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HomeMy Public PortalAbout1994_11_01SPECIAL MEETING MINUTES OF NOVEMBER 1, 1994 A special meeting of the Leesburg Town Council was held on November 1, 1994, in the Council Chambers, 25 West Market Street, Leesburg, Virginia for the purposes of considering the Letter of Intent between the Town of Leesburg, Gilbane and the County of Loudoun and to consider appointments of board members for the 501(c)(3) corporation related to the county complex. Notice having been delivered to all members of the Leesburg Town Council prior thereto. The meeting was called to order by Mayor James E. Clem. Councilmembers present Mayor James E. Clem George F. Atwell Frank J. Buttery, Jr. Jewell M. Emswiller Joseph R. Trocino Kristen C. Umstattd William F. Webb Staff members present Town Manager Steven C. Brown Director of Engineering and Public Works Thomas A. Mason Deputy Town Attorney Deborah Welsh Mr. Brown stated the main purpose of this meeting is to continue the review of the Letter of Understanding. Mr. Burroughs, representing the Gilbane Company, addressed the Council reviewing the comments made by town staff. Paragraph 1 - The only change was to define the term 'project.' Paragraph 2 - The word "tremendous' was removed. Stopped sentence on the 5th line down after the word 'trade." Struck "well in excess of $3 million contributed to the project.' Paragraph 3 - Remains unchanged. Paragraph 4 - Was a nonsubstantive change. Struck "to obtain the necessary government approvals.' It now says that the town agrees to promptly process and use due diligence in devoting necessary resources for all applications and other submissions for the capital P project. The second page dealing with 100 offsite parking spaces - The next sentence/third line added "but such spaces must be in close proximity to site two." The next paragraph contained some wording change but essentially it remains the same that was discussed on Friday. The January 17th date was included to give enough time so the Council would be able to act in the event the project did not close by the 17th in order to meet the March 15 deadline. The other change is in addition to the $3 million grant... "together with accrued interest if any such to the extent there is interest earned on the money during that period of time the town would receive the money back with interest." Paragraph 5 - Remains unchanged. Paragraph 6 - 2nd line... "on the site - site 2" - which is basically where the new governmental center will be - distinguished fi.om the Shenandoah building. Paragraph 6 a - Remains unchanged. Paragraph 6 b - The change says . . . "the town will undertake traffic modifications necessary to accommodate the traffic." Paragraphs 6 c and d - "previously discussed.' Paragraph 7 - The only change is - 'the small p to large P project." Paragraph 8 - "There were a couple of changes made on Friday at the request of Council - regarding the language for the agreement not to seek city status. In discussing this with the county - the county felt the word "principal" was something they had a hard time living with. The county is concerned with because the lease ran for 22 years they are willing to commit the 200 employees but the definition of principal and whether that is located at the government center or is it down the street or whatever. We made this change at the request of the county." Paragraph 9 - Needs to be addressed. Paragraph 10 - ~There was a concern raised by the Council as to whether or not the town could appoint the directors directly without having something in the bi-laws. The language agreed upon was to provide that the bi-laws of Gilco shal! provide that the town shall have the right to appoint the board of directors and the town agrees to delegate, etc. In addition, we have placed a fail-safe in the bi-laws of Gilco that in the event the town does not appoint then it would go by default to the chief judge of the Circuit Court in Loudoun County.~ Paragraph 11 - "The last sentence was stricken by the county. The county cannot indemnify Gilco or anyone else for environmental matters by law. Under state law the county cannot do it and they did not want the inference that if this was left in there - there was an inference somehow that someone could take a position some years down the road that in fact there was some law that allowed them to do that. This is more of a town issue then it is bond financing.' Paragraph 12 - The county is willing to allow the use of the parking off hours - site 2. Paragraphs 13 and 14 - unchanged. Mr. Trocino referred to the paragraph regarding city status and stated "I am confused on how a bi-party agreement between ourselves and Gilbane can bond and third party - that is really an agreement between two governments?" Ms. Welsh: "I'm not sure that it can. Mr. Roberts and I spoke this afternoon and agree that in order for something along these lines to be binding we need to amend the annexation agreement that is currently in existence and provide for an extension of the city status moratorium. There are also issues that the county will be executing which is to be attached as an Exhibit A. One of my concerns is that we don't have the Exhibit A as negotiated and agreed to by the county. Until we have that Exhibit A I don't think it is appropriate for the town to agree to the letter of intent. You may agree in concept but I don't think it is appropriate to agree to the letter of intent and authorize the execution of that until we have the letter of intent from the county. It is my understanding they are going to be taking action on that on the 16th of this month. One appropriate avenue may to be to add the County of Loudoun as a party to this letter of understanding and then those issues can be addressed within this as well. I believe the county has seen this letter of intent." Mr. Trocino: "There may be items that we need to polish with the county. For example on the city status. I find the location of the principal offices important but that is a matter of negotiation between the town and the county and not between Gilbane and the Town of Leesburg and yet it is in the document." Mr. Burroughs: "We are expecting to get a letter of intent signed by the county in the next two or three days. The lease would be signed on or by the 16th of November.' Ms. Welsh: wit is my understanding from Mr. Roberts that their letter of intent specifically states that the letter of intent is not binding." Mr. Trocino Suggested changing Mr. Brown's name to Steven C. Brown. Mr. Atwell pointed out that his middle initial is F and his address is P.O. Box 675. Paragraph 1: Ms. Emswiller: "Under paragraph one it says... This letter of understanding is entered into by the parties in consideration by the Town to Gilco to be used for acquisition of the Shenandoah Building and related improvements located at Heritage Square... It was never my intention to use any of the money that we appropriated to be used for Shenandoah Square. Why is it worded that way?' Mr. Burroughs: "I think the purpose of that was to bring in the fact that there are two sites and that the $3 million is money that is fungible for the acquisition, construction and equipping.' Ms. Emswiller: "In my mind its equipping of the county complex site that is in the historic area. It has nothing to do with the Shenandoah Square site." Mayor Clem: "The Shenandoah Square site is a part of that proposal and it should be so stated." Ms. Emswiller: "I appreciate that Mr. Mayor but when we talk about contributing money to the county. "Mayor Clem Wee would not be spending any money at the other site." Ms. Emswiller ~I'hat is not what it says - it says we will." Mayor Clem "It talks about the project as a whole." Ms. Emswiller "It says in consideration of the contribution of $3 million by the town to be used for acquisition of the Shenandoah building and related improvements located at 102 Heritage Way, N.E., and the acquisition of certain property at 3 Harrison Street, S.E. I don't remember Council ever talking about or voting to give any money toward the acquisition of the Shenandoah building. All we talked about and determined to do was to have the county complex located in the downtown, historic area of Leesburg. There may be a reason why you have it that way and I don't understand it." Mr. Burroughs: "I think if you would continue reading on it says . . . including the acquisition, construction, furnishing equipment of a build-to-suit building to house the Loudoun County government center 'all this being the project'. So the town is not necessarily saying - I'm going to put $20.00 here and $80.00 there because the money would come into a bank account." Ms. Emswiller: "Is there any reason why the money the town is going to appropriate toward this project cannot be earmarked for the county complex site?" Mr. Burroughs: "I suppose it can. The problem is it is going to go into bank accounts and held by a trustee. I suppose we can change the bond documents and have a separate fund to keep track of that $3 million which creates some accounting issues and additional cost." Mr. Trocino: "In terms of understanding I have always thought it clear. If you take the whole paragraph together and focus on the conjunction and, together both sites and improvements comprise the project. The project is the very one we voted to support and to support financially. I knew that it was two buildings taken together and that together they become one project. I could see if you don't read the second part of the phrase that it appears that we are financing just the purchase of the Shenandoah Square building. In fact, I think the monies and the project are so commingled there is a unity to the project - Shenandoah Square on the northeast side of town and the government center building complex in the heart. I suspect strongly without the presence of the Shenandoah Square building the county government would not have chosen this site to be the government center." Mayor Clem: "I agree with you and that is why it reads on to say the project. It is all one project and yes I think we can feel safe that our monies will be spent downtown. That is a different building." Ms. Umstattd: "I think Ms. Emswiller raises a very valid concern. The original proposal did not include the Shenandoah Building. In fact, there was talk if they needed extra space they might go to Landsdowne - they might go elsewhere. My understanding of the Council's intent was that this subsidy was to beef up business in the downtown not out at the Walmart or the Taco Bell. I do have a problem in addition to the one Ms. Emswiller has raised - of having our money going to buy furniture for the county. Are they going to get a marble conference table or a granite one? I really don't think town funds should be used for that. If the Council is going to support spending money to acquire and construct I think that is fine but I don't think we need to be furnishing their building for them as well." Mr. Webb: "We have agreed to spend up to and no more than $3 million to get the county complex. Its all one project and if it includes part of the Shenandoah building or the county complex down here - its all one project. What difference does it make? I agree with Ms. Umstattd that we should not be spending it on marble top tables or furniture." Mayor Clem: "It says including the acquisition, construction, furnishings, equipping of a build-to-suit building. I agree with Ms. Umstattd that we are not into buying furnishings. It just happens to be that it is part of the overall project." Ms. Umstattd: "I would also like to make one comment along the lines of what Mr. Webb just said. The Council voted to spend $2.5 to $3 million. My impression was the intent was to get county workers back downtown to help businesses downtown. If part of this $3 million grant is going to subsidize the Shenandoah building as well and if we are then going to have to incur additional costs up to $3 million on top of this for road improvements, sanitary sewer, box culverts, etc. My impression is the original intent of the Council is not being met in this letter of understanding. That $3 million if it is going to be voted through should be used solely to subsidize this downtown complex and no other part of any project." Mr. Trocino: "I suspect, Mr. Mayor, the focus on the town's subsidy on the downtown site could never be anything else but a subsidy for totality of the project because a dollar not spent here for them is a dollar spent out there. If its only a question of wording maybe we can change it around. They are locked together. This is one project." Ms. Umstattd: "In response to Joe's comment we can easily spend $3 million simply on the road improvements and utility line hook-ups that are being asked for in this for the downtown part of this project." Mr. Buttery: "I would agree with our Council with respect to the last several lines of paragraph one indicating that we are subject to the letter of intent which we still don't have a copy of. In my opinion we have a problem there. We need to see what that letter of intent spells out. That is a major problem that I have with paragraph one. In addition, with respect to various sentiments on the Council as to where the money goes between the downtown site and Shenandoah Square. I agree and disagree with both sides. The resolution passed on June 29, indicated that the Town Council voted to contribute $2.5 to $3 million in financial assistance to encourage the county to locate its government center in downtown Leesburg, however, I don't disagree that it is a coupling arrangement. It is important for the citizens of the town and for us as a Council to have it clearly where the money is going to go and how it is going to go. With respect to paragraph one - when they are talking about the $3 million contribution - then go over to paragraph four - I had an initial question that they did not really talk about site one and what would happen if some problem occurs with respect to closure on site one. They did not really address the issue of where the $3 million would go then. I had a major concern with what if site one, for whatever reason, failed to close under the original language - now reading paragraph one and four together - in the original version of paragraph four there was no indication of what would happen to the funds if for some reason site one failed to close." Mr. Burroughs: "If site one fails to close then the whole project would not close. If the property has been rezoned then you would have until March 15, to rezone site two. The site two issue gets to the question of the current owner who wants to make sure that if the transaction doesn't go through he is able to do what he is doing there today. If the property got rezoned to GC as opposed to overlay - if you over laid it then its not an issue because he can still do what he is doing there. But if you don't overlay it and you then change the zoning to GC then any other use is going to be a problem. He doesn't want to go through with it unless he can have his property back rezoned because he is left in never, never land with property he can't use. That is why we have more particular language dealing with site two then site one. Site one is basically now just an office building and continues to be an office building." Mr. Buttery: "I think with this new letter that may address some of those concerns. Reading over the original memorandum of understanding I had a real concern about what if something did fail on site one and then what if Mr. Echols decided no it was still a good deal for him and he wanted to go through with it and we did not have a fall back position with respect to an escape clause." Mr. Burroughs: "In other words if you rezone by March 15, your obligation ends. Presuming that you have rezoned it in the first place. We can take out the last sentence in the first paragraph.~ Mr. Buttery: "I would be in favor of doing that." Ms. Umstattd: "There could be a down side to removing that sentence in its entirety which is we don't have to pay the $3 million unless certain conditions are met and those conditions may in part benefit the town. There may be two sides to this removal." Mr. Culbert: "The intention in paragraph four is that if the transaction itself which is the project which in terms of the RFP/the response back to the county included by definition both sites - if that transaction doesn't close - the deal doesn't close and you rezone site two back to its current zoning then the money ... (tape is unclear). That is where the failsafe, if you will, is to that grant. Until that time that money stays in escrow." Ms. Umstattd: "Where is the paragraph that talks about the $3 million being held in escrow until March 15, 1995. Mr. Culbert: wit doesn't explicitly state that but paragraph four clearly states that the $3 million comes back with interest." Ms. Umstattd: "I agree it says that - my concern is if Gilco goes belly-up and Gilbane goes belly-up and I know Gilbane isn't going to do this but still we could be out our $3 million with no one to go after except George Atwell and I'm sure he doesn't have it. I think it would be better for protecting the town. if there were specifically an escrow paragraph, whereby the $3 million would be held in escrow until time as we might get it back. If March 15, 1995 is the deadline on the rezoning otherwise you may use' it and the rezoning may not occur." Mr. Burroughs: "If the public financing closes then this issue becomes moot. This is why the January 17th date is in there because if the project doesn't close by January 17th then the Council has the opportunity to rezone the property and get its $3 million back. The money is in escrow until the project closes." Mr. Buttery_: "But does it say that?" Mr. Culbert: "In this letter of intent the phrase escrow does not appear." Mr. Buttery: "Not only do we want strings attached to the money we want logs, chains, cables - I want to know where the money is." Mayor Clem asked Ms. Welsh what her opinion is with regard to striking the last sentence in paragraph one? Ms. Welsh: "Since I have not seen the letter of intent I do not know whether I want it to stay or not. I may like it to stay if I see the letter of intent but without it I cannot advise you. I have assumed there may be conditions that would be beneficial to the town in regards to their signing a lease or their intent to sign a lease for a term that is acceptable to us. That they intend to appropriate monies for rent and if they don't appropriate monies for rent they might not be able to lease any other space within the town. I would think that some of those issues would be addressed in a letter of intent and those may be beneficial to the town. We may want those conditioned and we may also want, on page 2, the paragraph which Mr. Culbert has revised - rather than just saying that if the transactions contemplated by the letter of understanding fail to close - we may want that to be that the parties, not just the town, but the parties agree that if all the conditions provided in this letter of understanding are not satisfied by January 17, 1995 and if site two is not zoned B-1 then that property would be transferred to the town. Of course that would be by general warranty deed with English Covenants of Title which are not provided in there - and in addition to any accrued interest that would come back to us. We would want to insert that any cost that we might have incurred as a part of this project would also be reimbursed to us. Bond Counsel's charges - we may want to make provisions for that." Mr. Atwell: "Back to the last sentence in paragraph one - the town's $3 million grant is conditioned upon - that means to me that the grant is not going to be given or made - conditioned upon - upon what - satisfaction of the conditions contained in the letter of intent by and between Loudoun County and the developer of the acquisition of sites one and two. To me that means whether we have seen it or not - and I too would like to see it - but that grant is conditioned upon our satisfaction with that letter of intent." Mr. Burroughs: "That is true." Ms. Umstattd: "But it is not our satisfaction - it is satisfaction of the conditions. It doesn't say satisfaction to the town. Its if they meet the conditions. Whether or not they meet them to our satisfaction is not addressed." Mr. Burroughs: "Right." Mr. Atwell: "All right, can we put that in there - the town's satisfaction." Mr. Burroughs: "Sure." Mr. Atweil: "Does that tighten it up? The grant is conditioned upon the town's satisfaction of the conditions." Ms. Umstattd: "Well no, you want to rephrase that a little differently. The town's grant is conditioned upon satisfaction of the conditions to the satisfaction of the town. Its going to be a long convoluted sentence." Mr. Atwell: "If what we mean or want is that we are not going to give up the money until we are satisfied - we the town are satisfied that this letter of intent between the county and the developer meets our requirements and if we can say that then why not lets try to say that. If that is agreeable to everybody, I hope we can agree on that right now and move on to the next thing and not have to pick up on it again at some future point and say no that is not what I meant or that is not what I intended." Ms. Welsh: "That is fine - I still want it attached - which is attached rather than will be attached." Mr. Burroughs: "It will be conditional approval for a document that would be delivered at another date - hopefully within the next two or three days." Mr. Atwell: "I think the point, according to Debbie is the county has been privy to what is in this letter of intent up to this point at which we haven't approved it and they have made some - offered some concerns about what we have in it. I would like to have the same opportunity to maybe offer some concerns if there are any about theirs. Even though this language may clear up what we are trying to avoid." Mr. Burroughs: "Okay." Ms. Welsh: "On the first paragraph which is an introductory paragraph, I have the same concern that I have had, in that, rather than having Gilco Corporation a to be created 501 (c)(3) corporation that actually be and Gilco Corporation a 501 (c)(3) corporation and that this letter of intent not actually be signed until Gilco is an entity. The reason for that is that when we make a contribution, we are making a contribution to a charitable organization and the town has to make their contribution to a charitable organization that is already existing. It cannot be a to be created. We need to be sure that it is created so we are in compliance with 15.124. I would prefer that entity actually be created. Mr. Burroughs: "It has been." Ms. Welsh: "Great, then we can change that to reflect exactly what has happened and that takes care of that concern. We need to make the consistent change as well on 3, where it says.., which is to be formed - you can put.., which has been formed. You also need a signature line for Gilco." Paragraph 2 - Economic benefits. No comments. Paragraph 3 - Gilco. Changes as made by Ms. Welsh. Ms. Welsh: "I have another change. Here or somewhere in the document there should be a sentence added that the town should be provided with a copy of the charter of Gilco which states that such entity provides services to the residents of the town prior to funding of such $3 million. This is in compliance with that section of the code." Paragraph 4 - Corporation. Mr. Brown: "I did speak to Benton before the meeting and the best we can do on getting the actual funds to him according to the schedule set up right now is 11:00 a.m., on November 30th, instead of November 28. I assume we can provide assurances and a signed resolution but according to the schedule we have adopted right now we can actually have the money to them at 11:00 a.m., on November 30." Ms. Welsh: "I do believe that this would be the appropriate paragraph to insert in the escrow provision. We can get together on the language." Mr. Brown: "What the Council is looking for is where the money is going." Ms. Umstattd: "I'm not in favor of the offstreet parking. In my mind the $3 million that the town was willing to support really was for infrastructure that the town would provide and since they have asked for the $3 million as a contribution in addition to the infrastructure I'm not comfortable with that and I am not comfortable with providing 100 parking spaces forever at no cost." Mr. Buttery: Wv'ith respect to the county having use of 100 spaces - I think there should be some kind of protection for the town that these spaces are not used to warehouse or store county vehicles on weekends, holidays, when the town can be using those spaces." Mr. Burroughs: "They are going to use the 100 spaces for employees and visitors." Mayor Clem: "There should be a sentence that identifies that those 100 spaces would not be used for those purposes after hours." Ms. Welsh: "In the traffic impact analysis for the proposed Loudoun County Government Center it states on page 6, in conjunction with the proposed project the county expects to have access to approximately 100 parking spaces in the town parking garage. These spaces will be used to provide parking spaces for county owned vehicles. These vehicles will be used for official county business and will not be used for employee parking. Which I assume could mean for storage." Mayor Clem: "For that reason we need a line in this agreement that says that will not occur. That was not the intent nor the spirit of this Council's." Mr. Brown stated vehicles could be stored at Liberty Street. Mr. Burroughs: "That will be resolved. It is an error. The drafts of the letter of intent that we have with the county - that same language is in there and there has been no question by anybody at the county perspective." Mr. Trocino: "This is not a tri-party agreement. This will not matter until the county comes in and they agree. They are the ones who are going to park there." Ms. Welsh: "Perhaps we can provide that they are specifically not to be used for storage of vehicles and I think that takes care of it. No parking after hours." Mr. Burroughs: ~The only issue I would say you have with that is you have the word visitor. So when you have a visitor that comes in at 4:00 p.m., and goes to the government complex and then leaves his car there and goes to dinner." Mr. Buttery: ~Fhat's not the problem. We are just talking about county-owned vehicles. Let all the visitors come and park. Also in paragraph four, first line - the town agrees to promptly process and then the word promptly is used later. I don't know that it is a big issue but that is subject to interpretation and it is certainly the intent of the staff and Council to move as quickly and expediently as possible but if something were to happen and all of a sudden we're not real big friends and buddies anymore - which I know will never happen." Mayor Clem: 'q'he word promptly just got stricken." Ms. Umstattd: "Paragraph four - why was the section relating to the seller's possible default eliminated?" Ms. Welsh: "Based upon our discussions today, it was my understanding that at the same time the funding is done for the COPS the property is going to be acquired. The property should already be acquired prior to January 17. There should not be any avenue for there to be any default by the seller of site two. If that is the case and if we are providing - that if the conditions provided are not satisfied by January 17th then one of those conditions - whether it is through the fault of the seller or not has not been satisfied. Your money either has or has not been used. If the site has been purchased then the $3 million has been used. Maybe a portion of it has been used to purchase that property so then you have a deed to come to you which again would be general warranty with English Covenants." Mr. Buttery_: "With paragraph four I think the town is pretty well protected if a default occurs before January 17. Can you imagine any potential problems occurring after January 17 that would in any way affect the $3 million?" Ms. Welsh: "I don't know but if we change it to say that if the parties agree that if all the conditions provided in this letter of understanding are not satisfied by January 17, 1995 then we will certainly know." Mr. Burroughs: "Once the deal is closed its closed. The ability to come back in there and unwind it - we will never get the bond financing." Mr. Culbert: ~The contingent liabilities have to be removed at closing." Ms. Welsh: "Also in paragraph four where you have your funding on or before November 30, 1994 such later day as otherwise agreed by the parties hereto. If we are going to leave the last sentence in paragraph one it should be 'subject to paragraph one' after that - because you want to be sure that the satisfaction of the conditions have been taken care of in the last sentence of the letter of intent." Ms. Umstattd referred to the last line of paragraph four, second paragraph of the letter of intent which states.., together with accrued interest if any... She asked if the Town should require that there be interest?" Mr. Burroughs: stated it will be in an interest bearing account and that language would be added to that affect. Ms. Welsh stated she requested that it be returned with the interest the town pays on the bond anticipation notes (BAN). The $3 million grant be returned with the interest at the rate of the town's BAN notes together with any cost. Mr. Burroughs: asked where is the money going to come from? It can be placed in an interest bearing account but the rate cannot be guaranteed. "If we receive the $3 million, close with Echols but have not dispersed, we don't close on the project financing, for what ever reason, by January 17, 1995 the Council at that point has a choice - it can say we would like to own the property whereby it does not rezone by March 15 - then it would get the property and the remaining portion of its money back. Or it can choose to rezone the property and get the $3 million plus whatever interest is accrued. If the town puts up the $3 million - we close with Mr. Echols and we close the project then this is irrelevant. This is only in the event that we have closed with Echols - we don't close the project financing and Mr. Echols' property has been rezoned. The likely event is the property is rezoned we close with Echols and we close the project - that is the 90 plus percent. Less than 100 percent but very small is the money comes in we close with Echols but we don't disperse. Under our agreement with Echols right now - our intention is not disperse - he needs a period of time to have the tenants to stay in through the Christmas holiday. From the bond financing we can't close the bond without having a deed." Mr. Trocino: "You have the ability in your relationship with Mr. Echols to close and take title but not disperse the funds?" Mr. Burroughs: stated that is correct. "We lease back to Mr. Echols for 30 days so he can get the tenants out and take him through the Christmas holiday. The tenants get out the first week in January - he then gives us back the property and we would disperse the money." Ms. Welsh: "It was my understanding that the reason we were putting all this language in is that Echols had a problem in the property being transferred. He did not want to transfer it if it was already rezoned because he might be getting it back and it might be zoned. But if the deed is being transferred anyway to Gilco then I don't see why any of this needs to be in there about having to come back and rezone it because Gilco will have the title to it anyway. If you are closing the transaction and Gilco has a title to it and your just not funding the $3 million until later - then why do we even need the language in there - that if the town doesn't rezone it back because Gilco will already own it.' Mr. Burroughs: ~'Fhe reason is the town can then make a decision about whether it wants the property if the deal hasn't closed or it wants the $3 million back. Without this in there they wouldn't have that right - that's the distinction. The town can decide on January 17, all the way up to March 14, assuming this remote event happens it either gets its money back with interest or it can have the property to do whatever it wants with it. This is a much better benefit for the town because it gives the town an ultimate flexibility of deciding based on the facts it has then.' Ms. Welsh: "I find it very difficult to believe that somebody is going to transfer the deed to you and your going to record that without any money in hand. I did not know that Mr. Echols would agree to transfer property without money in hand." Mr. Burroughs: 'But he is getting the rights to the escrow." Mr. Buttery "What if we get into a situation where we are in the position of either rezoning the property back to get out money back or keep it as it is and we have the downtown site without the county complex. What if for some reason Mr. Echols feels that whatever the purchase price is for his property is a good deal - are there any monkey wrenches that can be thrown in our rezoning process to rezone it back to the status that it is now. Can a party come in and in some way slow down the process - stop our wheels from turning all together with respect to rezoning?~ Mr. Brown: "My understanding of the state law is the Town Council has the ultimate authority on zoning property." Ms. Welsh suggested adding language where it states.., rezone the site back to its current existing zoning classification by March 15, 1995, which shall not include any time periods for the right of appeal. "So this is based upon an action you take but not based upon any appeals or whether or not it might be overturned in a court." Mayor Clem pointed out that nothing was changed in Paragraph 5. Paragraph 6 included Mr. Mason's changes. Ms. Emswiller stated there is a list of the different costs involved and asked if these costs would be discussed separately or paragraph by paragraph? Mayor Clem stated this will be looked at later. Ms. Umstattd "Even if the town were not to make the improvements listed in 1 a, b and c in the list, we are still looking at $2 million to almost $3 million on top of the $3 million grant.' Referring to the October 31, memo in addition to the previous memo. She expressed concern that not all the information has been received. She stated "I noticed that in paragraph 6 we are no longer making one-way pairs - at least we are not agreeing to that explicitly. Does staff have any information as to whether we can meet out traffic needs without one-way pairs? Mayor Clem stated this is in the traffic study that was provided to the Council. Ms. Umstattd "The traffic study is not as complete as I would have hoped it would be.' Mayor Clem "There is also a response that Mr. Mason prepared." Ms. Umstattd "A previous meeting Councilmember Webb expressed concern that if the town were to pay for all utilities it could be an additional $1 million - presumably this would be on top of the total cost of perhaps $6 million between the $3 million grant and the $3 million worth of infrastructure improvements. If the utilities will add another $1 million on top of that - we are looking at a $7 million town subsidy for this project." Mayor Clem "If we are talking $7 million you got one vote right here that will be against it.' Paragraph 6 a - water line, sewer line and box culvert. Mr. Mason "The box culvert and the sanitary sewer line currently run through the site and are at the location at where the building is planned to go. They must be relocated so that they are not under the building in the future." "We have estimated, based on the size of the box culvert and the length to reroute the box culvert, could run as high as half a million dollars based on the pricing and cost that we incurred on a smaller box culvert a few years ago near the western Y." "The sanitary sewer was planned for replacement and is capital project no. 85 in the CIP. That project did not call for relocation - so it would have put a bigger line in at the same spot. To put a bigger line in at a new location similar to the box culvert - we estimate it to cost about $150,000 versus the $95,000 previously in the CIP." "The water connection - the existing water lines all around are only 4 inches. Those lines cannot provide the required fire flow and domestic flow for this proposed facility. A connection to the 12" main in Edwards Ferry Road has to be made. Our estimates are that would be an 8" line and would cost roughly $60,000 to run the 8" line from Edwards Ferry Road over to Loudoun Street to close the loop. Included in this is the pipeline that would go up to the property line to feed the building. This is the same for the sewer line project." "The $150,000 would come from the utility fund, the $500,000 - the only source of funds would be general funds or bonds or whatever financing the town can come up with. The water line could also be considered a utility system project. Utility fund monies could be allocated to that if the Council so desired." He then explained the two categories in his memo of October 13, 1994. Ms. Umstattd pointed out that the project total was nearing $6 million. Mr. Webb asked if any monies were included in these totals for the relocation of power lines, telephone and TV lines? Mr. Mason "No. The lines that staff is most concerned with are the overhead telephone lines along Church Street. Staff does not know exactly how close the building will be. Staff has made no provision for placing overhead lines underground." Mr. Webb asked if most of the pole lines are on town right-of-way? Mr. Mason stated yes. Mr. Webb asked if the utility companies have the right-of-way on municipally owned property and if the utility company has to relocate at their expense? Mr. Mason "Yes if it is in the franchise agreement. However, they have never interpreted or agreed that it would include undergrounding. If there are overhead lines they have said they would consider moving it and keeping it overhead at their cost. They have always resisted converting overhead to underground." Mr. Buttery asked Mr. Mason if he would foresee a need to reroute the power lines? Mr. Mason "Staff is uncertain at this time whether any of the lines will have to be relocated or at worst - placed underground." Mr. Buttery "There are additional costs that the town must be cognizant of. I don't know that we can contribute all of these costs, such as the widening/improvements to East Market Street as a result of the downtown county complex." "With respect to the offsite costs - one-way pairs, removing the hump in West Market Street and providing special signals - those are costs that may not be born out at all. I agree with Ms. Umstattd that the $910,000 figure - that whether the town gets the funds or not from the Tee that is speculative - I don't know that we can say that the $910,000 should be or can be solely attributed to the county complex site." "With respect to the adjacent cost - in my opinion we could basically eliminate as far as direct cost to the county complex site are the offsite improvements right now. With respect to the relocation, upgrading - that is in the CIP so we could say that is cost associated with the county complex but is also something we were going to have to do in any event. The relocation of the box culvert - I have a problem with that." "The improvements to Harrison Street, will have to be done and we can attribute most of that to the county complex. Does the curb and gutter need to be done on both sides of Harrison Street at the same time? The improvements to Church Street are about $180,000 - that may be one of the areas that we may want to instead of 'improving it', would be keeping it the way it is - possibly eliminating the parking facilities on Church Street and keeping it as part of the charm of the downtown area. I can envision it as being a pedestrian way. To know that it is going to be used as ingress/egress for the garage - there is room for discussion - that may not be a cost that we have to bare out.' "The improvements to Market Street adjacent to the site, I agree that it needs to be done when the complex is built but I would also say that this area has been without sidewalks forever. In my opinion sidewalks should be there now." "The improvements to Loudoun Street can be attributed to the county complex. The possible traffic signal at Church and Market Streets - if we don't do any alterations to Church Street we may not have to place a signal there. We may have to look at possibly closing Edwards Ferry Road onto Market Street because this is a bad intersection which needs to be addressed." "The new street lighting needs to be looked at. With the county complex - there will be some lights born out from the building.' "Connection to the waterline. Does the 8' waterline have to go to Loudoun Street or could it go to Market Street with a connection to the building right there?' Mr. Mason 'By running the line to Loudoun Street you essentially gain the advantage of tieing into the other smaller lines to help feed the line that will feed the building." Mr. Buttery 'With respect to the connections of the utilities this is something that the Council needs to look at and possibly the county could address Gilbane on this issue. That could eliminate $25,000- $30,000. The fact that the county complex will increase sales and foot traffic. The statistic is that the town is responsible for 32 percent of the tax revenue that the county receives with respect to sales and the town only receives 9 percent back. The town gets back about $800,000 - $900,000 and the county gets $2.9 million from sales generated in the town. I suggest the county take care of the utilities.' Mayor Clem asked if the box culvert could be located on the western portion of the site? Mr. Burroughs: "I believe with regard to how the site is master planned as well as the preference from the town's engineering department that it would be best to have the box culvert stay within the street right-of-way. We have looked at other alternatives trying to move it to the west. The problem is effectively you would have to grant air rights over the box culvert for the purposes of future expansion of the county complex. That would be problematic from a maintenance perspective although we would still provide access for the purpose of allowing the culvert to be maintained in the sense of having a backhoe come in. We will be starting in one location - at a second story for an expansion coming down Loudoun Street. When you start looking at maintenance and access to it, it was preferred by the town to have it stay within the street right-of-way.' Ms. Emswiller: "Was part of that because at some time you expect to have expansion? It is anticipated that it is the town's choice based on what you intend to do in the future?" Mr. Burroughs: "What the county intends to do? That is correct. The county is reserving the right on their preliminary site plan to expand that site." Ms. Emswiiler: "If the county did not expect to expand then the town might not have come to the same decision?" Mr. Burroughs: "That could be the case but I think part of the provisions of this transaction were along the lines that the county has the right to expand - looking at this for a long term home. Ideally, what you would like to have been able to do is to leave the culvert where it presently lies. It has been looked at fairly well from a point of view of where is it best to put it. It is a big culvert. You are diverting a lot of storm water. You have old streets with a lot of utilities within them. It is not an easy solution no matter what one does. To get the highest and best use whether it is the county using this property or some other entity - the highest and best use of this land to generate economic development within the Town of Leesburg. That culvert takes a major swath out of this land. I realize the easement is 40 or 50 years-old. It was done with the anticipation that, that land is the highest and best use but this town and county has matured and now that land has higher uses - higher economic and other social uses for the Town of Leesburg and to that degree that culvert will always impede the development of that property. There is nothing one can do. That is the only piece of property within the historic district of downtown Leesburg that gives you 2.5 acres of contiguous land. There is no other place that you can build this building in the historic district of Leesburg. The culvert is a fact of life - it sits there. It is difficult to try to engineer it any other way. Clearly some of the improvements mentioned by the engineering staff - the improvements that need to be made regardless of whether or not this county facility is ever built there - to the extent that you need to continually update your infrastructure to address the growth of the town. Obviously there are certain improvements that are directly related to that. We are a conduit in a sense of putting this together. We have absolutely no ongoing economic benefit of this transaction. This transaction is basically a dead transaction to the extent when it is complete to the degree of we have done our job properly we will have made ourselves a development profit but it is very marginal at this point to the extent that it costs more - its our expense in the sense of the overruns associated with it. I realize there is a threshold as to where it makes no sense to continue to support this. When you start to identify the projects that are effectively, directly caused by the development of the county facility, one could look primarily at the water - to the degree that I need that water for purposes of providing the fire/life safety to the building. The box culvert clearly needs to be moved because there is no true solution that keeps the culvert where it presently is located or moving to the west on the site. The sewer to the degree that it is a CIP and is already in your budget. It is still something that needs to be done in the sense of upgrading and relocating it - once again it runs across the center of the site. We have labored over this for weeks or probably months to some degree. The Mayor's comment last week is something that we have taken seriously. We have tried to figure out how to try to assist. I would like to say today that I could just pay for this. I can't. I don't have the capacity within the budgets to permit that to happen nor do I believe that we would be successful going back to the county and requesting the county to pay for this. I believe that the county from their perspective felt this was part of the transaction that has been proposed to them. I am willing based on information that we have received from our engineers as well as town engineers and further understanding these issues - putting a cap on this. I would basically say that in that sense that the cap would be preferenced to the existence of unknown conditions. If I started to dig in the street and I fell 200-foot down I would obviously want to come back and have some relief. I think that, based on what we understand now that is a very remote situation. I believe that we would take the responsibilities to deliver the box culvert, the sewer and the water line. My understanding of the box culvert relocation is about 640-645 linear foot of relocation. The water line is approximately 1040 foot. As I understand it now and Tom can confirm these, I think the sewer is about 460-foot. All told without contingency on that Tom was referencing numbers of about $710,000. We would be willing to limit your exposure of that to $450,000 and we would be responsible for any cost above and beyond that. I would like to say I would help you on your road construction. I really can't. I am not in the position to improve your infrastructure from a traffic perspective in town and the transaction was never intended to do just that. This is about the best I can do at this point in time based on the conditions that I understand the county to be at and where the overall condition of the project stands. I would agree very strongly with your observation that Church Street should not be improved. It is not considered and Tom can support this or not - it was not considered in the traffic analysis as a major thoroughfare of feeding the garage what so ever and as you pointed out it adds clearly the historic ambiance to the town and as far as we are concerned it can stay just the way it is. It does not affect us one way or the other." Mr. Webb: "If no work is done on Church Street as far as the power, telephone and TV is concerned none of it needs to be taken care of. Market Street and Loudoun Street they are both on opposite sides." Mr. Burroughs: "Yes and quite frankly I realize you want to do what is necessary now to support this project but technically some of these things that you are suggesting to be done can be done into the future. They do not need to be necessarily done to get this project completed. Such as things you want to improve in streetscapes and things of that nature. You have a threshold as to what one can do in capital projects at any point in time and in any one year. I would suggest you prioritize those. The projects that need to be done to support our project are the ones I identified. Specifically, except for the improvements that have to be done to the highway system. In that sense there is a turning lane that needs to be constructed moving west on Loudoun Street that will be basically a stacking and turning lane into the garage. We will deed you the property to permit that to happen but the construction of that would obviously fall upon, at this time, the Town of Leesburg. Also the signalization of Edwards Ferry Road and Market and Church Streets to the extent you choose to do that. Once again if you are going to continue to support this type of economic growth in the town you have to provide an infrastructure to do that. If we had a residual interest in this project we would probably view it quite a bit differently but we are nothing more than a conduit - we are making business decisions based on what we can and cannot do. Effectively the transaction and the value of this reverts back to the town and county." Mr. Burroughs: "What I would be willing to pay is effectively $450,000. I'd cap the town's expense at $450,000 to the extent that if it costs more it would be my exposure. That would be for the relocation of the box culvert that would basically run east on Market Street to south on Harrison Street to west on Loudoun Street connecting to the existing culvert currently within Loudoun Street. There is approximately 460 linear foot of sewer line that is a 12" pvc line that is going to connect some place on Edwards Ferry Road down to Loudoun Street. Approximately 1040 linear foot of 8" water line. Those improvements that are necessary to be done and done timely so we can get on to the site and build the county facility. Secondly they are improvements that are related to our project in that sense. I am willing to cap the town's exposure to $450,000 which would be for the construction and engineering of those improvements. I would look for you to carry your own inspection in that sense. You could basically put that onus on us as an additional scope for that amount of funding." Mr. Mason: "The lengths of the lines that were just referred to, our calculations and estimates are based on a water line that is an 8" diameter ductile iron pipe approximately 600 feet long A sanitary sewer line, 12' pvc or some other material approximately 1160 feet long and a box culvert with a 4'x8' cross section approximately 640 feet long." Mayor Clem: "I think we need to revisit the memo of October 31, 1994. There are some awfully large numbers in here that do not apply to this project but in fact they are things that will have to be done some time in the future. A good example is the East Market Street widening - $910,000 that has nothing to do with this proposal." Ms. Emswiller: 'If we are going to look at that memorandum please start at the top and work down." Mayor Clem: 'I don't plan to do it tonight. We need to sit down and go through it and get it right. I have talked to various people here in town - town office and the numbers don't match exactly what I have there." Ms. Emswiller: "Some of the figures will come out because of not doing the one-way pairs." Mayor Clem: "One-way pairs - this is something we need to look at - the traffic study and understand it. Once that is identified all these big numbers on traffic start to fall away. I have discussed this in the town hall and have worked out a lot of the figures and cannot come up with these devastating numbers that I am hearing thrown around. I want a better explanation before I go any further. If your going to do widening and improving fi.om Y to Y and all that - yes - then the numbers are probably correct." Mr. Atwell: "The additional information that we received tonight including the offer made by Gilbane to cap those three projects - there are a number of things that have changed. It significantly reduces whatever magic number up there that we have been talking about. Mayor Clem: "It is the desire of the town to acquire or obtain in some fashion that property where the burned-out house is on Market Street and cut that through so that you do have an entrance from Market to Edwards Ferry Road. Ms. Bange has been good to the community to allow us to use her property to transition from Market Street over to Edwards Ferry Road. Someone, someday, sometime will buy that property and have a different view. If Church Street is okay then it is a matter of tieing those electric lines into that building in some fashion and eliminating some of those poles - just cosmetics down through there. I'm not saying it doesn't need to he capped with asphalt and maybe some road work done but the entrances as I have seen now which one time was going to be on Church Street but now all on Loudoun Street puts a different view and a whole different perspective on the picture, thereby lowering some exposure. I really think we need to sit down and go through these expenditures one more time to make sure we have a better feel." Mr. Atwell: "Virginia Power already has a pole that has three large transformers on it that serves that property. That pole is already sitting on property that is going to be purchased.' "It seems to me that paragraph B under item 6 needs to be reworded to say.., traffic modifications to accommodate traffic to be generated - but remove . . . will also undertake all needed repairs and improvements to Church Street. Paragraph A needs to include the cap of $450,000." Mr. Buttery: "Paragraph 6, with respect to removal and closure of that box culvert, I don't know why the town should have the responsibility of going in and removing it. It would be an additional cost to the town but if you guys have equipment there it would be a relatively minor expense.' Mr. Burroughs: Agreed. Paragraph 6, item C - no discussion. Paragraph 6, item D - no discussion. Paragraph 7 - minor change. Ms. Welsh requested the removal of the word 'approved" on the third line or identify the concept plans for the project. ~The plans that were submitted to the county. There have not been any approved concept plans for the expansion. Attach the concept plans.' Paragraph 8 - City status. Mr. Burroughs: stated this paragraph will be in the Letter of Intent. Mr. Trocino: "We can deal with it - and when we deal with it maybe we ought to do some word crafting as to what principle offices are really meant - administrative type quarters which is the built of their volumes of people. Today Mr. Barton was talking about the location of the board meeting room and the county administrator's office. Those are the offices we have all envisioned seeing here. If the day should come that they are no longer there then we should be, in my view, pursuing other forms of government." Ms. Welsh: "Where it says.., owned by Gilcorp... We define that as on sites one and two. Mr. Buttery: "Do we want to indicate the 200 employees will be at the downtown site as opposed to inclusive of Shenandoah Square?" Mr. Burroughs: stated there are 200 total at both sites. Mr. Trocino asked what the maximum number is for the downtown site? Mr. Burroughs: stated that estimates are about 450. Paragraph 9 - changes have been made. Paragraph 10. Mr. Culbert: "What the current draft has - by the first year there would be one year terms and then staggered terms of two and three years would start." Further discussion on this matter was referred to a special meeting of Thursday, November 3, 1994 at 4:00 p.m. Ms. Emswiller: "I still have a problem with the town delegating or negotiating for one council person to Gilbane. It has nothing to do with the individual involved at all. In my view it is probably better if that is either the town manager or legal staff. It may not be as important to the rest of the council as it is to me. If we met at the county level with a developer or whatever we always met in two - two people - planning commissioners, two board of supervisors and a staff member if at all possible. It protects every body involved to do that. It is more appropriate." Mayor Clem: "Generally what we have done here is - its a member of council, town manager and most often the town attorney. He has been the councilperson that has been identified to serve or to participate in that function along with the town manager." Ms. Emswiller: "It doesn't say that. It just says the town council person. This only mentions one person by name. I think that is a disservice to the councilperson whomever it may be." Mayor Clem: Mit may be but you can't serve seven masters. I expect one person to try to focus on the problems, identify them, get them back to the council level. Negotiating is sometimes nothing more than being the messenger. Ratifying will be done by all members of the council. No one single person on this council has the authority to sign anything - including myself. I surely don't sign anything without Ms. Welsh's approval prior to." Mr. Trocino: "It seems to me that has been our policy all along since I have been on the council. To have one of us share responsibilities and bring it back. It is a matter of trust that we have in each other. Kristen represents us at the NVPDC and I can trust her judgement to take care of Leesburg's interest. If there is something important she has always brought it back for our consideration. That is how we have operated." Ms. Emswiller: "I take what you just said being a matter of trust. It isn't that I don't trust Mr. Atwell or anyone else and I don't think going to the NVPDC or any other meetings is quite the same as meeting with a developer who is developing a project. I see it as a protection for the individual as well as for council. We are a public body. Its a public policy. What we do ought to be done out here in front of everybody. If they want to have a meeting and have Mr. Atwell there and they want to make an announcement so that the press and public can be there if they want to that is fine." Ms. Umstattd: "I think Councilmember Emswiller raises a good point. She has expressed some valid concerns. I don't know where the rest of the Council wants to take this whether you want to have a group of three or two Councilmembers plus the Town Manager or plus the Town Attorney. That might satisfy Councilmember Emswiller's concerns. I think it is a unique situation." Mayor Clem: "I personally have no problem with it. If there is anyone who has a better paragraph to put in there please let us know." Ms. Emswiller: "Is there a problem with it being the Town Manager and Town Attorney?" Mayor Clem: MI want someone on Council to be there. They are speaking for our $3 million. It is important." Mr. Atwell: 'q'here are two things here. One as Mr. Culbert pointed out that a large portion of that paragraph which may have created some of the discomfort with some of the Councilmembers has been stricken. It would seem to me as with any other commission that this Council creates that staff is a part of that commission and Council is a part of the commission without having to be named specifically." Mr. Webb: 'I have no problems with the three members that are there and I suggest we leave it as it is and move on to item 2. The Town Manager, the Town Attorney and Mr. Atwell.' Further discussion on this matter was referred to a special meeting of Thursday, November 3, 1994 at 4:00 p.m. Paragraph 11 - Environmental matters. Mr. Buttery: "I don't see why that is in there because the agreement shall provide that Gilcorp shall be indemnified and the County is deemed expedient or necessary that they can't provide that language - I don't see what purpose paragraph ll is serving." Mr. Burroughs: "Originally it was put in for the purpose of clarifying the question to make sure the town was not found to be negligent or at least it was not agreeing that absent their negligence or misconduct would be responsible for environmental. The second sentence was designed to put the onus on the County. The County has come back and said that by law they can't do that. They don't want that sentence in there because they don't want an inference in there that there is somehow some provision that might hold the County responsible. The part they objected to was as to the extent provided by law. They don't think there is any law and they don't want any inference that somewhere there might be. We have told them quite frankly that notwithstanding the fact that if they are occupying or using the property and they lease it and they do something they are going to be liable." Ms. Umstattd: "I prefer to keep it even though it may in the end not say this - I don't think it will hurt US." Mr. Buttery: "I agree." Paragraph 12 - Off hour/site free parking. Mr. Burroughs: "The County has indicated this is okay." Mayor Clem: "We may want to make reference that the county will not park county vehicles in those 100 designated spaces." Ms. Welsh: "You may want to add they are public parking - to define that it is not just for parking for the town's use but parking for the public." Mr. Buttery: "Going back to paragraph 6B. In thc first part of the paragraph., in addition, the town will undertake traffic modifications necessary to accommodate the traffic to be generated by the building on site two. I think we intended the same thing as determined by our town engineer. I'm not sure that as modified in here - as identified by the town or the town engineering - that pertains to Church Street. I don't want us to get into a situation where that is necessarily open ended and who would that be determined by?" Mr. Burroughs: "We can take the last proviso as intended - as identified by the town - and put it in the beginning of the sentence." Mr. Brown: "We will recompute that based on the fact that one-way streets are not going to be required and that we are not going to improve Church Street and that East Market Street will be funded as we anticipate." The meeting was adjourned. James E. Clem, Mayor Clerk of Council