HomeMy WebLinkAboutMN-IURAED-2021-08-18Approved: 10/12/21
108 E. Green St. Ithaca, NY 14850
(607) 274-6565 MEETING MINUTES
ITHACA URBAN RENEWAL AGENCY
ECONOMIC DEVELOPMENT COMMITTEE (EDC)
3:30 P.M., Wednesday, August 18, 2021
Common Council Chambers, 108 E. Green St., City Hall
Present: Chris Proulx, Chair; Doug Dylla, Vice-Chair; Charlotte Hamilton; Leslie Ackerman
Excused: None
Vacancies: 2
Staff: Nels Bohn; Charles Pyott
Presenters: Finger Lakes Development
Steve Flash, Finger Lakes Development of Ithaca, LLC
I. Call to Order
Chair Proulx called the meeting to order at 3:30 P.M.
II. Agenda Additions/Deletions
None.
Proulx noted Ackerman would be recusing herself during the Committee’s review of the Inlet Island Urban
Renewal Project’s Exclusive Negotiation Agreement, since her employer, Ithaca Neighborhood Housing
Services (INHS), is involved with the project.
III. Public Comments (3-minute max. per person)
None.
IV. Review of Meeting Minutes: June 8, 2021
Dylla moved, seconded by Hamilton, to approve the minutes, with no modifications.
Carried Unanimously:4-0
IURA EDC Meeting Minutes
August 18, 2021
Page 2 of 10
V. New Business
A. Community Lending — Request from 209 W. State Street Associates, LLC for IURA Consent to
Subordinate IURA Mortgage Lien on 209 W. State St. to Facilitate Refinancing (PB-LF #2 State Theatre of
Ithaca, Inc.)
Bohn explained the proposed resolution is associated with the IURA’s 2009 loan to The State Theatre of
Ithaca, Inc. (STI). At that time, the IURA had collateral for both the theatre building itself and a second
mortgage lien on the property located at 209-217 W. State Street, owned by Mack Travis (the President of
the theatre’s Board at the time). 209 State Street Associates, LLC is now seeking to refinance its first
mortgage loan on 209-217 W. State Street and requests the IURA’s consent to subordinate the IURA’s own
mortgage lien to the new loan. The theatre has been making regular loan payments over the past 10
years, with a remaining balance of $326,576.52. Over that time, the theatre has demonstrated its financial
stability, while also making various improvements to the building, currently assessed at $1,850,000. The
IURA would remain in a fairly secure collateral position. Bohn recommended approving the resolution.
Ackerman moved, seconded by Dylla:
Consent to Subordinate IURA 2nd Mortgage on Property Located a
209-217 W. M.L.K., Jr./State Street (PB-LF #2, State Theatre)
WHEREAS, on January 22, 2009, the Ithaca Urban Renewal Agency (IURA) approved a loan of $458,500
to State Theatre of Ithaca, Inc. (STI) to acquire and operate the State Theatre, and
WHEREAS, the IURA loan is secured by the following collateral:
• 1st mortgage lien on the State Theatre building property located at 117 W. State Street.
• 2nd mortgage lien on property located at 209-17 W. State Street.
WHEREAS, 209 State Street Associates, LLC seeks to refinance the first mortgage loan on 209-17 W.
State Street, and requests the IURA consent to subordinate its mortgage lien to the new loan not to
exceed the lesser of $675,000 or 75% of appraised value, and
WHEREAS, as of June 30, 2021, the outstanding principal balance of the STI loan is $326,576.52, and
WHEREAS, the assessed value of the State Theatre property at 117 W. State Street is $1,850,000, and
WHEREAS, the appraised value of the property located at 209-217 W. State St. is estimated to exceed
$900,000, and
WHEREAS, the estimated collateral value of the mortgages securing the IURA loan after proposed
refinancing is substantially more than the outstanding loan balance, and
IURA EDC Meeting Minutes
August 18, 2021
Page 3 of 10
WHEREAS, at its August 18, 2021 meeting, the Economic Development Committee reviewed this matter
and recommended the following; now, therefore, be it
RESOLVED, that the IURA hereby consents to subordinate its existing subordinate mortgage on the 209-
217 W. State Street property (also known as the Family Medicine Associates building) to new financing
from the existing first mortgage lender Tompkins Trust Company in an amount not to exceed $675,000,
and be it further
RESOLVED, that IURA Chairperson, upon the advice of IURA legal counsel, is hereby authorized to
execute all necessary and appropriate documents to implement this resolution, including, but not
limited to, executing an intercreditor agreement.
Carried Unanimously: 4-0
B. Tompkins County Economic Recovery Strategy — Discussion
Bohn reviewed the Tompkins County Economic Recovery Strategy planning document, which was
developed both as an immediate response to the COVID-19 pandemic and to serve as a roadmap to guide
long-term planning and recovery. Stakeholder input came from discussions with the Economic Recovery
Cabinet, Economic Development Resource Providers Group, Economic Development Collaborative, Ithaca
Area Economic Development, and the Tompkins County Housing and Economic Development Committee.
The City’s Deputy Director for Economic Development Tom Knipe worked actively on the project. Bohn
wanted to make sure the Committee is aware of the initiative, as it moves forward. Some proposed
projects may come before the IURA for funding over the next few years. No action is required by the
Committee today. Common Council will be considering funding requests associated with the initiative
(listed on the following page) as part of its annual budget deliberations and submit its recommendations to
the Mayor.
(continued on next page)
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August 18, 2021
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Dylla asked if the “Route 13/5th Street Infrastructure” project would be focused only on Fifth Street. Bohn
replied, no. When the large recent waterfront projects were being developed (i.e., Guthrie Medical
Group/City Harbor, Cayuga Medical Center), the Department of Transportation (DOT) said that Route 13 is
not performing at a normal standard and would require mitigation measures, like complete sidewalk
access or a 3-way intersection with pedestrian improvements. Any proposed improvements would be
connected to the whole corridor and would need to satisfy DOT. The City has also been pursuing a BUILD
grant to redesign the whole corridor.
Hamilton recommended the Economic Recovery Strategy focus more on technological commercialization
with local universities to leverage what the local technology-based community is best at doing: incubating
and starting new businesses. Ithaca has some of the largest research institutions and budgets in the world,
but there is not enough support for creating local companies based on those technologies.
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August 18, 2021
Page 5 of 10
Ackerman suggested focusing on training people in construction-related trades and connecting small
contractors with larger construction projects. The construction industry has become increasingly
desperate to find skilled employees. There should be more opportunities for robust partnerships with the
construction industry to create skilled jobs in the community (which would also be exportable, since there
are plenty of other regions facing the same problem).
Proulx noted there are a few items he does not understand about the slides. Some projects on some of
the slides do not appear on the funding request chart (e.g., conference center). Similarly, there are
discrepancies between some of the totals on the chart and the totals on the slides. He wondered if it
would not be better to invest larger amounts in more impactful projects, rather than distribute the funds
to a variety of smaller projects. For example, he is not sure how much sense it makes to spend $600,000
on the “Micro-Mobility – Bikeshare” project, but only $250,000 on the “Workforce Re-Entry Program.”
Hamilton agreed with Proulx regarding the proposed funding level for the bikeshare project. Nor is she
convinced of the value of the “Office Recruitment Program” and “Cluster Tech Business Center Growth &
Attraction” program. She would also like to see more of a focus on equity (especially in sectors that
perform poorly in terms of diversity and inclusion, like construction and technology), including expanding
economic development opportunities to smaller and under-served businesses. Ackerman agreed.
Proulx observed there is also no mention on the chart of local labor representation.
Dylla agreed with Proulx’s suggestion to invest larger amounts in more impactful projects.
C. Ithaca Farmers Market (IFM) Improvements — Update
Bohn noted that no action on this agenda item is required by the Committee, but it will eventually require
action by the IURA Board, since the City leases the IFM site to the IURA, which then sub-leases it to IFM.
Any physical changes to the site will require IURA Board approval. IFM is proposing to create a four-
season portion of building and will make a presentation to Common Council in September 2021. Bohn will
meet with IFM leadership to gather more information on the project and ensure Common Council is
amenable to the project, before any IURA action. The project remains very early in its development
process; and many issues remain unresolved.
(continued on next page)
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August 18, 2021
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Dylla remarked he has observed significant parking and traffic issues at IFM, since COVID-19. He likes the
proposed improvements conceptually, but in the short-term IFM should address the parking/traffic
situation, which is especially serious, even treacherous, on weekends. IFM should have parking monitors
to control parking and traffic. He suggested IFM negotiate a lease with the Department of Transportation
(DOT) to open up additional parking, even charging a modest fee for parking and operating a shuttle
service from the DOT site.
Ackerman noted that encouraging people not to drive as much as possible, would be really great,
especially in combination with other mitigation measures. IFM leadership has also done a good job of
reaching out to various people in the community who have connections in the food, farming,
infrastructure, and transportation sectors.
Proulx added that IFM could also improve its trash management operations, during high-volume times.
(Ackerman departed at 4:05 p.m.)
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August 18, 2021
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D. Inlet Island Urban Renewal Project, Exclusive Negotiation Agreement (ENA) — Review
Bohn reported the IURA Board resolution was brought before Common Council, which discussed it in some
detail. Several Common Council members wanted to ensure Inlet Island would be attractive to local
residents, so the following condition was added to the resolution:
“Commitment from Developer to include active ground floor uses without reducing affordable housing.”
Bohn explained the purpose of today’s meeting is for the Committee to agree on a final draft Exclusive
Negotiation Agreement (ENA) to recommend to the IURA Board, conditioned on Common Council’s
eventual approval of the Disposition and Development Agreement (DDA). Bohn drafted the initial version
of the ENA, which Flash subsequently inserted suggested changes into.
Proulx observed Flash’s suggested changes on page 1 of the ENA appear to be simple clarifications. The
suggested changes on page 2, under “C. Period of Negotiations,” are more substantive.
Proulx asked if Flash is saying he would like to start the clock only after all the appraisals have been
received from the IURA.
Flash replied, yes. The actual negotiation process should not commence before the appraisals have been
received. Finger Lakes Development (FLD) will need to refine its proposal, before the appraiser knows
what to appraise. The land values, for example, would be different for parking uses vs. buildings. It will
take several months to get the appraisal process started, since FLD wants enough time to refine its
proposal. FLD also wants clarification from Common Council about the issue of ground-floor activation,
since that conflicts with parts of the original proposal.
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August 18, 2021
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Bohn remarked that the appraisals will identify the Fair Market Value (FMV) of each parcel, which would
then be discounted according to environmental remediation and other costs. The IURA will engage the
appraiser, once the ENA is fully executed. Adjustments can then be made to the appraised values, based
on the costs of any amenities, which would be part of the negotiation process.
Flash expressed concern the appraisals would calculate the FMVs only according to the highest and best
use of each parcel, since that would conflict with the project as currently proposed.
Proulx noted the quicker the IURA can identify starting property values, the better. The parties can always
negotiate any changes to those values to develop a financially feasible project.
Flash discussed step 2, regarding Department of Environmental Conservation (DEC) confirmation of its
willingness to convey DEC-owned Tax Parcel #43.-1-5 (508 Taughannock Blvd.) to the City. Since that
parcel contains the Coast Guard Auxiliary and is owned by the State, it would first have to be purchased by
the City; and presumably the City would not want to pay the full value, if there is any environmental
contamination. The City should work with FLD to obtain a formal determination from DEC that there is no
environmental contamination on that site, as part of that appraisal process. Bohn agreed that appraisal
would need to be conducted separately. The State may very well not provide a formal determination that
there is no environmental contamination on the site, in which case the City may need to obtain the
authority to go onto the property and conduct its own environmental investigation.
Proulx asked how Bohn proposes accomplishing step 1, about obtaining clarification from Common Council
about the ground floor activation issue. Bohn replied Common Council wanted that to be a formal
commitment by the developer, so the IURA should try to obtain a specific definition of “active ground floor
uses.” He is not sure, however, if the IURA will be able to get clarification on the issue, because he
suspects Common Council will respond to the details of what is being proposed.
Flash remarked if “active ground floor uses” is meant to include ground-floor retail in The Stays building
(which is how one Common Council member appeared to portray it), that is not something FLD could
commit to. He is also concerned about the ramifications of incoming Common Council members and their
own interpretations of “active ground floor uses.”
Proulx observed Common Council amended the “WHEREAS” in a manner that suggests the IURA imposed
the “active ground floor uses” condition itself, when that was not the case. Proulx agreed with Flash that
the “active ground floor uses” term is too broad and the intent is not clear. Perhaps the IURA could return
to Common Council with a revised version of the resolution, to clarify the nature of that particular
commitment by the developer. For example, it could state: “Commitment from Developer to explore
including active ground floor uses without reducing affordable housing.”
Hamilton recommended modifying the ENA to address the concern and not delay the process. Bohn
replied, while the IURA could certainly change the ENA, if it conflicts with Common Council expectations it
may not gain its approval.
IURA EDC Meeting Minutes
August 18, 2021
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Flash proposed approaching Common Council again 45 days after the ENA is executed. Proulx agreed.
Dylla suggested identifying alternate ways of phrasing “ground floor activation” (e.g., referring to public
activities).
Bohn noted the ENA does contains an “IV. Issues to Be Resolved” section. The Committee could add the
ground floor activation issue to that section. Hamilton agreed.
Dylla remarked the milestones table is not entirely clear to him. Flash replied the number of days in each
step represents the number of days after the prior step, although the first three steps are
simultaneous/concurrent.
Hamilton suggested clarifying that step 5 takes place 30 days after step 4.
Proulx proposed separating the second part of the table entirely, beginning with step 5.
Proulx asked if there are any issues or concerns with the “C. Essential Terms & Conditions” section. Bohn
replied he is fine with “1.” and “2.” But “3.” is beyond the scope of the IURA's authority, since it commits
the City to being “responsible to provide sufficient utilities and existing roadway.”
Flash explained he added the sentence about the City being responsible to provide sufficient utilities and
existing roadway to emphasize that the developer would not be responsible for designing and constructing
all the infrastructure.
Hamilton suggested, rather than stating the City would be responsible to provide the utilities and roadway,
adding the following wording to the end of the first sentence: “subject to provision of sufficient municipal
utilities and the existing roadway.” Bohn indicated he does not see a problem with that change.
Proulx observed pages 6-7 again appear to contain routine clarifications.
Bohn noted page 7 contains the “IV. Issues to Be Resolved” section, which is where the Common Council’s
condition about “active ground floor uses” could be addressed, as well as any issues concerning the DEC
and the Coast Guard Auxiliary site.
Hamilton recommended also submitting a resolution to Common Council requesting clarification of the
“active ground floor uses” issue.
Flash suggested “ground-level” would be a better term, since both the Ithaca Neighborhood Housing
Services (INHS) and ‘hometel’ buildings are not permitted to have commercial uses on the ground floor.
Proulx proposed the following language: “The developer agrees to commit to develop strategies and
programming on Inlet Island to enhance ground-level activity and attract residents to Inlet Island.”
IURA EDC Meeting Minutes
August 18, 2021
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Hamilton proposed adding a reference to including “public access to amenities.”
Hamilton moved, seconded by Dylla, to adopt the Exclusive Negotiation Agreement (ENA), as amended:
Carried Unanimously: 3-0
V. Other Business
A. IURA Financials Review: June 2021
Bohn reported that the Grants Summary shows all CDBG and HOME projects are in good standing, in terms
of expenditures and progress on those projects. Most loan payments are current. All lease payments are
current, as of today. Bohn added the IURA is waiting to access its 2021 HUD Entitlement Program and
additional CDBG-CV funding. Once that occurs, all those projects will be added to the report.
Bohn reported the INHS Founders Way Rental Housing Project is well underway. The Founders Way For-
Sale Townhomes component of the project, however, has been running into major cost overruns. INHS is
not yet sure if it can close the gap. It has asked the County for additional funding support.
B. Staff Report
None.
VI. Adjournment
The meeting was adjourned by consensus at 5:06 P.M.
— END —
Minutes prepared by C. Pyott, edited by N. Bohn.