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HomeMy WebLinkAbout10/24/2018 - Minutes The Economic Development Authority of Roanoke County Roanoke County Administration Center Board of Supervisor's Meeting Room, 5204 Bernard Drive Roanoke,Virginia 24018 Minutes Wednesday, October 24, 2018 The Economic Development Authority of Roanoke County,Virginia met this day at the Roanoke County Administration Center. Members Present Chairman-Steve Musselwhite Vice Chairman-Woody Windley Greg Apostolou Max Beyer Leon McGhee Kyle Richardson Michael Cagle Ssunny Shah Kirtesh Patel Ruth Ellen Kuhnel, Counsel Webster Day, Counsel Jill Loope, Secretary-Treasurer Glenna Ratcliffe, Recording Clerk Members Absent Steve Anderson Guest John Mehrkens, Principal, Baile Senior Development; Carrie Cecil, Assistant to Webster Day with Spillman Thomas &Battle; Rebecca Owens, Director of Finance; Evan Malone, Financial Analyst; Ashley Anderson, Finance Manager; George Child, CEO Richfield Living; Cherie Grisso, CFO Richfield; Philip Thompson, Roanoke County Planning Director CALL TO ORDER Chairman Steve Musselwhite determined a quorum was established and called the meeting to order at 9:00 a.m. REQUEST TO POSTPONE, ADD TO, OR CHANGE THE ORDER OF THE AGENDA ITEMS No Changes Page 2 of 9 October 24,2018 Economic Development Authority Minutes APPROVAL OF AUGUST 15,2018 MINUTES On motion by Mr. Shah to approve the minutes of August 15, 2018 as presented, seconded by Mr. Richardson, the motion carried by unanimous voice vote. FINANCE REPORT Evan Malone, Financial.Analyst, reviewed the information provided on the financial report for the month ending September 30, 2018. On motion by Mr. Windley to accept and approve the financial report as presented, seconded by Mr. Shah the motion carried by unanimous voice vote. NEW BUSINESS Consideration of Rules and Procedures for Applicant to the Authority Ms. Loope gave an overview of the bond financing process currently in place by the Roanoke County EDA; the EDA charges an application fee of$1,250 as well as other expenses including legal, advertising and audit fees associated with any bond issue. She then reviewed the proposed Rules and Procedures document for the Authority's consideration. She stated that the EDA did not currently have a policy,but legal staff is recommending adoption of certain policies to ensure additional accountability. This would include approving Rules and Procedures for the Bond Financing Program and a Post-Issuance Compliance Policy. Rebecca Owens, Director of Finance, stated as part of the review process regarding updating the Rules and Procedures, it was determined an annual fee of 1/8 of 1% of the outstanding bond amount could be assessed, as that is the allowable legal limit, and would be in addition to the application fee of $1,250. In response to a query by Greg Apostolou, Ms. Owens stated the application fee is in line with other counties as staff did reach out to other localities regarding their fee schedule. A lengthy discussion ensued and it was confirmed that fees collected would flow back into the EDA budget for future economic development projects. On motion by Mr. Windley to adopt the Rules and Procedures as presented, seconded by Mr. Richardson the motion was approved by unanimous voice vote. Consideration of Fee Schedule for Applications for Bond Financing Ms. Loope and Ms. Owens reviewed the Fee Schedule for Application for Revenue Bond Financing that confirms the application fee, and the administrative fee of 1/8 of 1% annual amount to be applied to the principal amount of bonds outstanding, which could vary from year- to-year. The annual administrative fee is due for all bonds issued by the EDA as provided in the Rules and Procedures adopted by the EDA. Ms. Owens pointed out this fee could be reduced or waived at the discretion of EDA. Page 3 of 9 October 24, 2018 Economic Development Authority Minutes On motion by Mr. Cagle to accept the Fee Schedule as presented, seconded by Mr. Beyer, the motion was approved by unanimous voice vote. Consideration of Post-issuance of Compliance Policy for Tax-Exempt Bonds Ms. Owens stated the Compliance Policy to be adopted by the EDA is to establish procedures to be followed in order to comply with the post-issuance compliance requirements of the Internal Revenue Code of 1986, as amended. This document was reviewed with members. On motion by Mr. Patel to accept this Policy as presented, seconded by Mr. Shah the motion was approved by unanimous voice vote. Presentation by Richfield Living At this time, Cherie Grisso introduced some of the Project Team to include George Childs, CEO Richfield Living; John Mehrkens, Principal, Baile Senior Development; and Al Knighton, Counsel for Richfield Living. A PowerPoint Presentation, "Vision 2020: Project Home" provided detailed information regarding the vision to create a "home" environment, expansion of the existing living offering and repositioning the first impression of the campus. (See link to "Vision 2020: Project Home"). ADD LINK Public Hearing on a plan of fmance for Richfield Living involving the issuance of revenue bonds in the amount up to $99,000,000 notice of which hearing has been published in the Roanoke Times on October 10 and 17,2018. It was noted that although the hearing notice in the Roanoke Times stated the public hearing would be held in Room 438, that room was unavailable for the Authority meeting, and notices that the location had changed to the Board of Supervisor's Meeting Room on the first floor was posted on the door of Room 438 on the fourth floor of the Roanoke County Administration building as well as at the guard's desk in the first floor hallway and on both entrance doors to the Administration building located at 5204 Bernard Drive. Chairman Musslewhite Opened the Public Hearing. Mr. Apostolou inquired of the financial rating of Richfield Living. Cherie Grisso stated they received three or four stars with high occupancy averaging 80%. Mr. Beyer questioned if Board Membership is local. Ms. Grisso stated Richfield Living Board Members are all local citizens. Page 4 of 9 October 24, 2018 Economic Development Authority Minutes Webster Day, Counsel representing the County, stated a recommendation from the EDA goes to the Board of Supervisors for approval. The EDA is scheduled to meet again November 14, 2018. If bond is approved,the closing will be sometime in December. Rebecca Owens stated approval of the bond does not obligate the County or State. Chairman Musselwhite asked if there were further questions. Webster Day asked if any members of the public had any comments. Leah Keller, representing Richfield Living Board stated Richfield has gone through two years of planning and research to achieve this goal and the financing is critical. She stated she does appreciate consideration of the request. Chairman Musselwhite closed the public hearing. Consideration of a resolution titled: "RESOLUTION OF THE ECONOMIC DEVELOPMENT AUTHORITY OF ROANOKE COUNTY,VIRGINIA, PROVIDING INITIAL APROVAL OF THE ISSUANCE OF UP TO $99,000,000 OF REVENUE BONDS FOR THE BENEFIT OF RICHIELD LIVING". Ms. Kuhnel stated she has served as Counsel to the EDA for approximately three years and felt since she would be Counsel to the BOS on this bond hearing, the EDA should have outside Counsel; therefore, Webster Day was hired to handle this transaction. The EDA will adopt a resolution as a recommendation to the Board of Supervisors. Ms. Owens stated the EDA acts as a conduit for the bond issue; no debt is incurred to the County or the EDA. The Board has been advised of this project and she stated that the details of the financing are not addressed in the resolution. John Mehrkens, Developer, stated that based on the size of the transactions, $100,000 a year in fees would greatly impact residents of the center. Ms. Owens stated the Resolution today is absent any financial detail. The Resolution adopted on motion by Mr. Apostolou, seconded by Mr. Shah, with the following recorded vote: AYES: Mr. Musselwhite, Mr. Windley, Mr. Patel, Mr. Shah, Mr. Apostolou, Mr. McGhee, Mr. Byer, Mr. Richardson, Mr. Cagle NAYS: None xt ABSENT: Mr. Anderson RESOLUTION OF THE ECONOMIC DEVELOPMENT AUTHORITY OF ROANOKE COUNTY, VIRGINIA, PROVIDING INITIAL APPROVAL OF THE ISSUANCE OF UP TO $99,000,000 OF REVENUE BONDS FOR THE BENEFIT OF RICHFIELD LIVING Page 5 of 9 October 24, 2018 Economic Development Authority Minutes F . WHEREAS, the Economic Development Authority of Roanoke County, Virginia (the "Authority"), is empowered by the Industrial Development and Revenue Bond Act, Chapter 49, Title 15.2, Code of Virginia of 1950, as amended (the "Act"), to issue its revenue bonds to finance or refinance the construction and equipping of facilities for the residence or care of the aged to protect and promote the health and welfare of the inhabitants of the Commonwealth of Virginia(the "Commonwealth"); and WHEREAS, the Authority has received a request from Richfield Living, a Virginia nonstock corporation (the "Organization"), whose address is 3615 West Main Street, Salem, Virginia 24153 (the approximately 50 acres of land within the County of Roanoke, Virginia, owned by the Organization at and adjacent to such address being referred to as the "Campus"), to issue its revenue bonds (the "Bonds"), in one or more series at one time or from time to time, to provide funds to the Organization: (1) to refinance the Authority's Revenue Bonds (Richfield Retirement Community), Series 2008B (Tax-Exempt), the proceeds of which were used to finance or refinance, in whole or in part: (a) the acquisition, construction and equipping of an assisted living facility located at 3939 Daugherty Road on the Campus, (b) the construction and equipping of an assisted living facility located at 3706 Knollridge Road on the Campus, (c) the construction and equipping of a professional building located at 3737 West Main Street on the Campus, (d) the construction and equipping of two buildings, each comprising residential units for use as facilities for the residence of the aged located on the Campus, and (e) other costs associated with the foregoing, including, without limitation, costs of issuance, credit enhancements, capitalized interest and working capital; (2) to refinance a taxable loan from Branch Banking and Trust Company, the proceeds of which were used to finance or refinance, in whole or in part: (a) the renovation and construction of a former assisted living building into a short-term rehabilitation facility; (b) renovation of and improvements to common areas in The Oaks assisted living facility on the Campus; and (c) paying certain costs and expenses associated with the loan. (3) to refinance a taxable line of credit from Branch Banking and Trust Company, the proceeds of which were used to interim finance or refinance, in whole or in part the costs Page 6 of 9 October 24, 2018 Economic Development Authority Minutes financed and refinanced under(2) above, routine maintenance expenses on the Campus and other Campus-related improvements; (4) to finance the acquisition, construction, demolition, renovation and equipping of various buildings on the Campus, including the construction of new independent living units, the reconfiguration of a transitional care facility and a replacement nursing facility, all located on the Campus; and (5) to finance, if and as needed, capitalized interest on the Bonds, a debt service reserve fund for the Bonds, costs of issuance related to the issuance of the Bonds, working capital, routine capital expenditures at the Campus and other related.costs (collectively (1) — (5) above, the "Plan of Finance"); and WHEREAS, preliminary plans for the Plan of Finance have been described to the Authority and a public hearing has been held as required by Section 147(f) of the Internal Revenue Code of 1986, as amended, and Section 15.2-4906 of the Act; and WHEREAS, the Organization has represented that the estimated cost of undertaking the Plan of Finance will require the issuance of revenue bonds, in one or more series at one time or from time to time, in the aggregate principal amount not to exceed $99,000,000; and WHEREAS, (1) other than Kirtesh Patel, no Director of the Authority is an officer or employee of the Organization or the County of Roanoke, Virginia ("Roanoke County"), (2) each Director has, before entering upon his duties during his or her present term of office, taken and subscribed to the oath prescribed by Section 49-1 of the Code of Virginia of 1950, as amended and (3) at the time of their appointments and at all times thereafter, including the date hereof, all of the Directors of the Authority have satisfied the residency requirements of the Act; and WHEREAS, no Director of the Authority has any personal interest or business interest in the Organization, the Bonds, or any of the transactions contemplated therein or has otherwise engaged in conduct prohibited under the Conflict of Interests Act, Chapter 31, Title 2.2 of the Code of Virginia of 1950, as amended, regarding this resolution or any other official action of the Authority in connection therewith. NOW, THEREFORE, BE IT RESOLVED BY . THE ECONOMIC DEVELOPMENT AUTHORITY OF ROANOKE COUNTY,VIRGINIA: 1. The Authority hereby finds and determines that the Plan of Finance will be in the public interest and will promote the commerce, safety, health, welfare, convenience or prosperity of the Commonwealth, Roanoke County and their citizens and in particular, will promote the providing of health care facilities and other facilities for the residence and care of the aged in accordance with their special needs. 2. The Authority hereby agrees to assist the Organization in undertaking the Plan of Finance by issuing its Bonds in the aggregate principal amount not to exceed $99,000,000 upon terms and conditions mutually agreeable to the Authority and the Organization. The Bonds will be issued pursuant to documents satisfactory to the Authority. The Bonds may be issued in one or more series at one time or from time to time. Page 7 of 9 October 24,2018 Economic Development Authority Minutes 3. It having been represented to the Authority that it is necessary to proceed immediately with the Plan of Finance, and the planning therefor,the Authority hereby agrees that the Organization may proceed with the Plan of Finance and take such other steps as it may deem appropriate regarding the Plan of Finance, provided, however, that nothing in this resolution shall be deemed to authorize the Organization to obligate the Authority without the Authority's consent in each instance to the payment of any moneys or the performance of any acts regarding the Plan of Finance. The Authority hereby agrees that the Organization may be reimbursed from the proceeds of the Bonds for all expenditures and costs so incurred by it, provided such expenditures and costs are properly reimbursable under the Act and applicable federal laws. 4. At the request of the Organization, the Authority hereby approves McGuireWoods LLP, Richmond, Virginia, as Bond Counsel for the issuance of the Bonds. 5. All costs and expenses for undertaking of the Plan of Finance, including the fees and expenses of Bond Counsel, shall be paid by the Organization or, to the extent permitted by applicable law, from the proceeds of the Bonds. If for any reason such Bonds are not issued, it is understood that all such expenses shall be paid by the Organization and that the Authority shall have no responsibility therefor. 6. The Authority hereby recommends that the Board of Supervisors of the County of Roanoke, Virginia (the "Board") approve the issuance of the Bonds for the purpose of undertaking the Plan of Finance within 60 days of the date of the adoption of this resolution. 7. The Organization shall indemnify and save harmless the Authority, its officers, directors, counsel, employees and agents, from and against all liabilities, obligations, claims, damages, penalties, fines, losses, costs and expenses in any way connected with the Organization or the issuance of the Bonds. 8. No Bonds may be issued pursuant to this resolution until such time as the issuance of the Bonds has been approved by the Board and a final resolution is approved by the Authority. 9. This resolution shall be effective immediately and shall continue in full force and effect for a period of one year after adoption, unless specifically extended by the Authority; provided that no Bonds shall be issued after December 31, 2018, unless an authorization of the Board permits it. 10. The Authority directs the Secretary to submit to the Board this resolution, the Organization's Fiscal Impact Statement, and a summary of the public hearing held by the Authority, which constitutes the recommendation of the Authority that the Board approve and concur in the Plan of Finance. CLOSED MEETING At 10:20 a.m., Mr.Windley moved to go into closed meeting, seconded by Mr. Shah, pursuant to the Code of Virginia Section 2.2-3711.A-5 discussion concerning a prospective business or industry or the expansion of an existing business or industry where no previous announcement has been made of the business' or industry's interest in locating or expanding its facilities in the community. Page 8 of 9 October 24,2018 Economic Development Authority Minutes The closed meeting was held from 10:20 a.m. until 10:50 a.m. Resolution Certifying the closed meeting was held in conformity with the Code of Virginia. At 10:50, Mr. Windley moved to return to open session and adopt the Resolution, seconded by Mr. Apostolou,with the following recorded vote: AYES: Mr. Musselwhite, Mr. Windley, Mr. Patel, Mr. Apostolou, Mr. Shah, Mr. McGhee, Mr. Beyer, Mr. Richardson and Mr. Cagle NAYS: None ABSENT: Mr. Anderson WHEREAS, the Economic Development Authority of Roanoke County, Virginia has convened a closed meeting on the date pursuant to an affirmation-recorded vote and in accordance with the provisions of The Virginia Freedom of Information Act. WHEREAS, Section 2.2-3711 A (5) discussion concerning a prospective business or industry or the expansion of an existing business or industry where no previous announcement has been made of the business' or industry's interest in locating or expanding its facilities in the community. WHEREAS, Sections §2.2-3712 (D) of the Code of Virginia requires a certification by the Economic Development Authority of Roanoke County, Virginia, that such closed meeting was conducted in conformity with the Virginia Code. NOW THEREFORE, BE IT RESOLVED, that the Economic Development Authority of Roanoke County, Virginia, hereby certifies that, to the best of each member's knowledge, only such public business matters as were identified in the motions convening the closed meeting were heard, discussed or considered by the Economic Development Authority of Roanoke County, Virginia. On motion of Mr. Windley, and seconded by Mr. Richardson, which carried by a 9-0 vote, the Board certified the closed meeting as required by Section 2.2-3712(D) of the Code of Virginia, upon the conclusion of the Closed Meeting. Roll call vote: AYES: Mr. Musselwhite, Mr. Windley; Mr. Patel, Mr. Apostolou, Mr. Shah, Mr. McGhee, Mr. Beyer, Mr. Richardson and Mr. Cagle NAYS: None ABSENT: Mr. Anderson On motion by Mr. Beyer to authorize the Economic Development Authority Chairman to submit a rezoning application to amend the covenants, conditions, and Master Plan on approximately 443 acres owned by the Economic Development Authority at the Center for Research and Technology, seconded by Mr. Shah and carried by the following recorded vote: Page 9 of 9 October 24,2018 Economic Development Authority Minutes AYES: Mr. Musselwhite; Mr. Windley, Mr. Patel, Mr. Apostolou, Mr. Shah, Mr. McGhee, Mr. Beyer, Mr. Richardson, Mr. Cagle NAYS: None ABSENT: Mr. Anderson On motion by Mr. Cagle to authorize the EDA Chairman to execute an option agreement for the sale of Lot 1 in the Center for Research and Technology (CRT) to a prospective business, seconded by Mr. Richardson. The motion carried with the following recorded vote: AYES: Mr. Musselwhite; Mr. Windley, Mr. Patel, Mr. Apostolou, Mr. Shah, Mr. McGhee, Mr. Beyer, Mr. Richardson, Mr. Cagle NAYS: NONE ABSENT: Mr. Anderson ECONOMIC DEVELOPMENT UPDATES Plantation Road At this time, Ms. Loope stated the Plantation Road Ribbon Cutting will be held October 31, 2:30 - 4:30 at BSC Ventures/Double Envelope Front Lawn, 7702 Plantation Road. Tru by Hilton: Ms. Loope stated she is working with Kirtesh Patel to schedule a Ribbon Cutting at Tru by Hilton. NEXT SCHEDULED MEETING The next scheduled meeting is November 14,2018 ADJOURNMENT The meeting was adjourned at 11:00 a.m. Respectfully submitted, Ji Loope Secretary-Treasurer