HomeMy WebLinkAboutRS2- Economic Development ECONOMIC DEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO
R 2UEST FOR COMMISSION/COUNCU,ACTION
FROM: BARBARA J.LINDSETH SUBJECT: ECONOMIC DEVELOPMENT
Acting Director INI'T'IATIVE(EDT)-CAROUSEL
MALL REVITALIZATION
DATE: April 15, 1994
Synopsis of Previous Commission/Council/Committee Action(s):
None.
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Recommended Motion(s):
(Mayor and Common Council)
MOTION: RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF SAN
BERNARDINO CALIFORNIA,AUTHORIZING EXECUTION AND SUBMISSION OF AN
ECONOMIC DEVELOPMENT INITIATIVE GRANT APPLICATION(EDI) TO THE
U.S.DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT(HUD)IN THE
AMOUNT OF$1,750,000.00 FOR THE CAROUSEL MALL REVITALIZATION PROJECT.
Administrator BARBARA J.LINDSETH
Acting Director
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Contact Person(s):Barbara J.Lindseth/EmilWong_ Phone: 5081
Project Area(s): Central City (CC) Ward(s): One
Supporting Data Attached: Staff Report Resolution EDI Grant Application on file
FUNDING REQUIREMENTS: Amount:$ Source: _
Budget Authority:
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Commission/Council Notes
BJL:EMW:edi.cdc(adw) COMM.TSS VN MEET INGAGENDA
MEE'T'ING DATE: 04/17/95
Agenda Item No. 91'3
ECONOMIC DEVELOPMENT AGENCY
STAFF REPORT
Economic Development Initiative (EDI)
Carousel Mall Revitalization
BACKGROUND
The Department of Housing and Urban Development (HUD)has announced the availability of 50
million dollars in grants under its Economic Development Initiative (EDI). These EDI funds are
designed to be used in conjunction with the Section 108 Loan Guarantee Program, and applicants
are required to include a request for Section 108 Loan Guarantee commitment in their application
for EDI funds.
HUD indicates that EDI funds mini nize the potential loss of future Community Development
Block Grants by:
1. Strengthening the economic feasibility of Section 108 assisted projects.
2. Directly improving the security of the guaranteed loan.
3. Other activities which are a combination of the above two approaches.
Examples of eligible uses of EDI funds include EDI grants being used as:
1. Funding reserves.
2. Over collateralizing the Section 108 loan.
3. Direct enhancement of the security of the Section 108 loan.
4. Provision of financing to full profit businesses at a below market interest rate.
5. A combination of these approaches that works towards economic development.
HUD requires that all activities related to job training,employment and other contracting
opportunities generated from this funding source benefit individuals with low and very low
incomes.
PROTECT DESCRIPTION
The Carousel Mall is located in the heart of the downtown, immediately across the street from the
Civic Center and adjacent to the Radisson Hotel. The mall is part of the economic heart of the
downtown. It currently employs approximately 1,600 persons,the vast majority of which are low
and very low income workers. The 914,386 square foot mall is anchored by Harris,J.C. Penney,
and Montgomery Wards department stores.
BJL:EMW:edi.cdc(adw) COMMISSION MEETING AGENDA
MEETING DATE: 04/17/95
Agenda Item No.-[" _> °"
Economic Development Agency Staff Report
Economic Development Initiative (EDI)
April 14, 1995 Page -2-
The economic downturn in the 1990 s has begun to seriously erode the strength of the mall and
other elements of the downtown. Currently,the mall has over 100,000 square feet of vacant
space. The mall is in need of a comprehensive strategy for renovation to include interior
iJnprovements as well as exterior rehabilitation. In March of 1995,the City Council adopted the
newly updated San Bernardino Downtown Plan. One of the key strategies identified in this plan is
"retail expansion and redevelopment of Carousel Mall to become a more urban center with
actively retail uses at its perimeter and more direct, attractive entrances into the mall. There is
potential to expand the amount of retail space in the mall by as much as one third almost all of it
facing perimeter downtown streets including a fourth anchor store."
The Carousel Mall is proposing to implement a$13,450,000 revitalization project. The
ownership entity will be willing to invest approximately $7,700,000 in private dollars for the
renovation and expansion. In addition,they are requesting a$5,000,000 Section 108 Loan in
addition to the $1,750,000 EDI grant; $750,000 of which will be used for the direct
iJnprovements to the Agency-owned common areas of the mall,with the balance of$1,000,000 to
be used to collateralize the Section 108 Loan thus bringing an added measure of security to the
Cone nunity Development Block Grant Program(CDBG).
For clarification purposes, it should be noted that submission of an EDI Grant Application in the
amount of$1,750,000 does not commit the City to any specific funding at this stage. However,
should the City be offered a grant award, the City's decision to accept an EDI Grant must be
conditioned upon utilizing it in conjunction with Section 108 financing.
RECOMMENDATION
Based upon the foregoing, staff recommends that the City Council approves the submission of an
EDI application to HUD in the amount of$1,750,000 for a Carousel Mall Revitalization Project.
Also, staff reconunends adoption of the attached resolution.
BARBARA J. LINDSETH, Acting Director
Development Department
BJL:EMW:cdi.cdc(adw) COMMISSION MEETING AGENDA
MEETING DATE: 04/17/95
Agenda Item No. )'' i-