SUBJECT:
Title
A Resolution of the Board of Commissioners of the Town of Erie Urban Renewal Authority Approving a Purchase and Sale Agreement with the Diana Shannon Living Trust
Body
DEPARTMENT: Economic Development/TOEURA
Department
PRESENTER(S): Julian Jacquin, Director of Economic Development & TOEURA
Malcolm Fleming, Town Manager/TOEURA Executive Director
First Name Last Name, Title
TIME ESTIMATE: 15 minutes
only required for non-consent items
FISCAL SUMMARY:
Cost as Recommended: $500,000
Balance Available: $1,350,000
Budget Line Item Number: 800-90-872-604000-249001 (Property Acquisition)
New Appropriation Required: No
POLICY ISSUES:
The policy issue is whether to support the use of URA funds to purchase two lots (approx. 15,000 sq. ft.) of vacant land in the Historic Old Town URA, with the intent to advertise this land for sale to developers, activate it for new commercial/mixed-use development and generate new tax increment finance (TIF) revenue in the URA, new property and sales tax revenue for the Town and other taxing jurisdictions, and new employment and business opportunities for Town residents.
STAFF RECOMMENDATION:
Recommendation
Approve the Resolution to purchase this property in the Historic Old Town URA.
End
SUMMARY AND BACKGROUND OF SUBJECT MATTER:
The Town of Erie Board of Trustees adopted the Historic Old Town Erie Urban Renewal Plan Area (“Historic Old Town URA”) on Nov. 12, 2013, to assist in eliminating blight and facilitating redevelopment of this area. As a direct result, several new mixed-use projects have developed in this area over the last five years, each using property tax and sales tax incentives available through the URA. The Historic Old Town URA provides a financing mechanism to assist in the development and redevelopment of properties in this area, which ultimately increases property valuation and generates additional new property/sales tax increment to support new projects in the plan area.
Two properties located at 130 Wells St. and 570 Kattell St. in the Old Town URA are owned by the “Diana Shannon Living Trust” (c/o Diana Shannon). Ms. Shannon purchased these two properties in 1999 and 2012, respectively, initially considering new development opportunities for both parcels, but ultimately never chose to move forward with any proposals. The central location of this Site and immediate proximity to Downtown Erie and Coal Creek Park provides the Town with extra potential for seasonal use and community activities. In Nov. 2020, the Town executed a three-year lease with Ms. Shannon for exclusive use of the Site, at a rate of $1.00 per year for three years, which was thereafter extended through Nov. 2025. The Town is obligated by the lease to maintain the Site and pay for utility expenses. Since that time, the Town has invested in several improvements to the Site, including the removal of a shed, site grading, and the installation of new water and electric meters to accommodate the future developed use of the Site.
The Town has been in contact with Ms. Shannon about her interest in selling, or developing the Site since 2022, and presented a Letter of Intent (LOI) for TOEURA to purchase the Site in Oct. 2023. Per the URA’s adopted Purchasing Policy, the Town contracted with CBRE to complete an appraisal for land valuation in August 2022, which informed TOEURA’s negotiations in reaching an approved purchase price. Ms. Shannon approved the LOI in January 2025. The purchase price of $500,000 is higher than its appraised value ($405,000 in 2022) but supported by TOEURA’s intention to purchase and control the outcome of this well-located Site for its highest and best use.
The Town/URA recommends executing the Purchase and Sale Agreement to purchase this vacant land intentionally to obtain competitive interest from private groups to purchase and develop the site, activating it for new commercial/mixed-use development, and generating new tax increment financing (TIF) revenue for the Historic Old Town URA. Utilizing URA funds is compatible with the Historic Old Town URA Plan, advancing actions related to the development of vacant and under-utilized parcels, and developing and enhancing gateways to Historic Old Town. Purchasing this site will facilitate the development of commercial uses at this location, increasing the local tax base, creating new retail store opportunities, and attracting new daytime jobs to Old Town Erie. Additionally, the Town has already received development interest from private groups for this parcel, so acquiring it will allow the Town/URA to work directly with those groups to secure the highest and best use for the site.
COUNCIL PRIORITY(S) ADDRESSED:
ü Attractive Community Amenities
ü Prosperous Economy
ü Small Town Feel
ü Effective Governance
ü Fiscally Responsible
ATTACHMENT(S):
1. Resolution 25-028
2. Exhibit A: Purchase and Sale Agreement
3. Presentation