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HomeMy WebLinkAbout2015-10-19 SEDA Meeting Minutes MINUTES OF THE MEETING OF THE SPRINGFIELD ECONOMIC DEVELOPMENT AGENCY HELD MONDAY OCTOBER 19,2015 The Springfield Economic Development Agency met in the Council Chambers,225 Fifth Street, Springfield,Oregon on Monday October 19,2015 at 7:32 p.m.,with Board Chair Sean VanGordon presiding. ATTENDANCE Present were Board Chair Sean VanGordon, Board Vice-Chair Sheri Moore and Board Members Marilee Woodrow,Christine Lundberg,Joe Pishioneri,Hillary Wylie and Dave Ralston. Also present were City Manager Gino Grimaldi,Attorneys Mary Bridget Smith and Lauren King,and City Recorder Amy Sowa. Board Member Leiken was absent(excused). APPROVAL OF MINUTES a. Minutes of July 13, 2015 IT WAS MOVED BY BOARD MEMBER WOODROW WITH A SECOND BY BOARD MEMBER PISHIONERI TO APPROVE THE JULY 13,2015 MINUTES.THE MOTION PASSED WITH A VOTE OF 7 FOR AND 0 AGAINST(1 ABSENT—LEIKEN). CCOMMUNICATIONS a. Business from the Audience -None b. Correspondence -None c. Business from the Staff-None REPORT OF CHAIR -None REPORT OF COMMITTEES -None PUBLIC HEARINGS-None NEW BUSINESS 1. Intergovernmental Capital Project Loan to Springfield Economic Development Agency: Franklin Blvd Improvement Project Phase 1. RESOLUTION NO. SEDA2015-05—A RESOLUTION AUTHORIZING INDEBTEDNESS FOR CAPITAL PROJECTS DESCRIBED IN THE URBAN RENEWAL PLAN FOR THE GLENWOOD URBAN RENEWAL AREA. Finance Director Bob Duey presented the staff report on this item. Springfield Economic Development Agency Minutes October 19,2015 Page 2 The Council has previously approved in the 5-Year CIP the capital project to improve Franklin Blvd within the Glenwood Urban Renewal Plan. Phase 1 of this project has already been initiated with expenses incurred for design work and right-of-way acquisition. The project budget and the Adopted Budget for FY 15 documented the need to borrow the required $3.6M match for Phase 1. The Springfield Economic Development Agency(SEDA)had included this borrowing as part of their adopted budget for FYI5 but subsequent decisions on the project concerning the application for the Tiger 7 grant has delayed the actual borrowing until this year. Staff is now recommending that the City proceed with completing the financing for Phase 1 by initiating a loan from the City to SEDA in the amount of$3,000,000. This loan would be paid back over a period not to exceed 10 years. This financing arrangement still allows for the possible $3.6M in external financing to able to be made available for Phase 2 if the Tiger 7 grant is received. IT WAS MOVED BY BOARD MEMBER WOODROW WITH A SECOND BY BOARD MEMBER PISHIONERI TO ADOPT RESOLUTION NO. SEDA2015-05. THE MOTION PASSED WITH A VOTE OF 7 FOR AND 0 AGAINST(1 ABSENT—LEIKEN). IT WAS MOVED BY BOARD MEMBER WOODROW WITH A SECOND BY BOARD MEMBER PISHIONERI TO APPROVE THE INTERGOVERNMENTAL AGREEMENT TO MAKE FINANCIAL PAYMENTS. THE MOTION PASSED WITH A VOTE OF 7 FOR AND 0 AGAINST(1 ABSENT—LEIKEN). 1. Authorization to Incur Debt for Franklin Blvd. Improvement Project Phase 2. RESOLUTION NO. SEDA2015-06—A RESOLUTION OF THE CITY OF SPRINGFIELD, OREGON AUTHORIZING FINANCING OF CAPITAL PROJECTS DESCRIBED IN THE URBAN RENEWAL PLAN FOR THE GLENWOOD URBAN RENEWAL DISTRICT. Finance Director Bob Duey presented this item. The City's decision to seek Tiger 7 matching funds for the Franklin Blvd Project Phase 2 has resulted in the combined match of the City for Phases 1 and 2 to increase from $3.6M to $9.6M. The award of the additional grant funds has not yet been determined but staff is recommending that action be taken by the Council at this time to put the financing plan in place so that if awarded in the near future the City will be more readily able to move into the grant award negotiation phase. To be able to fund the required $9.6M in matching funds for the combined project it will be necessary for the City to borrow$3.6M from an external source. This amount is the same as what the City had originally intended to borrow as part of Phase 1 but that requirement has now been met through internal resources. An Intergovernmental Agreement to Make Financing Payments between the City and SEDA will allow for the repayment of the loan with tax increment financing. If the Tiger 7 grant is not awarded to the City,the borrowing of any resources from this action for Phase 2 will be tabled. Board Member Wylie asked if inner-borrowing was good practice according to other Urban Renewal and City projects in other communities. Springfield Economic Development Agency Minutes October 19,2015 Page 3 Mr. Duey said it was not uncommon. They could send out a Request for Proposals(RFP)to banks,choose one and negotiate to get urban renewal as the primary loan agency, but they would have to pay interest rates and other costs. With the City being able to do this,we will get the best interest rate. We have faith in our urban renewal district for payback so there is no risk on the City's part. It allows SEDA to move forward. When dealing with debt for urban renewal districts, they have to have the increment taxes already in place,not what they will be after the investment. Each project that helps generate tax increment financing revenue helps finance the next project. Board Member Moore asked how much time until completion of the project that will bring in additional revenue. Mr. Duey said the Franklin Boulevard project will not bring in taxes, but will encourage development.They will start construction of Franklin Boulevard Phase I in 2016 and finish in 2017. Phase II would start during the next construction season. IT WAS MOVED BY BOARD MEMBER PISHIONERI WITH A SECOND BY BOARD MEMBER WOODROW TO ADOPT RESOLUTION NO. SEDA2015-06. THE MOTION PASSED WITH A VOTE OF 7 FOR AND 0 AGAINST(1 ABSENT—LEIKEN). IT WAS MOVED BY BOARD MEMBER PISHIONERI WITH A SECOND BY BOARD MEMBER WOODROW TO APPROVE THE INTERGOVERNMENTAL AGREEMENT TO MAKE FINANCING PAYMENTS. THE MOTION PASSED WITH A VOTE OF 7 FOR AND 0 AGAINST(1 ABSENT—LEIKEN). OLD BUSINESS -None. ADJOURNMENT The meeting was adjourned at approximately 7:40 p.m. Minutes Recorder—Amy Sowa Marilee Woodrow Secretary