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HomeMy WebLinkAboutMCRA 2008-05-22 MinutesCity of Miami City Hall 3500 Pan American Drive Miami, FL 33133 www.miamigov.com Di • IN O9▪ IEP 19 1i? Meeting Minutes Thursday, May 22, 2008 10:00 AM (or thereafter) City of Miami City Hall 3500 Pan American Drive Miami, Florida Midtown Community Redevelopment Agency Michelle Spence -Jones, Chair Marc David Sarnoff, Vice Chair Angel Gonzalez, Commissioner Joe Sanchez, Commissioner Tomas Regalado, Commissioner CRA OFFICE ADDRESS: 49 NW 5th ST, SUITE 100, Miami, FL 33128 Phone: (305) 679-6800, Fax: (305) 679-6835 Midtown Community Redevelopment Agency Meeting Minutes May 22, 2008 Present: Commissioner Gonzalez, Commissioner Sanchez, Commissioner Regalado, Chair Spence -Jones and Vice Chair Sarnoff On the 22nd day of May 2008, the Board of Commissioners of the Midtown Community Redevelopment Agency (MCRA) for the Midtown District of the City of Miami met in special session at the City of Miami City Hall, Miami, Florida. The meeting was called to order by Chair Spence -Jones at 10:34 a.m. and was adjourned at 10:54 a.m. ALSO PRESENT: James Villacorta, Interim Executive Director, CRA Gail A. Dotson, Assistant General Counsel, CRA Priscilla A. Thompson, Clerk of the Board Pamela E. Burns, Assistant Clerk of the Board 1. 08-00578 MCRA RESOLUTION A RESOLUTION OF THE MIDTOWN MIAMI COMMUNITY REDEVELOPMENT AGENCY ("CRA"), WITH ATTACHMENT(S), AUTHORIZING THE EXECUTIVE DIRECTOR TO EXECUTE A SECOND AMENDMENT, IN SUBSTANTIALLY THE ATTACHED FORM, TO THE INTERLOCAL AGREEMENT BETWEEN THE CITY OF MIAMI, MIAMI-DADE COUNTY, THE MIDTOWN MIAMI COMMUNITY DEVELOPMENT DISTRICT, AND THE CRA. Legislation.pdf Cover Memo.pdf Motion by Vice Chair Sarnoff, seconded by Commissioner Gonzalez, that this matter be ADOPTED PASSED by the following vote. Votes: Ayes: 5 - Vice Chair Sarnoff, Commissioner Gonzalez, Commissioner Regalado, Chair Spence -Jones and Commissioner Sanchez MCRA-R-08-0001 Direction by Chair Spence -Jones to the Interim Executive Director to work along with the City of Miami Department of Community Development to create a program to provide support and resources to the homeowners and residents in the Wynwood area. Direction by Chair Spence -Jones to the City Manager to instruct the Department of Community Development to work along with the CRA (Community Redevelopment Agency) and Neisen Kasdin to develop a program to provide support and resources to the homeowners and residents in the Wynwood area. Chair Spence -Jones: Yes. I'd like to officially call the Midtown CRA (Community Redevelopment Agency) meeting to order. And I believe we should have the CRA representative here. I see the attorney for the CRA. Where is Jim Villacorta? Commissioner Sanchez: All right. Chair Spence -Jones: Okay. Is Jim Villacorta here? James H. Villacorta (Interim Executive Director, Community Redevelopment Agency): Yes. Chair Spence -Jones: Oh, okay. Didn't see you. Look like Pete over there. Mr. Villacorta: Thanks. City of Miami Page 2 Printed on 7/14/2008 Midtown Community Redevelopment Agency Meeting Minutes May 22, 2008 Chair Spence -Jones: I'd like to officially call the meeting to order. This item on the agenda authorizes the ED (Executive Director) to execute a second agreement -- amendment to the Midtown interlocal agreement. Jim, do you want to go into the details on this issue so we're on the same page, or all the Commissioners have been briefed on it? Mr. Villacorta: I believe all the Commissioners have been briefed or their chiefs of staff. The attached resolution authorizes the execution of a second amendment to the interlocal agreement between the Midtown Community Redevelopment Agency, the CRA, the City of Miami, Miami -Dade County, and the Midtown Miami Community Development District to amend the section of the agreement which required 90 percent of the certificates of occupancy to be in place before the TIF (Tax Increment Fund) payments that are used to retire the bonds on the parking garage are released. Chair Spence -Jones: And the purpose of this is to basically release the tax increment revenue? Mr. Villacorta: Yes. We have accumulated about a million three in tax increment revenue, which are only to be used for the retirement of the parking garage bonds. This would allow that -- those funds to be released at this date. Chair Spence -Jones: All right. Can I get a motion and a second for this resolution, if there's no questions on it? Is there any questions or issues or concerns? Vice Chair Sarnoff I'll do a motion, but only for purposes of discussion. Chair Spence -Jones: Okay. Commissioner Gonzalez: I'll second that motion. Commissioner Sanchez: Second for the purpose of discussion. Chair Spence -Jones: Okay. You're recognized, Mr. -- Commissioner Sarnoff. Vice Chair Sarnoff First, Jim, I want to comment, the next time that the CRA wants Commissioners to read documents, they should be legible, and it is impossible, I'll submit to you, to read schedule 1, even if you had 12-year-old eyes, and most of us are in our thirties, I think. It's just not practical. Now I've learned what it says, but you can't help but expect us to read something that small. Mr. Villacorta: Those were the documents that were submitted to the CRA. We had no input in drafting this. Those were presented to us, and they came before you when you approved that in that same form when you signed on to the interlocal as the City Commission -- Vice Chair Sarnoff Well -- Mr. Villacorta: -- a number of years ago. Vice Chair Sarnoff -- since I wasn't here a number of years ago and since I like to read my documents -- Mr. Villacorta: Sure. Vice Chair Sarnoff -- I'd just as soon be able to read my documents. Mr. Villacorta: Sure. City of Miami Page 3 Printed on 7/14/2008 Midtown Community Redevelopment Agency Meeting Minutes May 22, 2008 Vice Chair Sarnoff. So if it -- Chair Spence -Jones: But can you just --? I'm sorry. Vice Chair Sarnoff -- requires that you go to a photocopier and you make it larger, at least give us the opportunity to read. If we choose not to do it, shame on us. I would suggest to you that it's almost an inopportune way of trying to read something very important. Let me move on, though. You're -- we're being asked to waive the 90 percent requirement, correct? Mr. Villacorta: Yes. Vice Chair Sarnoff Now if we do that and under this particular motion or this particular resolution, that means that at the end, we may have to give back some money under the way it's drafted right now? In other words, they would be paid back in later years? Mr. Villacorta: The agreement also provides that where the TIF is a -- is short of covering the bond payment, the CDD (Community Development District) is required to assess their property owners to make up the difference. In future years, when there are additional funds in excess of the amount required for the bond payment, the CDD will be able to recover the assessments that they assessed themselves when there was a shortfall. Vice Chair Sarnoff Wouldn't a proper quid pro quo be that since we're waiving the 90 percent, that the City be able to keep the later year adjustments? Mr. Villacorta: I believe the thinking here is that the TIF was supposed to pay for those -- the bond payments on the parking garage. If the property owners are making part of that payment during the years when there's a shortfall, they will recover it in the years when there's excess, and they will never exceed the debt of the parking garage, which is what the TIF was put in place for. Vice Chair Sarnoff But -- Mr. Villacorta: That's the sole purpose of the CRA. It does one thing -- when they demonstrate the required number of COs (Certificates of Occupancy), we write a check for the TIF balance up to the amount that is required to make the bond payment. Vice Chair Sarnoff So in this circumstance, you're telling me there's adequate TIF revenue to make payments? Mr. Villacorta: I don't believe there is this year. Vice Chair Sarnoff Right. So my point is they're going to assess themselves, but in the later years, they're asking for the payback. Mr. Villacorta: Yes. Vice Chair Sarnoff Is that something we have to do? I mean, I -- Mr. Villacorta: No. You -- Vice Chair Sarnoff -- agree that they should be given the TIF, and I agree that they should be allowed to have -- not comply with the 90 percent requirement, but why the payback in later years? Mr. Villacorta: The purpose of the TIF was to pay the bonds on the parking garage. To the City of Miami Page 4 Printed on 7/14/2008 Midtown Community Redevelopment Agency Meeting Minutes May 22, 2008 extent that the property owners are making the payment, they're being allowed to recover it. You don't have to amend this agreement at all. That's a policy decision. The COs were not issued in time for them to draw down the debt. They're asking -- the buildings are built; they're not completely CO'd They may have temporary COs. Perhaps -- Vice Chair Sarnoff.- I just want to understand why in the later years we should allow them to get the payback. What's the equitable argument there? Neisen Kasdin: Mr. [sic] Chair, Commissioner Sarnoff, if may. Neisen Kasdin, representing the Midtown Miami Community Development District. First, for the record -- and I'll distribute to you now as well -- the question was asked is there going to be a shortfall this year. I have the adopted CDD budget, and that budget shows that there is not a shortfall because there was a sufficient assessment and contribution by the private parties -- property owners to cover it for this year. In subsequent years, we believe that there will be enough TIF generated, even with slightly less development than was originally anticipated, to cover substantially all, if not all, of the bond payments immediately. Commissioner, with respect to -- I think Mr. Villacorta has expressed the purpose of the agreement was there was a sched -- original financing schedule, which anticipated that so much would be built within such a period of time, would generate so much TIF revenue, and therefore, after a certain period of years, those bond payments would trail off. The fact of the matter is that because of the market conditions in part, it's slightly behind schedule. And so, if we had a crystal ball back then, that payment schedule would have been stretched out sufficient so that the TIF contribution covered the public parking garage bonds. So the intent of it, I think, when all parties entered it, this agreement, was that the TIF would cover the public parking garage bonds. Vice Chair Sarnoff But I just want to get to the later end payment years. Is it your contention that by giving you back the additional TIF, you know, in the later years, that that compensates you for your special assessments now? Is that the quid pro quo? Mr. Kasdin: That -- on a going forward basis, that would compensate the district if there's a shortfall in subsequent years. Vice Chair Sarnoff But if there's -- and you made up the shortfall by a special assessment, correct? Mr. Kasdin: Correct. Vice Chair Sarnoff.- And I'm just trying to understand the later year compensation, and I'm -- Mr. Kasdin: Well, let's -- as a for instance -- now, as you know, there's 2,600,000 feet of both two residential towers, a mixed -use building, 480 thou -- plus 480, 000 feet of retail that have been built. The next retail block has already been approved and is in progress, the JC -- the south block south with the JC Penney anchor. If the original assessments on the schedule show the total value of property -- the total value of the increment to be approximately, I think, 358 million or so that would be generated as of this point in time. The assessments haven't come out for this year, but I think that the County believes it may be in the neighborhood of 320 million, so the increment creation may be about 50 million short of what was originally anticipated. These are rough, rough numbers. So if there is a shortfall not in '08 -- was recovered -- but in '09, then there would have to be an assessment on the private properties, and then if in '010 [sic] or '011 [sic], after the additional buildings are built, the increment is sufficient, then it gets repaid, and that's the way we understand it to operate at this point -- from this point forward So -- and I would say, as I think you -- all members of the Commission are aware, although the goals were slightly missed, they were really only slightly missed. I mean, you still have -- this is one of the most successful infill urban redevelopment projects in the United States, and generating probably over 1,500 jobs for vast majority City of Miami residents, with two residential towers City of Miami Page 5 Printed on 7/14/2008 Midtown Community Redevelopment Agency Meeting Minutes May 22, 2008 completed; the mixed -use tower, the retail, the 3, 000 plus public parking spaces and the public plaza. So it's a tremendous accomplishment. So, yes, that's how it would work, Commissioner, if that answers your question. Vice Chair Sarnoff Okay. Commissioner Sanchez: Vice Chair. I mean -- I'm sorry. Chair Spence -Jones: Does it -- do we have any other -- that's okay -- comments from the Board? You -- I'd like to recognized Sanchez. Commissioner Sanchez: That -- I think that was the question that we all had, you know. We wanted to make sure that was clearly defined as to what would have been -- if there would have been a shortfall and insufficient amount on the annual debt service of the bond 'cause that's a concern that we have. I want to focus on one thing that you said and that is the value that has been created in Midtown. You stated a number around $320 million. I tend to look at things on a positive aspect. When you have been able -- or we have been able to provide jobs to close to 1,000 individuals in our City, and I would say about 80 percent of those individuals live -- Mr. Kasdin: In the City of Miami. Commissioner Sanchez: -- within the City. Mr. Kasdin: And the vast majority of those within the surrounding neighborhoods of -- Commissioner Sanchez: Allapattah -- Mr. Kasdin: -- Allapattah, Wynwood -- Commissioner Sanchez: -- Wynwood -- Mr. Kasdin: -- Little Haiti -- Commissioner Sanchez: -- Little Havana. Mr. Kasdin: -- Overtown, Edgewater. Commissioner Sanchez: So it is a great development. Mr. Kasdin: Thank you. Commissioner Sanchez: It was a great project. Although it fell short -- we don't have a crystal ball as to what the future may bring, but I think we went into a partnership with you and the CRA on this to make sure that we get that project done. Now there's one issue of affordable housing that was discussed, and that was that, of course, we did not get the 108 HUD (Department of Housing and Urban Development) loan, but still, there was a voluntarily -- Mr. Kasdin: Yes. There's a volun -- Commissioner Sanchez: -- pledge of housing. Mr. Kasdin: -- tary pledge that the Midtown Equities folks -- those are the people on the residential side -- have presented to the City through the Mayor in which they are willing to commit to making payments according to that towards affordable housing benefits. I would also -- I would mention, Commissioner, as you brought up, the affordable housing commitment was City of Miami Page 6 Printed on 7/14/2008 Midtown Community Redevelopment Agency Meeting Minutes May 22, 2008 tied to a Section 108 loan which was never received. Commissioner Sanchez: Which never received. Mr. Kasdin: Right. Commissioner Sanchez: So basically, you're -- this is -- you're volunteering this. Mr. Kasdin: Yes. Midtown Equities is volunteering this. And these payments -- they would be making payments equivalent to what the carrying costs would have been on that million -dollar line of credit. That is their absolute offer to the City of Miami. I'm authorized to convey that. In addition, they have provided statistics in terms of the number of units that have been sold, many of which are well within the workforce -- perhaps, some -- I don't want to overstate it -- but perhaps, some even within affordable, but certainly, many within the workforce housing range. Chair Sanchez: All right. Mr. Kasdin: And I would be happy to share with the Commission the tender that was made by Midtown Equities, and I'll distribute that now. That is an absolute, bona fide offer of assistance on their part. Vice Chair Sarnoff Do you know what the value of that is? Mr. Kasdin: I believe, Commissioner, it is on the order of a quarter of a million dollars, and to just summarize, ifI may, it would be an initial cash contribution of $80, 000 to support the construction and rehabilitation of housing within the Wynwood area. The initial cash contribution is equivalent to the estimated debt service that would have been paid by the development company on the one million line of credit envisioned as a requirement of the Section 108 loan. Additionally, as evidence of its desire to support the continued revitalization of Wynwood as a corporate partner, BDP, that's Biscayne Development Partners, would provide future contributions of $25, 000 per completed residential building at the Shops at Midtown Miami. The net present value of this is two hundred -- is estimated at $211,000. They would also work -- the BDP's contribution could serve as a match to the targeted recurring appropriations by the City for the advancement of the City's single-family rehabilitation and single-family replacement programs administered by the Department of Community Development within the Wynwood area. BDB [sic] funding could be used as equity contribution that would lessen the amount of City provided debt homeowners would have to incur as a result of their participation. And BDP commits to jointly work to solicit assistance of other corporate partners to expand the pool of available resources and the programs impact. And they would also work in partnership with neighborhood housing services or Habitat for Humanity or LISC (Local Initiative Support Corporation) to leverage their contribution within the area. And I will pass this out. This is the official tender and offer from BDP in this regard. Vice Chair Sarnoff Let me mod my motion, and I hope the seconder accepts it, that in reliance upon the representations made of BDP and their stat sheet that they're providing to the City Attorney, that my motion would be to approve this -- Chair Spence -Jones: Okay, so we're -- Vice Chair Sarnoff -- relying upon their representation. Chair Spence -Jones: Madam Clerk, so he's act -- you're amending your motion? Priscilla A. Thompson (Clerk of the Board): Yes. But the question becomes, does that amendment change your resolution? City of Miami Page 7 Printed on 7/14/2008 Midtown Community Redevelopment Agency Meeting Minutes May 22, 2008 Chair Spence -Jones: Jim. Gail A. Dotson (Assistant General Counsel): The amendment does not change the resolution because it doesn't change the material intent of the resolution. Ms. Thompson: Thank you. Ms. Dotson: Okay. Commissioner Sanchez: I would second it. Chair Spence -Jones: Okay. All in favor on the item? The Commissioners (Collectively): Aye. Chair Spence -Jones: I just have a comment before we close out. Mr. Kasdin: Yes, Commissioner. Chair Spence -Jones: Basically, based -- you kind of put on the record today -- and I just want to be clear. That's what I asked the ED regarding your statement today. There's about $211, 000 that can be made available? Mr. Kasdin: Eighty thousand immediately; over the life of the development, reduced to a present value, $211,000. Chair Spence -Jones: Okay. Mr. Kasdin: Twenty-five thousand per additional -- Chair Spence -Jones: But right now -- Mr. Kasdin: -- building. Chair Spence -Jones: -- if there's rehab projects or -- Mr. Kasdin: Yes. Chair Spence -Jones: -- things like that in the Wynwood area -- 'cause both myself and Commissioner Sarnoff represent that particular community, and I know that there's been some back -off in the past or just some ill feelings, you know, with many -- well, not many, but some of the residents in the Wynwood area, so anything that we can do to show that we're making some sort of effort to provide support to the homeowners in that area, I'd like to at least see the CRA put some sort of program together, along with our CD -- Community Development Department to at least make some of those resources available. Mr. Kasdin: Absolutely. And that, Commissioner, is why they're making this offer today -- Chair Spence -Jones: Okay. Mr. Kasdin: -- which is bona fide. Chair Spence -Jones: All right. So I'd like to -- City of Miami Page 8 Printed on 7/14/2008 Midtown Community Redevelopment Agency Meeting Minutes May 22, 2008 Mr. Kasdin: Thank you. Chair Spence -Jones: -- direct the ED to at least work along with you guys to put together some sort of program that could be made available for the Wynwood residents. Mr. Villacorta: Okay. The problem is the CRA boundaries are limited to the boundaries of the Midtown development. Chair Spence -Jones: Okay, so -- Mr. Villacorta: We can't go outside, but we can make sure that the City and the developer work together -- Chair Spence -Jones: Okay. Mr. Villacorta: -- but we can't set foot across that sidewalk. Chair Spence -Jones: Okay. Mr. Villacorta: If I could also point out that the City, under this amendment, will be repaid for the cost of setting up and operating the CRA for these last few years, approximately $80, 000 will be taken first out of the TIF revenues to reimburse the City. And perhaps Mr. Kasdin can clam -- I know it's been a concern of some Commissioners -- that in the invent the TIF is not enough to make the payments on the bond they must assess themselves and -- the balance, and there is no liability flowing back to the CRA. Mr. Kasdin: That's correct. There is none. Chair Spence -Jones: Okay. No problem. We're going to officially close out on the meeting, but I -- since we can't, the CRA, participate, I'm going to ask George -- I see our C -- Community Development Department -- to work along with CRA and with your office to develop that program. Mr. Kasdin: Thank you, Madam Chair. And on behalf of the property owners there, as well, I'd like to, again, thank the City -- this entire redevelopment project would not have happened without the leadership of the City of Miami. Thank you. Chair Spence -Jones: Thank you, Mr. Kasdin. Commissioner Sanchez: Motion to adjourn the CRA. Commissioner Gonzalez: Move it. Commissioner Sanchez: When you're done. Mr. Villacorta: Have we voted? Commissioner Sanchez: When you're done. Chair Spence -Jones: I'd like to officially adjourn the CRA meeting. Thank you, Mr. Chairman, to turn it back over to the Chairman. City of Miami Page 9 Printed on 7/14/2008