Approves the Service Plan for the formation and establishment of the GCC (Globeville Commerce Center) Metropolitan District No.1 northwest of Washington Street and 51st Avenue in Council District 9. (LAND USE, TRANSPORTATION & INFRASTRUCTURE) Approves the Service Plan for the formation and establishment of the GCC (Globeville Commerce Center) Metropolitan District No.1 northwest of Washington Street and 51st Avenue in Council District 9. The Committee approved filing this bill at its meeting on 6-17-14.
Yes, Mr. President. I move that council bill five oh to be placed upon final consideration and do pass. It has been moved in, seconded the public hearing for council bill. Final Two is now open. May we have the staff report? Good morning or good afternoon. Good evening. Mr. President. I'm Andrew Johnston. I'm here at the Department of Finance on special districts and I'm here on Council Bill 502 Series 2014, which is an an ordinance to approve the service plans for the creation of the JCC Metropolitan Districts, number one. And two, the service plans for the JCC Metropolitan Districts. One and two are being submitted for the City Council approval on behalf of Globeville One LLC, pursuant to the requirements of the Special District Control Act, Title 32 of the Colorado Revised Statutes. This are these districts that we're going to hear about today have been a true collaboration between the Adams County and Denver County as the metro districts are located on a site that is the former Asarco smelting plant site, with approximately 80% of the project being located in Adams County and 20% located in Denver, generally located at the northwest corner of East 51st Street and Washington, running north to East 55th Street. The development will not have any residential development and accommodates only commercial and manufacturing development within the district's physical boundaries. The service plans address public infrastructure financing on the multi-jurisdictional, multi-jurisdictional site districts one and two are located in Denver and are the service plans pending for approval tonight. The service plans of districts number three and four are concurrently going through Adams County approvals process and should receive final approval on July 22nd. The service plans of Adams County are substantially the same as Denver's service plans. Adams County has agreed to include Denver's requirements of prevailing wage, smaller disadvantaged business enterprises, discrimination and public art. The districts will be responsible for coordinating the construction operation, financing and maintenance of all the improvements the JCC metropolitan districts have. All the powers of a metropolitan district described in Title 32 of the Colorado Revised Statutes as limited in the pending service plans. The financing plan specifies that a debt cap of 50 mills for debt and a total debt cap for all four districts not to exceed 25 million. The service plans anticipate 9.6 million of estimated infrastructure cost, utilizing only 40 mills for debt and issuing bonds to fund the infrastructure over time, including principal and interest. The service plans also anticipate levying ten mills for operations. The district's proponents are aiming for a November 2014 election for district creation upon approval by property owners in the districts at the November election and the court order, the districts will have the authority to operate in a manner prescribed in their service plans, city staff recommends and approval of Council Bill five or to the applicant. Their representatives and city staff are here tonight to respond to your questions regarding this Council bill. We will hear quickly a presentation from the developer and via finance group Cameron Birch, Ron and Sarah Laverty are here. The law offices of McKee de Cisneros, including Cassie Affirmant and Megan Becker, are here, and the city attorney's office. Karen Adolescent Nathan Lucero also worked on this project. Now we'll hear from Cameron Bertrand. The presentation, Madam Secretary. And. So. Thank you, Mr. President. Members of City Council. My name is Cameron Bertrand. I work for Enviro Finance Group and our company, Globeville One LLC is the applicant. Our company is located at 475 17th Street in downtown Denver. We are a Denver company, and I just wanted to provide a brief bit of context around the technical portions of the metropolitan district that Andrew just brought forward. Enviro finance group is a company that is Denver based. We're headquartered here and we specialize in what we call brownfield redevelopment. We acquire, remediate and finance the redevelopment of environmentally contaminated properties. And it's always exciting for us to have a project in our own backyard, as this one very much is. The project itself, as Andrew said, is located between 55th Street and 51st Street in north central Denver, along the corridor that is Washington. It's a 77 acre site which in a fully built out city like Denver, is quite a large area and we think create a great opportunity for the neighborhood and for Denver as a whole of that area. You see the county line in the slide in front of you is located along 52nd Avenue. So approximately 15 acres are in Denver and approximately 62 are in Adams County. That being said, I think it's worth noting that the neighborhood most immediately affected by this site, both historically and going forward, is the Globeville, Elyria, Swansea neighborhoods. This was a historic source of employment for them and we hope will be again in the future. Once we accommodate for roads, drainage, infrastructure, we get about 60 net developable acres. It is a contaminated site and has been for many, many years. The history of this site is one of the Asarco companies Globe plant where they've smelted metal dating back as early as 1886. On the good side of that is it created a great many jobs for a great many people for a long time. The downside of that is that the process of smelting metal contaminated the buildings, the soil and the groundwater. And it's been that case for many, many years. Our company has gone about the remediation process, and that includes the abatement and demolition of all the buildings that were out there, remediation of the groundwater that would otherwise flow as a base and into the South Platte River and then also soil remediation so that the soil itself is not a danger to health and human environment. I won't go into the details on this slide, but I've got it here. If anybody has questions later, the process for development is to take the site where we find it today or where we found it in 2011 when we started abate and demolish those buildings. That work has been done and was completed in 2012. That sets the stage for groundwater and soil remediation, which then sets the stage for grading and infrastructure. And then that middle slide, what you see is what what? Once we've been stopped, once we've graded out the site and installed the infrastructure you will have, which is basically four large super pads that can then accommodate individual commercial development . So that image on the right is one version of how this site might build out. That grading is not a small matter. There's about a 40 foot grade difference between 55th and 51st. So a lot of the exercise is one of creating flat, developable pads. The picture that you see on the right is just one example of how it might built out. But that example, there is a million square feet of new commercial development, which we think is an exciting opportunity for central Denver, north central Denver, but also its capacity to create jobs for for the residents of North Denver. In terms of timeline, like I said, we completed abatement and demolition of the buildings in 2012. Groundwater remediation was fully installed in two phases and completed by late last year. It is working, we think, extremely well. All the readings that we're getting suggest that the remedy is working and we believe that by the end of this year , the first quarter of next year, the groundwater remedy will be completely signed off on by the Colorado Department of Health and Public Environment. Soil remediation is follows. Groundwater remediation is underway now. It's an exercise of mixing the contaminated soils to stabilize them and then place them in a location where they don't come into contact with either groundwater or people. That is work that we expect to be done before the end of this year and it will then concurrent with over lot site creating or the placement of clean soil on top of the contaminated soil. What that does is that puts us in a position at the end of this year to actually begin to install site infrastructure, stormwater pipes, sewer pipes, water pipes, roads, streetscapes, etc. Which brings me to why we're starting this process now to create the metropolitan districts to do this site entitlement, to get the sign off so that at the end of this year, when the remediation is done, we'll have all the approvals that we need to go immediately into site site development and we think set the stage for vertical development as early as the second half of next year. So we think it's an exciting opportunity. The Metropolitan District is the tool that helps us finance that site infrastructure. Specifically, we think we have about $9.7 million worth of public infrastructure to install on this site, mainly consisting of streets, streetscapes, stormwater, sanitary sewer and water. The metropolitan district, we believe, has a bonding capacity of about 11.85 million, which, after fees and other costs, yields about $9.7 million worth of capacity to spend. It's worth noting that those models were run at 40 mills while the district has a capacity of 50 mills. So that extra ten mills that we don't intend to use do provide an additional $6.1 million in capacity if the infrastructure were to cost more than we anticipate the district is. The service plan includes a $25 million maximum debt issuance with a 50,000,000 million maximum. Debt service limit in terms of the mills on the site. And the other thing that we just put on here to note is that this site is also an urban renewal area with a property tax increment area, again in both Adams County and our county. So we will also have an agreement with Deer to provide for what I would call sort of the pass through of those property taxes that would go to Daera and then come back to the district so that the district can make its debt service. And then just in in in closing, I just wanted to say a broad thank you to an enormously long list of people that I won't go through. But this is a project that has been around in Denver since at least 2007, if not longer. The cooperation between Denver and Adams County has been remarkable. The work that the city agencies from Finance and Office of Economic Development that provided a grant, Adams County provided a HUD 108 loan, the Denver Urban Renewal Authority and the City Council provided a backstop for that loan to give HUD the comfort, to put it in place in the first place. And then all of the many, many neighborhood groups and neighborhood meetings that have gone into it. And a personal thank you to Councilwoman Monteiro, who has been there every step of the way, sometimes patting us on the back and sometimes kicking us in the butt to keep this one moving forward. And it has been a real privilege to work on it. And we're excited to be at a place where we can start talking less about cleaning it up and more about building buildings. And with that, I'll sit down. I do. If you have actual questions or hard questions. Kathy and the folks from D.A. Davidson are here and we can answer those questions. Thanks. Thank you, Mr. Bergeron and Mr. Johnston for the staff report. We have three speakers signed up and all three of them can come to the front pew and speak. We have Kathy Affirmant, Zachary Bishop and Mr. Saco. Good evening, councilors. My name is Kathy Offerman. I'm here with Mike Cisneros on behalf of the applicants of the JCC metropolitan districts. I don't have any independent comments, but I'm. Available for questions. Should the Council have any? Thanks. Thank you. Zachary Bishop. Good evening. I'm Zach Bishop with D.A. Davidson and Company. We are bankers for the Metropolitan District located at 1600 Broadway and also just here available for questions. Thank you, Mr. Speaker. Yes. Germans say Ku Klux Arts Movement Self-defense advocates for poor, working, poor and homeless people. Metropolitan districts. We require a lot of research and study. Especially when they're being organized and sponsored by corporations. And if you don't have strong community support in education, then what you will have happen is that a superimposed authority, quasi judicial, who can tax commercial and private properties through the House written up. And I haven't seen the write up in terms of how this thing is going to operate, operate because you have to create a board that's going to control this thing, say. And when you get to talk about how the board is going to be appointed or elected and how the community is going to be involved in that in terms of selection of the people who are going to participate in this thing. And then it's a hidden tax because most people don't even know they're in metropolitan districts who are in metropolitan districts because most of the citizens don't either look at this stuff going on down here or is explained to them thoroughly what this is going to happen before it gets on the ballot. And then they missed it. And then it pops up in the text and they say, What is this? And then it becomes the law. Because you didn't participate, because you weren't paying attention, because you was watching a baseball game. When these kind of decisions are being made, that's going to impact you for the next 20 years. 20 years. And you don't even know these people here. You don't even know him. You haven't even been in the corporations to see what their community involvement has been historically. And you're going to pass this. You've already made up your mind to do it. I know you're going to do it. And that's okay. Because one thing I've learned from coming here for three and a half years is that I had to learn tolerance. There were things that I was going to have to accept that I hated, and yet I'd have to tolerate it because of the misinformation and education of the masses of people. They wouldn't understand what I was talking about anyway, and what he was just talking about was so garbled and mixed up with folks who had happy. Y'all don't even know what he was talking about. Mr. Speaker, you. Say with this. Mr. Speaker, thank you for your time. Support this thing just on the strength of tolerance. Until the people wake up to this. Thank you. That concludes our speakers for Council Bill five of two. Do we have any questions for members of council? Starting with council members? Yes. CAMERON Well, I'm sorry I stepped down and you may have already talked about this, but I'd love to get kind of a grander vision of what you guys hope to accomplish here on the site. You talked a little about commercial, but I don't know if some some visioning has been done. And maybe you can go into that a little bit. A little. The answer to your question is a little bit. Sorry. I'm trying to see if I can make that this image a little bit bigger. But the the site is is for a variety of reasons, got a number of restrictions that will stay in place that will prohibit residential use, agricultural use. So commercial use is the is the principal use. And we really think, given its location at the really the crossroads of I-70 and I-25, that it's a fabulous opportunity for Denver and Adams County to build new warehouse logistics distribution, flex new modern manufacturing. So I would I would really describe it as a business park. And then the site layout itself is actually dictated to some extent by that grade differential, where the Adams County site is almost 35 to 40 feet higher than the Denver County side. So the infrastructure almost starts to lay itself out. But the way I would describe it is sort of akin to Stapleton Business Center or Compaq or other large, you know, commercial business parks in the metro area. The nice thing about this one is, is it's right in central Denver where we're losing a lot of that opportunity to years. But it's exciting to get some light in manufacturing capacity. What's the zoning on this? It's today the zoning is it's got four zoning districts because it's got two in Denver and two in Adams County. In the old code, I would sort of call it eye to. Yeah, well, on the Adams County side, there will be a pudi that'll overlay that zoning. But we're really focused on clean, modern manufacturing logistics distribution. And we think that the other thing that's nice about this site is it's got some the potential for some very large parcels where you can build some some 300,000 or larger square foot buildings, which is kind of unique for central Denver. Thank you. Thank you. Councilmember Councilwoman Montero. Thank you, Mr. President. Um, I'll just I'll ask this question and then you guys can figure out who who should take it. So let's talk about the election and who's going to pay for the election. When is the election for the metro districts? And then who gets to vote? Looks like he's gonna like Councilwoman Monteiro. I'm happy to respond to those questions. Garcia from Anthem. Mickey D's for. Should the service plans be approved by both city. And county of Denver and Adams County? We're gearing up for a November 2014 election. The electors of the districts will be. Qualified by the property owner. The district is consist the district boundaries consist of only, while the service area consists of only the 77 acres, which is our commercial property. So in order to vote in an election, they will be qualified by the property owner, which at that time will be Global One LLC. Okay. So this is I just want to want to clarify that city of Denver, across the board will not be voting on these two particular metro districts. Right. How many property owners will be voting. At this point? There will be only one property owner. That would be Globeville, one LLC, we anticipate at the time of the election, and that is also the only property owner that will be subject to any taxes of the district. Okay. Thank you. Thank you, Councilman Montero. Councilwoman Ortega. Thank you. I have a couple of questions. So the first one is, can you, Cameron, tell me where the entrance to the site will be? I'm assuming that there will be access points both from Adams County and Denver, Kelly. You bet. And is it is it possible to put this back on the screen? I'm secretary of the department. Oh, it is on the screen, is it? Sorry. There you go. So I tried to make that one image just a little bit larger, if that helps, folks. So the two main entrances to this site will very likely be 52nd Avenue, which is the county line on the south. Yep. Because that will come in if. I don't know if you can see my cursor. Yeah. That will come in right in the middle of the lower what I call the lower pad because that everything to the left of this road right here, all this area is about 35 feet lower than everything up here. So this is larger. Adams County area will very likely enter off of 55th Avenue, where we expect through the pad process to install a new traffic light. So 55th Avenue will see those larger buildings on the north end and then 51st and 52nd will feed the traffic and the low and the smaller and medium sized buildings on the south end. So do you expect the the development on the south side of 52nd Avenue to look and feel any different than the development that will be on the north side? I think it will in that the nature of the buildings are necessarily probably different right there. Those are 20 to 50, maybe 100,000 square foot buildings, whereas the buildings on the north side at least have the potential to be 150 to 300, even 500,000 square feet. So I definitely think there's an architectural difference there and a use difference. That being said, we have we are imposing a set of design standards and architectural guidelines over the entire site so that will function and feel like a single cohesive business park. So I want to ask some financial questions and I'm not sure. Maybe here you might be the right person. So help me understand the cost sharing on the administrative cost to get us to this point. And then what is any of the cost sharing look like as the revenue is being generated? I mean, you know, just looking at the map alone, you could see that you're going to have bigger buildings on the north side. Obviously, there's more land in the Adams County side. So how does that work? I think I understand the question. So by cost sharing, you mean infrastructure cost across the site relative to where then where the income is generated? Right. Got it. So to answer your first question from the cost, not only to get us here, but the cost to where we're going will be financed entirely by Global One LLC, in part through assistance from the HUD one away alone. So we do have some financing tools that help us spend what will ultimately be more than $10 million, both to bring the site to this point, but also build all the infrastructure that you see on this on this page. The Metropolitan District, on a day in which these buildings are built and taxes are generated, we hope will be able to issue debt to reimburse those costs in the future. But they are not going to be financed by the Metropolitan District on day one. Globeville one will advance those funds and hope to be repaid. And what was the amount of the Hudson-Odoi loan? It's a maximum outstanding principal balance of $10 million. Okay. So one last question and this is about the the tax increment piece. So it's my understanding that Doura is playing that role and I see Tracy in the audience for the entire property. Correct. So does that function in the same way then in terms of cost share, all of that associated with where the taxes are being generated and where they're going to be applied in terms of offsetting any of the infrastructure costs or any of those things? You would think so. So that the answer to your question is yes. The the urban renewal area covers the entire site and is sort of agnostic as to where revenues are generated and where costs are needed because we're trying to redevelop the entire site. So it is truly regional cooperation. And in that regard, I did want to be clear, though, that the purpose of of the urban renewal area in the tax increment area that has been approved so far. Was to backstop that had 108108 loan. And so as we sit here today, we, we don't actually believe that we will need to utilize tax increment to repay that loan, which is great news. Okay. So, so given that it was created as a Doura district, that typically when Doura participates in these projects, there are some administrative costs that are reimbursed back to Doura. Is that going to be handled like they're typically done with this project? So Tracy, I'm looking at you. Do you want to come forward and just elaborate on that? Good afternoon, members. Good evening, members of council. I'm Tracy Huggins. I'm the executive director of the Denver Urban Renewal Authority. The answer is yes. To the extent that there are administrative expenses incurred by Doura, it is the developer's responsibility to reimburse those costs that are incurred. Which may or may not happen. I understand there have been some costs already incurred and already reimbursed, so they are doing what they're supposed to do. Okay, great. Thank you. That answers all of my questions. Thank you, Councilwoman Ortega. Councilwoman Monteiro. Thank you, Mr. President. I have two additional questions. The the first one is, why is in viral finance not able are future developers able to build residential on the parcels in the city and county of Denver? And then the second one is maybe you can answer. It also is, can you share with my colleagues the public outreach efforts that you have gone through? Thank you. Yvette. To the to the first question, it it dates back to first and foremost, the legal answer is there's an environmental covenant that is restricts uses on the site. It was put in place by CDP. She at the time that CDP and EPA were imposing on then Asarco as the owner the cleanup standards that today we're implementing and it's fairly simple it is while we are remediating remediating the site to an end to a commercial industrial standard where it will be safe for people to work on the site and build buildings on the site and construct buildings on the site. The cleanup standards don't meet those for a residential development. It would not be you would not want children, you know, playing vegetables, growing. It really is that straightforward. And it is not a choice that Denver had. It's not a choice that Globeville one had. It was imposed by EPA and CDP. And it is it is the law of the land is where the site is regard is is regarded with regard to public outreach. It really goes back, almost to my knowledge, as early as 2007, there was a lot of public outreach both around the clean up of the site and the property around the site, then surrounding the creation of the urban renewal area, then surrounding the passage of the HUD 108 loan. Globeville one EFC is a company, has met at times quarterly, but always at least biannually with with the community to update them both on the status of the clean up answer questions about the trucks that were driving in and out of the community and what was going on there. And then most recently about the development plans and the creation of this metropolitan district, we had a meeting, as you know, because you were there the as recently as last month surrounding the Pudi on the Adams County side. So we I haven't counted them up, but I'm sure it's north of 20 or 30 and I'm sure there will be that many more to come as we develop the site. And then with two months ago that the Globeville Neighborhood Planning Steering Committee, we did a bus tour. Yeah. And yelled and talked for about this is like 45 minutes about about the development there on the site. Yeah, it's it's it's a it's a it's been a long time coming. But this this neighborhood really has gotten very involved. I think that they they really do understand what caused the contamination. They understand what we're doing to to clean it up. And they're excited to be moving into the to the to the point in time at which it gets gets redeveloped and and the buildings can be built and jobs can be created. The only other thing that I just want to clarify is I just want to ask the question can can housing be built on this property? Housing cannot be built on this property. Thank you. Thank you. Councilman Monteiro. Councilmember, you said something mean. Did you want to. Oh, just going to have camera make sure that all the acronyms that he was describing. Colorado Department of. Oh, got it. Yeah. I'm sorry. So, EPA, Environmental Protection Agency, CDP, Colorado Department of Public Health and the Environment. See, EPA has given its authority to CDP to oversee us as we clean the site. Housing and Urban Development, thousands of viewers. Yes. Even give that. Yeah. All right. Thank you. Gotham Councilwoman Lyman, for bringing that up. Any other questions from members of council and seen the public hearing for Final Two is closed now? Time for comments from members of Council Council Monteiro. Thank you, Mr. President. Thank you so much for your presentation this evening. As was mentioned, we've been talking about the Asarco site for four years and I then I choose to count. But in this in this particular situation, I'm very excited about the cooperative agreement and partnership between Adams County in the city of Denver. The majority of this property is in Adams County. And as I understand it, they're probably going through a similar review for their service plans around this situation. This particular project has a possibility on the Denver site. I sound so territorial and the city and county of Denver to create a possibility of between 350 and 400 jobs and on the Adams count and around 1500 to 2000 on the whole site, including Adams County, that depends on the density and the development. But also we'll focus on middle skill and middle wage jobs in this in the city of Denver. In my opinion, there's a huge need for light manufacturing in industrial locations in the city, since many of the operations have been taken up by another industry. As far as the locations in Council District nine, the industrial park areas, as was shared with me, have the lowest vacancy rates to date. And on this particular site, the facilities will be modernized industrial areas, making them even more attractive to to the Globeville area. So I wholeheartedly support advancing this forward and ask for the support of my colleagues as well. Thank you, Mr. President. Thank you, Councilman Monteiro. Councilwoman Ortega. Mr. President, I want to also express my support for this project moving forward. I think having known much of the history of this site and worked with these neighborhoods back when it was actually an operating smelter and lived through the whole process with the neighborhood and the whole CDP, you know, process of of cleaning up the neighborhood and working with EPA and, you know, looking at the cleanup that really went beyond the Globeville neighborhood, but realizing that there's an interested party that is wanting to do this development and has taken the steps to remove the buildings which in themselves required significant cleanup. This is exciting for these neighborhoods, creating the opportunity for employment. Looking at a site that has sat there as a vacant, sort of abandoned parcel that really wasn't contributing to the community at all in creating these new opportunities for something that will look nice in the neighborhood, that will add the jobs, stimulate our economy for not only that area, but for the city of Denver as a whole and in the interface with our neighbors to the north. So I think overall, this is really a great opportunity for Denver, and I appreciate the role that Dora has played in sort of brokering this between the two counties to help move it forward. And I want to thank Councilwoman Monteiro for her role in working with the neighborhoods to make sure their voice was a part of the process throughout every step of the way. So with that. Thank you, Mr. President. Councilwoman Canete. Thank you. Thank you, Mr. President. I don't know if folks remember, but when we have the urban renewal area come through for this part of the city, during that process, one of the residents of this area said, you know, industrial, you don't need more industrial. That's how we got into this spot in this neighborhood. And I think it's such a testament to Councilwoman Montero's leadership and the outreach of EFC that we now have residents excited about the jobs, because I think we've really educated folks about the way that, you know, I always say from my mother's factory, right, that that modern manufacturing doesn't have the same environmental impacts if it's well planned and well designed for high quality, you know, high input, low, low output kind of production. So I'm excited about the potential and I'm so pleased and so appreciative of your leadership and the level of community support that we have for this use. My one favor to ask is that since this may be our last time to see you for this project before you go out and flourish, is that please hold out for the manufacturing over the warehousing warehouse is great. It takes up huge stretches of land. It's important for getting products to market very few jobs per square foot. And so please don't jump at the first tenants if they are, you know, distribution warehouse, please hold out for some of that higher intensity employment if you can, because it would be really great to see the higher end of those estimates rather than the lower end. So if that's possible in the market, if it does, it have a real spur. If it did, it would be perfect. We have so many employers who need that, but the great transportation asset access should be an asset even without rail. So thank you very much. And I'm very enthusiastically supportive of this district tonight. Thanks. Thank you. Councilwoman Canete. See no other comments by members of Council. Madam Secretary, Roll Call. Montero by Neville. I. Ortega I, Rob Brooks. I. But I can eat lemon lopez. All right. Mr. President. Hi, Madam Secretary. Please close voting and announce the results.