Loading...
HomeMy WebLinkAbout06/26/1995 RECORD OF PROCEEDINGS Minutes of Special Meeting of Dublin City Council Meeting pAVTON LEGAL 9LA K Held June 26, 1995 19 Mayor Campbell called the Special Meeting of the Dublin Ciry Council to order at 7:30 p.m. on Monday, June 26, 1995. R 11 11 Council members present were: Mayor Campbell, Mrs. Boring, Mrs. Stillwell, Mr. Strip, and Mr. Zawaly. Mrs. King and Mr. Kranstuber were absent (excused). Staff members present were: Mr. Hansley, Mr. Foegler, Mr. Smith, Ms. Grigsby, Ms. Clarke, Ms. Bearden, and Ms. 1?uskarcik. Mayor Campbell noted that this meeting has been called for the purpose of consideration of legislation relating to economic development projects on the McKitrick site and a waterline extension for Avery Road. Ordinance No. 52-95 (Amended) - An Ordinance Authorizing the Execution and Delivery of Various Real Estate and Economic Development Agreements Between the City, Whitmire Distribution Corporation and Cardinal Health, Inc. to Induce Whitmire Distribution Corporation to Acquire the McKitrick Office Park and to Construct Thereon at Least 160,000 Square Feet of Office Space in Order to Increase Employment Within the City, and Declaring an Emergency. (Second Reading) Mayor Campbell stated that staff has suggested that all of the interrelated ordinances be read first and then to have a presentation on the entire group of ordinances from staff. Mr. Strip noted that he has no problem with proceeding in this manner, but due to the number of land acquisition matters involved, he would request an executive session at this time. Mr. Strip so moved. Mayor Campbell seconded the motion. Mayor Campbell suggested that all of the ordinances be read prior to adjourning to executive session. Mr. Zawaly asked for clarification regarding Ordinance No. 55-95 which is not listed for emergency action. Mr. Foegler responded that it is not proposed as emergency legislation this evening. It involves an agreement that addresses a contingency should the Cardinal project not proceed. Ordinance No. 53-95 (Amended) - An Ordinance Authorizing the Execution and Delivery of Various Real Estate and Economic Development Agreements Between the City and the Alter Group, Ltd. and the Dublin Area Community Improvement Corporation to Induce the Alter Group, Ltd. to Acquire Certain Real Property Within the City and to Construct Thereon At i Least 120,000 Square Feet of Office Space in Order to Increase Employment Within the City, and Declaring an Emergency. (Second Reading) Ordinance No. 5495 (Amended) - An Ordinance Authorizing the Execution and Delivery of a Real Estate Exchange Agreement and Other Appropriate Real Estate Agreements Between the City and the Dublin School District, and Declaring An Emergency. (Second Reading) II li Ordinance No. 55-95 (Amended) - An Ordinance Authorizing the Execution and Delivery of an Amendment to the Real Estate Purchase Agreement dated February 2, 1995, as Amended, Relating to the Purchase By the City of All or a Portion of the McKitrick Office Park and Declaring an Emergency. (Second Reading) Ordinance No. 56-95 - An Ordinance Authorizing an Advance from the Capital Improvements Tax Fund to the McKitrick Tax Increment Financing Fund, Appropriating Funds, and Declaring an Emergency. (Second Reading) Ordinance No. 57-95 - An Ordinance Amending the Annual Appropriations for the Fiscal Year Ending December 31, 1995 for the Purpose of Complying with Provisions Included in Various Real Estate and Economic Development Agreements Related to the Development of the McKitrick Office Park, and Declaring an Emergency. (Second Reading) Vote on the Motion to Adjourn to Executive Session - Mr. Strip, yes; Mrs. Stillwell, yes; Mayor Campbell, yes; Mr. Zawaly, yes; Mrs. Boring, yes. Mayor Campbell announced that the meeting will be reconvened following the executive session. Mayor Campbell reconvened the meeting at 8:10 p.m. RECORD OF PROCEEDINGS Minutes of Special Meeting of Dublin Ciry Council Page 2 Meetin N LF AL BLANK O. F RM 1 14 j Held June 26, 1995 19 Mr. Foegler introduced Virginia Benjamin, bond counsel and added that Mr. Smith and Mr. Wilkerson aze also available to respond to questions. Mr. Foegler stated that these agreements follow up the 1994 tax increment financing legislation for the McKitrick property. The agreements authorize the necessazy real estate transfer and define the particulaz economic development agreements for the two projects the City has been working on. These include the national headquazters for Cazdinal Health and the development by the Alter Group for the CellulazOne headquarters facility. The site as rezoned by Council on June 19 will accommodate approximately 1 million squaze feet of office space. At full development, that would produce at today's real property tax rate an annual increment of about 1.75 million dollazs. Thus, a five-yeaz capture of the full development scenazio would produce for the City $8,750,000. This gives Council a sense of the TIF revenue producing capacity of the project. He then highlighted the basic Ciry investments and the basic commitments on the part of the private entities. 1. The Ciry will contribute $1.7 million toward the land acquisition for Cazdinal Health. This includes $1,285,00 of assistance to Cazdinal Health in acquiring the property; the remaining $500,000 represents a portion of the right-0f--way acquisition costs. The total purchase price of the land Cardinal intends to acquire is in excess of $6.2 million. 2. The City will contribute $750,000 related to the CellulazOne development of the site. 3. The City will construct the proposed Dublin-Coffman connector road which staff is recommending as afour-lane boulevazd with associated improvements, including street lighting, bikepaths, sidewalks, some sanitary sewer extensions, stormwater and public water. The total cost is estimated to be $4.7 million. 4. The City is also executing a land exchange agreement with the Boazd of Education providing for a payment to the Board of 0$100,000 for the vazious impacts on sports fields. 5. The City will provide for mitigating screenings that allow sepazation of the school activities from the roadway and ensure safety for those using the fields. This is estimated at 0$100,000, and is subject to additional negotiation. 6. The City will need to acquire the 1.2 acre Blankenship property as was indicated through the rezoning process. He noted that all of these costs except for the $1.285 million land write-down aze structured so that they aze TIF reimbursable costs. The agreements provide that in exchange for these commitments, and triggered by vazious activities: 1. The Alter Group, along with CellulazOne agrees to construct a corporate headquarters facility initially of 120,000 square feet with a minimum value of $10.8 million. The project is to be initiated within 30 days of obtaining title to the property. 2. The Alter Group is also obtaining an option to do additional development of a similaz 120,000 square ft. building that is not obligated by the agreement. 3. A mandatory income tax provision is being negotiated with the Alter Group and CellulazOne and may be structured as a cumulative figure over a period of time. 4. Cardinal Health is committing to building a 160,000 squaze ft. building with a minimum cost of $12.8 million. If the building is not completed by a specified date, in this case, by June 30, 2000, Cardinal Health agrees to repay the City the $1.7 million subsidy with interest. ~ 5. Cazdinal also agrees to provide 14 acres of right-0f--way to the City for the roadway i. improvement. 6. Cazdinal agrees to provide a minimum payroll of 03.57 million ne cumulative to the Ciry by December 31, 2005. He added that this has been structured as a net figure because to some extent, Cardinal will still be leasing some space in the Duke facility where the City nets 65 percent of that income stream as 35 percent is shazed with the schools. This provision guarantees a net amount to the City by a specified date. He also noted that Cardinal Health has plans on the site of approximately 60 acres for a headquarters which when fully developed could easily accommodate 700,000 squaze ft. of office space. The Alter Group is negotiating an option for an additional 10-acre site on which to duplicate 120,000 squaze ft. of office space. Conservative payroll and building construction projections by Cazdinal Health and total payroll tax revenues and service payments in lieu of taxes that the City will net should be in excess of $8 million, cumulative, by the year 2004 under their conservative estimates. Mr. Foegler emphasized that the ability of the City to leverage a significant portion of the financing of this important Dublin-Coffman connector roadway project with TIF service payments from two such desirable corporate headquarters facilities is one of the key economic benefits of these projects. II RECORD OF PROCEEDINGS Minutes of Special Meeting of Dublin City Council Page 3 Meeting _ _ DAYTON LEGAL BLANK CO.. FORM NO. 10148 Held June 26, 1995 19 Discussion followed about the timeframes for full development of the site and the relation to the amount of real estate tax generated over the first five-yeaz period. Mr. Foegler emphasized that the state legislation does authorize 30 yeazs for the recapture period. In response to Mayor Campbell's questions, Mr. Foegler stated that: 1. The 120,000 square ft. building committed to by CellulazOne and the 160,000 squaze ft. building committed to by Cazdinal Health will produce $2.4 million in real estate taxes over S yeazs, based on $1.75 per squaze 8. This results in $2.4 million dollazs of TIF to be ~ recaptured over a period of up to 30 yeazs. ~ 2. The covenants require that the TIF payments aze recorded with the land at the real estate closing. The covenants then run with the land, and any future user who develops this ~i property would have the same TIF cost recovery potential. 3. As a general rule of thumb, a 120,000 squaze ft. office building will produce in excess of $300,000 of income tax per year. 4. Cardinal Health's projections for municipal income tax growth aze $473,000 for 1995, $556,000 for 1996, and over $924,000 for the year 2004 based upon planned consolidation. 5. Whitmire is the company that holds the real estate on behalf of Cazdinal Health, but Cazdinal is a party to all of the agreements involving performance obligations and repayments. Mr. Zawaly asked for clarification that Whitmire is the holding company for real estate only, that all of the TIF commitments being made aze still being made by Cazdinal Health Industries. Mr. Foegler confirmed this. Mr. Zawaly noted that Ordinances 52, 53, and 54-95 will require amendments to include the i language involving the wholly-owned subsidiazy, Whitmire. Ms. Benjamin confirmed that these amendments aze necessazy, along with a couple of other minor changes. I i Mrs. Boring asked: 1. How this project will be financed up front prior to the service payments from the T1F? j Ms. Grigsby stated that it would be financed through debt issuance, and repayment of the principle i and interest would be through service payments. ~ Mr. Foegler added that the City's debt authority is abundant in roads by virtue of the voted debt authority for transportation improvements approved by the voters in 1990. 2. Who will own the single-family acreage after these negotiations aze complete? Mr. Foegler responded that Cardinal Health can either sell or develop this land, subject to the City's ~~j zoning restrictions and process. ~ 3. How is the land acquisition subsidy being financed? Ms. Grigsby responded that out of non-tax revenues, $1.285 million will be appropriated and then i. $1.275 will be appropriated for right-of--way acquisition based on an advance from the capital fund. The 1995 budget estimated an allocation of $1.8 million for this purpose. i~ Mr. Strip commented that this project underscores that nothing breeds success like the look of success and prior success. It will do much more than just bring two industries to the City. Mr. Zawaly asked Mr. Foegler as the Assistant City Manager and Director of Development to ~I confirm that he has done what Council gave him the authority to do by virtue of the agreements i before Council tonight. i Mr. Foegler responded that he believes these agreements fulfill the direction staff received from Council in terms of the nature as well as the kind of benefits and protection provided to the City. } Staff is recommendin a rov g PP v ~ I, Mr. Zawaly thanked all of the staff members who have worked on this project, but especially commended Mr. Foegler for the long, azduous hours spent on assembling this economic development project. Mr. Strip: 1. Commended the City Manager for his leadership role, and Mr. Foegler and Ms. Grigsby for their efforts. 2. Noted that this City has worked hard to mitigate the impacts upon the residential neighbors of this project. 3. Thanked the Dublin Schools for have made this possible and the School Board members who l have cooperated in this effort which will make Dublin a better city. 4. Praised Mr. Zawaly who was very influential and took an active role in this effort, and ' Mayor Campbell who also spent an extraordinary amount of personal time on this project. ~ I~ ~I I, RECORD OF PROCEEDINGS Minutes of Special Meeting of Dublin City Council Page 4 Meeting DAYTON LEGAL BLANK 00., FORM NO. 10148 Held June 26, 1995 19 Mr. Smith noted that emergency action is needed due to the closings set for late this week. Staff is requesting that the third reading of the ordinances be waived and that emergency action taken, except for Ordinance No. 55-95 where staff is r uestin that it be held over f r eq g o thud readin on g July 17. He noted that the four ordinances will also need to be amended. Ms. Benjamin stated that Ordinance No. 52-95 authorizes the execution and delivery of vazious j agreements between the City, Cazdinal Health and Whitmire, authorizes the assignment and real estate purchase agreement which is the assignment of the City's rights to purchase the McKitrick property to Whitmire, and authorizes the tax increment fmancing economic development agreement i to which Whitmire, Cardinal Health and the City are parties. The amendments needed for Ordinance No. 52-95 aze to add Whitmire as a party to the tax increment financing and economic development agreements. ~ Mrs. Boring asked in regard to point number 22 about the proposed timeline for capital j unprovements and whether this would bind future Councils. ~I j Mr. Smith clazified that the language that the City accepted was that Council will give its best efforts I i as permitted by law. ~ ~i I; Mr. Zawaly moved to amend Ordinance No. 52-95 per the revisions before Council tonight. I Mrs. Stillwell seconded the motion. Vote on the motion -Mrs. Boring, yes; Mayor Campbell, yes; Mrs. Stillwell, yes; Mr. Strip, yes; Mr. Zawaly, Yes • II Mr. Zawaly moved to waive the three-time reading rule and to treat this as emergency legislation. ~ Mr. Strip seconded the motion. ' Vote on the motion -Mrs. Stillwell, yes; Mrs. Boring, yes; Mr. Zawaly, yes; Mr. Strip, yes; Mayor ~ Campbell, yes. Vote on the Ordinance -Mayor Campbell, yes; Mr. Zawaly, yes; Mr. Strip, yes; Mrs. Stillwell, yes; Mrs. Boring, yes. ~m_ w ~ I Ii Ms. Benjamin stated that Ordinance No. 53-95 is the ordinance authorizing two agreements relating to the Alter parcel. The amendments include reflection that Whitmire is the entity taking title to the j; property. There are also some revisions based on survey work with respect to the acreage being ' . transferred to the CIC and then to Alter and property that Alter is purchasing directly from Cazdinal. Mrs. Stillwell moved to amend the ordinance to incorporate the revisions before Council tonight. ~ ~ ~ Mr. Strip seconded the motion. ' ~ Vote on the motion -Mrs. Boring, yes; Mr. Zawaly, yes; Mr. Strip, yes; Mrs. Stillwell, yes; Mayor Campbell, yes, Mrs. Stillwell moved to treat this as emergency legislation and waive the three-time reading rule. ~ j Mr. Strip seconded the motion. ~ Vote on the motion -Mayor Campbell, yes; Mrs. Stillwell, yes; Mr. Zawaly, yes; Mrs. Boring, yes; ~ l Mr. Strip, yes. 'i~ Vote on the Ordinance -Mrs. Borin es• Mr. Zawal es• Mrs. Stillwell es• Ma or Cam bell g~Y ~ Y~Y >Y Y P yes; Mr. Strip, yes. I Ms. Benjamin stated that Ordinance No. 54-95 authorizes the City to enter into a real estate exchange agreement with the school district whereby the City will exchange two parcels with the school district that will enable the road to be built as presently configured and will enable the schools to reconfigure their fields in accordance with the plans that they have discussed. The amendments relate solely to the fact that it is Whitmire that will be taking title to the property. Mr. Strip moved to amend to incorporate the revisions before Council tonight. Mr. Zawaly seconded the motion. i. ~ Vote on the motion -Mrs. Stillwell, yes; Mr. Strip, yes; Mrs. Boring, yes; Mayor Campbell, yes; Mr. Zawaly, yes. Mr. Strip moved to waive the three-time reading rule and treat as emergency legislation. Mrs. Stillwell seconded the motion. Vote on the motion - Mr. Zawaly, yes; Mayor Campbell, yes; Mrs. Boring, yes; Mrs. Stillwell, yes; Mr. Strip, yes. Vote on the ordinance - Mr. Strip, yes; Mr. Zawaly, yes; Mrs. Boring, yes; Mayor Campbell, yes; Mrs. Stillwell, yes. Ms. Benjamin stated that Ordinance No. 55-95 is a contingency agreement which would authorize an amendment to the purchase agreement between the City and the entities which own the Mcl{itrick property if for some reason the transaction did not take place. This is solely presented for second reading. RECORD OF PROCEEDINGS Minutes of Special Meeting of Dublin City Council Page 5 Meeting DAYTON LEGAL BLANK 00., FORM NO. 10148 Held June 26, 1995 19 Mr. Hansley requested that this be held over for a third reading at the July 17 Council meeting. Mayor Campbell confirmed that Ordinance No. 55-95 will be held over for third reading on July 17, 1995. Ms. Grigsby stated that Ordinance Nos. 56 and 57-95 provide the funding for the right-of--way acquisition as well as for the incentive agreements. Emergency action is needed due to the closings this week. There are no amendments to these ordinances. Mr. Zawaly moved to waive the three-time reading rule and treat both 56-95 and 57-95 as I'! ewer enc le islation. g Y g Mr. Strip seconded the motion. Vote on the motion -Mrs. Stillwell, yes; Mayor Campbell, yes; Mr. Zawaly, yes; Mrs. Boring, yes; Mr. Strip, yes. I Vote on Ordinance No. 56-95 -Mrs. Stillwell, yes; Mr. Strip, yes; Mr. Zawaly, yes; Mayor Campbell, yes; Mrs. Boring, yes. Vote on Ordinance No. 57-95 - Mr. Strip, yes; Mr. Zawaly, yes; Mayor Campbell, yes; Mrs. II Stillwell, yes; Mrs. Boring, yes.. Ordinance 58-95 - An Ordinance Authorizing the City Manager to Enter into an Agreement ~I ~ with Dublin Building Systems for the Avery Road Waterline Extension, and Declaring an Emergency. (First Reading) Mr. Strip introduced the ordinance. ~ Mr. Strip moved to waive the three-time reading rule and treat as emergency legislation. Mr. Foegler stated that this legislation is afollow-up to authorization received recently from Council regarding a waterline extension to serve Coretest Columbus Technologies which is being developed j; on Avery Road. Based on previous discussion, staff is recommending that Council take action to II approve this agreement providing for the reimbursement to DBS for the construction of that I,; waterline from Avery Road to the Coretest Columbus Technologies facility. Emergency action is requested due to the need to begin construction on the facility immediately. ~ Mayor Campbell added that there is an economic development factor involved in terms of the payroll A ~ tax benefits to the City. ~ ~ Mr. Zawaly seconded the motion. Vote on the motion -Mrs. Boring, yes; Mr. Strip, yes; Mrs. Stillwell, yes; Mr. Zawaly, yes; Mayor Campbell, yes. I' Vote on the ordinance - Mr. Zawaly, yes; Mayor Campbell, yes; Mr. Strip, yes; Mrs. Boring, yes; ~ Mrs. Stillwell, yes. Mr. Stri withdrew his re uest for the ex iv i n h wn n n ~I p q ecut a Bess o s o o the age da. Mayor Campbell made closing remarks about his appreciation of the time and effort spent by many people on these economic development projects approved tonight. They will solidify the economic health of the Dublin community for decades into the future. Because of this type of economic development, the community is able to provide the amenities the citizens enjoy.. He thanked all who attended tonight's Special Meeting. The meeting was adjourned at 9:40 p.m. May - Presid g Officer i i ~~~1.~~-~-' i Clerk of Council i,