Affordable Housing Advisory Committee - Regular Meeting

That's good. Thank

you. I can't take the credit.

Alright. It's 03:30. Thank you. Okay. Good afternoon, everybody. It is Tuesday, 11/04/2025. It is now 03:30, and I am calling the Ocala Community Redevelopment Area Agency Board to Otter. Order. Order. Can I have a roll call, please? Order. Order. Order. We're starting out well. Yes. Miss mister Marciano?

Here. Mister Bethea?

Here.

Mister Hilty? Here. Mister Musley? Present.

Miss Dreyer? Here. And did

we have public notice? Yes. The 11/04/2025 CRA meeting was publicly noticed on 10/08/2025 on the City Of McAllister's website. Thank you.

Thank you. And if everybody has had an opportunity to review the minutes, I will entertain a motion.

So moved.

Thank you. Second. Thank you. Are there any comments from the public on that agenda item? Any council comments? Please call the roll. Mister

Mister Bethe?

Aye.

Miss Dreyer? Aye. Okay. Agenda item five a is applications to fill the vacancy on the downtown Ocala redevelopment advisory committee for an expired term ending 03/01/2029. Presentation by Roberto Ellis.

Good afternoon, Roberto Ellis, economic development manager. So there is one vacant position on the downtown Ocala advisory committee. We have four applicants. The applicants are Billy Mallory, Donald Dolan, Jamie Zimbleman, and Brian Carciolo. The CRA board is being asked to vote and elect one person to serve until March 2029. The applicants were not selected. Their applications will be held held for future

vacancies. Okay.

And Roberto, who are they replacing?

So Rachel Laxton, I believe.

Okay. Yeah.

Do you have a board matrix? I know each board typically has a makeup of who they wanna see so that you have some variety. Do we have that for this board?

So for this one, the resolution outlines that it the members may be property owners or persons from organizations representing the downtown community.

Got it. Okay. Thank you. Okay. I will entertain a motion on this agenda item.

Yeah. We have to vote, and then we'll move the motion to elect who's a successful person.

Okay. Sorry. Alright. So y'all have your ballots in front of you. This is

in Chicago. You only vote once.

You have all the government jokes today. It's good.

Okay. Gotcha. Thank you.

Okay. So I was gonna sit down. The CRE appoints Donald Gulling to the downtown CRA advisory board. Mister Hilty voting for mister Donald Gulling, miss Dreyer, Donald Gulling, Bethe, Jimmy Jamie Zimmerman, and miss Musley Donald Gulling.

Okay. So

do we now need a motion to approve that? Okay. I will entertain a motion to approve Don Gulling to the Ocala Downtown Ocala redevelopment advisory committee.

So moved.

Thank you. Second. Thank you. Are there any comments from the public on this agenda item? Any further council comments?

Alright. So why do we need a a motion and

a second

when we vote it?

I don't know. We're just doing what the lawyer tells us.

I I

understand. Lawyer's never wrong. It's like the clock back there in the in the

city of Mo. Oh,

it's gonna be an interesting day. Good luck to all of you. Okay. Can I have a roll call, please, ma'am? Miss Is that like a recap, Mister Hilty. Mister Hilty.

Miss Aye. Aye.

Is that for him?

Mister Bethe. Aye. I'm sorry. Mister Musley.

Present.

Miss Group. Miss Dreif. Aye.

I can really be a pain. I can tell. We can tell.

I understand.

We can tell. You're a whole vibe today. It's good. Okay. Motion passed. Congratulations. I see him back there. Item five b is the approval of a West Ocala CRA residential property improvement grant. Is there a motion to approve this item? So moved. Thank you. Is there a second?

Second. Don't do it all at once. Thank you.

Go ahead, Roberto.

So this application was submitted by miss Linda Wilker Wilkerson. Early this year, a rate event caused damage to a section of her fence. She is proposing to replace the wooden fence with a tan vinyl fence based on the estimated cost of $4,380. She qualifies for a maximum amount of $3,285. Staff recommends approval.

Okay. Are there any comments from the public on this item? Any council comments?

The only thing is but you said it was damaged. Was there no insurance opportunities for this?

Not that I'm aware of. Okay.

Probably. But I think the fence is even if she didn't have a fence, the fence would still be covered if she wanted to install a fence. Do you know what I mean?

Yeah. No. I don't have a problem with installing a fence. Yeah. But I didn't want an upgrade. That's that's what I was, you know, trying to be. Are we upgrading from wood to bottle? So Do the bottle cost wood?

When we did the the side visit, there was some sections of the fence that were rotting. So that could be one reason why she's moving towards a a vinyl fence.

I'm good. Okay.

Well, I think the answer is yes. It is being upgraded from the wood to the vinyl.

Let's move on.

Okay. Alright. Please call the roll.

Mister Bethea?

Aye.

Mister Busley?

Aye.

Miss Steele?

Aye. Miss Dreyer? Aye. Item five c is the approval of a West Ocala CRA residential property improvement grant. Is there a motion to approve this item?

So moved.

Thank you. Second. Thank you. Go ahead, Roberto.

So this is our quest to for CRA funds to con to assist with construction of a single family home in the West Ocala CRA. The project is being done by DNS development represented represented by Dewan Thomas. It will be 1,200 square foot of a livable area at a cost of $136,000 and the expected sale price will be $230,000. This is one of those properties that was transferred in our affordable housing surplus lot program. When it's finished, it will be sold to a low to moderate income also and be held within those affordable thresholds for a minimum of 10 board.

And

then

to

do, and it's actually gonna involve get both the five c and five d. And Same question because the same parties are involved in this year.

But Okay.

If you remember back in March, I had some concerns about a similar situation with Antoinette Hunt who sits on the CRA committee getting the piece of property and then coming back for the $20,000. Now you have a similar situation. Another council member of this committee coming in for two pieces. In both cases, they they purchased the property under their company name, and now they're filling out the application under an individual name. And the reason is, I see it, is because the CRA rules say to encourage residents of single family and duplex homes.

They're not residents. They own the property, but they're not residents. Now I'm all for affordable housing, which is this is supposed to be, but going back again to the other one, her estimated costs were 159 to 170,000. And then she reports that it could be worth up to 250,000, which meets the affordable housing criteria. As an individual, if I put my hat aside and just look as an individual, this does not look right.

We now have two people on that committee now getting and I don't know what those pieces of property went out for bid or not. I haven't researched back, but it just seems there is some complexity in that. Now she signed a conflict of interest because she wasn't there. Conveniently, he wasn't there, so we didn't have to sign a conflict of interest at the meeting. I just need an explanation as to why and full transparency as why committee members are allowed to do this.

So based on how our program is structured, we we have we accept application

You're speaking to the mic for the

Sorry about that. Based Based on on how how the the the program framework is is set up, we accept applications for residential properties. The end goal is to always reduce blight in cases in our West Ocala CRE area. Currently, our program framework doesn't prevent persons who sit on our committees from applying. They would have to declare the conflict of interest.

Miss both miss miss Hunt and mister Thomas, they fill out the the required forms to declare our state your conflict for the record. Outside of that, we'd have to consider maybe adding language in our grand framework that kinda limits or or limits those who are eligible to apply for applications. But currently, it serves the housing needs of the West Ocala CRA. That is the underlying intent of it. If if we are looking at the ownership, we can also look at what ownership categories could qualify for a grant. But currently, there's no I changed

this year.

Yes.

That's says residency. But, also, I still have a problem with the committee member, and now it's happening twice. Actually, three times, because he's getting two pieces and she got one. Committee members should not be allowed to do something like that at all. A lot of committees I sit on, I had to recuse myself from participating in any businesses or or things of that nature. If they wanna sit on the committee, that should be the case. So because it appears to know they can make quite a bit of money only because of where they sit. They had the inside track on on what pieces were available. They knew how to fill out the application. Does anybody have any am I just seeing this wrong?

So specifically for these two properties that went through the affordable housing surplus lot program, they went through a public noticing process where the bids are reviewed by our procurement department, and he was selected as the member. One of the the benefits of the CRA is that we help provide funds to to deliver housing at a more affordable cost. So that's why he's applying for the program to take advantage

of that. That surplus prop man, I think this is it. The report that the surplus property didn't come back through the CRA. Right? The surplus property went through the procurement department.

That's correct.

But it didn't go through that was had nothing to do with the CRA.

Yes. This is a separate process.

Right. It's a separate process. So that it's open to the public. It's advertised. He was selected by a selection committee or Correct. Yes. And then this CRA, he's using this money for permits?

So a proportion of the cost is the cost

the of surplus lots was of to get these lots into developers' hands to build primarily to build affordable housing units. He's committed to build an affordable housing unit on this to have liens put placed on it for up to ten years. Correct? Correct. And and then the lots in the CRA, so he gets to participate in the CRA program. Correct. Correct. And you don't distinguish. There's nothing. He he didn't sit on the on the board the day that they decided to recommend approval of this.

Doesn't matter.

But but that's really important under the chapter one twelve analysis. It's it's this board, the CRA board that's distributing the funds. Yeah. It was kept there. The the the board that this gentleman sits on is only making a recommendation to this board.

They don't have the decision making authority to so even if he had participated in the meeting and if he had voted on it, he isn't that board isn't giving him the money. It's the five of you or the four of you today sitting as the CRA advisory board Right. That distributes the money. So I'm disputing the optics, but from a technical analysis under chapter one twelve, which we did back in March, that added layer is protecting the city from someone making

Yes. A I mean, got that explanation yesterday when I went back and looked at this. This is now the third time, if you will, of somebody on that committee doing this, and and I'm looking at it from the public's view. It doesn't look right.

Well, if we if we have developers on or builders on our CRAs, it's it can continue to happen.

So do we just because we have on an agenda coming up one with not a lot of proclamations. The discussion that Councilman Buffet was concerned about with having LLCs, right, get multiple grants through the CRA. Do we wanna add this discussion to that same agenda item? And maybe you think about what that looks like going forward and how what recommendation you want to make to change that? Do we still want to add that to it?

Yeah. Absolutely.

Okay. So there's yeah. There's another possibility. We've talked about it at the staff level about what actually goes to, you know, this. You are sitting as the community redevelopment authority. You are the CRA right now. Their advisory. Advisory and you know, we don't have to take all of those things to do to that advisory board. When when we start to my concern is affordable housing is important to all of us. And we don't want to narrow the pool. People who are gonna develop affordable units. And so I I'm I'm very concerned about narrowing that pool. So there are some other ways that we can we can do this.

Oh, well, and Dwan Thomas, you want him to keep building these. He's a great builder, and he built it. Yeah. So but I hear what you're saying. At the same time that.

I'm just

saying that. Hear

what you're saying.

So let's just add that to the discussion with maybe some

other options. Mhmm. And just take it take it straight to us.

Okay. That's what we could do.

And that's what we

have do. A

guy like him on the on the CRA.

And that's

Board because he can advise on other things. You know? And if if optics are a problem, then just take it straight to us and don't even let them vote on it.

Yeah. So add that as the recommendation to avoid the issue that councilman Kelsey is concerned. Can we do that? Yes. Okay. So are there any other comments or questions on this agenda item? Hearing none, please call the

roll. Mister Musley?

Aye.

Mister Bethea? Aye. Mister Hulte?

No. Miss Dreyer? Aye. Item five d is the approval of a West Ocala CRA residential property improvement grant. Is there a motion to approve this item?

So moved.

Thank you. Second. Thank you. Go ahead, Roberto.

So this property is located adjacent to the one that we just discussed on Northwest 2nd Street. The the house will be constructed for a similar cost and be sold at a similar price point of $230,000. They were reviewed by the advisory committee on September 24. Staff is recommending approval. The advisory committee recommended approval. Okay.

Is there any comments from the public on this item? Any council comments or questions? Hearing none, please call the roll.

Mister Bethe?

Aye.

Mister Musley?

Aye.

Mister Hilty?

No. Miss Dreyer? Aye. Item five e is the approval, excuse me, of the re redevelopment agreement or the rehabilitation and redevelopment of the historic Ocala Marian property. Is there a motion to approve this item?

So moved. Second.

Thank you. Presentation by planning director Aubrey Hill.

Good afternoon. Aubrey Hill, planning director. So this is a redevelopment agreement between the city of Ocala and Marion Opportunity Zone one LLC. This item supports the strategic goals of quality of place and economic hub. In the early two thousands, the city of Ocala recognized the importance of the downtown area, but realized that it also lacked a kind of a vision and proper guidance that was needed to make sure that it was successful in its redevelopment efforts.

In 2004, the city completed the Downtown Master Plan, which continues to provide implementable redevelopment have also been provide new additional business we focus areas and studies that have been done in this area. As of 2019, the Downtown and Midtown Master Plans were incorporated into the Downtown CRA plan itself, which really highlights vacant underutilized properties, removal of slum and blight, how do we and also provided some additional strategies as we move forward as well as catalytic sites. Additionally, in 2024, the city started a process to extend its or update its 2035 vision to go to the year 2050. We're currently working with Kimberly Horn on that initiative. But we also had a sub consultant, Urban three, that conducted a financial stability analysis that was the economics of community design and examined the land value economics, property and retail taxa analysis and benefits for the city of Ocala.

And specifically highlighted a lot of the downtown midtown area as part of that. So the subject property is located at 108 North Magnolia Avenue and is the site of the Marion Hotel, which it is actually coming up on its one hundred year anniversary in 2027. So, this is a very important historic site for the city. And the developer has purchased the property which was in a condominium type ownership, which was a lot of long work to get that the building started to kind of fall apart. And so, the developer purchased those properties and is intending to convert this back to a 59 room boutique hotel with the Hilton Tapestry Collection brand as its title.

So we've been working on an incentive package with them for a number of months and have come up with an incentive agreement that is very similar in nature to the one that was recently approved for the Yasting Marriott Hotel, where it maximizes our incentive target at 10% of the developer's cost. And in this case, it's approximately $29,000,000 that they will be required to put into this facility with a maximum city incentive for that 10% coming out to almost $2,900,000 And that's again, that's a base amount. So, there's allows for some flexibility within this agreement but at no point would that incentive target be breached. So, this has been kind of a unique situation in that the AC Marriott, while it was under construction, the city already had a site located for the Parking Garage Number 2, which was going to provide public parking for the greater area, but also had the ability to incorporate some parking into that parking garage facility. We realized the city realizes that there is a need for a future parking garage, but the timeframe of that is kind of up in the air.

So, this agreement had to balance that those needs of developer as well as our ability to service that the parking need. So currently, there is a the list of incentives that we're looking at in this agreement are a city grant of about $650,000 that will be paid in equal disbursements over a five year period, which comes out to roughly about $130,000 per year for five years. We'll also include a city review contributions, will be in the form of a reimbursement back to the developer in an amount of $79,460 This reimburses for building permits, site permits, and the applicable impact fees. Additionally, city improvements which are very minor in this case, a lot of the work like sidewalks have already been installed through previous initiatives. But there would be an allocation for but it'd be very minimal.

We didn't actually run any kind of figures on it because it's largely just restriping and the removal of some parking meters for to for allow the developer to operate a valet service at the front on North Magnolia. And one of the and the other is is also CRA payments in the form of TIF that they would get after all they pay all of their taxes then the TIF up up to the 95% allowable that is collected would go back to the developer in that case. But again, they would have to make sure that those are their taxes are paid before the reimbursement occurs. And that would occur throughout the duration of the CRA, which is currently sunsets in 2038. However, we are going to continue to explore options for its expansion.

And lastly, the donation of Lot Number 6, but it has the right of reverter that's built into that as well. Currently Lot Number 6 contains 96 paved parking spaces. It has curbing, lighting, some landscaping within that as well. And developer is requesting basically the entirety of that lot. So as we are moving forward, the property donation aspect of gives us the ability to incorporate this into the incentive agreement with the ability for the city to kind of have like a clawback of four years and gives us some time to fully analyze which site is the appropriate site for the Parking Garage 3 location.

The city did obtain a property appraisal and that appraisal came back at almost $1,200,000 It was $1,254,000 and that factors in the 96 parking spaces, the curbing, landscaping, and all the improvements that are currently on the site. Within that right of reverter, the city will if we do choose to take the property back, we would have to pay back for that appraised value. And that can come back as either one lump sum or it can come back as multiple payments throughout the CRA. So, that if we are successful in extending the CRA, we could look at extending TIF or there could be kind of a mix of different options that will likely have to that will require an amendment to the agreement to do that as well if there's going to be some alterations on how we make the payments. But in total, that's kind of how we have envisioned this incentive agreement to come for you.

If there's any questions, staff is available. But we are in support of the project and the developer is also here.

Rob, do you wanna say something?

Good afternoon, council, mister mayor. Rob Batzel, 1531 Southeast 36th Avenue, Ocala, Florida 34471. Here on behalf of the applicant and mister Midgett, mister Boggs are also here. As usual, staff did a really thorough job in this report. We have been working we I I have to start by thanking them.

This I wanna wax nostalgic about the project, but I'm gonna try to hold off on that for a minute. We have had to really go down some interesting roads in terms of how to be creative and make sure that the city's, you know, typical approach can be accomplished here, because of limitations on the rest of the term of the CRA as we sit here today. The significant purchase price and tax basis said there have been some complications, and and this solution that's before you is really, you know, staff thinking outside of the box and working with us. So I appreciate that. I'm here to answer any questions, but in terms of waxing nostalgic, you know, we we talk about the history of the CRA and those core words, community and redevelopment.

I just can't think of project, you know, in terms of the that checkbox of community. This is an icon of our community that this structure in and of itself. And, you know, to in order to not only preserve it, but just re envision it for this next chapter is gonna be even better than the first, and that's you know, this is a property on the National Historic Register as a landmark property, and and it's really neat as someone who's grown up here to see this happening, and I hope you'll agree. And then, you know, as far as community is concerned, this is a local group of people you know who are putting their capital at risk to do it, and I think it's just really special. And then as far as redevelopment is concerned, you know, to start this story with David Midgett walking into this building to try to negotiate the purchase of a bunch of different units from condo owners and all of the pieces along the trail that lead us to today, this is true redevelopment.

It's awesome when somebody comes in and I get to tell you, hey, we're gonna you know, I already get to represent somebody who buys this and we're gonna knock everything down and build something new. That's great. That's economic investment. That checks all the boxes, but this is pure, redevelopment. Taking the old and making it new, but preserving, you know, the heritage. And, anyway, none of that is at all related to what I came to talk to you about tonight, which is just here to answer any questions if you have questions about the technical aspects of the agreement itself.

Okay. I do have some questions, but let me just go to the public really quick and see if we have any public comments. Seeing none, we're gonna close that. I just have a quick question about the parking lot. So when does that I'm just confused on this with the right of reverter. So when does that go into effect? Because you and I spoke about it, and you thought it went into effect immediately, but the contract, I don't think, says that. So

I can explain the mechanics, I think, and please correct me if I misstate anything. So beginning on the effective date, we have essentially a three month period for an inspection period due diligence and title matters like an ordinary purchase and sale agreement would contemplate. But upon completion of the hotel, the applicant will provide notice to the city and we'll be prepared to close. We'll close on the on that transaction conveying the property from the city to the applicant. There will in that deed, there will be a the language from agreement or language identical or substantially similar to it that basically provides the city with a four year right of reverter.

So as soon as the city figures out the the issues it's working through right now, effectively how and when to build that garage, they send us notice, and we convey it back to the city for the exact for the for the value in this agreement and no more.

Okay. So then the effective date would be today? Like, when I sign or what? What is effective date?

The effect on

the date of that. The

close that's that's close.

So the effective date is when you when the hotel is done.

The effective date, the right of reverter?

Yes. When when is the first day of the right of reverter of reverter? The first day.

The day that deed transfers the property to my client.

Closing of

the property. So the closing of, like, when the hotel is ready.

Okay. Yes.

Which is eighteen months?

So I don't I'm I'm not gonna get the exact, but no. It's much sooner than eighteen months from now. In the agreement, that is our deadline for completion, but no. It's going to be much, much less. Much, much, much sooner. And I was asked not to be specific in that regard.

Okay. And that's okay. I'm just in my head because four years sounds like a long time, but this is the government. Nothing is fast with the government. But it's also we if like, this was one of our top projects, and we are now not we're putting this on the back burner. So my concern is that we can't meet that four year deadline if it's sooner than later. But I'm I'm just confused because I know that we've and the term given is not the appropriate totally fine with your incentives. I have no argument on the incentives, the price, whatsoever. My only concern is the way we're going about the parking lot incentive. So, yes, we gave the Marriott the a floor and a half, but they don't own the floor and a half.

We're allowing them to use it. I'm not I'm just confused on why we're just not allowing them to use the parking lot until we build a garage. And if we never build a garage, then they just keep using the parking lot in the same way we've done it two other times.

And the that was when I mentioned that we traveled multiple paths, we crunch numbers on a number of different types of incentives, one of which would be, okay, credits to use city parking spaces downtown much like the AC Marriott approach, but that the term of that incentive was forty some odd years, forty six years, I think. Something very lengthy that really didn't allow us to recognize this in reasonable period of time. And so this was the this was staff's thought as a way to get there with a reasonable time horizon.

So would you have would you have any intention at some point of redeveloping this lot into something else? I mean, because parking is not the highest and best use of the lot. Right? Like, we really need a parking garage and then something else. So is there a higher and better use that you have intended for this parking lot at some point? Should you own it and we not take it back?

So so today, the answer to that question is no. We don't. We we are going to use it for parking and we are frankly anticipating that the city will come knocking to purchase it back and build the garage. That's the plan. But just we had a discussion prior to walking into this meeting with Aubrey since mister Midget is here in person just to say, hey. Let's talk through the city's thoughts on that because if we get a call next month from an end user who has a neat project in mind, obviously, it's it's subject to the reverter, so you all would have to release your right of reverter in order for us to proceed with any third party so you have that assurance. Mhmm. But we will have to the key is gonna be communication here if anything comes up in terms of a potential

that it's not the highest and best use is because of the point in time, right? The hotel is being built. There are 100 parking spaces there. The hotel is going have a hard time existing without those 100 parking spaces.

No, agree.

They need have this agree.

No, for the short term, it's the highest and best use. As we move forward, we've started to go down the path of trying to land on what's first of all, what's the right block for the parking garage. And we started with this one. And I've talked to each of you about our priorities moving forward this year with our penny sales tax and our engineering money. And so I think it's not our priority for 2026.

We'll revisit it in 2027. So the plan is to build a parking garage at that location within the next two to three years to begin with. We also have a lot of other blocks and portions of blocks that we're interested in getting to other developers. We we have sold a parking lot that has been is sitting vacant. We've attempted to to purchase that back, and we we could lease it, which I don't wanna do.

So I think that actually is where I'm in my head, this is where I'm at. Right? Because I see the CEP in the room. No offense to them. But, like, that building, when we gave that to them for a dollar, like, I feel like we regret that now. You know, there's certain things that we've done. Salvation Army, we have a right to revert or that we really can't ever claw that back. Like, there's certain things we've done in the past that I don't know we would do again today. So I'm just do I want them to have the parking? Yes. Absolutely. They can lease it for a dollar for all I care, but I don't I think it's a dereliction of our duty to deed them that property on the hope and the prayer we're going to build a garage in four years and we can take it back. I just don't foresee that as being a good deal

for I

don't think it's a hope and a prayer. The part of the thing is that's why it's locked in at that price. The other thing is extending the CRA. You know, extension of the CRA would give us several options as we move forward. In fact, I think does the right of reverter speak to actually building a parking garage? Is that what it says?

We would build it. Yes.

Yes. So

why did you have to lock in on a price when you can allow them to use that until such time as is determined, which you mentioned that we have to decide whether in a couple of years what they're going to or not. You talk about how strong it is. Why not let them have that parking lot? And then at the time, give it to them when when we decide we're not gonna build it there, but you're you're putting 1,200,000.0 out there saying that's the price that I'm gonna have to pay you if I now build a parking garage.

You're not gonna pay them. And, Aubrey explained you it's more likely that you would pay them through the course of the CRA. You would redo the agreement. It would be an amendment to the agreement. You'd pay them to over time.

But they're still getting paid.

They're still getting paid. They would still get paid. They would Well,

if you gave them a lease agreement for four years, you don't have to pay anything. They pay a buck. And then at the end of the four years, you know, if you haven't, then you give them a lot. You haven't paid 1,200,000.0.

Well, I think we're gonna pay the point

that that that doesn't add up to the $2,800,000 that you invested, which equals

Yeah.

10% of the total 28,000,000.

So Yeah. I think we're gonna pay the 1,200,000.0 regardless. It's the way we go about it. Right? And so according to what this says, if we utilize the right of reverter, then we pay them the equivalent of whatever, like, the 1.25. Okay. How however we would pay them, why can't we just pay them now with that? And then still allow them to use the garage or the parking lot rather.

Because part of it is we are we don't have the money budget currently budgeted to allocate the $1,200,000 to make that whole. So that's part of the reason why we also expanded that CRA grant over a five year period. We could do that through by giving us the four years, it gives us the ability to budget the additional monies to cover that cost. But currently we don't have that right now. The other side of it is, again, with the allocation and how we lease out those parking spaces and the values values that are assigned to it would never get to that 1,200,000,000 like it would end up taking about thirty years to reach that investment period.

So this is kind of just like a stop gap to kind of to get this to where it gives us the ability to finalize our plans on the Parking Garage 3 and then ultimately come back and utilize that right of reverter. Hopefully, we would also have the ability to extend the CRA. And through that extension of the CRA, we could extend our TIF. The maximum that we're looking at right now would be going to 2,048. So that would give us essentially another ten years beyond what we allow for, which would clearly give us the ability to provide those incentives that would equal out to that purchase price of $1,200,000 for the property.

Do you all have like a Hail Mary alternative option for this? Like I want you to have the full amount of the incentive, the $2,896,000. I want you to have that. I just I cannot personally get behind deeding you that parking lot. I just can't. So is there another option?

So so here's what this option, mentioned, was an idea from staff, and and so we are on board with it. I I think that listening to your concern, we can address this. Right now, and mister Lee's question was a good one, which was, is it necessary that there be, you know, a plan to immediately construct a public parking garage in the agreement? The reason the answer is yes, sort of, is because we've spent $29,000,000 on a hotel at this point or are very close to doing so, and parking is a necessary component. Right?

We have to make sure that we have parking for valet. So it's not just the money, it's also the parking. Otherwise, my answer to you would be, well, if you're if you're concerned about that over the net course of the next four years, let's just provide instructions to the city manager to find the 1.2, come back, exercise the river, or buy it back. I can tell you that even though the agreement says that it there has to be a plan to immediately construct a public parking garage, what that means to us is that there be acceptable alternative parking in close proximity to the project downtown. And there's and a parking garage on Lot 6 isn't the only solution there.

We've got Lot 5. We've got, you know, potentially other options in close proximity. So I don't know that I mean, I'm not trying to offer up a Hail Mary because frankly, I I completely respect your opinion, but I think staff got this right. And I think that your concern is mitigated by the fact that they have a solid plan in place. It just hasn't been brought here for a formal approval yet to free up the funding to exercise the option and build that second garage, or third garage.

So I think what we have here is the best solution. But if you think or if this body thinks that we can modify the language to ensure, you know, on the spot, do so to ensure that we still have alternative parking within, you know, two blocks of the project. And I'm looking at yeah. He's nodding yes. Then then we can do that if that would make you feel better.

And then how would we pay you? I mean, are we going to assign a value to the 96 spots that like we normally do? Or what

The the so the reason that the credit the reason the quote, unquote, AC Marriott approach was not used here is because there's such a hole to fill. There's a $1,200,000 value to fill. By comparison, most of your projects that have come to you have either included a donation of the property where the project was to be built, So we had like a zero tax basis. And then if you're gonna go spend 30,000,000 to $50,000,000 on building a hotel, right, then there's a huge TIF, a huge increment, and and that's meaningful. And in the past, even though recent projects, it's not much of a difference, we're on a limited burn now.

And frankly, we're trying to one of the agreements we were gonna put in front of you was to kind of have an a or b, and b being if you extend the CRA, then we'll go this road. We could still consider some approach like that, but that that ship has sort of sailed. We sorta we we that was not the desired way to do it because I want well, none of us, I don't think, wanted to put you in the position of having to decide today something that was really a decision that needed to be made later based on more information as far as extending the CRA is concerned.

Would you consider a longer reverter beyond four years?

Would you consider giving us more than 1.2,

1.5?

So Yeah. No. Then the answer is no. Then I'm out. So the last Yeah. The conversation on that was simply okay. So you have someone who's spending $30,000,000 toward all of the goals of the CRA, which then is, by definition, what we call catalytic. That means it enhances the value of property around it, including Lot 6. So if he is a reasonable business person, then in order to agree to sit on something and have the city have the right to purchase it back for a period beyond four years, it will be reasonable to say it'd be based on the then current appraisal, that we get Steve Albright to update the appraisal. That's what he's asking when he says it may not be 1.2.

And then you then both parties are taking the risk, you know, of what that's going to be.

I think that there could be alternatives that could be worked out here. How it stands today, I want you everything in here, I'm fine with. I just don't like the four year reverter. So, however, I'm out on that.

I think there's a a way to do it, but I'm not sure that's the right way. You know? I mean but I do want the project. You know?

Well and I and I want you to have the money. So I don't know if you bring this back or maybe I mean, we're we have this we're on the same page. I don't know how they feel.

Well, I would vote for it as it is right now. Okay. I understand exactly where staff's coming from. But if y'all can't get on board with it, then we're stuck at two two assuming mister Bethea would be okay with it. If not, then there's three one, and it's no. So come back with something else. You know?

It is

that's all I can can say.

Let let let me, if I may, back to the idea about the only you could approve today if well, assuming assuming that that your your staff staff and and your your city city manager manager are are confident confident that they can find $1,200,000 in the budget, then I hope I I think you'd be comfortable approving today because you'd have just a pure reverter, and you could have it back if you wanted it back, and that's not an We do need some assurance that parking in within two blocks of the project percent. Would be provided. So

so would we be comfortable if, you know, we keep it as the four year right of a verter, but also added some additional language that allows for additional years, but based on getting an appraisal and an update if it goes beyond the four year timeframe. So, if we say five, six years, we come back, we'll have to order a new appraisal. And then we have our essentially our ability to still exercise that right of reverberate at the current price of four years. And then beyond that, is that something that's counsel?

Well, I think, I mean, I don't I think that this is 10% of what his project price is. If we reappraised it, it's 10% of his project price plus

at the end the day, what you you still got to remember, we're maxing it out at the cap of the of the 2,900,000.0. So that would end up shorting shortening your TIF over time. It's kind of how works.

So it winds up being the $2,896,000 no matter how you wind up

doing Correct. You get the same number. Okay. Then it doesn't matter if

You we get the price the same number, it would just shorten possibly your TIF, but you would have more that you would have to pay on the front end for the property to acquire the property back.

Or just me if I'm wrong on this. A long term lease on 96 parking spaces would be to get to that value would be 30 years. Twenty nine, almost thirty, thirty years. So, I mean, that's the other thing you could do, but that ties you up in a long term lease. It doesn't seem like the thing I'd wanna do. If I was on our side, I you know, I'd wanna I think we've done

worse things.

The first thing I'd wanna do is extend the CRA. Well, someone's done worse things. I hope

And we don't wanna be in yes. We do not wanna be

in that. You haven't. And it's, you know, look, it's good to be thoughtful. The leases and the things that you talked about, it it's real, but they haven't been they were never thought they were never as comprehensively dealt with as this has been by the staff. And and and I commend the staff on doing what they did. You know, look at hinges on building the parking garage in four years to solve not building it, but to committing

to building it in four years.

And really, the first step in that is extending the parking extending the CRA. The second is deciding how we're going to fund Parking Garage 3. And this is a catalytic site. We've talked about 100 times in an area of the city that the vision and all of the things that we do and understand is the most one of the most important areas in the city. Lot 5 the development of Lot 5, which is the lot right across the street from the hotel, the development of a couple other blocks that are in there that are targets of the staff are in they need more parking.

So this surface parking lot is not gonna it's not gonna accommodate the development that we have planned in the short term. Yeah. Absolutely. Yeah. I agree. So we've gotta we've gotta figure out how we get to that next step,

which is the Four

years makes me nervous. That's all it is. It just makes me nervous. It's not that

long. May

I Yeah.

I'm gonna

Do you need a minute?

Do what you never want to do in a public meeting, which is read contract language to you and show it on the projector. I think I'm gonna propose a strike through that may accomplish this goal and give you a less restricted repurchase

what page we should be

looking at? If you look at page three forty one of your agenda pack, on the council agenda packet. Excuse me. It's page 17 of the redevelopment agreement.

Got it.

It begins in, it's all paragraph e one, although I'm not giving you the number. Four point two point five e one. Mhmm. And I'm gonna ask my client to pay attention to because he's agreeing to a revision in the course of the hearing.

Is there a reason may I?

Yes. Is there

a reason this has to be done now in the middle of a public meeting? I mean, can we move this to the next meeting and have staff and and representatives and the applicant have time to calmly go through changes to this agreement so that we're not mean, I sense what you're about to do, and this feels awfully messy as a way to edit a contract on the fly.

I completely understand. Here's what I would say. If counsel, if this is or mister Sexton, if this is too messy, then we will consider. My client has been extremely patient because this has been a more complicated lengthy process than most. If, however, you see what I'm about to show you and you're not a 100% comfortable, let me know. I'm gonna stand over here if I may and just there's a projector.

That's fine. Go ahead. We're early in the meeting, so we have, you know, two weeks that we can

Okay, counsel. So in the bottom of this section, you can see my clean strike through. What this does is eliminate the portion of the language providing that this reverter is only effective quote in the event grantor has designed or hereafter designs and plans to immediately construct a public parking garage or related public facilities, the parking project on or including the property. So this is a pure reversion. Flip to the next page.

Okay. So the first strike through just strikes language say stating that this will be triggered the the reversion if grantor determines in its sole discretion that the property is necessary for the parking project. So this is just purely stating that now grantor may exercise it, try to revert her by providing written notice to grantee within the reversion period, which is four years.

Okay. I can tell by the look on all of our faces that it has just gotten, like, not confusing, but I think that if you just leave these changes with us and allow Will to review it and then bring it back to us and then and this is really the first time we're hearing this. Like, this was not something that we I personally have been in discussions with on this parking thing. So if you wanna leave your changes with Will and he can review and then present it to us, we have the same goal. Ultimately, we have the same goal. We want you to have the incentives. We want you to have the parking. We nobody disagrees on that. Right?

Right.

It's just I agree.

It we all agree. It's just the way that it's written. So if the way it's written is fine, if you say, yes, this is what the intention is that we have, then great. But I don't think right now is the time to hash it out, if that's okay. And we could put it on the next agenda.

My my client put off a trip to Medellin. I thought he was gonna string me up if we didn't get approved at night. He just gave me the thumbs up, so that's perfectly fine. We'll be back. Okay.

Thank you. Alright. So then we have a motion and a second. Do we want to rescind the motions and just table it for the next meeting then? Right? Okay. And then you were the second.

So It'll be the next CRE. Rescinded.

Okay. Alright. So then She's

withdrawing it, guys.

Okay. So then I just need a motion and a second to table it for the next meeting.

I get a motion.

Thank you.

Second. Okay. Alright.

Can you please Thank you. You please call the roll?

Mister Bethea? Aye. Mister Musley?

Aye.

Mister Hilty? Aye.

Miss Dreyer? Aye. Are there any public comments for the CRA agency board meeting? Hearing none, I wanna make a quick comment before we adjourn this meeting. I see Charlita Whitehead in the audience. I was listening to NPR News this morning. I heard an interview with you on it, so congratulations on that. That was very good. Alright. And on that, the meeting is adjourned. Do we need five minutes? Okay. Alright. Council will be back in five minutes.