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HomeMy WebLinkAbout05-08-18 Minutes - Northeast Urban Renewal Board (NURB) NURB Meeting – May 8, 2018 1 Northeast Urban Renewal Board (NURB) Regular Meeting Tuesday, May 8, 2018 The Northeast Urban Renewal Board met in regular meeting at 6:30 p.m. on Tuesday, May 8, 2018, in the Conference Room, Professional Building, 20 East Olive Street, Bozeman, Montana. Present: Absent: Voting Members: John Usher, Chair Bobbi Clem Dan Doehring Robert Pavlic Jeanne Wesley-Wiese Non-Voting Members: Nolan Campbell Ethan Barlow Dalton Brink Commissioner Liaison: I-Ho Pomeroy Staff: Shane Strong, KLJ Engineering Brit Fontenot, Economic Development Director Robin Sullivan, Recording Secretary Guests: Chris Nixon, 719 North Wallace Avenue Maurice Quanbeck, 520 North 11th Avenue Erik Nelson, 33 North Black Avenue Brian Caldwell, 33 North Black Avenue Call to Order – Chair John Usher called the meeting to order at 6:30 p.m. Changes to the Agenda – No changes were made to the agenda. Public Comment – No comment was received under this agenda item. Minutes – April 3, 2018. It was moved by Jeanne Wesley-Wiese, seconded by Dan Doehring, that the minutes of the meeting of April 3, 2018, be approved as submitted. The motion carried on a 5-0 vote. NURB Meeting – May 8, 2018 2 Discussion/Action Items – Continued presentation of the Cottonwood & Ida Project. Due to a conflict of interest, Nolan Campbell removed himself from the table during this agenda item. Erik Nelson gave an overview of changes made between their last presentation and this meeting, noting that the second portion of the discussion will include consideration of a request to use tax increment financing monies for some portions of the project. Erik Nelson noted that the overall project has not changed from the concept plan previously submitted. The buildings will be clustered, with a public plaza space provided off the Misco Mill building. Access points will be provided from East Cottonwood Street and North Ida Avenue; and access to the underground garage will be from East Aspen Street. The goals of the project have also not changed, with the intent to provide both attainable units and affordable housing units at HUD standards of 70 percent AMI, or approximately $36,000 a year for Bozeman. The project is designed to provide opportunities for employment and to create opportunities for artists through the inclusion of makers units on the ground floor. He concluded by stating that superior urban design strategies are being incorporated into the project. He noted that the design and height of the buildings take into consideration their relationship to existing houses and their viewshed. Erik Nelson stated the project includes 93 residential units, with 18 for sale and 75 for rent with 20 percent, or 15, of those being at an affordable level. The project also includes 18,000 square feet of commercial leasable space and 4500 square feet of makers spaces. The underground parking garage will contain 178 parking spaces with 60 of those being public spaces. Also, 24 on-street parking spaces will be provided and over 100 bike spaces in various locations on the site. Nearly 50,000 square feet of open space is included, with 11,000 square feet in the public plaza and almost 30,000 in landscaping within the site and on the perimeter. He stressed that this represents roughly 50 percent of the site. Brian Caldwell highlighted the issue of superior urban design, noting that in a normal development, over 50 percent of the site would be asphalt and parking. In this proposal, they have provided the parking underground. Erik Nelson reviewed the locations and preliminary designs for each of the five new buildings on the site. He stated all of the buildings are three stories with the exception of a pop-up on one of the buildings. He noted that Building 1 has one-bedroom and studio units, with a bike room for the residents. Building 2 is also residential in a progressive co-living format with six small studio apartments sharing a larger common kitchen and laundry area. While Building 3 looks like traditional townhouses, it is not. Building 4 includes makers spaces on the ground level plus 5 one-bedroom units and 12 two-bedroom units. Building 6 will house some type of office use. Building 5 is the existing one-story building on the site. Erik Nelson stressed that there will be no retail spaces or restaurants within this development. The underground parking will be located below the public plaza; and the residential parking will be separated from the commercial parking. Storage lockers for all of the residential units will be provided on that side of the garage. Erik Nelson turned attention to how this project aligns with the goals of various plans, including the growth policy, design objectives plan, urban renewal plan, economic development strategic plan, Vision NorthEast plan, and the unified development ordinance. He noted that it meets NURB Meeting – May 8, 2018 3 most of the goals in each of those documents and is designed for a broad mix of demographics that is reflective of the northeast area. Erik Nelson stated that tax increment financing monies are being requested for 60 parking spaces in the underground garage, off-site infrastructure improvements and impact fees. He estimated the increment from this project will be $352,000 a year, which he anticipates will cover the payments for a $3.1 million bond issue at an interest rate of 4.5 percent for a 20-year period. He stressed that it would not be possible to do this project without the assistance of tax increment financing and noted that all funding tools available will be needed to ensure the project’s success. Erik Nelson showed renderings of the various buildings, recognizing that additional detail work will be needed in the final plans. Responding to questions from Bobbi Clem, Erik Nelson stated that East Aspen Street is a dedicated street right-of-way. He noted that the City Engineering Department is not receptive to the optional street section previously submitted but is requiring a standard street section. Jeanne Wesley-Wiese questioned why the City is not willing to look at an alternative street section for this short street. Brian Caldwell responded it is their intent to continue pushing for an alternative street section as they move through the review process. Erik Nelson stated the planned unit development process is ongoing; and he anticipates the submittal will be made within the next one and one-half months. He indicated that this Board’s support of the project and its commitment to consider the issuance of tax increment urban renewal bonds is essential to its success. Responding to questions from Bob Pavlic about the groundwater level on this site, Brian Caldwell stated the public plaza will be ramped up to podium level to accommodate the parking below grade. He then stated a number of test points have been established on the site to determine the groundwater level. The concrete and waterproofing will be designed based on that information. Responding to additional questions from Bob Pavlic, Erik Nelson stated there will be some graded earth on the site to accommodate the underground parking and some will be at current grade. Brian Caldwell stated the underground parking structure will be completely ventilated. He noted that any grading on the site will be at a walkable grade so that all buildings can be easily accessed. Further responding to Bob Pavlic, Brian Caldwell stated detention swales will be provided throughout the site; and the water will be allowed to percolate back into the ground. He stressed that runoff can be easily accommodated on the site, particularly since it will include a minimal amount of hard surfaces. Bob Pavlic asked about staging for development of this site, particularly in light of it being done in a single phase. NURB Meeting – May 8, 2018 4 Erik Nelson responded that they will not be closing any streets and there will be no stacking of materials on anyone else’s private property. He then indicated that staging will probably occur on the Idaho Pole site. Responding to questions from John Usher, Brian Caldwell stated that the floor to ceiling height of this underground parking garage will be similar to the one located on West Mendenhall Street behind the old John Bozeman’s Bistro; however, the grade of the incline will be significantly less. He indicated that he has asked the designers to provide an 8 foot 6 inch clearance for the parking structure. Responding to questions from Bobbi Clem, Erik Nelson stated the utilities for this site will be underground. Discussion of NURB Resolution 2018-02 and draft Memorandum of Understanding for the Cottonwood & Ida Project. Brit Fontenot reminded the Board that in February, they adopted Resolution No. 2018-01, which indicated general support for the concept of the Cottonwood & Ida planned unit development. He stated that Resolution 2018-02 encourages the Commission to approve the Memorandum of Understanding and indicates the Board may consider the issuance of tax increment urban renewal revenue bonds in the future to reimburse the costs of infrastructure improvements constructed in conjunction with this project. He briefly highlighted some of the provisions within the Memorandum of Understanding, stressing that it is not binding on the Department of Community Development or the City Commission to approve the project. He indicated that, while the Memorandum of Understanding does not obligate anyone to anything, it does indicate general support for portions of the project and indicates that it generally meets the goals of the district. He indicated that this resolution is based on the previous resolution of support and includes some of the language from the Memorandum of Understanding. He indicated that these documents are scheduled for discussion only at this time, with action to be taken at a future meeting. Responding to questions from John Usher, Brit Fontenot stated the Memorandum of Understanding was drafted by an attorney from bond counsel Dorsey Whitney and was reviewed by the City Attorney. He indicated the document identifies those projects that would be eligible for reimbursement from tax increment financing monies. Further responding to John Usher, Brit Fontenot confirmed that the parking spaces identified as public parking spaces in the underground garage would be added to the City’s inventory and would be administered by the City. Erik Nelson stated the intent is for the parking spaces to be leased like they are in the downtown parking garage. Brian Caldwell stated that, if there are not adequate monies in the bond issue to be funded by this project, reimbursement for the parking spaces is the lowest priority. Responding to questions from John Usher, Erik Nelson stated that the estimated annual tax of $352,159 is based on 1 percent of the total estimated project cost. He stated that the taxes from the existing Tin Works will go to the ordinary taxing authorities; however, the remainder of the taxes will go to the tax increment financing district. He then noted that only a portion of the tax increment may be used to service the bond debt; and a portion of the monies would then be NURB Meeting – May 8, 2018 5 available for other projects in the district. He stressed that the increment would be spent entirely within the district. Responding to questions from John Usher, Brit Fontenot stated that the State, County, School District and City get their portion of the taxes based on the year that the tax increment financing district was established; and any amount above that portion stays in the district. He noted that this Board has just bonded for $1.4 million but is now out of money. He stated this project could help to meet some of the remaining goals of the district. Responding to John Usher, Brian Caldwell stressed that their intent is to build the project, which will then be assessed and, at that time, they will seek reimbursement for qualifying portions of the project through issuance of bonds. He acknowledged that if the State does not value the project as anticipated, the amount of the bond issue would be impacted. Responding to Jeanne Wesley-Wiese, Brit Fontenot stated that approval of this request does not commit this Board to issue bonds for every developer. He noted that bonds are to be issued for improvements that have a public benefit and meet the goals of this Board. Brian Caldwell stated it is important to have this Board’s endorsement for the project, recognizing that it reflects the principles and goals of the District. Jeanne Wesley-Wiese observed that the current traffic on North Wallace Avenue is insane, especially around its intersection with East Peach Street. She voiced concern that no other place in town feels so congested as this area. She noted that this development, along with development of other sites in the district, will further compound the problem. John Usher stated that he, too, is concerned with the traffic that already exists and the impacts that additional development will have. He then expressed appreciation for the transparency of this project, particularly in light of other development that has occurred within this district. Responding to Bobbi Clem, Erik Nelson asked that the Board consider the resolution at its next meeting. Jeanne Wesley-Wiese noted that this project would double the annual increment after servicing the bond issue for it. She then stated people in the area are concerned that a Black/Olive type project could be proposed and approved for this site if this project is not pursued. Erik Nelson responded that they want to build a community, not “be a lesser of evils”. Chris Nixon asked if there will be a parkland dedication or cash-in-lieu for the residential portion of this project. Erik Nelson responded that they will be paying cash-in-lieu. They have also requested that this money be earmarked for parks in this area, but they cannot require it. Brian Caldwell stated they can brainstorm with a landscape architect to identify a project that could be done within this district for the amount they pay in cash-in-lieu in an effort to keep the monies within this district. NURB Meeting – May 8, 2018 6 Review of bids for East Tamarack Street project. Shane Strong reported that the City Clerk was not available to open bids today, so it has been delayed to 2:00 p.m. on Friday. He indicated that, once the bids have been opened, he will prepare a bid tab and get the information out to the Board. Brit Fontenot noted that, during installation of the sewer pipe under the creek, the access off East Tamarack Street to Lattice Materials will be closed and asked if access for deliveries and employees can be provided off East Aspen Street. Chris Nixon responded that vacation of the East Aspen Street right-of-way included an agreement that access will be provided to the Lattice Materials site as needed. He noted that it is simply a matter of unlocking the gate but observed that some encroachments on the Lattice Materials site will need to be removed to allow vehicles to enter. Responding to questions from Bob Pavlic, Shane Strong stated that the project is to be completed in a single phase. He then noted that the Vice President of Lattice Materials has expressed concern about how the noise and vibration might negatively impact their operation. As a result, he has issued an addendum to restrict that type of work to the days when Lattice Materials is not growing crystals, which is Thursday through Sunday. He cautioned the result will be an increase in the total cost. Chris Nixon asked if improvements to the depot will generate more increment for the district. Bobbi Clem responded that the developer plans to buy the building and lease the property, which should result in an increase in the increment. She then noted that the developer is interested in providing parking at the northwest end of the depot, particularly since the parking lot can be accessed from the end of the improvements made under this project. Updates on current projects. Shane Strong reported that the new superintendent for JR Civil will be in town on Monday, May 14, to complete the East Peach Street improvements. There are fourteen calendar days remaining on the contract, after which penalties will begin. He stated that the improvements include milling and paving of the entire length of the project as well as smaller remaining items. As a result, he asked that the Neighborhood Coordinator disseminate JR Civil’s work schedule once he receives it. Staff updates on items of interest to the Board. Brit Fontenot stated he has no additional report at this time. Update on financial status of NURB fund. Robin Sullivan distributed copies of the revenues and expenditures for Fiscal Year 2017-18 and the spreadsheet showing expenditures from the bonds. She noted that the major expenditure for this month was for engineering services on the East Tamarack Street project. Shane Strong estimated the remaining costs for the East Peach Street project at $97,000. NURB Meeting – May 8, 2018 7 Continued discussion on draft Work Plan and Budget for Fiscal Year 2018-2019. Robin Sullivan noted that she had e-mailed the revisions to the draft work plan and budget to the Board members and distributed hard copies of the plan just prior to the meeting. She indicated that the changes are in red so they can be easily identified. Responding to questions from Jeanne Wesley-Wiese, Brit Fontenot stated that the paragraph added under “Moving Forward – FY 2019” is an acknowledgement of his notifying the Board a few months ago of the Mayor’s direction to identify ways to streamline all of the existing boards. He noted that some communities have an agency that oversees all of the tax increment financing districts in the community, with a single board rather than multiple boards. Brit Fontenot suggested that under “FY 2018 at-A-Glance” a paragraph be added to reflect that the Board adopted Resolution 2018-01 expressing support for the Cottonwood & Ida project; the Board agreed to the addition. John Usher guided the Board through the draft Work Plan, asking for Board comment on each of the proposed revisions in the May 8 version of the plan. The Board agreed with the changes except for one minor wording change. Robin Sullivan briefly highlighted the changes in the proposed budget, noting that those changes result in a balanced budget and will adequately cover the costs of the various line items based on historic expenditures. It was moved by John Usher, seconded by Jeanne Wesley-Wiese, that the Board approve the Work Plan and Budget for Fiscal Year 2018-2019 as revised. The motion carried on a 5-0 vote. Brit Fontenot reported that this work plan and budget will be submitted to the Commission on the consent agenda for its June 4 meeting. He then stated that, in the future, budget presentations are to be made to the Commission by the Chair of the Board. Set agenda for June 5, 2018 meeting or cancel meeting. To be included on the June 5 agenda, in addition to the standard agenda items, are a decision on the resolution for the Cottonwood & Ida project, a presentation from Bridger Builders regarding rehabilitation of the depot, and possibly discussion with the Recreation and Parks Advisory Board regarding wetlands and cash-in-lieu of parkland monies. FYI/Discussion (formerly Neighborhood News). There was no discussion under this agenda item. Adjournment – 8:45 p.m. There being no further business to come before the Board at this time, Chair Usher adjourned the meeting. John Usher, Chair Northeast Urban Renewal Board City of Bozeman