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Commuinity Development Authority - MINUTES - 7/16/2003 CITY OF MUSKEGO APPROVED, AS AMENDED 8/13/03 COMMUNITY DEVELOPMENT AUTHORITY (CDA) MINUTES Wednesday, July 16, 2003 CDA Chairman Frank Waltz called the regular meeting of the Community Development Authority to order at 7:00 P.M. Those in attendance recited the Pledge of Allegiance. The meeting was posted in accordance with the Open Meeting Law. PRESENT: Commissioners Rob Glazier, David Lidbury, Suzi Link (7:02 p.m.), Frank Waltz, Ald. Rick Petfalski and Ald. Nancy Salentine Also in attendance Finance Director Dawn Gunderson, Plan Director Brian Turk, Attorney James Baxter III, and Vandewalle & Associates Representative Greg Flisram ABSENT: Commissioner Gail Miles (excused) GUESTS: Mr. Art Dyer, Mr. Richard Knudsen APPROVAL OF MINUTES: Ald. Nancy Salentine moved to approve the minutes of the joint meeting of the CDA and the Common Council of June 10, 2003. Ald. Petfalski seconded. No further discussion. Upon a voice vote, the motion carried unanimously. OLD BUSINESS: REVOLVING LOAN FUND Commissioners reviewed the May 30, 2003 draft of the policies and procedures for the Revolving Loan Fund. The draft incorporated some modifications received from the State Department of Commerce. Chairman Waltz refreshed the members that the Common Council is turning over the maintenance and operation of the fund to the CDA. Director Turk commented that the Common Council still makes the final decision, with the CDA functioning as a loan board. Commissioner Glazier asked with the CDA overseeing the development district, what happens if some other business in the city approaches the CDA for a loan and they are not in the redevelopment district? Director Turk replied they could be any where in the city. Commissioner Lidbury noted that on page 16, section 8.2.01.1, the amount in ( ) should be $500.00. NEW BUSINESS: DISCUSSION WITH LEGAL COUNSEL REGARDING CDA POWERS AND PROCEDURES CDA Minutes, July 16, 2003, page 2 Director Turk opened the discussion by commenting that at previous meetings the procedure for moving ahead with the redevelopment of district 2, specifically the Parkland Mall site, had been discussed. He pointed out that the next agenda item was for Vandewalle & Associates to prepare developer requests for proposals. The idea being that the CDA would release this to the development community, including the current owner, to entertain development proposals for the site. The CDA would interview the developers and review the proposals and select the one most suitable. As that may involve a condemnation process if the current owner is not selected as the developer, Attorney Baxter was here to discuss the process and procedures for condemnation. Chairman Waltz asked if there were guidelines for sending out the proposals and for receiving the proposals? Attorney Baxter did not think there was anything formally in the statutes. Ald. Petfalski questioned what the criteria was for scoring the proposals? Director Turk stated they did not have anything yet and that Vandewalle would help with the criteria. Ald. Salentine inquired what the timeline was for submitting the proposals? Mr. Flisram said that would be for the CDA to determine, but recommended giving more time rather than less time. He explained briefly RFPs (Request for Proposals). Getting back to the subject of condemnation, Commissioner Lidbury Glazier asked if a body such as the CDA had ever been challenged in court in terms of condemnation of private citizens property? The authority to do a condemnation in general? Attorney Baxter said the statute clearly designates that authority to the CDA. Any particular condemnation can be challenged on a case- by-case basis. In order to challenge the authority, they would have to challenging the validity of the statute itself. Under Section 66.1333, the redevelopment statute, directs you to Chapter 32, which is the condemnation chapter. You have to follow the procedure clearly in the statute and if not, then there is a procedural defect in the condemnation. Beyond that, there are other grounds potentially for challenging, if for some reason, the project is not likely to come to fruition, the condemnation can be challenged. Also, the amount of money can be challenged. There may be a great difference between the municipality’s appraisal and the property owner’s appraisal. Chairman Waltz inquired if there would be any challenge to the selection of a developer’s proposal? Attorney Baxter stated this would be outside any statutory procedure. He asked what process the CDA was envisioning for the property? Director Turk said they needed to work out the timeline when the CDA notifies the owner and start the process. Commissioner Link said the CDA needed to decide what to deal with first. Do they deal with the bids and select a developer and then secure the property; or do the condemnation proceeding first? Mr. Flisram said the developer would not be interested in the property unless it was owned by the city. Ald. Salentine asked when they should start? Attorney Baxter stated they need to make a decision up front whether they are going to proceed with condemnation and he assumed that was premised on the thought that the current owner is not going to be doing what the CDA would like done with the property. Chairman Waltz said the property owner hasn’t to date, but that did not preclude him from submitting a successful plan with financing. Attorney Baxter stated with the situation, you would want to find out if the owner is going to do with the property what CDA wants done in the time frame that the CDA wants it done; if not, the CDA acquires the property and when they have acquired the property, then seek proposals for development. Chairman Waltz asked what the procedure would be for finding out his intent? Attorney Baxter indicated to ask the owner his intent, is he going to develop it? If so, how? If so, when? and tell the CDA promptly. If he is not going forward in a satisfactory fashion, then the CDA is going to acquire the property. At this time, Commissioner Link inquired if the courtesy letter had ever gone out to the property owner? CDA Minutes, July 16, 2003, page 3 Director Turk could not say. Commissioner Link said the CDA needs to notify the property owner in writing and appropriately remind him of the desire of the community for the development of that property and asked if he intends to do something along those lines, and if so, what? If not, how he would like to proceed? The CDA needed something in writing to the property owner and a written response from the owner. The letter would be from the CDA and go out under the CDA Chairman Waltz’s signature. Director Turk would draft the letter tomorrow. Ald. Petfalski inquired of Mr. Flisram if they had ever done any RFPs where the condemning party had not owned the property? Mr. Flisram stated no. Ald. Salentine asked what is step 1 to get this in motion? Attorney Baxter gave a brief rundown on the condemnation procedure. They have a choice because the condemnation is for redevelopment purposes. They can proceed in either of two alternate procedures. The so-called “quick take” and the so-called “slow take.” “Quick take” basically is paying just compensation relatively up front, you take title, and the landowner has two years to challenge the amount of the compensation. If he waits the full two years, a year and a half to three years after that, three and a half to five years out, you will find out how much the property really costs. In effect, you are writing a blank check, but you get the property right up front. “Slow take,” you fight about the fair market value up front and then you decide whether you are going to proceed with condemnation. You don’t get the property as fast, but you’re not writing a blank check. Commissioner Link interjected and said the third option is to approach the owner of the property and find out if he is interested in developing the property. CDA commissioners decided to write a letter to the property owner to see if he had a proposal for the property. Ald. Petfalski asked if the CDA decided to buy the property, how would they finance it? Finance Director Gunderson said they would finance it similar to the Tess Corners project. Ald. Petfalski asked if the development were successful, where would CDA get the additional money to cover the difference? Finance Director Gunderson indicated possibly borrows the money but she’d have to check on it. Director Turk stated in borrow, you could establish a reserve in case it was needed. Commissioner Link asked if the CDA had the resources to buy the property if he was willing to sell? Attorney Baxter will check but he thought then the property owner would have six months to change his mind on selling to the CDA. Attorney Baxter commented: (1) is he going to develop the property to satisfy the CDA; if so, then they would not be interested in acquiring the property; (2) if the owner is not going to what CDA wants within CDA’s time frame, then the CDA will need to start thinking about acquisition. The first step of the acquisition is either a relocation order or a determination of necessity. Then, the CDA has to get an appraisal of the property and give it to the developer. Then, there is a 60-day window for the owner to get an appraisal at his option. Then, the parties negotiate which is required element in the lead up to a condemnation. If he is willing to sell, then that is as far as the process goes. Commissioner Link said they want to make every effort to contact the property owner first and get his response. Commissioners would like to see a viable plan, financial ability and a time frame. Attorney Baxter asked if the CDA had any idea of what they want in the development? Chairman Waltz advised him that Vandewalle & Associates had prepared a concept design for the property, including architectural sketches, which was presented at an open house and public hearings. Finance Director Gunderson interjected that she had received a call from the property owner today and was asked to be at a meeting with the property owner and Mayor Slocomb on August 8. At this point, Mr. Dyer had arrived. Chairman Waltz asked Mr. Dyer what his intent was for the Parkland Mall property? Mr. Dyer informed the commissioners that he has been in communication with Mayor Slocomb on the plans for the property and has provided plans on the property four weeks ago. He said they would try to break ground this year. He referred to the Vandewalle plan, indicating they are proposing to eliminate the senior housing, the town houses; they are proposing to build two, six-story structures in the back. CDA Minutes, July 16, 2003, page 4 There are about 14 buildings in the Vandewalle plan that are being eliminated. Mr. Dyer stated that they have tenants lined up. Mr. Dyer also stated that the Vandewalle plan is short 50% on parking so it’s not adequate. They redid the Vandewalle plan. He did talk to Vandewalle & Associates about their plan. They didn’t know what the ratios were for density, for parking in the city, and the ordinances and the requirements. They said it was just conceptual. Chairman Waltz asked when the CDA could see his plans? Mr. Dyer offered to get them right away. However, in view of the meeting scheduled for August 8, Chairman Waltz and Director Turk will attend the meeting and look at the plans then. Commissioners would like to see a presentation of the plans at their August 13 regular meeting. Mr. Dyer asked whom he should be talking to regarding his property? Chairman Waltz said the CDA should be apprised of communications. RESOLUTION NO. CDA 008-2003: APPROVING AN AGREEMENT FOR PREPARATION OF DEVELOPER REQUEST FOR PROPOSALS WITH VANDEWALLE & ASSOCIATES Ald. Petfalski moved to defer. Commissioner Lidbury seconded. Commissioner Link thanked Mr. Flisram for coming to the meeting and apologized for the turn of events in the meeting causing this issue to be deferred. Upon a voice vote, the motion carried unanimously. CITIZEN COMMENTARY: Mr. Rich Knudsen asked about the resolution? Chairman Waltz explained the Common Council had, with financial restraints, approved the CDA to enter into an agreement with Vandewalle & Associates to prepare RFPs to be sent to developers. They will look at Mr. Dyer’s plan before proceeding with the agreement. Mr. Knudsen asked about the conversation regarding condemnation? Chairman Waltz said that was if they could not reach an agreement with Mr. Dyer. Mr. Dyer mentioned his conversation with Mayor Slocomb on spending money for RFPs when he had a proposal for development and had already spent $20,000 since their last meeting. Chairman Waltz said as of now they are not since the item was deferred under the present circumstances. Mr. Knudsen asked and received a copy of the Vandewalle plan Project Plan for Redevelopment District #2. MISCELLANEOUS BUSINESS AS AUTHORIZED BY LAW ECONOMIC DEVELOPMENT STRATEGIC PLAN STATUS Director Turk shared that the draft plan has been delivered to the Mayor’s Task Force. They will be reviewing it at their next meeting on Wednesday, July 23, at 5:00 p.m. The Economic Development web page is still under development and should be presented to them within the next two weeks. The Common Council is set to take action on whether or not to impose a moratorium on the Moorland corridor until the plan is finalized and until they can review the zoning code and land use plan to see if any changes are appropriate. CHAMBER OF COMMERCE Ms. Kathy Chiaverotti of the Chamber of Commerce has contacted the people in the Redevelopment Plan #2 and invited them to a meeting to explain the process to them. It is at 7:30 a.m. on July 24 at the Muskego Public Library. Commissioners were invited to attend also. Director Turk will see that the meeting is properly noticed. CDA Minutes, July 16, 2003, page 5 BUSINESS CARDS Chairman Waltz indicated there is a need for CDA to have business cards. Ald. Petfalski will take care of this request. NEXT MEETING: The next meeting is scheduled for Wednesday, August 13, 7:00 p.m., Muskego City Hall. Commissioners will review Mr. Dyer’s plans at this time. ADJOURNMENT: There being no further business, Commissioner Link moved to adjourn. Ald. Petfalski seconded. Upon a voice vote, the motion carried unanimously. Meeting adjourned at 8:12 p.m. Stella Dunahee, CPS Recording Secretary