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HomeMy WebLinkAbout1997-02-05 EURA MINUTES·. ENGLEWOOD URBAN RENEW AL AUTHORITY FEBRUARY 5, 1997 I. CALL TO ORDER. The annual meeting of the Englewood Urban Renewal was called to order at 5:35 P.M. in Conference Room A of Englewood City Hall, Executive Director Frank Gryglewicz presiding. Members present: Members late: Members absent: Also present: Havens, Graebner, Knuppertz, Roth, Weddle Gryglewicz, Executive Director/Executive Secretary Vormittag Soulliere Mark Graham, Neighborhood Community Coordinator Jesse Silverstein, consultant Il. EPA GRANT APPLICATION. Brownfields Pilot Program Mr. Gryglewicz asked Mr. Graham and Mr. Silverstein to present the proposal for discussion. Mr. Graham stated his position with the City of Englewood, noting that one of the functions of the Neighborhood and Development Department is economic development. This includes new development and redevelopment of sites that may have contaminated soil. Mr. Graham stated that he and Mr. Silverstein have worked together, written and submitted an application to the Environmental Protection Agency (EPA) for a $200,000 Brownfields Pilot Project grant. He and Mr. Silverstein would like to garner as much support as possible for this application, and will make presentations to the Greater Englewood Chamber of Commerce, the South Metro Chamber Economic Development Group , realtors groups , and other non-governmental organi- zations . Mr. Graham stated that there will be two rounds of funding , the first in March and the second in June , 1997. Mr. Vormittag entered the meeting and took his chair with members of the Authority. Mr. Graham stated that once initial funding is received, a task force will be formed and a member of the Authority may be asked to serve. Mr. Graham stated that the $200 ,000 grant, if received , will be used as seed money for a revolving loan fund. This loan fund will be used to assess and analyze contaminated sites; the funds may be borrowed by potential developers , and if the development occurs the funds are repaid at that time. If no development occurs , the 1 City will retain ownership of the information, and it can be made available to successive po- tential developers. Mr. Silverstein stated that "brownfields" are properties that are idle or unused because of soil contamination. There are sites where sale or redevelopment are stopped because of contami- nation. The City of Englewood has a large manufacturing community, and many sites may be impacted by environmental problems. Englewood is landlocked, and has extremely limited raw land to develop; thus, the need for redevelopment of sites that may have contamination. Many of these businesses were in operation before many substances were determined hazard- ous, and disposal methods were not as sophisticated as today. Twenty-three (23) sites have been identified as possible contaminated sites. Mr. Silverstein discussed the revolving loan fund. If the funding is granted, low-interest loans would be available, and repayment would occur only if redevelopment occurs. If redevelopment does not occur, the City will own the information developed during the analysis and assessment of the site, and it will be made avail- able to subsequent developers. Mr. Silverstein emphasized that we do not want to establish another "regulatory layer" of government, or to establish a "hit list" of contaminated sites. But the assistance should be available to developers interested in sites that may or may not be contaminated. Mr. Graham stated that if the $200,000 grant is received, a request will be made for matching funds from the City. Other prospects for grants will also explored and the hope is to have a revolving loan fund of approximately $500,000 available. Mr. Graham expanded on potential uses for the loan fund, covering issues such as environmental insurance as well as assessment and analysis efforts. Mr. Graham stated that two sites of particular concern are the General Iron site, and the Thomas Plating site. Remediation on either of these sites could run into sev- eral hundreds of thousands of dollars. Mr. Graham stated that it is the intent that the funds in the loan pool will be "recycled" -loaned out, repaid, re-loaned. Mr. Gryglewicz asked what ramifications this grant would entail as far as auditing expenses, reporting standards, etc. Mr. Silverstein stated that the Authority itself would not be exposed to additional auditing fees; the loan fund will be administered by the Office of Neighborhood and Business Development. Mr. Graham stated that the EPA will monitor the pilot project, and acknowledged there might be implications for the City Finance Department. Brief discussion ensued. Mr. Graham noted that remediation of contamination by gasoline or asbestos will not be covered. Mr. Vormittag inquired whether soil contamination by machine oil would be covered. Mr. Silverstein stated that would "probably" be covered. Mr. Graebner posed a hypothetical redevelopment of the General Iron site; would the contami- nants have to be removed prior to offering it for sale. Mr. Silverstein responded that initially, the site would have to be assessed and analyzed to determine contamination; then an engineer- ing analysis to determine if the contamination could be contained and removed. Mr. Silver- stein emphasized that this is a "pilot" program, and the initial funding is used to identify and assess contamination on sites. If the City makes it through the first part of the program and 2 t.• gets funded to perform assessment and analysis work, we would want to try to obtain addi- tional funding for the remediation work. Mr. Graham noted that the newly redeveloped site at 1-25 and South Broadway is a brown- fields site. Mr. Graham discussed the criteria of the pilot project, including creation of new jobs if the site is cleaned and redeveloped. Mr. Graham reiterated that the EURA is being asked to support the grant application. Mr. Graebner asked if there is any "down side" to the application. Are "matching funds" a requirement. Mr . Graham stated that matching funds is not a requirement, but if matching funds and support can be secured the application is viewed more favorably. Mr. Graebner asked if a letter of support from the Authority is being sought. Mr. Graham re- sponded affirmatively . He offered to draft such a letter for signature by Executive Director Gryglewicz. The Authority members accepted Mr. Graham's offer. The Authority thanked Mr. Graham and Mr. Silverstein for their presentation, and noted they were welcome to remain for the rest of the meeting. III. APPROVAL OF MINUTES. December 11, 1996 Mr. Gryglewicz stated that the Minutes of December 11, 1996 were to be considered for ap- proval. Vormittag moved: Graebner seconded: The Minutes of December 11, 1996 be approved as written. AYES: NAYS: Graebner, Havens, Knuppertz, Roth, Vormittag, Weddle None ABSTAIN: None ABSENT: Soulliere The motion carried. IV. ELECTION OF OFFICERS. Chair Vice-Chair Mr. Gryglewicz declared the nominations for Chair open. Vormittag nominated Mr. Havens as Chair. Mr. Graebner seconded the nomination. No fur- ther nominations for Chair were received. Nominations were closed, and Mr. Havens elected as Chair by acclamation. 3 Mr. Gryglewicz declared nominations for Vice-Chair open. Vormittag nominated Mr. Graebner as Vice-Chair. Mr. Havens seconded the nomination. No further nominations for Vice-Chair were received. Nominations were closed, and Mr. Graeb- ner elected as Vice-Chair. V. REVENUE REPORT. 1996 Year-end 1997 to-date Mr. Havens asked Executive Director Gryglewicz to present the revenue reports. Mr. Gry- glewicz noted a decline in property tax revenues in 1996 from 1995; however, sales tax reve- nues for 1996 were up over 1995. Mr . Gryglewicz suggested that the decline in property tax revenues could be from reassessment of properties. The 1997 to-date revenue report was reviewed. Mr. Gryglewicz noted that the sales tax reve- nues posted in January, 1997 are $265,095.93, up from $245,946.55 in 1996. Vormittag moved Havens and Weddle seconded: The Revenue Report for 1996 Year-end, and 1997 to-date be accepted as presented. AYES: NAYS : Roth, Vormittag, Weddle, Graebner, Havens, Knuppertz None ABSTAIN: None ABSENT: Soulliere The motion carried. VI. 1997 BUDGET. Mr. Gryglewicz stated that the Authority is required to submit a Budget to the Department of Local Affairs, State of Colorado. A budget has been prepared in the amount of $4,980. Ex- penditures in 1996 were $3,836.99. Mr. Graebner asked where the moneys for the expenditures come from. Mr. Gryglewicz stated that the funds for this budget will be taken from the General Fund. Graebner moved: Vormittag seconded: The 1997 Budget for the Englewood Urban Renewal Authority be ap- proved as presented. AYES: NAYS: ABSTAIN: Vormittag, Weddle, Graebner, Havens, Knuppertz, Roth None None 4 ABSENT: Soulliere The motion carried. VII. COMMISSIONER'S CHOICE. Mr. Vormittag welcomed Ms. Weddle, Mr. Roth, and Mr. Knuppertz to the Authority. He stated that he would like Executive Director Gryglewicz to brief new members on the status and activities of the Authority. Mr. Gryglewicz discussed the financial status of the Authority, which has been in default on repayment of the bonds since June, 1991. Meetings with several bond houses were held in 1996 to explore possible avenues to resolve the default. The trustee and their legal counsel have also met with the Authority. The bonds, as sold, were high risk, unrated, uninsured bonds with a high interest yield. Mr. Gryglewicz noted that many of the purchasers of the bonds were sophisticated buyers, but now want the City to make good on their speculative in- vestment. The Offering Statement and Indenture clearly state that the bonds are NOT an obli- gation of the City of Englewood. Mr. Gryglewicz stated that the redevelopment undertaken by the EURA was put together at a time when the economy was doing well, but a sudden down- turn impacted financing, willingness of businesses to test new markets, banks went under, and revenues never kept up with the repayment schedule. All revenues collected in the Tax Incre- ment District (TID) go directly to the Trustee for payment to the bondholders, but they are in- sufficient to meet the debt. Mr. Gryglewicz stated that the TID will expire in 2005, and no one knows what will happen at that time if the default is not cured. Mr . Gryglewicz further discussed options explored to cure default, including taking Bank- ruptcy, extending the period of the TIF, and refinancing the bonds. Mr. Gryglewicz com- mented that, in his opinion, the City Council will not approve extension of the tax increment financing. Mr. Graebner noted that it is not clear whether urban renewal authorities can go into bankruptcy. Mr. Gryglewicz stated that the Authority and the City, individually, signed tolling agreements in November, 1996, which agreement allows bondholders to retain their rights for one more year. These tolling agreements may be brought back in 1997 to be signed again. Mr. Gryglewicz stated that the City wants to make use of the Authority again, but so long as the default continues, this cannot be done. Mr. Vormittag noted that the Authority owns vacant land along Englewood Parkway, and in the 3400 block of South Acoma Street; if this property were to be sold the proceeds would go to the trustee to repay the bonds. Redevelopment of the property would also contribute tax revenues to the bondholders . Mr. Gryglewicz discussed the impact the TABOR amendment could have on refinancing or issuance of new bonds. The impact of the TABOR amendment on several financial issues that 5 have gone before the voters in the last few years was discussed. Mr. Vormittag discussed the need to "de-Bruce " the City . Members of the Authority gave a brief personal background sketch . Mr. Graebner excused himself from the meeting . VIIl. DIRECTOR'S CHOICE. Mr. Gryglewicz stated he had nothing to bring before the Authority. The meeting adjourned at 6 :45 P .M. lnbdlgroup\boards\uralmin97\euram 2-5-97.doc 6 ,,