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Minutes 11-13-12 MINUTES OF THE COMMUNITY REDEVELOPMENT AGENCY BOARD MEETING, HELD ON TUESDAY, NOVEMBER 13, 2012, AT 6:30 P.M. IN COMMISSION CHAMBER 100 E. B BEACH B B BEACH, FL PRESENT: Woodrow Hay, Chair Vivian Brooks, Executive Director Mack McCray, Vice Chair James Cherof, Board Counsel James "Buck" Buchanan Steven Holzman Mark Karageorge Marlene Ross (arrived at 7:05 p.m.) I. Call to Order Chair Hay called the meeting to order at 6:31 p.m. and announced Ms. Ross would be late. II. Invocation and Pledge to the Flag Mr. Karageorge gave the invocation and Vice Chair McCray led the Pledge of Allegiance to the Flag. III. Roll Call The Recording Secretary called the roll. A quorum was present. IV. Legal: None V. Agenda Approval: A. Additions, Deletions, Corrections to the Agenda There were no changes to the agenda. B. Adoption of Agenda Motion Vice Chair McCray moved to approve the agenda. Mr. Karageorge seconded the motion that unanimously passed. 1 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 VI. Informational Items and Disclosures by Board Members and CRA Staff: A. Disclosure of Conflicts, Contacts and Relationships for Items presented to the CRA Board on Agenda Items B. Informational Announcements Mr. Buchanan had no disclosures, but announced the Chamber of Commerce was having a dinner dance at the Woman's Club on Saturday at 6 p.m. The cost was $60 per person with plentiful food, an open bar, two different bands and it would be a great event. All were invited to attend. Mr. Holzman had no disclosures or announcements. Vice Chair McCray had no disclosures, but announced he attended the Veterans Day event last Sunday at 10 a.m. He gave the welcome address in the absence of the Chair and the event was well attended. Mr. Karageorge disclosed he did not have a conflict, but he met with Chris Benoit, proprietor of The Little House, and he knew the realtor involved with the short sale item that was tabled at the last meeting. He announced the Chamber of Commerce Luncheon at Bethesda Hospital would be held the next day. The guest speaker would be Dr. Michael Carmichael, one of the top heart surgeons in South Florida. Later that evening was Safe Night at the Woman's Club. The event would be held from 6 to 8 p.m., and it was hosted by Boynton United. The event was free and refreshments, music and safety tips for the holidays would be given. He thanked and congratulated the Concerned Caring Christian Group Award Winners, including Chair Hay, the late Gertrude Sullivan, Suzy Heath, Dr. Martha Meeks - Light, Blanche Girtman, Bill Tome, Rita Simmons, Bishop Sylvester Banks and himself. He also noted Habitat for Humanity would hold a Dedication and House Blessing for their 99th and 100th homes, which was a joint project with the City. The dedication and giving of the keys to two families would occur on Sunday at 2 p.m. At 4 p.m., there would be a benefit concert for the New York and New Jersey victims of Hurricane Sandy at Boynton Beach High School. The Boynton Community and Dimensional Harmony Choirs would perform and the funds would be donated to the Red Cross. All were invited to attend. Chair Hay agreed Dr. Carmichael was an excellent surgeon and he had performed surgery on a member of his family in the past. He also congratulated staff and commented members attended the Florida Redevelopment Association Annual Conference in Daytona. The Board was well received, and he applauded Executive 2 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 Director Vivian Brooks, who was a presenter at the conference. He noted the Agency was short on awards this year, but anticipated they would be recognized for their accomplishments next year now that they reviewed the award criteria. Chair Hay observed the youth at the Haunted Pirate Fest and noted they enjoyed the staged pirate fights. He looked forward to next year and contemplated the event would be even better. VII. Announcements & Awards: A. Holiday Extravaganza Kathy Biscuiti, Special Events Director, announced the Extravaganza would be held December 1, 2012, starting at 5 p.m. The parade would travel north in the southbound lane of Federal Highway, from 12th Avenue to Ocean Avenue. Immediately following the parade was the tree and menorah lighting and then the concert featuring The Contours, an original Motown group performing their original hits plus hits from the Temptations, Four Tops, Miracles and Stevie Wonder. Food and drinks would be available for purchase. No pets were allowed. B. Holiday Boat Parade The combined Boynton and Delray Beach Holiday Boat Parade would be held the following Friday, commencing at 6:30 p.m. at the Boynton Inlet, traveling south to the C- 15 Canal just south of Delray Beach. There would be a party at the Boynton Harbor Marina, starting at 5:30 p.m. and a live band would be present, as would Santa. Valet parking was available on site as well as at the parking garage and the former Bank of America site at the corner of Ocean and Federal. Ms. Biscuiti noted Boynton officials would be the parade judges. Mr. Buchanan congratulated Ms. Biscuiti for her work on the Haunted Pirate Fest event. VIII. Consent Agenda: A. Approval of minutes — Community Redevelopment Agency Board Meeting, October 9, 2012 B. Approval of Period Ended October 31, 2012 Financial Report C. Monthly Purchase Orders IX. Pulled Comment Agenda Items: None. 3 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 X. Information Only A. Public Comment Log There were no comments on this item. B. Media Outreach and Editorial Coverage Mr. Karageorge thanked Margee Walsh and Kathy Biscuiti on an excellent job for the Haunted Pirate Fest and Community Redevelopment Agency programs and activities. C. Budget update on Art Tree Lighting Project Mr. Karageorge thanked Mike Simon, Development Director, for his diligence in obtaining the Art Tree Lighting project under budget. The project was progressing and once completed, would enhance the Avenue. D. Update on Heritage Park Plaque (Citizen of the Year Award) Mr. Karageorge thanked Harry Meeks for his thoughts on this item. E. Update on three CDC Contracts for Ocean Breeze West There were no comments on this item. XI. Public Comments Lori Durante, Executive Director of the Museum of Lifestyle and Fashion History, POB 6127, Delray Beach, a non - profit 501(C)3 corporation, was present and distributed a handout to the Board. One program hosted by the Museum was the Taste History Culinary Tour of Historical Palm Beach County. The Museum holds these tours for Delray, Boynton, Lake Worth and Lantana. Ms. Durante pointed out there was a feature story about the Taste History Culinary Tour in the October issue of the Boca Raton Observer special culinary issue. The article was a full page that included photos of eateries in Boynton Beach. The tours were conducted since October of last year and the first seven months sold out. They have been introducing the Boynton Beach culinary scene along Ocean Avenue and other food establishments and included a tour of the Avenue of the Arts and the Industrial Arts District. On November 3rd, the Museum hosted a private culinary tour for the Palm Beach County Historical Society which focused on the taste history of Boynton Beach. Participants visited the Boynton Beach Library for a historical presentation by Janet 4 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 DeVries, toured the Schoolhouse Children's Museum, and the Avenue of the Arts. Ms. Coles - Dobay, Public Art Administrator, shared information about the outdoor kinetic art exhibit and the upcoming symposium. They also traveled to the historic Boynton Woman's Club, visited the Artful Dreamers Art Gallery. The eateries they visited included Palermo's Bakery, the Secret Garden Cafe, the Little House and Bun Bun Cafe. The Museum's mission is to provide a food tasting experience while learning about the food and history of the area or eatery on the tour. One guest commented they learned Boynton Beach was a beautiful City that has a lot to offer. They have a blog containing lots of photos of the tours they conduct, and Ms. Durante hoped the links she had been sending to the Board were viewed. She noted those organizations take the links from the blog and post them on their websites. The blog from the Bellagio Country Club was shared with hundreds of their members. While it reflected pride and fun, it also served to help market Boynton Beach. Chair Hay thanked Ms. Durante and noted she was recognized as an outstanding business leader in South Florida. Chair Hay closed the Public Audience. XII. Public Hearing A. Consideration of approval of Sidewalk Cafe Permit for the Little House — 480 E. Ocean Avenue Motion Mr. Holzman moved to approve. Mr. Karageorge seconded the motion that unanimously passed. XIII. Old Business A. Update on Haunted Pirates Fest Ms. Biscuiti gave an update on the Haunted Pirate Fest and a video presentation was viewed. About 4,000 people attended the two -day event. Ms. Biscuiti explained there were continuous crowds. The Schoolhouse Children's Museum was transformed into a haunted house that attracted 1,900 people. A 60 -foot dining tent had each seat occupied for two days. The interaction between the pirates and kids was great and Chair Hay commented he was glad they could hold the event this year. Mr. Karageorge also pointed out the Museum obtained additional memberships from the event. 5 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 B. Consideration of Transfer of Properties located at 118 & 124 NW 10th Avenue to the City of Boynton Beach Motion Mr. Karageorge moved to approve. Mr. Holzman seconded the motion that unanimously passed. Mr. Karageorge also extended thanks to Assistant City Attorney David Tolces for his work on this item. XIV. New Business A. Consideration of Request from HAP Grant Recipients, Teasha & Kelly Thomas, to accept terms of short sale negotiation (Tabled 10/9/12) Motion Vice Chair McCray moved to remove. Mr. Karageorge seconded the motion that unanimously passed. Mike Simon, Development Director, explained this item was previously heard at the October meeting. The agenda item was from the Thomas's who received a grant to purchase a home in the Preserve under the Housing Assistance Program (HAP). They were requesting the Board accept the terms of a short sale which would net the CRA $5,000 — 10% of the $50K grant. Angelina Namia, Attorney, 210 Belmont Place at Boynton Beach, requested the item be tabled. Bank of America had not provided any additional information or any finalization of an approval. Therefore the dollar amount of any recapture was unknown. Motion Mr. Holzman moved to table. Mr. Buchanan seconded the motion that unanimously passed. B. Consideration of Request from HAP Grant Recipient, Erica Poag, to accept terms of short sale negotiation Mr. Simon explained this item was to consider a request by Erica Poag who purchased a home in the Preserve in 2007. She had received a HAP Grant from the Community Redevelopment Agency. Mr. Simon explained staff received an email on October 28, 2012, to present the terms of a short sale to the Board, but had no confirmation the Bank would accept the terms of the short sale. Part of the conundrum was there were 6 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 no policies or procedures from the Board on the issue. He noted the Community Redevelopment Agency was in the second mortgage position. Mr. Holzman expressed it was unfair to the prior requestor, for the Board to consider the matter. Motion Mr. Holzman moved to table the item and request the same information as was requested in the prior agenda item. Mr. Buchanan requested clarification. Mr. Simon explained in prior cases, such as the Thomas's and other recipients, there was a mixed situation with the lender, purchaser and the Community Redevelopment Agency in that the Bank usually works with the buyer, seller and mortgage company to accept short sale terms. In this case, there was a third position and with the City and County, a fourth position. All parties had to agree to the terms of the short sale in order to enact it and a Bank would be hesitant to provide their acceptance of the terms if two other parties at the table have not provided direction on their position of the request. If the Community Redevelopment Agency provided direction, the Bank could move in an appropriate fashion. Attorney Namia pointed out that was not the case with all property owners and the Banks are the first mortgagees. Each request was in a different stage of a short sale. If the Board tabled the item because of the Thomas's request, it would not be fair. The Banks should make the decision first and then the homeowner would have to present all their information to the Board Mr. Karageorge noted each banking institution or mortgagor may have different policies. He thought it was important to be consistent and fair and noted there were various ramifications involved with housing issues. He proposed the Board be consistent in each case and hear each separately. The Board could ask similar questions of all parties based on the individual circumstances and stage of each request. Richard Carey, Attorney for the Poags, explained with their short sale, they have a contract on the property. They had been negotiating the short sale for a few months and the Broker Price Opinion (BPO) was completed. The Bank notified them what they would accept. In order to meet that requirement, there are certain funds and proceeds that could be allocated to all parties involved. With this request, the Community Redevelopment Agency would receive $6,000 towards the outstanding grant balance. Erica Poag, 1759 NE 6th Street, explained she had appeared before the Board two years ago, requesting the Board reconsider their decision to amend the Direct Incentive 7 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 Finance Agreement (DIFA) allowing Cornerstone to continue to receive a tax break to convert a homeowner community into a low- income rental community. She felt the Agency did not consider the families who already purchased homes in the community and how it would impact them when they approved the amendment. Ms. Ross arrived at 7:05 p.m. Ms. Poag explained she purchased her home for $239,900, including the $50,000 grant and the current value of the home was $87,000. She recognized the economy impacted the price of homes, but not nearly as much as the approval of the second DIFA amendment. She would never recover what she paid for the property and the short sale was her only option. She felt that as a result of the amendment, she now lives in a low - income community and was surrounded by unsavory characters, where drugs were sold and she wanted to be safe. She requested the Community Redevelopment Agency forgive or negotiate the low payback amount of the grant and that this time, the Agency make the right decision for the homeowners and not the developer. Ms. Poag, in response to questions, explained she was not yet ready to close, and she would need a letter from the Community Redevelopment Agency indicating what was acceptable to them so all parties would be on the same page. Mr. Holzman noted the process was difficult, but even with a letter the Bank could still reject the terms. If the Board agreed to the amount, percentage -wise, it would set a precedent for the community and any other real estate transactions the Board accepted in the future. Mr. Buchanan suggested the Board be realistic as the money was never coming back to the Community Redevelopment Agency just as it would not go back to the Bank. He felt it was in the best interest of the taxpayers to recoup whatever funds they could, when they could, and that they should approve short sales. Attorney Cherof agreed language could be added to the letter to protect the Board and facilitate the matter. A demand letter had been issued and the recipient was three payments behind in her mortgage. Lengthy discussion ensued regarding the changes that occur when affordable housing is added in or near workforce housing and Ms. Brooks explained the history of the DIFA agreements. Vice Chair McCray noted 29 individuals received SHIP funds totaling about $1.5 million and with HAP, City, County, and Florida Housing Finance funding, the amount was about $2 million. The Community Redevelopment Agency was losing money. Mr. Holzman inquired what documentation would be sufficient from the prior requestor. Attorney Cherof responded some type of commitment, proposal or guideline that would trigger approval of the transaction was needed. A document in the nature of a proposed closing statement that reflected not only what the Community Redevelopment Agency 8 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 would receive, but also what the property owner was obligated to do to be able to close on a short sale would be appropriate. In this instance, the seller would not be bringing any money to the table nor did Attorney Carey have any documentation from the lender indicating what steps needed to be taken. Most of his negotiation was done over the phone and it was difficult to obtain something in writing. Currently the lender would not issue an approval unless the other parties were in agreement, which was the same issue the Community Redevelopment Agency was concerned about. Attorney Cherof explained the Community Redevelopment Agency was in a different position than a traditional lender as the funds used in the transaction were public dollars so the Board had a higher level of accountability than a private lender would have. Mr. Holzman thought there was documentation missing from the first individual and it would be improper for the Board to accept the word of any individual without requesting the same information from each requestor. The sale would not fall through if the Board asked for the documentation and he was not compelled to agree to anything unless the Board had, at least, some type of a closing statement. Chair Hay thought the Agency should get something out of the investment and approve the short sale since the Agency would receive nothing if the property went to foreclosure. Attorney Cherof clarified there would be no difference if the Board approved the request with a contingency than if the Bank approved it conditionally. The end result would be the same. Further discussion followed some institutions did not care about second lien holder positions, but in some instances, the second lien holder holds all the leverage. Mr. Karageorge inquired if any leverage could be gained in this case as opposed to a normal second position with respect to negotiating with the principal mortgage holder. Attorney Cherof did not believe so. Mr. Holzman reiterated it was imprudent for the Board to move forward on the item without proper documentation. As to moving forward on a contingency basis, Attorney Cherof expressed the better practice would be to obtain the documentation so the Board had a record of what the transaction was. He also noted time was not working against the applicant as she was still in possession of the property, she was not making the payments, and no foreclosure was yet pending. It was unlikely a foreclosure would be filed and completed before the next meeting. The Board would then have the benefit of reviewing the pleadings. Attorney Carey explained documentation reflecting a proposed closing date and statement showing the fees could be provided prior to any approval, but he could not provide documentation as to whether the Bank would approve the short sale. He also opined the issue was time sensitive as the 2007 Mortgage Forgiveness Act would 9 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 expire at the end of this year, and his client would like to close prior to the end of the year to avoid any tax liability. Attorney Carey agreed to provide the closing statement and email communications with the Bank prior to the next meeting. He also commented it would be helpful to have an approval letter with a contingency stating the Board would release the property for a named amount of money, even if it specified it would not vest until the next Board meeting. He did not think waiting until the next Board meeting was in the best interest of the homeowner. Mr. Holzman disagreed and thought it would be to everyone's benefit to set a precedent that the Board specifically required a proposed closing document indicating all the information and all of the backup. He also commented the homeowner came to the Board at the last minute and it was inappropriate to assert the Board was holding the matter up. Mr. Buchanan inquired if the Board had the documentation and they approved it with a contingency was any different than approving it with the same contingency now. Mr. Holzman thought there was a difference because if the documentation was provided, the Board would know what they were approving. Attorney Cherof suggested making a motion to tentatively grant the request, contingent upon obtaining supporting documentation that would be reviewed at the next Board meeting and approving or disapproving it then. In this manner, counsel could signal to the lender that the Board was prepared to make the transaction for the stated request and net $6,000 and if the paperwork supported that figure, it would and if not, it would not. Motion Mr. Buchanan so moved. Ms. Ross seconded the motion that passed 5 -1 (Vice Chair McCray dissenting.) C. Consideration of Request from HAP Grant Recipient, Lauren Godden, to accept terms of Short Sale negotiation Mr. Simon presented the request, which was the same as the prior agenda items. Ms. Godden received a $50,000 grant and closed on her home in December 2007 in the Preserve. The original purchase price was $239,999 and the current short sale offer was for $80,000. The first mortgage amount, at closing, was $181,000. Lauren Godden, 1819 NE 5th Street, explained she grew up in Palm Beach County. She purchased a home in the Preserve based on the Community Redevelopment Agency advertisement and the Agency's dedication to the development. Ms. Godden spoke about the DIFA amendment and the low- income housing issue which was 10 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 previously discussed. The residents hired an attorney to ask the Agency to reconsider the matter, which was denied. Since then, the neighborhood declined. Ms. Godden acknowledged the effect of the economy on housing, but noted she was a local prosecutor and she encountered situations where she was approached by defendants at the pool inquiring if she worked for the State's Attorney and then seeing the defendant in the courtroom. The situation has affected her personal safety. She was behind in her mortgage and was in the pre - foreclosure stage. Her loan was previously with Bank Atlantic which was converted to BB &T and she was fast tracked. Attorney Carey explained they were working with Bank Atlantic, but the servicer changed and time was of the essence. Ms. Godden was in an earlier stage as it pertained to what the Bank was willing to accept on this transaction. He acknowledged the Board's request for closing documents, statements and email communications as noted in the previous agenda requests and agreed to provide them within 30 days. Attorney Carey commented his firm seeks to obtain at least $8,500, but Banks often look to the federal guidelines which dictate a second lien holder is only entitled to 6 %. Currently, they did not have the exact amount BB &T was willing to accept, but hoped it would be for the $8,500 they requested. Attorney Cherof explained the previous motion would be acceptable to use for this request. Motion Mr. Buchanan so moved. Mr. Karageorge seconded the motion that passed 5 -1 (Vice Chair McCray dissenting.) Vice Chair McCray explained he did not support the motion because he did not have the documentation and he was not on the Board when the matter initially was addressed. Mr. Holzman suggested hearing from the first applicants from item 14 A, Teasha and Kelly Thomas. Attorney Namia, representing the Thomas's expressed her concern that the Board did not have enough facts to make a decision. She agreed with Mr. Holzman that any decision made without documentation would be egregious. She explained unless the Board had a preliminary HUD Statement and all the possible written documentation, nothing should be considered, including her client's case. She noted there were so many different contingencies associated with each letter that each case must be treated individually. Even though the Board might be setting a precedent by accepting a settlement, it did not mean that each case had to be settled for the same amount. She explained the Board did not know if each case would provide 11 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 a Waiver of Deficiencies, which in some cases, allowed for the homeowner to have an incentive to move out, in the amount of $3,000 to $10,000. Attorney Namia explained in some cases, she has seen upward of $20,000, although not necessarily with these types of grants. She implored the Board not to make a decision without documentation and the process could not be rushed. Her client would also like to close before the end of the year. Her client was two months behind in her mortgage payments. She agreed the contingency language suggested by Attorney Cherof was appropriate, but without seeing something in writing, the Board should not provide something in writing back. She commented she has experience with at least 10 different lenders in the short sale arena. She was not in the real estate business. Attorney Cherof explained when the applicant initially appeared, they did not provide any documentation. Attorney Namia responded they did, it was just not in hard copy. Attorney Cherof clarified to the Chair that the Board relied on the representation made by the counsel that stepped to the microphone. The Board had not granted any final approval. The matter would return to the Board at its next meeting. All rights were reserved to the Community Redevelopment Agency Board at this point, and all the Board did was signal a willingness to engage in negotiations and to put something on the table so counsel could go back and structure a deal around. He saw no reason to reconsider the two prior motions. Attorney Namia agreed with Attorney Cherof's comments contingent on seeing the documents and making sure there was a move out incentive that could add to the benefit of the Community Redevelopment Agency. She favored the Board having additional contingencies as opposed to having only words. She thought language such as contingent on the borrower not receiving a move out incentive and the first mortgagee approving the final numbers would be helpful. After further discussion there was consensus not to reconsider the prior motions and to rely on the advice of Attorney Cherof. D. Consideration of Request from HAP Grant Recipients, Hector & Jennifer Lopez, to accept terms of short sale negotiation Mr. Simon presented the request and the applicant. Ms. Lopez explained they purchased the home in 2008 for $240,000 and received a $45,000 grant from the Community Redevelopment Agency. The home was now valued at $65,000 and they were in the foreclosure process trying to short sell. They vacated the dwelling based on the activities occurring in the community. Her immediate neighbors and those across from her were all renters and she was finding drugs on the ground. Individuals were speeding though the neighborhood and coming to her home looking for others at all hours of the night. Mr. Lopez was a firefighter who was not home at night while on shift, and she did not feel safe even with an alarm system. Her children could not play outside during the day due to the activities, so they vacated the premises. She 12 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 requested the Board consider negotiating this matter. They have a contract, but she did not know if the Brokers Price Opinion had been completed. Mr. Simon explained the current offer was for $85,000. Staff did not have an offer in writing from the Bank with a HUD Statement or preliminary HUD Statement indicating the funds or proceeds of the sale. Ms. Lopez conveyed that their counsel, Attorney Dorfin, had indicated to staff that the Bank was offering the 6% and it was assumed the amount would be $6,000. The Agency's grant was in third position with a SHIP grant in second position. Attorney Cherof indicated the Board could make the same motion to show the Bank they were willing to consider the issue. Motion Mr. Buchanan so moved. Ms. Ross seconded the motion. The first mortgage was held by Wells Fargo Bank. The motion passed 5 -1 (Vice Chair McCray dissenting.) E. Consideration of uses for additional funding available through bond refunding Ms. Brooks explained when the Community Redevelopment Agency refinanced their bond to take advantage of very -low interest rates, they received a saving of $203K and she was recommending additional uses for the money. The first recommendation was to move Heather English into a different position that was vacant and unfunded for some time. Ms. English would handle small business tasks as she has a college degree in business. Ms. Brooks handed out an economic development pamphlet created by Ms. English. Ms. English also developed the small business newsletter that was issued with the utility bills. She is extremely proficient on the computer and she was receiving great feedback from small business associates. The additional cost to move her into the position at the mid -point salary range was $10,000 and her new salary would be $55K, which was the mid -point for that job title. The other recommendation was a 5% merit pool administered by Ms. Brooks based on staff's performance over the last year and the appraisals she completed last month. The increase would include the change in FICA deductions. This action would total $45,640. The balance of the funds would be used for parking redevelopment planning. Staff owns property at First Street and First Avenue, which was purchased for the sole purpose of 13 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 creating parking for the amphitheater and Old High School area. There was some funding for parking, but more was needed. Ms. Brooks sought to create a walkway from the parking lot. There was a grass easement owned by the City which could be used as a walkway or pathway from the parking lot down to Ocean Avenue which would need to be lighted. The Agency also wanted to resurface and improve land on 4th Avenue that was surrounded by concrete bollards and located behind Hurricane Alley that was owned by the City. Mr. Holzman acknowledged staff did a great job, but the City Commission had continuously stated on the City level that they would not be providing raises, and some discussions at the City level were whether to reduce salaries by 20 %. He expressed, in an attempt to ensure they treated all employees fairly, that it would not be appropriate to provide any type of salary or bonus increase. If there was extra money to be used, it should be used to attract business to the community, improve the land values of properties, beautify the landscapes and bring business downtown to ensure property values increased to create more money for the Board and everyone else. To provide funds for staff, at this point, would be a misuse of citizen dollars. Chair Hay disagreed and believed any salary increases had been stalemated. In addition to the 5% merit pool, he proposed Ms. Brooks also receive a 5% increase from those funds as the City had one of the best Agencies in the State. He felt they should be rewarded for a job well done. Staff warranted an increase and he would support the request. Mr. Karageorge pointed out Agency staff had not had a raise for four years. During that time, they remained professional going above and beyond their duties, winning awards and representing the Community Redevelopment Agency well. He noted Ms. Biscuiti's duties increased. Mr. Simon brought three projects in on schedule and without any debt service. He noted this was remarkable compared to other Agencies within the State and in the Country. Due to Ms. Harris, the Community Redevelopment Agency was the only Agency in the County to have a squeaky clean audit over the last three or four years. A Familiarization Tour was scheduled in a few months to bring business to the City. Staff works well with the Business Development Board, the Convention and Visitor's Bureau and the Economic Development Council and were working to offer Historic Tax Credits to attract and incentivize redevelopment. Ms. Brooks made a presentation at the Redevelopment Conference and last year, 15 new businesses located within the City. Based on inquiries received about incentives and grants, Mr. Karageorge anticipated that the trend would continue. Funds were already allocated for new business incentives and to allow existing businesses to expand. 14 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 Ms. Ross was fine with the reclassification request and inquired how the merit pool would be distributed. Ms. Brooks explained the funds would be distributed based on the reviews she conducted and each employee would receive a raise. Mr. Buchanan inquired if City staff received one pay increase since the Community Redevelopment Agency staff had. Ms. Brooks explained Agency staff had a 6% decrease last year and did not receive an increase when City staff obtained one. They did not receive retirement benefits last year. She commented Agency staff would be slightly behind City staff and Agency staff does not receive pensions. She explained one could not compare the Agency's retirement benefits to City pensions because there was no guaranteed benefit at the end. Motion Mr. Buchanan moved to fund the pool as requested and reclassify Ms. English. Ms. Ross seconded the motion that passed 4 -2 (Vice Chair McCray and Mr. Holzman dissenting.) Motion Mr. Buchanan moved to give the Executive Director a 5% raise. Mr. Karageorge seconded the motion. The motion failed 3 -3 (Vice Chair McCray, Mr. Holzman and Ms. Ross dissenting.) Motion Ms. Ross moved to give the Executive Director 2.5 %. Vice Chair McCray seconded the motion. Ms. Ross noted individual staff members would not be receiving the full 5 %, as it would be distributed amongst staff. Ms. Brooks clarified some would receive the full 5% or more and some would not. Vice Chair McCray commented the Community Redevelopment Agency was losing money and the funds should be allocated for where it needed to go. Susan Harris, Finance Director, commented Ms. Brook's salary was on the lower end compared to other Community Redevelopment Agency Directors in the County. The motion failed 3 -3 (Chair Hay, Mr. Buchanan and Mr. Holzman dissenting.) Motion Mr. Buchanan moved to give the Executive Director 3 %. Ms. Ross seconded the motion that passed 4 -2 (Vice Chair McCray and Mr. Holzman dissenting.) 15 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 Motion Mr. Buchanan moved to approve funding for the parking. Mr. Karageorge seconded the motion that passed 4 -2 (Vice Chair McCray and Mr. Holzman dissenting.) F. Consideration of submittal of application for Local Historic Register for 211 E. Ocean Motion Mr. Holzman moved to approve. Vice Chair McCray seconded the motion that unanimously passed. It was noted this item was strictly about the designation of the Magnuson House and nothing else. G. Consideration of expanding the uses within the RFP for 211 E. Ocean Avenue Ms. Brooks explained this item was discussed at the budget meeting. She met Scott Conley, a local software developer from Boynton Beach who was trying to grow a software hub in the City. Scott Conley, Flipstone Technology Partners, 6659 Boynton Beach Boulevard, explained his business is located in West Boynton and they were looking for a new home. He thought his business would be good for the City so he toured the Magnuson House. He commented he represents an industry that is in a state of flux. Internet start- up businesses are in high demand across the country. The industry is educated and affluent and a recent Miami Herald article suggested that even in the South Florida, tri- county area which has 80 to 100 fledgling companies, the trade commands double the median income of the area for jobs created per space. Mr. Conley thought Boynton Beach had a legitimate pitch and the City has some assets that other municipalities could not offer. He requested the Board consider an alternative use for the RFP for the Magnuson House. Mr. Conley explained the business was a high -risk business but it attracts individuals with large amounts of money who invest in internet -based businesses and there was much home run hitting. He commented his company would serve as ambassadors of the City to others in the industry wanting to locate in Boynton. He thought the entrepreneurs of the industry were "hippie" style individuals that like fixer - uppers, were pro - social and were moving high tech industries. 16 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 Ms. Brooks explained staff had not considered the use when it was discussed because staff was not aware the industry was around. Modernizing Medicine left because they outgrew the space and the owner knew Mr. Conley. Ms. Brooks explained the Agency's goal was to never let that happen again as they needed to retain individuals who have this type of education and income in the downtown. Mr. Holzman thought software developers would be great for the downtown, but he emphasized the Board already had a plan for what they wanted for the downtown. If the Board wanted to pursue high tech industry, then it needed to change the plan for Ocean Avenue and it would be expensive to do so. The Little House would be a waste as would the lighting that was planned. Constantly changing the plan would result in not attracting anyone. The City was trying to create a brand, and now the Agency was trying to be a computer hub. If the Board wanted to be a computer hub it should put all of its resources into that arena, but if not, they should not pursue the matter. Chair Hay disagreed and commented their proposed income level was substantial. He thought the Board should not wear blinders and be open to change. Mr. Conley commented he did not believe the notion of a walkable community and the high tech sectors were mutually exclusive. One thing that made Boynton Beach a compelling opportunity was its lack of identity. They were requesting the opportunity to evaluate Boynton Beach from the inside. Many municipalities were throwing money around to relocate and /or attract start up businesses in their communities. If one was going to be in the software industry and ask individuals with a lot of money to take a lot of risk, it should be near communities with money such as Ocean Ridge and Jupiter Island. Presently, the money was going to New York City, or Austin, Texas. The next incentive was no income tax and proximity to the Atlantic Ocean. Mr. Karageorge thought the business could be a catalyst for others to build a community and the Agency should widen its net and expand the uses in the RFP for the property. Motion Mr. Karageorge so moved. Mr. Buchanan seconded the motion. Debbie Brookes, owner of Beachcomber Art at 211 S. Federal Highway, expressed there were other locations for the use and Las Ventanas had office space. She thought it was important to have a cohesive plan what they want the area to look like. She urged the Board to reconsider where they would place the business. Vivian Brooks clarified staff was not recommending the building go to the business, only that they be able to respond to the RFP. Ms. Ross inquired if they responded to the RFP and relocated to the building, whether he anticipated his company would grow at the rate of Modernizing Medicine. Mr. Conley did not believe so and explained some 17 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 businesses wanted to scale and grow, but his business would want to remain at eight employees. His employees sometimes travel a 40- minute drive and some employees only come to the office once a month. Each time they meet at a location they ask themselves if it was where they want to set up shop. If the building was not an option, they would not consider Las Ventanas because they wanted a long -term solution that was appealing to the foot traffic community, and the beach access and they would shop Delray Beach and Palm Beach Gardens. Mr. Buchanan noted the business may or may not be the best proposal for the property, but agreed the Agency should expand the RFP as the business would respect the historical aspects of the building. The motion failed 3 -3 (Vice Chair McCray, Mr. Holzman and Ms. Ross dissenting.) H. Consideration of issuing an RFP /RFQ for the Sale and Redevelopment of 211 E. Ocean Avenue 1. Ms. Brooks explained staff was directed to craft the RFP at the Budget Hearing. Motion Mr. Karageorge moved to approve. Ms. Ross seconded the motion that unanimously passed. J. Consideration of approval of Resolution 12 -09 Waving the Community Redevelopment Agency's right to declare a default of Direct Incentive Funding Agreement ( "DIFA ") between the Community Redevelopment Agency and Boynton Waterways Investment Associates, LLC and Consenting to Assignment of the DIFA to CJUF III Promenade (Mr. Holzman left the dais at 8.30 p.m.) Mr. Holzman thought regardless who the recipient or buyer was, it would be wrong for the Board to grant a waiver of the DIFA with anyone without first sitting down and negotiating what they would receive in return for the waiver. Taking away a contractual right the Board had would be a mistake. The transfer of the property may or may not constitute a default. If it did, the City no longer needed to pay the owner of the property $440,000 each year, which would save the City about $3 million in taxpayer money. If a waiver is granted, it should be with the new owner to obtain something back greater than what they had. Mr. Karageorge explained the item did not discuss a waiver, it discussed an assignment. If it was assigned to Canyon Johnson Urban Funds III (CJUF), there would not be a foreclosure situation. 18 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 Attorney Cherof explained there was a motion for Summary Judgment and a foreclosure had been entered. A foreclosure sale would take place at the end of December. He thought the Agency would face an interested party at the foreclosure sale and was asking for a waiver. The item was consideration of the Assignment and counsel was present. Michael Weiner, SE First Avenue. Delray Beach, Attorney for CJUF III, requested this item be tabled to the next meeting. CJUF III was not in a position to move forward with the transaction at this time. There is a lot at stake for the City and the new owner. He anticipated he would appear before the Board in December. Discussion followed the Community Redevelopment Agency could potentially pay out $3.7 million. Attorney Weiner explained it was important to hear from all stakeholders and opted to withdraw the request. He explained there have been good conversations occurring. Motion Vice Chair McCray moved to withdraw. The motion died for lack of a second. Motion Mr. Buchanan moved to table the item. Mr. Karageorge seconded the motion that passed 5 -0 (Mr. Holzman not present for the vote.) K. Consideration of Kimley Horn & Associates Contract for Design and Engineering services for the proposed parking lot project at the corner of NE 21 st Avenue and NE 1 st Street Mr. Holzman returned to the dais at 8:34 p.m. Ms. Brooks explained Kimley Horn & Associates was under continuing contract and the price was to complete civil engineering for the walkway and parking lot at First Street and First Avenue. The cost was $31,900 which was below 10 %. They have not designed the parking lot, but they would try to save some trees. It was anticipated there would be 70 to 80 parking spaces. In response to questions regarding whether this item was put out for bid, Ms. Brooks explained the Agency issued a bid for professional services under a continuing contract. Vice Chair McCray took exception to the Agency using the same contractor or consultant. Ms. Brooks explained they have very few contracts. 19 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida November 13, 2012 Motion Mr. Holzman moved to approve. Mr. Buchanan seconded the motion. It was noted this contract was associated with an earlier agenda item. The motion unanimously passed. V. Executive Director's Report A. Project Status Update There were no comments on this item. VI. Future Agenda Items None. VII. Adjournment There being no further business to discuss, the meeting was properly adjourned at 8:37 p.m. R Catherine Cherry Recording Secretary 111412 20