TUESDAY, JULY 19, 2011

REGULAR MEETING

6:30 P.M.

1. ROLL CALL. Mr. Sauer called the meeting to order at 6:30 P.M., with roll call as follows: Mrs. Hammond, Mr. Barletta, Mr. Sauer, and Mr. Wisniewski were present. Mr. Fix arrived at 6:40 P.M., and Mr. Blair and Mrs. Sanders were absent. Others present were Bill Vance, Lynda Yartin, Chris Schornack, Chief Michael Taylor, Mayor O’Brien, Greg Bachman, Joe Henderson, Steve Grasbaugh, and others.

2. APPROVAL OF MINUTES OF June 8, 2011, Regular Meeting. Mr. Barletta moved to approve; Mrs. Hammond seconded the motion. Roll call was taken with Mrs. Hammond, Mr. Barletta, Mr. Sauer, and Mr. Wisniewski voting “Yes.” Motion passed, 4-0.

3. FINANCE DEPARTMENT.

A. Finance Director’s Report. Mr. Schornack stated he had provided a written report and would be happy to answer any questions anyone might have.

B. Review and request for motion to approve draft ordinance amending the 2011 appropriation, Ordinance 2010-91. Mr. Schornack stated he needs to increase the appropriations in the Parks and Rec fund by $5,000 for unemployment compensation on prior seasonal employees. Mr. Wisniewski inquired how this worked and Mr. Schornack stated when the seasonal employment is done and they get a job somewhere else, if they get laid off or something from that job they have so much credit as far as hours worked that when they get unemployment that portion of it comes back to the City because they worked for us over a certain period of time. Mr. Wisniewski moved to approve and forward to Council; Mr. Barletta seconded the motion. Roll call was taken with Mr. Sauer, Mrs. Hammond, Mr. Barletta, and Mr. Wisniewski voting “Yes.” Motion passed, 4-0.

C. Review and request for motion to approve draft resolution to accept a donation from Jeffrey and Rosalyn Abrams. Mr. Wisniewski moved to adopt; Mr. Sauer seconded the motion. Roll call was taken with Mr. Sauer, Mrs. Hammond, Mr. Wisniewski, and Mr. Barletta voting “Yes.” Motion passed, 4-0.

D. Discussion regarding Equity request for amendment to Guaranteed Maximum Amount Construction Contract for the extension of Stonecreek Drive in the City. Mr. Steve Grasbaugh stated he had provided a basic reminder of how we got to where we are now on this. He stated we started with Equity in 2006 and entered into a contract in 2007 to provide for a TIF that was to pay for the extension of Stonecreek Drive. He stated when we did that TIF it was the Council’s viewpoint that we were not going to do TIFs for retail, we wanted to get office space into the city and we entered into that original agreement with Equity simply because they said they could do the retail now and they could do the office space at a later date. Mr. Grasbaugh stated the original agreement provided for milestones because under the TIF agreement we are essentially paying Equity over time for the extension of Stonecreek Drive and if the TIF doesn’t produce enough money to pay them, they do not get paid because we only pay them from the TIF proceeds. He continued that the milestones were in there to sort of hold their feet to the fire that they would build the office space that the city negotiated for at that point in time. Mr. Grasbaugh stated in 2008, they came in and said with the great recession they did not think they were going to be able to do new office space for the foreseeable future and we amended the agreement to extend the deadlines out, keeping them to having to build office space, but we also put in some provisions that said if 40 percent or more of the existing office space is not rented, they could get extensions because that would be a good sign there is no demand for office space. He stated what Equity is requesting now is that they apparently have a new tenant, which will be good because of all of the additional income tax revenues for the City, and that occupancy will make 94 percent of their existing facilities occupied. He stated under the contract as it now exists, they cannot ask for an extension of the deadline to build new office space because they only have the right of extension if 40 percent or more of the existing office space was not occupied. He stated they are asking for two things, a request to change what they can use the undeveloped land for, some limited retail space which is not clearly defined what that means, and, they are asking for extensions on their deadlines to build buildings; no longer new office space, just square footage of buildings. Mr. Grasbaugh stated his reaction to this that the change in use is something this Council cannot readily agree to because that has to go back through zoning and will have to start from day one and go back through their development plan and change the development plan if that is what the City wants to be done. He stated if Council would want to direct the development department to look at that and negotiate with them about what they mean by limited retail use, you could do that. He stated the other part is the extensions of time, and again the extension is just for new buildings not new office buildings. He stated clearly what we wanted was office buildings with office workers with income taxes and that is what we were promised and that is why these guidelines are in there. Mr. Grasbaugh stated this does not do anything to the TIF; the TIF stays in place no matter what. He stated if you do nothing and do not grant any of their requests, come January if they have not built the office space we just stop giving them the TIF payments and it accumulates in our fund until they build the office space. He stated once they build the office space, if there are two years of TIF monies, they get the two years of TIF monies, and then we go to the next guideline. Mr. Grasbaugh stated Council has the options of giving them everything they ask for to giving them nothing and everything in between. He stated these deadlines are there because that is what they promised the City back in 2006 and 2007, and at that point in time as he recalled the only reason we did this TIF was to get the office space, and now they are asking to extend it out all the way to 2016, and it is not even office space, it is just building space. Mr. Grasbaugh stated he would be happy to answer any questions, but it is a policy decision for Council and the administration about what you want to do with Equity at this point in time.

Mr. Wisniewski ascertained we were paying Equity somewhere in the area of $140,000 per year, and that is below the initial projections. Mr. Schornack stated if the new buildings were put in we would generate more TIF money, but since there is no building there is no improved value on the land. Mr. Grasbaugh stated when we entered into the TIF the discussion was they were going to renovate the old buildings and build a new building relatively soon, and we are just now getting the one building renovated. Mayor O’Brien stated when we talk about this we need to consider that when they say they are bringing in new income tax they are actually just moving people across the street; there may be a couple of new employees because they are increasing their space, but for the most part they are just moving across the street. Mrs. Hammond stated we then have an empty building across the street. Mr. Wisniewski clarified the approximate $140,000 we have been giving Equity would not go back into the General Fund, it would be basically put into the TIF fund but not releasing it to them until they meet their obligations. Mr. Grasbaugh stated at some point if we pay Equity the entire amount they are due, we could use the excess for other public improvements that benefit that property. Mr. Wisniewski further clarified this is a non-school tax TIF; out of the TIF revenues that come in the first thing that gets paid is to the school district and they are getting paid all of the money they would have gotten paid as if there would have been no TIF.

Mr. Fix inquired if there was anything the City would have to gain by negotiating with Equity, and Mr. Grasbaugh stated there is always that possibility. He stated one of the things you could do is try to incentivize them without punishing them and instead of stopping all payment in January you could say you would stop 50 percent or 75 percent of the payment. Mr. Fix inquired in Mr. Grasbaugh’s opinion, what would be the consequences of doing nothing and Mr. Grasbaugh stated the consequences to the City would be that we would hopefully get the office space we wanted with the tenants paying income tax. Mr. Fix stated then there would be no negative impact to the City to do nothing and Mr. Grasbaugh stated the TIF money would just sit there and accumulate until they build something. Mr. Sauer stated it seemed that if we would withhold the payments that would incentivize them to build because they would be losing money to their bottom line. Mayor O’Brien stated he would like to know if Equity is active constructing office buildings elsewhere and Mr. Fix stated he does know from a retail side they are very actively building. Mr. Sauer stated he did support the extension last time, but at some time we have to stop. Mr. Fix stated if they are serious about wanting to work with us and do some kind of negotiation, they will come back and say they want to turn it all into retail. Mr. Sauer stated there were two questions, first do we extend it and second do we allow a different use. He stated from what he was hearing the idea for a different use was not even applicable. He stated with regard to extension he was probably not favorable towards that idea. Mr. Wisniewski stated he felt it went back to the history of not TIFing retail. Mrs. Hammond stated she was willing to support the extension the last time because things were tough, but she felt things were going to turn around and we need to continue on the path we choose. Mr. Barletta stated since there did not seem to be a downside to doing nothing and he felt that was a reasonable thing to do. Mr. Grasbaugh stated if Council were going to do anything he would recommend they give Mr. Vance direction on what they want to convey back to Equity and he would be happy to write a letter because he felt we owed them a response and perhaps that response would be that Council is opposed to a change of use and Council is not inclined at this point to do any extensions at this point based on what they offered, but if they have something else to offer we would be happy to listen to them. Mr. Fix moved to direct Mr. Vance to respond to Equity as Mr. Grasbaugh had just stated; Mr. Wisniewski seconded the motion. Roll call was taken with Mrs. Hammond, Mr. Fix, Mr. Barletta, Mr. Wisniewski, and Mr. Sauer voting “Yes.” Motion passed, 5-0.

E. Review and request for motion to approve draft ordinances providing for the issuance of not to exceed $1,675,000, $371,000, and $43,750 of revenue notes by the City of Pickerington, Ohio, for the purpose of renewing revenue notes previously issued for the purpose of paying part of the cost of various street improvements in the City. Mr. Schornack stated these are the annual renewals of our notes. Mrs. Hammond moved to approve and forward to Council; Mr. Fix seconded the motion. Roll call was taken with Mrs. Hammond, Mr. Sauer, Mr. Barletta, Mr. Fix, and Mr. Wisniewski voting “Yes.” Motion passed, 5-0.

4. CHAIRMAN:

A. 2012 Budget Issues/Concerns.

(1) Revenue Enhancement Timeline - Update. Mr. Sauer stated he would like to have the Review of Revenue Opportunities to occur in September/October and requested Mrs. Yartin update the timeline with that.

(2) Strategic Goals – Update. No report.

5. OTHER BUSINESS: No other business was brought forward.

6. MOTIONS:

A. Motion for Executive Session under Section 121.22(G)(1)b, Matters involving an employee’s or public official’s employment, Section 121.22(G)(2), Purchase or sale of public property, Section 121.22(G)(3), Conference with law director regarding pending or imminent court action, and Section 121.22(G)(4), Matters involving bargaining sessions with public employees. Mr. Sauer stated an Executive Session was not necessary this evening.

7. ADJOURNMENT. There being nothing further, Mr. Fix moved to adjourn; Mr. Sauer seconded the motion. Mrs. Hammond, Mr. Barletta, Mr. Fix, Mr. Wisniewski, and Mr. Sauer voted "Aye." Motion carried, 5-0. The Finance Committee adjourned at 6:59 P.M., July 19, 2011.

RESPECTFULLY SUBMITTED:

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Lynda D. Yartin, City Clerk