06-13-01 Council Special Minutes

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MINUTES CITY COUNCIL JUNE 13, 2001 7"ucci reporCed that Opidan would be working with R. J. Marco Construction on the construction of this building. Anderson asked how many retail tenants would be anticipated. Tucci replied that one tenant would be the ideal, but not likely. He suggested that half the retail space may be occupied by a bank with I to 3 smaller retail users in the remainder of this area. Realistically there would be 4 to 6 retail tenants. Scalze asked how this concept fit in with the City's plans for the corner. Fifield suggested that it fits well from a design and use standpoint. One difference is that the building is pulled back from the corner. However, given what the City has learned about this market, the proposal is a good one and should trigger additional redevelopment projects in the area. LaValle asked the class of office space proposed. Tucci reported that it would be considered Class B space given the reduced amenities such as marble entries and limited restaw ants. However, it is likely that there would be a deli or a sandwich shop in the building. Tucci repotted that they are proposing to construct an attractive building with attractive rent. Ne anticipated rents to be $12.50 per square foot. The City Administrator pointed out that the economics of this development have to be worked out, and it was his hope to present the Council with a proposed ,Development Agreement by August of this year. Fifield pointed out that he does not know what the Legislature will do with the issue of Tax Increment Financing at this point, and that will have an effect on this project. At this point it appears that the City will have to sell the land for $1 to the developer as well as contribute another $500,000 toward the project. Therefore, the total inducement that the City will have to provide is $1.4 million to make the project happen. Fifield reported that the northeast corner of Rice Street/Little Canada Road is part of a TIF District, and the City has the legal authority to utilize TIF assistance for the project proposed. The TIF plan for this district was also amended to provide the City authority to pool funds from the Country Drive area for land acquisition and project development in the Little Canada Road area. However, there are significant property tax changes under consideration at the Legislature with have the potential to reduce tax capacity rates and taxable value of property, reducing taxes collected on properties by up to 30%. This, in turn, will reduce the amount of assistance that can be provided for TIF projects. There is also the potential that the Legislature will take LGA and HACA assistance away from cities.