The Board of Directors of the Redevelopment Agency of Salt Lake City, Utah, met on Tuesday, July 12, 2016 at 1:10 p.m. in Room 326, Committee Room, City County Building, 451 South State.
In Attendance: Directors Lisa Adams, Derek Kitchen, James Rogers, Erin Mendenhall, Stan Penfold, and Andrew Johnston.
Absent: Director Charlie Luke.
Staff in Attendance: Jackie Biskupski, Chief of Staff; Justin Belliveau, Interim Executive Director; Ed Butterfield, Senior Project Manager; Jill Wilkerson-Smith, Project Manager; Ben Davis, Project Manager; David Arteaga, Project Coordinator; Cara Lindsley, Project Coordinator; Susan Lundmark, Project Coordinator; Tammy Hunsaker, Project Coordinator; Amanda Holty, Marketing and Communications Coordinator; Jim Sirrine, Property Manager; Katie Lewis, Agency Legal Counsel; Crayola Berger, Accountant II; Jolynn Walz, Office Manager; Kalli Ruiz, Office Facilitator; Katherine Potter, Senior Advisor; Teresa Beckstrand, Finance Department; Cindy Gust-Jenson, Salt Lake City Council Office; Lynn Pace, Senior Advisor Mayor’s Office; Jeff Tumlin, Nelson Nygaard; and Phil Olmstead, Nelson Nygaard.
Director Adams presided at and conducted the meeting.
2. 1:10:06 PM Briefing by the Staff
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Director Johnston made a motion to approve the minutes from the meeting held May 31, 2016 and June 14, 2016. Vice-Chairperson Kitchen seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved. View Minutes (May 31) and View Minutes (June 14)
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Chairperson Adams suggested that Board members may need to meet more than once a month when crucial items need to be addressed or the quantity of items is too excessive for one agenda/meeting.
6. 1:12:36 PM Public Comments
7. Redevelopment Business Action Items
A. 1:12:49 PM 2016/2017 Budget
1. Public Hearing for Adoption of the First Amendment to the 2016/2017 Annual Implementation Budget.
Director Penfold made a motion to close the public hearing. Director Mendenhall seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved.
2. 1:14:59 PM Review and approval of the Proposed First Amendment to the Annual Implementation Budget for the Fiscal Year Commencing July 1, 2016 and Ending June 30, 2017.
Chief Administrative Officer Belliveau explained that the First Amendment identifies appropriations for ongoing expenditures that were discussed at the June 14, 2016 Board meeting, as well as certain other ongoing expenditures that had been identified since that meeting.
Chief Administrative Officer Belliveau presented the following information that was requested by the Board.
Chief Administrative Office Belliveau presented the First Amendment to the 2016/2017 Annual Implementation budget and per the Board’s request provided additional information on the following projects:
Central Business District
-Gallivan Branding
-222 South Main Reimbursement
Depot District
-Public Improvements and Marketing
Chief Administrative Office Belliveau explained that when considering the adoption of the proposed budget amendment, it is important to point out the following additional obligations that were identified in the weeks following the June Board meeting:
Central Business District
o Gallivan Utah Center- the proposed budget amendment includes an appropriation of $35,000 to fund unforeseen façade renovation costs related to work that must be completed to fulfill contractual commitments to tenants.
West Temple Gateway
o Central 9th Development- the proposed budget amendment includes an appropriation of $45,000 to fulfill the final payment related to the RDA’s purchase of the property located at 865-867 S 200 W that must be made by September 2017.
Director Penfold made a motion to adopt the First Amendment to the 2016/2017 Annual Implementation Budget (Resolution R-28-2016). Vice-Chairperson Kitchen seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved.
B. Consideration and adoption of a Resolution of the Board of Directors of the Redevelopment Agency of Salt Lake City authorizing the preparation of a Draft Community Reinvestment Project Area Plan for the Northwest Quadrant Project Area.
The Redevelopment Agency requests that the Board consider adopting a Resolution authorizing the preparation of a Draft Community Reinvestment Project Area Plan as the first step in the creation of a Northwest Quadrant Community Reinvestment Area. View Attachment
Director Rogers made a motion to adopt a Resolution authorizing the preparation of a Draft Community Reinvestment Project Area Plan for the Northwest Quadrant Project Area (Resolution R-29-2016). Vice-Chairperson Kitchen seconded the motion. Director Mendenhall suggested that there be some exploration of expanding Staff to sufficiently cover all project area needs. Upon roll call, Chairperson Adams declared the motion unanimously approved.
C. 1:55:33 PM Consideration and Adoption of a Resolution to Negotiate an Agreement with the Joint Venture of Hines Interests Limited Partnership and the LaSalle Group for the Redevelopment of RDA-owned Property Located at 144 and 156 South Main Street.
D. Policy Discussion
1. 2:00:30 PM Discussion and Formation of a Real Property Disposition Policy.
Chairperson Adams asked Staff to elaborate on the property Categorization and how a property would be designated into the two tiers. Mr. Arteaga detailed two tiers:
A. Tier 1
Real properties that are RDA-owned and meet at least one of the following definitions:
a. Property is specifically identified in an adopted Salt Lake City master plan.
b. Property is a parcel or parcel assemblage that totals two (2) or more contiguous acres in size.
c. Property is listed on the local or national register of historic places as historically significant.
d. Property is fronting or adjacent to city-owned property of at least 0.5 acres in size.
B. Tier 2
Real properties that are RDA-owned and are not otherwise included in Tier 1.
Director Mendenhall stated that she is concerned there may not be the correct checks and balances between the Executive and Legislative branches. Mr. Arteaga said there would be several reporting mechanisms in place to create the appropriate checks and balances.
Ms. Hunsaker explained the reporting framework for each category of property. A semiannual report would be provided for Both Tier 1 and Tier 2 properties. Additional reporting requirements would be triggered for Tier 2 properties. This would include an update to the Board at the following steps of the disposition process: pre-disposition, developer selection, and development agreement.
Ms. Hunsaker proceeded to explain the proposed methods of disposition, which would be either competitively marketed or exclusively negotiated. Regardless of the method of disposition, staff would ensure that the disposition process supports city master plans and policies, RDA strategic plans, and affordable housing needs. Methods of competitively marketing property include RFQ, RFP, or marketing the property on an open-ended basis. An exclusively negotiated sale would only be available only under one of the following criteria:
a. The property is landlocked.
b. Sale to an adjacent property owner to facilitate redevelopment objectives as defined in a project area strategic plan.
c. Sale to a non-profit or governmental agency for a community development or public use.
d. Sale of property that has been competitively offered with no competitive responses received.
e. Sale of property that has previously been used as a right of way that is no longer required.
f. Property exchanges to facilitate redevelopment objectives as defined in a project area strategic plan.
Chairperson Adams questioned whether or not the RDA would be too restrictive in options for disposition if the disposition policy is tied to RDA strategic plans.
Ms. Hunsaker explained the proposed process for determining sales price during the disposition process. The sales price of the property would be fair market value as determined by an Agency-commissioned appraisal. Property may be discounted below fair market value to support the implementation of project area strategic plans, and discounts would be subject to approval by a majority vote of the Board if a property is to be sold at a discount greater than 10% off of appraised fair market value.
After a brief discussion, Director Penfold requested that staff provide additional information on the need for and benefits of a property categorization system that classifies each RDA-owned property as either Tier 1 or Tier 2. Ms. Hunsaker stated that staff would return with the information at the next Board meeting.
2) 2:17:14 PM Discussion and Formation of Policy concerning the Redevelopment Agency’s Annual Budget.
Chief Administrative Officer Belliveau explained that as a part of the recent changes to the Agency’s bylaws, the RDA Board identified and prioritized a series of policies to be revised. The budget policy ranked as a high priority. He said that the primary objective of the budget policy revision is to align the RDA budget process and practices with those related to Salt Lake City's Budget. In an effort to draft a budget policy, staff researched existing Agency budget practices, Salt Lake City budget ordinances, and the best practices of Redevelopment Agencies throughout Utah. Chief Administrative Officer Belliveau stated staff is proposing changes to several aspects of the RDA’s budget. He presented the following:
1) Utah Fiscal Procedures Act
The RDA is not currently obligated to comply with the Utah Fiscal Procedures Act, however, its budget practices have been consistent with the act. The purpose of the budget policy is therefore to clarify that conformance with the act is required, but should have no practical impact on how the RDA establishes its annual budget, other than to ensure that it will be prepared, presented, and administered in a manner that is consistent with the rest of the City’s budget. Staff from the Department of Finance will also be closely involved to ensure that terminology and practices related to budget preparation, as well as purchasing and procurement practices align with the City’s, and will advise staff and the Board on any exceptions that may apply to the RDA.
2) Budget Presentation
The RDA budget will include a full and complete narrative of all accounts and will be presented to the Board as a component of the Mayor's submittal of the City budget on the first Tuesday of May. Currently, the RDA initiates is budget process on a distinct track from the rest of the City’s budget. Incorporating the RDA’s budget as part of the City’s will promote greater alignment of resources and collaboration among various City Departments and Divisions in achieving goals in RDA project areas.
3) Operations Funds
Funding for ongoing contractual obligations and commitments, as well as for projects or other activities anticipated to be commenced and funded during the fiscal year, will be established through appropriations identified as “Operations Funds.” The appropriation of Operations Funds when the budget is established would provide the Agency the ability to expend these funds without further authorization from the Board of Directors. Any Operations Funds that are unspent at the end of the fiscal year will become part of a reserve, identified as “Unallocated Budget” and will not be available for expenditure until re-appropriated by the Board. Currently, the RDA’s practice is that funds designated for a particular project retain that designation, regardless of whether the funds are expended. Consequently, the RDA’s financial statements include numerous project accounts that contain unspent funds. The proposed budget policy will eliminate that potential, and will improve the legibility and transparency of the RDA’s financial reports.
4) Capital Project
The Board may designate certain RDA projects that will require funding over several years as a "Capital Project." The Board may allow for multi-year funding for designated capital projects, the funding of which may stretch beyond the fiscal year in which the initial capital project's account was created. These initiatives will be clearly identified as such on the RDA’s financial statements and in the budget narrative in order to promote transparency. This will be further advanced by creating a single cost center for a Capital Project to which funding will be allocated and from which expenditures will be made each year. It is currently the RDA’s practice to establish a new cost center each time that a particular project is funded, the result of which is that there may be several cost centers associated with one particular project on the RDA’s financial statements.
The budget process would also allow the Board and the Mayor the opportunity to re-appropriate funding from a particular Capital Project account to a different RDA project. This would involve the Board making policy findings providing reasons why the previously-funded Capital Project is no longer necessary for project area development.
Director Mendenhall expressed her appreciation of the proposed changes.
Director Penfold made a motion to adopt the resolution approving the amendment to the UPAC Operating Agreement, provided that legal language be incorporated in the contract which allows the opportunity to renegotiate or terminate, if there is an operational deficit. Director Rogers seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved. (See July 19, 2016 minutes for resolution - Resolution R-32-2016)
9. Redevelopment Business Written Briefings.
A. 4:00:16 PM Status Report on RDA Loan Portfolio.
The memorandum provides a summary of costs associated with Gallivan Avenue repair projects and a Phase 1 marketing project. View Attachment
C. 4:00:25 PM Summary of Pending Tax Appeal for 222 South Main.
Written briefing describing the RDA's 2014 and 2015 tax increment 0 reimbursement to the owners of 222 South Main. View Attachment
10. Consent
Director Penfold made a motion to approve the Consent Agenda. Director Mendenhall seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved.
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11. Closed Meeting
A. 4:00:55 PM Consider Adopting A Motion To Enter Into A Closed Meeting In Keeping With Utah Code To Discuss Pending Litigation and/or The Acquisition /Disposition Of Real Property and/or Attorney-Client Matters That Are Privileged Pursuant To Utah Code Ann. § 78b-1-137(2).
Director Mendenhall made a motion to enter into a closed meeting to discuss matters of pending litigation and/or the acquisition/disposition of real property and/or attorney-client matters and that the Board meeting would stand adjourned at the conclusion of the closed meeting. Director Rogers seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved.
There being no further business, Chairperson Adams called for a motion to exit the closed meeting. Director Rogers made a motion to exit the closed meeting, Vice-Chairperson Kitchen seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved and the closed meeting. The meeting was adjourned at 4:30 PM.
12. Adjournment.
There being no further business, the meeting was adjourned.