Crystal Report Viewer

1000 ‎Rochester Hills Dr‎

Rochester Hills‎, ‎MI ‎

48309‎

(‎248‎) ‎656‎-‎4600‎

Home Page‎: ‎

www‎.‎rochesterhills‎.‎org‎

Rochester Hills

Minutes

Local Development Finance Authority

Brandy Boyd‎, ‎Clarence Brantley‎, ‎Michael Damone‎, ‎Michael Ellis‎, ‎Lois Golden‎, ‎Lori Hartnell‎, ‎

Darlene Janulis‎, ‎Michael Kaszubski‎, ‎Daniel Romzek‎, ‎Stephan Slavik‎

7:30 AM

1000 Rochester Hills Drive

Thursday, July 11, 2013

CALL TO ORDER

Chairperson Stephan Slavik called the Regular LDFA Meeting to order at ‎

7‎:‎30 ‎a‎.‎m‎. ‎in Conference Room ‎221‎.‎

ROLL CALL

Michael Kaszubski‎, ‎Clarence Brantley‎, ‎Lois Golden‎, ‎Stephan Slavik‎, ‎

Darlene Janulis‎, ‎Brandy Boyd and Daniel Romzek‎

Present

7 -

Michael Damone, Michael Ellis and Lori Hartnell

Absent

3 -

Quorum present‎.‎

Also present‎: ‎Ed Anzek‎, ‎Director of Planning and Economic Dev‎.‎

Pamela Valentik‎, ‎Manager of Economic Dev‎.‎

Kurt Dawson‎, ‎Director of Treasury‎/‎Assessing‎

Laurie Taylor‎, ‎Deputy Director of Assessing‎

Keith Sawdon‎, ‎Director of Fiscal‎

Paul Davis‎, ‎Deputy Director of DPS‎/‎Engineering‎

John Kerr‎, ‎Strategic Communication Solutions‎

Bill Bullard‎, ‎Strategic Communication Solutions‎

Maureen Gentry‎, ‎Secretary‎

APPROVAL OF MINUTES

2013-0247

April ‎25‎, ‎2013 ‎Special Meeting‎

A motion was made by Golden‎, ‎seconded by Boyd‎, ‎that this matter be Approved ‎

as Amended‎. ‎The motion carried by the following vote‎:‎

Aye

Kaszubski, Brantley, Golden, Slavik, Janulis, Boyd and Romzek

7 -

Absent

Damone, Ellis and Hartnell

3 -

NEW BUSINESS

2012-0245

Discussion and request for approval of the ‎2‎nd Quarter Budget Amendments to ‎

the ‎2013 ‎LDFA Budget and approval of the ‎2014‎-‎2016 ‎LDFA and SmartZone ‎

Budgets‎.‎

Mr‎. ‎Anzek introduced the budget agenda item‎, ‎suggesting that the LDFA ‎

needed to have a discussion about the Personal Property Tax ‎(‎PPT‎) ‎and ‎

its elimination‎. ‎Staff did some digging for the long‎-‎range about what ‎

would happen with projected revenue‎, ‎and they determined that it would ‎

drop to ‎$‎3 ‎million from ‎$‎12 ‎million‎. ‎He noted that Ms‎. ‎Taylor ‎(‎Deputy ‎

Director of Assessing‎) ‎had attended a lot of meetings on the subject‎, ‎and ‎

she would present the loss of revenue that would occur with the ‎

elimination of the PPT‎.‎

Ms‎. ‎Taylor handed out some spreadsheets‎, ‎the first of which was a ‎

projection for what would happen if the PPT exemption for industrial ‎

manufacturing was approved by voters‎, ‎and the second sheet showed the ‎

numbers without the exemption‎. ‎The proposed elimination was slated to ‎

be implemented in ‎2016‎. ‎Any new purchases from ‎2013‎, ‎2014 ‎and ‎2015 ‎

for industrial manufacturing would be exempted‎, ‎and companies would ‎

not file those on PPT returns‎. ‎The other part of the PPT elimination would ‎

be for any company with less than ‎$‎40‎k in taxable value‎. ‎That would ‎

have a very minimal impact in the LDFA area in that the eligible ‎

manufacturers generally had substantially more than ‎$‎40‎k in taxable ‎

value‎. ‎The ‎2016 ‎elimination of new purchases would include a lot of ‎

companies‎, ‎however‎. ‎In ‎2016‎, ‎all new purchases would be eliminated ‎

until it phased out in six or seven years‎. ‎

Mr‎. ‎Dawson pointed out that one of the things that was not covered when ‎

they exempted the industrial manufacturing personal property was that ‎

the exempted property was not taken out of the LDFA base for capture ‎

calculations‎. ‎There was no legislation that allowed the exempted PPT to ‎

be removed from the LDFA base value‎, ‎making the negative capture ‎

actually work against the LDFA‎. ‎As the personal property capture ‎

became a negative‎, ‎it offset the real property positive capture‎. ‎He ‎

remarked that it would really be a ‎"‎whammy‎" ‎for the LDFA capture well ‎

into the future‎.‎

Mr‎. ‎Bullard advised that there were some technical changes to the PPT ‎

bills‎. ‎There were eight bills signed by the Governor last December to ‎

phase out the PPT in ‎2022‎. ‎The reason the PPT had not been phased ‎

out in the last ‎30 ‎or ‎40 ‎years was that no one could figure out how to ‎

reimburse local units of government for the lost revenue‎. ‎The legislature ‎

and Governor had come up with a plan that would be on a ballet proposal ‎

in August ‎2014‎, ‎and it would be very confusing‎. ‎The business groups ‎

would present it as an opportunity to take a part of the State Use Tax and ‎

give it to metropolitan areas throughout the State‎. ‎It was something in the ‎

Constitution that was never used before‎. ‎He commented that it would be ‎

an interesting campaign‎, ‎because the business groups would state that ‎

eliminating the onerous PPT would make the business climate better and ‎

would create jobs‎. ‎The opponents would state that local units of ‎

government would be hurt‎, ‎and they would lose revenue for police‎, ‎fire ‎

and other essential services‎. ‎The counter to that was that if the proposal ‎

was passed‎, ‎part of the State Use Tax would go to the metropolitan ‎

entities and be distributed to local units of government‎. ‎There was also a ‎

provision in one of the bills that allowed a local unit to have an essential ‎

services assessment‎, ‎which would be an increased millage‎. ‎That would ‎

put Mayors and City Councils in a difficult spot‎. ‎If the ballot proposal ‎

passed in August ‎2014 ‎and the PPT phase out went forward‎, ‎they would ‎

have to decide whether to increase the millages that funded police and ‎

fire‎. ‎Overall across the State‎, ‎it would be very difficult to figure out how ‎

eliminating the PPT would affect each municipality‎. ‎The State was saying ‎

that ‎80‎% ‎of lost revenue would be replaced through one of the two ‎

mechanisms‎. ‎They knew there would not be ‎100‎% ‎reimbursement‎. ‎The ‎

Governor was going to be up for re‎-‎election‎, ‎and Mr‎. ‎Bullard believed that ‎

the August ‎2014 ‎proposal would be a referendum on the Governor’s ‎

policies‎. ‎Mr‎. ‎Bullard thought that not only from the PPT‎, ‎but the ‎

opponents of the proposal would say that the Governor had already cut ‎

taxes for business by going from the Business Tax to the Corporate ‎

Income Tax‎. ‎That was a cut of hundreds of millions of dollars in business ‎

taxes‎, ‎and it was funded by increasing taxes on individuals ‎(‎i‎.‎e‎.‎, ‎Pension ‎

Tax increased‎, ‎Earned Income Tax Credit eliminated‎, ‎limitations on the ‎

Homestead Property Tax Credit‎). ‎The primary election typically had a ‎

20‎-‎24‎% ‎turnout‎. ‎If it was a close vote‎, ‎perhaps ‎12‎% ‎of the registered ‎

voters would decide whether the PPT was phased out or not‎. ‎He thought ‎

that the ballot language was very complicated‎, ‎and he did not know how it ‎

could be explained in ‎30‎-‎second commercials‎. ‎Mr‎. ‎Bullard introduced ‎

Rachael Lombardo‎, ‎who was interning for SCS for the summer‎. ‎She had ‎

contacted the State Chamber and some other business groups‎, ‎and SCS ‎

would be meeting with the Michigan Municipal League ‎(‎MML‎) ‎soon‎. ‎He ‎

reiterated that there were some technical changes to the bills in the works‎, ‎

and indicated that they could address some of the issues raised by Staff‎.‎

Ms‎. ‎Taylor asked if there was a Sales Tax increase included in the ‎

proposal‎. ‎Mr‎. ‎Bullard stated that it was not‎, ‎and he explained that it was ‎

part of the transportation package‎, ‎which had not been passed‎. ‎The ‎

Governor had two priorities‎, ‎the first being Transportation Tax increases ‎- ‎

increased registration fees and gasoline taxes ‎- ‎which would still be ‎

debated‎. ‎There might be a Sales Tax increase as part of that‎. ‎A lot of ‎

people thought that nothing would get done‎, ‎and that there would be no ‎

transportation reform‎. ‎The other thing the Governor was pushing for was ‎

Medicaid expansion‎, ‎which Mr‎. ‎Bullard had been working on very closely‎. ‎

The House passed it‎; ‎the State would get about ‎$‎2 ‎billion for a couple of ‎

years of increased Federal funds in Michigan‎, ‎which would be spent on ‎

health care for about ‎400‎,‎000 ‎people‎. ‎Some people have wondered why ‎

the State would not accept Federal money‎. ‎In the normal atmosphere‎, ‎

people felt that if the State got Federal money for the citizens‎, ‎it would be ‎

a good thing‎. ‎The opposition‎, ‎led by Tea Party Republicans‎, ‎believed ‎

that the State would be embracing Obamacare‎, ‎and they did not want to ‎

have anything to do with it‎. ‎The Medicaid reform bill passed the House in ‎

a bi‎-‎partisan vote‎. ‎It stalled in the Senate‎, ‎but there were groups working ‎

on it‎, ‎and many expect that the bill will pass by the middle of September‎. ‎

Then they would address the transportation issue‎, ‎but he was not sure ‎

they would come to a solution about that before the next election‎.‎

Ms‎. ‎Taylor continued that regarding the PPT exemption‎, ‎she projected ‎

out until ‎2024 ‎an estimated amount of the increase in taxable value and ‎

the elimination of the PPT for eligible industrial manufacturing and what it ‎

meant to revenue for the LDFA‎. ‎She referred to the ad valorem real ‎

property numbers and the increase in taxable value based on the ‎

consumer price index‎, ‎and said that it would be flat for next year at ‎0‎% ‎

then down to ‎1 ‎½‎% ‎and ‎2‎% ‎projected out‎. ‎The sheet showed the taxable ‎

value in ‎1994‎, ‎the base year for the LDFA‎, ‎and the projected taxable ‎

value and the amount of capture‎. ‎She had listed the real property ad ‎

valorem and the personal property ad valorem‎, ‎and it showed that ‎2016 ‎

personal property ad valorem taxable value would substantially drop from ‎

$‎38 ‎million to just over ‎$‎6 ‎million because of the elimination of the ‎

purchases from ‎2013‎, ‎2014 ‎and ‎2015‎. ‎The majority of the taxable value ‎

would be in new purchases that were a result of less depreciation‎. ‎She ‎

reminded that as the equipment aged‎, ‎depreciation increased‎. ‎The third ‎

group showed the real property industrial facilities tax‎, ‎which had a lesser ‎

millage rate‎. ‎It had no base because it did not exist in ‎1994‎. ‎The ‎

projected revenue in ‎2013 ‎was over ‎$‎600‎k and dropped to ‎$‎177‎k in ‎2016‎. ‎

Overall‎, ‎it showed a taxable capture of ‎$‎3‎.‎5 ‎million‎. ‎Ms‎. ‎Taylor then ‎

referenced a table which showed projected capture of ‎$‎8‎.‎8 ‎million if the ‎

PPT was not eliminated‎. ‎

Mr‎. ‎Romzek referred to the personal property exempt schedule‎, ‎and said ‎

that it showed that the capture value dropped below zero‎. ‎Beginning in ‎

2016 ‎and beyond‎, ‎he wondered if those were payback periods‎. ‎

Mr‎. ‎Dawson explained that the negative went against the real capture‎, ‎so ‎

in ‎2016‎, ‎there was a minus ‎$‎11‎k‎, ‎which would go against the ‎$‎180‎k‎, ‎and it ‎

would net out‎. ‎There was no legislation currently for whether they would ‎

eliminate personal property as a capture to take it out of the base‎. ‎They ‎

would be able to modify the plan to eliminate those parcels that only ‎

captured on real‎. ‎It would not make a huge difference‎, ‎because they ‎

would lose ‎$‎.‎5 ‎million revenue by the exemption‎, ‎but starting in ‎2016‎, ‎

there would be some negative offset for some of the capture on the real ‎

property‎.‎

Ms‎. ‎Taylor thought that in the past‎, ‎the Board had talked about the ‎

SmartZone‎, ‎and the fact that it was in a negative capture‎. ‎It did not mean ‎

that the City had to pay down anything‎; ‎they just did not capture anything‎. ‎

If it went below zero‎, ‎there was no capture‎, ‎and nothing was paid to the ‎

SmartZone‎. ‎Mr‎. ‎Dawson added that it had been at zero since ‎2011‎. ‎Mr‎. ‎

Anzek further added that it was projected to stay at zero‎.‎

Mr‎. ‎Anzek remarked that they were “crystal‎-‎balling‎,‎” and they really did ‎

not know where the PPT would end up‎. ‎They wanted to show the LDFA ‎

Board‎, ‎because it had some expenditures in the proposed budget that ‎

posed a policy question‎. ‎They needed to determine whether they wanted ‎

to keep spending‎, ‎knowing that the capture might drop by ‎$‎5 ‎million ‎

between now and the end of the LDFA’s term‎. ‎They had talked about the ‎

need for the money for infrastructure improvements‎, ‎but they would have ‎

less capture for regenerating the area‎. ‎There was ‎$‎300‎k in the budget for ‎

major road improvements in the LDFA area‎, ‎and he wondered if the LDFA ‎

wanted to start slowing it down‎. ‎The proposed budget showed flat ‎

revenues over the next three years‎, ‎because they did not know what would ‎

happen‎. ‎They tried to take a conservative approach‎, ‎and striking ‎

something out of the budget at this time could be premature‎. ‎He wished ‎

to have that discussion‎.‎

Mr‎. ‎Slavik stated that they would definitely have to look at their priorities ‎

and talk with Mr‎. ‎Davis‎. ‎If they were going to take money out of some of ‎

the street repairs‎, ‎they had to make sure they were not shooting ‎

themselves in the foot and creating a different problem down the road‎. ‎

Some things would cost more in the long run‎. ‎Mr‎. ‎Anzek agreed that a ‎

$‎200‎k fix today could cost ‎$‎1 ‎million in five years‎.‎

Ms‎. ‎Golden said that for future meetings‎, ‎she would appreciate input from ‎

Staff regarding some of the pros and cons of doing different things‎. ‎She ‎

reminded that they were not alone‎; ‎DDAs and other groups were also ‎

affected‎. ‎Going forward‎, ‎she would really like to hear Staff’s opinion‎. ‎

Mr‎. ‎Anzek noted that he had not even had a chance to brief Mr‎. ‎Davis on ‎

the potential loss of PPT and what that would mean‎. ‎Every spring‎, ‎

Planning and Engineering Staff talked about road repairs and how much ‎

they would cost‎. ‎The purpose of LDFA capture was to maintain ‎

infrastructure‎, ‎and with the potential for the PPT elimination‎, ‎it was difficult ‎

to know what to plan‎.‎

Ms‎. ‎Janulis stated that she would not be in favor of reducing anything ‎

when it came to street repair‎. ‎She thought it was a sore spot in the ‎

community‎. ‎She said that she would not mind revisiting some of the ‎

beautification projects that oftentimes were necessary but if they did not ‎

get done‎, ‎it would not cause a bigger problem down the road‎. ‎She was ‎

uncomfortable with anything that would eliminate street repair or not ‎

improve sidewalk safety‎. ‎She thought they could talk as a group about ‎

what different priorities they might have while maintaining what they had‎. ‎

She suggested that the order could be safety and then beautification‎. ‎

She indicated that she did not want it to cause a bigger problem later on if ‎

they did not continue with street repairs‎. ‎

Mr‎. ‎Anzek recalled that about a year ago‎, ‎he introduced the subject of ‎

doing a five‎-‎year sidewalk program in the industrial parks‎. ‎In working with ‎

Mr‎. ‎Kerr and Mr‎. ‎Bullard‎, ‎he found that they had a good shot at some ‎

grant money for that‎. ‎They would not have to rely on LDFA money‎, ‎but ‎

they could still try to get the sidewalks completed‎. ‎

Chairperson Slavik said that was a good example of reprioritizing‎. ‎He ‎

thought that going forward‎, ‎until they knew more after the August ‎2014 ‎

ballot‎, ‎they could take the worst‎-‎case scenario‎, ‎reprioritize‎, ‎and get a ‎

game plan based on that scenario‎. ‎If things went the other way‎, ‎they ‎

could always reassess‎.‎

Mr‎. ‎Anzek reflected that being conservative had always been the City’s ‎

policy‎. ‎He summarized that the Board would like to continue funding the ‎

street program at the levels identified in the budget‎; ‎that they should not ‎

spend money on sidewalks at this point‎; ‎that efforts towards beautification ‎

should be reduced‎; ‎and they would monitor what happened at the State ‎

levels with the assistance from SCS‎.‎

Chairperson Slavik commented on his experience with the infrastructure ‎

improvements that had taken place in the City in the past year‎, ‎which he ‎

observed had been dramatic‎. ‎He felt that everyone had been impressed‎. ‎

He especially noted Crooks over M‎-‎59‎, ‎and remarked that it was like a ‎

brand new world‎.‎

Ms‎. ‎Golden thanked Staff for the presentation and information‎, ‎and ‎

agreed that it had been very helpful‎. ‎Mr‎. ‎Anzek said that they wanted to ‎

express it before the LDFA approved its budget‎. ‎Last year was the first ‎

time the LDFA actually approved its budget before Mr‎. ‎Sawdon included it ‎

in the budget that went to Council‎. ‎It was important to Staff to stand before ‎

Council and state that the LDFA had reviewed and approved its budget‎. ‎It ‎

was much better than doing so after the fact‎. ‎He reminded that they were ‎

really only locking into ‎2014 ‎numbers‎. ‎2015 ‎and ‎2016 ‎were projections ‎

and could be amended after a vote‎. ‎Mr‎. ‎Romzek observed that a year ‎

from now‎, ‎the Board would be a lot closer to the selection and would ‎

perhaps be more able to “read the tea leaves‎,‎" ‎and he moved the ‎

following motion from the packet‎:‎

MOTION‎ by Romzek‎, ‎seconded by Janulis‎, ‎that at the July ‎11‎, ‎2013 ‎

Regular Meeting‎, ‎the Rochester Hills Local Development Finance ‎

Authority hereby approves the ‎2‎nd quarter amendments to the ‎2013 ‎

LDFA Budget and approves the ‎2014‎-‎2016 ‎LDFA budget‎.‎

Voice Vote‎:‎ All Ayes‎

Absent‎:‎ Damone‎, ‎Ellis‎, ‎Hartnell ‎MOTION CARRIED‎

Hearing no further discussion from the Board‎, ‎Ms‎. ‎Janulis moved the ‎

following motion‎:‎

MOTION‎ by Janulis‎, ‎seconded by Romzek‎, ‎that at the July ‎11‎, ‎2013 ‎

Regular Meeting‎, ‎the Rochester Hills Local Development Finance ‎

Authority hereby approves the ‎2014‎-‎2016 ‎SmartZone budget‎.‎

Voice Vote‎:‎ All Ayes‎

Absent‎:‎ Damone‎, ‎Ellis‎, ‎Hartnell ‎ MOTION CARRIED‎

Approved

Chairperson Slavik stated for the record that both motions had passed ‎

unanimously‎.‎

COMMUNICATIONS

There were no Communications brought forward‎.‎

UNFINISHED BUSINESS

2013-0139

Update from Strategic Communication Solutions ‎- ‎John Kerr‎, ‎SCS‎

Mr‎. ‎Kerr said that he and Mr‎. ‎Bullard appreciated that the Board had ‎

changed the agenda order to allow the budget presentation first‎, ‎because ‎

they also wanted to see the numbers‎. ‎Although they might be a year ‎

away from really figuring out which way the PPT would go‎, ‎he thought ‎

everyone would see a pretty drawn‎-‎out campaign‎. ‎He felt that even at the ‎

October meeting‎, ‎they would know a lot more than they did now‎. ‎There ‎

were groups working in Lansing now‎, ‎and he noted that the MML was not a ‎

part of that‎. ‎They were very offended‎, ‎and they felt that the Governor was ‎

setting their membership‎, ‎which included municipalities‎, ‎townships and ‎

counties up for defeat‎. ‎Mr‎. ‎Kerr indicated that there was a long way to go‎, ‎

and he would be surprised if the tax was completely exempt‎, ‎but there ‎

would be a lot of negotiations with regard to reimbursement‎.‎

Mr‎. ‎Bullard stated that the bottom line was that if the ballot proposal ‎

passed in August ‎2014‎, ‎every city and township in the State would have ‎

less revenue‎, ‎although how much less was unsure‎. ‎There were two ‎

buckets to get reimbursement‎; ‎one was from the Metropolitan Authority ‎

and the other was a special assessment‎, ‎which would require action by ‎

City Council‎. ‎That would be a decision he did not think the City Council ‎

would want to make‎, ‎but if it passed‎, ‎they would have to‎. ‎He was not sure ‎

if cities would end up with ‎80‎% ‎of their revenues‎, ‎and it could be only ‎

50‎-‎80‎%.‎

Ms‎. ‎Janulis pointed out that Rochester Hills had been a little luckier than ‎

some communities‎, ‎because some had been in a tight deficit before the ‎

downturn‎. ‎She added that when the local revenue and property taxes ‎

dropped with the Headlee Amendment‎, ‎they would never get caught up‎. ‎It ‎

would be ‎25 ‎years before they could get back to ‎2007 ‎or ‎2008 ‎numbers‎. ‎

There were a lot of communities that did not have the capacity for growth ‎

to make it up in any way‎.‎

Mr‎. ‎Kerr noted that the battle had been taking place for almost two years‎. ‎

Ms‎. ‎Janulis recalled mentioning at the last meeting that the Governor had ‎

been talking about it for awhile‎. ‎She had been to the MML meetings and ‎

other conferences he had been at‎, ‎and he definitely had not been ‎

keeping it a secret‎. ‎

Mr‎. ‎Kerr agreed‎, ‎and said that was why campaign season might pick up ‎

early this year‎, ‎especially for an issue like this‎. ‎He thought that the ‎

Democrats would‎, ‎in a sense‎, ‎probably use it as an opportunity to begin ‎

their campaign‎. ‎Mr‎. ‎Bullard had been very active in Lansing with ‎

Medicaid expansion‎, ‎and Mr‎. ‎Kerr thought it would become a priority for ‎

him as well‎. ‎In April‎, ‎he had talked about what SCS could do as far as ‎

researching opportunities for creative financing and Federal and State ‎

funding opportunities‎. ‎He wanted to make sure the Board knew that SCS ‎

had a very aggressive legislative monitoring and advocacy service they ‎

provided the City and the LDFA‎. ‎Their commitment was to be on the front ‎

line of this issue and to make the City aware of the latest discussions‎, ‎

because they knew it would have a serious impact in a host of ‎

communities‎. ‎He said that they would be happy to come back in October ‎

and report on the latest happenings‎, ‎which could‎, ‎hopefully‎, ‎help with ‎

budget projections‎. ‎He hoped the Board could see the value SCS could ‎

bring from legislative monitoring‎. ‎He reiterated that transportation ‎

funding would be a big piece of the package‎, ‎especially as it related to ‎

some of the non‎-‎motorized improvements‎. ‎He mentioned his teammate‎, ‎

Ron DeCook‎, ‎who was a former MDOT Government Affairs Director who ‎

was helping SCS navigate through some of the transportation language‎. ‎

Mr‎. ‎Kerr stated that Mr‎. ‎DeCook was fantastic at finding pots of money ‎

that could be helpful in the LDFA district‎. ‎The legislative piece would be a ‎

big part of what they would work on over the next year‎. ‎He reiterated that ‎

they would pursue Federal and State financing opportunities‎. ‎He noted ‎

that he was fortunate to take a driving tour of the LDFA area‎, ‎and he got to ‎

see the road improvements‎, ‎but he stressed that there were still things to ‎

do in the industrial areas‎. ‎

Mr‎. ‎Kerr related that another big piece was the very visible parcel on the ‎

M‎-‎59 ‎Corridor ‎- ‎the Suburban Softball site‎. ‎It was a gem that they had ‎

looked at for a number of years‎. ‎One thing they put in their scope was ‎

establishing a working group to advance what they needed to do for the ‎

site to become active‎. ‎They had met with the Schostak team to talk about ‎

their priorities‎, ‎what had happened in the past and where they thought the ‎

City could go‎. ‎He claimed that it was a very productive discussion‎. ‎He ‎

found it interesting that less time was spent talking about some of the ‎

brownfield and remediation challenges and more time was spent talking ‎

about efficient ways to tackle the financing‎, ‎and time was of the essence‎. ‎

Schostak had a hard time convincing potential end users that it was a ‎

place to be‎, ‎because they were not sure how Washington or Lansing ‎

might move on brownfield funding‎. ‎SCS put together a couple of ideas ‎

for them‎, ‎and they seemed very receptive as far as how to speed up the ‎

process‎. ‎Mr‎. ‎Kerr felt that if they could somehow speed the financing ‎

process‎, ‎at least in the up front stages‎, ‎it could bring people on board‎, ‎

including the State and Washington‎. ‎Schostak was committed to working ‎

with SCS‎, ‎and the group was making progress‎. ‎

Mr‎. ‎Kerr indicated that they spent a lot of time talking about the PPT‎, ‎but ‎

there was also a wave of momentum behind TIF reform and how DDAs ‎

were funded‎. ‎There were updated bills recently regarding the Zoo and the ‎

DIA millages that included LDFAs‎. ‎That generated statements in ‎

Lansing about economic development reform and what it would mean‎. ‎

There were State reps who had decided that it might be a big issue for ‎

them to take up‎, ‎but they were not quite sure what to do with it‎. ‎SCS had ‎

approached those reps to make them aware that it was of interest to SCS ‎

and to its constituents‎. ‎TIF reform was going to be as relevant as the ‎

PPT‎, ‎perhaps not in the fall‎, ‎but definitely by the first of next year‎. ‎That ‎

also could have an additional impact on the LDFA’s budget‎. ‎SCS had ‎

meetings lined up with some of the State reps‎, ‎and he thought they would ‎

have more information in October‎.‎

Mr‎. ‎Bullard stated that he and Mr‎. ‎Kerr wanted to be proactive about this ‎

issue‎. ‎There was no bill introduced regarding TIF reform‎, ‎but the ‎

discussion had started among the legislators because of the DIA and Zoo ‎

millage issue‎. ‎He and Mr‎. ‎Kerr met with the Chair of the Tax Committee ‎

in the House ‎(‎Representative Farrington‎) ‎to get his thoughts‎. ‎

Representative Farrington told them that he was turning it over to ‎

Representative Eileen Kowall from Oakland County‎. ‎Mr‎. ‎Bullard had ‎

talked with her informally‎, ‎and she had a few thoughts‎, ‎but he believed ‎

that if they got in early and talked with her and other key legislators‎, ‎that ‎

they could hopefully shape their thinking in positive directions‎. ‎Ms‎. ‎

Kowall was term‎-‎limited‎, ‎so she had a year‎-‎and‎-‎a‎-‎half left to work on this ‎

project‎, ‎which she hoped would be one of her legacies‎. ‎She was more ‎

than willing to get input from municipal governments‎, ‎which he felt was ‎

good news‎.‎

Mr‎. ‎Kerr summarized that their line of work for the upcoming year would ‎

be two‎-‎fold‎. ‎One was researching and identifying Federal and State ‎

opportunities that would help the LDFA accomplish some of the ‎

infrastructure goals for the coming year‎. ‎They would also spend a lot of ‎

time monitoring the legislature to see how it decided to move forward on ‎

tax capture authorities and what would happen with the PPT‎. ‎He opened ‎

the floor to questions‎.‎

Ms‎. ‎Golden said that she was very glad SCS was on board‎, ‎especially in ‎

light of the presentation on the potential loss of revenue‎. ‎She asked if ‎

SCS had a website‎, ‎noting that she did web design‎, ‎so it was the first thing ‎

she looked for‎. ‎She had looked for it back when the City was thinking ‎

about partnering with SCS‎. ‎

Mr‎. ‎Kerr clarified that the way the firm was created‎, ‎there were separate ‎

companies in different lines of work‎. ‎Historically‎, ‎the firm spent most of its ‎

time handling Federal affairs‎, ‎and they had a Strategic Federal Affairs ‎

website that focused on the work they did in Washington‎. ‎There was also ‎

Strategic Public Affairs‎, ‎which was the Lansing lobbying advocacy arm ‎

and Strategic Communication Solutions‎, ‎which was the more active ‎

company with Rochester Hills that handled most of the grant writing and ‎

development strategies‎. ‎He believed it was Strategic Communication ‎

Solutions‎.‎us‎.‎

Ms‎. ‎Golden explained that she would like to be able to recommend SCS‎, ‎

because a lot of communities needed help‎. ‎Mr‎. ‎Kerr advised that they ‎

were going through a major restructuring currently in terms of how the ‎

websites would direct to each other‎. ‎He promised to get Ms‎. ‎Golden the ‎

information‎.‎

Ms‎. ‎Janulis said that she appreciated the graphs‎, ‎so they would know ‎

what to expect in ‎2014‎. ‎She was not as panic‎-‎stricken as some in other ‎

communities might be‎, ‎because Rochester Hills was fortunate to still ‎

have some space and room for growth‎. ‎She felt that in the end if the bill ‎

passed‎, ‎it would not be as devastating for the LDFA as perhaps some of ‎

the new legislation might be‎. ‎She would be even more interested in ‎

hearing about the TIF reform and how it might impact the LDFA‎. ‎

Chairperson Slavik commented that the property values in Rochester ‎

Hills were rising again‎. ‎Ms‎. ‎Janulis noted that with Headlee‎, ‎though‎, ‎

things would never get back to what some cities needed‎, ‎but Rochester ‎

Hills was able to adjust‎, ‎and the schools were able to adjust programs‎. ‎

Some communities were already at rock bottom when property values ‎

went down‎, ‎and they were boxed in with no where to go‎, ‎and she was not ‎

sure how it would work out for them‎. ‎She appreciated the information‎, ‎and ‎

pointed out that it gave the LDFA a good planning tool‎. ‎

Discussed

ANY OTHER BUSINESS

Chairperson Slavik asked Mr‎. ‎Davis if he had any road updates‎. ‎Mr‎. ‎

Davis said that he just received an email from the Mayor‎, ‎who was on ‎

vacation in California‎. ‎The Mayor had asked Mr‎. ‎Davis to follow up with a ‎

neighbor who was very unhappy with the Tienken Rd‎. ‎construction‎. ‎The ‎

Road Commission was constructing that project‎, ‎which was broken into ‎

two phases‎. ‎They were currently working between Rochester and Sheldon ‎

Rd‎.‎, ‎and it would be completed this year‎. ‎Next year‎, ‎they would construct ‎

Tienken between Livernois and Rochester Rd‎. ‎That portion would also ‎

include the construction of a dual‎-‎lane roundabout‎. ‎The Road ‎

Commission had not acquired all of the right‎-‎of‎-‎way yet‎, ‎and there were ‎

some agreements that needed to be finalized‎. ‎There were several total ‎

takes‎, ‎including some from homeowners and some from a couple of ‎

businesses‎. ‎

Mr‎. ‎Davis mentioned that participants‎, ‎including Mr‎. ‎Kerr‎, ‎from several ‎

cities had met regarding forming a Water Authority‎. ‎Mr‎. ‎Davis felt that it ‎

was something that could affect the LDFA‎. ‎He recalled that a couple of ‎

years ago‎, ‎the City looked at constructing water reservoirs‎, ‎but it was not ‎

supported in a residential area‎, ‎and Council ultimately decided not to ‎

support it‎. ‎The residents were not necessarily opposed to water ‎

reservoirs‎; ‎they just did not want them built in a residential park area‎. ‎

One of the options that had surfaced was the ability to use the City of ‎

Pontiac’s water reservoirs‎. ‎Orion Township‎, ‎Auburn Hills‎, ‎the City of ‎

Pontiac‎, ‎which was now being overseen by the Oakland County Water ‎

Resources Commissioner‎, ‎and Rochester Hills were looking at the ‎

possibility of forming a Water Authority‎. ‎The purpose was to get the water ‎

rates lower‎. ‎They had met several times‎, ‎and it would either move forward ‎

or not‎. ‎It was getting to the point where they were looking at details such ‎

as how an Authority would be put together‎, ‎who would control it and how it ‎

would be handled by the Detroit Water and Sewer system‎. ‎The timing ‎

was probably good‎. ‎In the fall‎, ‎the City would have a water contract ‎

re‎-‎opener‎. ‎That would set the rate for water purchases throughout the ‎

next five years‎. ‎He added that on the water side‎, ‎there were a couple of ‎

efforts going on‎.‎

Ms‎. ‎Golden asked about sewer‎. ‎She knew that about ‎10 ‎years ago‎, ‎when ‎

she was on City Council‎, ‎there was an editorial that stressed partnering‎. ‎

The rates from Detroit were discussed a lot‎. ‎

Mr‎. ‎Davis said that he just found out two days ago that on the sewer side‎, ‎

the Oakland County Water Resources Commissioner had taken over a ‎

large piece of what used to be Detroit’s Interceptor System‎. ‎On the water ‎

side‎, ‎the City was a tier‎-‎one customer‎, ‎which meant it had a direct contract ‎

with Detroit Water and Sewer‎. ‎On the sewer side‎, ‎the City was a tier‎-‎two ‎

customer‎. ‎It was one step removed from Detroit in that the contract was ‎

with Oakland County‎. ‎Oakland County was taking over the Interceptor ‎

from Detroit Water‎, ‎and there had been a lot of rehabilitation work‎. ‎In the ‎

short term‎, ‎there had been a lot of expense incurred by the City because ‎

the County had bonded out the projects‎, ‎and rates would be affected to ‎

pay for the repairs‎. ‎Detroit probably would have repaired the Interceptors‎, ‎

but Oakland County definitely was‎, ‎and they had moved forward ‎

aggressively‎. ‎Because they had taken over the City of Pontiac’s ‎

infrastructure and the treatment facilities there‎, ‎they were trying to utilize ‎

the sewage treatment facility in Pontiac to a greater extent‎. ‎It was an ‎

under‎-‎utilized asset‎. ‎Oakland County wanted to take more flow than ‎

would normally go in the Clinton‎-‎Oakland system and eventually down to ‎

the Detroit system to be treated and direct it to Pontiac‎. ‎It was felt that if ‎

they took less flow away from the Detroit system‎, ‎over the years it would ‎

be a cost savings‎, ‎because they could treat it more effectively and ‎

cheaply‎, ‎and it would also have a benefit to the environment because the ‎

discharged water from that plant went into the Clinton River‎. ‎The ‎

discharge from the sewage treatment facility actually improved the water ‎

quality of the River‎, ‎so there was great benefit to do that‎. ‎He recently ‎

learned that the effort to try and do a couple of the capital improvement ‎

projects to make that happen was kind of thwarted by the City of ‎

Rochester‎. ‎All the Clinton‎-‎Oakland communities had a contract that ‎

would expire in ‎2017‎, ‎but Rochester’s went to ‎2024‎. ‎Rochester did not ‎

want to enter into a new contract‎. ‎Either the remaining communities would ‎

pull out and form a new contract separate from Rochester’s‎, ‎or the ‎

projects would just be delayed‎. ‎On the water and sewer side‎, ‎there were ‎

efforts being done to try to save money‎, ‎short‎-‎term and long‎-‎term‎.‎

Chairperson Slavik asked Mr‎. ‎Davis how the discharge out of the ‎

treatment plant would enhance the water quality of the Clinton River‎. ‎

Mr‎. ‎Davis assured that it was treated‎, ‎and the treated water at the end was ‎

of pretty good quality‎. ‎The Clinton River at times suffered from not ‎

having much volume‎. ‎A greater volume flowing through the River was ‎

better for water quality‎. ‎When there were big storms‎, ‎the River raged‎. ‎

There would be more dissolved oxygen added into the water‎, ‎and that was ‎

good for some of the fish‎. ‎He did not have all the particulars‎, ‎but it was ‎

what he had been told‎, ‎and he believed it‎. ‎

Chairperson Slavik knew that there was a commission working to try to ‎

increase the flows and stabilize them through the summer low months‎.‎

Mr‎. ‎Davis agreed‎, ‎and said there were a series of weir systems‎. ‎It was a ‎

complicated balance‎, ‎because there were lake owners that wanted to ‎

maintain a certain level at their lake‎, ‎but sometimes in order to do that‎, ‎it ‎

was at the expense of the flow downstream in the River‎. ‎At times‎, ‎the ‎

River got pretty low‎. ‎About three years ago‎, ‎during the Paddlepalooza on ‎

the Clinton River‎, ‎many areas needed portages because the level was so ‎

low‎. ‎With the treatment facility discharging‎, ‎he felt there would be a better ‎

ability to maintain some river flow at a higher level‎, ‎and it would also ‎

make the lake levels higher‎.‎

Regarding road projects‎, ‎Mr‎. ‎Davis advised that there were a number ‎

going on‎. ‎One that would start soon was Firewood and Falcon between ‎

Walton and Tienken‎. ‎It would be a reconstruct‎, ‎and it would probably start ‎

at the beginning of August‎. ‎He advised that it was going to Council on ‎

July ‎15‎th‎. ‎Another project starting on July ‎15‎th was Livernois between ‎

Harding and New Life Lane‎. ‎The joints needed repair‎, ‎and there would be ‎

some slab replacement‎. ‎It was a project that was wrapped into the Local ‎

Concrete Slab program‎, ‎and it was coordinated with the Road ‎

Commission‎. ‎The City was able to take advantage of an additional ‎

source of funding through tri‎-‎party‎. ‎Because Rochester Hills was in a ‎

good position and had monies in its road fund balances‎, ‎it could afford ‎

the City’s share and take advantage of monies other communities were ‎

not able because they were so strapped‎. ‎At the same time as the ‎

Livernois project‎, ‎they would go forward with the Local Slab Replacement ‎

program‎. ‎That would include LDFA roadwork repair for which they had ‎

budgeted ‎$‎300‎k the last few years‎. ‎He believed they would start in ‎

subdivisions and towards the later end of the project move to the LDFA ‎

area‎.‎

Mr‎. ‎Davis noted that there was some work proceeding by Adams Road ‎

Marketplace‎. ‎They had a pre‎-‎construction meeting for the Holiday Inn ‎

Express‎. ‎There was also a bank going in there‎. ‎One disappointment was ‎

that Tienken Rd‎. ‎between Adams and Brewster‎, ‎which was one of the worst ‎

sections of roads in the City‎, ‎was not scheduled for repair‎. ‎The City was ‎

working with the Road Commission to try and identify a funding source to ‎

move that project forward‎. ‎At the earliest‎, ‎they had applied for ‎2016 ‎

funding for that section‎, ‎but it did not get selected‎. ‎The City would submit ‎

for ‎2017‎, ‎which was really far off‎. ‎It might be possible that the City would ‎

advance funds to repair it‎, ‎and they would propose that to Council‎. ‎His ‎

Staff was going to work with the Road Commission to get an overlay or ‎

something done‎. ‎He concluded that he received the most complaints ‎

about that section of road‎.‎

Ms‎. ‎Janulis asked if any traffic lights were proposed‎, ‎and she mentioned ‎

Adams and Butler‎. ‎Mr‎. ‎Davis thought that would probably not happen‎. ‎

The hold up had been the portion of Butler in Auburn Hills‎, ‎which was ‎

gravel‎. ‎He thought that if it were paved‎, ‎it might meet signal warrants‎. ‎

There was not enough traffic currently that warranted the installation of a ‎

traffic signal there‎. ‎Mr‎. ‎Davis mentioned that a more likely signal that was ‎

moving forward was on Rochester Rd‎. ‎with the possible realignment of ‎

Drexelgate and Eddington Blvd‎. ‎There had been some discussion at the ‎

Council level with the developer‎. ‎There were some people in the ‎

Eddington subdivision that were opposed‎, ‎and they would prefer to see a ‎

signal at Yorktowne and Meadowfield‎. ‎The City tried to get a light ‎

installed there‎, ‎and it was the purpose of realigning that section of ‎

roadway‎, ‎and there was a development going in on Meadowfield ‎(‎a senior ‎

housing development‎)‎, ‎which would increase traffic trips‎. ‎Out of the two‎, ‎

however‎, ‎he felt that Drexelgate and Eddington had a better chance for ‎

success‎, ‎and MDOT agreed‎.‎

Ms‎. ‎Janulis asked if any were planned for the LDFA area‎. ‎Mr‎. ‎Davis ‎

related that there were no traffic signals planned‎. ‎He mentioned the ‎

roundabout at Livernois and Tienken‎, ‎and said that it would have a hawk ‎

signal‎. ‎That was pedestrian actuated to allow pedestrians to cross‎, ‎and it ‎

would be different than the City had at any of the other roundabouts‎. ‎With ‎

the Paint Creek Trail and higher pedestrian movements at the ‎

intersection of Tienken and Livernois‎, ‎they felt it would be good to have ‎

one at that location‎.‎

Mr‎. ‎Anzek thanked Mr‎. ‎Bullard and Mr‎. ‎Kerr for attending‎, ‎and ‎

Chairperson Slavik added that he was glad they were on board so they ‎

had a bigger presence in Lansing‎.‎

NEXT MEETING DATE

Chairperson Slavik reminded the LDFA Board that the next Regular ‎

Meeting was scheduled for October ‎10‎, ‎2013‎.‎

ADJOURNMENT

Hearing no further business to come before the LDFA Board‎, ‎and upon ‎

motion by Janulis‎, ‎seconded by Boyd‎, ‎Chairperson Slavik adjourned the ‎

Regular Meeting at ‎8‎:‎34 ‎a‎.‎m‎.‎

Respectfully Submitted‎,‎

_____________________________ ____________________‎

Stephan Slavik‎, ‎Chairperson Maureen Gentry‎

Rochester Hills Recording Sec‎'‎y‎.‎

Local Development Finance Authority‎