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HomeMy WebLinkAbout2005-07-25 SEDA Meeting Minutes (Original and Corrected Versions) MINUTES OF THE MEETING OF THE SPRINGFIELD ECONOMIC DEVELOPMENT AGENCY HELD MONDAY,JULY 25,2005 The Springfield Economic Development Agency met in the Jesse Maine Meeting Room,225 Fifth Street, Springfield,Oregon,on Monday,July 25,2005 at 6:22 p.m.,with Board Chair Tammy Fitch calling the meeting to order. A 1"1'ENDANCE Present were Board Members Anne Ballew,Tammy Fitch, Sid Leiken,Joe Pishioneri,Dave Ralston,John Woodrow,and Faye Stewart(6:52 p.m.). Also present were Community Development Manager John Tamulonis and City Recorder Amy Sowa. Board Members Bill Dwyer and Christine Lundberg were absent(excused)and Board Member Stewart arrived late(excused). APPROVAL MINUTES a. Minutes of June 27,2005. IT WAS MOVED BY BOARD MEMBER WOODROW WITH A SECOND BY BOARD MEMBER PISHIONERI TO APPROVE THE JUNE 25,2005 SEDA MINUTES WITH THE CORRECTION TO BOARD MEMBER BALLEW'S COMMENT AT THE TOP OF PAGE 2. THE MOTION PASSED WITH A VOTE OF 6 FOR AND 0 AGAINST(3 ABSENT— DWYER,LUNDBERG AND STEWART). COMMUNICATIONS a. Business from the Audience b. Correspondence Mr.Tamulonis discussed a letter from Lane County Tax Assessor Jim Gangle. Mr. Gangle recertified the total taxable assessed value within the Glenwood Urban Renewal Plan as being $106,986,910. That is about$2M more than last time the Board looked at the amount. Mr. Tamulonis said this amount would be the base value. Mr. Tamulonis distributed an exempt document from City Attorney Joe Leahy regarding Bonded Indebtedness. Each Board Member silently reviewed the document. Mr. Leahy gave a brief explanation of this memo. He said it spoke to termination of the Urban Renewal Agency. He said there was no danger of termination as long as there was debt,and there may be no danger when there was no debt for a period of time. The memo was for informational purposes only. Councilor Ballew gave an example of debt paid off earlier than expected and asked for clarification. Springfield Economic Development Agency Minutes July 25,2005 Page 2 Discussion was held regarding pay-off of the debt and when additional debt would be incurred. Further discussion was held regarding the term of the Urban Renewal Agency. Mr.Tamulonis said if the Urban Renewal Agency were to change the Plan,it would need approval by the voters. c. Business from the Staff REPORT OF CHAIR REPORT OF COMMITTEES Board Member Leiken said the financial institution he worked for had a client that owned property in Glenwood. He also noted that he was directly working with someone with a prospective interest in Glenwood. Mr. Leahy said it may not be an issue,but to be cautious he would recommend Board Member Leiken recuse. It may be that there were enough property owners in Glenwood that it wouldn't be a problem following his declaration,but he recommended checking further into it. Board Member Leiken recused himself from this portion of the meeting. OLD BUSINESS a) Discussion of City/SEDA Cooperation Agreement. SEDA is an independent agency under state laws with an interest in having general and specific functions done through an agreement with the City of Springfield. The character and extent of the relationship is in a key intergovernmental agreement between the two organizations. Since the previous discussion with the SEDA Board on May 96 and June 27th, 2005, staff has a draft agreement from SEDA to review,modify,and eventually approve for the City of Springfield to consider. Staff has discussions with expert individuals regarding renewal agencies and the character of agreements that define similar relationships elsewhere. In discussions on May 9,2005,the SEDA board provided staff with additional guidance on the items that might be included in a cooperation agreement. In working on the draft agreement, however,additional information from experts regarding other urban renewal agencies suggested a slightly more basic document that establishes the framework for long-term cooperation between an urban renewal agency and its authorizing City Council. A more basic document also permits more flexibility for the lengthy period of the urban renewal plan to adjust the detailed operational arrangements without having to redefine and modify the essential character of the agreement between the two organizations underlying the purpose of the urban renewal plan. Operational details can be modified and adjusted as conditions change,while the underlying character remains in place. An initial draft agreement would come to the SEDA Board for review,needed modifications,and possible forwarding to the City of Springfield for an August 1,2005 City Council meeting,the last council meeting before its summer recess. This agreement had been reviewed by 011ie Norville, former staff attorney for Portland Development Commission. Mr.Leahy noted that following the review by Mr.Norville,Mr.Leahy sent this agreement to the city's bond counsel in Portland for informal review. The bond counsel provided some Springfield Economic Development Agency Minutes July 25,2005 Page 3 suggestions some of which were incorporated in the amended Section 5 which was distributed by Mr.Tamulonis. Mr.Tamulonis said the plan was referred to when making this agreement. He said the amended Section 5 that would be inserted into the agreement before it was finalized. He explained the amendment to this section. Board Member Ralston asked who kept track of the debt incurred. Mr.Tamulonis said part of the SEDA budget included city services such as financial services to track those types of transactions in a separate portion of the city's budgetary system. Board Member Ralston discussed payments to the city by the SEDA. Mr.Tamulonis discussed payment back to the city and the amounts that would come to the city and other agencies after the district was terminated after twenty years. Board Member Ballew asked Mr. Leahy about the agreement, Section 1,on page 2. She read that section and asked if that was what Mr.Leahy had explained earlier. Mr. Leahy said it was not. His earlier explanation related to the document he distributed and that was related to the entire agreement because of the interpretation from State Statute ORS 457 on termination of the agency when the debt was gone. Mr.Kelly explained further this issue. Mr.Tamulonis said the paragraph referred to by Board Member Ballew referred to the Urban Renewal Plan. Discussion was held regarding the amount of tax increment financing the district could receive, which was limited. Any excess amount would go to the other taxing agencies. If the total amount of fmancing was used up and paid back prior to the twenty years,the agency would terminate or another vote would need to be taken to allow more debt and tax increment financing. Board Member Ballew discussed the section that related to subordinating any loans. Mr. Leahy said requests would probably be made and the SEDA Board would need to make that decision. Further discussion was held regarding subordinating loans. Mr.Tamulonis said paragraph one was well suited to the Urban Renewal Agency. Mr. Leahy said staff would bring a clearer explanation regarding this issue to the council. Board Member Ballew discussed Section 8. She had a concern about the statement that the city agreed to provide proper public services to properties located in the Urban Renewal District. She said there could be a point where the cost of services exceeded the amount of tax increment financing or other financing. The rest of the city would then be asked to subsidize services and maintenance within the urban renewal area. She suggested that at some point that cost of city • Springfield Economic Development Agency Minutes July 25,2005 Page 4 services be calculated on an annual basis and become a pass-through tax increment financing to the city. Mr.Tamulonis said the services could possibly be calculated,but payments through the tax increment financing may not be possible. He said other ways to cover the costs would be explored. Board Member Fitch gave an example regarding the proposed bike path. Mr.Tamulonis said the Urban Renewal Agency would try to build the infrastructure the city needed for long term development in Glenwood. The city would end up acquiring that asset as a public entity. Mr. Leahy suggested agreeing to the subordination for bonding,but agreeing to the subordination of other debt only after approval. Board Member Ralston discussed the cost of services and if it could be calculated into the amount of debt. Staff would find the answer to that question. Mr.Tamulonis said another opportunity might include acquiring property and leasing it out. That income could be offsetting some of the operational costs,but the tax increment income could not. IT WAS MOVED BY BOARD MEMBER BALLEW WITH A SECOND BY BOARD MEMBER WOODROW TO APPROVE THE CITY/SEDA COOPERATION AGREEMENT. Board Member Stewart arrived at 6:52pm and reviewed the agreement. IT WAS MOVED BY BOARD MEMBER BALLEW WITH A SECOND BY BOARD MEMBER WOODROW TO AMEND THE AGREEMENT BY ADDING LANGUAGE THAT SUBORDINATION IS CLEAR FOR BONDING PURPOSES,BUT FOR OTHER INDEBTEDNESS IT MUST BE APPROVED BY THE COUNCIL AND SEDA BOARD (SECTION 1); THAT COST FOR SERVICES IN EXCESS OF THE FROZEN TAX BASE WOULD BE ACCOMODATED BY THE AGENCY SUBJECT TO THE MUTUAL SATISFACTION OF THE CITY AND SEDA(SECTION 8); INCLUDE THE ADDITIONAL LANGUAGE IN SECTION 5; REMOVE THE TITLES UNDER SECTION 12 AND 13, "INDEMNIFICATION"AND"STATUS"; AND TO CORRECT THE TYPOGRAPHICAL ERROR UNDER RECITAL D TO HEALTH AND SAFETY. THE MOTION PASSED WITH A VOTE OF 7 FOR AND 0 AGAINST(2 ABSENT—DWYER&LUNDBERG). Mr. Leahy noted that the agreement had been sent to Steve Vorhees,legal counsel for Lane County. Board Member Stewart could contact Mr. Vorhees with questions. IT WAS MOVED BY BOARD MEMBER BALLEW WITH A SECOND BY BOARD MEMBER PISHIONERI TO ADJUST, SIGN AND FORWARD THE AGREEMENT TO THE CITY COUNCIL FOR CONSIDERATION AT THEIR AUGUST 1 MEETING. THE MOTION PASSED WITH A VOTE OF 7 IN FAVOR 0 AGAINST(2 ABSENT—DWYER& LUNDBERG). NEW BUSINESS Springfield Economic Development Agency Minutes July 25,2005 Page 5 RESOLUTIONS ADJOURNMENT The meeting was adjourned at 7:04 pm. Minutes Recorder—Amy Sowa 1 • Christine Lundberg Secretary CORRECTED MINUTES OF THE MEETING OF THE SPRINGFIELD ECONOMIC DEVELOPMENT AGENCY HELD MONDAY,JULY 25,2005 The Springfield Economic Development Agency met in the Jesse Maine Meeting Room,225 Fifth Street, Springfield,Oregon,on Monday,July 25,2005 at 6:22 p.m.,with Board Chair Tammy Fitch calling the meeting to order. ATTENDANCE Present were Board Members Anne Ballew,Tammy Fitch, Sid Leiken,Joe Pishioneri,Dave Ralston,John Woodrow,and Faye Stewart(6:52 p.m.). Also present were Community Development Manager John Tamulonis and City Recorder Amy Sowa. Board Members Bill Dwyer and Christine Lundberg were absent(excused)and Board Member Stewart arrived late(excused). APPROVAL MINUTES a. Minutes of June 27,2005. IT WAS MOVED BY BOARD MEMBER WOODROW WITH A SECOND BY BOARD MEMBER PISHIONERI TO APPROVE THE JUNE 25,2005 SEDA MINUTES WITH THE CORRECTION TO BOARD MEMBER BALLEW'S COMMENT AT THE TOP OF PAGE 2. THE MOTION PASSED WITH A VOTE OF 6 FOR AND 0 AGAINST(3 ABSENT— DWYER,LUNDBERG AND STEWART). COMMUNICATIONS a. Business from the Audience b. Correspondence Mr.Tamulonis discussed a letter from Lane County Tax Assessor Jim Gangle. Mr. Gangle recertified the total taxable assessed value within the Glenwood Urban Renewal Plan as being $106,986,910. That is about$2M more than last time the Board looked at the amount. Mr. Tamulonis said this amount would be the base value. Mr.Tamulonis distributed an exempt document from City Attorney Joe Leahy regarding Bonded Indebtedness. Each Board Member silently reviewed the document. Mr. Leahy gave a brief explanation of this memo. He said it spoke to termination of the Urban Renewal Agency. He said there was no danger of termination as long as there was debt,and there may be no danger when there was no debt for a period of time. The memo was for informational purposes only. Councilor Ballew gave an example of debt paid off earlier than expected and asked for clarification. Springfield Economic Development Agency Minutes July 25,2005 Page 2 Discussion was held regarding pay-off of the debt and when additional debt would be incurred. Further discussion was held regarding the term of the Urban Renewal Agency. Mr.Tamulonis said if the Urban Renewal Agency were to change the Plan,it would need approval by the voters. c. Business from the Staff REPORT OF CHAIR REPORT OF COMMITTEES Board Member Leiken said the financial institution he worked for had a client that owned property in Glenwood. He also noted that he was directly working with someone with a prospective interest in Glenwood. Mr. Leahy said it may not be an issue,but to be cautious he would recommend Board Member Leiken recuse. It may be that there were enough property owners in Glenwood that it wouldn't be a problem following his declaration,but he recommended checking further into it. Board Member Leiken recused himself from this portion of the meeting. OLD BUSINESS a) Discussion of City/SEDA Cooperation Agreement. SEDA is an independent agency under state laws with an interest in having general and specific functions done through an agreement with the City of Springfield.The character and extent of the relationship is in a key intergovernmental agreement between the two organizations. Since the previous discussion with the SEDA Board on May 9th and June 27th, 2005, staff has a draft agreement from SEDA to review,modify,and eventually approve for the City of Springfield to consider. Staff has discussions with expert individuals regarding renewal agencies and the character of agreements that define similar relationships elsewhere. In discussions on May 9,2005,the SEDA board provided staff with additional guidance on the items that might be included in a cooperation agreement.In working on the draft agreement, however,additional information from experts regarding other urban renewal agencies suggested a slightly more basic document that establishes the framework for long-term cooperation between an urban renewal agency and its authorizing City Council.A more basic document also permits more flexibility for the lengthy period of the urban renewal plan to adjust the detailed operational arrangements without having to redefine and modify the essential character of the agreement between the two organizations underlying the purpose of the urban renewal plan. Operational details can be modified and adjusted as conditions change,while the underlying character remains in place. An initial draft agreement would come to the SEDA Board for review,needed modifications,and possible forwarding to the City of Springfield for an August 1,2005 City Council meeting,the last council meeting before its summer recess. This agreement had been reviewed by 011ie Norville, former staff attorney for Portland Development Commission. Mr. Leahy noted that following the review by Mr.Norville,Mr. Leahy sent this agreement to the city's bond counsel in Portland for informal review. The bond counsel provided some • Springfield Economic Development Agency Minutes July 25,2005 Page 3 suggestions some of which were incorporated in the amended Section 5 which was distributed by Mr.Tamulonis. Mr.Tamulonis said the plan was referred to when making this agreement. He said the amended Section 5 that would be inserted into the agreement before it was finalized. He explained the amendment to this section. Board Member Ralston asked who kept track of the debt incurred. Mr.Tamulonis said part of the SEDA budget included city services such as financial services to track those types of transactions in a separate portion of the city's budgetary system. Board Member Ralston discussed payments to the city by the SEDA. Mr.Tamulonis discussed payment back to the city and the amounts that would come to the city and other agencies after the district was terminated after twenty years. Board Member Ballew asked Mr. Leahy about the agreement, Section 1, on page 2. She read that section and asked if that was what Mr. Leahy had explained earlier. Mr.Leahy said it was not. His earlier explanation related to the document he distributed and that was related to the entire agreement because of the interpretation from State Statute ORS 457 on termination of the agency when the debt was gone. Mr.Kelly explained further this issue. Mr.Tamulonis said the paragraph referred to by Board Member Ballew referred to the Urban Renewal Plan. Discussion was held regarding the amount of tax increment fmancing the district could receive, which was limited. Any excess amount would go to the other taxing agencies. If the total amount of financing was used up and paid back prior to the twenty years,the agency would terminate or another vote would need to be taken to allow more debt and tax increment financing. Board Member Ballew discussed the section that related to subordinating any loans. Mr. Leahy said requests would probably be made and the SEDA Board would need to make that decision. Further discussion was held regarding subordinating loans. Mr.Tamulonis said paragraph one was well suited to the Urban Renewal Agency. Mr.Leahy said staff would bring a clearer explanation regarding this issue to the council. Board Member Ballew discussed Section 8. She had a concern about the statement that the city agreed to provide proper public services to properties located in the Urban Renewal District. She said there could be a point where the cost of services exceeded the amount of tax increment financing or other financing. The rest of the city would then be asked to subsidize services and maintenance within the urban renewal area. She suggested that at some point that cost of city Springfield Economic Development Agency Minutes July 25,2005 Page 4 services be calculated on an annual basis and become a pass-through tax increment financing to the city. Mr.Tamulonis said the services could possibly be calculated,but payments through the tax increment financing may not be possible. He said other ways to cover the costs would be explored. Board Member Fitch gave an example regarding the proposed bike path. Mr.Tamulonis said the Urban Renewal Agency would try to build the infrastructure the city needed for long term development in Glenwood. The city would end up acquiring that asset as a public entity. Mr. Leahy suggested agreeing to the subordination for bonding,but agreeing to the subordination of other debt only after approval. Board Member Ralston discussed the cost of services and if it could be calculated into the amount of debt. Staff would find the answer to that question. Mr.Tamulonis said another opportunity might include acquiring property and leasing it out. That income could be offsetting some of the operational costs,but the tax increment income could not. IT WAS MOVED BY BOARD MEMBER BALLEW WITH A SECOND BY BOARD MEMBER WOODROW TO APPROVE THE CITY/SEDA COOPERATION AGREEMENT. Board Member Stewart arrived at 6:52pm and reviewed the agreement. IT WAS MOVED BY BOARD MEMBER BALLEW WITH A SECOND BY BOARD MEMBER WOODROW TO AMEND THE AGREEMENT BY ADDING LANGUAGE THAT SUBORDINATION IS CLEAR FOR BONDING PURPOSES,BUT FOR OTHER INDEBTEDNESS IT MUST BE APPROVED BY THE COUNCIL AND SEDA BOARD (SECTION 1);THAT COST FOR SERVICES IN EXCESS OF THE FROZEN TAX BASE WOULD BE ACCOMODATED BY THE AGENCY SUBJECT TO THE MUTUAL SATISFACTION OF THE CITY AND SEDA(SECTION 8); INCLUDE THE ADDITIONAL LANGUAGE IN SECTION 5; REMOVE THE TITLES UNDER SECTION 12 AND 13, "INDEMNIFICATION'AND"STATUS"; AND TO CORRECT THE TYPOGRAPHICAL ERROR UNDER RECITAL D TO HEALTH AND SAFETY. THE MOTION PASSED WITH A VOTE OF 6 FOR AND 0 AGAINST(2 ABSENT—DWYER&LUNDBERG, 1 RECUSED— LEIKEN). Mr. Leahy noted that the agreement had been sent to Steve Vorhees, legal counsel for Lane County. Board Member Stewart could contact Mr.Vorhees with questions. IT WAS MOVED BY BOARD MEMBER BALLEW WITH A SECOND BY BOARD MEMBER PISHIONERI TO ADJUST, SIGN AND FORWARD THE AGREEMENT TO THE CITY COUNCIL FOR CONSIDERATION AT THEIR AUGUST 1 MEETING. THE MOTION PASSED WITH A VOTE OF 6 IN FAVOR 0 AGAINST(2 ABSENT—DWYER& LUNDBERG, 1 RECUSED-LEIKEN). Springfield Economic Development Agency Minutes July 25,2005 Page 5 NEW BUSINESS RESOLUTIONS ADJOURNMENT The meeting was adjourned at 7:04 pm. Minutes Recorder—Amy Sowa Christine Lundberg Secretary