MINUTES OF THE SPECIAL COMMUNITY REDEVELOPMENT AGENCY MEETING OF NOVEMBER 29, 2004, AT 3:00 P.M. PRESENT: Chair Richard F. Martin, Vice Chair Mary Anne Servian, Members Fredd "Glossie" Atkins, Danny Bilyeu, and Lou Ann R. Palmer, Executive Director Michael A. McNees, Secretary Billy E. Robinson, and Attorney Robert M. Fournier ABSENT: None PRESIDING: Chair Martin Chair Martin called the Special meeting of the Community Redevelopment Agency (CRA) to order at 3:00 p.m. Secretary Robinson gave the Invocation followed by the Pledge of Allegiance. 1. APPROVAL RE: MINUTES OF THE SPECIAL COMMUNITY REDEVELOPMENT AGENCY MEETING OF NOVEMBER 1, 2004 - APPROVED (AGENDA ITEM CRA-1) CD 3:06 Chair Martin asked if the CRA has any changes to the minutes of the November 1, 2004, Special CRA meeting? Chair Martin stated that hearing no changes, the minutes of the November 1, 2004, Special CRA meeting are approved by unanimous consent. 2. REPORT RE: : STATUS AND THE NEGOTIATIONS WITH THE ERSA GRAE CORPORATION, THE GOLDEN APPLE DINNER THEATRE AND THE SARASOTA OPERA CONSENSUS THE PROCESS IS MOVING FORWARD AND TO RECEIVE REGULAR STATUS REPORTS FROM STAFF, AND A MORE DETAILED PRESENTATION AT THE JANUARY 2005, JOINT MEETING OF THE CRA AND THE CRA ADVISORY BOARD / ONCE SCHEDULED (AGENDA ITEM CRA-2) CD 3:07 through 4:21 Chair Martin stated that the item concerns the status and the negotiations with the Ersa Grae Corporation (Ersa Grae), the Golden Apple Dinner Theatre (Golden Apple) and the Sarasota Opera (Opera); and requested that Staff come forward. BOOK 2 Page 1545 11/29/04 3:00 P.M. BOOK 2 Page 1546 11/29/04 3:00 P.M. Karin Murphy, Redevelopment Specialist, Planning and Redevelopment Department, came before the CRA; and stated that the purpose of the item is to provide a status report regarding the public/private partnership with Ersa Grae; that on September 28, 2004, the CRA held a special meeting to receive a status report regarding the negotiations between the Developer, the Golden Apple, and the Opera; that during discussions, the CRA requested Ersa Grae to report back to the CRA after 60 days; that in addition, at a subsequent CRA special meeting held on October 18, 2004, the CRA approved a motion to express no objection to a Confidentiality Agreement between Ersa Grae and the Golden Apple with the stipulations as stated by both parties and outlined in the Agenda backup material; that the 60 day time period has expired and Ersa Grae will present the status of the negotiations; that assuming a satisfactory report, no action by the CRA is necessaryi that Staff would proceed with crafting a redevelopment agreement for both the CRA Advisory Board and the CRA to review; that the Applicants will come forward and provide the status report. Ali Ebrahimi, Principal of the Ersa Grae Corporation, and Charles Bailey Jr., Attorney, law firm of Williams, Parker, Harrison, Dietz & Getzen, Counsel for Ersa Grae, came before the CRA. Attorney Bailey stated that a November 29, 2004, letter signed by Mr. Ebrahimi and Robert Turoff, the owner of the Golden Apple Dinner Theatre is being provided to the CRA and is being submitted into the record at this time; and quoted the letter as follows: We are pleased to inform you that we have executed a Term Sheet with the Golden Apple Dinner Theatre dated November 29, 2004. The Agreement requires certain zoning variances which we contemplated in our original proposal submitted to the City regarding parking requirements and use limitations in the new Downtown Code. Attorney Bailey quoted a November 29, 2004, letter to the CRA signed by Edward Bavaria, Chair, Board of Directors, Sarasota Opera, and Mr. Ebrahimi, regarding a 60 day progress report concerning the Plaza Verdi development as follows: At the September 28, 2004, CRA meeting, a 60 day extension of the deadline for Ersa Grae to reach terms with the Sarasota Opera and the Golden Apple was granted. As of November 29, 2004, the Opera and Ersa Grae have made progress but no binding Term Sheet has been signed. As optimistic as we are about the project and the exciting opportunities it offers for all parties involved, it is the duty of the Opera's Chairman of the Board and the duty of his fellow trustees to ensure that the future vitality of the Opera is not being put in jeopardy. While we are slowed by a cautious approach, we are confident that the time is well spent as much is at stake for the Opera. We are certain that the CRA is also aware of the resources necessary in determining the feasibility of such a major project. While all efforts are being made, it bears remembering that the Opera has limited Staff and monetary resources available to expedite the process. We are pleased to report that in the last 60 days, the Opera's architect has completed a massing study illustrating how the Opera's needs could be met using the space provided within the Plaza Verdi. This plan was reviewed by select Opera Staff and Board members and discussed with Ersa Grae. The conclusion drawn from the study was as follows: The Plaza Verdi project is still viable but the Opera will need to expend $10 million or more on its existing property to allow the construction of necessary spaces which will not fit in the space within the Plaza Verdi project. To ensure that the Opera is not exposing itself to undue risk, the following basic contingencies have been agreed upon in principle: 1. The Opera construction is to be built concurrent with Phase I of Plaza Verdi. 2. Allowance for funds to be raised by the Opera on a feasible time line. 3. Plans will be made to ensure there will be minimal interruption of the Opera's operations, e.g., no lost performances, available temporary parking, etc. 4. Understanding that if certain design specifications on elements vital to the future operation of the Opera, such as loading docks, are not met, the Opera cannot enter into the project in good conscience. BOOK 2 Page 1547 11/29/04 3:00 P.M. BOOK 2 Page 1548 11/29/04 3:00 P.M. Ersa Grae and the Opera are hopeful that with the cooperation of the City, these issues can be worked out in detail during the process of finalizing various agreements between the City, Ersa Grae, the Sarasota Opera Association and the Golden Apple. Attorney Bailey stated that Opera representatives are present in the Chambers and would like to speak. Chair Martin stated that hearing from the Opera representatives is supported. Member Palmer agreed. Mr. Ebrahimi stated that the Opera's consultants and planners have developed an ingenious scheme which meets the Opera's requirements, which are more than originally anticipated, while keeping the Ersa Grae portion of the project viable; that the issue is complex; that originally, the Opera was being provided all the space in Phase I; that the Opera's space will now be part of Phase I and Phase II, requiring more complex negotiation, discussions, and work to make the project viable, which is the reason for not coming forward with a signed Term Sheet at this time. Chair Martin asked for clarification regarding the Opera's improvements which will now be constructed during both Phase I and II. Mr. Ebrahimi stated that originally, all of the needs of the Opera would have been constructed during Phase I of the project, which was being done in exchange for the Opera's providing the land to Ersa Grae; that under the new arrangement, the Opera will be provided all requested needs during Phase I as well as being provided some portion of the Opera's needs in Phase II; that once Phase I is complete, the work regarding the Opera will still not be complete; that some concurrent construction will take place both in Phase I and Phase II. Chair Martin stated that the first contingency in the November 29, 2004, letter, signed by the Opera and the Developer, indicates the Opera construction will be built concurrent with Phase I of the Plaza Verdi project which seems conflicting with the information being provided by Mr. Ebrahimi at this time. Mr. Ebrahimi stated that the contingency indicated is correct; that Mr. Bavaria will provide an explanation. Vice Chair Servian stated that the comments indicated by Mr. Ebrahimi are different than the first contingency outlined in the letter; that waiting until the Opera representatives speak will be prudent to ensure everyone has the same understanding of the issue; that issues such as loading docks, etc., are common considerations during construction. Mr. Ebrahimi stated that the drawings of the Opera's consultant were reviewed; that two or three minor comments resulted from the review; that the concept in the drawing works; that he was impressed by the competence of the concept which is nicely done; that everyone will be pleased. Member Palmer stated that a contradiction exists in the November 29, 2004, letter signed by the Opera and Ersa Grae; that the letter indicates the Opera's architect has completed a massing study illustrating the manner in which the Opera's needs could be met using the space provided within the Plaza Verdi project; that the next paragraph indicates the project is still viable but the Opera will need to spend additional dollars on its existing property to allow construction of necessary space which will not fit in the space of the Plaza Verdi project. Mr. Ebrahimi stated that the Opera is making changes to its space which does not involve the Plaza Verdi project; that the changes provide more capacity in terms of stage; that the present stage will be expanded and another stage will be added. Member Palmer stated that the understanding is the Language is not conflicting; that the Opera is making changes on a portion of the project which are in addition to the changes resulting from the collaboration with Ersa Grae. Mr. Ebrahimi stated that no conflict exists between Ersa Grae and the Opera; that the language is not meant to appear conflicting. Attorney Bailey stated that Member Palmer was not concerned with conflict between the Opera and Ersa Grae; that the concern is regarding conflict between the language and the comments being BOOK 2 Page 1549 11/29/04 3:00 P.M. BOOK 2 Page 1550 11/29/04 3:00 P.M. heard at this time; that the situation will be clear once the representatives of the Opera come forward to speak. Edward Bavaria, Chair, Board of Directors, Sarasota Opera, came forward and stated that a great deal of work will be performed by the Opera in addition to the work which will be performed by Ersa Grae; that the Opera is facing a large task; that little improvement has been made to the Opera building over the last 20 years; that a good job was performed initially; however, spending some money on the facility is now necessaryi that his job is to assure the plans developed provide for the future of the wonderful Opera companyi that the projects anticipated by the Opera which go beyond the improvements being made by Ersa Grae involve the extension of the fly tower behind the Opera building and additional storage area at stage right of the Opera building; that massive work will be conducted inside; that new seats will be added; that all the systems will be replaced, particularly the air conditioning systems; that the Opera building currently has 24 air-conditioning systems; that reducing the number of systems substantially is desired. Mr. Bavaria continued that the opportunity is to spend approximately $10 million; that a capital campaign launch is planned shortly; that the hope is to raise the necessary funds to perform all the work; that obviously, a risk is involved; that the risk must be evaluated; that the Opera cannot exist as a company and lose a performance season; that an Opera company cannot sustain itself without having a season; that the phasing of the development must be consistent with Ersa Grae sO a season is not lost; that the pavilion facility rearward of the current Opera house is being constructed in sufficient time for use by the Opera; that otherwise the Opera will have no place to rehearse; that the Opera is dedicated to making the project a success; however, the project cannot be launched to the detriment of the Opera; that the project must be seen as a benefit for the Opera and Ersa Grae; that the City will also receive the benefit. Vice Chair Servian stated that the Opera must perform significant improvements which are outside the scope of the project before the CRA; that optimism is not heard but is considered critical; that the CRA must believe the Opera is optimistic in moving forward and the project can be accomplished; that the long term viability of the Opera is important; and asked if the Opera will be able to come to agreement with Ersa Grae and move forward? Mr. Bavaria stated that the four contingencies regarding the partnership were identified; that the hope is the four issues will be resolved sO the process can be successful; that the Opera is committed to the space once agreement is reached with Ersa Grae; that the Opera will not be able to relocate; that having people in the community question his decision five years in the future is not the desire. Vice Chair Servian referred to the second of the four contingencies regarding the allowance for funds to be raised by the Opera on a feasible time line; and asked the manner in which the contingency fits into the agreement with Ersa Grae? Mr. Bavaria stated that the issue was discussed with Ersa Grae earlier in the day; that a time line which will permit the best opportunity to raise the necessary funds is desired; that the issue has not yet been resolved; that unhappily, the Opera company has an extremely modest endowment; that a greater endowment is necessary due to the size of the Opera; that the Opera can likely work with Ersa Grae to develop a schedule of the Developer's construction of the project consistent with the Opera's requirements to raise funds. Member Palmer stated that the first contingency indicating the Opera construction will be concurrent with Phase I of the Plaza Verdi project seems conflicting with the current presentation; that Mr. Ebrahimi indicated the Opera construction will be performed during Phase I and Phase II; and asked if a contradiction exists? Mr. Bavaria stated no; that the understanding is Phase I will ensure the Opera has a replacement pavilion once the current pavilion is abandoned; that in addition, the funds are necessary to construct the extension of the orchestra pit as well as to raise and increase the width of the fly tower; that the construction must take place during a certain phase to ensure the Opera does not lose a season and must be performed at a time funds are available to pay for the construction. Member Palmer asked if the second contingency is a contradiction to the comments indicated by Mr. Ebrahimi which were an BOOK 2 Page 1551 11/29/04 3:00 P.M. BOOK 2 Page 1552 11/29/04 3:00 P.M. agreement exists to construct the improvements over two phases rather than one. Mr. Bavaria stated no. Member Palmer stated that the predicament of the Opera to commit to the project is understood; that the Opera Board must review the situation carefully; however, the CRA has agreed to negotiate with the Developer; that the Golden Apple portion of the project has come to fruition; that the CRA is waiting for a response from the Opera; that part of the agreement, initially, was for the construction of the facilities for all three parties in the project; that in fairness to Ersa Grae, some commitment in terms of time is necessary; that the CRA desires some commitment as well sO the agreement can be finalized and the project can move forward; that a time line or some kind of statement as to the length of time necessary for negotiation are necessaryi; that the CRA needs to move forward with the project which does not place the Opera in the most comfortable position; that the CRA is on a time line as well; that having the parking spaces included in the project operational is the desire; that Ersa Grae desires to move forward as does the Golden Apple and the Opera; and asked for an overview of the potential time line? Mr. Bavaria stated that a time line cannot be suggested at this time; that doing sO would be imprudent and disingenuous; that the Opera must work extremely hard with Ersa Grae to ensure all the Opera's requirements for space, a construction schedule, and funding time lines are soundly met; that the Opera will do the best job possible to make certain the requirements are met; that the intent is to ensure a cooperative demeanor between both parties; that the belief is a cooperative demeanor exists; that the Opera season is forthcoming, which requires significant work; that operating an Opera company requires significant preparation and work. Vice Chair Servian stated that the November 29, 2004, letter to the CRA from the Opera indicates the Opera's limited resourcesi that Mr. Bavaria indicated the Opera is working extremely hard to bring the agreement with Ersa Grae to fruition; and asked if the CRA or the City can provide any assistance to bring the agreement to closure sooner rather than later? Mr. Bavaria stated that having the CRA and the City available to assist, if necessary, is desired. Chair Martin asked if a time line has been established regarding capital campaign expectations? Mr. Bavaria stated that normally capital campaigns run for several years; that the intention is to have the silent phase of the capital campaign begin within the next month or two; that the capital campaign would then continue; that the hope is to obtain at least 40 to 50 percent of the commitments to the capital campaign made during the period, which is typical. Member Atkins asked the relation of the capital campaign to the City, the Opera, and Ersa Grae? Mr. Bavaria stated that the capital campaign will permit the Opera to perform all the work required to upgrade the Opera house complex, which must be performed consistent and phase in neatly with all the work performed by Ersa Grae; that the work must be performed at the same time; that significant work will be performed; that extending the construction over many years is not the desire; that the construction must take place in a phased manner consistent with Ersa Grae's work. Member Atkins stated that the Opera's fundraising process seems related to the construction time line; that the issue seems as though the burden of the project is for the Opera to determine the length of time necessary to raise $10 million. Mr. Bavaria stated that the Opera must raise the moneyi that a risk is involved; that significantly more construction such as the extension of the orchestra pit, and increasing the height and the depth of the fly tower will occur at the time Ersa Grae replaces the Opera's pavilion with another pavilion immediately rearward of the Opera house. Member Atkins stated that the construction process has been known and expected. Mr. Bavaria stated that the thought was coinciding the Opera improvements with the Ersa Grae project would be ideal. Member Atkins stated that the Opera is basically taking advantage of the opportunity; that the project must move BOOK 2 Page 1553 11/29/04 3:00 P.M. BOOK 2 Page 1554 11/29/04 3:00 P.M. forward; and asked if the Opera is going to hold up the project until $10 million is raised? Mr. Bavaria stated no; that the Opera will have to take the risk of moving ahead. Member Atkins stated that the expressed willingness to take the risk to move ahead is appreciated and is desired. Member Palmer stated that the CRA desires the partnership between the Opera, the Golden Apple and Ersa Grae; that the partnership was the reason several of the CRA members voted in favor of the project; that having all three parties work together is important; however, the City desires to have the parking spaces developed; that the partnership with Ersa Grae and the Golden Apple is apparently in place; that the CRA must be made aware if the Opera believes moving forward is too much of a risk; that the CRA must determine the desired direction if the Opera considers moving forward a risk; that the Opera should determine if being a partner in the project is no longer viable sO the CRA, Ersa Grae and the Golden Apple can perhaps move forward; that the CRA must move ahead; that the CRA has informed Mr. Ebrahimi of the desire to include all the parties in the project; that the Developer is being placed in an awkward position; that the CRA has indicated the Ersa Grae project must include the Opera and the Golden Apple if the project is to move forward; that the CRA is anxious for the project to move forward; that the manner in which the CRA can be receptive to the Opera but at the same time have a time line to make a definitive determination is necessary; that a balance which is fair to all parties must be identified; that the CRA must be made aware if the Opera is not ready, willing or able to come together with the other partners in the project. Mr. Bavaria stated that issues beyond the Opera are involved; that for some time, the understanding was coming to terms with the Golden Apple was difficult; that the issues with the Golden Apple have been resolved; that the focus is now on the Opera; that two parties are involved in addition to Ersa Grae which are the Opera and the Golden Apple; that the Opera is not the only party holding up the project; that the Opera and the Golden Apple have not been able to reconcile needs versus improvements which will be provided by Ersa Grae; that apologies for the position of the Opera are not being extended; that the CRA undoubtedly desires to preserve the Opera; that the Opera is a significant cultural performing arts concern in the area; that he is not a developer and has no idea of construction; that his experience is with operational issues; that the responsibility is significant and difficult especially at his age of 72; that the Opera will move forward immediately if determined prudent; that Ersa Grae will be cooperative; that the Opera desires to move forward which is the reason for offering the improvement of the pavilion; that the pavilion and the Golden Apple will provide a nice footprint for developing property on the tax roll; that the existing pavilion is not considered adequate; that the agreement is for Ersa Grae to construct a replacement facility to the Opera's specification, which is much better than presently exists; that methods will be identified to accommodate each other regarding the other contingencies; that an agreement will be reached. Chair Martin stated that the struggle is a time line has not been established; that the CRA is in a difficult position without having a definitive time line. Member Bilyeu asked if moving forward would be a problem if the Opera had $10 million? Mr. Bavaria stated that the discussion would be regarding space and the construction time line if the Opera already had $10 million; that $10 million will not be sufficient for all the improvements. Vice Chair Servian stated that the Opera should be able to resolve the following three of the four contingencies with Ersa Grae quickly: 1. The Opera construction is to be built concurrent with Phase I of Plaza Verdi. 3. Plans will be made to ensure there will be minimal interruption of the Opera's operations, e.g., no lost performances, available temporary parking, etc. 4. Understanding that if certain design specifications on elements vital to the future operation of the Opera, such as loading docks, are not met, the Opera cannot enter into the project in good conscience. BOOK 2 Page 1555 11/29/04 3:00 P.M. BOOK 2 Page 1556 11/29/04 3:00 P.M. Vice Chair Servian continued that the three items will truly require the cooperation of Ersa Grae and the Opera; that Ersa Grae's commitment to the three items should be provided sO the CRA will gain an understanding of the time line; that the Opera likely feels pressured at this time; however, the time line is extremely important to the CRA; that the CRA has been waiting for years for construction of a project which will provide the public parking desperately required in the area; that the second contingency regarding an opportunity for the Opera to have a feasible time line to raise the necessary funds causes some reservation; that the manner in which Ersa Grae can be held responsible for an allowance in time for the Opera to have the ability to raise funds is not seen; that the CRA cannot request Ersa Grae to delay the project for the Opera to raise money if a redevelopment agreement is established and permits are obtained to begin construction; that the Opera will be taking a risk; that the risk involves all the parties; that the CRA is taking a risk by moving forward with the project since something could occur causing the project to fail; that two other projects were previously proposed which did not come to fruition. Susan Danis, Executive Director, Sarasota Opera, came before the CRA; and stated that fundraising is part of the concern; that some points made will be clarified; that the issues concerning the Opera's additional expenditures and the fundraising need are generated by the extremely specific, defined opportunity to provide for the future of the Opera; that the manner in which the Opera will provide for its future will be determined by the time line followed by the Plaza Verdi project; that any construction to prepare the Opera for 20 years in the future must take place now; that the fundraising needs the Opera may have been anticipating over the next 20 years will be fast tracked to the time line of the Plaza Verdi project, which is the reason for including the second contingency allowing the Opera to raise the funds on a feasible time line; that the Opera has significantly more fundraising to accomplish in a shorter period of time than originally anticipated; that the Opera would be remiss if not indicating the concern regarding fundraising; that the Opera desires being part of the Plaza Verdi project; that moving the project forward is the intent; that the Opera has a plan and has been working with capital campaign consultants; that a feasibility study was conducted at the beginning of 2004; that the results of the study indicate the fundraising goals can be accomplished; however, nothing is definitive. Ms. Danis continued that in theory, the Opera has both written and verbally pledged amounts towards the campaign, which is promising; that once development goes up around the Opera house, the Opera's footprint is established; that the Opera will no longer have an opportunity to purchase the building next door and attempt to grow as an Opera companyi that the Opera has had to determine needs 20 years into the future and the manner in which the physical property will allow the Opera to meet its future needs; that the determination has been made with great care and excellent cooperation from Ersa Grae; that the Opera's and Ersa Grae's architects have worked diligently together; that both architects have developed extremely creative solutions; that the Opera has proceeded through the most difficult portion of negotiations; that the details of the Term Sheet are being discussed simultaneously with conducting the capital campaign and attempting to ensure the funds are in place sO the Opera can be a viable and responsible partner. Vice Chair Servian stated that Ms. Danis indicated the Opera would be remiss if not indicating the concern regarding the necessity to raise funds; and asked if the issue concerning fundraising is a concern or a contingency for the project to move forward? Ms. Danis stated that the answer would depend upon the manner in which the terms concern and contingency are defined. Vice Chair Servian stated that the deal fails if the contingency does not take place. Ms. Danis stated that for the Opera to embark upon the project without $20 million in the bank is a concern since a $20 million project cannot be debt financed; that perhaps some of the project could be debt financed; that a significant amount of real estate will be available for development on Pineapple Avenue if the Opera fails to succeed, which is not the goal; that the Opera has been part of the lives of Sarasotans for decades; that the intent is to contribute $20 million into improvements on the physical property to make the theater and the rest of the Opera complex remain in the City for future generations of Sarasotans; that the issue concerning fundraising is a contingency since the Opera has not received even $10 BOOK 2 Page 1557 11/29/04 3:00 P.M. BOOK 2 Page 1558 11/29/04 3:00 P.M. million of signed pledges, which is a concerni that the feasibility study indicated the Opera can raise at least $18 million which will not assist the Opera with endowment goals but will assist with the actual, physical build-out. Vice Chair Servian asked the time frame? Ms. Danis stated that the Opera is working as fast as possible; that the silent phase of fundraising has begun; that gifts and pledges toward the endowment portion have already been received; that the hope is to receive more cash since endowments will not pay for construction; that trips have been taken consistently to Chicago, Illinois, New York, and other cities to visit the Opera's patron group; that the images of Plaza Verdi are used while visiting the Opera's patron group. Vice Chair Servian asked the length of time necessary to provide sufficient confidence the Opera will meet its ultimate fundraising goal sO the CRA will have the knowledge the project will move forward? Ms. Danis stated that fundraising is a processi that a definitive time cannot be provided; that the Opera's proposed time line for the capital campaign was three years; that most of the large gifts come at the beginning of the capital campaign; that a good idea of the funds which will be received will be available by the time the end of the Opera season is reached in March or April of 2005. Vice Chair Servian stated that the Opera will know if the goal is realistic by the end of February 2005 or early March 2005; that the understanding is until the time, the Opera cannot move forward with an agreement with Ersa Grae; that the understanding is entering into an agreement without having the knowledge as to the amount of funds which will be received through the capital campaign would not be prudent. Chair Martin stated that the Opera will not have the information for four or five months. Vice Chair Servian agreed. Ms. Danis stated that many of the issues involved with reaching an agreement between the Opera and Ersa Grae are taking place simultaneously, that being more definitive is desired; that the Opera could move forward if a $5 million gift were presented tomorrow; that some projects can move forward if closing on a substantial gift were presented tomorrow; that other work can continue over the next few months sO the project will move forward. Chair Martin stated that the Opera also has concerns with limited Staff, monetary resources and the upcoming Opera season; and asked if the Opera has time to fast track the agreement with Ersa Grae? Ms. Danis stated that the Opera has designated consultants and Staff who work solely on the capital campaign; that the Opera is skilled at conducting capital campaigns; that future development of the Opera. is a different learning curve since not conducted as a regular part of business; that the Opera does not know if the Plaza Verdi project is moving forward which creates a problem while performing fundraising; that someone may wish to have their name on the fly tower for a $2 million contribution; that she could be selling a naming opportunity which might not exist if the project does not move forward; that the Opera must have a product to sell; that people will not contribute without a reason; the people must be aware of the future direction of the Opera. Member Palmer stated that a commitment existing on the part of the Opera to address the other basic requirements regarding the fly tower, etc., will assist in fundraising since people will actually be aware of an agreement which is moving forward with momentum. Ms. Danis agreed. Member Palmer stated that the question of the project's moving forward is also a part of the Opera's risk; that the Opera's commitment to address the other basic requirements will help everyone move forward more quickly; that the level of uncertainty is the CRA's concerni that the CRA desires to have the project move forward quickly, i.e., as soon as possible; that the project cannot move forward until all the pieces are essentially in place; that the Opera is encouraged to establish a realistic time line and to work out the other issues, which do not seem major, with Ersa Grae. BOOK 2 Page 1559 11/29/04 3:00 P.M. BOOK 2 Page 1560 11/29/04 3:00 P.M. Ms. Danis agreed; and stated that the other issues are not major. Member Palmer stated that receiving a definitive time in which the project will move forward or not is desired; that the CRA will have to make a decision; that the CRA desires construction of the parking structure and other portions of the project to move forward; that the opportunity to bring the Opera and the Golden Apple into the Ersa Grae project with all the associated amenities plus the public parking is wonderful; that the City is in dire need of public parking. Chair Martin requested that Staff come forward. Karin Murphy, Redevelopment Specialist, Planning and Redevelopment Department, came before the CRA and stated that Bruce Franklin, President, Land Resource Strategies, Inc., will join her on part of the discussion; that a number of meetings have been held with the Opera; that the Opera does not have experience with development; that bringing the Opera into the development process is favorably anticipated; that Staff's goal was to remain aware of the extremely restrictive parking easement which belongs to the Opera while enabling the, long term vision of the Opera; that Staff had to ensure Term Sheets were developed to move forward with the next step; that Staff will begin the difficult work of scheduling and conducting project team meetings if the report is found satisfactory; that the project schedule which is the first step will be developed; that the project schedule would provide the Opera with a clearer understanding of the status of the Plaza Verdi project; that the project schedule and results of the project team meetings can be reported back to the CRA sO the goals of the Opera and Ersa Grae can be coordinated; that Staff anticipated bringing a redevelopment agreement to the CRA in January 2005, which is no longer realistic; that the redevelopment agreement will be complex; that Staff is more likely to come back with a draft redevelopment agreement, the project schedule, and an update from the Opera regarding the status of the capital campaign in March 2005; that the City still has considerable issues regarding the property to address prior to conveying the property; that the Opera Parking Agreement must be finalized; that more environmental assessment work is required as well; that the environmental assessment should be fine. Attorney Fournier stated that two sets of conditions precedent are included in the Term Sheet; that items are listed which are conditions precedent to the execution of the redevelopment agreement; that items which are conditions precedent to the closing and the actual transfer of the property from the City to the CRA and then from the CRA to Ersa Grae are also listed. Mr. Franklin came before the CRA and stated that the CRA should not assume an absence of information until April 2005; that the Developer will come back to the CRA to provide the status of the negotiations concerning the project with the Opera; that the Developer has many obligations toward the resolution of the redevelopment agreement with the City and toward resolution of the City's obligations concerning the terms precedent; that for the Opera to work for the next few months toward producing the best season ever to attract the biggest donor pool possible is supported so a positive report can be provided to the CRA; that work with the Opera's architect is being conducted; that contingencies one, three, and four are not significant and are typical issues which will be resolved during the design, planning, development and construction process; that he is confident regarding resolution of the second contingency concerning an allowance for fundraising by the Opera on a feasible time line; that Mr. Bavaria who is sitting as Chair of the Opera Board cannot be as confident; that he has observed people raise $10 million in the City for significantly less interesting projects than the Opera; that the CRA is urged to allow the management and scheduling of the process to continue to move forward; that the negotiations taking place thus far with the Golden Apple and the Opera are pleasing. Vice Chair Servian stated that the draft redevelopment agreement would likely come before the CRA in March 2005; that the anticipated schedule to begin construction, assuming the redevelopment agreement is approved, is requested. Mr. Ebrahimi came forward and stated that construction would begin in 15 months assuming the redevelopment agreements between all parties are signed. Vice Chair Servian stated that the estimated date would be August 2006; and asked if the Opera could perform its season in the new structure if construction commences in the summer of 2006? BOOK 2 Page 1561 11/29/04 3:00 P.M. BOOK 2 Page 1562 11/29/04 3:00 P.M. Mr. Ebrahimi stated that the situation has been carefully reviewed; that an important aspect for the Opera is to avoid losing a season; that the project will be planned in such a manner sO as to not lose a season. Vice Chair Servian stated that scheduling the project to assure the Opera does not lose a season addresses the third contingency regarding the request for plans to ensure minimal interruption of the Opera's operations, e.g., no lost pertormances, available te emporary parking, etc., as well as the first contingency regarding the construction related to the Opera being concurrent with Phase I of Plaza Verdi. Mr. Franklin agreed. Mr. Ebrahimi stated that the fourth contingency indicates the Opera cannot enter into the project in good faith if certain design specifications for elements vital to the opera's future operation, which means Ersa Grae must review the Opera's plan; that the Opera's plan is two-fold; that the first portion of the plan involves what the Opera will do with the space provided by the Developer and the timing of the improvement; that the second portion of the plan involves the future plans for the Opera's own space; that the first set of drawings was received 10 days ago; that he was extremely encouraged with the drawings; that studies have not yet been conducted to determine the possibility of separating the two portions of the plan sO one can move forward at a faster pace and one can move forward at a slower pace; that Ersa Grae's and the Opera's drawings will be reviewed over the next 30 or 40 days to determine if the two portions of the plan can move forward independently; that Ersa Grae must convince the Opera the different portions of the plan can move forward independently; that the work will be more difficult if the two portions cannot move forward independently; however, the project will move forward; that the Opera can move forward with development on their land and improvement of the facilities; that Ersa Grae will coordinate construction with the Opera; that nothing exists which is mutually exclusive. Vice Chair Servian stated that risk is measured every day during development projects; that the Opera cannot not move forward without raising the necessary funds; and asked Ersa Grae's risk exposure in agreeing to the second contingency regarding allowing the Opera to raise funds on a feasible time line. Mr. Ebrahimi stated that the Opera's plans are being carefully studied to determine the necessity of the Opera's plans being dependent upon Ersa Grae's plans; that the belief is the two portions of the Opera's plan could be separated by a different time line; that a slightly different time line would avoid a substantial risk for Ersa Grae and the Opera; that Ersa Grae can tolerate certain risks but not others; that Ersa Grae will risk $3 or $4 million from the time the project is approved to pre- sales; that Ersa Grae cannot take a risk as significant as waiting one year or more to determine if the Opera can raise sufficient funding; that Ersa Grae will not be assuming the risk; that time is necessary to study the plans and develop some ideas with the Opera; that the intent is to make the two portions of the Opera's plan less dependent upon each other. Mr. Franklin stated that the target for vertical construction is 15 months; that the process is not static; that Plaza Verdi has a three permit stage process which include site work, utilities, streets, Florida Power and Light, etc.; that the foundation follows prior to vertical construction; that much of the work leading to the permit for vertical construction in 15 months is work which is constructed on a day to day basis. Member Palmer stated that Mr. Ebrahimi appears extremely optimistic regarding an agreement between Ersa Grae and the Opera. Mr. Ebrahimi stated that he is by definition as a developer optimistic; that he is sometimes foolishly fearless; that the Opera's plan is impressive; that the drawings should be provided to the CRA which will provide clarification; that the plan will be excellent for the future of the Opera; that one portion of the plan can proceed while the other portion follows. Member Palmer stated that Mr. Bavaria's concern regarding making a commitment is understood; however, she is optimistic; that the Opera makes a statement in the community; that an outpouring of support for the Opera will occur once people are aware the partnership is moving forward; that the Opera is an extraordinary institution; that the partnership is the best option for all the parties involved; that the partnership should benefit everyone; that the time frame is the major concern of everyone; that establishing a realistic time frame is necessary sO constituents can be aware the project is moving forward BOOK 2 Page 1563 11/29/04 3:00 P.M. BOOK 2 Page 1564 11/29/04 3:00 P.M. without delay or lapses in time; that some definition of a project ready to take off is necessary; that the City has to work with the Opera concerning the parking agreement; that many pieces of the project other than the agreements between Ersa Grae, the Golden Apple and the Opera must be addressed; that the City must work with all the parties to address the parking situation. Mr. Ebrahimi stated that the appearance may have been the plans have lapsed; however, work to move the project forward has continued; that the three month time period the Opera requires to establish plans for fundraising is not time wasted; that the City and Ersa Grae will be moving forward with the project during the time; that the CRA could not sign an agreement at this time if an agreement was brought forward; that the time is not being wasted. The following interested persons came forward: John Tylee, Executive Director, and Ian Black, Chair of the Policy Committee, the Downtown Partnership of Sarasota, Inc., 1818 Main Street (34236), came before the CRA. Mr. Tylee stated that Mr. Black is the Chair of the Policy Committee of the Downtown Partnership of Sarasota, Inc. (Downtown Partnership); that the President, Robert Richardson, would like to have appeared but is out of cown; that two months ago, he came before the CRA with a simple message; that the project is critical to the Downtown and the future of the Downtown; that the CRA is requested to allow sufficient time for the project to come to successful fruition; and distributed copies of the Downtown Partnership of Sarasota Statement to the CRA on the Plaza Verdi Project. Mr. Black stated that the opportunity to come before the CRA is appreciated; that the Downtown Partnership has previously expressed the fact the project is extremely important; that the project is important to the Opera and the Golden Apple but primarily to the City; that the project provides a wonderful, once in a lifetime opportunity to create the Downtown retail location for which Sarasota has yearned for over 22 years; that the project presents an opportunity to link Palm Avenue with Pineapple Avenue which has been discussed for many years; that focus is being placed on Downtown retail and the location for viable retail; that the project must happen for the future success of retailing in the Downtown for the next 50 to 100 years; that the nature of the transaction is extremely complicated; that the CRA is encouraged to continue to facilitate the successful conclusion of the process; that the views expressed by the parties involved have provided encouragement the work is in progressi that he is a real estate broker; that every transaction is subject to synchronizing all the pieces; that a number of pieces are involved in the proposed project; however, the project is moving forward in the appropriate direction; that the CRA is encouraged to continue to ensure the different pieces of the project proceed in the appropriate direction; that the project in Downtown Sarasota will be the envy of the State of Florida and the entire World as well; that the CRA has already expressed willingness to commit Tax Increment Financing (TIF) funds to the improvement of the park; that although people may be frustrated regarding an established time line, the project is moving ahead at a good rate; that the parties involved in the project all have different complexities concerning the transaction; that the progress shown at this time is excellent; that the CRA should encourage the progress to continue. Kerry Kirschner, 1590 Gulfview Drive (34236), stated that he is representing the Argus Foundation; that the views expressed by Mr. Black are shared; that everyone can have hotels and restaurants; however, the character of Sarasota is truly defined by its non profit organizations such as the John and Mable Ringling Museum, Mary Selby Botanical Gardens, Mote Marine Laboratory and Aquarium, and the Children's Museum, called the Gulfcoast Wonder and Imagination Zone (G.Wiz); that the City has always been a partner with the non profit organizations; that the time the Children's Museum came forward with $35,000 is recalled; that he wondered how a public building could be offered to an organization having only $35,000; that the Children's Museum came through; that the question is if the City loses character if large development is allowed; that the proposed project preserves the character of the City through incorporation of the Golden Apple and the Opera; that the Council of Fundraising Executives gives capital grants to a number of organizations; that the City has had non profit organizations in the community such as the Sarasota Ballet who have been in desperate financial circumstances and have been able to rebound and continue to thrive and survive; that the CRA is commended for continuing to display patience regarding the BOOK 2 Page 1565 11/29/04 3:00 P.M. BOOK 2 Page 1566 11/29/04 3:00 P.M. project; that the proposed project is more important to the community than parking; that a need for parking will not exist if interesting places and desirable destinations are not available in the Downtown; that restaurants will not survive without the Opera and the Golden Apple; that a reason must exist to draw people to the Downtown; that the CRA is commended for moving the process forward; that the Argus Foundation is not concerned with the schedule for the public parking and believes the CRA is moving forward in the appropriate fashion. Member Palmer stated that a status report in the near future is requested; that Staff could provide the report sO the CRA can have the knowledge the proposed project is progressing. Ms. Murphy came forward and stated that Staff will provide status reports to the CRA in any form preferred; that typically, after a Term Sheet is negotiated, an established group of Staff members as a project team meet with members of the development team, their attorneys and the other parties involved; that the meetings are normally held weekly or bi-weekly; that updates can be provided through the Administration or can be brought back during CRA meetings. Member Palmer stated that having a progress report which is public is important; that Staff can provide status reports in writing; however, a general date should be established to receive an actual progress report from the parties involved. Ms. Murphy stated that Staff will work with the Office of the City Auditor and Clerk to establish a date. Member Palmer asked if a specific time frame can be provided? Mr. Franklin stated that the suggestion is to schedule a workshop some time after January 1, 2005, to share the design concepts which have developed between Ersa Grae's architect and the Opera's architect; that more work will be conducted regarding the scheduling of the project, which can also be provided; that the status of the project can be shared with the CRA in January 2005 rather than waiting until March 2005. Ms. Murphy stated that Staff is attempting to schedule a joint workshop between the CRA and the CRA Advisory Board in January 2005 to bring forward the CRA Advisory Board's work program; that the status report of the proposed project could be provided during the second half of the meeting. Member Atkins stated that he would like to receive a written status report every 30 days; that a CRA meeting could be scheduled in conjunction with the March 21, 2005, Regular Commission meeting; that the status of the proposed project should be provided at the time. Vice Chair Servian stated that having more frequent status reports is desired; that status reports can be provided weekly if meetings are held each week. Ms. Murphy stated that the status report can be provided through the City Manager's weekly memorandum to the Commission. Vice Chair Servian stated that a request is for the Opera to update Staff on the same schedule as the meetings are held sO the CRA will know if all parties are proceeding in the same direction. Mr. Franklin stated that weeks may pass in which no changes take place; that second guessing the process should be avoided; that the process is complex since involving different people and consultants; that consultants sometimes take a week to report back. Vice Chair Servian stated that Staff is trusted to indicate no major items have occurred during the given week being reported but should indicate the plans are moving forward. Mr. Murphy stated that typically, something is always available to report weekly regarding large projects. Vice Chair Servian stated that waiting until January or February 2005 to begin receiving status reports is not the desire; that status reports can be provided in the City Manager's weekly memorandum. Chair Martin stated that being involved throughout the process of the proposed project to the greatest extent possible is the desire; that the CRA requires significant confidence the project is moving forward. BOOK 2 Page 1567 11/29/04 3:00 P.M. BOOK 2 Page 1568 11/29/04 3:00 P.M. Ms. Murphy asked if the CRA desires to have the overview of the project at the January 2005 joint workshop between the CRA and the CRA Advisory Board. Chair Martin and Vice Chair Servian stated yes. Member Atkins stated that the City Manager's weekly memorandum is sometimes rather cluttered, which is a concern; that he would like to receive his status report separately. Ms. Murphy stated that Member Atkin's status report can be provided separately; that Staff can meet with individual CRA members to provide additional information as well. Member Bilyeu stated that being provided the status update during a CRA meeting scheduled with a Regular Commission meeting is fine; that he is confident the proposed project is moving forward; that the project is close to fruition; that the hard work regarding the project is appreciated; that the report presented today is appreciated; that the progress report is pleasing; that work regarding the project has been ongoing for some time; that the next status report is favorably anticipated; that the manner in which the next status report is received is not a concerni that the hard work expended by all parties is appreciated. Chair Martin asked if the CRA's consensus is to agree the process is moving forward to receive regular status reports from Staff, and to receive a more detailed presentation at the January 2005 joint meeting of the CRA and the CRA Advisory Board, once scheduled. Vice Chair Servian stated yes. Members Palmer and Bilyeu agreed. 3. APPOINTMENT RE: : COMMUNITY REDEVELOPMENT AGENCY ADVISORY BOARD - REAPPOINTED DALE PARKS, KATHLEEN BAYLIS AND THOMAS QUALE; APPOINTED JOHN MCCOLLOUGH (AGENDA ITEM CRA-3) CD 4:21 through 4:26 Chair Martin stated that the item concerns appointments to the CRA Advisory Board; that the terms held by Dale Parks, Kathleen Baylis and Thomas Quale expired in July 2004; that all are eligible for and have expressed an interest in reappointment; and called for nominations. On motion of Member Palmer and second of Member Bilyeu, it was moved to reappoint Dale Parks, Kathleen Baylis and Thomas Quale to the Community Redevelopment Agency Advisory Board. Motion carried unanimously (5 to 0): Atkins, yes; Bilyeu, yes; Palmer, yes; Servian, yes; Martin, yes. Chair Martin announced the reappointments of Dale Parks, Kathleen Baylis and Thomas Quale to the Community Redevelopment Agency Advisory Board. Chair Martin stated that Glenda Mock has resigned from her seat on the CRA Advisory Board; that Ms. Mock was filling the seat designated for a resident of the Community Redevelopment Area; that one application has been received and is from Ronald McCollough; that Member Bilyeu has met with Mr. McCollough; that he has met with Mr. McCollough as well; and asked for nominations for the seat. On motion of Member Bilyeu and second of Member Palmer, it was moved to nominate Ronald McCollough to the Community Redevelopment Agency Advisory Board. Chair Martin asked if any members have any other nominations? Member Atkins called for discussion; and stated that receiving only one application is a concern; that the individual has only resided in the City less than one year; that a question is if the City provided proper notification of the availability of the seat; that the CRA Advisory Board is powerful; that the citizens like to recreate in the power of the Cityi that receiving only an application from a person who has only resided in the City for one year is a concern. Secretary Robinson stated that the availability of the seat was advertised numerous times; that individual members also attempted to recruit people; that one of the reasons for having only one application is the seat is restricted to a resident of the Community Redevelopment Area. Chair Martin stated that many residents live in the Community Redevelopment Area. BOOK 2 Page 1569 11/29/04 3:00 P.M. BOOK 2 Page 1570 11/29/04 3:00 P.M. Member Atkins stated that a question is the reason no one from the Gillespie Park Neighborhood Association or the Rosemary District applied for the open seat. Chair Martin stated that he personally attempted to recruit two different individuals; that the individuals were not able to submit applications due to a concern of potential conflicts of interest; that some people who may be interested are in the position of having potential conflicts of interest; that although a new resident, Mr. McCollough has considerable business background, which provides a level of confidence. Member Bilyeu stated that having someone with experience but no knowledge of actual issues is good in some cases; that the belief is Mr. McCollough will provide the necessary expertise on the CRA Advisory Board; that he also attempted to recruit people to serve. Member Atkins stated that only receiving one application from a new resident remains a concern; that another concern is if Mr. McCollough expressed a desire to speak to him; that if an appointment was scheduled is not known. Member Bilyeu stated that if an appointment was scheduled is not known; that the belief was people submitting applications for seats of advisory boards talk to all the Commissioners rather than only one or two. Member Atkins stated that he cannot recall having an appointment scheduled with Mr. McCollough. Chair Martin stated that the application was submitted on September 1, 2004, which was almost three months ago. Member Atkins stated that he does not recall speaking with Mr. McCollough; that he will check his schedule. Chair Martin called for a vote on the motion to appoint Ronald McCollough to the Community Redevelopment Agency Advisory Board. Motion carried (4 to 1): Atkins, no; Bilyeu, yes; Palmer, yes; Servian, yes; Martin, yes. 4. DISCUSSION RE: CHANGING THE REQUIREMENT FOR THE SEAT ON THE CRA ADVISORY BOARD DESIGNATED FOR AN INDIVIDUAL WHO IS A REPRESENTATIVE OF THE TRANSPORTATION MANAGEMENT ORGANIZATION = APPROVED TO RECOMMEND TO THE CITY COMMISSION TO AMEND RESOLUTION NO. 02R-1480 TO INDICATE TWO CITIZENS- AT-LARGE WHO SHOULD BE RESIDENTS OF THE CITY AS THE SEAT REQUIREMENT FOR THE OPENINGS ON THE CRA ADVISORY BOARD (AGENDA ITEM CRA-4) CD 4:26 through 4:31 Chair Martin stated that John Tylee has resigned from his seat on the CRA Advisory Board; that Mr. Tylee was filling the seat designated for an individual who is a representative of the Transportation Management Organization which no longer exists; that the Administration's recommendation is for the CRA to discuss the seat requirement and decide the desired background and/or experience for the seat requirement and make a recommendation to the Commission to amend Resolution No. 02R- 1480 to change Section 5(d) of Resolution No. 02R-1480 accordingly. Chair Martin continued that the seat could be designated as at- large; that the CRA has discussed revising the CRA plan also known as the City of Sarasota, Downtown Master Plan 2020 (Downtown Master Plan 2020); that some revisions have included initiatives for historic preservation, affordable housing, etc.; that the preference is to include another Citywide at-large citizen which will allow more flexibility; that the CRA could identify the necessary expertise at any given time. Member Palmer agreed; and stated that the individual must be a City resident; that the citizen at-large holding the seat must be a resident of the Cityi that the CRA has been extremely concerned regarding the issue of affordable housing; that the CRA requested the CRA Advisory Board research the issues concerning affordable housing; that specific expertise in housing is necessary on the CRA Advisory Board; that several members of the CRA Advisory Board are involved with real estate and understand the housing market; that affordable housing will continue as a major issue for the CRA over the next few years, not only in the Community Redevelopment Area but elsewhere in the Cityi that establishing another seat is not necessary since the CRA Advisory Board is sufficiently large; that the hope is to identify people with expertise in housing as other seats on the CRA Advisory Board become available. BOOK 2 Page 1571 11/29/04 3:00 P.M. BOOK 2 Page 1572 11/29/04 3:00 P.M. Chair Martin agreed; and stated that several members on the CRA Advisory Board at this time have expertise in real estate; that the CRA Advisory Board's work program can be tailored to emphasize affordable housing. Vice Chair Servian stated that Section 5(f) of Resolution No. 02R- 1480 designates the seat for a citizen-at-large; that the Resolution should be amended to indicate two citizens-at-large: that as applications come forward, the CRA can choose the applicant fitting the need at the particular time; that designating someone as a housing expert is a concern; that leaving the seat at-large will provide more flexibility. Chair Martin asked the length of Mr. Tylee's term. Secretary Robinson stated that Mr. Tylee was serving a three year term. Chair Martin asked if Mr. McCollough will be notified his term extends through July 2005? Secretary Robinson stated yesi and continued that a motion should be to recommend to the City Commission to amend Resolution No. 02R-1480. On motion of Member Palmer and second of Vice Chair Servian, it was moved to recommend to the City Commission to amend Resolution No. 02R-1480 to indicate two seats for citizens-at-large. Member Palmer stated that the two citizens-at-larye should be residents of the City. Chair Martin agreed; and called for a vote on the motion. Motion carried unanimously (5 to 0): Atkins, yes; Bilyeu, yes; Palmer, yes; Servian, yes; Martin, yes. 5. CITIZENS' INPUT CONCERNING CITY TOPICS (AGENDA ITEM CRA-5) CD 4:31 There was no one signed up to speak. 6. ADJOURN (AGENDA ITEM CRA-7) CD 4:31 There being no further business, Chair Martin adjourned the Special meeting of the Community Redevelopment Agency of November 29, 2004, at 4:31 p.m. - icka darfir RICHARD F. MARTIN, CHAIR ATTEST: Bully E Robens-on BILLY E. ROBINSON, SECRETARY BOOK 2 Page 1573 11/29/04 3:00 P.M.