Corridor Improvement Authority

CITY OF STERLING HEIGHTS CORRIDOR IMPROVEMENT AUTHORITY MINUTES OF THE SPECIAL MEETING April 23, 2008– 5:30 P.M. CITY CENTER – ROOM 201 Approved Dan Crombez called the meeting to order at 5:30 p.m. Members present at roll call: Daniel Crombez, Salvatore D’Angelo, Mary Marcinak Denice Gerstenberg, Pat Lehman, Rose Tocco, and Doug Skrzyniarz. Members absent: NONE Also in attendance: Luke Bonner, Economic Development Manager; Jim Buhlinger, City Treasurer, Kathy Metzger & Angie Freeman, Huntington Bank, Teresa Jarzab, Recording Secretary Motion to Approve the Agenda Moved by Marcinak, supported by Skrzyniarz, to approve the agenda as presented. Ayes: All Nays: None Motion carried. Motion to Approve the April 9, 2008 Minutes Moved by Marcinak, supported by Gerstenberg, to approve the minutes from April 9, 2008. Ayes: All Nays: None Motion carried. Façade Improvement Program for the Corridor Improvement Authority District Mr. Bonner introduced Kathy Metzger and Angie Freeman from Huntington Bank. Ms. Metzger addressed the issue by Ms. Marcinak about fixed rate loans. Huntington Bank proposed a variable rate up to 1% below prime, or ½% for anyone who qualifies for the improvement program, and an additional ½% for anyone who initiates a new relationship on the deposit side with Huntington for a total of 1% below prime for the seven years, depending on what the prime is. A fixed rate can also be done, based on the borrowers needs. Mr. Crombez asked if they had to open an account with the bank. Ms Metzger responded yes in order to get the full 1%; otherwise they would get the ½%. Ms. Lehman asked if there would be minimum required balance to an account that would have to be opened. Ms. Metzger replied no. Ms. Marcinak questioned if they had an existing account with another branch would they have to change branches. Ms. Metzger replied no, and if they signed up for the automatic withdrawal from the checking then the bank could do ¾%. Mr. Crombez questioned if the authority would still pay their share of the loan if the owner found financing somewhere else. Mr. Bonner replied that this program is specific for Key and Huntington Banks. Mr. Skrzyniarz questioned if 25% up to $75,000 would be reimbursed by us. Mr. Bonner responded yes. Ms. Marcinak questioned the loan application fees. Ms. Metzger responded that there isn’t a loan application fee, but there is a $150 closing fee. Ms. Marcinak asked if that could be waived, Ms. Metzger did not believe so, because the price is so low. Mr. Bonner stated that Key Bank intended this program to be variable rate during construction, and then it would turn into a fixed rate after construction is finished. Key Bank also said that they would have no issue with a fixed rate loan. Ms. Tocco asked if Key Bank was going to revise their flyer, Mr. Bonner stated that he would ask them to do that. Ms. Tocco asked if they had the option to maintain the variable rate if wanted. Mr. Bonner thought that they would be able to choose. Mr. Skrzyniarz stated that we have the two options to use. Mr. Crombez stated an objection to limiting the finance options to the two banks. What if they wanted to use a credit line? Mr. Bonner stated that we would not reject them because of that, and we would look at that option as well. Mr. Bonner addressed the issues of the language with the C of O. It will be a Certificate of Occupancy, or Certificate of Completion, or any other documents issued by the City showing final inspections. Ms. Lehman asked if we would be waiving those fees. Mr. Bonner replied that the City Development Director said that we would not be waiving the fees. Ms Tocco asked what those fees are. Mr. Bonner was not sure what the fees are. Ms. Marcinak would like our packet to include a breakdown of what the fees are. Ms. Marcinak asked if the fees would be part of the 10%. Mr. Bonner said that would be up to the bank to decide. Ms. Metzger replied yes they could be included in soft costs. Mr. Bonner addressed the issue about adding a CIA Committee member to the review committee. The ordinance was already established for the Site Plan Review Committee, to include Luke Bonner, Denice Gerstenberg, the City Development Director, and the City Planner. Mr. Bonner spoke with Mr. Mende, the City Planner and he said it could take up to 90 days to amend what we have already done. When the review committee makes a recommendation, then the CIA board will have to approve it because there is funding involved. Ms. Marcinak questioned what authority does the CIA board have over the final recommendations. Mr. Bonner said that the final approval would come from this board. Discussion ensued about the approval process and what powers each board has for the review process. General discussion about the Building Authority responsibilities, and when would we go to City Council. Mr. Bonner stated that the board would be reviewing any project that is applied for. Ms. Marcinak questioned whether or not architectural fees could be included in the 10%. Ms. Metzger said yes that soft costs are counted into the 10% equity. Mr. Bonner addressed the Agreement to Repay Advance to the City of Sterling Heights. General discussion ensued about the agreement and taxable values in the district. Ms. Marcinak questioned if property taxes would increase, as a result of a façade improvement. Mr. Bonner stated that the Assessor would only increase an assessment if the footprint or square footage of the building increased. Mr. Skrzyniarz questioned what would happen if the CIA defaulted on the loan. Mr. Bonner stated that we could amend the agreement and go back to the City Council. Ms. Marcinak questioned if the $200,000 advance was going to be a line item, and would we be collecting interest on that money. Mr. Buhlinger stated yes that it would earn interest, and the interest would stay with the fund. Motion to approve the Façade Improvement Program for the Corridor Improvement Authority Motion by Marcinak, supported by Lehman Ayes: All Nays: None Motion carried. Resolved, to approve the Façade Improvement Program for the Sterling Heights Corridor Improvement Authority Development Area and authorize the Chairperson and Secretary/Treasurer to sign the agreement to repay advance as required in conjunction with this approval. Ayes: All Nays: None Motion carried. Public Comments The committee thanked Huntington Bank for coming. Adjournment Moved by Lehman, supported by Marcinak to adjourn. Ayes: All Nays: None Motion carried. The meeting adjourned at 6:00 p.m. TJ Minutes Approved 11/19/2008 Rose Tocco, Secretary