a period not to exceed 15 years or an amount not to exceed $110,485 the projected amount of increment based upon the anticipated value of the project and current tax rate. Based on the estimates of the expenses of the rehabilitation the developer will spend at least $566,000 on TIF eligible activities. The CRA will reserve the right to issue additional debt for this project upon notification by the developer of sufficient expenses and valuation to support such debt in the form of a second or third bond issuance. Grand Island Regular Meeting - 2/10/2016 Page 58 / 60 110 E 3rd St. COMMUNITY REDEVELOPMENT AUTHORITY OF THE CITY OF GRAND ISLAND, NEBRASKA RESOLUTION NO. 209 RESOLUTION OF THE COMMUNITY REDEVELOPMENT AUTHORITY OF THE CITY OF GRAND ISLAND, NEBRASKA, SUBMITTING A PROPOSED REDEVELOPMENT PLAN TO THE HALL COUNTY REGIONAL PLANNING COMMISSION FOR ITS RECOMMENDATION WHEREAS, this Community Redevelopment Authority of the City of Grand Island, Nebraska ("Authority"), pursuant to the Nebraska Community Development Law (the "Act"), prepared a proposed redevelopment plan (the "Plan") a copy of which is attached hereto as Exhibit 1, for redevelopment of an area within the city limits of the City of Grand Island, Hall County, Nebraska; and WHEREAS, the Authority is required by Section 18-2112 of the Act to submit said to the planning board having jurisdiction of the area proposed for redevelopment for review and recommendation as to its conformity with the general plan for the development of the City of Grand Island, Hall County, Nebraska; NOW, THEREFORE, BE IT RESOLVED AS FOLLOWS: The Authority submits to the Hall County Regional Planning Commission the proposed Plan attached to this Resolution, for review and recommendation as to its conformity with the general plan for the development of the City of Grand Island, Hall County, Nebraska. Passed and approved this ___ day of ___________, 2016. COMMUNITY REDEVELOPMENT AUTHORITY OF THE CITY OF GRAND ISLAND, NEBRASKA. By___________________________ Chairperson ATTEST: __________________________ Secretary Grand Island Regular Meeting - 2/10/2016 Page 59 / 60 110 E 3rd St. COMMUNITY REDEVELOPMENT AUTHORITY OF THE CITY OF GRAND ISLAND, NEBRASKA RESOLUTION NO. 210 RESOLUTION OF THE COMMUNITY REDEVELOPMENT AUTHORITY OF THE CITY OF GRAND ISLAND, NEBRASKA, PROVIDING NOTICE OF INTENT TO ENTER INTO A REDEVELOPMENT AFTER THE PASSAGE OF 30 DAYS AND OTHER MATTERS WHEREAS, this Community Redevelopment Authority of the City of Grand Island, Nebraska ("Authority"), has received an Application for Tax Increment Financing under the Nebraska Community Development Law (the “Act”) on a project within Redevelopment Area 1, from Wing Properties, (The "Developer") for redevelopment of an area within the city limits of the City of Grand Island as set forth in Exhibit 1 attached hereto area; and WHEREAS, this Community Redevelopment Authority of the City of Grand Island, Nebraska ("Authority"), is proposing to use Tax Increment Financing on a project within Redevelopment Area 1; NOW, THEREFORE, BE IT RESOLVED AS FOLLOWS: Section 1. In compliance with section 18-2114 of the Act, the Authority hereby gives the governing body of the City notice that it intends to enter into the Redevelopment Contract, attached as Exhibit 1, with such changes as are deemed appropriate by the Authority, after approval of the redevelopment plan amendment related to the redevelopment project described in the Redevelopment Contract, and after the passage of 30 days from the date hereof. Section 2. The Secretary of the Authority is directed to file a copy of this resolution with the City Clerk of the City of Grand Island, forthwith. Passed and approved this ___ day of __________, 2016. COMMUNITY REDEVELOPMENT AUTHORITY OF THE CITY OF GRAND ISLAND, NEBRASKA. By ___________________________ Chairperson ATTEST: ___________________ Secretary Grand Island Regular Meeting - 2/10/2016 Page 60 / 60