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Commuinity Development Authority- MINUTES - 4/13/2005 CITY OF MUSKEGO Approved 5/2/05 COMMUNITY DEVELOPMENT AUTHORITY (CDA) Audio recording of meeting MINUTES is also available. Monday, April 13, 2005 Chairman Frank Waltz called the meeting of the Community Development Authority to order at 7:01 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, Suzi Link, Frank Waltz, Ald. Nancy Salentine, Ald. Schroeder and Executive Director Jeff Muenkel. ABSENT: Commissioner David Lidbury (excused), Commissioner Gail Miles (excused) GUEST: Muskego Sun Reporter APPROVAL OF MINUTES March 7, 2005 Ald. Salentine moved to accept the minutes for the March 7, 2005 meeting of the CDA. Commissioner Glazier seconded. Upon a voice vote, the motion carried unanimously. OLD BUSINESS Review and Update of RLF Loan Procedures/Promotional Efforts Executive Director Muenkel said the brochures were sent out to a couple hundred commercial businesses and banks. They have received a couple of phones calls everyday for additional information. Some have taken the second step and talked with the representative at South East Wisconsin Regional Plan Commission (SEWRPC). They may be at the next CDA meeting in May. As discussed at a previous meeting, changes have been made to the draft of the RLF Policies and Procedures Manual. He reviewed them with the CDA members as follows: Change 1- Loan Application Fee: The current loan application fee is 1% of the RLF loan amount with a $50 minimum and an $800 maximum. This is a bit high and other communities use 0.5% of the RLF loan amount with a $50 minimum and an $500 maximum. Change 2- Loan Origination Fees: The current loan origination fee is $250 or 1% of the RLF loan amount. This also is a bit high and other communities use $150 or 0.5% of the RLF loan amount. In addition, the City currently requires the applicant to pay all the attorney fees and most other communities only require that 50% of the attorney fees be paid. CDA Minutes April 13, 2005 - page 2 Change 3- Loan Amount: Currently, loans can only be applied for between $20,000 to $100,000. Although there is a provision to allow loans in excess of $100,000 on a case-by-case basis. Other cities also state that loans for less than $20,000 can be allowed on a case-by-case basis to. Staff suggests implementing language to allow the same. Change 4- Interest Rate: The current interest rate shall range from a minimum of 4 percent to a maximum of the prime rate of interest plus 200 basis points as published in the Midwest Edition of the Wall Street Journal (approximately 4-7.5%). Most other cities have the current interest rate ranging from 50% of the prime rate as published in the Midwest Edition of the Wall Street Journal or 4 percent, whichever is less (approximately 4% or less). This is a large recommended change, as without it, developers are getting closer or lower rates already these days. He mentioned that the biggest change was the interest rate. Right now interest rates are low. Having this low interest rate is an incentive to use the fund. Commissioner Link stated that the interest rates are going to be going back up. Having essentially a 4% cap on the interest rate going out into the future, she did not think was prudent. If the CDA is going to do a change like this, the 4% interest rate should be only for a set period of time and then have it reviewed. Otherwise, people will expect they are getting a 4% maximum interest rate and not be aware that the CDA can change it. She thought the 4% rate was too generous. She stated the RLF should eventually come back to the seed money. Executive Director Muenkel said that was correct. The only way the fund could be replenished would be by the rate of interest. If the interest rate was too low, the fund could eventually go away. He thought, too, that the interest rate could be reviewed annually. Chairman Waltz recognized the seed money was grant money from the State to stimulate economic development. To have a place where people could get low interest to help them get started in business. It does have to revolve or eventually the grant money would be gone. Ald. Schroeder recommended putting a statement in the RLF information that the interest rate is reviewed on an annual basis. There could be a point in time where the CDA could be losing money. The statement needs to be in the information so everyone knows up front it will be reviewed on an annual basis. If they are in the process, the CDA could take that into consideration. Commissioner Glazer also agreed that it should be low to create the incentive, but state that the interest rate can be reviewed annually. Ald. Salentine agreed with having the statement in the RLF literature. Commissioner Link mentioned that you could have some default on the loans and there would be no other place to make up the money. Commissioner Link moved to accept the proposed changes as outlined in the supplement with the addition of the annual review of the interest rate. Ald. Schroeder seconded. Executive Director Muenkel will take it to the Wisconsin Department of Commerce for approval. Upon a voice vote, the motion carried unanimously. Update on City-owned Janesville Road Property and RFP (Request for Proposal) Executive Director Muenkel informed the CDA members that the Mayor and he did meet with the surrounding property owners. Most of them would sell at the proper price and some with contingencies as they currently have businesses. He approached the Common Council. The final decision has not been made due to changes in the Mayor’s office. They plan to go with one more closed session at the Common Council. In the meantime, Executive Director Muenkel will continue to get an RFP together, almost finalized. He will put it together with the Janesville Road property only and then add an addendum stating that there are opportunities next to it and possibly getting letters from those property owners stating that they would like to be included and they know that CDA Minutes April 13, 2005 - page 3 this opportunity is coming up and they want the developer to contact them. If the developers can get land contracts with the surrounding property owners, then they can include that in their concepts. There is the possibility the city could buy the properties, but we should plan on moving ahead with the RFP in the event it doesn’t happen. He will get a solid draft and email it to everyone to review and to make their comments at the following meeting. At the next meeting, he should know the status of whether or not the city will be buying the properties. Chairman Waltz asked if any other government entity had to approve the RFP? Executive Director Muenkel said since the CDA was given development rights, they could move ahead with this. The document, of course, would be reviewed by the CDA’s attorney prior to publishing. NEW BUSINESS Executive Director Muenkel said that the building, site and operation plans were coming before the CDA because the policies and procedures were changed and approved by the Common Council that any type of development in a redevelopment district could be reviewed by the CDA for their recommendations. Chairman Waltz summed up that the CDA is an advisory group with no authority beyond their recommendations. Approval of a Building, Site, and Operation Plan for a Retail Convenience Center for a property located in the NE ¼ of Section 10 (Tax Key Nos. 2198.990.001 and 2198.985.062). Chairman Waltz stated this property is located on the southwest corner of Janesville Road and Parkland Drive. Executive Director Muenkel went over the facts of the plan as submitted. The plan will not be going before the Plan Commission until a later date. He had met with the developer and recommended some changes that should be made before it goes before the Plan Commission. These changes were shared with the CDA members. He will relay the CDA comments to the developer and quite possibly bring back a new plan at the next meeting. It’s a new convenience center proposed for the vacant site. The redevelopment plan shows it as one of the blighted properties due to it being vacant. It is written up in Phase IV of the redevelopment plan. In reviewing the renderings, Commissioner Link stated it looked like a strip mall. A strip mall is not what the CDA wants to see in the downtown area. Also they did not want to be looking at a whole lot of parking lots from the street. This plan is parking on the street side and the building up hill. She suggested moving the building closer to the street with possibly one row of parking in front of the building and the rest of the parking behind the building. The CDA had developed a plan with the community on what they want the downtown to look like and they should try and abide by that plan. Commissioner Glazier understood that the CDA role was advisory but what he saw was another strip mall. He saw design elements in the site plan that the CDA would not have allowed across the street, in particular, the parking by the street. Ald. Salentine stated that the CDA wanted a walk-able downtown. Commissioner Glazier said the CDA had talked about varied rooflines and staggered storefronts and he did not see that in this plan. He could not see the first development in the area not comply with the CDA’s design. He asked if the tenancy was known? Executive Director Muenkel did not know. They do want to build relatively soon so they must have tenants lined up. Chairman Waltz’s comments were similar to Commissioner Glazier’s. His first reaction was wonderful; somebody’s stepping forth to do something with one of the properties the CDA had targeted. However, in comparing it with the concepts of what the CDA wants the downtown to look like, it doesn’t match the vision. It’s virtually a carbon copy of the Muskego Centre. One of the things in the redevelopment plan was green space, pedestrian friendly, etc. Some of the islands need to be converted to greenery. Executive Director Muenkel stated there would be a landscape CDA Minutes April 13, 2005 - page 4 plan brought forward. Chairman Waltz would like the developer to make some changes more in line with the spirit of the downtown redevelopment concept. Commissioner Link wanted to know if the developer had seen the plan? Executive Director Muenkel responded they had. He noted that this is Phase IV and Phase IV was suppose to complement uses of Phase I, but Phase I does not exist. Ald. Schroeder commented that this developer has a difficult job because Phase I is not there to use as a comparison. He thought the CDA should give the developer some leeway in trying to integrate the plan. They should look at the redevelopment plan as a guide and not a mandate as they haven’t set the tone yet. There is not an example that has been built in Muskego. Commissioner Glazier said the developer doesn’t have the benefit of the conversations that the CDA had with the property owner across the street on some of these issues. He thought the guidelines were vague enough to allow a lot of different kinds of development. He did not want to put a burden on the developer either as he would like to see the property get developed. Ald. Schroeder’s point for the staff was the need to go the extra mile with this developer because it is a beginning. To help it along, to get it to where the CDA’s vision is there. Commissioner Link agreed that if they have a willing developer, to go with it. However, there were some things that were really voiced by the community and the CDA has been in the position of having to defend those things, and suddenly, because it is a smaller project than across the street, to not apply the same criteria? But, absolutely, do anything the CDA can to help expedite and minimize the difficulty in getting to that point. Ald. Schroeder mentioned that the developer, with at least 11 different establishments, was almost mandated for that much parking. Then, the guide indicates they weren’t looking for that size of building and then you would not have that much parking and more green. Commissioner Link thought if they reversed the building with the front looking out over the green space, this would be a more attractive storefront. Ald. Schroeder said then they would be mandated to have brick all around the building. Executive Director Muenkel stated the building elevation would be changed and they would be adding some brick pillars. It would be split-face rock on the bottom layer of the front elevation and this also incorporated all on the back. The roofline would also be incorporated. Chairman Waltz thought, in regard to the repetitive and monotonous frontage on the building, if there was something the developer could do within practical reason from a business standpoint to improve it. Executive Director Muenkel advised that in the redevelopment plan in Phase I, the language stated “the development may include other elements not listed or may exclude some of the elements listed below as any new development should be market driven.” The developer may come back indicating that with all the changes of roofline, character, parking, that it is not marketable. He wasn’t sure what direction it would go. Chairman Waltz read Commissioner Lidbury’s written comments. Basically, they had to do with the character and appearance of the building and he had higher expectations. Commissioner Glazier said if the developer looks at the design guide and vision forum pictures, there may be something they can still do with the elevation and have the parking out front that they need and come closer to what the CDA wants. Ald. Schroeder referred to Bushy’s and the limousine service and it is evident the Plan Commission takes the CDA’s comments very seriously as it strengthens their position. Commissioner Link pointed out that since one of the properties was determined to be blighted, they would be eligible for TID funds. Ald. Schroeder asked if there were any changes in the infrastructure? Executive Director Muenkel said the infrastructure is available at the property lines. Commissioner Link asked about the storm water plan? Executive Director Muenkel said they would be buying into the city’s. Ald. Schroeder asked if they would need to go to the county for approval? Executive Director Muenkel said the accesses are on the city road and he had not received any additional input from the engineering department. He will bring back new plans at a later meeting. CDA Minutes April 13, 2005 - page 5 Approval of an amendment to a Building, Site, and Operation Plan for Marathon Gas Station located in the SE ¼ of Section 9 (Tax Key No. 2193.070). Chairman Waltz shared Commissioner Lidbury’s question if they were approving something that would be torn down in five years? Executive Director Muenkel stated that the parcel is on the corner of Lannon and Janesville and is non-conforming. The ultimate right-of-way runs through where the plan shows concrete islands and new pump. If the county were to go ahead with the reconstruction of Janesville Road, the county would buy some of this property. The site currently has dilapidated asphalt, no enclosure for refuse, no definable landscaping, and no markings for parking. The owners plan to enhance the site by updating the buildings, landscaping, adding a refuse enclosure and define the parking. One issue is the proposed outdoor display shown between the pumps. They haven’t defined what it consists of and keeping it cohesive with the environment, they usually recommend against it unless a specific event or time frame. Chairman Waltz said they are making some cosmetic improvements to the building with the windows, the covering and the layout inside, upgrading it. The island is staying where it is, just putting new pumps on it. Ald. Schroeder liked it, but his only concern is that they allow them not to quite go to the standard the CDA wants in that area and then somehow someway they’re able not only to go the five years or ten years, but they are able to configure at a later point in time to continue the operation with the building the CDA thought would only be temporary and not what the CDA had in mind as a standard for the redevelopment district. Executive Director Muenkel did not think that applied to this. The elevations presented and the way they are changing the building and the materials they are using, it will last for the long run. If the Janesville Road reconstruction goes through in five years, in ten years, it is likely the overhang will be removed and if they could still stay on the lot, they may redevelop the whole site. Commissioner Glazier thought it was a remarkable upgrade of the parcel and once the county comes through with the road project, something will have to be done differently. At least, there is a great upgrade in the short term. Commission Glazier made the motion to approve the remodeling as presented. Ald. Salentine seconded. Ald. Schroeder recommended changing the location of the dumpster enclosure closer to the side of the road so the area would be more appealing for a restaurant and cross access and put parking spots in the previous location of the dumpster. Commissioner Glazier amended his motion to include changing the location of the dumpster enclosure closer to the roadside and put parking spots in the previous location of the dumpster. Ald. Salentine seconded the amendment. Upon a voice vote, the amendment was accepted. Upon a voice vote, the main motion carried unanimously. Public Input: None MISCELLANEOUS BUSINESS AS AUTHORIZED BY LAW: The next meeting was scheduled for Monday, May 2. ADJOURNMENT: There being no further business, Commissioner Link moved for adjournment, seconded by Commissioner Glazier. Upon a voice vote, the motion carried. Meeting adjourned at 8:11 p.m. Stella Dunahee, CPS Recording Secretary