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Minutes 12-14-21 Minutes of the Community Redevelopment Agency Board Meeting Held on Tuesday, December 14, 2021, at 5:30 PM via GoToWebinar Online Meeting and City Hall Commission Chambers 100 E. Ocean Avenue, Boynton Beach, Florida Present Steven B. Grant, Chair Thuy Shutt, Executive Director Woodrow L. Hay, Vice Chair Kathryn Rossmell, Board Counsel Justin Katz, Board Member Ty Penserga, Board Member Absent: Christina Romelus, Board Member 1. Call to Order Chair Grant called the meeting to order at 5:32 p.m. 2. Invocation The Invocation was given by Reverend Woodrow Hay. 3. Pledge of Allegiance The members recited the Pledge of Allegiance to the Flag. 4. Roll Call Roll call established a quorum was present. 5. Agenda Approval A. Additions, Deletions, Corrections to the Agenda Chair Grant requested hearing Old Business Item 16L., Update on the 115 N. Federal Highway Infill Mixed-Use Redevelopment Project Negotiations with Affiliated Development, first under Old Business. B. Adoption of Agenda Motion Board Member Penserga moved to approve the agenda as amended. Vice Chair Hay seconded the motion. The motion passed unanimously. Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 6. Legal None. 7. 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 Board Member Katz was contacted by Attorney Bonnie Miskel regarding Hyperion, and spoke to, via text and an email, Centennial Management regarding the Cottage District item. Board Member Penserga also spoke to Attorney Miskel and Elizabeth Roque of Centennial Management. Vice Chair Hay had no disclosures, but did attend the Boynton Beach and Delray Beach Parade and advised they were both well attended. He praised CRA staff and the City. Chair Grant explained they had the Lantana, Hypoluxo, Boynton Beach and Delray Beach Boat Parade. They were able to include those other municipalities. He thanked all the judges and captains and hoped restaurants and businesses did well. Chair Grant spoke with Hyperion, Jeff Burns of Affiliated Development and received emails from Centennial, but had not spoken with them. He spoke to Brian Fitzpatrick regarding his properties. He also received an email from Tim Collins, from C Life C Food. 8. Announcements and Awards Mercedes Coppin, CRA Business Promotions and Event's Manager, stated the CRA is helping Centennial with the job fair this week in partnership with Career Source Palm Beach County for workers for the Heart of Boynton Beach Village project now under way. The job fair will take place December 17th and 18th from 12 p.m. to 4 p.m. at the Ocean Breeze East Apartment Clubhouse, 100 NE 2nd Avenue. There will be a virtual component to connect directly with Centennial Management and their key sub- contractors. The link is on the CRA Facebook page or one can email CoppinM aC k! fl.us. She also placed flyers on the dais and table in the back of the Chamber with additional information. With the assistance of the Neighborhood Officer program, they distributed flyers in community centers in the Heart of Boynton and placed signs and banners in the CRA District to promote the job fair. Vice Chair Hay noted the flyers state it is in the Heart of Boynton Beach and the word Beach should be removed. He learned the graphic was designed by Ms. Roque and staff will inform her of the change. Board Member Penserga asked if staff reached out to the active Heart of Boynton Associations, and learned she had not. Ms. Coppin had 2 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 reached out to the Coalition of Clergy. Vice Chair Hay commented he has reached out to all the organizations he knows of. Chair Grant inquired if the links allow applicants to register ahead of time. He thought it is advantageous applicants can come to the Library and register. He wanted to ensure the flyers are in the Library. 9. Information Only A. Public Relations Articles Associated with the CRA 10. Public Comments James Barden, FTC, 533 E. Ocean, apologized he could not unmute his computer for the prior CRA meeting. He requested he not be evicted if the CRA takes over the Oyer building, as 90 days is not a lot of time to vacate and they have several servers wired and various licenses. They do not feel there is any risk to remain in the building because all the doors are open on the second floor. He would be willing to self- landlord, so if there are any maintenance issues, he would deduct the expense from the rent. The company does a lot in Boynton and wants to stay. Chair Grant explained when the CRA owns the property, and the closing is Thursday, they can make that request to try to change the lease agreement he currently has with the landlord to an extended period of time, before or if the CRA sells the land with the lease agreement. Elizabeth Roque, Centennial Management, stated she removed the word Beach from the Heart of Boynton Village logo. Robert Vescler, 888 Biscayne Boulevard, Miami, was present online. Mr. Vescler explained he is the Chief Executive Officer of Hyperion, and they are closing on the site on the east side of US 1, the Camalier property, next one and also has under contract the Boardwalk Ice Cream site on the west side, contiguous to the RFP process by Affiliated Development. They will be across the street and want the best project for both the east and west sides for the community. They are open to making the Boardwalk Ice Cream site available for assemblage or substitution for the project being developed on the west side of the street. Chair Grant spoke with Legal Counsel and stated in order to have TIF Agreements, there needs to be a land transaction with the property owner. Hyperion will be asking for TIF. Chair Grant wanted the attorney to look into the legality of an exchange for the 209 Federal Highway parcel for TIF for the Hyperion project, because there is no land transaction as part of TIF with their site. The matter would have to be put on the agenda to get Board consensus. Mr. Vescler stated there is something here that can be done for all parties. They are confident working collaboratively they can get to a solution. 3 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 Chair Grant hoped they will have further discussion with the 115 N Federal Highway update. No one else coming forward, public comment was closed. 11. CRA Advisory Board A. Presentations from Florida Redevelopment Association (FRA) 2021 Annual Conference Ms. Shutt explained two of the CRA Advisory Board Members, Yvonne Skovron and Angela Cruz, were present to make a presentation on their attendance at the above Conference. Yvonne Skovron, 350 N Federal Highway, #1405, Boynton Beach, thanked the Board for the opportunity to attend the annual conference and gave a short presentation about what she learned. She advised the conference was very educational and suggested the CRA host an event at City Hall to say what they have accomplished and show what is in the plan, using before and after pictures, to get the community more involved and know where their tax dollars are going. She noted the CRA won an award. Chair Grant explained the CRA has a magazine that is distributed in the District when they issue their Annual Report. A lot of people do not understand what the CRA is doing or their projected plans. Attorney Rossmell explained legally, the CRA can use its Annual Report as a way to educate the public about the CRA. Board Member Penserga liked the idea and noted they previously had the State of the City report. The CRA could combine the information with the State of the CRA. The Annual Report is issued by March 31St each year. Staff also issues press releases and tries to educate the public by issuing jump drives containing the CRA plans. They also used to print the reports and insert them in the Sun Sentinel. If the City wants them to participate in State of the City, they can, also give out the jump drive for outreach. Angela Cruz, 1420 Via De Pepi, also gave a short presentation as contained in the meeting materials. She thought the CRA Board training course was the most educational course of all, giving a basic understanding for public officials, advisory board members, volunteers and legislative and administrative best practices or CRAs. Boynton Beach CRA got Roy Kenzie award for Ocean Breeze East project. Board Member Penserga queried if they heard any great ideas that should be shared with this Board or staff. Ms. Cruz noted it was suggested CRA's not subsidize, but incentivize instead and TIF could be a potential way to incentivize. 4 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 Ms. Skovron thought the CRA 101 four-hour workshop had the most information out of the entire session and the more one attends the workshops, the more one learns. Ms. Shutt explained CRA 101 is for existing and new board members. The course is also offered as part of the Academy. She agreed to check to see if the FRA would make it available to them or past workshops, to be included as part of the orientation. Ms. Shutt advised CRA Advisory Board Member Kelley cannot make the meeting as she has a conflict; however, Ms. Kelley's presentation will be sent to the Board members. B. Reports on Pending Assignments 12. Consent Agenda A. Approval of CRA Board Meeting Minutes - November 9, 2021 B. CRA Financial Report Period Ending November 30, 2021 C. Approval of Commercial Property Improvement Grant Program in the Amount of$25,000 for Advantage Physical Therapy LLC d/b/a Apex Network Physical Therapy#39 located at 906 S. Federal Highway, Suite B, Boynton Beach, FL 33435 D. Approval of Commercial Rent Reimbursement Grant Program in the Amount of $15,000.00 to Advantage Physical Therapy LLC d/b/a Apex Network Physical Therapy #39 located at 906 S. Federal Highway, Suite B, Boynton Beach, FL 33435 E. Approval of the First Amendment to Extend the Term of the Interlocal Agreement between the City and CRA for the Funding of the Tree Canopy Coverage Project to June 30, 2022 F. Approval of Renewal for Standing Ovations, LLC Contractor Agreement for Event Management Services 13. Pulled Consent Agenda Items The Consent Agenda was unanimously approved by the Board. 14. CRA Projects in Progress A. CRA Economic & Business Development Grant Program Update Vicki Curfman, Administrative Assistant, announced they have one new grant that was just approved under the Consent Agenda for Apex, which is a physical therapy office. 5 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 She advised the program had a slower start to the year, but there are lots of applications in the works, and they are getting applications approved more expeditiously. New businesses that moved into the area will be contacted to inform them about the programs. Lots of people are calling and emailing about the grants. Ms. Shutt will try to let construction related new businesses and developers know the program is available. Chair Grant assumed there were outstanding grants from FY 20/21, but wanted to know if there were any outstanding grants two years or older. Ms. Shutt responded they can provide the information and some funds are committed, but as to the status of where they are, staff will have to report back. Chait Grant asked if recipients have a timeline to finish and learned there is a timeline, but many may have experienced slowdowns regarding building permits. Some businesses are asking for extensions. Staff has been working with city staff as well to see if there is anything they can facilitate. There have been COVID delays in the supply industry. Chair Grant thought it was good to get an overview of what the grants have done and learn who will time out. He wanted to see who would lose those funds so they could be used elsewhere. B. 49th Annual Boynton Beach Holiday Boat Parade Recap Ms. Coppin reported on December 10th, the CRA held its 49th Annual Holiday Boat Parade in conjunction with Hypoluxo, Lantana and Delray Beach. There was a great turnout and a lot of positive feedback was received. There were 39 registered participants and great decorations. She thanked all who participated as without their commitment and dedication, they could not host the event. There were thousands of people lined up along the waterway. Staff recorded the entire parade from the Boynton Harbor Marina on Facebook Live and posted it to the CRA Facebook page. Staff estimated there was about 300 people at the Marina, which had family-friendly activities. There were five judges including Chair Grant and Vice Chair Hay and representatives from Lantana and Hypoluxo judged the boats in four categories. Nine winners will be announced at the award dinner on January 5th and after the dinner, the CRA will issue an official press release. Vice Chair Hay gave kudos to Ms. Coppin as the parade was one of the best. The parade went south of Linton to the C 15 Canal. He asked next year, if Delray does not come up with some kind of support, what the plan is. Ms. Shutt explained each year, they try to collaborate in June and offer the opportunity to join. She will make sure they understand the timeliness of a responses. Staff cannot go past the north portion of George Bush Boulevard because only municipalities can pull bridge permits for bridges in their respective jurisdictions and CRA's cannot spend funds outside of the District. They will reach out and remind them earlier to plan and budget accordingly. Delray did not have the funds, but came through at the last minute. C. Social Media Update 6 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 Renee Roberts. Social Media and Communications Specialist, gave an update for November. She commented in November, CRA platforms promoted projects and businesses, and state and national awards for the Boynton Beach CRA. Examples of posts promoting the 49th Annual Boat Parade were viewed. The Business Development team assisted 500 Ocean Cafe with its Grand Opening and Ribbon Cutting on November 12th and helped to promote the new businesses to surrounding residents. The event was broadcast Facebook Live. The Boynton Beach CRA social media pages promoted other business in the District and encouraged residents to shop and dine locally during the holiday season as well. 15. Public Hearing 16. Old Business L. Update on 115 N. Federal Hwy Infill Mixed Use Redevelopment Project Negotiations with Affiliated Development, LLC Ms. Shutt stated staff met and had a kickoff meeting with representatives from Affiliated Development and legal counsel to understand what the proposal involved and gain a broader perspective of what tools are needed to move forward with an agreement. There are 236 units, with half of the units being affordable and a commercial component and a 150-space parking garage. There will be two agreements, a Purchase and Development and a TERFA. The other two agreements will involve the City because the proposal indicates there is an opportunity to sell the garage to the City to operate and maintain, and a lease agreement because some spaces are needed for commercial and private development in the same building. There will be a lot of financial terms from the parties and they hope to develop a term sheet in the next 60 days. Chair Grant reiterated he had previously spoken with Jeff Burns, and Affiliated provided over $5M to the CRA in their proposal. Chair Grant wanted to see more commercial at that location, especially if there is no residential or commercial in the first floor of the garage. He noted there is a lot of frontage The Board heard the possibility of the 209 N Federal Highway property being added, which adds more space to the project. Chair Grant wanted to ensure Affiliated Development includes it in the project if the Board wants it included and have the CRA try to work out an agreement with Hyperion rather than Hyperion trying to work out a deal with Affiliated because Affiliated cannot offer the same compensation the CRA could with TIF. Legal will have to research whether the Law of Private Agreement allows the CRA to acquire land in exchange for a TERFA from a project in the CRA. Attorney Rossmell agreed it is an unusual structure for this type of land swap. They will research it and come back with a recommendation. Board Member Katz requested confirmation the CRA was unsure, since they are not conveying land to Hyperion, if they are allowed to enter into any sort of TIF agreement with them. Attorney Rossmell explained TIF is tied to the sale of the land because the TIF is derived from a specific piece of land. Using TIF from one piece of land to pay for another piece of land is unusual. Board Member Katz spoke to Attorney Miskel, 7 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 because the Boardwalk property will be of some value in the grand scheme. He questioned, regarding land that may or may not be valued at $1 M or more, how they could come to a TIF agreement, even if permissible. Ms. Shutt advised she would feel comfortable seeing something in writing as currently they have nothing to explore. She requested the Board direct staff to get something in writing from Hyperion and their Counsel how they would approach this and staff and counsel can coordinate and look into it further. Board Member Katz wanted to hear their idea and then decide if it is legally allowable. He would not do the work for anyone and work around or massage the law. He supported directing Hyperion to submit a proposal to the CRA. Chair Grant commented Hyperion may produce something that there is no justification for. He wanted to ensure it was legally permissible first and ask Hyperion to produce something at the same time so they could have an answer at the next CRA meeting if it is allowed and see what they are proposing at the same time. Attorney Rossmell explained they are not 100% clear what they are proposing so it is difficult at this juncture to determine if it is a legal structure Board Member Penserga recalled the Board let Mr. Camalier's TIF agreement expire with the understanding they can always come back and pursue another and wanted to hear from both parties. He asked with what is being proposed if they needed to pursue a TIF agreement. Chair Grant asked if they can amend the Purchase and Sale agreement with Davis Camalier to include a separate TIF Agreement. Attorney Rossmell explained the prior agreement is gone. Typically, it would be done separately and she would not recommend an amendment to that agreement. She anticipated returning to the Board with more complete answers. Attorney Rossmell explained it has not typically been done. Jeff Burns, Affiliated Development, explained they had some conversations with Mr. Vescler and they are evaluating how that might affect the plan they have in place. They would be amenable to incorporating that site into the project and have been in contact with the owners of Boardwalk to ensure their continuation in the City. They want to move forward and hoped they could sift through these items quickly. Chair Grant asked if Mr. Vescler was willing to put in writing what they want from the CRA and what exchange would be made as part of a deal for 209 N. Federal Highway. Mr. Vescler agreed to do so. There was a TIF Agreement in place before and they can always apply for it with the property they are developing. Some of the items being reviewed seem to be complicated because there is significant value which they would be providing He questioned the Boardwalk's property $1 M valuation and did not understand where it came from or if there was an appraisal done. They are looking to do a win-win for Affiliated to the extent it could help them if it is something that could be helpful for their plan and for the City if providing the site provides more opportunity for retail. They will develop something more concrete and specific and present it soon. They would like to be directed to come back with some type of plan so as not to slow anyone down. Ms. Shutt requested .receiving the information as soon as possible or by the end of the year so they can coordinate with legal counsel and the agenda has to be posted by the 30th. They need time to review and discuss it. Board Member Katz 8 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 thought another solution would be to sell a piece of land for $10 and accepted $20K for an extension payment not to build a park. They could remit that land or sell it back to the City with the understanding it has no purpose to the CRA beyond incorporating it into the project. If Affiliated wants the City to take ownership of the garage, then the discussion about having a commercial component in the garage site will become moot. He thought the developer would not build and maintain commercial in a building the City owns, which makes the Boardwalk site worthless to the project. He thought incorporating it into a TIF deal across the street was the opposite direction to go in, and the land the City conveyed to the prior owner, could be conveyed back to the City. Then they can start from scratch. Board Member Katz would not vote to be part of a leveraged deal on a non-essential property to the project for a property across the street they already incentivized by virtue of the land. Mr. Vescler did not know what Board Member Katz was talking about as far as a park, but commented there was a major investment going in a week. He thought the members should think about things they say as some of the things suggested did not make him very comfortable. A valuation is a valuation. He was not asking the CRA to pay for the land, they are saying they were contributing it. The tone of the conversation did not feel right for a developer who comes in and makes a significant investment in the City. Board Member Katz agreed all should be careful what they say. Chair Grant noted the property at 209 Federal Highway was .32 of an acre. The Oyer property is .41 acres. If they do the math, they are buying the Oyer property at a little over $200 a square foot. The property 209 N Federal would be about $2.8M. If they want to keep the 1940s building and the parking lot next to it as is and not include it as part of a project with Affiliated, the Board can decide to do so. Chair Grant wanted all to work together, but if Board Member Katz did not feel they should do so and have past biases or a belief of what will happen in the future, he can believe them. He asked whether the Board wanted the Boardwalk project to be part of Affiliated or not to try to make it a more complete project. Board Member Katz commented if the Affiliated proposal to build a garage and sell it to the City and that is still their plan, then he had no interest in the Boardwalk property because there will be no commercial to build or extend in the garage and he is not interested in building a .3 of an acre outparcel adjacent to the project. He would love to see a commercial wrap on the ground floor and the property, through acquisition, could allow the garage to be enhanced to park the extra commercial, unless Affiliated has a different plan about their willingness to build commercial and maintain ownership and operation of the garage and commercial. Chair Grant commented they could put a commercial building next to the garage with'frontage on 209 N. Federal. They needed to know if they want work between the developers to get the parcel included. Vicki Hill, Finance Director, explained there was only $1.1 M in the Acquisition line item. Chair Grant commented they were not asking for CRA money for the property. The CRA has the ability to offer other considerations besides cash up front. 9 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 Ms. Shutt noted there are priorities as they are having preliminary discussions with Affiliated and it is complex deal. She wanted to ensure, before introducing and staff vets other items out, they have the full attention on the 115 N Federal Highway RFP award to Affiliated. If there is something the two parties could collaborate on outside the RFP, the CRA will look at all proposals. They have to review the valuations as there are TIF funds to incentivize and there is only so much money in the future they can promise to the developer Chair Grant reviewed their project site plan and the ability to have a commercial building. He asked Mr. Burns if the density is maxed out, but noted a third of an acre allows them to build more housing and commercial units. Mr. Burns responded this is a new consideration and they are evaluating how that impacts the proposal. There are some unknowns, and Mr. Vescler is working with his attorney to review what he would be proposing and the details for that are needed. Mr. Burns' job is to evaluate how it would impact the project and what the options would be without affecting the merits of their proposal without changing it drastically. If they could add more units that was fine, but if it can allow for more parking, which is a challenge, it would be helpful. Chair Grant asked if the Board wants to entertain working with two developers on both sides of the highway. Vice Chair Hay wanted the proposal in writing so staff can evaluate it and see if they are going down the right road. He knows time is of the essence. He was not opposed to a plan, only that he wanted to see it in writing. Board Member Katz agreed and stated he spoke to Attorney Miskel, but he does have one bias to the tethering of the east and west side, so one will prevent the other from moving forward, which is his concern. He would like to see a proposal and then decide what they should do. Board Member Penserga told Attorney Miskel he wanted something in writing. He agreed with Board Member Katz's comment and if these two parties want to come to an agreement on their own, it is a private transaction. If the goal is to get TIF, he understood with prior deals, there was already a land transaction. He thought they should let the prior TIF expire and when it comes they could ask for a TIF agreement then. If there is a way to do it without the CRA, they could do it privately. If the goal is TIF, he did not see the need to make additional complications. He would be open to looking at other proposals. Chair Grant summarized there was consensus they want something in writing from Hyperion and they would provide that information to Affiliated as soon as they got it and they would ask the CRA attorney's, prior to the meeting to see if Hyperion can reopen a TIF agreement with the CRA based on prior transactions. Board Member Katz liked the last transaction and if there is a simple way to do it, he would rather do it separately and look at the east as the east and the west as the west, than unnecessarily binding the two with a multi-party agreement. 10 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 Mr. Vescler understood the request. He queried if they are contributing the Boardwalk site and paying a significant price for that, they can say if they do not want to tie one to the other, but if there is value, he asked what is their incentive. They wanted to work with the rules. They are not trying to push their project on anyone and was looking to be a collaborative member of the process. They are trying to do something that would help. If the Board thinks it can help, there is a cost for it and the cost is not going into Hyperion's pocket, it is real dollars Hyperion is paying to the seller. They want a win-win process. They will put a proposal in writing and put it is in context. There were no comments received from the public A. Reconsideration of the 2022 CRA Board Meeting Dates Ms. Shutt explained the Board approved the 2022 CRA Meeting Dates. On January 11th there is a conflict with the City. Staff recommends meeting on the 12th. After brief discussion, due to Palm Beach County days, there was agreement to meet on January 10th Motion Vice Chair Hay moved to meet on January 10th. Board Member Penserga seconded the motion. The motion passed unanimously. B. Execution of the Second Amendment to the Purchase and Development Agreement to the Ocean Breeze East Project Ms. Shutt announced at the November 9th meeting, the Board approved language to amend the Purchase and Sale Agreement to delete the Neighborhood Office Program office and move it to the MILK Jr Boulevard mixed-use development and allow staff to work with Centennial on the build-out with a maximum improvement not to exceed $100K. The Board authorized staff to set aside $65K of this year's budget and to work with Ms. Roque on it. The amended agreement was forwarded to Centennial, and Ms. Roque was present to make comments. Ms. Roque explained the Board talked about putting a non-profit in the space. They would amend the original agreement to do the build-out and decided that on top of the $65K they want to use for the build out, they will invest another $50K into it to ensure it is a successful, beautiful environment. Other than that, they are onboard. Chair Grant asked if they can specify in the agreement it is a non-profit that supports youth. Ms. Roque explained anyone in the community who can benefit from the space could occupy the space. They are not expecting to charge rent, but the Board can handle if it is a non-profit or anyone in the community. Louis Swezy, Centennial Management, explained they do not mind a non-profit there or renting it out as a commercial space either. It is whoever the City wants, and 11 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 whatever the shortfall is up to $50K, Centennial will fund it. Ms. Shutt explained CRA dollars can only apply to physical improvements, not marketing or tenant selection. Centennial can choose. American Academy as they are interested in the space and they are making it available. Mr. Swezy explained they make sure they qualify the tenants. Ms. Rossmell explained the CRA cannot be involved in the selection of a tenant, only the improvements of the space. Motion Board Member Penserga moved to approve. He asked if this was a permanent space for one entity. Chair Grant explained this is a landlord tenant space for commercial purposes on a year-to-year basis. Ms. Rossmell suggested staff and legal work with them to revise the amendment and authorize signature of it once the terms were reached based on what was discussed. It includes the cost share with $50K. Board Member Penserga amended his motion to include the provision. Vice Chair Hay seconded the motion . The motion passed unanimously. C. Approval of a Development Agreement between the CRA and Centennial Management Corporation for the Commercial Component of the MLK Jr. Boulevard Corridor Mixed Use Housing Project Ms. Shutt explained this item was before the Board last month, considering budgeting this fiscal year regarding funding the MLK Jr. Boulevard mixed use with the gray shell. There are eight tenant spaces, and included in the agreement is the ability to fix the rent at five years at $22 per square foot and have cost of living increases up to 3% for 10 uses. The CRA with the first lease can help having neighborhood uses there or any relocated existing businesses for the new space. They are for the new residents of Ocean Breeze East and the MLK, Jr. Boulevard project. The CRA has a first right of refusal if sending to a new entity. They designated $25K for the Neighborhood Officer Program (NOP) office to be in bay 8 for the shell, and Centennial shall not be responsible for making tenant improvements in bays 1 -7. The CRA designated restaurant or food service uses in bays 3, 4, 5, or 6 and they want to do it now as it is going to permit. There are terms when each party has to submit. The CRA will offer rent assistance and commercial improvement grants to future commercial tenants. M. Roque agreed with Ms. Shutt's comments. They are not yet ready with the NOP office, but they have plans ready to go to ensure the bays are built while constructing the shell so all will be finished at the same time and they can market the community as soon as possible to identify tenants for the rest of the retail space. Ms. Shutt explained they could have a meeting with the Police Department for the initial programming in place and use the services of the project architect of record. The CRA has $25K for some design services and will try to schedule something right away. The term sheet is before the Board and was sent to Ms. Roque. Ms. Shutt hoped to have this approved on the 10t" 12 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 Motion Vice Chair Hay moved to approve. Board Member Katz seconded the motion. The motion passed unanimously. Chair Grant noted the business entity was Wells Landing LLC, and asked if they could create a fictitious name d/b/a the Heart of Boynton Village Apartments. Mr. Swezy responded as long as the name was not taken, it will be changed. D. Discussion and Consideration of a Tax Increment Revenue Finance Agreement between the CRA and Centennial Management Corporation for the MLK Jr. Boulevard Corridor Mixed Use Project Ms. Shutt explained this was approved for funding of $2,063,288 though a TERFA Agreement for the residential component to cover the shortfall as a result of the construction price increases. Since then, staff spoke with City management and Centennial and they would lower it to $1,630,280 to be reversed to Centennial over 16 years. It means they will get an abatement of taxes after the project is completed and a yearly annual rebate to them of 100% of the TIF up to the $1.6M. The remaining money from the Cherry Hill auction can be used for this. There is a term sheet Legal prepared. They sent it to Ms. Roque and this will allow them to close on the loan. Ms. Shutt explained the difference in TERFA and other TERFA's they have done in the past is if Centennial assigns to another entity, if it is not part of the parent company or a subsidiary such as an association, that the CRA will have the ability to review its financials in the future, but they would look at other TIF agreements the same way. Chair Grant read the developer can assign the agreement to a related entity with prior written consent of the CRA and the CRA will not reasonably withhold. The developer cannot assign the agreement to any other entity without a presentation at a public meeting and the CRA has discretion to approve, deny, or place conditions on the assignment. He commented if Centennial wanted to sell if for a profit to another entity, the CRA says they cannot include the TIF include the TIF agreement as part of their profit making. Attorney Rossmell explained the agreement should say not be unreasonably withheld. Chair Grant commented if there is a profit on the sale, it will go to pay off the TIF agreement or portion of whatever the CRA has left over. Ms. Rogue explained they perused the terms, but they need to understand what is in there as well. Conceptually, they are in agreement. Board Member Katz was comfortable with the language. Motion Vice Chair Hay moved to approve the term sheet with the amendments. Board Member Penserga seconded the motion. The motion passed unanimously. E. Discussion and Consideration of a Second Development Agreement 13 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 between the CRA and Centennial Management Corporation for the MILK Jr. Boulevard Corridor Mixed Use Project Ms. Shutt explained this item pertains to the $433,808 remaining money from the Housing Authority Cherry Hill auction that can be used to supplement the shortfall for the MILK development when COVID caused rising construction costs. The agreement has been forwarded to Centennial and states this is a reimbursement and staff detailed all the contributions the CRA made to move the project forward. Chair Grant asked if the Palm Beach County Housing Authority sold all their property. Ms. Shutt did not know, but would follow up in writing tomorrow because although the Housing Authority is likely slow, she wanted the response in writing to report back to the Board. Ms. Roque commented they are holding their job fair in the 17th and 18th. She thanked the CRA and particularly Ms. Coppins for their assistance putting this together. Ms. Coppins introduced them to a marketing person in Boynton Beach and with social media. The job fair will be held from 12 to 4 Friday and Saturday. She hoped to be successful for hiring people in the HOB Village. Career Source was also instrumental in getting the word out. She announced tractors are on the MILK site and they received their final permits to go to closing and start building. They have started clearing the land. F. Approval of a Purchase and Development Agreement for the Cottage District Infill Housing Redevelopment Project with Azur Equities, LLC Ms. Shutt presented the item to vet all remaining issues as contained in Exhibit D and any comments Azure may have about the Purchase and Development Agreement. The Board directed the project should be a fee-simple, owner-occupied project. Section 10- 1 contained a deed restriction for an affordability period of 15 years using 80% to 140% of the Boynton Beach Area Median Income which is lower than the County's. A site plan as contained in Exhibit D detailed what the units will look like, the size, cost and the target area median income. The development will have 40 units, with approximately 18 townhouses and a small pocket park. A contribution from the CRA will be used towards land development that will be given in increments as the project develops and the units are finalized. As for the Builder's Warranty, this agreement is with a developer, who will hire a local contractor or builder as a cure for any latent defects, ensuring the owner has recourse or that bonding be provided for any latent defects. The Board wanted the tradesmen to be local. There is a milestone for the various processes and completion of construction as detailed. There are requirements that the developer obtain financing before the land can be turned over to Azure, which is their loan paperwork. There are fees if the units are not completed. Payments will be made in four increments. The reverter agreements are only for the properties that will be not be sold if they do not perform. 14 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 Franck Gotsman, Azure, advised they changed the timeline and allocated two weeks for presale for lower income units. It usually takes 120 days for income qualification, so staff asked Azure to accommodate 120 days so people needing to go through the income qualification process do not miss out on the sale. Chair Grant asked what happens it more people qualify and apply and learned it is on a first-come, first served basis on the lower income levels and the Community Development Corporation will help them. Chair Grant favored applying a low and median-income lottery if there are more than 50 applicants. Mr. Gotsman stated they can work on that. Board Member Penserga asked how the reverter clause would work as it pertains to the bank. Ms. Shutt explained it depends on if Azure has performed or not. Azure will need financing and they hoped to receive financing before they close on the project. If the project stalls for a certain amount of time, that is when they would have to see and take recourse. The property will be platted and the large lots will be sectioned off as individual lots to be sold, so if partially sold, the party guaranteeing the product will always be in first position, which is the bank. There are some safeguards, but they may have to pay some of the cost of the improvements and they may or may not get back the entire parcel. The CRA is always in the second position. They are trusting Azure to build the project. Mr. Gotsman stated they have to install the infrastructure when they take the land, and then sell the lots. Once the lots are sold, they no longer own them. Someone owns the lots, the bank will build them, and there is insurance in case they do not finish the unit, the builder has to finish with the bank. The only issue is the homes not sold and the infrastructure on those lots. There would be lots sold already, so if the reverter was used, the bank would not receive the entire parcel. The hope is this will be completed timely and correctly and the relationship between Azure and their contractors and subcontractors remain throughout the process. Attorney Rossmell explained the reverter in this instance is not a perfect tool. There are multiple avenues for default, and this provides for one of them, but the CRA would be in second position to the bank. Board Member Penserga stated they saw pictures of incomplete projects in other cities. It made him uncomfortable as there is too much risk and he did not want to move forward. In the beginning of the project, they received multiple proposals. He asked why would the CRA chose a business deal to give the land for free. He thinks there are better deals to be had. He would only move forward if the deal could be structured that was better for the CRA. The RFQ was issued in August. Chair Grant asked if Board Member Penserga wanted single-family homes and learned he was not opposed to them. The RFP was issued in August of last year. A presentation was made in December of last year. The first team was selected around January and dropped out, as did the second ranked developer. There were three firms that were shortlisted, but the CRA Board kept changing things. Azure was working with the CRA the whole time. The Board did not want the project to be high density. Chair Grant was comfortable with the developer because they have mechanisms that prevent the CRA from losing and they are building single-family homes. They must get financing within 90 days and then they could start construction. It is correct a reverter clause is needed with Affiliated 15 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 as well. Single-family homes are different than multi-family rental properties. Chair Grant is in favor of moving forward. He did not feel risk associated with single-family home ownership is anything in comparison and the benefit to the community is 40 fee- simple homes. Board Member Penserga stated from day one he opposed this selection and wanted to choose the better deal in the beginning. He saw a better deal and was uncomfortable with this particular business deal. He commended Mr. Gotsman sticking through the process. He wants single-family homes, but after seeing photos of incomplete projects, he could not lend his support. Ms. Shutt advised the site activity improved since the last time they reported. Board Member Penserga asked how long the site was incomplete. Mr. Gotsman responded that is not fair to point to one project not proceeding for multiple reasons. He tried to set up a meeting for all his projects that were fine. From the beginning, they worked with the CRA for a project the City wanted. The incentive is because the price of the homes would be super low. They came in with a price and they have not changed the price since while others come in and request millions more in funding because the price of building materials increased. The land that is being provided is not being given to him, it is being passed on to the buyers. Vice Chair Hay hoped Mr. Gotsman's comments were correct, but also shared Board Member Penserga's concerns. He was glad the Executive Director had some positive feedback as he wants the project to move ahead. He does have questions about his history in terms of a project in Pompano Beach. It was not favorable and he had doubts. He advised he will be watching the project very closely. Mr. Gotsman explained there are safeguards in the contract. Board Member Katz noted there would be a two- two vote because Board Member Romelus, who was not present at the meeting, is in favor of the developer, as was Vice Chair Hay. He suggested tabling the item versus voting it down and Board Member Romelus would have to bring it up for . reconsideration. Chair Grant stated the developer may not want to continue it. They heard from the other developer for the Heart of Boynton Village, they gave an extra $2.5M from when they conveyed the land for free for affordable homes. It is a different structure because they are not receiving subsidized funds like they would from the Florida Housing Finance Corporation. He hoped they would move forward today, but if they are having reservations, he did not want to vote down the project. If that is the case, he will entertain a motion to table. Ms. Rogue stated she read in the Purchase and Development agreement that if Mr. Gotsman gets financing from an accredited lender, he can package the deal, give notice to the CRA and sell it. If the CRA exercises its right of first refusal, then the CRA would have to buy it back at the price he packaged the deal for and lose the land. Ms. Rogue explained the information was on page 23, Reverter Clause, then section 23.3 and B. She suggested changing the reverter clause to indicate they do not have the right to package the deal. It was noted there are deed restriction on the property. Mr. Gotsman stated the agreement specifies the property could only be sold for low income housing. Chair Grant asked if the deed restriction applied. 16 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 Mr. Swezy asked if the lender was an accredited lender or a guy who would write a letter on stationary saying he was a mortgage broker. Most RFA's he deals with are accredited, which are certified banks. He thought it was a big problem. He also was concerned Mr. Gotsman was packaging the property intending to flip instead of being built. The City would still receive the product, but would not know when. Chair Grant agreed after he sells it within the first year or so after getting financing and the developer does what he is supposed to do, someone could buy it and sit on it. Chair Grant appreciated them speaking to this issue and stated there is a fear they will sell all they have done. Mr. Gotsman stated they were working with CRA and their attorney. At no point was it considered. The lots are deeded separately and must be sold between 80% to 140% of the Boynton Beach Area Median Income. They have a timeline. He cannot sell the house for $500K if he feels like it and it is not the way the development is written. Mr. Swezy noted 140% of the AMI means a house could be sold for up to $500K. Attorney Rossmell explained the deed restrictions apply to the lots and not the entire property. Mr. Swezy stated the CRA does not have a developer who has the ability to build it. Ms. Roque stated they would sell lots and build the homes one at a time. Mr. Gotsman expressed they were being slanderous, but he agreed to review the language. Chair Grant commented the problem is that Ms. Roque submitted a letter of intent and it is not the first time Centennial has done so. He wanted to table the discussion. He thought Mr. Gotsman could speak to the dissenting Board members. Mr. Gotsman responded his attorney's will. Chair Grant commented they will see about the fear that people have regarding Mr. Gotsman get one over on the CRA or not build a project he was trying to build for the past 18 months. Mr. Gotsman thought the fear was someone trying to take the property and ask the CRA for another couple million dollars to finish the project. Hopefully they can speak to those dissenting. Ms. Roque stated they have-over $50M invested in the City. Their first concern is this is a bad agreement. Whether or not they issued a letter of intent to do what they originally intended to do there or to purchase the land for $1.9M and build townhouses without having to obtain financing and do it right away and provide 40 townhomes, they can do that. They can build a senior community, or look at a different avenue. Whether or not the Board entertains it, it is a bad idea for the City and unless he is willing to take it out, even with the way it is platted, they have lost the integrity of the property. If the deal falls through, the project is devalued. She inquired how they could build on it, or someone else will have to purchase it, or the CRA will have to buy it from the bank. Mr. Swezy stated they will then have an eyesore in the City. Keturah Joseph, Boynton Beach Faith-Based Development Corporation, asked if Centennial said the CRA attorney did not do her job correctly and they are now pointing out what is insufficient in the agreement. Chair Grant explained Centennial is saying the right of first refusal does not protect the CRA if they try to package the deal to another affordable housing builder with the same restrictions that Azure has. Ms. Joseph asked if that was the reason why they have an attorney to make sure the City is protected. They are standing here diminishing someone else's project when they have 17 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 been up here over and over, project after project and no one came here and talked bad about anything they are doing. They have come back and asked for a couple of million dollars for various reasons that was granted and now they are here talking bad about someone else's project She thought it was so undermining and ridiculous it was not even funny. Chair Grant stated it goes to the CRA attorney, that the developer they sell the property too, gets the financing and approval and fulfills their requirements, or they do not adhere to the requirements, the CRA is out because once they get the financing the bank has first rights. Attorney Rossmell agreed and stated the agreement contains a requirement that a reverter agreement be signed which states the CRA would be subordinate to any financing that is part of the arrangement that has been negotiated. She stated the CRA would be taking second position to the bank with this property. Chair Grant commented the first fear is if the developer gets the financing and does not follow through, and the second fear is if they do follow through, instead of building homes, they sell the package for someone else to build the homes with the same deed restrictions. Attorney Rossmell explained there are multiple ways to handle things differently. One way is the property can be sold as a package deal to someone else, which might be considered for the purposes of this discussion, not following through with the agreement, which would not put him in a position to not repay the bank loan, so the bank might not, in that case, have the ability to reposses the property because the banks interests are not satisfied. He may make a deal, pay the bank and that would be intact. That is a different situation than if the project were to move forward and if there was a shipping emergency where the project cannot be completed for the price, then in that case the CRA is in second position to a bank who could repossess it. There are multiple possibilities Chair Grant questioned why even do this to begin with. He questioned if all the developers they work with have to deal with financing or relied on the lottery system for financing. Ms. Shutt explained these are the first fee simple-homes they are building. In the past, the agreement did require, and the CRA didprovide options for the developer to go after subsidiary money to ensure the project will be built. She noted the Ocean Breeze and MILK Jr. Boulevard developments, there are secondary safety nets where the Board would act, for the developer to either ask the CRA for TIF or additional money within the agreement, but those deals are different as it is rentals that are heavily subsidized and not a separate entity. Chair Grant commented they have developed projects with the CDC and Habitat for Humanity. Ms. Shutt explained their obligation is only to provide the lots. The lots were either free, at cost or up to $30K per lot. This is one of the most substantial assemblages they have had. Some of the lots were done as infill and the entity that develops, the CDC or Habitat, has their own dollars and leverage and equity to complete the project so the CRA would only provide the lots or assistance with hookups. Those projects are smaller than what the sweat equity, construction and financing they bring into play. The individual owners have to get financing on their own. This project is a large assemblage that can be subdivided. Chair Grant commented they are creating subsidized housing. The CRA is not building it, so they need a developer to build it that has to obtain financing. He thought they 18 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 could put in the Purchase and Sale agreement the developer is unable to assign the property to anyone else. Attorney Rossmell explained not being able to assign the property is slightly different than the terms that may be required to get financing as generally a bank will require the property as collateral, so not assigning the provisions of the agreement, does not mean they would escape being in second position if the developer obtains financing. Chair Grant explained the fear was if he sells to another developer and not follow through with the project. Attorney Rossmell explained that language can be changed. Mr. Gotsman had no issue to put a prohibition to flipping in the contract. Attorney Rossmell explained they would revisit the language in Section 23.3 and to address it to some degree. Right now, the right of first refusal is if a developer receives an offer the CRA would match the offer. Chair Grant thought it made no sense because the CRA does not match offers which would mean the developer would make a profit and the CRA would get the land back. Attorney Rossmell explained they can remove that part of the language. If they do not sell it to an income-based homeowner, they cannot sell to anyone else or it would have to come back to the CRA in its entirety and on a lot-by-lot basis. Board Member Katz thought the language should be added. The CRA would be required to reacquire the land and the CRA would pay for whatever improvements they said they would do anyway. Mr. Gotsman was fine with the suggestions. Board Member Katz summarized if Azure offers or someone makes an offer to Azure, the CRA can purchase the property back at the cost of the improvements. Ms. Roque suggested not selling off the lots one by one. Chair Grant inquired how he planned to build the homes because he liked the developer giving the homeowner housing options which home they want to be build. Mr. Gotsman thought they could change it. They can start parcel by parcel in one corner and then the other corner. It is easier to for him to build parcel by parcel, because he does not have to install the Infrastructure all at once. Chair Grant thought if they installed all the infrastructure up front, it would be more advantageous. It is currently allowed as it gives Azure the best ability to sell as soon as possible. Ms. Shutt stated if they should repurchase anything, they would also recoup incentive funding and anything they invested in. It allows for some flexibility to sell. Ms. Roque noted section 20. 1 Purchaser shall only be obligated to construct houses that are under agreement for sale. She thought it would leave the CRA in a Pompano Beach or Davie situation. Chair Grant was fine with the provision as there are many people who want to live in this area for this price, but cannot find anything. He agreed there is an aspect of risk unless there is a developer that builds spec homes up front and they do not give the homeowners any option. They have to do it this way otherwise everyone gets the same home or townhome and then they have to wait for a buyer. Ms. Roque noted typically there are models approved already from zoning and models assigned to the lots. She thought the neighborhood should be planned in advance. Chair Grant went to Minto who had four different options and the buyer can pick what they want in your location. It is a subsidized model situation. Ms. Roque stated there was no disrespect intended, 19 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 but thought it needed a lot of tweaking and the Board and community needs to be protected. Board Member Katz appreciated the comments and thought valid points were made. Motion Board Member Katz moved to table the item pending the changes and meeting in January. Vice Chair Hay seconded the motion. The motion passed unanimously. G. Discussion and Consideration of the Purchase of Green Acres Condominiums Property Ms. Shutt stated this item was Mr. Brian Fitzpatrick's offer to sell the 409 E. First Street property for $500K. The Board discussed it and offered no more than $350K based on past purchases and square foot valuations. The Board also considered Mr. Fitzpatrick's offer to sell the Greenacre condominium properties. It has 10 units, nine of which Mr. Fitzpatrick owns. Staff received appraisals for both the Greenacre site priced at $1.8M and $183K for the 409 E. First Street. The Board instructed staff and offered the property owner the chance to package the two properties together. Chair Grant looked at the appraisals. The problem with appraisals is the first appraisal was on vacant land and the other as affordable housing, which severely reduced the land. Chair Grant looked at the surrounding land the CRA is buying. The homes the CRA purchased on NE 1 st Avenue and NE 1 st Street that would be demolished had a $40 and $55 per square foot price point. When they look at the Oyer property for the .411 acres at mixed- use high, it was $200 a square foot to tear things down. The appraisal is the market value for the land, not for the market value to the CRA for future construction. He asked if Mr. Fitzpatrick wanted to make an offer to sell the combined properties. Brian Fitzpatrick, 409 NE 1St Street, stated he sent an email to the Board, which was the reason for his conversation with the Chair. At the October meeting, the Board asked him for a package price and directed staff to have appraisals done. He asked that Vance not do the appraisal, but this is a much different situation and they failed him on vacant lots. He met with City staff, the Building Department, and he was represented by Bradley Miller ofUrban Design Studio . Without any zoning changes at all, he was authorized to build six attached units using the 25% affordable housing bump. Prior to appraising the property, Vance never contacted him and said he could only build two duplexes. He was unsure what the cost difference was. When they appraised the Greenacres Condominiums, they also did not contact him at any point. This block was discussed with the YMCA, the former Assistant City Manager, and Mark Hefferin from E2L Real Estate Solutions and they proposed a seven to eight-story project, a 40K square feet YMCA, 6K to 8K square feet of mixed use, and 90 to 100 apartments. That is on the entire block of which Greenacres Condominium is half of the block on the north side. 20 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 Regarding the Oyer property and that appraisal, the company did a fine job. He contacted them and paid them to do the appraisal, but they were too busy. He also emailed them and requested an appraisal on the Greenacre property, which was not done either. When they appraised the Oyer property, they had made a comment there were no corners. The Greenacres parcel has four distinct corners by Fire Station No. 1, the new District Energy Chiller Plant, it directly faces the Schoolhouse Children's Museum, and the new City Hall. He sent the Board a copy of an appraisal done by Valbridge Property Advisors in 2018 and the parcel in question is directly west of Greenacres Condo consisting of 1.09 of an acres and it was valued in 2018 for $6,150,000. In 1986, he started buying those units, putting that together. For this property to go to the next level, he would sell both properties for $3M. Chair Grant noted a recent sale on MLK Jr. Boulevard was vacant land for $8.42 per square foot. The appraiser stated he would use it as a marker and give them $11 a square foot. Chair Grant is trying to convince the Board they pay higher than the previous market value is, because they understand the package. If they do not buy the 409 NE 1St Street, the $268K purchase the CRA paid for the 407 NE 1St Street is almost worthless and will be more of an expense in the future. They cannot purchase the land this year and it would have to be an option contract, if they do not pay for it in a certain amount oftime , they keep the deposit, similar to Michael Weiner with the post office and office building. If Mr. Fitzpatrick's offer is for $3M within the next 3 months, Chair Grant was not amenable. If Mr. Fitzpatrick wants the CRA to buy the 409 property to be put with the 407 NE 1St Street property, it should be discussed separately. The appraisal for the Greenacres site was $65 a square foot. He questioned how they would compare it if they are giving the land to the south of it for free. He asked what the CRA had to spend for the Greenacres site. Mr. Fitzpatrick would like to close on a vacant lot this year, but can wait on the other lots for two years. He commented if they are deferring the purchase for two years, there should be a percentage increase per year. Chair Grant requested Board input to see if they were willing to purchase the 409 NE 1St Street property if they do not have a package deal and combining the properties to expand the Cottage District or giving it to an affordable housing development, they can consider it today. He thought, regarding Greenacres, there are two applicants with a LOI, and if they decide to do something, the Greenacres properties may not be valuable to the new owner of the property at 211 E Ocean Avenue. Board Member Katz asked what the sale value of the property of the $3M was and learned it was $2.7M for Greenacres and $300K for the vacant lots. If they close on one, he would like to increase it $500K and then $2.5M for Greenacres. Mr. Fitzpatrick stated the appraisal letter had no supporting documentation. Ms. Shutt explained staff received an email from Vance Appraisal who provided emails sent to Mr. Fitzpatrick at Comcast.net on two occasions, which were not answered. The email address was wrong. They will provide the full report, but due to the time crunch, they could not get an opinion for the meeting, which staff will share when received. Board Member Katz did not think anyone would pursue the 409 property soon, and this has more strategic value versus being adjacent to another property they own for infill. 21 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 He would not mind pursuing either as a package deal with this first and structuring the payments as they did with the post office, because there is a fair value between the appraisal and the $3.5M. If that project comes to fruition under his vision, there would be understanding of the symbiosis of the two properties even if Mr. Barber takes possession of the Magnuson House. He would feel comfortable structuring a deal when they know they own this land when they work with Mr. Barber so the properties complement each other and what he does there does not give a bad face to the next property when they can fit like a puzzle. If the $2.7M is within the fair value based on a more accurate appraisal, he was not opposed looking for a different appraisal if it was not looked at for a future use. Ms. Shutt explained the executed agreement for the 217 property allows for a $200K deposit to close by 2023, so the lease with the existing tenant will be done. Mr. Fitzpatrick had stated if an agreement is executed, he will have all 10 units under site control. Chair Grant suggested tabling the item to the next meeting. Motion Board Member Katz moved to give terms to the CRA and to direct staff to engage with Mr. Fitzpatrick to have two versions which would be a two and three-year version. If they do not pay immediately, they include a CPI increase in there. Board Member Penserga seconded the motion. The motion passed unanimously. (Chair Grant recessed the meeting for a short break at 8:49 p.m. and reconvened the meeting at 8:53 p.m.) H. Discussion and Consideration of Florida Technical Consultants, LLC's Letter of Intent for the CRA-Owned Property Located at 211 E. Ocean Avenue (TABLED 11/0912021) Motion Board Member Penserga moved to remove from the table. Vice Chair Hay seconded the motion. The motion passed unanimously. Mr. Barden, Florida Technical Consultants, stated they presented their idea a few months ago. He had withdrawn his bid, but added he wanted to stay in Boynton and maintain the building. He did not submit a site plan as he did not see changes, just refurbishing the premises. Since the first meeting, they reviewed alternative uses. He was associated with food establishments on the bottom floor in the past, but it was not really consistent with his business model. They had discussed making a cash offer or services, which was not in the CRAs vision for the property. Mr. Barden stated what they are offering has value. He had investigated training facilities in the building and 22 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 spoke about utilities and whether they would be willing to hold training sessions and the response were so positive they will get a program together. Parking would not be increased as they were training one person at a time. If they did one training a year, at $50K a year, with five years would add about $7.5M in revenue. He feels he owes a lot for Boynton Beach, but did not want to withdraw. Chair Grant noted they have future developments coming in and they want to speak to the developer as the CRA has tenants for them. In Casa Costa, most of the tenants are no longer there. The CRA has to be mindful when working with developers that commercial tenants on the first floor have access to the customers, and with Mr. Barden having office space, he hoped to help them with new office space. There are office condo's but he did not know if they were for sale. Mr. Barden advised they are visible and a training facility would be a regional facility attracting a lot of people to the City. He will be involved in the CRA and investigating properties, but they must move fairly soon. Chair Grant commented Seacrest Boulevard may be able to accommodate a commercial office in a residential area. He hoped the City Commission could look into that to allow office commercial zoning along arterial roads. Chair Grant stated Mr. Barden can make his request for an extension of more than 90 days in January if the Board owns the Oyer property. I. Discussion and Consideration of a Letter of Intent from the Barber Family Companies LLC for CRA-Owned Property Located at 211 E. Ocean Avenue Ms. Shutt advised in November this item was postponed to allow the applicant to meet with the staff and discuss terms. The Board's direction was to either pursue a lease agreement or a purchase and sale. Mr. Barber gave terms after their meeting on November 12th, and he proposed to acquire the 211 E. Ocean Avenue property for $420K. He would need a $50K CRA Commercial Improvement Grant for a new container restaurant concept, and $200K in TIF. He provided a letter from an investor, Rodney Mayor, who states he can fund a $1M in renovate the Magnuson House, which would cost about $420K to convert to a restaurant use and there is a $240K cost for the shipping containers, which includes mechanical, electrical and anything else needed to convert them to restrooms, a bar, a store and kitchen. The remaining costs would be miscellaneous site costs for outdoor seating, parking as needed and delivery needs. Originally there were in-kind costs to provide free meals to the homeless and children, which were not needed as the project would be fully funded, but the CRA asked for the entity the CRA would contract with. He provided copies of his application to the Division of Corporation for the 211 E. Ocean property. Staff commented the request for TIF is small and the CRA could probably budget for it, but they feel with Mr. Mayo as a guarantor, the CRA would need to ensure they vet Mr. Mayo as he is not a traditional lender and he would be a party to the agreement as the guarantor. Mr. Barber confirmed Ms. Shutt's comments and advised Mr. Mayo was present. They want to revitalize the property and make it a destination. He had conceptual drawings based on meetings with the Building Department. 23 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 Chair Grant stated the Board had prior concerns about risk if the project does not go through. The CRA is selling the property for $240K less a $50K economic development grant and $200K in TIF, so is not getting $240K as it would be given back to the developer over time. Mr. Barber commented, based on conversations with staff, it would be cumbersome and the CRA Board, as a whole, would have to direct staff and other resources to manage the offering of services as the CRA would have to tally Mr. Barber's provided in-kind services. Chair Grant agreed. There was certain TIF payments in the past for affordable housing, and if they did not include affordable housing, they did not get TIF. Mr. Barber's proposal would save the Magnuson House, but it does not include parking as parking attaches to the Town Square parking. Chair Grant asked if they could sell the building with parking in the Town Square and learned they could. Thirty parking spaces would be attached to this site. It is tied into the Town Square, but Planning and Development Staff advised there were recent zoning changes to accommodate redevelopment of parcels and there could be a minimal amount of parking required for this parcel. She had to defer to Planning and Development staff about parking as it is lacking without parking in the garage. Rodney Mayo, part of the Subculture Group, advised they have 16 restaurants, bars and coffee shops between Jupiter and Miami. This restaurant would be a partnership. It would fall under the Subculture Group, and the buildout would be a business loan. Chair Grant asked if the loan was be secured by the property or under Mr. Barber as a guarantor. Mr. Mayo responded it would go to the property. If Mr. Barber gets the property and the business does not go through, Mr. Mayo could foreclose on the property and end up owning it. Mr. Mayo explained they are partners in the restaurant as well as the property and it is a joint venture. The title does not transfer until the renovations to the property are done and they receive their Certificate of Occupancy. Chair Grant commented the CRA spent $850K for the property and it is currently appraised for $800K. They want to protect the taxpayers. They want to sell the property and have assurances they have a restaurant because they had bad experiences selling property for restaurants. Mr. Barber wants to activate the space. Anything besides that is way beyond what they want to do. In the foreseeable future, barring major disasters, there will be a restaurant on Ocean Avenue. Ms. Shutt explained they have submitted a timeline for the development agreement, similar to the Boynton Beach office condo, which was 14 months from the time they submit application . It will have a different timeline that can be worked into the terms by dates and not by months. Allen Hendricks, site planner, explained they have two seasoned restauranteurs, they are not going on the development side to be dragging their heels. Chair Grant explained the reason why the CRA has the property is they gave it away twice and the reverter clause came back because those restauranteurs could not make it work. Chair Grant asked if they checked on the impact fees from a single-family residential building to commercial. The County knows about impact fees because the former owner tried to expand a restaurant and it cost over $100K. They got a structural engineer to clarify how much money and work to do on the house itself and he suggested they add that to the cost. They know the cost of most of the rest. 24 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 Board Member Penserga spoke about this project before and asked what happens if it does not work out. Mr. Mayo responded the investment in the property is the sustainable factor to ensure it will be a restaurant. Once improvements are made, it is a restaurant. If the restaurant is unsuccessful, it would still be a restaurant. Mr. Mayo explained he owns the Dada eatery. They are expanding and opening six restaurants in the next 12 months. That takes precedence. He advised he is a history buff having renovated the original Salvation Army building and he likes renovating old buildings. Mr. Mayo was comfortable with 14 months from permit issuance to build out and then open eight months after issuance. Board Member Katz supported moving forward and did not object to giving the land. He wanted some provisions, such as a deed restriction, if they get the parcel behind it. He wanted a right of first refusal if they decided to sell within a certain number of years after opening. They cannot sell for a certain amount of time and any incentives, if sold he wanted the CRA to be able to recoup. He also praised Board Member Romelus as she wanted to provide the land. Chair Grant asked if the Magnuson House had a historical designation and learned it was under Local Historic designation. To remove the designation, it has to go before the Historic Resource Preservation Board and the City Commission. Chair Grant asked if they want the $240K up front or as a contingency as they are asking for an Economic Development grant and TIF, which means the Board can oversee what is done in the next five years. he thought it made more sense to sell the property as it is, with the best-case scenario and then giving it back to them over the next few years. He asked for Board input and hoped to have a first draft in January and signed in February. Board Member Katz asked where the Board stands with the City regarding the use of shipping containers. Ms. Shutt responded the City is open to the concept, but more details are needed. It respects the existing historical structure. If there is a porch or other appurtenances to the structure, it must keep with the period and complement the existing structure. They requested any new structure be in the rear. They must meet the site development requirements with respect to-access, parking and renovation of the building be subject to the Building and Fire Codes. Board Member Katz advised the applicants not to let staff force them to rewrite major aspects of the project until the CRA or City Commission has seen it. It was important they should make sure the Board sees the actual proposal before staff says they cannot do something. Motion Board Member Penserga moved to accept the Letter of Intent and direct staff to come back with a Purchase and Sale Agreement with a few options and research how much the impact fees would be. He suggested sun shades may not be the best to aspect to keep things within the time frame. Vice Chair Hay,seconded the motion. 25 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 Attorney Rossmell sought direction on the motion. Chair Grant appreciated the offer of $240K for the Board to redistribute back, but the Purchase and Sale agreement could have restrictions, certain design features could be included, and to allow them to apply for the $50K Economic Development Grant. Mr. Barber requested confirmation they just go into agreement that is deeded to them for other considerations and other improvements on the property. There were no online comments'received. Vote The motion passed unanimously. J. Discussion and Consideration of Lease Terms with C Life C Food, Inc. for the CRA-owned Property located at 40.1-407 E. Boynton Beach Boulevard Ms. Shutt stated last month there was a deadline for staff to give the current draft by the 19th and Mr. Collins to respond back with comments on the lease agreement by December 3rd. They have the latest comparison to what Mr. Collins suggested which she reviewed. Mr. Collins had comments that were not part of the original agreement. Staff only agreed with two comments as they are leasing the property below market rent and in return they are trying to support a Boynton Beach business operate in the City, which were items 15 B.4 and item 15. C. Staff recommended the Board reject the other changes. Staff is also still waiting for the commitment from the funder (investor) Mr. Collins alluded too, to be able to make the improvements and activate the use. Staff was also supposed to forward a timeline for the completion of the CRA's part of the parking lot. This has been incorporated into the draft agreement. Staff does not recommend moving forward unless they have all the items they requested. Board Member Katz commented the request for financing needs to be fulfilled by the next meeting. If there is no documentation for the tenant to fund the project, this is all a waste of time. He thought when they left the last meeting they finalized the terms conceptually, and now there is another list of 15 or 20 recommendations. He supports the two agreed on changes that staff reviewed and that is it. He wants to see the financing and move forward with it. Mr. Collins commented they got the funding themselves for the improvements and they can supply that information and the commitment letter. The next step was to receive a new draft copy of the lease, which was submitted at the last minute. In reference to the sub-leasing and subletting, it was discussed with the Board Chair regarding considering the Surfing Hall of Fame and he had no issue taking the subleasing out. He had no feedback on what they submitted and none of that was brought to his attention that it was needed for this meeting. Mr. Collins took exception to the CRA reaching out to his architect and receiving drawings that he paid for without his permission. He wanted to move forward and noted the CRA gave a nine-month window for the parking lot. He was amenable to what the CRA wanted to do. Board Member Katz explained the CRA was 26 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 paying for the parking lot and has specifications they have to fulfill subject to the grant. Ms. Shutt explained the drawing was the same drawing. It was a PDF drawing that he had previously submitted to the Board. The CRA wanted to ensure it was the latest drawing. Chair Grant explained they would review the changes line by line. The first proposed change was item 2.B. Staff recommended the Board reject this item. Mr. Collins agreed with the lump sum with the annual payment. Item 2 C pertained to with cause. He asked if the current lease say if they give him four months notice after he builds it in the second year, they can terminate with no reason whatsoever. Attorney Rossmell responded it did. Chair Grant asked if Mr. Collins agreed with the item. He could have 16 months. Mr. Collins commented that was a deal breaker. Board Member Katz commented this provision was the entire premise of the agreement from day one as the Board wanted maximum flexibility and this is a radical departure from it. If the willingness to take that risk no longer exists, to him the deal no longer exists. Chair Grant thought there was somewhere in the middle there was a possibility in the third or fourth year the CRA can terminate within 120 days without cause, but if the Board does not want to see it that way and the CRA is only guaranteeing 16 months as a tenant, he thought they should offer more than 16 months at a minimum. Board Member Penserga noted the understanding was always that this was temporary and Mr. Collins said he would never want to be in the way should there be another development project. A compromise is if the CRA does something else with the property, another landlord has the right to terminate within 120 days without cause. Board Member Katz asked, about the definition of cause. Attorney Rossmell explained cause generally means breach of contract on Mr. Collins' part or acting outside of the contract, not that the Board changed their mind. The Board could condition a lease upon a sale of the property and the new landlord can terminate the lease within 120 days. The Board cannot put in the lease they have the right to terminate only with cause and expect to be able to change their mind about a tenant. Board Member Katz commented all was predicated on the flexibility of the CRA Board now and in the future, but he did not want to restrict the, Board's ability. Chair Grant suggested they meet in the middle. Board Member Katz commented this changed the entire construct. Ms. Shutt explained this draft was provided by Mr. Simon based on the initial discussions of the lease agreement in June. Vice Chair Hay,did not think they would give 16 months notice until there was an accepted LOI or RFP. Then the clock begins, not just on the premise of an LOI. Chair Grant stated the acceptance of the Board would give him 120 days. Board Member Katz asked if language could be included signifying that by signing it he waives his right to sue. Attorney Rossmell explained it could be written in the contract that acceptance of an offer or a formal Board decision on receipt of an LOI signing is acceptance of an 27 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 offer or a formal Board decision to dispose of the property via LOI or RFP and the determination that the property is to be disposed of is the trigger. The original contract was the CRA receives an LOI that the CRA has no intention of following through. It could be written into the contract that receipt of any LOI or any other offer to purchase the property, is a cause sufficient to terminate the lease agreement. That would be the only cause. Board Member Katz did not want to tie that hands of the future Board. Board Member Penserga understood Mr. Collins' stay would be temporary and he would vacate when the CRA has a redevelopment opportunity. He thought it was a fair compromise. If there is no redevelopment opportunity why should he leave. He would support that suggestion if they proceed with an RFP or accepting a LOI, then and only then the clock will begin. Chair Grant wanted to hear Mr. Collins speak on the option of with the sole cause of the CRA disposing of the property, and other breaches of the contract. Mr. Collins advised he put the LOI together to give the CRA maximum flexibility so if someone acquired the entire block, he would get out of the way. He did not want to be sent a letter to vacate without having a reason to do so. Chair Grant noted that could happen as soon as month 12. Mr. Collins noted the laundromat had seven years on their lease so it may not be soon. Chair Grant noted he spoke to the laundromat in 2019. Chair Grant wanted to ensure that Mr. Collins understood the 120-day notice could be at month 16. Chair Grant requested confirmation Mr. Collins understood that if a future CRA Board is'planning on selling the property, he will have 120 days to vacate. Mr. Collins wanted it to be on successful sale of the property and not when the CRA intends to sell. Chair Grant asked for Board input if it would accept if the CRA Board transfers title, the tenant has 120 days. Mr. Collins advised if they got to that point, he would not have a problem moving out or negotiating with the new owner to remain until the owner is ready to demolish the building. Chair Grant noted the Board did not accept the counter and asked if the Board would accept it with 120 days of the Board Notice of Intent of issuing an RFP or accepting a LOI. The Board has normally given four months. If the CRA accepts a LOI or issues an RFP, with either option, he will have 120 days to leave. Mr. Collins advised he would accept it if this would occur in three years. Chair Grant said no. Board Member Penserga commented Mr. Collins knew from the beginning this was only temporary. He will accept it as long as it would be with the notion they would be tenants for quite some time. Attorney Rossmell commented the issuance of an RFP or acceptance of a LOI, or otherwise manifests an intent to dispose of the property, upon that, the CRA will have the right to issue a 120-day notice. Chair Grant explained he will have to review what the CRA Attorney provides and they will have the opportunity to look at it next month. There was agreement on 2C. Mr. Collins agreed to not assign the lease. There was agreement on Item 5. Mr. Collins agreed not to sublet the premises 28 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 There was agreement on Item 6B with 60 days. There was agreement on Item 7 as written. It is the tenant's responsibility to conduct due diligence on the property. The tenant is responsible for roof repairs and he accepts the building as is. Normal wear and tear will not be included in the language. There was agreement on Item 8. All alterations will require CRA approval. As to fixtures, the fixtures will stay unless the CRA agrees at the time of installation the fixture can come out when Mr. Collins leaves the building. There was agreement with Item 9. Mr. Collins was okay paying real estate taxes, triple net and the insurance and maintenance, plus monthly rent, which is involved in a triple net lease. Under the current contract, rent is just rent, and Mr. Collins is responsible versus remitting the insurance and remitting the taxes to the CRA inclusive of the rent. They are separate. Mr. Collins preferred to pay the larger amount and the CRA pay the taxes and insurance and Mr. Collins pay whatever the amount is, rather than him being responsible for a lump sum payment on the property taxes every year and the insurance. Chair Grant stated the CRA will determine those costs and add it into the rent next month. Taxes can be prorated. If the Board wants staff to go back when to include taxes and insurance and maintenance as triple net, they need to be clear what they are asking of staff. Board Member Katz did not support this, he supported what was previously negotiated and discussed otherwise the CRA will now become the middleman between the property tax and insurance and each time the property tax or insurance goes up, they have to recalculate it. He does not support trying to add in in and recalculate and readjust on an annual basis as it complicates matters for no reason. Mr. Collins advised he never had to do that and it was one of the reasons he paid a lump sum as the rent was raised a certain percentage each year. Chair Grant pointed out there will not be property taxes the first year. Mr. Collins will have to pay property taxes on a pro-rated basis for 2022 and pay the insurance in a lump sum for 2022. Mr.. Collins agreed to these provisions. There was agreement on Item 12. The CRA accepted the language Mr. Collins submitted. There was no change in Item 15 A.2. The Board wanted a lump sum payment except for the monthly rent. Mr. Collins agreed to Item 12.A.5. Attorney Rossmell recommended not accepting the change in 12.8.4. and not limiting, by any manner, the default by tenant. The Board would not limit this to Item 15.A only. Item 15.A.3. says the tenant has 30 days to correct for items pertaining to non-payment of rent. Chair Grant queried if a default occurs, and the CRA gives notice, if the CRA 29 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 has to give 30 days or wait any time after 30 days. The Board can give notice and the tenant has 30 days to correct from the date of the notice and if they make reasonable efforts to start to cure the matter within 10 days, it would add some time on. Chair Grant clarified if the CRA does not receive rent on the 1St of the month, they cannot go in until the 11th, not when they do not pay on the 2nd or 3rd day of the month. 12.8.4. All the remainder of rent is due if the termination of lease is given if there is a default. Mr. Collin's Item 12. C. was accepted by the CRA. Item 15.D. was rejected by the CRA. Item 18 was acceptable with 15 days and not five days. The signature line showed Lucinda McGraw to sign as president of C Life C Food. The CRA was asking for a personal guarantee, and Mr. Collins was not. The CRA wants - both individuals to act as guarantors for the lease for C Life C Food. There is guarantor language in the contract so they need to be identified. The CRA wants a personal guarantee, not just the agency Mr. Collins created. Attorney Rossmell noted the guarantee language was in paragraph 28. Chair Grant requested a motion to approve, subject to the attorney's revision and to adopt as modified. The Board can have another review of the lease in January. Motion Vice Chair Hay so moved as modified. Board Member Katz seconded the motion. Chair Grant stated a draft will be created. Board Member Katz commented the item is done with review and he does not want to see more comments based on the new draft. Ms. Shutt advised proof of funds will be included if self-funded. Mr. Collins advised he can provide the documents by December 30th. It was noted the first amount discussed was for $150K for the parking lot and the building. Mr. Collins stated earlier he was investing $100K. Whomever is investing funds for the building renovation and activation of the space would have to provide proof of funds. The item will be brought back to the Board in January. Vote The motion passed unanimously. K. Project Update for the Purchase of the Properties Located at 511, 515 and 529 E. Ocean Avenue Ms. Shutt announced they are proceeding to closing on the loan for the property on Thursday. Chair Grant will sign the documents. If any tenants want to have a discussion with the CRA about the property, it should be done in January. 30 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 L. Update on 115 N. Federal Hwy Infill Mixed Use Redevelopment Project Negotiations with Affiliated Development, LLC (This item was heard earlier in the meeting.) 17. New Business A. Consideration of Contract Award for the Request for Proposal (RFP) for the Insurance Broker of Record for Property and Casualty Insurance Program Vicki Hill, Finance Director, advised staff issued an RFP and there was one response. The broker was present earlier in the meeting. The request was to approve the award and direct staff to commence negotiations with them and authorize the Chair to sign the contract subject to final legal approval. Motion Board Member Katz moved to approve. Vice Chair Hay seconded the motion. The motion passed unanimously. B. Discussion and Consideration of Interlocal Agreement between the CRA and the City for Partial Funding of Economic Development Plan Performed by Florida International University Motion Board Member Katz moved to approve. Vice Chair Hay seconded the motion. The motion passed unanimously. C. Consideration of the Revised CRA Human Resource Policies and Procedures Manual Ms. Hill advised staff needed to clear language with Legal and staff is now asking the Board to approve the change. Motion Vice Chair Hay moved to approve. Board Member Katz seconded the motion. The motion passed unanimously. 18. Future Agenda Items A. Consideration and Discussion of Extension of Time to Begin Construction on the Bride of Christ Daycare Center at NE 10th Avenue B. Project Update for the Boynton Beach Boulevard Complete Street Project 31 Meeting Minutes Community Redevelopment Agency Board Boynton Beach, Florida December 14, 2021 C. Project Update for the East Boynton Beach Boulevard Extension Streetscape and Parking Improvement Project 19. Adjournment Motion There being no further business to discuss, Vice Chair Hay moved to adjourn. Board Member Katz seconded the motion. The motion passed unanimously. Chair Grant wished all a Happy Holiday and New Year. The meeting was adjourned at 10:58 p.m. Catherine Chery Minutes Specialist 32