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Minutes 02-12-08 MINUTES OF THE COMMUNITY REDEVELOPMENT AGENCY BOARD HELD ON TUESDAY, FEBRUARY 12,2008, AT 6:30 P.M. IN THE COMMISSION CHAMBER IN CITY HALL, BOYNTON BEACH, FLORIDA PRESENT: Jerry Taylor Chair Jose Rodriguez, Vice Chair Ron Weiland Woodrow Hay Lisa Bright, Executive Director DJ. Doody, Board Attorney ABSENT: Marlene Ross I. Call to Order Chair Taylor called the meeting to order at 6:31 p.m. II. Pledge to the Flag and Invocation The invocation was given by Mr. Hay followed by the Pledge of Allegiance to the Flag. III. Roll Call The Recording Secretary called the roll. A quorum was present. IV. Agenda Approval: A. Additions, Deletions, Corrections to the Agenda Vice Chair Rodriguez requested the issue of MBOs (Management By Objectives) be added to the agenda. It was decided it Would be heard under X. Old Business. Mr. Weiland requested the Board Attorney give updates on the Martin Luther King Boulevard negotiations as well as and Ocean Breeze Report. B. Adoption of Agenda Motion Mr. Hay moved to approve the agenda as amended. Vice Chair Rodriguez seconded the motion. The motion passed unanimously. 1 Meeting Minutes Community Redevelopment Agency Boynton Beach, FL February 12, 2008 V. Announcements &. Awards: A. Heritage Festival Kathy Biscuiti, Special Events Coordinator, announced the Hester Center activities for the Heritage Celebration including a basketball tournament, laser tag, art exhibits, video game bus, continuous stage entertainment and a lot of family fun. The events would run from 11 a.m. to 11 p.m. The entertainment would include cheerleaders, rappers, spotlight performers and jazz performers. On Saturday, February 23, 2008 there would be a free concert featuring the Commodores on Ocean Avenue from 7 p.m. to 10 p.m. Ms. Biscuiti invited everyone to attend. Mr. Hay remarked there was excitement in the air in the community. The event was being widely talked about. Vice Chair Rodriguez brought up the fact that too many unknown people were in the VIP tent at the last event. Ms. Biscuiti agreed and advised the situation would be changing and a list of invitees would be distributed. Mr. Weiland advised he would be unable to attend. Chair Taylor commended the CRA, sponsors and City staff who worked together to bring about the Heritage Celebration. B. Housing Leadership Council of Palm Beach County - Workforce Housing Achievement Award for Outstanding Innovation & Leadership in Our Community. Ms. Bright displayed the Workforce Housing Achievement Award that had been presented to the Boynton Beach CRA for outstanding innovation and leadership on workforce housing. She read a letter from the Housing Leadership Council of Palm Beach County congratulating the City of Boynton on their extensive efforts in implementing workforce housing. Ms. Bright also introduced the new members of the CRA policing program. The officers came forward individually and introduced themselves and gave a brief description of their extensive backgrounds in law enforcement. They were all looking forward to the challenge. Chair Taylor fully supported the police and the goal of making the downtown safe for all the citizens of Boynton Beach. Mr. Hay concurred with Chair Taylor's remarks. Vice Chair Rodriguez noted monthly reports would be forthcoming from the patrols. In regard to the award for workforce housing, Chair Taylor noted he, as well as Mr. Hay and Ms. Ross, had attended the award luncheon and were proud that Boynton Beach was considered to be on the cutting edge by being proactive and leading the way. VI. Consent Agenda: A. Approval of the Minutes - CRA Board Meeting - January 8, 2008 B. Approval of the Period-ended January 31, 2008 Financial Report 2 Meeting Minutes Community Redevelopment Agency Boynton Beach, FL February 12, 2008 C. Approval of Board Member Travel to the 2008 Council of Development Finance Agencies (CDFA) Annual Spring Conference D. Approval of Funding $50,000 from the Homebuyers Assistance Program to Chantale Jacques E. Dumpster Art Program Update (Info. Only) F. Transit Oriented Development (TaD) Site Federal Funding Opportunities (Info. Only) G. Boynton Beach CRA and Trolley Website Update (Info Only) H. Approval of Tri-Party Agreement between the CRA, Hedrick Brothers and the Homeowner Motion Mr. Hay moved to approve the consent agenda. Mr. Weiland seconded the motion. The motion passed unanimously. VII. Pulled Consent Agenda Items: No items were pulled for discussion VIII. Public Comments: Mark Karageorge, 240A Main Boulevard, commended Chair Taylor as Mayor and spearheading the workforce housing initiative and the CRA efforts with the Preserve development. Mr. Karageorge was particularly impressed with the tremendous amount of work that was being done by the board that also sat as the Commission. Chair Taylor appreciated Mr. Karageorge's remarks but stressed it was the efforts of everyone that resulted in the award and the ordinance. It was a total team effort. No one else coming forward, Mayor Taylor closed the public audience. IX. Public Haring Old Business: None New Business: None X. Old Business: a. Consideration of Renewing CRA lease with Boynton Waterways Investment Associates, LLC. Vivian Brooks, Assistant Director of CRA, explained when the prior finance director made the lease there were no taxes on the property. Once the business was established, it became taxable and assessed at its own market value of $lM. The tax bill was $28,000. The lease could be renewed at the current rate of $600 a month leaving a shortfall. The options were to renew the lease at $600 a month for a one-year term, renew the lease for an additional year 3 Meeting Minutes Community Redevelopment Agency Boynton Beach, FL February 12, 2008 with no profit and the third option would be not to renew the lease. The property currently has an $8M public incentive on it. Michael Weiner, counsel for Boynton Waterways and on behalf of the Promenade, expressed his appreciate of the CRA support. He advised the media market was on life support and there had been no sales in the last month. They did pay trailer fees to the City and only rented the land. Many other projects in the area were generating a negative cash flow. If the rent were doubled it would be difficult. Land values are down and rents are down. He requested the board share the pain and was willing to work with the CRA and City. The length of time the lease would need to be extended was discussed and it was anticipated more than one year would be necessary. It was suggested the taxes were a cost of doing business and having a sales office. Perhaps the CRA should have been more proactive in leasing the space and done a better job planning. The developer was now being caught off guard. The money was available to pay the taxes. Ms. Brooks suggested taking the amount that is being subsidized and cut it from the incentive at the conclusion of the project. Mr. Weiner admitted the cash flow was difficult. Ms. Bright suggested the matter be tabled to give Ms. Brooks and the developer time to negotiate the alternatives. Motion Mr. Weiland moved to table Item X.A. Mr. Hay seconded the motion. The motion passed unanimously. b. Consideration of Splashdown Dive Shop Lease Extension There is currently a lease with Splashdown Dive Shop; however, the marina plan is not final and the shop will be renovated at a future date. It must have a lease in place to keep certification and another ocean program current. Staff was recommending a one year lease extension until permanent decisions could be made. Chair Taylor opened the issue for public hearing. No one came forward. Chair Taylor closed the public hearing. Ms. Bright explained the taxes had been reduced and were very low as a public entity. The lease is $2,800 a month. Ms. Brooks noted the property has a public access easement and could not be developed as a tax basis. Vice Chair Rodriguez noted exterior improvements had been made. Motion Mr. Weiland moved to approve Item X.B. Mr. Hay seconded the motion. The motion passed unanimously. c. Consideration of Renewing the CRA office lease. Ms. Bright reported the construction plans and drawings were submitted and the goal was to get the 211 Ocean Avenue project completed before the lease expired. Vice Chair Rodriguez 4 Meeting Minutes Community Redevelopment Agency Boynton Beach, FL February 12, 2008 questioned how the rate compared in the market. A market rate analysis had been prepared and it would be provided. The owner had requested an increase that Ms. Bright refused. Motion Vice Chair Rodriguez moved to approve Item X.c. Mr. Hay seconded the motion. The motion passed unanimously. d. Consideration of Providing Additional HAP Funds for Myrtle Marshall Ms. Bright announced Ms. Octavia Sherrod, Manager of Community Improvement had authorized other funding for Myrtle Marshall. The item would not need to be considered as an opportunity for the CRA. Mr. Hay requested confirmation that every effort would be made so Ms. Marshall would not be required to make any substantial contribution. Ms. Sherrod assured Mr. Hay there was a small amount of money she would be responsible to pay; however, everything was under control. It was a win/win situation for everyone. Disputes with previous contractors were being resolved and new contractors were available. Chair Taylor stressed the issue was no longer a consideration for the CRA. e. Discussion on MBOs (Management by Objectives) (This item was added to the agenda by Vice Chair Rodriguez.) Vice Chair Rodriguez explained he wanted to bring the issue back before the board for clarification on the eight objectives. He submitted information on why it was important to be developed by the CRA and provided to the Executive Director in advance. It was in her contract that an evaluation be done. He hoped it could be completed by next month. Chair Taylor noted there was performance criteria that had been used the past year when it was established a MBO type process would be better; however, it was never established. It was too late in the year to proceed. Vice Chair Rodriguez suggested the methodology could be split for the year. Chair Taylor had experience with a MBO process and was not sure it was appropriate for the Executive Director position. He supported using the system from the previous year, but not has staff do evaluations of the Executive Director. His reasoning was working with development involved projects over long periods and from year to year. Mr. Hay concurred and indicated his experience was the MBO method did not accommodate projects extending from year to year. Mr. Hay would support any decision; however, he felt the objectives had not been established early enough for evaluating this year. Mr. Weiland offered his thought that flexibility was important in any system as well as accountability. Motion Mr. Hay moved to abolish the MBO evaluation for the Executive Director at this time. Mr. Weiland seconded the motion. The motion passed unanimously. XI. New Business: A. Consideration of Designating the CRA a Brownfield 5 Meeting Minutes Community Redevelopment Agency Boynton Beach, FL February 12, 2008 Ms. Brooks reiterated the current market is difficult, resulting in more pressure on the CRA to offer more incentives. Her research found a brownfield designation would be helpful for areas that mayor may not have pollution, but has the appearance, and makes it unattractive to the private sector for investment. Environmental assessment can be costly as well as the clean up costs if pollution is found. Currently there are three locations that have encountered pollution and cleanups. The entire CRA area could be designated a brownfield. The Federal government now allows deductions for environmental cleanup costs that assist with operating expenses. The State brownfield incentives include $2,500 job bonus per new job site, loan guarantees, tax credits for the costs and a sales tax credit on building materials. Also cleanup liability protection is a major issue for lending institutions. There is no expense to the CRA or the City. Ms. Bright reported $70M to $75M of incentive dollars are not used annually. It has been the recommendation of the economic research firm and the downtown master plan to seek out this type of incentive and remediate this type of problem for the developers. The only negative is the perception of the residents, not the reality of the incentive. Motion Mr. Weiland moved that the City move forward with designating the CRA as a brownfield. Mr. Hay seconded the motion. The motion passed unanimously. B. Consideration of Entering into a Subordination Agreement with LISC on Behalf of the BBFBCDC (Boynton Beach Faith Based CDC). Ms. Brooks pointed out there were three homes along Sea crest that the CRA had purchased to assure the homes are built to specific standards. The agreement entered into by the CDC with a non-profit lender (LISe) requires the agreement for the right of reverter clause. Linda Charles, Senior Loan Officer for LISC advised the loan had been approved in October, 2007 with the condition that the development agreement is subordinate to the first mortgage. The paperwork is completed and the project is in position to proceed. Motion Mr. Hay moved to authorize the Chair to execute the subordination agreement. Vice Chair Rodriguez seconded the motion. The motion passed unanimously. C. Residential Improvement Program (RIP) Analysis Ms. Bright reported the RIP had been removed from the web site, but has now been revised and again appears on the website. A mailing was also being prepared advising that only exterior changes would be available through the program. The budget had included $300,000 with $140,000 having been spent. It could be increased by $40,000 so that 10 homes would benefit from the funding. The funds would come from the contingency monies. Chair Taylor recalled the program had been extended to outside the HOB area. 6 Meeting Minutes Community Redevelopment Agency Boynton Beach, FL February 12, 2008 Vice Chair Rodriguez indicated there was confusion with the information he had received previous to the meeting. Ms. Bright admitted the information she had previously provided was inaccurate. The corrected parameters were posted on the website after the January 8, 2008 meeting as directed by the board. The maximum amount is $20,000 per home for exterior renovations. Vice Chair Rodriguez expressed his concern that the board should receive accurate information from the Executive Director in a timely fashion. Motion Vice Chair Rodriguez moved to move forward with the residential improvement program as approved at the workshop and increase the budget by an additional $40,000. Mr. Weiland seconded the motion. Mr. Hay sought assurance that the action would not delay the program and it was confirmed the program would move forward for both the previous applicants and new applicants. Ms. Bright clarified the original program was out of bond II proceeds which was an affordable access $12M bond, issued to the public, sold at market. The bond required that any funds from the bond go to the HOB. The funds from bond II were depleted and further funding came from the general fund that is shared by HOB. The program was then extended district wide and approved by the CRA board on October 9, 2008. The motion passed unanimously. D. Consideration of Ocean Breeze RFP - Unit Mix Changes Chair Taylor explained the request to do less two bedroom and more three bedrooms due to market conditions. Mr. Weiland asked if the ratio of rental to "for sale" would be changing. Ms. Bright responded the request was for "for sale" product. Chair Taylor was concerned with the language of the request for future and ongoing modifications of the unit mix without board approval. Ms. Bright replied she had requested the realtor bring any changes back to the board. Attorney Doody advised the motion should be very specific. Motion Based on the suggested language of Attorney Doody, Mr. Weiland moved to approve the revised unit mix as reflected in the correspondence from American Reality Development dated January 28, 2008, identifying the fact that the two bedroom unit type would be 16 and the three bedroom unit type would be 40 units. Chair Taylor asked to add that any other variation would have to come back to the board. Vice Chair Rodriguez suggested the change be exclusive. Attorney Doody indicated either approach would be acceptable. Mr. Weiland moved to approve as amended. Vice Chair Rodriguez seconded the motion. A substitute motion was offered. 7 Meeting Minutes Community Redevelopment Agency Boynton Beach, FL February 12, 2008 Motion Vice Chair Rodriguez moved to approve the changes in the size of the condominiums exclusively to those outlined in the recommendation. Mr. Weiland seconded the motion. The motion passed unanimously. E. Consideration of a Request for Qualifications Process for Master Developer for Town Square Ms. Bright reported it had been suggested at the last meeting that staff work on an RFP or RFQ for a larger development area for the Town Square plan. At the present time, it would require both CRA and City staff to draft a request for candidacy or request for proposal. She requested the board allow CRA staff to commence discussion with the City to ultimately come back with a request for proposal for a larger development site known as the Town Square Plan. The downtown master plan would be considered by the board next month and go to the Commission in April. The intervening sixty days would give staff ample time to create the required requests. Attorney Doody concurred the processes should be pursued concurrently. Motion Vice Chair Rodriguez moved to approve the RFQ process for the master developer, contingent upon the approval of the downtown master plan, and can be released simultaneously. Mr. Hay seconded the motion. The motion passed unanimously. F. Potential CRA Commitment to City Capital Improvement Program (CIP) Ms. Bright had been made aware that the City's CIP included a reimbursement by the CRA in October 2008 of $2.3M with the subsequent year of $8.3M for the Public Works site. The CRA was not privy with those discussions. The CRA had not publicly discussed any intent with the Public Works site since December 2005. She had brought it back to the board seeking direction from the current board and Legal, on any necessary action to be taken. Chair Taylor offered that it was premature since no new site was available. The City Manager also indicated the Commission could remove it from the CIP. Mr. Weiland agreed. Ms. Bright agreed with Vice Chair Rodriguez that the monies pledged would factor into the purchase of City properties with the MLK corridor and the availability of funding for both. Attorney Doody advised the City's adoption of a budget would not be operative on the CRA without the CRA authorization. Ms. Brooks indicated it was an unfunded mandate. Motion Vice Chair Rodriguez moved that the issue be brought to the City Commission for evaluation and decision. Mr. Weiland seconded the motion. The motion passed unanimously. G. Consideration of Purchasing City Properties Within the MLK Corridor 8 Meeting Minutes Community Redevelopment Agency Boynton Beach, FL February 12, 2008 Ms. Bright advised the City Manager had indicated at the February 5, 2008 Commission meeting that he would be a primary lead in seeking the appraisals for the City's parcels. Ms. Bright needed direction from the board to do some of the exchanges and swaps. The CRA should do appraisals on their properties along Sea crest Boulevard so arms length transactions could be discussed and ultimately returned to both boards for approval. Mr. Weiland maintained that both sides should seek appraisals for the purpose of negotiation on all properties. Vice Chair Rodriguez contended if there were an agreement that the agreed upon appraisal would be accepted, there would be no need for negotiation. Attorney Doody noted he appreciated the desire to save costs; however, to maintain the integrity of the separation of the entities, each entity should obtain their own evaluations to avoid even the appearance of collusion and create distance between the CRA and the City. It would remain an arms length transaction and the average could be utilized. Vice Chair Rodriguez stressed the appraisal would be from an independent third party. Discussion followed on the approximate cost of doing separate appraisals. Attorney Doody advised it was a commercial transaction and should be done within a strict business sense, dollar for dollar, for the properties, with a value to be gained by both the CRA and the City that would be justified by the appraisals. Vice Chair Rodriguez continued to express concern with the cost that would be incurred. Ms. Bright agreed to advise the board by email of the estimated cost or it could be brought back before the board if the cost would exceed $20,000. Motion Mr. Hay so moved that the City and CRA have separate appraisals and also that if the cost exceeded $20,000, it comes back to the board. Vice Chair Rodriguez seconded the motion. The motion passed unanimously. XII. Future Agenda Items None XIII. Comments by Staff No comments were offered. XIV. Comments by Executive Director Ms. Bright responded to Mr. Weiland's request regarding the MLK negotiations. Auburn Group was not satisfied with the draft from their attorney. Weekly negotiations had commenced to agree on the business terms with the joint goal to have an agreement presented to the CRA board for the April meeting. With regard to Ocean Breese, the deadline had been met for CWHIP (Community Housing Workforce Innovation Program) Funding and Federal Housing Finance Corporation and waiting for a response. 9 Meeting Minutes Community Redevelopment Agency Boynton Beach, FL February 12, 2008 Frank Chirkinian, 625 Casa Loma Blvd, representing American Reality, expected preliminary scores from the Federal Housing Finance Corporation by February 28, 2008 would provide feedback on any deficiencies. On March 30, 2008 the final rankings would be given and on May 12, 2008 the board would approve those rankings. If the funding were approved it would be 30 days for the credit underwriting process to commence, taking four to six months before closing. Hopefully ground could be broken during the first quarter of next year. Site plan approval and mix of units were being discussed simultaneously to move the project forward. XV. Comments by CRA Board Attorney No comments were offered. XVI. Comments by CRA Board Chair Taylor suggested a small fund be established to assist neighborhood organizations with the expense of meeting locations. The Boat Club Park could be used for $35 per hour. Mr. Hay was concerned many other organizations would want the same benefit. Mr. Weiland contended parameters would need to be established. Chair Taylor indicated it could be done on a case-by- case basis if it had to do with revitalization. Vice Chair Rodriguez suggested the Sims Center be considered also. Mr. Hay noted many organizations want to meet within their own local area. Chair Taylor noted it could be funded from unobligated dollars. There was consensus that direction be given to the Executive Director to come back with information on where to allocate the funds and put a line budget for this type of expense in the budget. XVII. Adjournment There being no further business to come before the board, Chair Taylor properly adjourned the meeting at 8:33 p.m. Submitted by: &/ct/t;b1~ dith A. Pyle {j/ , Deputy City Clerk 10