On the agenda

1. 1Call to Order - Roll Call▶ 0:00
2. 2

   Approval of July 18, 2023 CRA Meeting Minutes

   approved

   The CRA Board approved the minutes from the July 18, 2023 meeting.

   • motion:Approve the July 18, 2023 CRA meeting minutes. (passed)

   #July 18, 2023 CRA Meeting Minutes

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   [00:00:30] Approval of the July 18, 2023 meeting minutes? [00:00:36] Move for approval. [00:00:38] Need a second? [00:00:38] Second. [00:00:39] All those in favor? [00:00:41] Aye. [00:00:42] All right.

   This text was generated automatically from the meeting video. It is not a verbatim or official record. For exact wording, consult the video or the city clerk.

3. 3

   ↳You arrived here from a search for “US Highway 19 Main Street Southeast Corner Gateway Courtyard Project” — transcript expanded below

   Review of the FY2023-2024 Proposed Budget

   discussed

   CRA staff presented the proposed FY2023-2024 CRA operating and capital budget totaling approximately $11.77 million in revenue, including TIF from the county and city, ARPA funds for the Railroad Square project, and other sources. Discussion covered residential incentives for rehabilitating foreclosed properties, debt service on multiple bonds, the parking garage maintenance shared with the Hacienda Hotel and Kaiser University, and potential acquisitions including the Shwetman building. A board member raised a legal concern about CRAs using funds for marketing and asked the attorney to review.

   📍Cavalier Square📍Main and 19📍Railroad Square📍River Road church property📍Shwetman building🏢Hacienda Hotel🏢Kaiser University🏢SunTrust👤Crystal👤Ms. Dunn#2016 refunding bond#2020 series bond (parking garage)#American Rescue Plan Act (ARPA) funds#CDBG grant#CRA Redevelopment Plan update#Cigar warehouse property#FY2023-2024 CRA Proposed Budget#HUD grants#Main Street Entryway Signature Feature#Property Assemblage#Railroad Square Improvement Project#Series 2022 bond (SunTrust building)#Streetscape Improvement Project#Tax Increment Financing (TIF)#US Highway 19 Main Street Southeast Corner Gateway Courtyard Project

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   [00:00:43] OK, a review of the fiscal year 2023-2024 proposed budget? [00:00:51] Community redevelopment agency operating budget [00:00:53] and the capital project budget as well. [00:00:56] And Ms. Dunn has prepared a PowerPoint, [00:01:02] which we'll start off with. [00:01:08] No. [00:01:10] Try Dale's. [00:01:25] Is it working now? [00:01:26] No? [00:01:27] Yes. [00:01:27] Crystal, you got it. [00:01:34] So tonight's presentation will be the community redevelopment [00:01:37] agency's 2023-2024 proposed budget. [00:01:44] Beginning with the organizational chart, [00:01:46] we have the city manager and the economic development director [00:01:49] with the senior administrative assistant and marketing [00:01:52] manager. [00:01:53] The marketing manager is the one full-time position [00:01:55] within the department, and 25% of the city manager's salary [00:02:02] is also allocated to that budget. [00:02:10] Various revenue sources that fund the CRA, the tax [00:02:15] increment from the county, which is based on the 7.6076 millage [00:02:20] rate, which hasn't changed year over year. [00:02:22] So that will bring in $3,636,470. [00:02:28] We're also budgeting use of American Rescue Plan Act funds [00:02:32] of $2,550,000, which will be the funding source for the railroad [00:02:39] square improvement project. [00:02:41] Rents and royalties of $60,000. [00:02:44] That's rent received on city-owned property. [00:02:48] Surplus land sales is a projection of property [00:02:52] to be sold, which is currently owned by the CRA. [00:02:56] And contractual contributions of $118,380, [00:03:02] which consists of the contractual obligation [00:03:06] as a reimbursement from the hotel and the university [00:03:10] for their use of the parking garage. [00:03:13] We also have budgeted the transfer [00:03:15] from the general fund TIF, which is $4,039,140. [00:03:21] And that's based on the proposed millage rate of 8.45 mills. [00:03:29] We are also budgeting a rollover of prior year [00:03:31] funds of $1,011,580, bringing the total revenue for the CRA [00:03:38] to $11,765,570. [00:03:48] Personnel costs associated with the division. [00:03:52] Again, it's 25% of the city manager's salary, [00:03:55] as well as the marketing specialist, the marketing [00:04:00] manager's position. [00:04:02] We've also allocated a small portion of the marketing [00:04:07] specialist from another department [00:04:10] to assist with marketing currently for the department [00:04:13] until the other position is filled. [00:04:16] And then the various expenses associated [00:04:18] with those employment costs. [00:04:23] May I stop you? [00:04:24] Sure. [00:04:25] Marketing has become a major legal issue for CRAs. [00:04:32] I don't know if it's been researched or not, [00:04:34] but their opinion of the opinion of the attorney [00:04:39] for the Redevelopment Association [00:04:40] and a number of legal opinions have [00:04:44] indicated that marketing is an unallowed use of the CRA [00:04:49] dollars. [00:04:50] So I would ask that the attorney examine that. [00:04:56] It can certainly cause trouble, because it's been called out. [00:05:02] So events and marketing have both been, [00:05:07] I guess, have been the result of a change of the law in 2019, [00:05:12] which indicated that you shall only [00:05:15] use the money for certain things, [00:05:17] instead of may only use them for certain things. [00:05:19] So CRAs for many years did marketing. [00:05:22] They're not allowed to do it anymore [00:05:25] under some lawyers' opinions. [00:05:27] That doesn't say I'm not willing to listen to our lawyer [00:05:30] give us a different opinion, but I'm just [00:05:32] pointing that out, that it's pretty widely being debated now [00:05:37] and worth an effort to take a look at it. [00:05:43] Yes, ma'am. [00:05:47] I apologize for how small it is, but you all have copies. [00:05:52] For the total operating, the total operating budget [00:05:57] is $2,383,880. [00:06:00] And within these line items, it consists [00:06:03] of various operating accounts. [00:06:07] We have a portion of the city attorney's fees [00:06:09] that's allocated to the fund. [00:06:11] We have the planning services and planning, [00:06:15] I'm sorry, professional services, the planning portion, [00:06:18] and the professional services miscellaneous. [00:06:23] We did decrease professional services planning, [00:06:26] but we do plan to use a portion of that [00:06:29] towards different development projects [00:06:32] within the CRA in the upcoming year. [00:06:35] Ads and marketing, we did decrease $50,000. [00:06:41] That consists of marketing, whether it's [00:06:44] brochures or TV marketing, billboards, various marketing [00:06:49] material. [00:06:54] We increased data lines a small amount, [00:06:57] just to account for economic increases. [00:07:04] That also goes same as for electric city facilities. [00:07:07] We increased from $6,220 to $8,000. [00:07:12] And we also increased maintenance buildings [00:07:16] and grounds, which consists primarily [00:07:19] of the landscaping cost for the various city and properties, [00:07:22] increased from $4,000 to $5,000. [00:07:27] We did budget for repairs to the central garage for $1,000 [00:07:32] for estimated repair costs to the golf carts [00:07:37] and other transits that we have associated [00:07:40] with the parking garage. [00:07:45] Decreased printing and binding by $500. [00:07:48] We increased development incentives to $1,550,000, [00:07:54] and also residential incentives to $500,000. [00:08:00] We decreased other charges down to $2,000. [00:08:05] And we did increase software to accompany [00:08:08] for the various software expenses [00:08:11] that we incur within the CRA. [00:08:15] We did increase program costs. [00:08:17] And those program costs were associated with the cultural [00:08:23] programming. [00:08:24] Yes, the cultural programming associated [00:08:30] with Cavalier Square and Railroad Crossing. [00:08:35] That covers the operating budget. [00:08:36] Do you have any questions? [00:08:38] Residential incentives that you have here, [00:08:42] is that separate and apart from what I had understood [00:08:49] was to be a grant? [00:08:52] Or did we not get that CDBG grant that was related? [00:08:56] There was a housing, there was money [00:08:59] I thought we were getting for housing at some point. [00:09:01] Did that turn into sidewalks? [00:09:03] No, we received both grants from HUD. [00:09:07] This is in addition to, we would like [00:09:09] to establish a fund so that we could [00:09:14] do a couple of different things to help upgrade [00:09:16] the residential housing stock. [00:09:19] And it would be used on properties [00:09:23] that the city foreclosed on to fix them up and bring them [00:09:26] to a suitable condition so that they could be put back [00:09:30] on the market and sold to people that want [00:09:34] to own homes in the city. [00:09:37] For example, do you want more explanation? [00:09:41] No, I see the revenue was in there [00:09:43] for sale of excess property. [00:09:46] So I guess that's your expectation, [00:09:47] is that the sale of CRA land, which [00:09:51] was a $350,000 revenue surplus land sale, [00:09:58] should that be where you would get the revenue side? [00:10:01] No, we're actually expecting that [00:10:02] to come from payments that are due to us [00:10:05] from the Hacienda Hotel. [00:10:10] I misspoke when I represented that. [00:10:13] No, no, that's good to know. [00:10:16] So we might see some more revenue [00:10:17] after we do these houses, fix them up, and sell them. [00:10:20] As with a lot of the other things [00:10:22] we're doing that are public-private that we're [00:10:24] investing in, whether it be the attenuation pond on Main and 19 [00:10:29] or anything else. [00:10:31] That money might come out and then go back in. [00:10:34] Yeah. [00:10:35] That's what we were hoping will be the case. [00:10:36] Keep turning it over and making improvements around town. [00:10:40] Right. [00:10:40] Good. [00:10:42] Thank you. [00:10:43] Designated neighborhood improvements, [00:10:44] things like that. [00:10:45] Thank you. [00:10:48] Any other questions? [00:10:50] No. [00:10:51] Then we move into the capital projects [00:10:53] that we also discussed earlier. [00:10:55] We have the railroad square improvement project [00:10:57] of $2,550,000, the streetscape improvement project of $125,000. [00:11:05] We have property assemblage budgeted for $1 million. [00:11:08] And the Main Street entryway signature feature for $530,000. [00:11:14] And the US Highway 19 Main Street Southeast Corner gateway [00:11:18] courtyard project for $210,000. [00:11:22] We've also budgeted $15,000 for art [00:11:26] to be displayed throughout the city as those projects come up. [00:11:35] Transfers to the department or from the department, [00:11:42] transfers to the general fund for administrative services [00:11:44] did increase to $406,910. [00:11:49] Transfers to the general debt service [00:11:51] did increase to $3,550,000. [00:11:56] The debt associated with that is the 2016 refunding, [00:12:00] the 2020 series for the parking garage, [00:12:02] and also the series 2022 for the SunTrust building. [00:12:09] We have the CRA loan paid to the general fund for $619,310. [00:12:16] And the transfer to the general fund for the parking garage [00:12:20] maintenance of $252,950. [00:12:27] And that's just our share? [00:12:30] I'm sorry? [00:12:31] That's our share of the maintenance of the garage? [00:12:33] That's our total costs associated with it, yes. [00:12:37] It doesn't reflect the amount, of course, [00:12:40] that's paid in by the hotel or Kaiser University. [00:12:44] That's on your revenues, of course. [00:12:54] And if you're interested in more detail, [00:12:56] I can provide a breakdown of those expenses. [00:12:59] That's like contractual contributions. [00:13:01] That's the $118,000 on the revenues? [00:13:04] Yes. [00:13:06] Thank you. [00:13:10] So we had the $3.5 million transfer [00:13:13] for general debt services. [00:13:14] What's our balance on that? [00:13:18] There's more than one bond involved in that. [00:13:22] So we would have to report back to you on that number. [00:13:28] You know, I guess maybe what you might be able to tell me [00:13:31] is we can expect that similar amount [00:13:35] to be budgeted for next year. [00:13:38] Depends on whether or not we're able to pay off [00:13:40] any of the bonds. [00:13:41] And we are hopeful that we will at least minimally [00:13:45] be able to pay off the SunTrust bond. [00:13:55] And then just finally, we go back to revenue code. [00:14:02] So we looked at it for 23, 24 years. [00:14:06] We got almost $12 million. [00:14:09] But part of that, of course, obviously [00:14:12] is reoccurring that we can pretty much count on [00:14:17] would be the tax increment, which [00:14:24] is increased to 3.6, and also the TIF to 4.0. [00:14:30] Right? [00:14:31] Around 8, yeah. [00:14:32] So that's just under 8. [00:14:35] But of course, we have these other funds. [00:14:39] And we brought a million we didn't spend to carry over. [00:14:42] But generally speaking, then, without much expectation [00:14:50] of changes, we could see that this $11 million budget, [00:14:55] almost 12 this year, could be closer to 8 next year. [00:15:00] Am I kind of looking at that right? You are reading it accurately, yes, but I [00:15:09] would add additionally that we have projects that may come on the tax rolls [00:15:15] in part before the next budget year and we may also sell the SunTrust property [00:15:28] which would bring in 1.8 million dollars worth of revenue into the CRA before [00:15:37] the onset of the next fiscal year. That would be revenue coming in? Or more, if we sell the River Road property, if we sell, we owe money on the SunTrust [00:15:48] property, right, so we use it? Right, okay. It's just, yeah. We'll have the River Road church property and the cigar warehouse, so we'd be ahead. Okay. And we have a 1.5 million dollar increase in the [00:16:07] CRA TIF revenue this year. We might not expect that huge jump in the property [00:16:14] values, they just stabilize, but just a 3% save our homes is pretty much out [00:16:20] there. So that's the whole investment strategy of a CRA and it's all the city, [00:16:28] all of your city department heads are sitting here and we're in a CRA meeting [00:16:33] and just saying again this is the sacrifice of the general fund to [00:16:38] actually watch our city grow and build and it has to be successful in order for [00:16:43] us to ultimately have that tax base that lasts us into the future. So that's [00:16:49] why I think it's important that we have some good solid consulting, not just me [00:16:53] saying it or us, but to have a strategy that says let's use these big dollars [00:17:01] coming in every year to keep, so we're kind of the developers here, we're not [00:17:05] government on the other side of it, and every one of these successful projects [00:17:12] is bringing in more, you know, financial support to the city and we can [00:17:19] strategize them that way and I think we've done a good job and so thank you [00:17:23] for the, thank you for getting us this far and for working us through this and [00:17:28] it's a very strong budget. I would only ask, because we've been talking about it, [00:17:34] that there's the potential for us to acquire, for example, the Shwetman [00:17:40] building. It's probably embedded in here under acquisitions. If it is or it isn't, [00:17:48] I don't know, but we talked again this today about other acquisitions. You have [00:17:55] money in there for that? We can always amend the budget, but we need to make [00:18:00] sure they're in the plan as well and are we not updating that plan? We are [00:18:04] updating the plan and my expectation is that it will be complete within two [00:18:09] months and I do have money in the budget to cover the down payment for [00:18:17] Shwetman if you determine that that's something that you want to pursue and [00:18:23] that's all that would be required to be paid in accordance with the way the [00:18:30] agreement is that I will present to you at your next meeting. That's exciting. [00:18:36] Thank you. Anything else? Well, it was called a review, so I guess we don't

   This text was generated automatically from the meeting video. It is not a verbatim or official record. For exact wording, consult the video or the city clerk.

4. 4Communications▶ 18:44
5. 5Adjournment▶ 19:55