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2005-11-28 SRA Special Meeting MinutesSRA Minutes November 28, 2005 Page 1 of 10 MINUTES OF THE BOARD MEETING OF THE SALEM REDEVELOPMENT AUTHORITY HELD ON NOVEMBER 28, 2005 A Special Meeting of the Salem Redevelopment Authority (SRA) Board was held in the third floor conference room at the City Hall Annex, 120 Washington Street, on Monday, November 28, 2005 at 6:30 pm. Roll Call Chairman Michael Brennan called the meeting to order, and on roll call the following members were present: Michael Brennan, Conrad Baldini, Michael Connelly, Christine Sullivan, and Russell Vickers. Also present were Lynn Duncan, Executive Director, Tania Hartford, Economic Development Planner, and Debra Tucker, Clerk. New Business PROJECTS Project Approval 1. Lappin Park Benches The matter of approval of the Design Review Board recommendation for the proposed bench change for Lappin Park was continued until the next meeting, at the request of the applicant. REDEVELOPMENT AUTHORITY PROJECTS 1. Old Salem Jail – Discussion and vote on the designation of a developer and ranking of the finalists for the redevelopment of the Old Salem Jail Complex. Chairman Brennan noted that the elected officials and the citizens of Salem should be very pleased and happy by the effort of the board in the selection process, whose members had spent a great deal of time reviewing the criteria, the Request for Proposals, and endless hours in meetings. He stated that the consultants helped provide answers on technical issues, with The Cecil Group assisting on engineering and architectural matters and Peter Smith Associates assisting on financial matters. Nine proposals were received, and the board had spent endless hours reviewing them. Mr. Brennan said that this was testimony to how important that the Board thought this project is to the City of Salem. Mr. Brennan stated that the process was more open than he had ever seen. Over the past months, public meetings were held specifically for the Jail project. They board listened to all comments from the community. They then contacted and checked all references for the three finalists. No board has put as much time into a project and they are to be congratulated. The City will benefit greatly from what had been done. SRA Minutes November 28, 2005 Page 2 of 10 BACKGROUND Ms. Hartford reviewed the history of the project. She noted that the City Council had voted to transfer the property to the SRA in October of 2004. The SRA hired The Cecil Group and Peter Smith Associates in December of 2004 to undertake a Reuse Study for the Old Salem Jail and this was based on the recommendations of the staff, SRA representatives, and citizens. Many months were spent creating a thorough document. There were two public hearings held on February 8 and March 9, 2005, which were very well attended, to discuss the reuse alternatives. The Reuse Study was completed in June 2005. Meetings were held with representatives of the Salem Historical Commission, Historic Salem, Inc. (HSI), and Massachusetts Historical Commission (MHC) to discuss historical preservation issues. A Phase I environmental assessment was done and included in the developer’s kit. The jail property survey was updated and stamped and property boundaries were confirmed. In the spring, the SRA requested to extend the boundaries of the B-5 zoning district to include the Old Salem Jail and was approved by a vote of the City Council. This created a more flexible zoning so that a mixed-use proposal could be obtained, in response to the public comments received during the Reuse Study process. The developer’s kit was available on June 29, 2005. It was a great kit with lots of information. Over 30 copies were given out. Nine proposals were received on September 19. The field was narrowed to 4 finalists, who were interviewed on October 18 and 19 in Old Town Hall. The SRA continued to review the proposals with The Cecil Group and Peter Smith in order to review the financial qualifications and architectural and site plan issues. The historical community and interested citizens were kept informed throughout the process. Ms. Duncan then read the City Council resolution that recently passed 10-1, (attached and made a part of these Minutes) concerning the project, which she had received that day as well as an email message from Councilor Sosnowski (attached and made a part of these Minutes). The resolution made a request that the SRA consider in their choice of a developer maximizing revenue since the City is in financial crisis that may result in the City’s bond rating being lowered. They also requested that the SRA consider both short term and long term parking plans considering the downtown parking difficulties with other development the past year. Councilor Sosnowski’s email congratulated the SRA and the Planning Department for their work on the project and clarified the City Council order, which he had introduced. Ms. Duncan also stated that a letter was also received from Historic Salem, Inc. commending the SRA for their work. EVALUATION Ms. Duncan reviewed the evaluation criteria, which was described in the RFP. There were 5 basic criteria: Qualifications of the Developer and Development Team; Financial Benefit and Self- Sufficiency; Compatibility with Revitalization Goals; Quality of the Proposed Redevelopment Plan; and Quality of the Proposed Site Plan. Each development team was to be rated as highly advantageous, advantageous, non-advantageous (neutral), and disadvantageous (negative). Ms. Duncan stated that the RFP contained the specific basis of measurement for each criterion. The Classic Group did not meet the threshold for financial requirements, therefore, they were not included in the chart for rating by SRA members. SRA Minutes November 28, 2005 Page 3 of 10 Chairman Brennan stated that all three proposals met the threshold conditions and stated that those were historic preservation, financial capability, and readiness to proceed and complete. All three can do the job. Michael Brennan said that Diamond/Sinacori, New Boston Ventures, and Old Salem Jail Partnership were the three finalists. The evaluation criteria for each were reviewed (summary entitled, “Evaluation Criteria Table” is hereby attached and made a part of these Minutes). A. Qualifications of the Developer and Development Team Mr. Vickers went over each of the criteria and the basis for his ranking: 1. Development Capabilities: Financial Capability: Diamond/Sinacori good. New Boston Ventures very strong. Old Salem Jail Partnership strong. Business References: Diamond/Sinacori very strong. New Boston Ventures very strong. Old Salem Jail Partnership good. Experience: Diamond/Sinacori most qualified based on their work on the Dedham Jail. New Boston Ventures qualified. Old Salem Jail Partnership qualified. 2. Timely Redevelopment Diamond/Sinacori and New Boston Ventures are both capable to proceed as soon as possible and can conclude within a reasonable timeframe. Old Salem Jail Partnership is willing to proceed and able to conclude within a reasonable timeframe; however it was noted that the Old Police Station development took longer to complete than predicted by 2 years. Summary/Discussion Mr. Vickers stated that with respect to the financial capability he rated New Boston Ventures as highly advantageous, Diamond/Sinacori as advantageous, and Old Salem Jail Partnership as not advantageous. Ms. Sullivan noted that the evaluation was based on the ability to complete the project in a “down real estate market” and on strong relationships with financial institutions. She noted that Diamond/Sinacori did not have a complete commitment. Old Salem Jail Partnership had a letter from Danvers Bank that was not as strong as she would like and they would sell property to provide their own equity. New Boston Ventures became highly advantageous because they had a firm commitment from a bank. Mr. Baldini agreed wholeheartedly and thought they had put a lot of time into it. Mr. Connelly agreed and felt that New Boston Ventures scored higher consistently. Michael Brennan thought that they showed financial self-sufficiency. There was no disagreement with the ratings as offered by Mr. Vickers. B. Financial Benefit and Self-Sufficiency Mr. Connelly went over each of the criteria and the basis for his ranking: SRA Minutes November 28, 2005 Page 4 of 10 1. Economic Value: Purchase Price: Diamond/Sinacori $1.00. New Boston Ventures $100,000 plus 15% of gross proceeds in excess of $375/square foot for each unit. Old Salem Jail Partnership $1,062,000. Estimated Tax Revenue: Diamond/Sinacori estimated $211,216 annually. New Boston Ventures $155,000 to $159,000 total annually. Old Salem Jail Partnership $148,150 estimated annually. Indirect Benefits: Diamond/Sinacori will provide a portion of profits in excess of 20% to the Salem Affordable Housing Fund and will provide Master Planning Services for the Point Neighborhood. New Boston Ventures will provide one affordable live/work artist unit with a gallery in the barn and a jail exhibit in the Jail that will be open to the public. Old Salem Jail Partnership will provide 3% of their profit to community groups throughout the city. 2. Economic and Civic Vitality: Diamond/Sinacori provides all residential units but not active or lively mix of uses. New Boston Ventures provides a mix of residential and commercial uses through a restaurant, gallery space, and jail exhibit. Old Salem Jail Partnership provides a mix of residential units and some commercial office space but it is not an active and lively mix of uses. 3. Financial Self-sufficiency: Diamond/Sinacori, New Boston Ventures, and Old Salem Jail Partnership are all capable of fully improving and reusing property without use of City of Salem funds or subsidies. Summary/Discussion Mr. Connelly noted that staff estimated that all three would provide an estimated $150,000 annually in taxes, at a minimum. He stated that all proposals would provide economic and civic vitality with new residential condos, but some of the proposals were not as active and lively. The New Boston Ventures proposal did provide the active and lively use that was called for in the RFP with a restaurant, gallery space, and jail exhibit. Mr. Connelly thought that Old Salem Jail Partnership provided a proposal with mixed residential and business use, but not active use. As far as financial self-sufficiency, all three were ranked equally in that their proposals were not contingent upon using City funds. The proposals by New Boston Ventures and Old Salem Jail Partnership were found to be high in indirect and direct benefits. Mr. Connelly ranked the proposal by New Boston Ventures to be highly advantageous, Diamond/Sinacori to be highly advantageous to advantageous, and Old Salem Jail Partnership to be advantageous. Mr. Vickers stated that he ranked Old Salem Jail Partnership as highly advantageous due to the purchase price. New Boston Ventures is worthy of consideration due to a predicted 45 new jobs in the new restaurant. Diamond/Sinacori had the lowest price in part offset by higher taxes. He ranked Old Salem Jail Partnership as highly advantageous and the other two proposals as advantageous. SRA Minutes November 28, 2005 Page 5 of 10 Ms. Sullivan stated that Old Salem Jail Partnership would have been highly advantageous but was challenged by other factors. Diamond/Sinacori was advantageous to highly advantageous with higher taxes. Mr. Baldini stated that he agreed with the Board. He noted that New Boston Ventures had completed Dover Lofts in Boston ahead of schedule and the Aquitaine Restaurant has several locations in Boston including the Union Grill. Ms. Sullivan said that the City Council voted that the SRA consider purchase price. She commented that it would be highly unlikely that any funds would be available in fiscal year 2006 since permitting wouldn’t be completed and therefore the money for the acquisition would not be received for at least another 6-12 months. Mr. Baldini said that New Boston Ventures was highly complementary and that he liked the condo and restaurant space. He stated that New Boston Ventures was so overwhelmingly better that they had the others beat. C. Compatibility with Revitalization Goals Mr. Vickers went over each of the criteria and the basis for his ranking: 1. Preferred Uses Diamond/Sinacori’s proposal did not include the active mix use preferred. New Boston Ventures’ proposal included lively and active mix of uses that is open to the public. Old Salem Jail Partnership’s proposal was for mixed use but does not provide lively and active public use. Summary/Discussion Mr. Vickers stated, for clarification, that the three proposals were all very different. He reviewed that Diamond/Sinacori proposed 39 residential condos; New Boston Ventures proposed 29 residential condos, an artist’s live/work space, a restaurant, and a jail exhibit; and Old Salem Jail Partnership proposed 25 residential condos and 2 commercial office spaces. Mr. Vickers noted that there was a strong desire for mixed use and that the board clearly indicated the preference for this type of use. He believes that the proposal with a restaurant came the closest to fulfilling the requirements since it contained a quality upscale restaurant, museum, and public access. He ranked them as follows: New Boston Ventures as highly advantageous, Old Salem Jail Partnership as advantageous, and Diamond/Sinacori as non-advantageous since there was no commitment to mixed use. Michael Brennan noted that the board was fully committed and had gone out on their own to view the developers’ other projects. Mr. Vickers said that he had had a very good meal at the Union Grill, which is owned by Aquitaine. Ms. Sullivan commented that she had walked through Aquitaine and was very impressed. Mr. Connelly stated that people had implored him to see if the jail could remain open to the public. He said that the New Boston Ventures proposal was the only one that allows the public into the Jail. SRA Minutes November 28, 2005 Page 6 of 10 They also provided a mix of uses that are open and accessible. He ranked this proposal as highly advantageous since they were the only group who provided this. There was no disagreement on the ratings offered by Mr. Vickers. D. Quality of the Proposed Redevelopment Plan Mr. Vickers went over each of the criteria and the basis for his ranking: 1. Historic Preservation Diamond/Sinacori was ranked as a “Category 2” by MHC. MHC and HSI had concern regarding additional windows and dormers on the roof; however the issue was resolved during the interview. New Boston Ventures was ranked as a “Category 1” by MHC. Old Salem Jail Partnership was ranked as a “Category 1” by MHC. MHC and HSI felt that the proposal provided “unreasonable and unclear assumptions” concerning the jail structure in response to questions raised by The Cecil Group, resulting in likely significant increases in construction costs and revisions. 2. Architectural and New Construction MHC and HSI found Diamond/Sinacori’s proposal to be the best. They felt that New Boston Ventures’ proposal for the Jail Keeper’s House to be too closely replicated in the new construction, but the team agreed to modify the plans if selected. Old Salem Jail Partnership’s proposal for underground parking would minimize surface spaces but the new construction was thought to be institutional and the detailing seemed out of proportion with the Jail Keeper’s House. Summary/Discussion Mr. Vickers stated that MHC reviewed all the proposals and found that they all committed to the Secretary of the Interior’s Standards for Historic Preservation. MHC ranked Diamond/Sinacori as a “Category 2” and they noted concern over additional windows and dormers but that these concerns were resolved. New Boston Ventures was ranked as a “Category 1”. Old Salem Jail Partnership was also ranked as a “Category 1”, although there was concern noted regarding “unreasonable but clear assumptions” about window openings, which if not resolved would be subject to likely revisions. As far as architectural and new construction, Diamond/Sinacori ranked the best of all three. Old Salem Jail Partnership’s proposal concerning underground parking minimized surface view. Comments concerning New Boston Ventures were that the new building too closely replicated the Jailer’s House. Therefore, Mr. Vickers noted that Diamond/Sinacori was ranked as highly advantageous, New Boston Ventures was ranked as advantageous, and Old Salem Jail Partnership was ranked as not advantageous. Ms. Sullivan reiterated that the consultants noted that Old Salem Jail Partnership provided “unreasonable and unclear assumptions concerning the Jail structure in response to the questions raised by The Cecil Group, resulting in likely significant increases in construction costs” and that Old Salem Jail Partnership “provided unreasonable but clear assumptions concerning the Jail structure and window openings, resulting in likely subsequent revisions and some costs.” Ms. Sullivan concurred with Mr. Vickers. SRA Minutes November 28, 2005 Page 7 of 10 Mr. Vickers said that the architectural question was regarding the problem of roof support during construction due to interior configuration. This additional construction cost was not identified. Mr. Connelly agreed with Mr. Vickers’ rankings. He noted that all three basically passed muster with the historic restrictions. The teams would be flexible to make it work. There was no disagreement with the ratings offered by Mr. Vickers. E. Quality of the Proposed Site Plan Mr. Connelly went over each of the criteria and the basis for his ranking: 1. Site Character: Diamond/Sinacori retained valued historic elements, the Bridge St. side was landscaped, parking areas occupied a central visible location on St. Peter St. New Boston Ventures retained existing buildings and character, central green area resembles a traditional New England “village green” character, parking area public visibility is minimal. Old Salem Jail Partnership retained valued historic elements, Village Green offers attractive landscaping, parking areas are hidden from public view. 2. Compatibility: All three proposals were compatible with the surrounding uses and areas. 3. Parking: Diamond/Sinacori called for one space per bedroom, met current zoning, the underground parking made reasonable and clear assumptions. New Boston Ventures called for adequate parking for the units, valet parking for the restaurant, and additional parking to be leased at the East India Garage. Short term parking for the restaurant would be located off Bridge St. The plan met current zoning, but the project would require approval from the State for access from the realigned Bridge St. Old Salem Jail Partnership called for 2 spaces per unit plus 12 visitor spaces and met current zoning. The plan will require approval from the State for Bridge St. access. The underground parking was found to be unreasonable and incomplete in its assumptions. No commitment was made for nearby senior parking needs by any of the developers. 4. Use of Other Sites: Diamond/Sinacori and Old Salem Jail Partnership did not require off-site parking. New Boston Ventures intended to lease parking at the East India Garage and did not preclude nor require the use of other sites for associated parking. Summary/Discussion Mr. Connelly noted that Diamond/Sinacori’s parking plan was compatible. They provide for one space per bedroom and that does meet the zoning requirement. The underground parking is reasonable and any issues concerning it had been resolved. He noted that there had been no commitment by any of the developers concerning parking for the nearby senior housing development. SRA Minutes November 28, 2005 Page 8 of 10 New Boston Ventures plan was also compatible. They would be using other sites such as the garage and other lots for the restaurant. Old Salem Jail Partnership was compatible and met zoning requirements. They provide two spaces per unit with twelve visitor spaces. Based on the criteria, Mr. Connelly noted that New Boston Ventures and Diamond/Sinacori were ranked as highly advantageous, and Old Salem Jail Partnership was ranked as non-advantageous. Mr. Vickers said that The Cecil Group raised serious questions about Old Salem Jail Partnership locating so many cars on the site and the effect on entering and exiting the site. They felt that the plan would most likely have to reduce the number of cars and that it relied too heavily on tandem parking. Ms. Sullivan noted that the access ramp to the garage would be at 16 percent and would require motorists to back up across the sidewalk and into the street. She said it is not advisable to allow cars to back up over the sidewalk and into the city street. She added that she is on the Planning Board and that they take traffic flow issues seriously. The plans would have to be redone if the Planning Board did not approve the plan. Ms. Sullivan said that she agreed with the rankings. DISCUSSION Michael Brennan noted that the City Council had asked that the issue of providing senior housing residents parking spaces be added to the RFP. The consultants said that parking is at a premium. None of the nine proposals guaranteed it. That criterion was a wish list item. He added that they would do what they could to satisfy the seniors and would approach the MBTA or garage to try to help. Mr. Baldini noted that they had given the matter good reasonable thought. Ms. Sullivan stated that Diamond/Sinacori was offering Master Planning Services for the Point Neighborhood. She said that the board had not forgotten that and that might be able to be done using CDBG funds through the Department of Planning and Community Development. Ms. Duncan noted that none of the nine proposals had addressed the senior parking issue. The need had been identified through Councilor Sosnowski. Councilor Sosnowski said that the City Council had asked that it be considered since the seniors had been using 12 spaces on the site temporarily. Mr. Brennan said that the board agreed to do due diligence on the issue. Mr. Connelly publicly thanked the Historic Commission, the SRA staff, and The Cecil Group for their work. He noted that the consultants’ expertise was valuable and that they had been there when needed and explained things in clear English. Ms. Sullivan added that the process with the board members and staff had been open, intelligent, and thoughtful. She was very honored to have been a part of it. Mr. Baldini said that he had received phone calls from Salem businesses and that there had been no negativity. He thanked the citizens of Salem. Michael Brennan concurred. He noted that all three developers could do the project and that all three had pluses. It came down to reviewing every reference, the financial information, and ideas, and that all were important. There was no disagreement on the rating offered by Mr. Connelly. SRA Minutes November 28, 2005 Page 9 of 10 MOTION Mr. Baldini moved that the firm of New Boston Ventures be designated as the first choice developer of the Old Salem Jail. Ms. Sullivan seconded the motion. Mr. Vickers stated that subject to the motion there had been a lot of discussion of the three very qualified proposals and that looking at the long term, New Boston Ventures was the best choice. A roll call vote was taken, and the vote was as follows: Yeas Conrad Baldini Michael Connelly Christine Sullivan Russell Vickers Michael Brennan The motion passed unanimously (5-0). Ms. Sullivan moved that the firm of Diamond/Sinacori be designated as the second choice developer of the Old Salem Jail. If the first choice fails to enter into an LDA, or drops out of the process, they would replace them. Lynn Duncan noted that the SRA would hold the original $3,000 deposit for the first three finalists. Mr. Connelly seconded the motion. A roll call vote was taken, and the vote was as follows: Yeas Abstentions Conrad Baldini Michael Brennan Michael Connelly Christine Sullivan Russell Vickers The motion passed (4-0, one abstention). Mr. Vickers moved that The Classic Group did not meet the criteria and did not provide adequate proof of financial feasibility and, therefore, their deposit would be returned and the firm would be removed from consideration. Mr. Baldini seconded the motion. A roll call vote was taken, and the vote was as follows: Yeas Conrad Baldini Michael Connelly Christine Sullivan Russell Vickers Michael Brennan The motion passed unanimously (5-0). Representatives of New Boston Ventures thanked the SRA and noted that the process was one of the most thorough and intense that they had ever been through. They stated that they were honored to have been chosen and looked forward to getting started on the project. SRA Minutes November 28, 2005 Page 10 of 10 ADJOURNMENT There being no further business, Mr. Baldini moved to adjourn the meeting. Mr. Vickers seconded the motion, and the motion passed (5-0). Meeting stands adjourned. Respectfully submitted, Debra Tucker Clerk