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HomeMy WebLinkAbout2011/10/04-Minutes-Fort Worth Local Development Corporation (FWLDC)CITY OF FORT WORTH, TEXAS FORT WORTH LOCAL DEVELOPMENT CORPORATION CALLED — SPECIAL SESSION TUESDAY, OCTOBER 4, 2011 Present: President Frank Moss Vice President Danny Scarth Treasurer W.B. "Zim" Zimmerman Director Betsy Price Director Joel Burns Director Kathleen Hicks Absent: Director Salvador Espino Director Jungus Jordan Director Dennis Shingleton City staff: Susan Alanis, Assistant City Manager Peter Vaky, Deputy City Attorney Ron Gonzales, Assistant City Secretary Jay Chapa, Director, Housing & Economic Development Department Cynthia Garcia, Assistant Director, Housing & Economic Development Department Coy Gray, Senior Administrative Services Manager, Housing & Economic Development Dept. Other City staff in attendance included: Fernando Costa, Assistant City Manager Robert Sturns, Economic Development Manager, Housing & Economic Development Dept. Henry Day, Senior Management Analyst, Housing & Economic Development Department Robin Bentley, Community Development Manager, Housing & Economic Development Dept. LeAnn Guzman, Assistant City Attorney Call to Order (Agenda Item 1) With a quorum of the Board Members present, President Moss called the called - special session to order for the Board of Directors of the Fort Worth Local Development Corporation (Corporation) at 1:01 p.m. on Tuesday, October 4, 2011, in the Pre - Council Chamber of the Fort Worth Municipal Building, 1000 Throckmorton Street, Fort Worth, Texas, with Directors Espino, Jordan and Shingleton absent. CITY OF FORT WORTH, TEXAS FORT WORTH LOCAL DEVELOPMENT CORPORATION CALLED — SPECIAL SESSION THURSDAY, OCTOBER 4, 2011 Page 2 Approval of Minutes from Meeting Held on September 8, 2011 (Agenda Item 2) President Moss opened the floor for a motion on the minutes. MOTION: Upon a motion made by Director Burns and seconded by Director Scarth, the Board of Directors of the Fort Worth Local Development Corporation voted unanimously six (6) "ayes" and zero (0) "nays ", with Directors Espino, Jordan and Shingleton absent, to approve the minutes of the September 8, 2011, meeting of the Fort Worth Local Development Corporation. The motion carried. Consideration of Financial Report (Agenda Item 3a) President Moss referenced the following financial report: The Balance Sheet dated August 31, 2011, for the Corporation (unaudited) as follows: Assets Cash and cash equivalents Interest Receivable Accounts Receivable Total Assets Liabilities and Fund Balance Accounts and Contracts Payable Total Liabilities Fund Balance (Deficit) Designated for Authorized Expenditures Net Income Undesignated Total Fund Balance Total Liabilities and Fund Balance $1,917,593.61 7,438.20 00.00 $1,925,031.81 0.00 0.00 $2,492,627.92 (567,596.11) 0.00 1,925,031.81 $1,925,031.81 The Statement of Revenues and Expenditures from October 1, 2010, through August 31, 2011 (unaudited), for the Corporation as follows: CITY OF FORT WORTH, TEXAS FORT WORTH LOCAL DEVELOPMENT CORPORATION CALLED — SPECIAL SESSION THURSDAY, OCTOBER 4, 2011 Page 3 Consideration of Financial Report (cont'd) (Agenda Item 3a) Revenues Property Tax Reimbursement $42,980.58 Revenue from Rents 331,951.29 Gas Lease Bonus 0.00 Gas Lease Royalties 106,737.96 Easement for Pipelines 64,460.81 Interest Income 20,470.89 Gas Well Shut in Payment 5,000.00 Other Revenue 51,198.38 Total Revenue $622,799.91 Expenditures Bank Charges $290.59 Contractual Services 768,479.78 Insurance 49,366.50 Property Management 13,278.10 Property Purchase 0.00 Property Taxes 120,315.39 Repairs 148,380.85 Security System 5,602.17 Storm Water Utility 29,972.86 Transfers to City 26,000.00 Utilities 28,709.78 Total Expenditures $1,190,396.02 Excess (Deficiency) of Revenues Over (Under) Expenditures ($567,596.02) Fort Worth Local Development Corporation dated August 31, 2011, (unaudited) for the Corporation as follows: Total Cash at August 31, 2011 $1,917,593.61 Cash in Property Management Account (34,513.93) Cash available in City account 1,883,079.68 Commitments Evans & Rosedale Enhanced CFA $0.00 Survey Expenses 6,250.00 Lancaster Project - Construction 511,214.29 CITY OF FORT WORTH, TEXAS FORT WORTH LOCAL DEVELOPMENT CORPORATION CALLED — SPECIAL SESSION THURSDAY, OCTOBER 4, 2011 Page 4 Consideration of Financial Report (cont'd) Lancaster Project — Attorney Fees Oliver's Fine Foods - Loan Oliver's Fine Foods — Attorney Fees Reserves Maintenance Reserve Property Tax Reserve Total Commitments & Reserves Unrestricted Cash Available (Agenda Item 3a) 40,000.00 450,000.00 5,000.00 100,000.00 100,000.00 1,212,464.29 $670,615.39 The Schedule of Available Funds noted that on August 21, 2007, $275,000.00 was transferred to the City (M &C C- 22334) with the understanding that it would be paid back when properties along Lancaster are sold. The transfer was made to fund an art sculpture on Lancaster Avenue. On December 18, 2007, $162,000.00 was transferred to the City (M &C C- 22592) with the understanding that it would be paid back when properties along Lancaster are sold. The transfer was made to fund survey services and improvements on Lancaster Avenue. In September 2008, $92,321.91 of the $162,000.00 was returned to the LDC. President Moss opened the floor for discussion and /or comments on these reports. There was no discussion or formal action on the reports and the reports were accepted as presented. Memo Regarding Proposed Changes to Bylaws and Bank Accounts (Agenda Item 3h) President Moss referenced the staff's memorandum regarding the proposals for changes to by Corporation's bylaws and the creation of separate bank accounts for the Corporation. President Moss stated that he had questions regarding the memorandum and asked Mr. Jay Chapa, Director, Housing and Economic Development Department, to provide a briefing to the Corporation on this item. Mr. Chapa stated that staff was considering changes to the bylaws of the Fort Worth Local Development Corporation (LDC) to have them mirror more closely with those of the Fort Worth Housing Finance Corporation (HFC). He advised that in the past the LDC was a property owning entity and now that it was being used more for development and becoming more involved, the staff would like to create the same type of structure as like the HFC. He CITY OF FORT WORTH, TEXAS FORT WORTH LOCAL DEVELOPMENT CORPORATION CALLED — SPECIAL SESSION THURSDAY, OCTOBER 4, 2011 Page 5 Memo Regarding Proposed Changes to Bylaws and Bank Accounts (Agenda Item 3b) added that with the HFC, the City Manager acted in the capacity of General Manager and that there was also an Assistant General Manager. He further added that the restructuring would also assist in defining the roles of staff who worked on particular programs. He pointed out that there was also a need to make sure there was a clear separation between the LDC and the City, and for corporate reasons, the LDC's function was clearly defined. He also added that this would also allow for the staff to determine whether it was necessary to create another bank account to separate the LDC funds from the City funds, as those funds were currently held within the City's finances. President Moss asked if staff would also be looking who the LDC fell under insofar as auditing and other issues. Mr. Chapa responded affirmatively and added that the there was an outside audit performed for the HFC and financial management was held by the City. President Moss opened the floor for discussion and /or comments on this memorandum. There was no further discussion or formal action on the memorandum and it was accepted as presented. Executive Session (Agenda Item 5) President Moss stated that he had been advised that an Executive Session was not necessary on the following items: A. Seek the advice of its attorneys concerning the following items that are exempt from public disclosure under Article X, Section 9, of the Texas State Bar Rules, as authorized by Section 551.071 of the Texas Government Code: (i) legal issues concerning any current agenda item; and B. Discuss the purchase, sale, lease or value of real property, as authorized by Section 551.072 of the Texas Government Code. Deliberation in an open meeting would have a detrimental effect on the position of the Corporation in negotiations with a third party; and C. Discuss or deliberate negotiations related to any economic development negotiations, as authorized by Section 551.087 of the Texas Government Code. This agenda item was passed over. CITY OF FORT WORTH, TEXAS FORT WORTH LOCAL DEVELOPMENT CORPORATION CALLED — SPECIAL SESSION THURSDAY, OCTOBER 4, 2011 Page 6 Adopt Resolution Approving Budget for the 2011- 2012 Fiscal Year (Agenda Item 5) Mr. Coy Gray, Administrative Services Manager, Housing and Economic Development Department, presented the 2011 -2012 Fiscal Year Budget for the Fort Worth Local Development Corporation. Using a PowerPoint presentation, Mr. Gray and outlined the proposed budget as follows: REVENUES Property Tax Reimbursements $ 38,158.45 Revenue from Rents 479,397.89 Gas Lease Royalties 30,000.00 Enhanced CFA from City 830,000.00 Interest Income 12,000.00 Change in Fair Value of Investments 0.00 Other Revenue 0.00 TOTAL REVENUE $1,389,556.34 Mr. Gray advised the Corporation of the following expenditures: EXPENDITURES Bank Charges $ 350.00 Commissions 18,374.00 Contractual Services 622,571.06 Insurance 84,000.00 Property Management 19,175.92 Property Purchase 200,000.00 Property Taxes 122,590.00 Repairs 65,000.00 Security System 5,280.00 Storm Water Utility 32,400.00 Surveys and Appraisals 5,000.00 Transfers to City 26,000.00 Utilities 20,200.00 TOTAL EXPENDITURES $1,220,940.98 EXCESS (DEFICIENCY) OF REVENUES OVER (UNDER) $168,615.36 CITY OF FORT WORTH, TEXAS FORT WORTH LOCAL DEVELOPMENT CORPORATION CALLED — SPECIAL SESSION THURSDAY, OCTOBER 4, 2011 Page 7 Adopt Resolution Approving Budget for the 2011- 2012 Fiscal Year (cont'd) (Agenda Item 5) Mr. Gray pointed out that staff received information yesterday pertaining to the Repairs line item. He advised that in the packet previously received by Corporation members, the line item reflected $40,000.00; however, $25,000.00 had to be added to the line item because of some environmental disposal issues at the Blue Mound facility associated with some chemicals left by America Iron Horse Motorcycle Company, Inc. when they vacated the property. He stated that staff recommended the Corporation amend the budget to reflect the change to the Repairs line item of $65,000.00 and the overall Total Expenditures of $1,220,940.98 President Moss opened for the floor for discussion on this issue. President Moss referred to the revenues portion of the budget and inquired if the amount reflected in the Enhanced CFA from City line item was income. Mr. Gray stated that the income was from the Evans and Rosedale project where the funds were expended from the LDC and were now coming back to the LDC as revenue. There being no further discussion, President Moss opened the floor for a motion. MOTION: Upon a motion made by Director Zimmerman and seconded by Director Scarth, the Board of Directors of the Fort Worth Local Development Corporation voted unanimously six (6) "ayes" and zero (0) "nays ", with Directors Espino, Jordan and Shingleton absent, to approve and adopt Resolution No. FWLDC - 2011 -16 as amended. The motion carried. Adopt Resolution Authorizing the Purchase of Property Located Within the Boundaries of Lancaster, Jennings, 13th Street and Throckmorton Street for the Proposed Mixed Use Development on West Lancaster Avenue (Agenda Item 6) Mr. Jay Chapa, Director, Housing and Economic Development Department, addressed the Corporation regarding the proposed resolution. Using a PowerPoint Presentation, Mr. Chapa began by displaying an aerial view of the property under consideration and noted that the property in green was for residential use, in blue for office use and in gray for the parking garage. His next slide contained information pertaining to the project overview, current status and next steps for the development as follows: CITY OF FORT WORTH, TEXAS FORT WORTH LOCAL DEVELOPMENT CORPORATION CALLED — SPECIAL SESSION THURSDAY, OCTOBER 4, 2011 Page 8 Adopt Resolution Authorizing the Purchase of Property Located Within the Boundaries of Lancaster, Jennings, 13th Street and Throckmorton Street for the Proposed Mixed Use Development on West Lancaster Avenue (cont'd) (Agenda Item 6) Project Overview: • Total Project Cost: $25 -$35 Million • Includes development of: • Two residential complexes, both with retail on the ground floor, with at least 100 apartments. • Office complex with retail on ground floor. • Parking garage to service all three buildings. Current Status: • LDC has hired development consultant. Market studies, preliminary building designs, surveys, title work, etc., are underway. • City of Fort Worth has awarded $2,000,000.00 to the project for the Development of Affordable Housing. • Next Steps: o LDC needs to acquire property for development. Mr. Chapa transitioned to the next slide entitled Ownership of Area Properties and advised that the LDC would need to acquire the two (2) properties outlined in red from the City of Fort Worth and also acquire the property outlined in green from the Catholic Diocese who were partners in his program. He pointed out that the diocese would either sell the property as part of the negotiation or would provide the property in exchange for parking spaces in the proposed parking garage. He advised that the properties outlined in yellow (TCCC) and in blue (Meekins Family) were potentially available and staff needed approval from the Corporation to make an offer and provide earnest money to secure options if an agreement was reached. Mr. Chapa advised of the June 2011 original proposal by the Corporation to purchase the City's property as follows: Long term Lease /Option to Purchase City -owned property along Lancaster. o Rent and Option Fee (approximately $40,000.00). ■ Amount for closing costs associated with purchase of the property from the state (Texas Department of Transportation). At time of sale, City receives appraised value of the land, LDC receives value of improvements. CITY OF FORT WORTH, TEXAS FORT WORTH LOCAL DEVELOPMENT CORPORATION CALLED — SPECIAL SESSION THURSDAY, OCTOBER 4, 2011 Page 9 Adopt Resolution Authorizing the Purchase of Property Located Within the Boundaries of Lancaster, Jennings, 13th Street and Throckmorton Street for the Proposed Mixed Use Development on West Lancaster Avenue (cont'd) (Agenda Item 6) • Parking on the Zipper Building to be replaced in parking garage; one off - street parking space is required for the MCI lease will remain. Mr. Chapa then presented the following information regarding the new proposal recommended by staff: • In order to simplify the financing of the project, staff recommends sale of the property instead of long term lease /option. • Purchase price — Approximately $483,752.00. • City currently owes LDC $344,678.09 for LDC - funded improvements along the Lancaster Corridor. Recommendation is for LDC to forgive City's current debt as part of purchase price, the LDC pays balance in cash. • At time of sale, City receives appraised value of the land; LDC receives value of improvements per agreement. • Parking on the Zipper Building lot to be replaced in parking garage; one off - street parking space is required for the MCI lease will remain. Mr. Chapa concluded his presentation by advising of the following staff recommendation: • Authorize purchase of the property owned by the City of Fort Worth for the terms outlined. • Authorize expenditure of up to $25,000.00 as earnest money for each tract needed for the project. The project boundary is 13th Street to the North, Lancaster Avenue to the South, Throckmorton Street to the East and Monroe Street to the West. • Purchase price of each parcel to be negotiated and brought to LDC for approval. Mr. Chapa advised the Corporation of one amendment to the resolution as follows: Under the second Further Resolved paragraph regarding the sale of the property, the third to the last line, reflected that the City would only get the increased value of the land when the project was sold in the future; however, it should reflect that the City of Fort Worth shall be paid any amount attributable to the full value of the land at the time of purchase. CITY OF FORT WORTH, TEXAS FORT WORTH LOCAL DEVELOPMENT CORPORATION CALLED — SPECIAL SESSION THURSDAY, OCTOBER 4, 2011 Page 10 Adopt Resolution Authorizing the Purchase of Property Located Within the Boundaries of Lancaster, Jennings, 13th Street and Throckmorton Street for the Proposed Mixed Use Development on West Lancaster Avenue (cont'd) (Agenda Item 6) President Moss opened for the floor for discussion on this issue. There being no further discussion, President Moss opened the floor for a motion. MOTION: Upon a motion made by Director Scarth and seconded by Director Burns, the Board of Directors of the Fort Worth Local Development Corporation voted unanimously six (6) "ayes" and zero (0) "nays ", with Directors Espino, Jordan and Shingleton absent, to approve and adopt Resolution No. FWLDC - 2011 -17 as amended. The motion carried. Adopt Resolution Authorizing a Broker's Fee Agreement for the Property Located at 4600 Blue Mound Road (Agenda Item 7) Ms. Cynthia Garcia, Assistant Director, Housing and Economic Development Department, addressed the Corporation regarding the proposed resolution. Ms. Garcia advised that on September 8, 2011, the Corporation approved a lease with Lasko Products, Inc., to occupy the property at 4600 Blue Mound Road; however, the broker's fee agreement was not presented at that time as it had not been fully negotiated. She began her PowerPoint Presentation entitled, Broker's Agreement for Lease Agreement with Transwestem Commercial Service Fort Worth for Property Located at 4600 Blue Mound Road, by displaying an aerial view of the location. She explained that the property outlined in yellow was the location of the property at Meacham Boulevard and Blue Mound Road. She then displayed a closer aerial view of the property and advised that the area outlined in red was the area actually being leased. She provided the terms of the broker's agreement as follows: • Broker's Fee — 4 -5 percent of the rent. o Includes any expansion area. • Instead of earning the entire commission at execution of the lease, LDC will pay 20 percent each year of the lease on October 1St in case the lease terminates early • October 2011 - $16,608.21. • October 2012 - $17,462.35. CITY OF FORT WORTH, TEXAS FORT WORTH LOCAL DEVELOPMENT CORPORATION CALLED — SPECIAL SESSION THURSDAY, OCTOBER 4, 2011 Page 11 Adopt Resolution Authorizing a Broker's Fee Agreement for the Property Located at 4600 Blue Mound Road (cont'd) (Agenda Item 7) • October 2013 - $18,316.49. • October 2014 - $19,265.53. • October 2015 - $20,214.57 Ms. Garcia advised that staff's recommendation was that the Corporation authorize execution of the Broker's Fee Agreement with Transwestern Commercial Services Fort Worth, LLC. President Moss opened for the floor for discussion on this issue. There being no discussion, President Moss opened the floor for a motion. MOTION: Upon a motion made by Director Zimmerman and seconded by Director Price, the Board of Directors of the Fort Worth Local Development Corporation voted unanimously six (6) "ayes" and zero (0) "nays ", with Directors Espino, Jordan and Shingleton absent, to approve and adopt Resolution No. FWLDC - 2011 -18. The motion carried. Requests for Future Agenda Items (Agenda Item 8) President Moss opened the floor on requests for future agenda items. No requests were made by Corporation Board members. Adiourn (Agenda Item 9) With no further business before the Board, President Moss adjourned the called — special session of the Fort Worth Local Development Corporation at 1:13 p.m. on Tuesday, October 4, 2011. These minutes approved by the Fort Worth Local Development Corporation on the _1st day of November , 2011. CITY OF FORT WORTH, TEXAS FORT WORTH LOCAL DEVELOPMENT CORPORATION CALLED — SPECIAL SESSION THURSDAY, OCTOBER 4, 2011 Page 12 APPROVED: Frank Moss President ATTEST: Dennis Shingleton Secretary Prepared and respectfully submitted by: Ronald P. Gonzales, Assistant City Secre