City Council April 20, 2011 Work Session: Agenda Summary

AGENDA SUMMARY:

Item 3: HOTEL STUDY—Mark Skinner of The Highland Group presented the findings of the requested (new) hotel feasibility study; this study included four hotels in and around the city. The two proposed locations for this hotel are Georgia 20 and 316; and downtown.  Skinner outlined strengths and weaknesses of both locations.

He said the colleges and ’s new vascular and heart center will increase the need for hotels in the area. Currently if hotel stays are required for physicians recruiting Gwinnett Medical prefers using hotels in Duluth off Sugarloaf Parkway.

The study indicates that will be converting meeting room space into classrooms. There is no hotel with significant meeting space in Lawrenceville, Skinner said.  

In conducting study, Skinner contacted hotel chains to inquire about their willingness to build a hotel. An issue that was identified in the study is that with one or two exceptions, major hotel chains are not building full scale hotels in the U.S. 

Skinner provided a Summary of Lawrenceville Hotel Market that found average hotel occupancy was 46%-54% for the last four years. This Skinner said was not a compelling story for new development because it is considered to be to low; high 60’s and 70’s are considered to be idle. In previous years hotel occupancy has declined, but there is a 9% increase through January compared to last year. There has been no new hotel development in nine years. The average daily rate for hotels in Lawrenceville is higher than the overall Atlanta average.  

Skinner recommended the Georgia 20 and 316 location due to number of restaurants, the ability to build a hotel with appropriate meeting space and to permit a larger number of hotel rooms with two beds; there is a shortage of two bed hotel rooms, which prohibits family stays.

Of the hotels included in study, the Courtyard by Marriott allows meeting space of up to 3,000 square feet in the hotel.  And if additional square feet are needed above 3,000, Courtyard would approve construction of an adjacent building. Courtyard has expressed interest in seeing the Lawrenceville study.  Skinner said Courtyard is associated with meeting space and is more business oriented.

He also recommended a hotel with 80 rooms, with 50% of the rooms having two beds; 60% occupancy in the first year with a rate of $106; also should have typical amenities found in any comparable hotel.

As for funding Skinner said real estate lending is way down. At current hotel development costs, the hotel would most likely require public funds to make financially feasible. He said this is not unusual. Citing the city of Albany paying for meeting space construction in hotel and in Rome the city is thinking of donating the land used to build hotel. Skinner said public funds could also come in the form of tax abatement, creative financing, and bond financing. Anything that the city could do to lower development and, or operating costs will make the city more attractive.

Councilman Martin said the city is in desperate need of high quality hotel space and meeting space that is privately run; doesn’t want the city to run any portion. He also said TADs might become a key to a development like this.

Mayor Judy Jordan Johnson said that if council decides on further study, the city would contact Skinner.

Item 4: REVISED TADs (Tax Allocation Districts) MAPS and OPPORUNITY ZONES BOUNDARIES---As requested by council, Ken Bleakly of the Bleakly Advisory Group presented these revisions. In a previous meeting Bleakly was instructed to revise the TADs boundaries of the proposed College Corridor to add remaining parcels along Collins Industrial Way. To include parcels on the west side of Collins Hill Road from Highway 316 to Hurricane Shoals. Also requested was extending the TAD west along Hurricane Shoals to Philip Boulevard.

These revisions increased parcels from 271 to 309 and acreage from 452 to 566.  Requested revisions increased the appraised value of the TADs from $100.4 million to $167.8 million. The taxable value of the TADs was increased from $30.9 million to $52.1 million.  Revisions also increased the city’s digest from 2.93% to 4.95%.   

Next steps include finalizing TAD Plans (Highway 120 Corridor and College Corridor) for council’s approval. Submit plans to Gwinnett County, economic development, officials for review and feedback. Hold public hearings for both of the proposed TAD Redevelopment Plans. City Council will then vote to approve and adopt both plans. City then negotiates to obtain concurrence documents from the Gwinnett Board of Commissioners and the Gwinnett School Board. Finally, before December 15, 2011 city must submit approved plans to the Georgia Department of Revenue for certification of the cash value of the TADs.

Bleakly said that state law requires that Opportunity Zones be established in census block groups with 15% poverty or be in block groups adjacent to those areas. Using census data the city must create an urban redevelopment area and a potential enterprise zone inside that boundary. Bleakly created proposed zones using 2000 year census data. Once city approves, the plan will then be submitted to the Department of Community Affairs.

Proposed Opportunity Zones based on boundaries are the north side of Hurricane Shoals, Buford on the east side, Scenic Drive on the southeast side and Gwinnett Drive on the southwest side and Duluth Highway.

Councilman Peter Martin said these Opportunity Zones tax credits are driving relocations of businesses in the county. Bleakly said that new businesses within the area that hires a second employee onward they get $3,500 of state tax credit for a five year period. If established company relocates within these zones they also qualify for state tax credits for existing employees and new hires. 

With anticipation of new census data being released and available in June, council asked that plans move forward; with re-evaluation in June or July.    

Council asked that these Opportunity Zones plans be placed on the May (2nd) Business Meeting agenda.

Item 6: PIKE STREET BRIDGE---Mickey Watts said that in February the city put out a bid for repairs to the Pike Street railroad bridge hanger and gas main replacement.  At the end of that bid, due to discrepancies in the cost range of bids, council requested that project be re-bided.

Watts said the result of the re-bid was as of April 14, that the city had not received any bids. He then asked council for guidance.

Councilwoman Marie Beiser asked if council delaying this project by requesting re-bidding could have discouraged bidders.   Watts said he believed it did. He said contractors probably moved on to jobs that they got before this project and during the interim.

Councilman Tony Powell said he was in favor of re-bidding again. Due to safety concerns with the bridge Watts asked the council for expedience.

Councilwoman Beiser said she was against re-bidding and went on record that she did not want to put anyone traveling on the bridge in jeopardy.

Councilwoman Katie Hart Smith agreed and said the PSC (Public Service Commission) has raised this issue as a red flag and has placed the city on notice to get this done.

Councilman Powell said that while some things about the low bidder are troubling, he agreed with Councilwoman Beiser, that the city should proceed. But to talk about this item clearly and about what the city will do, Powell said a discussion in Executive Session should take place.  

Powell asked that this item and change order request from Steel & Associates be moved to Executive Session for discussions of matters of a legal nature.

Councilwoman Beiser asked that someone from the gas (department) and superintendent of utilities also attend Executive Session.

Item 9: DISCUSSION OF SIGN ORDINANCE---Dennis Billew, Director of Planning and Zoning, sent council via email prior to meeting a listing of five definitions of monument signs. These definitions were from five different cities; he also included a proposed definition for the city. He also sent council a draft of the streets that the city could allow electronic signs.

Billew said that while ordinance captures interior electronic signage, does it capture non-complying signage, and does ordinance provide mechanism to leave signage used by non-profits alone. Billew and City Attorney Lee Thompson, Jr. are in discussions to address these issues.

Billew asked the council for guidance.  Councilman Powell asked that under choice of signs, that Gwinnett’s definition be used and add sentence that reads, “The base shall be at least as wide as the sign and or frame upon it and a minimum of two feet in height.”

Addressing area designation, Powell said he was reluctant to go all over the city with this process. Therefore he deleted most of the proposed areas, but kept from Scenic Highway to city limits to Moon Road. Next allowed areas would be Buford Drive, State Highway 20 from the city limits stopping at railroad tracks; West Pike Street going to 316 and again stopping at railroad tracks. And he said the only other place to allow electronic signage would be on Sugarloaf Parkway.

Powell also asked that permitting these signs in residential areas be eliminated from draft. He also recommended changing all of the zoning classifications to BG. He asked that the city define appropriate brightness, and that the city assumes responsibility to test these signs for proper light levels to enforce ordinance.

Powell said he would like the city to have total discretion over signs posted on city property within the eight blocks in downtown. Also proposed that canopy signage falls under this discretion as well. He suggested getting permits through the Planning Department.

In addressing A-frame signs usage in the eight blocks of downtown, Powell asked that a provision be incorporated into the ordinance that allows a special use process.  Billew said he would like to sit down with business owners that wish to use and are using these signs to come up with uniform standards; and placement should also be regulated.

Council instructed Mr. Billew to make requested revisions and if possible have ready for First Read by May (2nd) Meeting. If revised ordinance draft is not ready for May meeting, then it will be placed on May’s Work Session agenda.

SDS (Service Delivery Strategy) BRIEFING---Mayor Johnson asked Mr. Randy Meacham, Managing Director of Gwinnett Municipal Association to give a briefing about the SDS, cities verses the county litigation.  Factors that have impacted this issue are resignation of commission chairman, two new commissioners and sheriff officers assuming radar duties for cities involved in litigation. Cities with police departments involved with this litigation

In late November of last year the county and the cities sat down in an Executive Session. The cities and county presented their versions of a satisfactory solution.  From that meeting the cities drafted a consent order and sent it to the county. And the county did not act upon it.

Meacham said with new commissioners (Heard and Howard) coming on board in January efforts were made to educate them about what had happened. Commissioner Howard asked for portions of transcripts and both commissioners met with several of the mayors from cities involved. From December 15th to date nine letters have been issued about service delivery, showing activity. Prior to new chairwoman joining commission, the cities had been asked via a staff letter to put together another proposal; they complied.  He said the county responded by letter expressing disappointment at what the cities had proposed and the position they had taken.

Cities part of the SDS Committee decided not to issue any more proposals. In mid-March the cities informed the presiding judge that the cities have made good faith efforts and that the door is still open; they also asked the judge for his ruling. The county’s attorney challenged some of the statements written in the cities letter. The letter issued by the cities on April 20th was an attempt to clarify those challenged statements to the judge.

Both parties, the county and cities are under judge imposed sanctions. Part of the law states that municipalities lose their local qualified government status, if there is no valid service delivery agreement in place. This is an unprecedented case; no other cases have gone this far.

Parties are awaiting the judge’s ruling.

Councilman Powell asked if cities win, what does that mean for citizens. Meacham said he would give the cities version of an answer.  At issue, he said is tax inequity that ranges from 10 to 28 million, depending on when the study was done. The county said, at the start, that there is no inequity, and the cities disagree. The big (service) categories are roads, planning and zoning and police public safety.

The cities position is that the county should establish special tax districts. All cities should provide planning and zoning functions and to some extent some road functions. County should tax for those roads. There are nine cities with police departments. The county, therefore, should not be accessing a tax for county police services, because they provide their own police services.  

If tax inequity is determined, could be seen as a relief on county tax bill that could amount to a one mil reduction. The amount of inequity would be spread among the 15 participating cities.

Councilman Martin said with cuts made by the county, the cities might be asking for something that the county might not be able to do. He said if the judge rules in favor of the cities but we have a bankrupt county, what do the cities do then.

Meacham said that new commission chairwoman Charlotte Nash has said she would like to get the right people in the room to resolve this situation.

At the conclusion of the Work Session agenda, the council moved into Executive Session.