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HomeMy WebLinkAbout02/10/25 PRHA MinutesPulaski Redevelopment and Housing Authority Meeting Minutes February 10, 2025 The Chairman called the meeting to order at 6:03 p.m. and asked for a roll call. Lane Penn- Aye Terry Hale- Absent Brooks Dawson- Aye Charles Underwood- Aye Michelle Poore- Aye Joseph Goodman- Aye Thomas Underwood- Aye Consideration of February 22, 2024 minutes The motion was made by Mr. Goodman and seconded by Mr. Dawson to approve the minutes as written. Lane Penn- Aye Terry Hale- Absent Brooks Dawson- Aye Charles Underwood- Aye Michelle Poore- Aye Joseph Goodman- Aye Thomas Underwood- Aye Discussion Grants Received Update Austin Painter, Project Engineer, reported he has been managing the projects that are going to be discussed throughout their life and works as the contract administrator for the brewery. He stated the properties on West Main Street, 67, 68, and 69 West Main were sent over to Garland Properties previously from the Housing Authority, given a development agreement to develop those into adequate multi-use apartments and commercial properties. Mr. Painter reported they are high caliber spaces within the town and they did a great job turning those into living spaces and places for possible businesses in the future. The other two properties that are involved from the Housing Authority were Calfee Community and Cultural Center and the brewery. Great Wilderness Brewery Contract Mr. Painter presented the board with a few photo updates from the brewery and described the cosmetic changes that will occur with the paint, bar area, and restrooms within the facility. He reported the building has gone through multiple different changes throughout the project and many challenges but with the support of state funding the building is almost at completion. There were multiple structural issues that were in the building that were not accounted for in the original cost estimate and design, once the floor and subflooring was removed, there was significant termite damage and beam damage throughout the second-floor beams and flooring. He stated the only thing that exists from the original structure is the roof, the three of the exterior walls, and one segment over the brew room of the second floor. The positive of this is everything that remains, specifically those three exterior walls, are what held the historic character of the building, everything else was in a dilapidated shape and needed to be removed to achieve a structurally sound building. Mr. Painter reported because of structural issues, we had to see significant change orders to increase the cost of the project, we applied for additional funding through DHCD, through their industrial revitalization fund and was awarded an additional $200,000 bringing in the total amount for the project at $1,055,000. Mr. Painter reviewed three key aspects of the contract which includes; terms of the lease match those grant requirements from DHCD, in exchange for 10 years of operating a brewery, as well as at least a capital investment of $280,000 into the property during that timeline and maintaining three jobs, amongst other requirements, the tenant will be able to purchase the building at $1 after that 10-year agreement and the lease has expired. In addition to that, the tenant will be paying rent equal to the property taxes for both the town and county, that’s to basically supplement any payments that the Housing Authority would have to make for owning the property during that time period. In addition, the town has provided a meals tax incentive to the tenant. Mr. Dawson asked what qualifies towards the $280,000 investment? Mr. Painter stated a significant portion of that, the owner of the brewery has already provided, most entirely being equipment, he’s providing all of his brewing equipment and there’s specific equipment that he needs to run his business. Mr. Dawson questioned the $280,000 investment being he will have equipment that he will have ownership of regardless. Mr. Painter stated it would add value to the property, it will just be split ownership. Mr. Charles Underwood questioned if he’s going to match the investment in the facility, not just bring equipment that’s transportable and if it fails, he takes the kit back home with him? Mr. Painter stated the contract has already been signed and agreed upon and it’s just for the extent of the 10 years, he has to provide that amount of investment into the property but he will talk with the town attorney to figure out what applies. Mr. Goodman stated the authority was told that there was going to be some other stuff that had to be acquired or spent for the facility, as part of it was just what he already had and then there was going to be a need to increase it and that might be how we got the $280,000. Mr. Painter stated from his understanding, there are additional factors that go into just installing his equipment, additional lines and fixtures have to be installed which will be a part of the building, the language of the lease and what he agreed to is that he will provide that amount of taxable value to the facility by the end of that 10 years. Mr. Thomas Underwood expressed his concerns that the tenant could sell all the equipment before the 10-year lease is expired and the tenant would gain all his money back. Mr. Dawson stated the town still gains all the money from the building itself, it went from a building that was nothing to a building that’s had $900,000 worth of improvements made that can go towards another purpose. He then questioned if the kitchen equipment and things of that nature would be under the ownership of the Housing Authority. Mr. Painter stated that is part of the current scope of the project, so it would be under the Authority. Mr. Goodman stated the equipment was described to the Authority as things that are required for brewing, so specific to the process of making beer. He was using that equipment in a garage location before but anything else that was purchased would be part of the grant and the process and would be retained ownership. Mr. Thomas Underwood stated it would be interesting to find out if the language in the lease specifically stated anything that’s attached to the building, you can’t remove it. He gave an example as the lease agreements he’s been involved with, a tenant can’t remove a ceiling fan because it’s attached to the building, it becomes a part of that building. He then asked when the completion date would be. Mr. Painter stated the completion date for construction is set to complete within the next month or so, there’s a pending change order with the electric, which is why there’s a vague time frame but opening date would be up to the owner’s ability but he wants to open as soon as possible, hopefully by summer 2025. Mr. Dawson asked about the property itself, is there anything else going towards the actual exterior of the building, and as far as the exterior aesthetics of the property if that cost is on the tenant. Mr. Painter reported that the contractors will return it back to a usable state, it will take a while for grass to grow but it will not look like a construction site, all the gravel will also be relocated to the East side of the building that will be an industrial driveway. Mr. Painter also reported we are in the process of seeking additional funding to help assist in completion of the second floor and/or exterior of the building. Based on where the funding source comes from, if it’s DHCD again, they won’t assist with the exterior so that will independently up to the tenant but we’re trying to gather additional funds to finish out the second floor which will give him additional seating and occupancy space. Mr. Goodman asked if there were going to be any liens from DHCD against the property or is it going to be free and unencumbered. Mr. Painter stated it would unencumbered. Calfee Community and Cultural Center Mr. Painter reported there was a cost estimate done pre-COVID for $2 million and post COVID, the cost estimate was redone and values were at $4 million, it doubled that extent and the bid came back to $6.7 million, because of the increased cost, we ended up phasing the project and achieving it through multiple different additional funding sources. Phase 1 totaled at $2.2 million, that is the completed construction. As of now, they have a warming kitchen to aid childcare classrooms and offices. Phase 2 would be to expand and extend the commercial kitchen as well as rehabilitating the exterior portions of the building such as downspouts and some other aesthetic portions of the exterior, most importantly, the roof. Mr. Painter reported the funding for Phase 2 in the amount of $700,000 was from ARC, which is an extension of DHCD, $500,000 was from the National Park Service, and $500,000 from Calfee LLC. He reported he hopes to have the bid out soon to get the expansion and most importantly the exterior and roof portions of the building complete. The third phase is in no particular order, the funding application has been through the Virginia Department of Historic Resources, that adds a museum, meeting spaces and offices, and a digital learning lab. The hope is to expand from not just community development, but economic and business outreach to the local community. Mr. Dawson asked when the bids would go out for the roof. Mr. Painter stated he was told within the next few weeks. Mr. Dawson asked if there was something they were waiting on. Mr. Painter stated the funding has been allocated, but because of the nature of the funding, we are proceeding with the information that we have and preparing for alternative situations because of the federal funding. Mr. Goodman stated they are trying to get the bids out, the issue they are running into is the bids keep coming in higher than expected, they have to figure out if there’s adjustments they’re going to have to make. Mr. Dawson asked if that covered just the roof or is that for other parts- does the $2.2 million cover the roof and maybe not all the other aesthetics. Mr. Goodman stated since he’s new to the Calfee Board, he could not say for certainty that that’s a yes, that he was still figuring out the budget, but everything they have run into so far, the bids have come back too high and they have to scope it back to the realm of reality and figure out what they can adjust. He stated the roof is a big deal, that there is a leak in one of the new classroom spaces. Mr. Dawson stated he wasn’t sure what their level of control would be but the roof is a necessity compared to new attractive downspouts. If the project is being held back and slowed when there’s this much money invested in it already, potentially damaging work that’s been done, it seems like we might need to, we may be all ready, but he hopes that we’re forcing a hand to make sure what has to be done is done and not held back by something that doesn’t necessarily have to be done. Mr. Thomas Underwood asked if the project was already in phase 2, which included trying to get the roof completed. Mr. Painter stated yes. Mr. Goodman stated the ARC funds, Calfee has already received them so now it’s just a matter of making the work match the funding that’s available as prices continue to increase. Mr. Penn asked if the childcare facility is being used. Mr. Goodman reported they are open, they have seven students enrolled currently in the daycare program and they’re working on trying to expand that, so they will need to see what changes come with government funding, as that was a key part of the program so that students that could not afford to go would have a funding source. Mr. Thomas Underwood asked what the capacity of the daycare facility was. Mr. Goodman stated it depends on the age of the children in the classrooms. Mr. Thomas Underwood asked if they have done any PR for the program as he doesn’t have small children anymore, but he has grandchildren, and people looking for childcare and he wasn’t aware that the facility was open. Mr. Goodman stated Pulaski County was considered a childcare desert, so not a lot of advertising is needed but he will talk with Jill about it because there’s no partnership with VT but agreed there is some work that still needs to be done. Additional Updates No additional updates were given. Board Member Comments Mr. Charles Underwood questioned the BBQ restaurant opening on Main Street. Mr. Goodman stated the project got cancelled. Mr. Painter stated to his understanding, the Housing Authority was not involved in the property. Mr. Dawson asked if there were any funds currently sitting in a rolling account for roof loan funds and things of that nature that hasn’t been spent or expecting to come back in. Mr. Goodman stated the revolving roof fund was direct action from Council, it wasn’t done through the PRHA and regarding the Housing Authority funds, they spent some of them and got a bunch back when they sold a building, and he wasn’t exactly sure what’s in the account. Ms. Hale stated she would send out the financial statement. Mr. Dawson stated he was curious whether those funds are assigned to what principals, if they’re just open to the Authority to do it, it’s bidding, or if they’re assigned to roofing loans. Mr. Goodman stated the roof fund never went through the PRHA, if it was, it was done because we needed an organization to funnel the money through, but it was never allocated to the PRHA to have any decision over, it was purely granted under the power of Council. Mr. Penn asked if there were any suggestions for a future meeting. Mr. Goodman asked not to schedule on Mondays and Wednesdays and on the third and fourth Thursdays of the month, as a lot of folks are usually busy on those days. Ms. Hale stated there weren’t any upcoming agenda items but if a meeting needed to be called, we could call one if something comes up. It was agreed upon that the second Tuesday of the month works best for scheduling. With no further business, the Chairman adjourned the meeting at 6:39 p.m.