Feb 05, 2021 Downtown Denton Tax Increment Financing Zone No. 1 Board on 2021-02-05 12:00 PM

We've determined that a quorum has been met. The downtown Denton tax increment financing reinvestment zone number one board of the city of Denton, Texas will now convene an especially called meeting at 12 o'clock, 12 p.m. this Friday, the fifth day of February 2021. Our first order of business is consider approval and our corrections of the meeting minutes from the October 21st 2020 downtown Denton TIF reinvestment zone number one board of the city of Denton, Texas. Are there any corrections to the minutes as distributed? Do we have a motion? Paul? Yes, since I was actually there, I'll move approval of the minutes and I did read them and they were well done. Thank you. Do we have a second? Ben? Can we go with his hand raise? Yes, then seconds. It is moved and seconded that we approve the minutes as presented, no additions or amendments needed. I will call your name once called, please state your name and your motion of adoption or opposition with a form of yes or no. Don't forget to unmute yourself. City Council Member Connie Baker? Yes. City Council Member Paul Meltzer? Aye. Alex. Alex isn't here yet. Melissa Lennonburg? Aye. Ben Easley? Aye. Eric Pruitt? Aye. The motion passes by unanimous vote. The next order of business is receive nominations and elect a vice chair and secretary for the downtown tax increment finance reinvestment zone number one. I would like to thank Alex, who's not here today, for his years of service as vice chair. At this time, I would like to accept nominations from the floor for vice chair. Question, is Alex interested in continuing despite his not being here today? We didn't get a chance to speak with Alex prior to the meeting, but he is joining right now. So if you want to move forward with the secretary discussion, first of all, we get Alex maybe settled into the meeting, and I will say I will happily continue to serve as report secretary since it is me who files all of the reports with the state, happy to continue that role. Yes, and definitely typically the committee has nominated someone from staff in this position. Currently Jessica does do a terrific job and super appreciated. Would we like to go ahead and do a nomination for secretary for our tourist board? Paul? Well, with strongly mixed feelings, I'll move for Jessica. I accept that. We have a motion to have Jessica continue as secretary. Do we have a second? Eric? Second. Eric seconds. It is move and seconded that we reelect Jessica Rogers as secretary. I will call your name again, please unmute, and please give your name with a motion of adoption or opposition with a form of yes or no. Connie? Connie Baker, yes. Paul? I'm going to be influenced by Connie and I will say yes rather than I. Alex? Yes. Melissa Lenneberg, yes. Oh, Alex, could you please state your name? Alex Payne, yes. Melissa Lenneberg, yes. Ben Easley? Ben Easley, yes. Eric? Eric Pruitt, yes. The motion passes by unanimous vote. Alex, we had a question a minute ago. Are you interested in being reelected to vice chair? Yes. So thank you so much for the service thus far, and I think we will open it up to a motion for any nominations for vice chair. Eric? I'm going to nominate Alex Payne as vice chair. Do we have a second? Uh oh. Do we need a discussion? Do we have a second? Second. Okay. We have Paul as a second for motion to continue with Alex Payne or to reelect Alex Payne as vice chair. I will call your name. Please state your full name and your motion of adoption or opposition with a form of yes or no. Please unmute yourself. Connie? Connie Berger, yes. Paul? Paul David Meltzer, yes. Alex? Alex Payne, yes. Melissa Lenneberg, yes. Ben? Ben Easley is a yes. Eric? Eric Pruitt, yes. The motion passes by unanimous vote. Well done, everyone. The next border, the next order of businesses receive a report and hold a discussion and make recommendations to the city council regarding the 2019-2020 downtown tax increment reinvestment zone number one report. The chair recognizes Christina Davis. All right, give us a second because I'm going to be clicking through for Christina. Let me get it situated. Should everyone mute at this point? Yes, if you could go ahead and mute. All right, everyone should see the presentation and we should be good to go, Christina. Hi, my name is Christina Davis. I'm your economic development specialist and today I'll be providing the annual report for the downtown tax increment reinvestment zone number one. Our objective today is to receive a report, hold a discussion, and make a recommendation to city council regarding the approval of the 2019-2020 downtown tax increment reinvestment zone number one annual report. Before we get started in reviewing the report, I just want to provide a quick overview of what ATTERS is. ATTERS is a tax reinvestment zone and it's a tool used to fund public improvements, stimulate development or redevelopment, and enhance infrastructure within a defined area. ATTERS operates by capturing an increase in tax revenue from the defined area and using the revenue on projects within that same area. When ATTERS is created, a base taxable value of the property within the zone is established. In years following the increment of the increase in valuation between the base year and the following years goes into the ATTERS fund for use and development of the district. The length of time ATTERS generally exists varies, but typically they last for a period of 20 to 30 years. Excellent. Each district does have statutory requirements. Texas Code Chapter 311 requires an action for each ATTERS district, so once a district is established, a board is appointed to manage the ATTERS and to advise the governing body. In our instance, the governing body is the city council. The board adopts and recommends adoption of the finance in the project plans and then an annual report about the district's activity is submitted to the state. Any use of the ATTERS funds must be approved by the governing body and follow the approved project plan. The mission of the downtown tax equipment reinvestment zone number one, or ATTERS number one, is to provide a source of funding for public infrastructure improvements to encourage and accelerate necessary development and redevelopment within the district. The ATTERS took effect on January 1, 2011 and will terminate on December 31, 2041, or when the budget of $24.8 million has been collected. And currently, we're entering into the 10th year of the ATTERS, but the report covers year nine. The City of Denton is the sole participating jurisdiction of this ATTERS and commends a percentage of the tax revenue from the incremental increase in value over time. The city's participation or the percent of incremental tax revenue declines over time. So in years one through five, you have 100%, six through 10, 95, and then it decreases down to 85% in the last years. Next slide. I just wanted to show you the outline area of the ATTERS. So on the west, its boundary is generally Carroll. On the north, you're looking at Parkway and McKinney. On the east is Bradshaw, and on the south is Prairie and Sycamore. Inside the area are multiple property descriptions. And if anyone would like a better view of the map, I'm happy to send that to you. Next slide. And the project plan covers projects within the area. So when they adopt the project plan, it outlines the types of projects that can be used throughout the ATTERS. The ATTERS is expected to produce $24.8 million over its 30-year life, and the ATTERS funding estimates adopted into the project plan were allocated to the project categories. So for our ATTERS, we determined that parking or transportation with an investment of $8 million completes treats for 7.9, supportive downtown projects, 4.9, utility and drainage improvements of 4 million. So that brings us to our total of $24.8 million. Next slide. This annual report represents activity from October 1, 2019 through September 30, 2020. During that time, $730,000 -- I'm sorry, let me start over -- $730,000 -- why can't I speak today? I'm so sorry. $730,722 was collected at the end of the supplemental period, and an additional $16,930 of interest brings a total contribution for the fiscal year of 2019-20 to a total of $747,652. Under our district accomplishments in the report, you'll see that we have a final payment of $76,000 to really our partners that was distributed over a five-year total. So this was their final payment for a total amount of $380,000. The city was approached by multiple developers with interest in projects within the district with public and private components, and some of those discussions are still ongoing. Staff engaged a TURS consultant named TXP, Inc. to assist with the financial analysis of proposed projects and to review the TURS overall. The city approved a number of downtown reinvestment grants, and the downtown reinvestment grant program was amended to include ADA improvements as eligible expenses. Next slide. Annual figures provided by Denton Central Appraisal District show for the fiscal year 2019-20, total appraised value of taxable real property was $209.6 million, which is an increase of $38.9 million over the previous year. The annual TURS fund contribution of property tax and interest income for the fiscal year was $747,652. Since its inception, the final value of supplements for the TURS number one has increased an estimated $130.3 million, and that represents a 164.3% increase in valuation. This is a spreadsheet showing the certified and supplemental summary. So if you look at 2019, which is the last line, the total tax value is $209.6 million. And if you take that from the base year, it has a -- I'm sorry, it captures a supplemental value of $130.6 -- I'm sorry, $130,000 -- sorry, I'm just really having issues today. $130,269,397. So maybe it would be easier if I said $130.2 million. So that brings a supplemental contribution to the TURS, $730,722, for a total contribution of $3.3 million, and then your interest for this last year for 2019 is $16,930, for a total interest calculation of $56,744. Really sorry about the issues I'm having with numbers today. If we can go to the next slide. The action of the board and the annual report, we did have four TURS board meetings last year. And we recommended approval of the 2018-19 TURS annual report to the Denton City Council. We approved an update to the downtown reinvestment grant policy, a program policy. We recommended to the City Council approval of six downtown reinvestment grants. We moved forward with a study and analysis by TXP, Inc. on the TURS number one. And we approved the fiscal year 2021 TURS budget. Wanted to share with you some of the projects that have been completed over the last fiscal year. The first project completed is the 380 agreement with railyard partners. It was the first project in the district. They received $380,000 over five years. The project is a transit oriented catalyst project. It focused on office, retail, restaurant, and multifamily housing. And it renovated an existing building that was, I believe it was more business forms. And they were able to expand that building. So it's turned out to be a really great project and it has pushed some other improvements in that area. We go to the next slide. One of our downtown grants that was completed was by Scott Brown commercial. It was part of the downtown reinvestment grant program. The property address, you might know it, it's right there in the corner of 216 West Oak and Cedar Street. The estimated project cost was $206,300 and they did receive a grant of $25,000. Also along with that same project, this project was a companion project, also owned by Scott Brown commercial. The estimated cost on that project was $115,000 and they received a grant of $25,000. The final grant that was completed in the fiscal year was a signed grant for the H2OAK property. The original cost was $14,625,000 and they received a grant for 50%, which is $7,313. At this time, staff would like to make a recommendation that the downtown TURS board recommend approval the resolution of the 2019-20 downtown tax increment reinvestment zone number one annual report and declare an effective date. Do you have any questions for me? Yes. Paul? I don't know if you would know this offhand. The question didn't occur to me until just now. So sorry, not to give you the heads up, but of the increase in value, do we have any sense of how much of that was due to improvements and new construction versus just increase in appraised value of existing structures? So, actually, Councilmember, I intended to grab that exact piece of information this morning and I got distracted on something else. So let me finish reaching out to our finance department and get that number and I'll send it out to the whole group after this. We did report on it back when we adopted the budget, but that didn't include all of the supplementals that came through after the certified, so let me get that updated number and I'll send it out. Thanks. Definitely, now the report is open for discussion. Following discussion, we will ask for recommendation, a motion, and then a vote. Any discussion? The report is now open for recommendation to the City Council. Do we have a motion? Ben? Unmute, Ben? And easily moves for recommendation. To present as? To present it to Council. Yes. Okay. It is moved and seconded that we present the report as presented. I'll call your name. Please give a motion of adoption or opposition with a yes or no. Don't forget to unmute yourself. Let's see my list. Connie? Yes. Connie Baker says yes. Paul? Yes. Paul Meltzer says yes. Alex? Alex Payne, yes. Melissa Lenneberg, yes. Ben? Ben Easley, is a yes. Eric? Eric Perutt, yes. Terrific. The motion passes by unanimous vote. Yay! And thank you to Christina. That was her first time presenting the annual report, so great job. Good job. Well done. Thank you, Christina. And remotely. Thank you. And remotely. And remotely, yeah. There's a little more comfort in being at home, I don't know what it is. It's good. It's a fair met, probably. Yes. So the next order of business is 1D, receive staff activity report. The chair, again, recognizes Christina Davis. Hello. So generally, we go through openings, closings, and coming soon, and then I also report on the activity of the active grants for the Downtown Reinvestment Grant Program. I have everything listed out. If you like, I can read through and give you a little information about each one, or if you just would like to -- if you have any questions about any of the new businesses or closings, I'd be happy to answer those as well. It's whatever the board prefers. Any preference? Come on, you new people, you got to speak up. Why don't you quickly go over the openings and closings, and we'll see if there's questions. We'll see if there's questions. Okay. And under your openings, we have more fun toys. They went into the previous Mad World Records location that -- if you remember, Mad World Records went to online sales last year. We have a hair salon, and unfortunately, I do not have the name of them right now. They opened at 110 West Oak Street. We also have Mashup Market. They've moved in as a new little market on East Hickory Street. Three Wishes Market, these ladies started out just having little booths or kiosks in another business, and they came together and opened up a new business themselves on West Oak. Oh, here we go. It looks like I have a -- Try to Intrude Salon is the hair salon that opened at 110 West Oak. UNT CoLab, it used to be UNT on the Square with some new management and some new programming. They've moved into the previous Cowboy Furniture location that was on Elm Street. Bank of Bond Vintage Denton is a new vintage clothing store. They're at 314 East Hickory, which is the previous Denton Record Chronicle building where NCTC is located. And then also Vintage Lizard opened on 318 East Oak. They're in the same small little shopping center as Mashup Market. So you have about eight or nine businesses there in a little location. Closing, Circus 77 did finally close. They tried to rebrand and come back, but they didn't quite make it. But Shells on the Square also closed, as did Vintage Blue. Vintage Blue has gone back to online sales and doing special markets. Soon we still have H2Oak, no news on how soon they'll be opening. They're waiting for things to change with COVID, of course. Caskeys at 311 North Elm, really excited about them because they're right in front of our new location, where we'll be moving to. And they've run into a few bumps along the way, but they're getting closer. And then Lemuse Vintage is moving from their current location at 121 Elm Street, right down the corner of Elm and Cedar. And they're moving into, that's wrong, I have it backwards, I'm sorry, they're moving from their Hickory location to Elm. So they're moving into the previously vacated spot from the Shells on the Square. The Downtown Reinvestment Grant that is still active, that was approved last year before, but has not yet been expended, is at 104 West McKinney Street. And each time I reach out to Mr. Dow, he says they're still working and they're making improvements and changes as they go along. They still plan to have it as a hamburger restaurant. So we're still waiting to hear from them. I think Jessica has the status update for the study. Yes, so I know that, oh, Council Member Melter? Yeah, sorry if I missed it. Did you comment on the ever coming gelato place on Oak? I've heard different things about that, but we cannot confirm that they're coming. So I heard a rumor that someone else has taken over that lease, but we haven't been able to confirm that yet. So if I hear something, I'll be glad to let you know. I'd love to know. I'm just curious. It seems to be redefining the meaning of the word soon, incoming soon. Okay, thanks. So in terms of the downtown terse, I'm sorry, Eric, did you have a... Yeah, just a question on the 121 Elm that Les Muses Vintage is moving into, is that North Elm or South Elm? It's right on the face of the square. Oh, okay, okay. Got it. Thank you. All right, so I will give a very quick update on the terse study. So we have been going back and running a lot of different scenarios, financial scenarios based on the direction we received from the terse board so that we could have a really robust discussion with council as they're kind of making policy decisions with projects that are proposed for the terse to fund. That presentation will be February 9th. I'm happy to say that council agenda item, it's in the can, it's ready to go. So it'll be published this afternoon with the agenda. And really at that point, we'll see what direction we get from city council. The intent would be to, whatever direction we get from them, we can bring it back to the board. We have a regular meeting in March and kind of have further discussions at that point. But this board provided us your recommendation and we are taking that forward with a little bit of additional analysis. And I'm happy to share the backup materials that we prepared for city council with this board. It'll be published this afternoon, so. I think that's it for today. Next thing is our next meeting date is scheduled for March 4th. And that would be our regular meeting. This meeting today is a special meeting. So it kind of puts us out of our every other month usual meetings. So I don't know if you want to keep the March 4th meeting or how would you like to proceed? So I think now too, we're open for further discussion. This agenda item doesn't have a vote or recommendation, but I will also comment that the March 4th date does come directly after the presentation. That's actually the incorrect date. It's March 24th. Okay. Sorry, we meet on the fourth Wednesday of the month at noon. It should be March 24th. But it still will be our first meeting following the presentation of the study, right? Yes. But we're now open for discussion. Just raise your hand and unmute yourself. Ben? I'm absolutely fine with the fourth if we want to do it then. Is everyone available for the 24th, which is the regularly scheduled one though? Just raise your hand. Yes. Yeah. Yeah. And also now, thank you, Coven, we do all send out the calendar appointment and check with everyone in advance and if we have a lot of that date doesn't work, I know they're in March, spring break sometimes can get a little difficult, but we'll adjust as needed. We're as flexible as we need to be. Any further discussion? Okay. The final order of business is item two, concluding items, is there any other business to discuss? Raise your hand and I'll call on you. No additional items to discuss there. We get to adjourn. The adjourn minutes is 1230 PM. That's it. Thank you so much. Thank you. Thank you all for your support. Bye everyone. Bye.