Redevelopment commission approves notice to end private leases at Showers West, sets Dec. 13 deadline

The Bloomington Redevelopment Commission on June 2 approved a resolution directing staff to begin terminating private leases at Showers West so the city can move the building to full public use required under prior bond covenants.

The vote followed lengthy discussion about relocation assistance, the statutory standard for damages, and a public comment period in which tenants and community groups said the proposed timeline felt short. Commissioners amended the resolution to change the target date for vacatur from Oct. 13 to Dec. 13, 2025.

Why it matters: Showers West is city-owned property purchased with bond proceeds that the bond documents and federal tax rules require be used for a public purpose. Keeping private tenants in place indefinitely could put the city out of compliance with those agreements, city attorneys said. The decision starts a process of negotiated relocation payments or court proceedings if negotiations fail.

Legal and process details: City counsel explained the legal standard that will guide relocation payments, noting the city will “assess their damages” under an approach similar to relocation compensation in an eminent-domain context and that the specific statute cited for that process is included in the resolution. Staff emphasized the compensation must be tied to actual, reasonable damages (moving costs, difference in rent or mortgage, reasonable mitigation steps) rather than simply the remaining value of the lease.

Commissioners and staff said they will attempt negotiated moves for the eight tenants in the building, with the corporation counsel’s office, other city attorneys and outside advisors available to assist. The attorney presenting the plan said she put her personal cell phone number in letters to tenants and plans door-to-door outreach to begin negotiations. She said, “My goal is that we would be able to get the tenants moved out by October,” but commissioners adopted the later Dec. 13 date to give tenants additional time.

Public comment and tenant concerns: Several tenants and representatives asked for a longer timetable and requested clearer, written guidance on how relocation damages would be calculated. A commercial broker recommended the RDC engage an external relocation or valuation consultant to explain the standard “buckets” of damages and calculation methods to reduce disputes. A nonprofit tenant asked the commission to be flexible because finding new space can take many months.

What the commission directed: Commissioners voted to authorize staff to provide written notice to terminate the leases and to begin negotiations. Staff was directed to provide the RDC with lease expiration dates for each tenant and to report back on negotiations; the commission also reserved the ability to call special meetings if necessary.

Outcome: The resolution (25-58) passed as amended (Dec. 13 target) by a recorded voice tally of four ayes and one nay. The motion authorized staff to begin formal termination notices and to negotiate relocation payments; any settlements that require additional commission action or unusual terms will be brought back to the RDC.

Next steps: Staff will compile the eight tenants’ lease expiration dates and continue door-to-door outreach and negotiations. Legal staff said they will involve bond counsel where necessary to confirm compliance with bond documents and to determine whether limited extensions for build-out or other accommodations can be negotiated without violating bond covenants.