Guess first, economic development, right?

Good afternoon.

Today is Monday, April the thirteenth, twenty twenty six.

This committee of finance diversity, equity, and inclusion is called to order.

Madam Clerk, please call the roll.

Here.

Present.

Thank you.

We now have a quorum.

I'm going to bring up our guests first, and I believe we have a guest from uh Department of Development as well as uh Corman uh Jackson, if you guys can come up to the table.

This is for intro and consideration of passage tonight on the floor.

This is ordinance number four eight one dash twenty twenty-six by council members House Jones, Santana and Griffin by departmental requests and emergency ordinance to amend section sections one, two, and three of ordinance number seven forty-seven dash twenty twenty-four, passed July tenth, twenty twenty-four, relating to approving the addition of certain properties, property to the Northeast Ohio Advanced Energy District and providing for assessments of the cost of the special energy improvement project in the district.

Um afternoon, um, with um uh Bobby Bruno and Rich Moore House of Um KJK Law firm, who's a partner in the Erie View Tower Project.

All right.

So today uh we will be presenting on the Erie View Tower residential uh pace project, uh, and amending the existing legislation as there's been some changes in the lender, uh, the amount of the pace loan on some of the terms of it.

Thank you.

Uh, or energy efficiency standards.

Uh this can uh turn into favorable terms for the property owner and borrower uh for all of their green energy improvements.

This project specifically, I think everyone here is probably very familiar with this uh this stack in this tower, uh, the Erie View Tower project.

Uh it'll be a catalytic redevelopment of the Erie View Tower and uh galleria uh here in the nine twelve district downtown.

So that'll be a mix of uh apartments, uh the W Hotel, uh, some renovated office space, uh reimagined galleria space, and this pace financing is specifically concerned with the two hundred twenty-seven market rate apartment units uh that will be a piece of this.

Uh the lender is gonna be new vein green capital.

Um the loan amount is going to increase, uh, and that will also uh trigger the semi-annual uh special assessment and the aggregate amount of special assessments to increase.

So uh that will be finance private financing up to uh 50 million uh 443913 uh and with that happy to uh turn it to Mr.

Moorehouse if he has anything you'd like to add or answer any questions.

Just hit the green button and pull it up close to you as possible.

Uh on behalf of the development team, uh thank you, council for taking action on this legislation today.

Um the project is progressing along.

I'd like to provide an update on the project for you.

Okay.

Um city awarded a construction permit for the residential portion at the end of last year.

Um so as soon as this uh financing is recapitalized, uh the hard new construction can go forward.

As far as the rest of the project, the hotel drawings are in progress.

They will be complete in June 2026.

And shortly thereafter that uh the construction on the hotel will commence as well.

The demolition that needs to occur prior to the new hard construction commencing, it's mostly completed.

Um as you might uh see, or it might seem obvious, the portion of the demolition on the residential component, it's mostly completed, like 99%.

There's just a few remaining items, and on the hotel portion, it's a little less further along, but we expect that to be complete by the end of June.

Um the developer has been in continuing monthly uh communications with with CPP as soon as the hotel drawings are completed.

Um the issue is they need to understand what the electric service requirements are gonna be for both the hotel and the residential portions of the project.

They'll be able to go to CPP and have a basis for which uh to for CPP to give them a uh a contract.

So that's in that's in place or underway.

Um as far as the community benefit agreement process, no new hard construction has taken place, so there isn't really much to report in that vein.

The um construction manager is working with aka team and Jabali development on OEO and CBA requirements.

Um if uh everything goes according to plan, the project is estimated to be completed in December of 2027.

Um that's assuming that this legislation goes forward and that we can close on the recapitalization.

Okay.

So before I get any questions, just um want to make sure.

So basically the loan is increasing by 16 million or so.

What's that exact amount that the loan is being increased by?

And this is a private loan, right?

Okay, so it doesn't change city incentives.

This is strictly them working out a deal with the banker to tax themselves for an extra how much.

Uh yes, sir.

What's happening is that the senior loan amount is decreasing and the pace loan about is is increasing.

So there's the senior loan amount was what about 236?

236 million or something.

And now this this creates them a savings of about 16 million or something.

The I think uh you may be thinking about the total um amount of the project cost, but um I believe the prior amount of the pace was about 20 million.

Uh Mr.

Chairman, it was 16 million five thirty-six uh ten dollars uh subject to increase to a maximum amount of fifty million four hundred forty-three thousand nine thirteen.

Uh so uh tremendous increase of almost thirty-five million dollars uh in financing through the PACE program.

So basically the developer pretty much took uh because it didn't bid this being able to happen, they save about thirty-six million or so, something like that, right?

Uh Mr.

Chairman, rather than savings, it would just be a different source of finance.

Okay.

All right.

Um and is my understanding this was relieved by Councilwoman Santana and uh is Councilwoman House in favor?

Yes, she is.

Okay.

Uh Councilman Michael Pelisi.

Thank you.

Thank you, Mr.

Chairman, my honorable colleagues, and to the director and to the her staff and folks from um the project.

What I'm trying to understand is on your color coded tower.

If you would pull that up.

So what portion is under construction or demolition right now?

Yeah, he wants to see it.

Okay.

The green por and that's under construction now.

Um it's under demolition.

The green portion is as well as the orange portion.

The orange portion.

Which would be the from the first floor up.

Correct?

The first and third floor.

Yes, sir.

Yeah.

The in the course of this project or this um this assistance from the city, is the galleria included in it all to the administration.

Through the chair to Councilman Palencyc, uh the galleria is a component of the city's participation through the two tax incentives uh back in 2024.

This piece of financing will not relate to the galleria project.

Well, not really.

So do to the developer, do we have any idea what will happen to the galleria?

Can you use these mic?

Thank you.

Um the chair to the councilman.

Um I am on the legal team, so the design team is working with Mary and the Casu family on what's only going to be programmed in the galleria.

Okay.

Um as I said before at the previous discussions, and this is this has got to be what, about the fourth or fifth discussion we've had over this project at the table at least.

This is a major project in my opinion for downtown.

Because when you look at the struggles that we're confronted with right now, and I was talking to some people last week, um, downtown business people, you've got just up the street, you've got the closed hotel.

You've got uh reserve square in foreclosure.

Um you have other buildings either in foreclosure or facing foreclosure.

So this project, in my opinion, is critical, is um in trying to restart or jump start uh the malays and the problems that we're starting to see in the downtown area.

Um so um so I just so what you're would in essence what you're asking for is an extension.

Is that what you are asking for?

Through the chair to councilman Palencic, asking uh for the ability to assess more taxes over and above their normal property taxes so they can get more private financing that will be paid back through that special assessment.

Okay.

And so, but to the uh developers representative You believe this is a goal project?

Yes, sir.

Okay, that's what I want to hear.

Uh this is critical.

Uh because when again we look at the the challenges, you know, you've got um you've got that, then we're faced with the federal building right across the street here, not knowing what's going to happen to that thing.

Um led of some very bad decisions and poor decisions that are being made in Washington.

Um we have challenges for downtown.

Maybe the more challenges than we've had for years confronting us uh collectively, not only the administration but confronting council.

And so I just want to make sure that the action that we're taking, Mr.

Chairman, um, is the appropriate action and that this project is real and because I believe if this if all this takes place that has been laid out to us, this could be a catalyst for additional uh development and opportunities downtown.

I can remember when this place was hopping, uh when the galleria was the place to go during the day, especially for downtown employees and workers, and then uh the high rise, the high rise itself, air view, uh was the um besides I think it was the second, if I'm not mistaken, the second high rise outside of um Tower City or the terminal, uh I believe at the time.

Um so again, this is a very important project.

So I'm I'm here to support it, Mr.

Chairman, and I hope it really has the impact that we're all expecting it to have on downtown.

Thank you.

Thank you.

Councilman Brian Casey.

Thank you, Mr.

Chairman.

Mr.

Chairman, to our presenters.

What is the what what does this change in the ask for the city of Cleveland?

I I see here that between the city and the county, there's semi-annual payments of 2.3 million, right?

What is the what would be the current, what's the current ask, and then what's the difference if we if we pass this through the chairman to uh councilman Casey.

So the current ask is uh for the developer to assess about a quarter as much extra property taxes onto their uh property to pay this financing tool back, and they are just asking for mission for permission to assess themselves uh more additional assessment.

So, in terms of city dollars, uh the ask was zero for this piece of the project, and it continues to be zero if that helps answer.

All right, so Mr.

Chairman, to our presenters, basically um they're asking to increase their property value.

Is that what they're asking?

Increase uh special assessments on their property tax uh to pay back financing.

Uh so with this tool, rather than paying the bank back with uh bank note, they'll pay it back with a special assessment over and above the regular property taxes.

So they'll so they'll use third party money basically to pay back their loan.

All right, and this is a good deal for the city.

Yes, I mean it allows them to close um and uh get this building um into good use.

And then Mr.

Chairman representers, my last question is this does not cost the city anything?

No.

And I and we're not they're we're not losing any property taxes.

Um, anything like that?

No, this does not um impact any of our other participation.

Okay, all right.

Thank you, Mr.

Chairman.

Thank you.

Do we have any other questions regarding ordinance number 481 dash 2026?

Um just one last question.

I know that a lot of the theme around this was supposed to be around sports.

Does that matter anymore?

That the project, um I know we originally had it presented, that we may not have uh one of the teams down there.

Does it matter?

Um Mr.

Chairman, I think it it does matter, but like the rest of the city of Cleveland, you know, we're gonna move forward and make the best out of everything.

Okay, and the reason I ask that is because what a lot of you know, and remembering and studying this project, because it really has been on the block for a long time.

Um, this is one of the higher end hotels in the United States of America.

So, to my colleague, Councilman Michael Polencick's point, this is really like what I from what I understand.

One of the W's are very few and far in between.

So I'm excited and glad that this can move forward with this uh pace financing.

I would like at some point, um, and I know that you guys have a lot of interest in things at KJ um KJK, but um I would like for you to have this discussion with us around pace financing, because um I believe we're going to start getting more requests, and I think that this council needs to be a brief better to make sure that we understand because I know we haven't done a lot of residential pace, we've done mainly business pace or commercial pace, and we need to make sure that this council understands how that works and how that operates, okay?

Yes, Council President.

All right, thank you.

See no other questions, ordinance number 481-2026 will be heard for um consideration for the entire council this evening.

Thank you.

Appreciate it.

We'll go to public safety.

This ordinance is ordinance number 359-2026 by Council members Polensk and Griffin by Departmental Request.

An emergency ordinance authorizing the mayor and or the director of public safety to apply for and accept a grant from the United States Department of Homeland Security, FEMA, for the fiscal year 25 port security grant program and authorizing the purchase by one or more requirement contracts for safety equipment for use on the fire boat, supplies, and operations search and rescue training needed for the division of fire, department of public safety.

Yes, sir.

Uh good afternoon, uh Council President, Council members.

Uh, with me uh to talk about this legislation.

To my right is uh Fire Chief Wayneeda, and to his right is uh Michael Gellman, who is the our uh financial guru, I like to call him in her in the uh Department of Public Safety.

Um this legislation ordinance, which is uh 359-2026.

This legislation would authorize the Director of Public Safety myself to apply for and apply and accept a grant in the amount of $205,700 and ninety dollars from the Federal Emergency Management Agency, FEMA for the fiscal year twenty-five port security grant program for maritime equipment and training for the division of fire.

The grant requires a cash match in the amount of sixty thousand.