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HomeMy WebLinkAbout1992-09-02 EURA MINUTESI • I. NGLEWOOD URBAN RENEWAL AUTHORITY SEPTEMBER 2, 1992 CALL TO ORDER. The regular meeting of the Englewood Urban Renewal Authority was called to order by Chairman Totton at 5: 35 P. M. Members present: Schmidt, Whatton, Waggoner, Totten Harold J. Stitt, Acting Executive Director Members absent: Minnick, Byrne, Smith n. APPROVAL OF MINUTES July 1, 1992 Mr. Totten called for approval of the Minutes of July 1, 1992. Mr. Smith and Ms. Byrne entered the meeting and took their seats with the Authority. Waggoner moved: Whatton/Schmidt seconded: The Minutes of July 1, 1992 be approved as written. AYES: NAYS: ABSENT: ABSTAIN: Whatton, Byrne, Schmidt, Smith, Waggoner, Totten None Minnick None The motion carried. ID. REVENUE REPORT Mr. Stitt stated that the August sales tax revenues are not indicated on the latest printout, but that the August property tax revenues are. Year-to-date revenues from property tax is $779,036.24 compared to $496,577.23 in 1991 at this time. Sales tax revenues total $714,384.26 through July, compared to $479,647.47 in 1991 through July. Mr. Stitt stated that Arapahoe County projections on property tax indicate a possible $40,000 to $50,000 in additional revenues for the remainder of the year. Discussion on the former Best Buy store ensued. Mr. Totten pointed out that it may be used for warehousing at the present time for other Best Buy stores. Mr. Stitt suggested there may be a possible increase in sales tax revenues because of the back- to-school shopping. It was pointed out, however, that the publicity regarding Cinderella City and Phar-Mor may have a negative impact on expected revenues. IV. LEGISLATION UP-DATE Mr. Stitt reported on a recent meeting of the CML/CCRA, which he attended. This meeting was to consider proposed new legislation pertaining to the Urban Renewal Authority statutes. Mr. Stitt reviewed previous discussions and proposals which were instigated by a group of bondholders through Senator Powers. It was their intent to extend terms of tax increment 1 financing districts from 25 years to 35 years, or to remove the time limitation completely. A Mr. Stitt stated that this issue will arise again, but at this time the form the proposed W legislation will take is not known. It is the feeling of the Colorado Municipal League that it would be to the benefit of the various communities and authorities to propose the revised legislation rather than letting the bondholders do it. He stated that the CML/CCRA will probably propose the new legislation, and present it to the bondholders; they seemed to be of the opinion that the bondholders would be supportive of the proposal. However, the big question was whether the City of Englewood would be supportive. Mr. Stitt stated that the CML represents all member communities in legislative matters, and if a member community is in opposition to a proposal, it puts the CML in an awkward position. Mr. Stitt stated that at the present time, sales tax revenues pledged to bond repayment can be extended at the pleasure of the individual City Council if it is a Home Rule City. Property tax pledge terms, however cannot be extended without State legislation allowing this extension. Mr. Stitt stated that representatives from various brokerages indicated that amendment of URA statutes to remove time limitation on bond issues would probably be a positive step. If something is introduced in the State legislature, it probably will not have a time limitation at all, but will leave it up to each jurisdiction to establish the length of time the tax increment financing would last for a particular bond issue. Mr. Stitt stated that there has been lots of bad press about the defaults by a number of special districts, and that there has been no new tax increment bond issue since 1986. He stated it is his understanding that Northglenn has formed an Urban Renewal Authority to undertake the redevelopment of the Northglenn Mall, but that no bonds have been issued to this date. Mr. Stitt also pointed out that bond issues are handled differently state-by-state. Mr. Totton inquired about Industrial Development Bonds --is there a limited amount issued in the state. Mr. Stitt stated that he could not answer on the methods of allocation of IDBs. Mr. Stitt pointed out that there are some issues which can affect any proposed legislation on TIF bonds. One is the sales tax issue for schools, and another is the proposed Bruce amendment. Mr. Stitt pointed out that even if the time limits were to be eliminated through new legislation, the Englewood City Council would still have to amend the Downtown Redevelopment Plan (Urban Renewal Plan) to effectuate this new legislation. Mr. Stitt acknowledged that this does put the City Council in an awkward position, and the City is in a "no-win situation": if they do not amend the Plan to effectuate the time limitation removal , the bondholders will be displeased, yet the City is not financially able at this time to approve the removal of the time limitation. No one knows what the financial situation of the City may be in the future. v. TRUSTEE EXPENDITURES Mr. Stitt stated that at the last meeting he was asked to get information on the "expenses" incurred by the Trustee which expenses are being paid from revenues pledged for bonds. He distributed this information to the members of the Authority. To date, the Trustee has had $41,979.87 in "expenses" since the bonds went into default on June 1, 1991. With the exception of $7,500 payable to Central Bank for "default fees", the remainder appear to be for "legal fees". Discussion ensued. Mr. Smith inquired whether we could expect this as an "average" amount. Mr. Stitt stated that he could not say at this time. Mr. Smith commented that these "expenses" 2 are deducted from revenues that are pledged for repayment of bonds. He suggested that the EURA be very attentive to the fees charged by the Trustee, and reminded the Authority that it is in our best interest to get the bonds paid off as soon as possible. Further discussion ensued. Ms. Byrne asked if the Authority could inquire what the expenses are up-front, and have the right of approval. Mr. Stitt stated that the EURA has no rights on approval or disapproval of expenses. He pointed out that bondholders can ask for justification of the expenses. Ms. Byrne inquired about dissolution of the EURA, which she understood was being considered by City Council. Mr. Stitt stated that if the EURA is dissolved, the City Council would assume this responsibility, but i t will also remove the "arm's length" relationship between the City and the Authority. He suggested that Council is probably not interested in modifying this relationship. Brief discussion ensued. VI. 1991 FINANCIAL REPORT Mr. Stitt discussed the 1991 Financial Report (Audit) with members of the Authority. He asked if members had any questions on the document; he will get clarification from the Finance Department on issues that the Authority questions. Mr. Stitt referred the attention of the Authority to the last page of the Audit regarding a debt service budget. Discussion ensued . Waggoner moved: Smith seconded: AYES: NAYS: ABSENT: ABSTAIN: The motion carried. The Englewood Urban Renewal accept the 1991 Audit, as prepared by Van Schooneveld & Co., Inc. Byrne, Whatton, Waggoner, Schmidt, Smith, Totton None Minnick None VII. PUBLIC FORUM There was no "public" present. VIII. DIRECTOR'S CHOICE Mr. Totton inquired when the new Director of Community Development will begin. Mr. Stitt stated that Mr. Lee Merkel will begin employment on September 14 or 15 as the Director of Community Development. The person in this position has previously also served as the Executive Director of the EURA. He suggested that there will probably be a meeting of the Authority on October 7 to introduce Mr. Merkel to the Authority. IX. COMMISSIONER'S CHOICE Mr. Smith inquired about Cinderella City. Mr. Stitt stated that the Mall owners are apparently not in a financial position to do any improvements to the Mall at this time. The only way a friendly condemnation can work is if there is a developer with money in-hand ready to step in, because the City does not have the funds available. The Mall is quite large by today's stan- dards, and may have to be downsized to be functional; surveys need to be done to determine what market niche needs to be addressed. Mr. Totton stated that a the new Director, Mr. Merkel, will be quite involved in activities pertaining to the Mall. Mr. Stitt stated that an RFP has been or will shortly be prepared requesting that developers interested in the Mall submit proposals for redevelopment. 3 '· Mr. Smith suggested that "if you are going to do something, you need to push ahead and get it e done." He stated that he heard about the "friendly condemnation" on TV, but it appears that no further steps have been taken. Mr. Smith stated that he is in the development business, and knows that there are investors from California, Texas, and Japan who are investing in Colorado businesses. He stressed that the City needs to be more aggressive in pursuing the redevelopment of the Mall. Mr. Totton pointed out the importance of current market studies. Ms. Byrne stated that she would like to see a good mid-priced hotel in Englewood. Mr. Stitt stated that last market studies for hotels indicated the market just would not support a hotel in this immediate area. Mr. Smith discussed the redevelopment in Atlanta, GA. Mr. Smith further stated that in his opinion, Englewood has been too "laissez faire" to get a hotel in the city, and all the hotels have chosen to locate around the DTC, or east or west on U.S. 285. He stated that if Englewood "keeps spinning its wheels", it won't get any better. Mr. Totton stated that he has been very interested in attracting a hotel to Englewood. He also pointed out that whatever happens will have to come from a developer with money, and that construction money is very tight right now. He stated that he is also interested in attracting some first class eating places to the City; in his opinion, Englewood does not have any. Mr. Stitt distributed copies of a memorandum from Mr. DeWitt and an analysis of the proposed Bruce Tax Amendment. There was nothing further brought before the Authority. vL~~ ---Gefulide G. Welty / I Recording Secretary 4