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HomeMy WebLinkAboutMN-CC-1980-05-12,{ r o COMMON COUNCIL PROCEEDINGS CITY OF ITHACA, NEW YORK Special Meeting 7:30 P.M. May 12, 1980 PRESENT: Mayor - Bordoni Aldermen (8) - Boronkay, Dennis, Gutenberger, Holman, Nichols, Saccucci, Schuler, Slattery ABSENT: Aldermen (2) - Banfield, Boothroyd OTHERS PRESENT: Ithaca Urban Renewal Agency members - Bordoni, Dennis, Stein, Jones, Reed Assistant City Controller - Spano City Attorney - Shapiro Planning & Development Director - Van Cort Acting Fire Chief - Tuckerman Developers - Goldberg and McRobb Architect - Leathers Project Architect - Seligman Planning Staff member - Bottge City Clerk - Rundle PLEDGE OF ALLEGIANCE: Mayor Bordoni led all resent in the Pledge of Allegiance P g to the � American flag. SPECIAL ORDER OF BUSINESS: Ithaca Center Project ga-yorBorcioni stated that the Special meeting that evening was for a discussion only on the final design alternatives and finances for the Ithaca Center project. No decisions were to be made; there would be (600e time for questions, and developers, architects, city planners, as well as the city attorney, were present for the discussion. The Mayor turned the meeting over to Planning Director Van Cort. Mr. Van Cort commented that his department had been working very hard with the developers with the help of practically everybody in City Hall, but particularly with the Mayor and City Attorney Shapiro who have been meeting almost daily with Planning on this project. He mentioned that the Memorandum which was before the Council was the third or fourth draft of the Understanding on the Ithaca Center project. However, some items are still under negotiation; there is nothing final at this point. Mr. Van Cort mentioned that there will be a Public Hearing on the UDAG Grant on Tuesday, May 13, 1980, and another Special meeting of Common Council and IURA /CDA on Wednesday, May 14, 1980. Mr. Van Cort also corrected a prior statement that he had made with reference to a DEIS meeting being held on Thursday, May 15, 1980. That Public Hearing on DEIS will be held on Friday, May 16, 1980 at 4:00 P.M., at Central Fire Station. Mr. Van Cort stated that he hoped to have the designs from Architect Seligman's office to distribute to council members and IURA members on Friday, May 23rd. On Wednesday, May 28th, he hopes that action will be taken by the Agency and the Council. Alderman Holman requested that Mr. Van Cort state what action will be taken on Wednesday, May 14th. Mr. Van Cort said the actions to be taken are: Coe, 1. the actual formal resolution authorizing the Mayor to submit the UDAG application which the Council has not yet actually done. 2. approval of the terms of the UDAG payback and the UDAG reuse. 3. the land purchase agreement and the payback associated with that. Mr. Van Cort commented that he hopes to take all the necessary informa- tion to Washington on Thursday, May 15th, to discuss it with American City and, subsequently, to MUD and Farmers Home Administration on Friday, May 16th. That is why action must be taken on the 28th. The design will he given to COUnCil before it is asked to consider giving Goldberg /McRobb preferred developer status. �) 11 -2- May 12, 1980 Mr. Van Cort stated that at that evening's meeting there would be two design presentations - -one by Bob Leathers who the City has retained to prepare designs for the area between City Hall and the parking ramp, as well as the strip of land which runs between the parking ramp and the buildings on the Commons; that is, the Home Dairy and CVS, that entire strip of land which is owned by the City but is a jointly held right -of -way to which all the abutting owners have an easement or right -of -way. The City has asked Bob Leathers to prepare some designs with the expectation that they would make improvements to that propert with the proceeds from the UDAG Grant. Continuing with the agenda, Mr. Van Cort added that Werner Seligman would give an update on the progress that has been made in the design of the Ithaca Center. After that there would be an update on the financial aspects of the project, including the first mortgage loan and the application that is being made by Citizens Savings Bank for a Farmers Home loan guaranty. Then we will go to the UDAG application and the payback schedule, for UDAG will be used both for public improvements and for second mortgage loan. Finally, Director Van Cort would like to go over the Memorandum of Understanding which contains many of the terms stated above; it is more of a compilation of the things on which we have agreed or are working toward agreement with the developer. There was discussion on the Environmental Impact Study with reference to the Ithaca Center project. Planning Director Van Cort mentioned that all the requirements that are necessary would be undertaken, but since there is a minimum waiting period between each process with reference to the Environmental Review Process, he felt that other steps could be started. Mr. Van Cort also mentioned that in order for the Center to move ahead it requires action by both the Urban Renewal Agency and the Common Council, as partners. Mr. Robert Leathers, architect, was the next speaker. He is designing public improvements, the construction for which it is hoped the City will be able to use UDAG proceeds. Mr. Leathers pointed out on his design the area that will be affected for public improvements. He talked about a strip of land that is about 13-feet between the back of the stores and the columns of the parking garage. Also, there is an additional 8- or 9 -foot strip along the service area. The area is generally "L" shaped. Mr. Leathers mentioned two areas: one for service access to the back of buildings along the mentioned strip, and the other for pedestrian use. There will be parking spaces, and traffic will be coming into and exiting much the same as now. The removal of refuse is necessary and can only be handled one way - -by dumpsters. The design shows specific places to put refuse. At present, pedestrians filter through the whole area. Mr. Leathers' design calls for a specific area to be used by pedestrians. It also calls for the removal of all materials above ground, stripping everything from building to building, and putting in completely new pavement and landscape. Asphalt will be retained where there is vehicular traffic, same as now. There will be a series of walls that will vary in height from S to 8 feet at the most. These will be to screen dumpsters and trash cans. Mr. Leathers explained that the pedestrian area comes through along the back side of the buildings. The design shows this area as being brick pavement, although later he explained that it does not necessarily have to be brick. There will also be concrete pavement in some places. Trees will be added and some shrubs will be planted along the buildings. It is legally necessary to retain access through the entire area by vehicles. There will be nothing built in the area where merchants have a joint right of access. The present entrance will be retained and there will be one small table with benches in a waiting area. The pedestrian zone will be well lighted. Upon questioning, Mr. Leathers said that there would be room for a truck turn - around. Also, there is space underneath the ramp which is reserved -3- May 12, 1980 .; 1 as a loading zone, that zone being about 32 feet. There was also dis- cussion about how the area ties in with the alley and Home Dairy and what will happen to the Farmers Market. Some of that design will be done by the developer. Discussion continued on getting into and out of the parking spaces that will be available in the reconstructed area. Planning Director Van Cort (400esaid that the design as it is now is the best possible way under present , plans. There were concerns expressed about exiting onto Green Street as there are already problems in the area between City Hall and the parking ramp. The Fire Department will have some input into the project to make sure that there will be available space for fighting fires. The design also includes curb cuts for the handicapped as well as a space to be used in the future for access to City Hall for the handicapped. Project architect Werner Seligman said that designing a project such as Ithaca Center is a slow and tedious matter. He has been working on it for a very long time as much information has to be keyed into the design, such information coming from many different people such as engineers, mechanical engineers and others in order to have a better understanding of what is to go into the design. It is very difficult for the layman ,l to see all the obstacles that must be considered and dealt with before the design actually takes shape on the drawing board. With the help of 1_ slides Mr. Seligman showed what the building would consist of as far as the number of floors, where access to the building would be, where the court yard would be, what would be inside the building, the back of the building, etc. Mr. Seligman talked mostly about the facade of the project,; its rhythm and continuity with the Rothschild building and the bank building across the street. Mr. Seligman showed slides of similar buildings already constructed in other cities and in foreign countries so that those people present could get a better idea of what the finished project would look like. He dis- cussed in detail the kind of walls that would be used in the design that would fit in with the Rothschild wall, as well as the wall of the First National Bank. Discussion followed with members of the Council and the IURA stating their ideas regarding the use of a brick facade inasmuch as most of the buildings on that particular side of the street do have a brick facade. However, it is understood that brick has not been actually decided on. Some concern was shown about the project looking like a square concrete box. Mr. Seligman explained that there were several cut -outs, as well as extension of the curtain wall, so that the building would not look like a big square. Also, the drawings are in the early stage and he expects that the design will be changed several times before the final stages. Progress Report - Finance Planning Director Van Cort reported that the developer is working with Citizens Saving Bank and that the Citizens Savings Bank has agreed to a first mortgage loan to the developer- for the entire amount of the project without participation by any other financial institutions, contingent upon two things: I. Commitment of UDAG 2. Ninety percent guarantee by Farmers Home Administration Mr. Van Cort explained that this same kind of financing was used for the Gun Company project. UDAG understands that this is the way the are trying to go. If it is appropriate to combine the two programs, then we will submit the UDAG application in order to perfect the mortgage loan. Developer Scott McRobb stated that the total cost of the project is $7.6 million dollars. Mr. Van Cort was asked holy long it would be before word would be forth- coming from UDAG, lie stated that the complete application has to be submitted to UDAG by Friday, May 30th. The application must be complete 38 7 -4- May 12, 1980 in every respect and the financial condition has to be that the City has a letter from Citizens Bank saying that they will make a loan, contingent upon a 90o guaranty from FHA. Mr. Van Cort did state that HUD will give the City a certain amount of time to put one piece in place if everything else is alright. HUD will give us 10 -20 days in which to see whether FHA will make the guaranty. Mr. Van Cort mentioned that Mr. Gesslein of the Citizens Savings Bank has done a tremendous amount of work in the last week to try to put this project together. Mr. Gesslein has already had conversations with FHA in Syracuse, and FHA has indicated that the chances are very good, and has further indi- cated that it is possible and likely that all the paper work can be done and the application can be processed through the regional central office and approved in time to make the UDAG cycle, which is the first or second week of June. Mr. Van Cort also stated that he has found it a pleasure to do business with FHA. He worked with them on the Cherry Street project and found that organization would do everything that it said it would do and he personally feels very optimistic about the Ithaca Center project. On questioning, Planning Director Van Cort stated that the $7.6 million for the Ithaca Center project from first UDAGt gage loan from Citizens Savings and the developer's equity; Discussion followed on at would ch ppen if the developer's equity In the project, due to is less than the $6.5 million now anticipated. Mr. Van Cort stated that there is nothing in the Memorandum of Understanding which protects the City against that possibility. He said he would talk to Mr. Goldberg and Mr. McRobb about putting some language into the agreement that would guarantee that we would get more back for UDAG. City Attorney Shapiro felt that the City has some protection because the architect's drawings and any changes or alterations in the design that would make a difference in the cost of the project would have to be approved by Common Council. Planning Director Van Cort mentioned that if the papers are not submitt to HUD by May 30th, the developer probably but would wait until 1981. Alderman Holman asked how flexible HUD would be as far as any changes that might be made after May 30th. Mr. Van Cort understands that HUD is very interested in the fact that American Cities Corp. is doing a marketing analysis on the project; HUD believes that makes it a far more solid and doable project. Mr. Van Cort said that while he is in Washington he will ask HUD if the American Cities Corp. presents numbers that are really quite different from the numbers of the performer with respect to rent. If so, can the City then amend its UDAG submission to them sometime in June? Also, you submit the project all wrapped up in a neat little bundle and possibly the only thing HUD will do later is change one single thing. Mr. Van Cort was asked what the $500,000 will pay for as far as improve- ments to the city. He said that $200,000 will be spent for the space out away from the buildings, including the underground improvements and the space next to the buildings. Another $245,000 or so will be for the roof over the courtyard and then another $75,000 will go for the elevator. The rest of the on -site improvements and the improvements to join the sides are going to have to be built by the developer at their expense. Alderman Saccucci asked why the developer would wait seven years after the opening of the project to develop the area under the Green Street ramp. Planning Director Van Cort explained that the developer and the:, Bank involved felt that previous projects have failed in part because of an overly - ambitious emphasis on retail and that the real problem with the other projects wasthat they tried to rent somewhere in the neighbor- hood of 100,000 feet of retail space in a downtoi•:n location without a spread of uses to back them up. The present developer is trying to strengthen the project with housing and a small amount of retail space in the first stage in order to test the market. There is nothing sacred about the seven years. If American Cities comes back in June and say that there is a strong market demand for immediate construction of more retail space, then the developer will go forward. Mrs. Jones, IURA member, asked Planning Director Van Cort what improve- ments the developer would pay for that is not included in the $500,000 3 1 -5- May 12, 1980 UDAG. Mr. Van Cort mentioned all the pavement underneath the parking garage, any other improvements necessary to control parking, sidewalk on Green Street, the paving between the parking garage and the project, any new paving in the Home Dairy alley, any cover that they might want to build, either between the garage and the project or between their project and the Home Dairy, and public toilets. Discussion continued on the sale price of the land and how it was (400.arrived at. Planning Director Van Cort stated that he has always used " the figure $400,000 although he does not know if that is a true value figure. The front piece is valued at $250,000 and the back piece is valued at $150,000. The purchase price of the land. is to be paid over a period of ten years at 6% interest. "Title will be transferred on closing and the land is not part of the developer's equity in the $7.6 million project. Mr. Van Cort explained the City's position in case of a foreclosure against the developer. The Tax Collector would be'first in line, the Citizens Savings Bank next, and then the City of Ithaca. A ten - minute recess was called at this point (.10:00 p.m. to 10:10 p.m.). UDAG Repayment Schedule and Use Planning Director Van Cort explained that the UDAG Grant is made by the 3 Federal Government to a municipality. The municipality then can do with it as it likes and as agreed to with HUD. The repayment by the developer t will go to the City and that money is kept by the City as it comes in. The City can lend it out or put it into another project. Mr. Van Cort is recommending that the proceeds of the loan (repayment) should be split between the Ithaca Neighborhood Housing Services and Industrial Economic Development that is yet to be designed. Mr. Van Cort explained that the first year the developer will make no payment; for the next two years interest only will be paid; from the fourth year on both principal and interest will be paid. IIe explained the percentages of ILpayback that will go to Ithaca Neighborhood Housing and Industrial Economic Development. Mr. Van Cort referred to a list of eligible uses that can be made of UDAG repayment money, a copy of which had been given to those persons attending the meeting. Memorandum of Understanding Planning Director Van Cort went through the Memorandum of Understanding proposal between the City of Ithaca and Goldberg /McRobb, the developer. Paragraph 1 has to do with IURA's proposal to HUD for a $1.7 million UDAG. If the grant is awarded to the City, Mr. Van Cort explained how much would be loaned to the developer and the payback schedule by the developer. Mr. Van Cort mentioned that the figures may change, depending on the developer's cash flow after the first three years. Paragraph 2 was discussed earlier in the meeting, and a change in the language was recommended for the last sentence which will now read: "It is understood that the City's first responsibility is to public improvements outside of the project and, to the extent that the $500,000 is not sufficient to cover other such improvements the developer will be required to assume these costs." Paragraph 3 is concerned with architects using the established public improvement design for the area under the Green Street Parking Garage. Paragraph 4 discusses reference to the selling price of the land we acquisition by the developer. City Attorney Shapiro stated that he felt the figure to be a fair one and that it was the figure used in the last three Ithaca Center proposals. Mr. Van Cort again mentioned the period over which the developer would pay for the land and the amount of interest. Paragraph S covers the developer's agreement to construct an improved parking area underneath the parking garage. At the present time terms are very vague and at the time of closing the sale of the land an agreement will also be executed covering the terms on which the parking area will be operated. There will also be a clause stating that changes may be negotiated after the first year of operation if circumstances warrant. 6_ May 12, 1980 Paragraph 6 briefly spells out what will happen if the leasable space in the Ithaca Center project reaches a 90a occupancy, or if it doesn't, after certain periods of time. It also states that there will be a contract covering compliance with paragraph 6, such contract to have the approval of IURA and Common Council. Paragraph 7 states that if IURA and Common Council decide on the 28th day of May 1980 to grant final preferred sponsorship to Goldberg /McRobb such action will still be contingent upon performance of certain other things and the occurrence of certain other things that are briefly des cribed. In Paragraph 8 Alderman Nichols noted a few minor changes. The changes were not of substance, but rather in the separation of certain sentences into separately lettered paragraphs. Paragraph 8 covers the City's right of access to the public open space in the Center Ithaca project and spells out certain things that the developer will do at their own expense. Dis- cussion was held on the subparagraph covering charge or fee for usage of the public open space. Such things will be covered in a contract to be negotiated. ADJOURNMENT: On a motion, the meeting was adjourned at 11:04 p.m. Jos ph A. Run le, City Cler Rdymond Bordoni , Mayor