Idaho Falls Redevelopment Agency

IDAHO FALLS REDEVELOPMENT AGENC Y P.O. BOX 50220 IDAHO FALLS, ID 83405 March 21, 2024 Regular Meeting Minutes Council Chambers Call to Order: Lee Radford called the meeting to order at 12:00. Members Present: Lee Radford, Chris Pelkola Lee, Chris Harvey (via Teams), Brent Thompson, Terri Gazdik Members Absent: Jon Walker, Lisa Burtenshaw Also Present: Ann Peterson; Brad Cramer; Meghan Conrad, Esq. (via Teams); Brian Stevens, Cassie Auten, Catherine Smith, and interested citizens. 1. Modification to Agenda. None. 2. Approval of Minutes February 15, 2024. Chris Pelkola Lee moved to accept the Minutes for February 15, 2024, Thompson seconded the motion, and the motion passed. 3. Approval of Expenditures and Finance Report. Lee Radford presented the Finance Report dated March 21 2024. In the River Commons Area: $87.50 to Rebecca Thompson for transcription of Minutes; $3,832.60 to Elam and Burke for legal services; $5,000.00 to Rudd and Company for the Audit; $1,360.00 to City of Idaho Falls for administrative services. In Eagle Ridge Area: $487.50 to Brad Cramer with Perspective Planning and Consulting for Financial Feasibility Study; $1,427.00 to Elam and Burke for legal services; $200.00 to City of Idaho Falls for administrative services. In Jackson Hole Junction: $200.00 to the City of Idaho Falls for administrative services. In Pancheri East: $125.00 to Elam and Burke for legal services. Thompson asked on the budget with the current expense under River Commons of $5,000 for the audit, and asked why that is only taken from the River Commons Fund. Cassie Auten stated that they haven’t discussed how much of a percentage needs to be allocated to each of the other Districts, in the previous years, they have charged River Commons. Stacy Lemon, Rudd and Company stated that last year they wanted to separate out a general fund for general expenditures and it was decided that the River Commons would be general fund, so administrative expenses are paid through that fund. They can create a general fund if they want to have administrative expenses paid from, or they can allocate it to the separate funds. Radford stated that they put the expense in the area that is generating revenue and had funds and is ahead with funds. Snake River Fund used to be the one that they used for “general expenses.” Gazdik stated that they did budget in the budget to actual under Eagle Ridge and Jackson Hole Junction for audit fees and they should allocate to those Districts some of that expense. Radford stated that they should do it like the audit fees and separate it between the different funds. Thompson moved to approve the Finance Report dated March 21, 2024, Gazdik seconded the motion and the motion passed unanimously. 4. 2023 Annual Report Public Hearing and Comment Radford opened the public hearing for the 2023 Annual Report. No one appeared in support or opposition. No written submissions were received. Radford closed the public hearing for the 2023 Annual Report. Thompson likes the appearance and outward presentation of the Report. Ann Peterson indicated that Wade Sanner is the lead on this project, he has chosen a front cover, and they will be printed as soon as Sanner gives the go ahead to IE Productions. Radford stated that maps were inserted for each area and that is a big help. 5. Consider Resolution 24-03 Approving the 2023 Annual Report, Authorize Filing the Annual Report with the City Clerk, and the Idaho State Controller’s Office as Required by Idaho Law, and Authorize Publication of the Legal Notice Filing. Conrad read the Resolution by Title. A RESOLUTION OF THE BOARD OF COMMISSIONERS OF THE URBAN RENEWAL AGENCY OF IDAHO FALLS, IDAHO, ALSO KNOWN AS THE IDAHO FALLS REDEVELOPMENT AGENCY, TO BE TERMED THE “ANNUAL REPORT RESOLUTION,” APPROVING THE ANNUAL REPORT OF THE URBAN RENEWAL AGENCY, FOR CALENDAR YEAR 2023; APPROVING THE NOTICE OF FILING THE ANNUAL REPORT WITH THE CITY AND IDAHO STATE CONTROLLER; AUTHORIZING ANY TECHNICAL CORRECTIONS TO THE ANNUAL REPORT; AUTHORIZING THE CHAIR, VICE-CHAIR, OR AGENCY ADMINISTRATOR TO FILE SAID REPORT; AND PROVIDING AN EFFECTIVE DATE. Chris Pelkola Lee moved to approve Resolution 24-03 Approving the 2023 Annual Report, Authorize Filing the Annual Report with the City Cleark and the Idaho State Controller’s Office as Required by Idaho Law, and Authorize Publication of the Legal Notice Filing. Thompson seconded the motion. The motion passed unanimously. 6. Consider Resolution 24-04 the First Amendment to the Urban Renewal Plan for the Eagle Ridge Urban Renewal Project Concerning Deannexation of Parcels and Right-of- Way from the Eagle Ridge Project Area. Conrad stated that in February there was a draft of the Amended Plan and a draft Supplemental Economic Feasibility Study provided by Brad Cramer. Conrad directed the Board to the narrative portion of the First Amendment Document showing the deannexation map and legal as Attachment 1-A and the maps were reviewed by the State Tax Commission GIS for a pre-check and meet their requirements. The maps included have been stamped in final and when the packet was copied the stamp disappeared but if this action moves forward the stamped maps will be back in the packet. The deannexation (triangle parcel and right of way up Pioneer Road) will be 8.4 acres that is being removed and it amends the certain portions of the Plan that has an impact as a result of the deannexation. The bulk of the deannexation and the impact is in the new Attachment 5-A which is the Supplemental Economic Feasibility Study. There are two findings in the Economic Feasibility Study, including the deannexation itself does not create a financial hardship to the District; and second Cramer has included the anticipated revenue generation is and repayment based on the existing OPA’s that were entered into with the two developers int eh remaining portion of the District. In terms of processing this is processed the same as a new plan and if it moves forward the Board would consider the Resolution; transmitted to City with publication notice for overlapping taxing district; City Council for public hearing; Planning Commission for finding of conformity with the Comprehensive Plan. Radford clarified that this is the deannexation to the Eagle Ridge and asked how it relates to the Snake River West. Conrad stated that the adjacent parcel south along Pioneer Road, south of the storage units is the area, together with the deannexation will be the proposed Snake River West area. Radford asked where they are on the Snake River West. Conrad stated that the process there has been that the Agency considered the Eligibility Study and in coordination with the City it will go before City Council in April. Brad Cramer, Perspective Planning. Cramer presented a Power Point Presentation and highlighted the changes from the last report. Slide 1 – Study Approach. They took out the deannexation of the southern most parcel and it was not a significant contributor and only contributed about $1600 per year towards the overall valuation of the taxes collected. They looked at the revenues and expenditures for both OPA 1 (Eagle Ridge Development) and OPA 2 (Eagle Ridge Project- apartments being built by Roundhouse Construction) Slide 2- revised OPA 1 Boundary including Guns and Gear. Slide 3 – OPA 2 is Roundhouse Development site on northern end of Eagle Ridge and includes a small portion of South Utah. Slide 4 – OPA 1 Boundary – Developer receives 85% of revenues for the remaining District which goes through 2034. Slide 5 – Changed the table and assumed the base valuation changed by 1% and it now stays flat. He also understood that My Space Hotel would come on to the tax rolls in 2026, but he now understands it is close to CO now. Slide 6 – The full balance is anticipated to remain unpaid by the end of the District with $450,000 remaining unpaid. This assumes no other development in the next 10 years. Slide 7- Option 2 (OPA 1) he assumes that 2 projects would potentially come online in the next 6 years with a small $5 million project and a $10 million project on the southern portion with bigger lots. Cramer stated that this is speculative. If some similar valuation project came online by 2030 this OPA will be paid off in 2034 with a small amount remaining ($250,000) for potential public projects. It is possible to obtain repayment, it will just take some additional development in the area. Slide 8- OPA 2 Boundary. Cramer has one option for this site, and Cramer is assuming that the development would not hit the tax rolls all at once. Cramer assumes that 1/3 of the development will come on every couple of years and the developer only receives 75% of the revenues. Slide 9- taking out the 1 % base valuation increase and assuming CO will be issued in phases, not after the entire 48 months. Slide 10 – the Balance is paid off in 2033 with $1.4 million available for public projects. Thompson asked if the $50 million came from a developer. Cramer stated that they estimate the total project as more than that, but there is $50 million within the District as some of the project spills out of the Eagle Ridge boundary. Pelkola Lee asked where to find Cramer’s Tables in the packet. There was discussion to clarify what packets coordinate with packet tables. OPA 1 Scenario 2 is Table 11. Thompson asked about the $1600 coming off the deannexation. Cramer stated it is just an adjusted amount and Cramer is unsure where the increment is coming from because there is not a development. Thompson suggested it is increased valuation due to build out around it. OPA 2 is table 7 and 8. Eagle Ridge Development is OPA 1 Eagle Ridge Project is OPA 2 (Roundhouse) Gazdik asked Cramer if he has been to the site, as it appears that they have started with groundwork. Cramer stated that it is a 4-year project, and it does appear that they have begun work. Radford stated that if they were trying to get people to move closer to the River, they are now meeting their goal, with all these projects close to the River and Greenbelt. Conrad read the Resolution by Title. A RESOLUTION OF THE BOARD OF COMMISSIONERS OF THE URBAN RENEWAL AGENCY OF IDAHO FALLS, IDAHO, ALSO KNOWN AS THE IDAHO FALLS REDEVELOPMENT AGENCY, RECOMMENDING AND ADOPTING THE FIRST AMENDMENT TO THE URBAN RENEWAL PLAN FOR THE EAGLE RIDGE URBAN RENEWAL PROJECT, WHICH FIRST AMENDMENT SEEKS TO DEANNEX CERTAIN AREA FROM THE EXISTING EAGLE RIDGE PROJECT AREA; AUTHORIZING AND DIRECTING THE CHAIR, VICE-CHAIR, OR ADMINISTRATOR AND THE SECRETARY OF THE AGENCY TO MAKE CERTAIN TECHNICAL CHANGES; AUTHORIZING AND DIRECTING THE CHAIR, VICECHAIR, OR ADMINISTRATOR TO TAKE APPROPRIATE ACTION; PROVIDING FOR THIS RESOLUTION TO BE EFFECTIVE UPON ITS PASSAGE AND APPROVAL; AND PROVIDING AN EFFECTIVE DATE. Thompson moved to approve Resolution 2024-04 the First Amendment to the Urban Renewal Plan for the Eagle Ridge Urban Renewal Project Concerning Deannexation of Parcels and Right-of-Way from the Eagle Ridge Project Area, Gazdik seconded the motion. The motion passed unanimously. 7. Accept the FY2023 Audit and Authorize Filing with the State Controller’s Office, Legislative Services Office and Other Locations as May be Required by Statute. Stacy Lemon, Rudd and Company Representative Lemon supervised and reviewed the audit work for the Redevelopment Agency. Lemon stated that the report is unmodified, which means that the financial statements are reasonably stated the way they are, after the adjustments that were provided to Cassie Auten. Lemon turned to page 13, which is the balance sheet for each individual fund. The balance consists of cash investments of $2 million, which is up about $200,000 from the previous year and a minimal amount of property taxes to be received at the end of the year of about $6,000. Most of the money is in River Commons with $1.8 million and a small amount in Eagle Ridge and Jackson Hole and Pancheri East. Money in Pancheri East is from the developer to cover the up-front cost of creating the Urban Renewal Area, and the expenses associated therewith. Lemon turned to page 15, Statement of Revenue and Expenditures (Profit and Loss Statement). The River Commons receives the majority of the property tax revenues for the year of $1.1 million and Eagle Ridge has $50,000 and Jackson Hole has $230,000. The other revenue consists of earnings on investments (interest income) and the other income of $33,000 is from developer agreements with upfront payments of the developer to cover eligibility, feasibility, legal, and other startup costs for the urban renewal areas. River Commons Fund is functioning as general fund and most administrative expenses are being paid for by resources from that fund. Some fees have been allocated to individual funds including City of Idaho Falls Administrative fees. Professional services of $65,000 in River Commons are audit fees, legal fees, and other minimal fees. There are legal Fees in Eagle Ridge and Pancheri East. The OPA payments are the biggest expenses. The payments that were made for River Commons have an interest of $540,000 and principle on all of those promissory notes of $300,000 during the year. Eagle Ridge doesn’t have interest, as the agreements are structured differently, and Jackson Hole has no interest, so there are no interest expenditures in those funds. Lemon turned to page 26 showing all the OPAs. The one that says in February 2023 shows all the new ones entered into this current fiscal year ending September 30. OPA with Sentinel Properties for $350,000, which was amended in May to $445,000; Agreements with Tailwater $433,000 and $1.7 million. Lemon turned to page 28 showing the other agreements that were entered into during the year such as MOU with developers to provide up front money to cover exploration costs, including: Middle R Holdings, and Yellowstone Square Development. Some funds have been received by the Agency and some will still be coming as things are approved. Lemon turned to page 34 Budget to Actual Comparison for each fund. There is no comparison for Pancheri East as it was new this year and no budget set to compare. River Commons (page 34) the property taxes received were under what had been anticipated and expenditures were only related to principal and interest and nothing that was budgeted for capital outlays was spent, so they are underbudget. Eagle Ridge (page 35) property taxes were lower than anticipated and nothing was paid out for capital outlay and only the principle on the note for the year. Jackson Hole had higher property taxes than anticipated and there were payments for OPA that were higher than what was budgeted for, and no money was spent on projects. Lemon stated that the letter that she gave to the Board Members is the opportunity to mention things they found in the audit that didn’t rise to the level of the financial statements to be misstated in any way, and they had nothing this year to bring to the Board. Gazdik asked about the property tax collection less than budgeted, what caused that. Lemon stated that it was Statewide reduction as the assessment was not less, so that should reverse in 2024. Chris Pelkola Lee confirmed that it was due to Legislative changes and Lemon agreed. Radford stated that residential property taxes have increased in value faster and commercial doesn’t adjust as quickly. Chris Pelkola Lee asked if the Legislative change only affected last year. Gazdik stated that the communication was that it was a budget excess and so it was returned in the form of reduction of property tax to all of the Agency’s so it will be on a year-by-year basis. Gazdik asked if LGIP account is still the best way. Lemon stated it made about $60,000 this year and is the safest for investing. Gazdik asked if the other government agencies put their money in LGIP. Lemon agreed that most government agencies use LGIP for significant overflow. Gazdik asked what they use the interest income for on the budget and where is it allocated. Radford stated that they don’t treat it differently, it is just in the budget. Gazdik clarified that that money is factored in as part of the cash disbursement. Lemon stated that the budgeted amount for earnings on investment was only $25,000 and it ended up being $60,000. So, they are conservative about budgeting that amount. There are always expenses that are more administrative, like the audit that you need money to pay for. Radford stated that the non OPA expenses they try to get covered with MOUs, but there is a chunk that doesn’t get covered, and the interest can cover than remainder. Lemon stated that legal is the highest expense that isn’t covered. Thompson moved to Accept the FY2023 Audit and Authorize Filing with the State Controller’s Office, Legislative Services Office and Other Locations as May be Required by Statute, Gazdik seconded the motion. The motion passed unanimously. 8. April 25, 2024, City Club Presentation – Idaho Falls Redevelopment Agency: Smarter Growth for a Better Community. Radford has been asked by City Club to make a presentation about Urban Renewal in Idaho Falls. Radford will provide a summary where he provides the Annual Report to explain what the Agency is doing and explain the mission that they are trying to save property taxes for taxpayers and make a more efficient and workable City and community. The Annual Report will be helpful, and the power point will walk through the Areas, and focusing on urban core; focused on re-using properties; and will explain about the projects; and lets people know where the Agency is at. The process Flow chart will be used to explain how the program works. They want to get the word out and get developers interested and join the Agency. Radford feels it is good to have all the documents, the annual report, the Agenda’s, and Minutes on the website and be transparent. He will have ½ of his time with City Club for questions. If anyone has input or wants to help answer questions, Radford would love the help. Thompson stated that the development around the Greenbelt should be pointed out as it is impressive what has been done and it is part of the Agency’s Mission Statement. Radford went back to old presentations and when you compare the areas from the past to the number of areas that they are working on currently it is impressive. The Agency is juggling a lot more, and it is important to get the word out. Gazdik stated that Radford should bring pictures to illustrate before and after including Memorial Drive and The Bonneville, Radford stated that the City Club Meeting is April 25, 2024 beginning at 12 at Bennion Student Union Building. 9. RAI and Legislative Update. Conrad stated that there is not much of an update, and they are in a hold pattern where a bill amending the urban renewal statutes is out there with a proposed replacement tool referred to as the LIDD. For a long time that was circulating in a draft form, and there is something that has been transitioned to a RS form (Routing Slip) which is the next step that it would take before it goes before a committee for introduction and print. They are optimistic that this will not come forth this year. They are at the part of the session where things move quickly, and rules are suspended, and process and procedure become faster with less notice. They are concerned and appreciative of the work that Idaho Falls and IFRA have done with speaking with the development community to get the word out about this potential bill as it has been helpful. They will continue to have these conversations during the off season. Conrad stated that something came out today before House Revin Tax Today, but it was held in committee, and she will look into it. Radford stated that a lot of people have been involved in the Legislative effort for urban renewal this year. People that are opposed to the use of the tool are concerned with using the tool for Greenfields, and he has assured them that this Agency does not do Greenfields. Radford stated that there is a gap between urban renewal and other things to get the correct infrastructure in place and is there a funding tool to help with infrastructure that is not urban renewal and that is an important discussion. Thompson asked Conrad about her power point on redevelopment 101 and in that power point she mentioned that since 2011 the establishment of urban renewal agencies has to be done by a vote. Thompson asked have those votes been taken by districts and what is the history (success vs. not). Conrad stated that she is aware that there have been several attempts to create an urban renewal agency, and she is not aware if any have gone forward on a ballot. There have not been any new agencies created since 2011. There are some agencies that were created but didn’t have a project area. Conrad stated that there might have been one in 2012 or 2013 but she is unsure she will look and come back to the Agency with an answer. Chris Pelkola Lee asked about the legislation last year or governors’ action that had the property tax relief, it hurt the funds for existing urban renewal, is there something that can be done or can they lobby to exclude existing projects, so they are not negatively impacted. Conrad stated that they have always taken the position that Urban Renewal is not a taxing district and only receives an allocation by its statutory authority, and that separates the agency out from City/County/School District. When there is a large-scale change to the system, Urban Renewal Agencies don’t have a say, they do often weigh in and ask for no harm to the existing plans and project areas. When personal property tax exemption came online, there was a reimbursement from the State for the lost revenue dollars and urban renewal agencies were able to retain those dollars, but the second personal property tax exemption did not have the same accommodation. This last round under HB292 where they are removing levies from owner occupied and the State is backfilling those dollars, the urban renewal agencies did receive its allocated share of the backfill. Conrad feels this will be an annual process going forward and how those dollars are reimbursed will come in different ways, and it is lowering the levy rate, which can generate less revenue for the agency if values don’t increase. Radford stated that the levy rates have significantly decreased and are down to less than 1%. That is a function of the residential prices increasing significantly. Gazdik feels it is the cap on taxing agencies to assess more than 3% increase. So, you have rapidly rising value, but the Agency cannot assess more than the 3% and that drives the levy rate down. Chris Pelkola Lee moved to adjourn the meeting, Thompson seconded the motion passed unanimously. Next Regular Meeting: April, 182024. Radford adjourned the meeting at 1:00 p.m. Respectfully Submitted: Beckie Thompson