To: Councilman Richard Sensenbrenner, Chair Development Committee

From: George J. Arnold, Director Department of Trade and Development

Subject: Economic Development Agreement with the Gateway Area Revitalization Initiative

The Department of Trade and Development seeks City Council authorization to enter into a development agreement with the Gateway Area Revitalization Initiative, a Campus Partners affiliate. This agreement sets forth the pledges and commitments of the city of Columbus and the Gateway Initiative for the redevelopment of an area in the vicinity of High Street from Ninth to Chittenden Avenues (see attached map).

Background

Early in 1995, Campus Partners identified the need for a major mixed-use redevelopment project in the vicinity of High Street and Eleventh Avenue to anchor the revitalization of High Street and Eleventh Avenue to anchor the revitalization of High Street in the South Campus area. Later that year, an advisory panel from the Urban Land Institute affirmed the need for the redevelopment project. The redevelopment concept for the Gateway Area was included in the University Neighborhoods Revitalization Plan: Concept Document that was adopted by City Council in 1997.

Following adoption of the Concept Document, Campus Partners retained a consultant firm to refine the redevelopment concept and develop an urban design plan and standards for High Street. A 40-member advisory steering committee was convened to give input to the consultants. At this time, Campus Partners also initiated land acquisition activities in the Gateway Area. To date, Campus Partners has acquired approximately 85% of the project area.

Campus Partners launched a national Request for Qualifications process in August 1998 to identify developers with urban mixed-used experience who might be interested in developing the Gateway Area. Three teams were invited to submit proposals. Following an extensive public presentation and review process, Campus Partners in May 1999 selected The Druker Company, Ltd. of Boston as the preferred master developer for the University Gateway Center. Campus Partners was recognized with a Best Practices Award from the U.S. Department of Housing and Urban Development for the highly participatory nature of the developer selection process.

Economic Development Agreement

While the city of Columbus has been an active participant in all the planning processes undertaken by Campus Partners, it is now necessary and appropriate to formalize our relationship with their development corporation, Gateway Area Revitalization Initiative (Gateway Initiative) and establish the responsibilities of both parties in the implementation of the project. Key provisions of this agreement include:

Project Description - The project will consist of two elements: (1) a 400,000-600,000 square foot mixed-use development combining retail, office, entertainment and rental housing; and (2) adjacent off-street parking facilities, including a structured parking garage.

Acquisition of Remaining Parcels - The city agrees to purchase the land needed for the project, using funds provided by the Gateway Initiative and, if necessary, the power of eminent domain. The Gateway Initiative agrees to purchase the site from the city for redevelopment.

Relocation Plan - Prior to the initiation of acquisition procedures by the city, City Council must hold a public hearing and approve a plan for the relocation of persons, families, businesses and others displaced by project activities. We anticipate a hearing being formally held by City Council in January 2000.

Tax Increment Financing - The city agrees to establish a tax increment financing (TIF) district, using non-school revenues, to finance the construction of a parking structure. An ordinance authorizing the TIF will be submitted to City Council for legislative action on December 13, 1999.

Design Review Process - The city agrees to use its best efforts to establish a design review process for High Street within the University District. This provision is consistent with the University Neighborhoods Revitalization Plan: Concept Document, as adopted by City Council.

Public Improvements - The Gateway Initiative agrees to undertake and complete the necessary public improvements, including all necessary street relocations, widenings, traffic islands and resurfacing, storm and sanitary sewer installation and separation, public and private utility lines, sidewalks, lighting, street trees and streetscape furnishings. The city agrees to enter into a capital improvement agreement with the Gateway Initiative to make progress payments, or reimbursement, for costs incurred in the construction and installation of all publicly bid improvements, not to exceed $5 million.

Eleventh Avenue - The city agrees to convert Eleventh Avenue to two-way traffic from High Street to I-71 and to, within five years, undertake any necessary resurfacing and install sidewalks, street trees and treegrates to make the street a first class connector and access way to The Ohio State University.

Vacation of Streets - The city agrees to vacate, at no cost, and transfer to the Gateway Initiative any secondary street, alley, sidewalk, or right-of-way which passes through the project area or is not needed for safe vehicular or pedestrian movement. It should be noted that this provision does not apply to either Eleventh Avenue or Chittenden Avenue.

Special Improvement District - The Gateway Initiative and the city agree to cooperate with property owners on the creation of a Special Improvement District for High Street within the University District.

Employment Initiatives - The Gateway Initiative agrees to work with established social service agencies and employment service providers to link both construction employment opportunities and commercial employment opportunities created by the project with the employment needs of the residents living adjacent to the project.

Public Benefits of the University Gateway Center Project

The participation of the city of Columbus in the University Gateway Center project will result in the following public benefits:

• Leverages over $95 million of additional investment, most of which is located in the Columbus Empowerment Zone.
• Secures a commitment of over $16 million from The Ohio State University in community revitalization.
• Creates employment opportunities for residents of the Weinland Park and other adjacent neighborhoods.
• Addresses an area that has placed heavy demands on city police services. Public safety should be significantly enhanced upon completion of the project resulting in significant cost savings to the city.
• Provides a "state of the art" example of mixed-use developments for other central city redevelopment sites.
• Encourages residential reinvestment on East Eleventh Avenue and in areas adjacent to the project site. Creates a momentum for further reinvestment on High Street towards the Short North.
• Increases property tax revenues to the Columbus Public Schools and income tax revenues to the city of Columbus.
• Strengthens High Street businesses by providing convenient parking.
• Serves as an excellent model of how a TIF can be used to finance improvements in distressed central city areas.

I hope you find this memo helpful in understanding the provisions of the Gateway Development Agreement and the significant benefits we will realize from this significant central city investment. I would be pleased to provide whatever additional information you may desire.

Gateway Area Map