Idaho Falls Redevelopment Agency

IDAHO FALLS REDEVELOPMENT AGENC Y P.O. BOX 50220 IDAHO FALLS, ID 83405 September 21, 2017 Regular Meeting Minutes Council Chambers Call to Order: Lee Radford called the meeting to order at 12:00. Members Present: Lee Radford, Brent Thompson, Kirk Larsen, Terri Gazdik, Dave Radford, Chris Harvey, Thomas Halley. Members Absent: None. Also Present: Brad Cramer; Meghan Conrad, Legal Counsel; Matt Parke (via telephone for last item); and interested citizens. Modifications to Agenda: None. Minutes: Kirk Larsen moved to approve the minutes of August 17, 2017 Brent Thompson seconded the motion and it passed unanimously. Approval of Bills: Lee Radford presented the finance report dated September 21, 2017. The following bills were presented to be paid from the Snake River Allocation Fund: Elam and Burke, $2,416. 15 for legal services; Rebecca Thompson, $100.00 for transcription of minutes; City of Idaho Falls, $1,152.00 for public notice for annual budget; City of Idaho Falls, $32,460.00 for administrative time from executives Brad Cramer and Kerry Beutler. The following bills were presented to be ratified: TNT Land and Cattle, $151,506.92 for Indian Motorcycle reimbursement. The following bills were presented to be paid from the River Commons Revenue Allocation Fund: City of Idaho Falls, $11,600.00 for administrative time from executives Brad Cramer and Kerry Beutler. The following bill was presented to be paid from the Pancheri /Yellowstone Revenue Allocation Fund: City of Idaho Falls, $2,300.00 for administrative time from executives Brad Cramer and Kerry Beutler. The following bill was presented to be paid from the Jackson Hole Junction Revenue Allocation Fund: Elam and Burke, $6,343.21 for legal services. Brent Thompson moved to approve the Finance Report, Terri Gazdik seconded the motion and it passed unanimously. Reimbursement Request for Deseret Book. Cramer reported that he has reviewed the pay application for the project. Cramer stated that the Grant Agreement approved up to $192,000.00 in rock removal. Cramer stated that the current pad site only required $112,211.00. Cramer indicated that there is another anticipated pad site to be built in the future and the remaining funding could be used for blasting that pad site. Cramer stated that he has informed the applicant that the blasting does have to happen within the life of the District to obtain the funds. Radford clarified and Cramer agreed that they did not develop the second pad. Cramer indicated that they had a potential tenant, but that potential tenant is not interested currently. Brent Thompson moved to approve the reimbursement request and payment of $112,211.00 for the blasting and rock removal of the Desert Book site, Thomas Halley seconded the motion and it passed unanimously. Grant Participation Agreement: Culver’s: Cramer stated that the discussion had been for $125,000 reimbursement for rock removal. Cramer stated that there is a Resolution and Grant Participation 1 Idaho Falls Redevelopment Agency September 21, 2017 Agreement, stipulating that the Agency will participate for $125,000. Cramer stated they need an approval of the Grant Participation Agreement and the Resolution. Lorin Walker. Walker indicted that Culver’s is operating and doing well. Dave Radford asked if this is part of a 75% OPA. Cramer indicated that this Grant will come from cash reserves outside of the 75% OPA. Kirk Larsen moved to approve the Grant Participation Agreement for Culver’s in the sum of $125,00.00, Terri Gazdik seconded the motion and it passed unanimously. Resolution to Approve an Urban Development Plan: Jackson Hole Junction. Matt Morgan. Morgan asked the Agency for the support of Plan Option B that has been prepared by Phil Kushlan and legal counsel. Morgan stated that he has considered Plan B with a 20- year term, and they would like to offer a further compromise to 15-year term for the District. Morgan stated that once the improvements are done and reimbursement has been given, they are willing to end the District sooner than 15 years if completed. Morgan stated that with support of the Agency for Option B they can invest $130 million into the community with private development and public infrastructure development. Morgan indicated that they will bring business to the area with national franchise businesses and it will entice people to visit, live and invest in the community of Idaho Falls and Bonneville County. Morgan stated that the development will allow for development in all directions with the public infrastructure that will be put in place. Morgan indicated that the project will bring new jobs to the area. Morgan stated that the project is complimentary to, and benefits the proposed event center. Shane Flemming. Flemming stated that they remain committed to the project and it will be beneficial to the community. Flemming stated that the economics are tight and to make the project viable they need the support on Option B. Flemming closed by thanking the Board for their consideration. Lee Radford asked for any other comments. Chip Swarzey, CEO of Chamber of Commerce. Swarzey indicated that they are fully behind the project. Swarzey stated that the River block continues to expand south of the City of Idaho Falls, including the stocking of another pond for fishing and that area is becoming an extremely vital part of the Town. Swarzey stated that as they see the Idaho Falls Auditorium District gaining traction and moving forward the southern area along Sunnyside will become vital. Swarzey stated they see over 1 million tourists a year coming up I-15 to Jackson Hole and West Yellowstone and they need to provide support and services to those tourists. Swarzey stated that the hotels are running at 80-90% occupancy in the summer and this project will meet the needs of tourisms and the local community. Swarzey stated that it will create jobs for local people who are leaving the area due to the lack of jobs. Swarzey stated that this project is a win for the community and the Chamber of Commerce is behind this project. Lorin Walker. Walker stated that the development location is key to helping the corridors that IFRA has helped over the years. Walker stated that rather than all the traffic going to the Broadway exit, some can come in the southern door where the project is proposed and will make an excellent detour off the Interstate to bring in tax dollars. Radford asked Meghan Conrad to summarize the characteristics of the two options. Meghan Conrad, Elam and Burke. Conrad stated that they have two options for the Urban Renewal Revenue Allocation area of the Jackson Hole Junction. Conrad stated that the first option is Option A which offers a very narrow scope of improvements and Option B is a much broader scope of 2 Idaho Falls Redevelopment Agency September 21, 2017 improvements. Conrad stated that the improvements under Option A are limited to rock removal with a proposed project cost of $1.75 million which was used in the feasibility analysis. Conrad stated that Option B the scope of projects is closer to $5 million and that number was used in Phil Kushlan’s analysis. Conrad stated that both options are feasible. Conrad stated that this is the first post 2016 urban renewal plan. Conrad went through the changes from the prior plans as follows: Conrad stated that they tried to use fewer words in the Plan and not be as repetitive and more specific going forward. Conrad stated that in the introduction section they made a specific reference to Idaho Code Section 50-2905 that outlines specifically what must be included in an urban renewal plan. Conrad stated because of Legislative changes in 2016 amending an urban renewal plan going forward is limited and there are only 4 exceptions and most would not apply under the circumstances and you would be forced, if you amend the project to add additional projects, to reset the base which would eliminate your revenue stream going forward. Conrad stated that on page 2 in bold they have added that concept. Conrad stated that one of the exceptions for amendment to the plan is for ministerial and technical changes and that is not defined anywhere. Conrad stated that the revenue stream will ebb and flow as the project cost changes over the 20-year life of the plan and so they have tried to set forth in the plan that those types of budgeting efforts or minor discrepancies in the project cost are technical and ministerial. Conrad stated that this could be considered an open land area, and there is no open land definition within the law or the act and the characteristics of defining whether deteriorating conditions exist in open land overlap and Phil Kushlan’s study hit the target in concerns of the eligibility requirement. Conrad stated that in Section 400 this plan is focusing on the City process and most of the provisions therein will refer you back to City Ordinances. Conrad stated that in Section 500 they discuss the revenue allocation financing provisions and in this case the only revenue anticipated to come in is from tax increment funds (TIF). Conrad stated that in Phil Kushlan’s analysis there was anticipated lending amongst the project areas to support administrative costs for the first years of the plan until the TIF starts rolling. Conrad stated that one requirement of a revenue allocation area is the sum of base value for all existing revenue allocation areas cannot exceed 10% of the current assessed value of the plan, and that analysis is on page 13 of Option A and there is no issue and they are not close to the 10%. Conrad stated that there are many affected taxing districts including the County, City of Idaho Falls, School District #91, Bonneville County Ambulance District, Bonneville County Road and Bridge. Conrad stated she is working with Cramer and Beutler to ensure they have defined all taxing Districts therein. Conrad stated that there is a new section 508 that talks about membership dues and supportive community development and that is intended to be clearer in the plan to use the revenue allocation funds to support memberships in things such as the Redevelopment Association of Idaho. Conrad stated that the plan was drafted as a 20-year plan and the duration and termination terms are set forth in section 800. Conrad stated that the boundaries between Option A and Option B are different because of the proposed improvements. Conrad stated that Phil Kushlan’s feasibility shows that either Option A or B is feasible. Dave Radford stated that there was a discussion about 13 years, 15 years and 20 years. Conrad stated that the plan was drafted contemplating the 20-year life of a revenue allocation area, and there are options to terminate early. Conrad stated that they anticipated changes to the Plan and they will go with the Board’s direction and make the change prior to the plan being submitted to the City Council. Dave Radford asked if City Council can select Option A or B. Conrad indicated that they need direction and guidance coming out of the meeting prior to going to City Council. Lee Radford clarified that the draft is 20 years, but the Board could move to change the time frame. Conrad stated that the resolution is drafted to make technical changes. Terri Gazdik asked about the upfront funding until the TIF funds come in, and asked what the estimate could be and the impact it would have on the rest of the funds. Conrad stated that Phil Kushlan’s 3 Idaho Falls Redevelopment Agency September 21, 2017 feasibility study doesn’t constitute a budget. Conrad stated that there will be a few years where the Revenue allocation area will not be generating any TIF and so for purposes of the Financial Feasibility Study Kushlan plugged in a number. Conrad stated that the admin expenses for that period can be taken under consideration in the budgeting process. Cramer stated that they have the option to do budget amendments. Cramer stated that on Eagle Ridge they took a loan from the Snake River Revenue Allocation District and as the TIF dollars came in it paid back the loan to the District. Cramer stated that the Feasibility Study anticipates a similar situation. Cramer stated that the question would be which District to get the loan from and they have not evaluated which District would front the money. Gazdik asked what kind of dollars they are thinking for administrative costs. Cramer stated that the study shows $50,000.00. Lee Radford stated that the number that Kushlan put in doesn’t constitute a budget and $50,000 is likely more than what is needed. Dave Radford stated that $50,000 might not be enough on this project. Cramer stated that the line item in the financial Report covers the entire year as the Agency only pays for the Administrative Costs once a year and that is why the number is big. Cramer stated that the $50,000 would cover multiple years of administration and is not intended to be a loan that covers 1-2 years and would be paid back over years as the increment comes in. Cramer stated that the busiest District is the Snake River District and 1 year of administrative costs totalled $32,000 and that is with a lot of staff dealing with large projects, such as the Broadway, Bonneville, Deseret Book, Culvers, that all had a lot of work. Cramer stated that the administrative cost for this new Plan would be like River Commons or Eagle Ridge as the projects are just getting up and running. Brent Thompson asked Conrad to discuss the criteria for setting up a District and what criteria this area met to qualify. Conrad stated that the plan approval process occurs in 3 separate segments with the eligibility report phase being first. Kushlan went to the area, looked at the site conditions and compared it to the statute and made the finding that the area did qualify for inclusion within a revenue allocation/ project area. Conrad stated that then the report is approved by the Board and City Council. Conrad stated that then City Council directs the Agency to prepare the Urban Renewal Plan and that is where they are in Phase 2. Conrad stated that Kushlan’s report doesn’t get into eligible types of improvements and only talks about what are the deteriorating conditions that are defined in the Statute. Conrad stated that after looking at the area Kushlan found the deterioration of site, and the other elements that he found and listed in his chart. Kushlan stated that having to be specific in the types of improvements they are talking about funding, they look at each type of improvement independently and determine if that is something that can be reimbursed. Conrad stated that it is anticipated that today the Board would act on the urban renewal plan, and that would be submitted to the City Council and Planning and Zoning Commission. Planning and Zoning would ensure that the Plan is in conformance with the Comprehensive Plan. Conrad stated that there is a public notice period of 30 days where it is published in the paper and provide the plan and notice to all affected taxing districts. Conrad stated that there will be a public hearing on the plan. Dave Radford indicated that if 1 criterion is met, the area can qualify for an urban renewal district. Conrad agreed with Dave Radford. Conrad stated that the determination is not made on a parcel by parcel basis and one qualifying parcel can qualify the entire area. Conrad stated that they had more than one qualifying condition in this area. Lee Radford asked for the members of the sub-committee to give a report. Thomas Halley stated that he attended the meeting with the County Commissioners. Halley stated that during the meeting he heard no serious objections from the County on the project. Halley stated that the County has a vested interest in this project. Halley stated that things that benefit the City also revenue 4 Idaho Falls Redevelopment Agency September 21, 2017 wise benefits the County. Halley stated that the County was thankful that the City alerted them upfront about the project. Halley stated that the only way the developer can mitigate his risk and the risk to the project is to bring the timeline in and the developer is willing to move forward on the timeline. Halley stated that the amount is not unreasonable. Halley indicated that the developer is a good well-known developer that has done many good projects, including the City Fire Station. Halley stated that the Sunnyside Corridor is important. Halley stated that Candlewood Suites is at the beginning of the Corridor and it is important to have the whole corridor developed in a qualitative manner. Halley stated that redevelopment talks about open spaces. Halley stated that a car dealership has donated $500,000 of land for an educational park and open space along that area. Halley stated that the City has open spaces and multiple types of development. Halley stated that it is important to continue the quality development all the way to the freeway that fits into what has been done for years. Kirk Larsen stated that it is a great project and the entrance to the City off that exit is a key factor so the project has great value. Larsen stated that they need to be careful when spending tax payer money and so they need to ask the question, “would the project get done without the Agency”. Larsen stated that the goal of the Agency is to participate in an amount that would make it feasible and no more. Larsen stated that another issue is the greenspace and you must make a resolution in your mind of what to do with that. Larsen stated that the two Pioneer Roads in the area will have an impact with the new road that is proposed in the project. Lee Radford stated that the County Commissioners do not want the Agency to pay for what the City will normally pay for. Radford stated that the County doesn’t want the Agency paying for what other developers usually pay for. Radford stated that he understood the County wanted the Agency to remove impediments to development, but not help normal development. Lee Radford indicated that Dave Radford is the vote for the County Commissioners. Dave Radford echoed what Lee Radford stated. Dave Radford stated that he is concerned that the private developer got involved with the traffic study and the City didn’t pay for the entire traffic study. Dave Radford stated that when that happens, there is a certain amount of expectation that if the improvement is made based on the traffic study it could be a shared cost. Dave Radford stated that this Revenue Allocation District will not benefit the County for approximately 15-20 years. Thomas Halley stated that long range planning is the most important plank to quality growth, and the short term is hard at the beginning, and making proper plans with a 20-year plan in the end it’s a gain. Dave Radford stated that this is a valuable project and if it can work and be a win win without being a burden and no special treatment. Lee Radford stated that this is the Idaho Falls Redevelopment Agency, not the Idaho Falls Development Agency. Lee Radford stated that the Agency doesn’t get involved in developing new areas, and they do not finance development. Lee Radford stated that to redevelop there must be a development in the first place. Lee Radford stated that there is a risk of losing focus. Lee Radford stated there are a lot of things that are eligible such as eminent domain and condemnation, but the Agency doesn’t do those as it is not consistent with what the community wants done. Lee Radford stated that any green field part of the County is eligible. Lee Radford stated that he voted that the area was eligible, but the Agency should be focused on being the Redevelopment Agency, and redeveloping blighted areas in the core of the City. Lee Radford stated that by staying focused on the core, the interior parts of the City are better than they have ever been. Lee Radford stated that the Agency has built roads, including Lindsey through broken down area; Utah through junkyards; Riverside Drive through warehouse area; Snake River Drive through a gravel pit; and Memorial through a Downtown area that needed help. Lee Radford stated that there are 5 Idaho Falls Redevelopment Agency September 21, 2017 core areas that need to be incentivized like Northgate Mile, 1st Street, West Broadway, Happyville, Warehouse District. Lee Radford stated that if the Agency stays focused on the core areas the Agency can have a long-term impact on helping tax payers. Lee Radford stated that the TIF is a tool to encourage redevelopment in areas that would be passed over because the cost of redevelopment is higher than developing greenfield, and in redeveloping areas it saves the tax payer money by keeping the infrastructure close and efficient and saves money for both City and County. Lee Radford stated that the question is what should be incentivized and where the money is put sends a sign to the developers about where to develop. Lee Radford stated that if the incentive is provided here, the developers will be told that they don’t need to incur the additional expense for redeveloping, and they can find an outskirt area and say that it’s a gateway. Lee Radford stated that if the money is not provided for this area, it will tell developers to find a redevelopable area to get money. Lee Radford stated that the comment by Lorin Walker relating to the Broadway Exit versus the Sunnyside exit was indicative, and Lee Radford wants people to exit onto Broadway to go to the Downtown area of Idaho Falls. Lee Radford stated that precedent is important to the Agency and if this move is made with funding greenfield development then the Agency will be about developing, not redevelopment. Lee Radford stated that the Agency has been about urban renewal and redevelopment. Lee Radford stated that Joe Groberg, would always ask if the project would move forward without the Agency’s help; and the developer says that this project would not go forward; however, there has been 3 large dealerships develope on the either side of I-15 without any assistance. Lee Radford stated that this is the Redevelopment Agency, not the development Agency. Lee Radford stated that development should pay for development. Brent Thompson stated that he pulled up some State Statutes including Chapter 20, Article 50-208 states “An Urban Renewal Project for an urban renewal area, shall not be planned or initiated unless the local governing body has by resolution determined such an area to be a deteriorated area or a deteriorating area or a combination thereof, and designating such is appropriate of a district.” Thompson stated that the definitions of a deteriorating area talk about things like deteriorating structures, defective streets, faulty layouts, unsanitary conditions, deterioration of site or other improvements, diversity of ownership, tax or special assessment delinquency, defective or unusual conditions of title, etc. Thompson stated that it is difficult to see how those conditions exist, except for the items discussed in Option A, which namely is the presence of lava as a blighting factor. Thompson stated that the items in Option B seem to be more along the lines of development, rather than redevelopment. Kirk Larsen stated that to be fair to other developers, they need to be cautious about how they move forward. Terri Gazdik stated she would question what was approved when they approved the Eagle Ridge District as it is like what is being discussed now, with the same conditions with undeveloped areas and that District was approved, so the flood gates have been opened to look at Greenfield areas. Chris Harvey stated that this is a great project with interest from a great development team. Harvey stated that he shares Lee Radford’s concern with the degree to which they are pulling economic activity outside of what is traditionally the core of the City, and towards areas that are more convenient for the more well to do periphery of the City in that area. Harvey stated that Option A that includes lava rock blasting is something that this Agency has been willing to assist with. Harvey stated that this is a prime location and is something that private development should be able to make it work. Harvey shares Lee Radford’s concern about the focus of the Agency and which areas need reinvestment and redeveloping for the people. Lee Radford stated that there are 3 options: Option A, Option B, do nothing. 6 Idaho Falls Redevelopment Agency September 21, 2017 Thomas Halley moved to approve the Urban Renewal District Plan Option B with a technical change for the time limit of 15 years as presented. Dave Radford asked if there is a blend between A and B. Thomas Halley stated that all of Snake River Landing isn’t dealing with blight. Halley stated that the question of whether the development would have occurred otherwise, and that is subjective area, and that is why there is criteria for eligibility and Candlewood Suites is not the heart of the city, but the heart of the City is vital, if the entrances to the City are vital. Halley stated that it takes risk to develop in areas that have obstacles in the way and this area is not a great greenfield area, and the Agency will be limiting the development that will take place in the area, if they rely on the open market, because of the obstacles that are present. Halley stated that both the Broadway and the Sunnyside exits are important. Halley stated that the Agency has gone into areas in the past that aren’t blighted, because the Agency felt like it was important. Halley stated that he moved for Option B as there is a solid developer, and this will gain more for tax payer money than money sitting in a bank. Halley stated that the developer is taking a lot of risk, and the corridor has multiplicity to it. Halley stated that redevelopment is about development, not an individual business. Halley stated that Mr. Smith, when building his car lot, made an effort to not be in the City and thus would not have been eligible for help from the Agency. Lee Radford asked Halley if he would like to modify his motion. Thomas Halley modified his motion to approve the Urban Renewal District Plan Option B, with the technical change of $4 million cap and a 13-year limit, Dave Radford seconded the motion. Dave Radford stated that the current motion is a compromise that should alleviate the concerns of the Board. Dave Radford stated that the request initially was $4.9 million and they modified it to 15 years. Dave Radford stated that there has been a partnership that has been formed with the traffic study and for the Agency to do nothing is irresponsible. Brent Thompson read the mission of the Agency: “To Strengthen the tax base and promote the successful growth and development of the City of Idaho Falls by using when necessary tax increment financing to facilitate the construction of publicly owned infrastructure . . .” Radford called for vote by roll call: Kirk Larsen, no; Teri Gazdik, yes; Lee Radford, no; Brent Thompson, yes; Thomas Halley, yes; Chris Harvey, yes; Dave Radford, yes. The motion passed 5-2. Lee Radford asked Meghan Conrad to revise the documents according to the modified motion. Meghan Conrad stated that in Phil Kushlan’s attachments he had dollars budgeted out by specific improvements and now that the available money has been reduced by $1 million, how should they adjust the budget. Lee Radford indicated that she should work with the developer to get the right allocation, and that is a technical change that can be worked through. Cramer read the resolution by title. A RESOLUTION OF THE BOARD OF COMMISSIONERS OF THE IDAHO FALLS REDEVELOPMENT AGENCY OF IDAHO FALLS, IDAHO; RECOMENDING AND ADOPTING THE URBAN RENEWAL PLAN FOR THE JACKSON HOLE JUNCTION URBAN RENEWAL PROJECT, WHICH PLAN INCLUDES REVENUE ALLOCATION FINANCING PROVISIONS SUBJECT TO CERTAIN CONDITIONS; AUTHORIZING THE CHAIRMAN OR ADMINISTRATOR 7 Idaho Falls Redevelopment Agency September 21, 2017 AND THE SECRETARY OF THE AGENCY TO TAKE APPROPRIATE ACTION AND PROVIDING FOR THIS RESOULTION TO BE EFFECTIVE UPON ITS PASSAGE AND APPROVAL. Kirk Larsen moved to approve the Resolution, contemplating the technical changes according to the motion, Terri Gazdik seconded the motion. Lee Radford called for roll call vote: Dave Radford, yes; Kirk Larsen, yes; Thomas Halley, yes; Chris Harvey, yes; Brent Thompson, yes; Terri Gazdik, yes; Lee Radford, no. The motion passed 6-1. Cramer indicated that the Grant Agreement for Culver’s had a Resolution associated therewith that was not voted or read. Cramer read the resolution for Culver’s Grant Agreement, by title. A RESOULTION OF THE BOARD OF COMMISSIONERS OF THE IDAHO FALLS REDEVELOPMENT AGENCY OF IDAHO FALLS, IDAHO APPROVING THE GRANT PARTICIPATION AGREEMENT BETWEEN THE AGENCY AND CLOCK TOWER, LLC., AUTHORIZING THE CHAIR, VICE CHAIR, OR EXECUTIVE DIRECTOR TO EXECUTE THE AGREEMENT AND ANY NECESSARY DOCUMENTS SUBJECT TO CERTAIN CONTINGENCIES, AUTHORIZING ANY TECHNICAL CORRECTIONS TO THE AGREEMENT, AND PROVIDING AN EFFECTIVE DATE. Dave Radford moved to approve the Resolution for the Grant Participation Agreement for Culver’s, Brent Thompson seconded the motion and it passed unanimously. Project Update and Request for Assistance for Riverwalk Drive. Jeff Stokes. Stokes stated that the project is close to budget. Stokes stated that the original OPA included 3 different phases: Springhill Suites Public Improvement; Trailside Public Improvements Including Lot 9; and Riverwalk Drive Public Improvements. Stokes stated that the total was $2.8 million, with a maximum reimbursement of $3.3 million. Stokes stated that the budget was based off the original bid numbers from Knife River. Stokes stated that they secured a contract with Knife River for $2.5 million. Stokes stated that at the beginning of the project they realized they had more rock than expected so that created change orders totaling $655,410.00. Stokes stated that they adjusted the contract amount with Knife River to a total of $3.2 million. Stokes stated that they did not ask for additional funds from the Board, as they believed they could work with the contractor and the budget and attempt to absorb the $600,000 that came from change orders. Stokes stated that they are not 100% done, and he is trying to get final change order costs and budget numbers. Radford stated that Cramer has not had a chance to review all the numbers, but it appears that there is an additional $158,308.50. Stokes stated that the rock was the main reason ($429,110) for the budgeting going over the maximum number allowed by the Agency. Dave Radford stated that if the Agency has set a maximum number they need to stick to that number. Lee Radford suggested having Brad Cramer look over the numbers. Dave Radford moved to allow Staff (Brad Cramer) to review the numbers. 8 Idaho Falls Redevelopment Agency September 21, 2017 Stokes asked what he should do, if he should back off the work, or can the Board give him an assurance that there is possibly some money. Brent Thompson stated that the change order added another 60%, and that is a large amount that the assessment was off. Stokes stated that they were all surprised. Thompson stated that he thinks the assessment should have been closer to the true number. Lee Radford asked what work is still going on. Stokes stated that they are closing out the project, the contract and the cost. Lee Radford asked why waiting a month would impact anything that is going on if they are closing out and wrapping up the project. Lee Radford stated that there is not enough information today to move forward and it needs to be pushed till next month. Stokes stated that he is trying to get to the end of this project and close it out. Kirk Larsen seconded the motion and it passed unanimously. Stokes stated that the $655,000 was a huge number that scared them early on, and they went through and worked closely with the staff and City. Stokes stated that they did testing for rock and the holes they tested were in deeper holes than where most of the rock was. Project Update and Discussion: The Broadway (Kelsch). Cramer stated that there are 4 things that need to be discussed, and 3 of them need an action. Cramer stated that the environmental remediation has started. Cramer stated that the DDA states that the DEQ would provide a letter stating that the environmental remediation will take place. Cramer stated that to get the letter from DEQ they must go through a much more expensive and extensive process, than any party is willing to take on. Cramer stated they are proposing to amend the DDA to accept a letter and report from Rocky Mountain Environmental that would be normal for lenders. Cramer stated that there is a resolution amending the DDA to reflect that change. Cramer stated that is accepted by lenders, and the lender working on the project has agreed that is a normal process. Dave Radford moved to approve the resolution, Thomas Halley seconded the motion and it passed unanimously. Cramer stated that item was not listed on the Agenda and so there needs to be a motion to amend the Agenda, and the Resolution needs to be read by title. Dave Radford moved to amend the Agenda to include the Resolution to Approve the amended DDA, Thomas Halley seconded the motion. Cramer stated that for a good faith reason to add that item to the Agenda, this item was discussed yesterday and was not in time for the posting. The Motion passed unanimously. Cramer read the Resolution by title. A RESOLUTION OF THE BORD OF COMMISSIONERS OF THE URBAN RENEWAL AGENCY OF IDAHO FALLS, ALSO KNOWN AS THE IDAHO FALLS REDEVELPMENT AGENCY OF THE CITY OF IDAHO FALLS, IDAHO; APPROVING THE FIRST AMENDMENT TO THE DISPOSITION AND DEVELOPMENT AGREEMENT BETWEEN THE URBAN REWNAL AGENCY OF IDAHO FALLS, AND IF -1, LLC., AND AUTHORIZING THE CHAIR, VICE CHAIR, OR EXECUTIVE DIRECTOR AND SECRETARY, RESPECTIVELY, TO EXECUTE AND ATTEST SAID AGREEMENT SUBJECT TO CERTAIN CONDITIONS AUTHORIZING THE EXECUTIVE 9 Idaho Falls Redevelopment Agency September 21, 2017 DIRECTOR AND SECRETARY TO EXECUTE ALL NECESSARY DOCUMENTS REQUIRED TO IMPLEMENT THE AGREEMENT AND TO MAKE ANY NECESSARY TECHNICAL CHANGES TO THE AGRFEEMENT, SUBJECT OT CERTAIN CONDITIONS AND PROVIDING AN EFFECTIVE DATE. Brent Thompson moved to approve the Resolution, Thomas Halley seconded the motion and it passed unanimously. Cramer stated that the excavation is already going on, and to keep the project moving the DDA requires that the Board approve proceeding with the project, and to say that the costs are what they should be and the Board is ok with starting remediation. Lee Radford asked what is different than the other approvals already given. Matt Parks (via telephone) stated that the initial $100,000 cap had been approved, and this approval is returning to the board for formal approval of the remediation and excavation cost that were under $100,000.00. Parks stated that now they have begun construction and the cost came in under the estimate, is the Board comfortable with Oppenheimers proceeding with construction. Lee Radford recused himself from this action. Brent Thompson will co-chair for this action. Brent Thompson stated that they have not reviewed the Purchase and Sale Agreement, and do not know the guaranteed maximum cost number, and the PSA has just been issued. Thompson stated that Cramer and Oppenheimers will review the costs and come up with the final guaranteed maximum payment, at which time the Agency may call a special meeting if there is time before the regular scheduled meeting to vote. Cramer agreed with Thompson. Cramer stated that the DDA covers the excavation and puts $100,000 max for environmental remediation and then states that even if both parties walk away from the project, the Agency will reimburse the developer for excavation, which is shy of $900,000. Cramer stated that they are asking if the Board is willing to give the formal approval to proceed with the excavation and the PSA will cover the purchase of the work, the garage and the plaza next month. Dave Radford asked Cramer the difference between the $100,000 cap and the $900,000. Cramer stated that the $100,000 is just for environmental remediation of the contaminated soils, and the $900,000 is inclusive of that $100,000 and covers rock blasting, excavation, haul off, to dig the hole for the underground garage, and the foundation and footings. Cramer stated that the goal is to have the work done the day after next month’s meeting, so to keep the schedule moving they need approval today. Brent Thompson asked if a motion is needed beyond the amendment to the DDA. Cramer stated that would be preferred. Thompson asked if the motion is a statement of support to proceed. Cramer stated that they would be approving the proceeding with the excavation and rock removal. Matt Parks agreed with Cramer, and stated that it is appropriate to have a motion to proceed with the excavation and rock removal and the cost amounts are approved for reimbursement pursuant to the DDA. Thomas Halley moved to approve Oppenheimers proceeding with the excavation and rock removal and the cost amounts are approved for reimbursement with the maximum amount of $899,317.00 pursuant to the DDA, Dave Radford seconded the motion and it passed unanimously. Cramer stated that the DDA also talks about the Agency’s approval of the drawing and site plans. Cramer stated that they have been given informal approval to submit the drawings to the City for permitting, and they would like a formal Board approval and acceptance of the layout. Cramer stated that the layout, and design can still be discussed, but they would like to move forward on the permits for the garage. Cramer stated that the current drawings when compared to what was anticipated in the DDA are appropriate and 10 Idaho Falls Redevelopment Agency September 21, 2017 meets the requirements that the DDA laid out as far as stalls, the inclusion of a plaza, and water feature. Matt Parks stated that in the approval of the DDA, it approved staff to review and confirm that the plans were consistent and approve the plan to move on to the permitting phase, so a motion is not required, and this is more of an informational item. Parks asked the Board to signify informal approval of the process and moving forward to the permitting phase, that would make the developer comfortable. Brent Thompson asked about the design truncating at the existing alley and doesn’t flow out to the east across the alley as it appeared in earlier design versions. Jeremy Malone. Malone stated that they only control up to the alley, and the alley will remain part of the City’s right of way, so they haven’t designed beyond that. Malone stated that they are working with the Bank of Idaho as they do a remodel and it could extend out into a bigger picture. Brent Thompson clarified that there is not a need to make a motion. Jeremy Malone stated that the plaza will not have the compass design and they are looking for an alternative design. Malone added they are going with the core function of the garage, and will worry about the cosmetic side as it evolves. Brent Thompson stated that the PSA is not finalized and they are waiting for the guaranteed maximum payment amount to be finalized to add to the agreement. Brent Thompson stated that Cramer and the Oppenheimers will work on getting that number, and when it is determined, there may be a special meeting to approve the PSA so they can move ahead with construction. Dave Radford asked if they can give approval authority to 3 members of the Board. Thompson stated that they are voting to approve the Purchase and Sale Agreement and they would need a quorum. Dave Radford suggested having a telephonic meeting. Cramer encouraged the Board members to be involved in this matter as the commitment is millions of dollars. Matt Parks stated that the form of the Agreement is what was expected and there are no surprises. Parks stated that there are no issues with the design of the project and once Oppenheimers go through the numbers from the contractors, they will provide a number to the Agency as a guaranteed maximum price proposal. RAI Legislative Activities. None. Next Regular Meeting: October 19, 2017. Thomas Halley moved to adjourn the meeting, Dave Radford seconded the motion and it passed unanimously. Respectfully Submitted: Beckie Thompson 11 Idaho Falls Redevelopment Agency September 21, 2017