September 13, 2016

 

The Board of Directors of the Redevelopment Agency of Salt Lake City, Utah, met on Tuesday, September 13, 2016 at 2:04 p.m. in Room 326, Committee Room, City County Building, 451 South State.

 

In Attendance: Directors Lisa Adams, Stan Penfold, Derek Kitchen, James Rogers, Erin Mendenhall, Charlie Luke, and Andrew Johnston.

 

Staff in Attendance: Justin Belliveau, Chief Administrative Officer; Patrick Leary, Mayor Office; Edward Butterfield, Senior Project Manager; Kort Utley, Senior Project Manager; Tammy Hunsaker, Project Coordinator; David Arteaga, Project Manager; Benjamin Davis, Project Manager; Cara Lindsley, Project Coordinator; Nancy Monteith, Parks and Public Lands; Mike Akerlow, Housing and Neighborhood Development; Micah Peters, Clearwater Homes LLC; and Kyle Jardine, PEG Development.

 

Director Adams presided at and conducted the meeting.

 

Some items may be discussed in an order different than listed on the agenda, time stamps shown indicate when items were discussed.

 

A.    Comments:

 

1.    General Comments to the Board.

 

There were no public comments.

 

B.    Redevelopment Agency Business

 

1.    2:10:15 PM Approval of Minutes

 

Vice-Chairperson Kitchen made a motion to approve the minutes from the meetings held July 12, 2016 and July 19, 2016. Director Mendenhall seconded the motion. Upon roll call, the motion passed unanimously.  Director Luke was not present for the vote.

 

2.    2:11:40 PM Report and Announcements from the Executive Director.

 

Patrick Leary stated that the Mayor’s office is comfortable with the Board meeting agendas and schedule moving forward with regards to adopting the Second Amendment to the RDA’s budget and expressed his and Mayor Biskupski’s appreciation to RDA Staff and Council Staff for their hard work and effort, as we work through these changes. Chairperson Adams agreed.

 

3.    Second Amendment to the FY 2017 Budget, including plans for Housing Funds. View Attachment

 

Chief Administrative Officer Belliveau, Mr. Butterfield, and Mr. Utley reviewed the Second Amendment to the 2016-2017 RDA Budget, including Housing Funds, RDA funds budgeted in previous years, ongoing obligations and Strategic Plan Priority Projects.  They also highlighted projects with immediate funding needs throughout the RDA project areas.

 

During the presentation, Board members asked for the following:

 

•     Director Mendenhall requested the Pioneer Park Coalition attend a future meeting to discuss the match requested from the RDA.

 

•     Chairperson Adams requested a list of RDA owned art pieces and where they are located.

 

•     Director Penfold asked for staff to look into the use of impact fees for the trail portion of the 900 South Streetscape Project. 

 

•     Director Penfold asked staff to work with Public Utilities on their future plans and encourage them to participate in funding the proposed water main upgrade along 200 West within the West Temple Gateway Project Area.  

 

•     Director Mendenhall felt that it was odd that the RDA pay the rent for a Police Department’s building space and asked that ways are determined for the City to pay for this out of the General fund.

 

•     Director Penfold requested staff look at all project areas and the option to utilize impact fees for planning and assessment of parks.

 

•     Director Penfold suggested working with UTA on matching funds for the reconstruction of Folsom Trail.

 

•     Director Penfold suggested reimbursing property owners along 400 West for improvements they make to the frontage of their properties, within the public right-of-way. The Granary District will likely never generate enough funds to reconstruct 400 West all at once. 

 

•     Director Penfold said as the tax increment increases in the Block 70 Project Area, he would like to have a future discussion on shifting the debt burden solely to the Block 70 CDA, to free up future revenue within the CBD Project Area.

 

3:31:27 PM Due to the length of this discussion and amount of materials to review, Chairperson Adams suggested postponing the remaining discussion to provide Board members additional time to review the materials and prepare questions. Chairperson Adams conducted a straw poll on postponing this item until the October meeting. All Board members supported postponing this item.

 

4.    4:10:37 PM Land Disposition Policy Discussion – discuss and consider approval. View Attachment

 

Ms. Hunsaker explained that RDA staff presented an initial draft of the Real Property Disposition policy to the Board during the July 2016 meeting. In its discussion, the Board requested that staff provide additional information on the need for a property categorization system that classifies each RDA-owned property as either Tier 1 or Tier 2 and determines the appropriate process for reporting to the Board. Since then staff has analyzed the property categorization system and recommends retaining the system as previously presented for the following reasons:

 

1. The property categorization system will allow the RDA to be more nimble in the disposition of Tier 1 properties.

2. The property categorization system will provide consistency with the equivalent policy for disposition of city-owned land.

3. Upon consultation with the City Attorney’s Office, it was concluded that the property categorization system will assist in preserving separation of powers.

 

Ms. Hunsaker said that the Redevelopment Advisory Committee has reviewed this information and they are in favor of the policy, but suggested adding the identification of properties in project area plans to the Tier 1 categorization criteria.

 

Mr. Arteaga provided an overview of the property categorization and reporting process and asked Board members if they had any questions.

 

Board members had questions on how to identify critical properties during the project area plan process. Staff members said they would look into ways to achieve this in keeping with the Separation of Powers. Katie Lewis added that the City Attorney’s Office would provide guidance of this analysis.

 

5:35:43 PM Director Penfold requested detailed information on staff’s recommendation on a categorization system of how properties fall in Tier 1 or Tier 2. He suggested a simplified breakdown looking at how a property might qualify for either tier.

 

5.       5:17:13 PM Policy Discussion on Housing in RDA Project Area Strategic plans.

View Attachment

 

Ms. Hunsaker explained that staff is working to ensure that RDA policies coordinate with its own internal and citywide policies. Recently, a policy question arose as to the consistency between the project area strategic plans and the policies of the RDA’s funding programs. Under current policy, projects supported through the Tax Increment Reimbursement Program, the RDA Loan Program, and disposition of real property must align with the applicable project area strategic plan. Strategic plan objectives support housing for a mix of incomes for the majority of project areas. However, the North Temple and West Temple Gateway strategic plans specify that RDA efforts will focus on market-rate housing in order to diversify the existing housing stock in those project areas.

 

Ms. Hunsaker said it may be necessary to consider potential policy conflicts that may arise between strategic plans and broader housing policies and the Board may want to consider updating or clarifying its housing goals as articulated in the various project area strategic plans.

 

Ms. Hunsaker added that the Redevelopment Advisory Committee suggested that this item not be addressed until the City’s Housing Plan is completed to ensure aligning the policies. 

 

Director Penfold suggested that instead of creating an RDA housing policy where affordable or market-rate housing is the only option, the policy needs to be reevaluated to determine the appropriate mix of housing in an RDA project area or neighborhood. Director Johnston stated that he agrees with Director Penfold, but said that the rules for the City’s and RDA’s housing policy do not need to be exactly the same, due to the RDA having resources that could jump start projects that may not develop organically.

 

Ms. Hunsaker stated that staff will continue to coordinate its efforts with HAND to align the RDA’s Housing Policy with the City’s Housing Policy.

 

6.       4:37:10 PM Utah Paperbox Terms – discussion and consider approval. View Attachment

 

Mr. Davis provided an overview on the proposed affordable housing development for the property located at 340 West 200 South. He explained that staff has been working with Clearwater Homes LLC and Peg Development to create a concept plan that is consistent with the vision plan approved by the RDA Board and also evaluating a range of affordable housing alternatives that considers the level of affordability, length of affordability, and incentive/exchange of value required to make the project economically viable.  Mr. Davis added that along with working with the developer, staff has been working closely with Housing and Neighborhood Development to determine possible alternatives for this project.

Mr. Davis reviewed the proposed exchange of value for each alternative listed below.

•     Alternative A: Under this alternative, the Developer would provide 0 affordable units and pay $3,220,000 in exchange for the Property. If this alternative is selected, the sale proceeds could be appropriated to future RDA projects.

 

•     Alternative B: Under this alternative, the Developer would provide 36 units at 60% of AMI for 30 years and pay $0 in exchange for the Property.

 

•     Alternative C: Under this alternative, the Developer would provide 18 units at 50% of AMI and 18 units at 60% of AMI for 30 years and pay $0 in exchange for the Property. Additionally under this alternative, the RDA would grant the Developer $600,000 to offset revenue lost from the lower AMI units. Please note that a reduced incentive/exchange of value could be possible should the number of 60% of AMI units be increased and the number of 50% of AMI units be decreased.

 

•     Alternative D: Under this alternative, the RDA and the Developer would mutually agree to conclude negotiations and the RDA would seek another partner to redevelop the Property through a competitive process. It should be noted, however, that the economics of any project that achieves the level of affordability sought here would likely require a similar level of public support.

 

Mr. Davis stated that RAC has reviewed and discussed each of the alternatives and recommended Alternative B with the caveat that in order for the RDA  to capture the value of this investment in affordable housing, that the land sale be subject to: 1) Developer will provide the necessary documentation and site access pursuant to HAND’s annual audit process and 2) that a deed restriction be recorded against the Property stating that 1/30th of the land write down be forgiven for every year, or $107,333 per year, that the project complies with the Affordability Requirement

 

Micah Peters and Kyle Jardine are called to the table. Mr. Peters hands each Board member a copy of an exhibit and explained his concern with the financial penalty language associated with the thirty year deed restriction and the cost and loss of rents over time, especially when the project enters into its thirteenth year. Mr. Peters added that although he is comfortable with any of the alternatives, he is concerned with RAC’s additional language being added to the deed restriction. He explained this requirement could potentially limit future financing or selling of the property. Mr. Peters suggested that once the project completes its thirteen year, the additional language from the deed restriction is removed and only the reporting mechanism be required.

 

Vice-Chairperson Kitchen asked Mike Akerlow if HAND had an opinion on this project. Mr. Akerlow stated he and his staff would need additional time to review the information provided by the developer at this meeting.

 

Director Johnston stated he felt that since the City Council and RDA Board have not completed its housing policies it is somewhat difficult to decide the best direction for this project. He suggested being more conservative in this test case by selecting Alternative B and use the $600,000 that would have been used in Alternative C toward a future housing project, once the housing policies are completed and more information is available from this project/experience.

 

5:06:35 PM Vice-Chairperson Kitchen made a motion to approve Alternative B, (Resolution R-33-2016) with a deed restriction on the property requiring affordability for thirty years, but enforcement mechanism on the deed restriction be removed after the thirteenth year, after which point only reporting would be required. Director Penfold seconded the motion. Chairperson Adams made a friendly amendment to the motion that the deed restriction language be removed after fifteen years. The friendly motion was accepted by Vice-Chairperson Kitchen and Director Penfold. Upon roll call, the motion passed unanimously.

 

7.       5:10:28 PM Report and Announcements from the Staff.

 

Wasatch Green Team

The Wasatch Green Team will hold a ribbon cutting and press release on September 28 at 10 AM for the job training garden located at 648 W 100 S. Board members are also invited to a tour of the property on September 27 at 2:30 PM.

 

Eccles Theater

The RDA will host a ribbon cutting and civic dedication of the Eccles Theater on October 18th at 10 AM.

 

On October 21st a premier performance and celebration will be held at the theater. Ticket costs range from $50 - $200 per seat. This is a single purpose production that is created specifically for the grand opening, which encompasses local and national arts groups, performers, and entertainers. 

 

An open house for the general public will be held on October 22nd from 10 AM – 5 PM.

 

A live broadcast of “Music and the Spoken Word” on October 23. Arrival time is 8:45 AM and the broadcast goes from 9:30 AM – 10 AM. Once the broadcast is compete parts of the theater will remain open for people to tour the facility.

 

8.       5:34:10 PM Report of the Chair and Vice Chair.

 

Update on the transition to separation of powers

Chairperson Adams stated she has requested that Council staff compile a list to identify the roles and responsibilities of the Council staff and RDA staff when preparing materials for RDA meetings. Chairperson Adams said she would like Board members to review this during the October meeting.

 

Meeting Schedule

An RDA meeting will be held on October 25, 2016, to provide additional time for a public hearing to review and finalize the RDA 2016/2017 budget.

 

Legal Counsel Policy Request

Chair and Vice-Chair have requested that a legal counsel policy discussion be added to the October 2016 RDA Board meeting.

 

C.    Written Briefings

 

There were no written briefings.

 

D.    5:36:47 PM Consent

 

1.    Extension of the Closing Date with Central Ninth Development Partners. View Attachment

 

Extension request for the closing date with Central Ninth Development Partners for the row house development at 912 South Jefferson Street, and 916 South Jefferson Street.

 

      2.    Set Public Hearing Date – Second Amendment to the FY 2017 Budget. View Attachment

 

Chairperson Adams said the recommended Public Hearing dates for the second amendment to the 2016-2017 RDA Budget are October 18, 2016 at 2:00 pm and October 25, 2016 at 7:00 pm.

 

Director Penfold made a motion to adopt the consent agenda with the dates for the public hearings as recommended by Chairperson Adams. Director Mendenhall seconded the motion.

Upon roll call Chairperson Adams declared the motion unanimously approved and the consent items were adopted.

 

E.    5:37:35 PM Closed Session

The Board will consider a motion to enter into Closed Session for any purpose allowed under Utah Code 52-4-205.

 

Director Penfold 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 that are privileged. Director Rogers seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved. Chairperson Adams added that the Board meeting would stand adjourned at the conclusion of the closed meeting.

 

The closed meeting of the Board of Directors of the Redevelopment Agency of Salt Lake City was held at the City and County Building, 451 South State Street, in Room 326 at 5:40 PM on Tuesday, September 13, 2016.

 

The following members of the Board of Directors of the Redevelopment Agency of Salt Lake City were present:  Lisa Adams, Chairperson; Derek Kitchen, Vice Chairperson; Stan Penfold, Director; Andrew Johnston, Director; Erin Mendenhall, Director; James Rogers, Director; and Charlie Luke, Director.

 

The following members of the staff of the Redevelopment Agency of Salt Lake City were present: Kort Utley, Senior Project Manager and Crayola Berger, Accountant II.

 

Others present: Lara Fritts, Department of Economic Development; Katie Lewis, Legal Counsel; Jennifer Bruno, City Council Office; Benjamin Luedtke, City Council Office; David Litvack, Deputy Chief of Staff.

 

The Board discussed the acquisition /disposition of real property and attorney client matters that are privileged pursuant to Utah Code.

     

There being no further business, Chairperson Adams called for a motion to exit the closed meeting. Director Penfold made a motion to exit the closed meeting and Director Luke seconded the motion. Upon roll call, Chairperson Adams declared the motion unanimously approved and the closed meeting was adjourned at 5:50 pm.

 

F.    Adjournment

 

There being no further business the meeting was adjourned.

 

This document is not intended to serve as a full transcript as additional discussion may have been held; please refer to the audio or video for entire content.

 

This document along with the digital recording constitute the official minutes of the Redevelopment Agency of Salt Lake City Board of Directors meeting held September 13, 2016.