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20-2188 Union District as an Urban Renewal Area and Justification CITY OF MERIDIAN RESOLUTION NO. 20-2188 BY THE CITY COUNCIL: BERNT, BORTON, CAVENER, HOAGLUN, PERREAULT, STRADER A RESOLUTION OF THE MAYOR AND THE CITY COUNCIL OF THE CITY OF MERIDIAN ACCEPTING THAT CERTAIN REPORT ON ELIGIBILITY FOR THE UNION DISTRICT AREA AS AN URBAN RENEWAL AREA AND REVENUE ALLOCATION AREA AND JUSTIFICATION FOR DESIGNATING THE AREA AS APPROPRIATE FOR AN URBAN RENEWAL PROJECT; DETERMINING THAT THE AREA IDENTIFIED IN THE REPORT IS DETERIORATED OR DETERIORATING; DESIGNATING SUCH AREA AS APPROPRIATE FOR AN URBAN RENEWAL PROJECT; DIRECTING THE URBAN RENEWAL AGENCY TO PREPARE AN URBAN RENEWAL PLAN FOR THE AREA TO INCLUDE A REVENUE ALLOCATION PROVISION AS ALLOWED BY LAW; DIRECTING THE URBAN RENEWAL AGENCY TO PREPARE A PLAN AMENDMENT TO THE DOWNTOWN DISTRICT PLAN TO DEANNEX THE UNION DISTRICT AREA; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City Council (the "City Council") of the City of Meridian, Idaho (the "City"), found that deteriorating areas exist in the City, therefore, for the purposes of the Idaho Urban Renewal Law of 1965, Chapter 20, Title 50, Idaho Code, as amended (the "Law"), created an urban renewal agency pursuant to the Law, authorizing the agency to transact business and exercise the powers granted by the Law and the Local Economic Development Act, Chapter 29, Title 50, Idaho Code, as amended (the "Act") upon making the findings of necessity required for creating the Urban Renewal Agency of the city of Meridian, Idaho, also known as the Meridian Development Corporation(the "Agency"); WHEREAS, the Mayor has duly appointed the Board of Commissioners of the Agency (the "Agency Board"), which appointment was confirmed by the City Council; WHEREAS, on October 8, 2002, the City Council after notice duly published, conducted a public hearing on the Meridian Revitalization Plan Urban Renewal Project, which is also referred to as the Downtown District (the "Downtown District Plan"); WHEREAS, following said public hearing, on December 2, 2002, the City Council adopted Ordinance No. 02-987 approving the Downtown District Plan; WHEREAS, on June 14, 2016, the City Council, after notice duly published, conducted a public hearing on The Ten Mile Road Urban Renewal Plan (the "Ten Mile Plan"). The public hearing was continued to June 21, 2016, for further testimony; RESOLUTION ACCEPTING ELIGIBILITY FOR THE UNION DISTRICT AREA AS AN URBAN RENEWAL AREA-PAGE 1 OF 4 WHEREAS, following said public hearing, on June 21, 2016 the City Council adopted Ordinance 16-1695 approving the Ten Mile Plan; WHEREAS, the Downtown District Plan and the Ten Mile Plan and their project areas are collectively referred to herein as the "Existing Project Areas;" WHEREAS,based on inquiries and information presented by certain interested parties and property owners, the Agency commenced certain discussions concerning examination of an underdeveloped area of approximately 16 acres in size and currently within the Downtown District Plan Project Area boundaries as appropriate for an urban renewal project. The area is generally east of Main Street, south of Idaho Avenue, west of E. 3rd Street, and north of the Union Pacific Railroad right-of-way. The area is commonly referred to as the Union District Area; WHEREAS,the City and Agency commenced certain further discussions concerning examination of the Union District Area as appropriate for an urban renewal project; WHEREAS, during 2019, Kushlan and Associates and SMR Development LLC commenced an eligibility study and prepared an eligibility report for the Union District Area, which area may be subject to de-annexation from the Downtown District Plan Project Area; WHEREAS,the Agency obtained Union District Urban Renewal District Eligibility Report, dated February 2020 (the "Report"), which examined the Union District Area for the purpose of determining whether such area was a deteriorating area and/or deteriorated area as defined by Idaho Code Sections 50-2018(9) and 50-2903(8); WHEREAS,the Report, a copy of which is attached hereto as Exhibit A, found the existence of one or more of the statutory criteria for the area to be considered eligible for urban renewal activities; WHEREAS, the effects of the listed conditions cited in the Report result in economic underdevelopment of the area, substantially impairs or arrests the sound growth of a municipality, constitutes an economic or social liability, and is a menace to the public health, safety, morals, or welfare in its present condition or use; WHEREAS, the Agency, on February 26, 2020, adopted Resolution No. 20-003 (a copy of which is attached hereto as Exhibit B and incorporated herein by this reference, without attachments thereto) accepting the Report and authorizing the Chairman, Vice-Chairman or Administrator of the Agency to transmit the Report to the City Council requesting its consideration for designation of an urban renewal area and requesting the City Council to direct the Agency to prepare an urban renewal plan for the Union District Area, which plan may include a revenue allocation provision as allowed by law; RESOLUTION ACCEPTING ELIGIBILITY FOR THE UNION DISTRICT AREA AS AN URBAN RENEWAL AREA-PAGE 2 OF 4 WHEREAS, the Report includes a preliminary analysis concluding the base assessment roll value for the Union District Area along with the base assessment rolls for the Existing Project Areas do not exceed 10% of the overall current(2019)taxable property value of the City; WHEREAS,pursuant to Idaho Code Section 50-2008, an urban renewal project may not be planned or initiated unless the local governing body has, by resolution, determined such area to be a deteriorated area or deteriorating area, or combination thereof, and designated such area as appropriate for an urban renewal project; WHEREAS, Idaho Code Section 50-2906, also requires that in order to adopt an urban renewal plan containing a revenue allocation financing provision, the local governing body must make a finding or determination that the area included in such plan is a deteriorated area or deteriorating area; and WHEREAS, it is desirable and in the best public interest that the Agency prepare an urban renewal plan for the area identified as the Union District Area in the Report located in the city of Meridian, county of Ada, state of Idaho. NOW, THEREFORE,BE IT RESOLVED BY THE MAYOR AND COUNCIL OF THE CITY OF MERIDIAN, IDAHO,AS FOLLOWS: Section 1. That the City Council acknowledges acceptance and receipt of the Report. Section 2. The City Council finds and declares that the Union District Area identified in the Report, which area may be subject to de-annexation, is a deteriorated or deteriorating area, as defined in Title 50, Chapter 20 and 29, Idaho Code, as amended, and qualifies as an urban renewal project and justification exists for designating the area as appropriate for an urban renewal project. Section 3. Having made such designation, the City Council hereby directs the Agency to commence preparation of a plan amendment to the Downtown District Plan to deannex the Union District Area from the Downtown District Plan Project Area for consideration by the Agency Board and, if acceptable, final consideration by the City Council in compliance with Title 50, Chapters 20 and 29, Idaho Code, as amended. Section 4. Having made such designation, the City Council hereby directs the Agency to commence preparation of an urban renewal plan for the Union District Area for consideration by the Agency Board and, if acceptable, final consideration by the City Council in compliance with Title 50, Chapters 20 and 29, Idaho Code, as amended. RESOLUTION ACCEPTING ELIGIBILITY FOR THE UNION DISTRICT AREA AS AN URBAN RENEWAL AREA-PAGE 3 OF 4 Section 5. That this Resolution shall be in full force and effect immediately upon its adoption and approval. ADOPTED by the City Council of the City of Meridian, Idaho, this loth day of March, 2020. APPROVED by the Mayor of the City of Meridian, Idaho, this loth day of March, 2020 APPROVED: Mayor Robert E. Simison ATTEST: By: Chris Johnson, City Clerk RESOLUTION ACCEPTING ELIGIBILITY FOR THE UNION DISTRICT AREA AS AN URBAN RENEWAL AREA-PAGE 4 OF 4 EXHIBIT A ELIGIBILITY REPORT Union District Urban Renewal District Eligibility Report Prepared for Galena Opportunity Inc. Meridian Development Corporation City of Meridian February 2020 Kushlan I Associates SMR Development, LLC Boise, Idaho I I P a g e EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT Introduction: Kushlan I Associates and SMR Development, LLC were retained by the Galena Opportunity Inc. to assist them in their discussions with the Urban Renewal Agency of the City of Meridian, Idaho, also known as Meridian Development Corporation(the"Agency' or"MDC") and the City of Meridian (the "City") with regard to establishing a new urban renewal district in the City. The Mayor,with the confirmation of the City Council,has appointed nine members to the Agency Board to guide the development of urban renewal plans and oversee their implementation.The current membership of the Agency Board is as follows: Chair: David Winder Vice Chair Nathan Mueller Secretary Steve Vlassek Commissioners Dan Basalone Treg Bernt Diane Bevan Tammy de Weerd Kit Fitzgerald Rob McCarvel Urban Renewal Administrator: Ashley Squyres Idaho Code §50-20o6 states: "URBAN RENEWAL AGENCY. (a)There is hereby created in each municipality an independent public body corporate and politic to be known as the"urban renewal agency"that was created by resolution as provided in section 50-2005,Idaho Code,before July 1,2011,for the municipality.."to carry out the powers enumerated in the statutes. The Meridian City Council adopted Resolution 01-367 on July 24,20o1 bringing forth those powers within the City of Meridian. The MDC currently oversees the implementation of two urban renewal districts. The Meridian Revitalization Plan is the original district, which focuses on the revitalization of the downtown (the"Downtown District"). It was established by the City Council's adoption of Ordinance No. 02-987 on December 3, 2002. The Downtown District is set to expire in 2026. The Urban Renewal Plan forthe Ten Mile Road-A Urban Renewal Project(the"Ten Mile District")was created by the Meridian City Council on June 21,2016 through the adoption of Ordinance No. 16-1695. It is scheduled to expire on December 31, 2o36. 2 1 P a g e EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT ---- ------ 9 1­9 ------------- --------- ------- ------------ L ------- ------------- [h-.b-I- Background: The development of the community of Meridian started in the i88os and was originally located on a farm owned by the Onweiler family.A school was opened in 1885.The U.S.Postal Service established a mail drop along the Oregon Short Line Railroad and the site was named Hunter after its superintendent. Community activity grew around this mail stop focused on the railroad.In 1893 an Odd Fellows lodge was organized and called itself Meridian,acknowledging that it was located on the Boise Meridian the primary North-South survey benchmark for Idaho,and 1893 is generally regarded as the year of the City's founding. That name grew in primary use as the name of the settlement and the Village of Meridian was incorporated in 19o3 with a population of approximately 200. Meridian's traditional economy focused on the support of the surrounding agricultural activities. A maj or creamery was established in the community in 1897 to support the nearby dairies. Fruit orchards were located throughout the area. 31Page EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT Meridian was a significant stop on the Interurban electric railway from 19o8 to 1928. This service provided convenient access for passengers and freight in both easterly and westerly directions. Throughout most of the 20th century, Meridian remained a relatively quiet community focused on its agricultural roots.US Census Bureau data reflects a 1910 population of 61g people growing to 2,616 by 196o. However,starting in 1970 the pace of growth in Southwest Idaho quickened. Meridian's growth initially reflected, and then exceeded the regional growth rates by significant margins. Over the past twenty-five years the rate of growth has been startling by any reasonable standard. The following table reflects that population growth over the City's history. 1903(Incorporation Estimate) 200 1910 619 1920 1,013 1930 1,004 1940 1,465 1950 2,081 196o 2,616 1970 6,658 1990 9,596 2000 34,919 2010 75,092 2019 (Estimate) 1o61804 Cities across the nation actively participate in the economic vitality of their communities through investment in infrastructure. Water and sewer facilities as well as transportation and other systems are all integral elements of an economically viable community. With the significant growth rate and corresponding extension of infrastructure Meridian has a significant amount of capital maintenance and capital improvements looming on the near horizon. Title 50, Chapters 20 and 29, the Urban Renewal Law of 1965 and the Local Economic Development Act contain some of the few tools that are available to cities to help fund public improvements. New sources of State support are not likely to become available in the foreseeable future,thus the Agency's interest in exploring the potential for establishing their third urban renewal district is appropriate. Coupling that State support with the private sector investment potential created by the Opportunity Zone program created under the 2017 Tax Cuts and Jobs Act Tax Reform and further implemented by the IRS under Internal Revenue Code §1400Z-1 and §1400Z-2 could catalyze significant future revitalization. 41Page EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT Demographics: According to the US Census Bureau,the estimated 2019 population of the City is io6,804 which is a 38.8%increase since 2010.This growth rate is more than three times of that experienced statewide which was 11.9%during that period. Meridian has been acknowledged as one of the fastest growing cities in the United States. At 28.5%, the City's percentage of people under 18 years of age exceeds the statewide percentage of 25.5% by 3.0%. The percentage of population under 5 years of age exceeds the statewide figure by 0.3% (6.9%vs. 6.6%).The percentage of the City's population over 65 years of age (12.1%) is less than the statewide percentage (15.9%) by 3.8%. These statistics reflect a population base that is considerably younger than that found statewide. Housing units are 76.2% owner-occupied as opposed to the statewide statistic of 69.2%.Median value of owner-occupied housing units is$221,300 as compared to $176,80o statewide. Monthly owner costs with mortgage is$1,381 as compared to the statewide figure of$1,195.Median gross rent in the City of Meridian is reported as$1,016 as compared to$792 statewide. When income statistics are compared to statewide numbers, we see that the population of the City exceeds the rest of Idaho in these categories as well. The median household income in the City is $64,375, approximately 26% above the statewide figure of$50,985.Per capita monthly income for the City's population is $29,857 as compared to the statewide number of$25,471. The percentage of the City's population below poverty level is 9.8%as compared to the statewide number of 11.8%. These statistics suggest that the City's population is in an enviable position as compared to many Idaho communities. However,the capital and service delivery demands presented by the startling level of growth,when considered in the context of the fiscal limitations on Idaho local government suggest that utilizing existing investment mechanisms such as found in Title 50,Chapters 20 and 29 is a prudent exercise of local legislative authority. Statistics are derived from the latest United States Census Bureau Report. Steps in Consideration of an Urban Renewal District: The first step in consideration of establishing an urban renewal district in Idaho is to define a potential area for analysis as to whether conditions exist within it to qualify for redevelopment activities under the statute. We have called this the "Study Area." The next step in the process is to review the conditions within the Study Area to determine whether the area is eligible for creating a district. The State Law governing urban renewal sets out the following criteria,at least one of which must be found,for an area to be considered eligible for urban renewal activities: 5 1 P a g e EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT 1. The Presence of a Substantial Number of Deteriorated or Deteriorating Structures and Deterioration of Site 150-2018(9) and 50-2903(8)(b)] 2. Age or Obsolescence 150-2018(8)and 50-2903(8)(a)] 3. Predominance of Defective or Inadequate Street Layout 150-2018(9) and 50-2903(8)(b)] 4. Faulty Lot Layout in Relation to Size, Adequacy, Accessibility, or Usefulness 150-2018(9)and 50-2903(8)(b)] 5. Insanitary or Unsafe Conditions 150-2018(9)and 50-2903(8)(b)] 6. Diversity of Ownership 150-2018(9)and 50-2903(8)(b)] 7. Tax or Special Assessment Delinquency 150-2018(9) and 50- 2903(8)(b)] 8. Defective or Unusual Conditions of Title 150-2o18(9) and 50- 2903(8)(b)] 9. Results in Economic Underdevelopment of the Area[50-2903(8)(b)] 10. Substantially Impairs or Arrests the Sound Growth of a Municipality 150-2018(9)and 50-2903(8)(b)] If the Eligibility Report finds that one or more of the conditions noted above exists within the Study Area,then the Agency may accept the findings and forward the Eligibility Report to the City Council for their consideration. If the City Council concurs with the determination of the Agency, they may direct that an Urban Renewal Plan be developed for the area that addresses the issues raised in the Eligibility Report. The Agency then acts to prepare the Urban Renewal Plan for the new District and determines whether to also recommend the establishment of a Revenue Allocation Area to fund improvements called for in the Plan. Once the Plan for the District and Revenue Allocation Area are completed,the Agency Board forwards it to the City Council for their consideration. The City Council must refer the Urban Renewal Plan to the Planning and Zoning Commission to determine whether the Plan, as presented, is consistent with the City's Comprehensive Plan and make a corresponding finding.At the same time, other taxing entities levying property taxes within the boundaries of the proposed Urban Renewal District are provided a thirty-day opportunity to comment on the Plan to the City Council. While the taxing entities are invited to comment on the 6 1 P a g e EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT Plan,their concurrence is not required for the City Council to proceed with formal consideration. Once the Planning and Zoning Commission makes their finding of conformity and the thirty-day comment period has passed,the City Council is permitted to hold a public hearing and formally consider the adoption of the Plan creating the new Urban Renewal District and Revenue Allocation Area. The City Council must also find that the taxable value of the district to be created plus the Base Assessed Value of any existing Urban Renewal/Revenue Allocation Area does not exceed the statutory maximum of lo% of the citywide assessed valuation. If the City Council,in their discretion chooses to proceed,they will officially adopt the Urban Renewal Plan and Revenue Allocation Area and provide official notification of that action to the County Assessor and Idaho State Tax Commission. The Agency then proceeds to implement the Plan. Description of the Union District Study Area: The Study Area subject to the current review(Union District) is located primarily in the central part of the City, on the edge of the traditional downtown area and consists of 15 parcels located on 1.512 acres. Eleven(11)of those parcels are under the ownership of public entities and thus are statutorily exempt from property taxes. Four(4) of those parcels represent condominium units located within the Second and Broadway Condominium project and are occupied by the Community Planning Association of Southwest Idaho(COMPASS)and Valley Regional Transit. One of the parcels is the common-area land on which the condominium units are constructed and the 0.54 acre parcel to the east serves as surface parking in support of the condominium project and other adjacent uses. Older commercial buildings on the northerly portion of the Study Area have been converted to public use as adjunct library space and as an interim community center. A small municipal park is located at the extreme northeast corner of the Study Area. Currently,the Study Area is located within the Downtown District; however, the Agency is taking steps to amend the Downtown District Plan to de-annex the Study Area parcels. The southerly portion of the Study Area is occupied by older structures located on large parcels and used for the storage and sale of building materials. The extreme southern boundary of the Study Area is occupied by the Right-of-Way of the Union Pacific Railroad. The Study Area encompasses fifteen (15) individual tax parcels. Only the area in the southern portion of the Study Area is taxable. The railroad right-of-way is regarded as"Utility Operating Property"under State Law and as such is assessed separately by the Idaho State Tax Commission. 7 1 P a g e EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT Table 1 reflects the data for each of the 15 tax parcels represented in the Study Area: Table 1 Tax Parcel Owner Acres Land Value Improvem Total Value %Impr. ent value Value/ Land Value Publicly Owned Parcels R5672000856 City of Meridian 0.33 $o $0 $0 N/A R5672000870 Meridian Free Library 0.05 $o $0 $0 N/A District R7596000080 City of Meridian o.16 $o $o $0 N/A R7596000075 City of Meridian 0.08 $o $0 $0 N/A R7596000065 City of Meridian o.16 $o $0 $0 N/A R7596000092 Meridian Development 0.54 $o $o $0 N/A Corporation R7794650100 Second&Broadway N/A $o $o $o N/A Condominium Owners Association R7794650200 Second&Broadway N/A $o $o $0 N/A Condominium Owners Association R7794650300 Second&Broadway N/A $o $0 $0 N/A Condominium Owners Association R7794650400 Second&Broadway N/A $o $0 $0 N/A Condominium Owners Association R7794650500 Second&Broadway N/A $o $o $0 N/A Condominium Owners Association Subtotal Publicly Owned $o $0 $0 Privately Owned Parcels S1107325600 Oregon Short Line R R 44 $1,322,800 $168,800 $1,491,600 13% Co S1107325700 Oregon Short Line R R o.96 $43o,600 $105,100 $535,700 24% Co R7596000545 Oregon Short Line R R o.832 $680,400 $444,800 $1,125,200 65% Co R7596000545-A Oregon Short Line R R R-O-W $o $o $0 Co Subtotal Privately Owned 6.192 $i,8i6,goo $346,480 $2,163,380 Grand Total 12 $1 816 oo $346,48o $2,i63,38o The Study Area is+/-15.86 acres,of which+/-7.512 acres include privately and publicly owned parcels. The differential includes public and railroad rights-of- way. Please see the map below for a graphic representation of the Union District Study Area. 8 1 P a g e EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT �ruoN DISTRICT CITY OF MERIDIAN,ADA CDf7MY,IpAhV U � uu � E FfNE AVE z i z v y z s 4 z ❑ o 2 y y N A b]- E IDAHO AVE � F F— r 3�.05 L _ E 9ROADWAYAVE - - :!S.a5.1CRC5 h S1S1S1f MC%..PAC0dGRA]iftnD L / alp � 1,�74 E FRANKLIH RD OF .t " I k89^3}M3'W 17 !d BP V' FggAGy nis 2030a WA5HM16-NY AVE. p1GM UNION D STRICT DWF r,➢ &YJ7 12cu1 aea ANNEXATION EXHIBIT MI.TRUAx p)/(200V)3q"0I04 MEND—fo_ F:(2081398-SJ05 12001E SEC, 7,T3N. RIE,R.M. 2C"l s.641 v�r ADA COUNTY, IDAHtl - VJJlYJ5.4W70Ui'FtV^.[aM saoso �� rvLLG Analysis of the Study Area: The Study Area consists of 15 tax parcels representing 7.512 acres(not including rights-of-way)located in the central part of the City. It is located generally east of Main Street and south of Idaho Avenue. It is a mixture of commercially and industrially zoned properties. The portion of the Study Area fronting the western edge of NE 3rd Street, south of Broadway Avenue currently is designated as City of Meridian I-L Light Industrial. The remaining properties located both north and south of Broadway Avenue are designated as City of Meridian O-T Old Town. The City of Meridian Code under Title ii details the purpose of the O-T zoning designation as follows: g1Page EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT "Old Town District(O-T): The purpose of the O-T District is to accommodate and encourage further intensification of the historical City center in accord with the Meridian Comprehensive Plan. The intent of the 0-T District is to delineate a centralized activity center and to encourage its renewal,revitalization and growth as the public,quasi-public,cultural,financial and recreational center of the City.Public and quasi-public uses integrated with general business, and medium high to high density residential is encouraged to provide the appropriate mix and intensity of activities necessary to establish a truly urban City center." None of the parcels included within the Study Area have been used for agricultural or forestry purposes during the past three years,negating the requirement to gain specific consent of any property owner of such a property for inclusion in an urban renewal district. While public entities have made significant investment in the portions of the northern part of the Study Area with park and parking improvements and a building to house regionally focused governmental organizations,a detailed review of the Study Area reflects a pattern of underinvestment and disinvestment over time. The American Institute of Appraisers suggests that an economically viable, developed property would reflect a ratio of 30%land to 70%improvements.After initial improvements are made, without continuing reinvestment, the improvement ratio declines;and as it approaches par,a condition of disinvestment or deterioration is assumed. Table 1 above shows that all the privately held properties located within the Study Area reflect this condition.The property located at 632 North Main Street reflects improvement value at only 13%of land assessed value and for the property located at 415 East Broadway, the improvement value is only 65% of land value. The structures are old and occupy only a small portion of the applicable sites. A recent site survey has indicated that the light industrial uses formerly conducted on these parcels have terminated and the properties now stand vacant, except for the unused buildings and surface parking. This condition stands in stark contrast to the vision expressed for the area in various City planning documents. Streets: The north half of Broadway Avenue as well as Idaho Avenue, end Street and the westerly portion of 3rd street north of Broadway have been improved to current City of Meridian standards with curbs,gutters,street lighting and storm drainage facilities.A portion of the south side of Broadway remains unimproved as does the east side of 3rd Street through the Study Area. The west side of 3rd Street south of Broadway has curb and gutters in place with an adjacent narrow sidewalk which is interrupted by several unused curb cuts. The sidewalk appears unmaintained and is of insufficient width to accommodate the high-density activity envisioned in City planning documents. Water: As identified in the recent ALTA Survey conducted by Sawtooth Land Surveyors and dated 12/2019, water lines exist in Main Street, 3rd Street and Broadway Avenue as well as on the south side of the Railroad property. However, the latter water line does not extend the full length of the property and therefore is ioIPage EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT not looped into the Main Street line. The water main in 3rd Street will likely have to be increased from a 6"to a 12"main. This represents a serious deficiency with respect to fire flows required for the proposed project. Sewer Collection: Although a proposed project has not been reviewed by the City Public Works Department, existing sewer lines may be adequate to serve future development. Pedestrian facilities: Significant investment has been made in the pedestrian facilities in the northerly block of the Study Area. However, the system is incomplete. No facilities exist of the east side Of 3rd Street, nor the south side of Broadway Avenue. The introduction of the large number of residents anticipated will require the completion of the pedestrian network. Storm Drainage: Although a proposed project has not been reviewed by the City Public Works Department, existing storm drainage may be adequate to serve future development. Rail Crossing: The extreme southerly portion of the Study Area consists of the right-of-way for the Union Pacific Railway. The tracks located within the right-of- way accommodate active freight rail service and are used on a daily basis. These tracks serve as the primary transit corridor for freight movements from Boise and Meridian to the Union Pacific Mainline connection located in Nampa. The 3ra Street crossing of the rail line is protected only by stop signs. Given the high- density development envisioned in the area and the resultant increase in vehicular and pedestrian traffic,the limited crossing protection currently affordedwill prove inadequate. Irrigation Facilities: The Hunter Lateral is a historic irrigation facility that enters the study area from the east crossing 3rd Street near the intersection with Broadway Avenue and fronts the easterly parcels in the Study Area facing Broadway on the south side of the street. The lateral had existed within the Ada County Highway District Right-of-way but recent actions by the developer of the proposed project adjacent to the area have resulted in the acquisition of that portion of the right-of- way in which the lateral exists. The Nampa — Meridian Irrigation District, who owns and maintains the lateral, has retained an easement across the property to allow its continued operation and maintenance. The existence of the easement will limit the use of that area for development. The lateral currently exists in an open ditch configuration along the Broadway frontage and along most of the east side of the 3ra Street frontage. As the lateral turns north across Broadway it enters an underground configuration and continues in this piped arrangement throughout downtown. The open ditch configuration can be considered adequate for the current light industrial uses but as the area transitions to more intense uses the lateral will need to be enclosed consistent with its treatment throughout the rest of downtown Meridian. ii I Page EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT Required Findings Regarding Eligibility for the Study Area: In order to make a finding that the Study Area is, in fact, eligible for being considered for the establishment of an urban renewal district,one must compare the conditions found in the area with the statutory criteria noted above. For the convenience of the reader those criteria are repeated here: 1. The Presence of a Substantial Number of Deteriorated or Deteriorating Structures and Deterioration of Site 150-2018(9);and 50-2903(8)(b)] 2. Age or Obsolescence 150-2018(8)and 50-2903(8)(a)] 3. Predominance of Defective or Inadequate Street Layout 150-2oi8(9) and 50-2903(8)(b)] 4. Faulty Lot Layout in Relation to Size, Adequacy, Accessibility or Usefulness 150-2018(9)and 50-2903(8)(b)] 5. Insanitary or Unsafe Conditions 150-2oi8(9)and 50-2903(8)(b)] 6. Diversity of Ownership 150-2018(9);50-2903(8)(b)] 7. Tax or Special Assessment Delinquency 150-2018(9) and 50- 2903(8)(b)] 8. Defective or Unusual Conditions of Title 150-2oi8(9) and 50- 2903(8)(b)] 9. Results in Economic Underdevelopment of the Area[50-2903(8)(b)] 10. Substantially Impairs or Arrests the Sound Growth of a Municipality 150-2018(g)and 50-2903(8)(b)] Criterion #1: The Presence of a Substantial Number of Deteriorated or Deteriorating Structures; and Deterioration of Site: As noted above all the privately owned properties in the Study Area reflect improvement values less than land values. This suggests that deteriorated or deteriorating structures exist or properties are vacant. A site visit confirms the data — there are a substantial number of old, dilapidated vacant structures in the Study Area with the corresponding properties containing crumbling cement pads and other decaying improvements.Therefore,Criterion#1 is met. Criterion#2:Age or Obsolescence:Substantial investment has been made in the northerly block of the Study Area,but the existing structure owned by the city is old and does not meet the current needs of the community which has experienced the aforementioned expansive growth. The majority of the Study Area south of Broadway is either vacant or lightly used industrial property.The buildings that do 12 1 Page EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT exist on the properties south of Broadway are old,in poor outdated condition and not currently utilized.Given the designation in the City's Comprehensive Plan and zoning documents,the current use as an essentially abandoned light industrial use is obsolete.Therefore Criterion#2 is met. Criterion #3: Predominance of Defective or Inadequate Street Layout. Adequate right-of way exists to accommodate the new investment consistent with the City's Comprehensive Plan. However, only part of the streets have been improved to full urban standards as required under City of Meridian development regulations. Full improvement to 3rd Street between Broadway Avenue and the Union Pacific right-of-way will be required to accommodate the high-density development. The pedestrian system will need to be completed and full crossing protection will be needed. Therefore,Criterion#3 is met. Criterion#4:Faulty Lot Layout in Relation to Size,Adequacy,Accessibility or Usefulness.The lots located in the northern block of the Study Area are regularly configured and consistent with the rest of the parcels in downtown Meridian. All of the parcels in the northern block are owned by public entities and dedicated to public activities. The four(4) privately owned parcels within the south block of the Study Area are large, and mostly vacant. One parcel is impacted by a 4o-foot-wide easement benefitting the Nampa — Meridian Irrigation District that is located on the southwest quadrant of the 3ra and Broadway intersection. This easement severely limits the flexibility of development options in this location. Currently the eastern-most parcels in the development vision are designated as part of the parcels east of 3ra Street by the Ada County Assessor. Additionally,part of the development vision is located on a part of the Union Pacific Railroad right- of-way. These property anomalies will need to be rectified before the vision expressed for the properties can be realized. Therefore,Criterion#4 is met. Criterion #5: Insanitary or Unsafe Conditions. The substandard condition of major portions of the streets, the lack of adequate storm drainage facilities, the incomplete street lighting system and the lack of adequate pedestrian facilities, inadequate fire flows point to current unsafe conditions that will be exacerbated as development occurs consistent with the City's Comprehensive Plan. Therefore, Criterion#5 is met. Criterion#6:Diversity of Ownership.The 15 parcels examined in this study are under the ownership or control of 4 entities; three public and one private. Preliminary discussions with respect to the development proposal currently under consideration suggests mutual support among the various property owners. Therefore,Criterion#6 is not met. 131Page EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT Criterion #7: Tax or Special Assessment Delinquency: The records of the Ada County Assessor do not reflect any tax or special assessment delinquency. Therefore,Criterion#7 is not met. Criterion#8:Defective or Unusual Conditions of Title:The property,currently owned by the Oregon Short Line Railroad,includes certain reversionary clauses in the deeds leading to potential conflicting claims of ownership. The known entities or individuals who are heirs of the last living deeded owners of the fee interest in the property,the Smith and Ellis families,have agreed to convey all of their interest after significant efforts ("Known Underlying Fee Owners"). These Known Underling Fee Owners or KFOs were determined by extensive genealogical and other research. However,because of the unique and complex nature of the chain of title, doubt and uncertainty still exists as to even the state of title even of the KFOs, thereby necessitating a quiet title/declaratory judgment action. Further there is an operating lease and easement that Oregon Short Line Railroad has encumbering the entire property. These conditions are specifically what has prevented the redevelopment of the property for more than 12 years of active attempts to acquire. This condition provides sufficient information to make a determination for most of the property in the Study Area and therefore Criterion 8 has been met. Criterion #9: Results in Economic Underdevelopment of the Area: The northerly block of the Study Area has seen investment in recent years in support of various public uses. However, the majority of the land within the Study Area remains underutilized and, in some cases, we see deteriorating and/or obsolete uses.Therefore,Criterion#9 is met. Criterion #io: Substantially Impairs or Arrests the Sound Growth of a Municipality. The Study Area exists within the corporate limits of the City of Meridian and abuts dense urban development on the north, and west sides. Despite considerable interest in redeveloping this underutilized area on the edge of the historic downtown area, no progress has been made during the ten-year effort to transform the area consistent with the vision expressed in the City's planning documents. The ownership and title issues and lack of adequate infrastructure within most of the Study Area inhibits the development envisioned in the City's Comprehensive Plan.Therefore,Criterion#io is met. Findings: Union District Study Area: Conditions exist within the Study Area to allow the Board of Commissioners of the Agency and the City Council to determine that the area is eligible for urban renewal activities as prescribed in State Law. 141Page EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT Criteria Met Not Met 1 The Presence of a Substantial Number of Deteriorated X or Deteriorating Structures;and Deterioration of Site 2 Age or Obsolescence X 3 Predominance of Defective or Inadequate Street X Layout 4 Faulty Lot Layout in Relation to Size,Adequacy, X Accessibility or Usefulness 5 Insanitary or Unsafe Conditions X 6 Diversity of Ownership X 7 Tax or Special Assessment Delinquency X 8 Defective or unusual condition of title X 9 Results in Economic Underdevelopment of the Area X 10 Substantially Impairs or Arrests the Sound Growth of X a Municipality Analysis: Open Land Conditions: The parcels located within the Study Area have been located within the City limits of Meridian for decades and have been dedicated to various urban uses. Therefore,the provisions of Idaho Code Section 50-2903(8)(c)and 50-20o8(d)do not apply. Conclusion: Based upon our review of the data and the conditions that exist within the Study Area as noted above, one or more of the necessary criteria have been met and therefore the Meridian City Council may determine that the Union District Urban Renewal District, as proposed, is eligible for the establishment of an urban renewal district. Other Relevant Issues: Agricultural Landowners Concurrence: None of the area within the Study Area maintains an agricultural land property tax exemption as authorized under state law. The statutory provisions concerning the creation of an urban renewal district prohibit inclusion of any land used for agricultural purposes without the express written consent of the property owner. Given that no such exemptions exist nor have existed during the previous three years,consent is not required. 10% Analysis: In addition to the findings reported above, we also sought to verify that the assessed value of the proposed Study Area is within the statutory limits.As noted above, State Law limits the percentage of assessed value that can be included in urban renewal / revenue allocation districts to io% of the total valuation of the City.According to Ada County Assessor records,the most recent certified value for the City is $9,465,76o,oii.The taxable value of the Study Area is $2,162,38o representing 0.023% of the total City assessed value. The Base 15 1 Page EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT Assessed Value of the Downtown District is $131,252,90o and the Ten Mile Road District is $12,582,900. The Table below shows the result compared to the statutory requirement. tatut0ry io%Limitation Analysis Area Base Assessed Percentage Value Total City $ 465 760 oil 100% • Downtown District URD $131,252,900 1.39% • Ten Mile Road URD $12,582,900 0.133% • Proposed Union District URD $2,163,380 0.023% Total UR Base Assessed Value Percentage $145 8 180 1.54% We also explored the effect of creating this district on the capacity of the Urban Renewal Agency to consider future districts should they choose to do so.The table below shows that even if a new district similar to Union District were to be established, approximately 8.46% of the citywide assessed value would remain uncommitted. Remaining Urban Renewal Capacity • Maximum lo%Limitation $946,576,001 10% • Downtown District URD $131,252,900 1.387% • Ten Mile Road URD $12,582,900 0.133% • Proposed Union District URD $2,162,380 0.023% • Total AV in Revenue Allocation Areas $145,998,18o 1.54% • Available AV under limitation $800,576,00i 8.46% 4838-5478-2132,v.3 161Page EXHIBIT A-ELIGIBILITY REPORT—UNION DISTRICT URBAN RENEWAL DISTRICT EXHIBIT B MDC AGENCY RESOLUTION I MERIDIAN DEVELOPMENT CORPORATION j THE URBAN RENEWAL AGENCY OF THE CITY OF MERIDIAN RESOLUTION NO.20-003 BY THE BOARD OF COMMISSIONERS OF THE URBAN RENEWAL AGENCY OF MERIDIAN, IDAHO,A/K/A THE MERIDIAN DEVELOPMENT CORPORATION: i A RESOLUTION OF THE BOARD OF COMMISSIONERS OF THE URBAN RENEWAL AGENCY OF MERIDIAN, IDAHO,ALSO KNOWN AS THE MERIDIAN DEVELOPMENT CORPORATION,ACCEPTING THAT CERTAIN REPORT ON ELIGIBILITY FOR CERTAIN PROPERTY REFERRED TO AS THE UNION DISTRICT j AREA AS AN URBAN RENEWAL AREA AND REVENUE ALLOCATION AREA AND JUSTIFICATION FOR DESIGNATING THE AREA AS APPROPRIATE FOR AN URBAN RENEWAL PROJECT;AUTHORIZING AND DIRECTING THE CHAIRMAN,VICE-CHAIRMAN OR ADMINISTRATOR TO TRANSMIT THE REPORT AND THIS RESOLUTION TO THE CITY COUNCIL OF THE CITY OF MERIDIAN REQUESTING ITS CONSIDERATION FOR DESIGNATION OF AN URBAN RENEWAL AREA AND SEEKING FURTHER DIRECTION FROM THE COUNCIL; AND PROVIDING AN EFFECTIVE DATE. THIS RESOLUTION, made on the date hereinafter set forth by the Urban Renewal Agency of Meridian, Idaho,also known as the Meridian Development Corporation,an independent public body, corporate and politic,authorized under the authority of the Idaho Urban Renewal Law of 1965,Chapter 20,Title 50, Idaho Code,as amended (the"Law"), a duly created and functioning urban renewal agency for Meridian, Idaho, hereinafter referred to as the"MDC." WHEREAS,on July 24, 2001,the City Council (the"City Council")of the City of Meridian, Idaho(the"City"), adopted Resolution No.01-367 establishing MDC; WHEREAS,on October 8,2002,the City Council, after notice duly published, conducted a public hearing on the Meridian Revitalization Plan Urban Renewal Project, which is also referred to as the Downtown District(the"Downtown District Plan"); WHEREAS,following said public hearing, the City Council adopted its Ordinance No. 02-987 on December 3, 2002, approving the Downtown District Plan and making certain findings; RESOLUTION NO.20-003- 1 EXHIBIT B—MDC RESOLUTION 20-003 WHEREAS, on June 14, 2016,the City Council, after notice duly published, j conducted a public hearing on The Ten Mile Road Urban Renewal Plan (the"Ten Mile Plan"). The public hearing was continued to June 21, 2016, for further testimony; WHEREAS,following said public hearing,the City Council adopted its Ordinance No. 16-1695 on June 21, 2016, approving the Ten Mile Plan and making certain findings; WHEREAS, based on inquiries and information presented by certain interested parties and property owners, MDC commenced certain discussions concerning examination of an area as appropriate for an urban renewal project; WHEREAS, in 2019, Kushlan I Associates and SMR Development, LLC commenced an eligibility study and preparation of an eligibility report for an area about 16 acres in size and currently located within the boundaries of the Downtown District Plan,which area may be subject to de-annexation. The area is generally east of Main Street, south of Idaho Avenue, west of E. 3rd Street, and north of the Union Pacific Railroad right-of-way. The eligibility study area is commonly referred to as the Union District area; WHEREAS, MDC has obtained an eligibility report(the"Report"),which examined the Union District Area for the purpose of determining whether such area was a deteriorating area and/or a deteriorated area as defined by Idaho Code Sections 50- 2018(9)and 50-2903(8); WHEREAS, the Report, dated February 2020, has been submitted to MDC, a copy of which is attached hereto as Exhibit A; WHEREAS, pursuant to Idaho Code Section 50-2008, an urban renewal project may not be planned or initiated unless the local governing body has, by resolution, determined such area to be a deteriorated area or deteriorating area, or combination thereof, and designated such area as appropriate for an urban renewal project; WHEREAS, Idaho Code Section 50-2906,also requires that in order to adopt an urban renewal plan containing a revenue allocation financing provision,the local governing body must make a finding or determination that the area included in such plan is a deteriorated area or deteriorating area; WHEREAS,the MDC Board finds it in the best public interest to accept the Report. NOW,THEREFORE, BE IT RESOLVED BY THE MEMBERS OF THE BOARD OF COMMISSIONERS OF THE URBAN RENEWAL AGENCY OF MERIDIAN, IDAHO, AS FOLLOWS: Section 1. That the above statements are true and correct. RESOLUTION NO.20-003-2 EXHIBIT B—MDC RESOLUTION 20-003 Section 2. That the Board acknowledges acceptance and receipt of the Report. Section 3. That there are one or more areas within the City that are a deteriorating area or a deteriorated area as defined by Idaho Code Sections 50-2018(9) and 50-2903(8). Section 4. That one such area is an area approximately 16 acres in size and currently located within the boundaries of the Downtown District Plan,which area may be subject to de-annexation, and more commonly known as the Union District area. The area is generally east of Main Street, south of Idaho Avenue,west of E. 3rd Street, and north of the Union Pacific Railroad right-of-way. Section 5. That the rehabilitation, conservation, and redevelopment, or a combination thereof,of such area is necessary in the interest of the public health, safety, and welfare of the residents of the City. Section 6. That the Chairman or Vice-Chairman of the Board of Commissioners,or the Administrator are hereby authorized to transmit the Report to the Meridian City Council requesting that the City Council: a. Determine whether the Union District area identified in the Report qualifies as an urban renewal project and there is justification for designating the area, as appropriate,for an urban renewal project; b. If such designation is made,whether MDC should proceed with the preparation of an urban renewal plan for the area, which plan may include a revenue allocation provision as allowed by law; C. If such designation is made whether MDC should proceed with the preparation of a plan amendment to the Downtown District Plan to deannex the Union District Area. Section 7. That this Resolution shall be in full force and effect immediately upon its adoption and approval. RESOLUTION NO.20-003-3 EXHIBIT B—MDC RESOLUTION 20-003 I PASSED AND ADOPTED by the Urban Renewal Agency of the City of Meridian, I Idaho, also known as the Meridian Development Corporation, on February 26, 2020. Signed by the Chairman of the Board of Commissioners and attested by the Secretary to the Board of Commissioners, on February 26, 2020. APPROVED: By C air of the Board ATTEST: Secreta ! i I I i i I i i i i RESOLUTION NO.20-003-4 EXHIBIT B—MDC RESOLUTION 20-003