Community Development Authority Packet - 1/20/2015
CITY OF MUSKEGO
COMMUNITY DEVELOPMENT AUTHORITY
AGENDA
January 20, 2015
6:00 PM
Aldermen’s Room – Upper Level of City Hall,
W182 S8200 Racine Avenue
CALL TO ORDER
PLEDGE OF ALLEGIANCE
ROLL CALL
STATEMENT OF PUBLIC NOTICE
APPROVAL OF THE MINUTES OF SEPTEMBER 16, 2014
PUBLIC INPUT
NEW BUSINESS
1. Commercial Loan Request: Mike Fitzgerald Building (S74 W16834 Janesville Road).
ONGOING BUSINESS
1. Tess Corners Redevelopment District (#1) Implementation.
2. Downtown Redevelopment District (#2) Implementation.
3. Muskego Business Park Redevelopment District (#3) Implementation.
4. Mill Valley Redevelopment District (#4) Implementation.
5. Marketing Plan Implementation.
MISCELLANEOUS BUSINESS AS AUTHORIZED BY LAW
1. Redevelopment District Developments Disc. & Other Miscellaneous Information
Updates
2. Next Meeting Date
ADJOURNMENT
NOTICE
IT IS POSSIBLE THAT MEMBERS OF AND POSSIBLY A QUORUM OF MEMBERS OF OTHER GOVERNMENTAL BODIES OF
THE MUNICIPALITY MAY BE IN ATTENDANCE AT THE ABOVE-STATED MEETING TO GATHER INFORMATION; NO ACTION
WILL BE TAKEN BY ANY GOVERNMENTAL BODY AT THE ABOVE-STATED MEETING OTHER THAN THE GOVERNMENTAL
BODY SPECIFICALLY REFERRED TO ABOVE IN THIS NOTICE.
ALSO, UPON REASONABLE NOTICE, EFFORTS WILL BE MADE TO ACCOMMODATE THE NEEDS OF DISABLED
INDIVIDUALS THROUGH APPROPRIATE AIDS AND SERVICES. FOR ADDITIONAL INFORMATION OR TO REQUEST THIS
SERVICE, CONTACT MUSKEGO COMMUNITY DEVELOPMENT DEPARTMENT, (262) 679-4136.
Unapproved
CITY OF MUSKEGO
COMMUNITY DEVELOPMENT AUTHORITY
MINUTES
September 16, 2014
6:00 PM
Aldermen’s Room – Upper Level of City Hall,
W182 S8200 Racine Avenue
CALL TO ORDER
Chairman LeFebvre called the meeting to order at 6:00 PM.
PLEDGE OF ALLEGIANCE
Those present recited the Pledge of Allegiance.
ROLL CALL
Present: Ald. Hammel, Ald. DiPronio, Commissioners Lefebvre, Johnson Mueller, LeClaire,
Arrowood, and Director Muenkel.
STATEMENT OF PUBLIC NOTICE
The meeting was noticed in accordance with the open meetings laws.
APPROVAL OF THE MINUTES OF THE JULY 15, 2014 MEETING.
Alderman Di Pronio made a motion to approve the minutes of July 15, 2014.
Alderman Hammel seconded.
Motion Passed 7 in favor.
PUBLIC INPUT
OLD BUSINESS
Discuss Commercial Grant/Loan Program Guidelines -
Alderman Hammel made a motion to recommend to Common Council a one year
sunset be placed on the commercial grant and loan programs with a review of the
programs and completion date of the end of June 2015. Lana Arrowood seconded.
Motion Passed 7 in favor.
NEW BUSINESS
ONGOING BUSINESS
Tess Corners Redevelopment District (#1) Implementation -
Downtown Redevelopment District (#2) Implementation -
Alderman Di Pronio made a motion to approve a recommendation to the Council to
pursue friendly condemnation for two Pioneer Drive residential parcels with the CDA
fronting the initial costs. Bonnie Johnson seconded.
Motion Passed 7 in favor.
Muskego Business Park Redevelopment District (#3) Implementation -
Robert LeClaire made a motion to approve staff creating a program for allowing a
50% match for Customer Diversification Assessments. Bob Mueller seconded.
Motion Passed 7 in favor.
Mill Valley Redevelopment District (#4) Implementation -
Marketing Plan Implementation -
MISCELLANEOUS BUSINESS AS AUTHORIZED BY LAW
Redevelopment District Developments Disc. & Other Miscellaneous Information Updates -
Next Meeting Date -
The next meeting will be November 18, 2014.
ADJOURNMENT
Robert LeClaire made a motion to adjourn at 6:56 PM. Bob Mueller seconded.
Motion Passed 7 in favor.
Respectfully submitted,
Kellie McMullen,
Recording Secretary
NEW BUSINESS ITEM #1:
Commercial Loan Request: Mike Fitzgerald Building (S74 W16834 Janesville Road)
STAFF DISCUSSION
Enclosed, please find an application for the Commercial Building & Site Loan Program. The applicant is Mr. Mike
Fitzgerald who owns the structure and property that leases to Twisted Cork located at S74 W16834 Janesville Road on
the NE corner of Parkland drive and Janesville Road. Mr. Fitzgerald requests a loan of $33,300 for his $66,614 worth of
improvements.
The CDA and Common Council adopted the Loan Program at the same time as the Grant Program to provide another
opportunity for financing in the community in order to foster improvement of commercial properties and enhancement of
commercial tax base within the City’s Redevelopment #1 and #2 Districts. As CDA knows, the City does have a
Revolving Loan Fund program already established, but the Commercial Loan Program is a bit less restrictive and looks
to specifically enhance properties close to the City’s downtown.
The Commercial Loan Program is administered the same way as the City’s Revolving Loan Program in that the
Southeast Wisconsin Regional Planning Commission (SEWRPC) is tasked by Muskego to review the initial applications.
Mr. John Meland has reviewed the application for completeness to our adopted program and has presented the
attached memo. Please take time to read this memo that outlines the exact loan terms, collateral, and contingencies.
Staff has also included in the supplement the loan application and some various background info Mr. Fitzgerald
submitted about the business operations on site. Please note that Mr. Fitzgerald did submit his personal financials, to
SEWRPC which are all a part of the needed submittal for a loan. Mr. Meland has reviewed thos e for completeness and
has found that the presented loan package meets the City’s submittal requirements. Staff can have those personal
financial items on hand at the meeting if the CDA desires. If so, a CDA member should contact staff before the meet ing
to let us know that desire as these are kept confidential if at all possible otherwise . Overall, the City and SEWRPC have
found that the loan checks out based on these personal business items submitted.
In all, the submittal discusses a variety of improvements that the loan and supporting equity have already completed
and/or will be completed. The improvements total $34,447.07. Among the improvements supported by the loan and
matching equity are the following improvements:
Add an outside wood deck on the north end of the building for future outdoor seating for Twisted Cork
operations.
Purchase new signage inserts along the facades (complete).
Install a concrete approach to the new dumpster enclosure.
Upgrade approximately 2,600 SF of the parking lot along Parkland Drive.
Add additional landscaping on the Parkland Drive street side of the dumpster and along the northern property
line of the property.
Paving the additional parking lot north of the parcel on the City owned Freedom Square Parking Lot. This item
is complete but was fully paid by the applicant in the form of $32,267 cash in late 2014. The $32,267 is
requested to be used as a portion of the 50% matching cash for the loan. An additional $1,033 in equity would
be needed then to match the $33,300 loan. This would work since Mr. Fitzgerald is showing the need for
$34,447.07 in improvements which is $1,147.07 more than $33,300 50% match needed.
The City of Muskego’s portion of the loan is requested to be structured as a nine year term to match the Twisted Cork
lease, a deferral on principal payments for the first six months to allow the completion of improvements, and an interest
rate of 1.625.
The loan is backed with full matching collateral under a first mortgage position on the subject real estate along with a
personal guarantee from Mike and Jill Fitzgerald. The estimated fair market value on the real estate is in excess of
$351,000.
Staff believes that the submittal meets the purposes set forth in the adopted loan program and recommends a loan
approval of $33,300 subject to Mr. Meland’s comments. While this loan amount is above the city’s $25,000 maximum,
the policy does allow for amounts in excess of $25,000 when the project is to be of importance. The loan proposal will
add more enhancements to a once struggling property and will allow Twisted Cork to continue to enhance their
business presence in this building and along the Janesville Road downtown. Lastly, the loan is fully backed with a first
mortgage on the property. Traditionally, the city has taken a second position on collateral so this loan is very solid in the
event of a default.
The cooperation on this loan package appears to be a win for both the City and Mr. Fitzgerald while allowing the
business of Twisted Cork to continue towards success in Muskego’s downtown.
ONGOING BUSINESS ITEM #1:
Tess Corners Redevelopment District (#1) Implementation
STAFF DISCUSSION
Not much new to report as many of our implementation measures in the Plan have been completed. We will look to
different ways of marketing the vacant parcels along Janesville though this summer.
-Storage Master has received occupancy and has really changed the corner of Tess Corners Drive and Janesville Road
for the better.
-Possible breakfast meeting with Tess Corners Industrial Park owners in conjunction with the Muskego Business Park
owners in near future?
ONGOING BUSINESS ITEM #2:
Downtown Redevelopment District (#2) Implementation
STAFF DISCUSSION
TIF 8 Funds Motivation:
1. Staff is still actively working
with the owners of the
Westwood Centre (Jerome
Drugs building) and Muskego
Liquor regarding loans and
grants we can possibly help
them out with for site/building
updates. As you know, the
Westwood Centre did receive approval for a full update from the City’s Planning Commission just last month. Once
they determine their project costs we should be negotiating with them on how the city can be a partner to realize
that redevelopment.
2. Another opportunity that we have discussed in the past is in
regards to the former Shell Gas Station site. This site is still
privately owned and does have contamination issues like
we saw in the old BP Gas Station parcel across the street.
Staff has been working with the owner and the owner has
indicated that they would sell the parcel to the City of
Muskego if we desired. As indicated, the site is
contaminated but is considered a closed site under the
Wisconsin DNR. Basically, the area of contamination would
have to remain as hard surfaced OR any future
development would have to remediate any soils that are
disturbed during a redevelopment process. Lastly, any
redevelopment would most likely require a vapor intrusion
system (like across the street as well) if developed with a
structure.
Staff has been working with the property owner and also
the owner of Tres Locos. A Wisconsin Economic Development Grant is available for purchase, remediation, and
various private investments. Staff would like to discuss this with the CDA further as this p iece of property is blight in
the new downtown and should be kept on the radar during 2015 as something we pursue.
Pioneer Drive Redevelopment
1. At our last meeting the CDA approved a recommendation to the Council to utilize CDA funds to begin an appraisal
process of two (2) residential parcels along northern Pioneer Drive that adorned the north and south sides of the city
owned utility property. We had found that both owners were willing sellers and were looking to possibly combine
these parcels for a future commercial redevelopment opportunity and spur the historic downtown commercial growth
that we envisioned for the area.
After much discussion the Common Council voted to not proceed with this endeavor. The Council did not want to
assume the initial risk of being a land owner without an end buyer or development at this time.
Not all is lost in an opportunity here though as staff has had some good conversations with the landowners. They
both are still fond of selling if the opportunity presents itself. Fu rther, they had no problem with the city including their
parcels on our sale/lease opportunity list as a possible redevelopment site. Staff has already had a couple
discussions with area developers and is hopeful we can package a redevelopment here still in a more private
scenario.
2. Move forward on a development proposal upon the city lands in front of the Parks Maintenance garage: The CDA
recommended the Council move ahead on these lands. Action has not been taken by the Council regarding these
lands as they are still in the midst of figuring out the Facilities Study priorities which will drive this decision and the
timing.
3. Outreach: Staff would still like to setup a meeting with the owners along the road to gain new ideas and promote
investment. Sometime during 2015 should work for this. Knowing if the city can be a catalyst with the old Parks
Maintenance property would help with such a meeting first.
ONGOING BUSINESS ITEM #3:
Muskego Business Park Redevelopment District (#3) Implementation
STAFF DISCUSSION
-Continuing to work with a few businesses that expressed interest in expansion and financing techniques as a result of
the Business Retention and Expansion Survey.
-One large note that the Customer Diversification Assessment program we adopted has ceased. The UW -Whitewater
offices now no longer offer this for Waukesha County businesses.
-New InPro Office coming along very well.
-Would like to have a very informal breakfast invite meeting with the business owners and tenants this spring if CDA
desires to see what else we might be able to partner in within the confines of the Muskego Business Park. Invite Tess
Corners Park owners as well? Have surveys, etc.?
ONGOING BUSINESS ITEM #4:
Mill Valley Redevelopment District (#4) Implementation
STAFF DISCUSSION
No movement is taking place with the quarry in New Berlin, thus there are no updates at this time from Muskego’s side .
ONGOING BUSINESS ITEM #5:
Marketing Plan Implementation
STAFF DISCUSSION
-We have had a very productive and interesting start to 2015. Many discussions with new businesses looking to make
Muskego a home. Some within a TIF District and others simply looking for downtown space.
-Our online interactive economic development tool continues to be received well and used often for businesses to find
key information about the city and specific properties. We have updated some of the functionality of that tool as it is
being used more.
-Target Industry marketing will pick up here again in spring with more mailers and follow-ups to expanding Illinois
companies.
-A lot of TIF 10 (Moorland Corridor) leverage is taking place. We will be launching a marketing effort wi th over 400
brokers in the SE WI area to really demonstrate the few opportunities we have left along wit h the incentives we can
leverage.
MISC. BUSINESS ITEM #1:
Redevelopment District Development & Other Miscellaneous Information Updates
None.
MISC. BUSINESS ITEM #2:
Next Meeting Date
Tuesday March 17th at 6 pm unless an earlier date is needed for any grant/loan requests.
Approximate CDA Budgets
2011 Budget Existing
Supplies and Expenses $500
Professional Services $3000
Attorney $5000
Property Sale Balance $91,000
Existing
RLF Fund Balance: $300,000+
Existing
RD #3 Balance: $52,248.03
TIF Residual Balance: ~$643,428
TIF 8 Balance: ~$200,000