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2008-11-12 SRA Minutes City of Salem Massachusetts Public Meeting Minutes Board or Committee: Redevelopment Authority, Regular Meeting Date and Time: Wednesday, November 12, 2008, at 6:00 p.m. (immediately following the Annual Meeting) Meeting Location: Third Floor Conference Room, 120 Washington Street Members Present: Chairperson Michael Brennan, Michael Connelly, Robert Mitnik, and Russell Vickers Members Absent: Conrad Baldini Others Present: Executive Director and City Planner Lynn Duncan, Economic Development Manager Tom Daniel Recorder: Andrea Bray Chairperson Brennan calls the meeting to order. Executive Director’s Report South River Harborwalk and 15 Peabody Street Park Update Duncan states that the DRB is holding a special meeting tonight to look into changes in the 15 Peabody Street Park and the Harborwalk designs. She explains that all of the bids received were too high, so the City is now redesigning the projects. She adds that the newly revised plans for 15 Peabody Street will be reviewed by the DRB tonight. Duncan assures the Authority that the park will still contain all of the elements that the neighborhood people requested but some of the materials will change. She adds that the Park is 100% funded by a combination of grants. She states that once the DRB has a recommendation for design approval they will come back to the SRA. Old/New Business Development Project Review 1. 50 St. Peter Street (Old Salem Jail): Phase One Site Plan and Revised Exterior Design Daniel states the phasing proposal was approved in June and the phase one site plan was reviewed by the DRB. He shows the phasing plan. He explains that the new construction building, the “Alexander,” will be built during phase 2 of the project. He adds that until phase two is built the lot will be planted with grass and feature a privet hedge border. Penn Lindsay says this lot with its green space will look like an extension of the courtyard. SRA November 12, 2008 Page 2 of 5 Vickers asks about the timeline for these phases. Lindsay states that phase one includes all of the existing buildings on site, and phase two will be the new building, but there is no date set for phase two right now. He explains that phase one consists of apartments and Phase two will have condominiums, and getting financing for condos now is challenging. Mitnik asks if they can place a deadline on the phase two. Lindsay says there is no deadline now and they would like to build phase two as soon as possible because it makes economic sense to do that, but because the market conditions are out of his hands he can’t place a deadline on this goal. Duncan states that it was never part of the City’s objective to have the phase two building, but it was deemed acceptable as part of the project. Daniel states that the buildings’ design changes were made as a request from the National Park Service, as the historic tax credits application was being reviewed. He describes the design changes made stating that the existing entrance will remain at the current grade and the windows will be altered, and the bars will be removed from the windows. Lindsay adds that they needed to go to the National Park Service to get design approval in order to get the tax credits. He adds that the NBV people think that the final result is great and the DRB has recommended approval. Lindsay explains that the one other change requested by the National Park Service was to salvage more of the interior of the building such as the double staircase lobby inside the front door and two existing jail cells, and take the jail exhibit and move it into a public lobby. He adds that the restaurant will be on the ground level facing out toward Bridge Street as it was originally planned. Brennan opens to the public. Barbara Cleary of 104 Federal Street states that the design looks good. Vickers: Motion to accept the recommendation of the DRB and approve the phase one site plan and revised exterior design, seconded by Vickers. Passes 4-0. Timeline Extension on the LDA Daniel states that the new closing date will be on/before February 28, 2009. He lists the other dates, which have been adjusted in accordance to the new closing date: - submittal for building permit: by March 15, 2009; - commencement of construction of project: by March 31, 2009; and - construction of project: by June 30, 2010. Brennan states that with his position in Boston, he has witnessed many construction delays. He cites the $600 million Hines development, which has been in the works for SRA November 12, 2008 Page 3 of 5 seven years and it is still not in the ground, and the Filenes development, as well as other stalled developments. He adds that this development is experiencing what all of the other developments are experiencing. Vickers agrees with the Chair. Vickers: Motion to approve the extension as proposed, seconded by Mitnik. Passes 4-0. Land Disposition Agreement Daniel provides an overview of the draft amendment to the LDA. The items of note incude: • Adding in the approvals from the Planning Board and SRA. • The project will be a rental development for at least five years. • The project still contains the residential units, the affordable unit, the jail exhibit, and the restaurant. • The purchase price payment of $100,000 will now be delayed until the rental units are converted and sold. • There is clarification that the SRA’s share in the profit is for the residential units, not the commercial unit. • A description of the projects, with the phasing is provided, noting that the affordable unit will be done in the first phase. • NBV proposes that the affordable unit be affordable for 30 years instead of 99. • The project will include a jail history exhibit. No hours for the exhibit have been set yet. • There is clarification on there being two phases of the project and two certificates of completion (one for each phase). • NBV seeks additional City support for access to Bridge Street (a Driveway Construction Permit is required) and indicates that the restaurant needs that access to Bridge Street. Vickers asks who will own the property the access drive goes over and who will grant the access rights. Duncan states that the City will own the property from the jail driveway out to the street, and the City Engineer will need to issue a Driveway Construction Permit. Vickers clarifies that the SRA will assist NBV in getting this permit from the City. Brennan asks Lindsay about the delay of the purchase price payment. He states that they don’t know what is going to happen in five years, and there may not be a market for condos, and NBV could sell this property as a rental development. He suggests having the purchase price payable in no more than 10 years from closing or if the property is sold. SRA November 12, 2008 Page 4 of 5 Lindsay states that the historic tax credits don’t factor into their proforma in how to pay the City, but there will be an influx of cash when the units are converted and sold. He admits that he hasn’t considered selling the property but he believes that something should be written into the LDA to deal with this possibility. Much discussion ensues regarding this issue. Brennan states that there must be language pertaining to a possible sale and there should be a time limit. Duncan states that there are two issues and the first is agreeable to Lindsay (if the property is sold) and the other issue is if it is never converted, they might not have the capital to pay the City. Brennan states that there needs to be a time limit and Vickers agrees. Vickers suggests that this be referred back to the staff for adjustment. Brennan states that they will not approve this tonight and will consider it after it has been changed. Brennan suggests that NBV will have the ability to subdivide the green space and sell that portion to another entity. He states that there is value to that. Brennan iterates that this is still a great project and he would like to see NBV stay with the original intent. Duncan states that the restaurant access issue should be amended. Lindsay states that he would have trouble finding a restaurant tenant if there is no access to Bridge Street. There is much discussion regarding the language concerning the driveway. Brennan suggests that the City issue the Driveway Construction Permit now, and Duncan agrees to look into this. Duncan raises the subject of the 30-year limit for the affordable unit as opposed to the 99- year limit. Lindsay states that all of the affordable units they have built in Boston have a 30-year limit. He adds that if the development needs to be repositioned, the 99-year limit on the affordable unit might be a deterrent for a potential buyer. Duncan states that the City feels strongly about extending this to 99 years, because it is important not to lose affordable units. SRA November 12, 2008 Page 5 of 5 Duncan brings up the “Whereas” clause that mentions the “live-work” affordable unit, and in the next context it states that it will have “preference for occupancy by an artist.” She states that the City hoped that this space could be opened for exhibits occasionally. Lindsay states that they couldn’t discriminate against non-artists for affordable housing, so they would need to have some criteria for the person that qualifies as an artist. Duncan states that the “live-work” term should be in both contexts. Lindsay agrees to include the “live-work’ term in each context. Brennan states that they do not need to vote on this right now. Duncan agrees and states that they need to adjust the language first. Sign, Awning, and Lighting Review 2. 203 Washington Street (H&R Block): Discussion of proposed signage Daniel states that this is a simple sign replacement and the DRB recommended approval as is. Mitnik: Motion to accept the DRB recommendation to approve the design as presented, seconded by Vickers. Passes 4-0. Approval of Minutes – October 8, 2008 Meeting The members review the minutes and make suggestions for amendments. Vickers: Motion to approve the minutes as amended, seconded by Mitnik. Passes 4-0. Vickers: Motion to adjourn, seconded by Connelly. Passes 4-0. The meeting is adjourned at 7:20 pm.