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HRA Minutes 09-07-2005 . MINUTES MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY Wednesday, September 7th, 2005 505 Walnut Street - Bridge Room Commissioners Present: Steve Andrews, Brad Barger, Bill Fair, Darrin Lahr, and Dan Frie Council Liaison Absent: Wayne Mayer Staff Present: Rick Wolfstellcr, Ollie Koropchak, and Angela Schlunann. I. Call to Order. Chairman Lahr called the meeting to order at 6:00 PM and declared a quorum. 2. Consideration to approve the August 161h, 2005 special HRA meetinJ..': minutes. MOTION BY COMMISSIONER BARGER TO APPROVE TIlE MINUTES Of THE SPECIAL lIRA MEETING OF AUGUST 161,\ 2005. . MOTION SECONDED BY COMMISSIONER FAIR. MOTION CARRIED. MOTION BY COMMISSIONER BARGER TO APPROVE THE MINLrrES OF TI IE SPECIAL HRA MEETING OF AUGUST 29111,2005. MOTION SECONDED BY COMMISSIONER ANDREWS. M(JfION CARRIED 4-1, WITH FAIR ABSTAINING DUE TO ABSENCE. 3. Consideration of adding or removinJ..': items hom the aJ..':enda. Koropchak added as other business, the following: a. Preparation and feedback for proposal to interested business b. Update on Rocky Mountain Group, LLC project . 4. Consideration to adopt a resolution approving the elimination of parcels from TI F District No. 1-22, located within the Central Monticello Redevelopment Project No.1 in the City of Monticello. MOTION BY COMMISSIONER FAIR TO ADOPT A RESOLUTION APPROVING THE ELIMINATION OF PARCELS FROM TIF DISTRICT NO. I IRA Minutes 9/7/2005 . 1-22, LOCATED WITHIN THE CENTRAL MONTICELLO REDEVELOPMENT PROJECT NO.1 IN 'rHE CITY OF MONTICELLO. MOTION SECONDED BY COMMISSIONERANDREWS. MOTION CARRIED UNANIMOUSLY. 5. Consideration of approve a resolution adopting the modification to the Redevelopment Plan for Central Monticello Redevelopment Proiect No.1 and establishment of Redevelopment TIF District No. 1-35 and its Plan thereto. Koropchak provided the HRA with the condensed version of the inspector's report. Koropchak reviewed the inspector's report briet1y, including the conclusion, which is that the proposed TIC District qualifies as a TIF Redevelopment District. The project also qualifies under the substandard conditions and coverage test. Koropchak reported that the findings are included for both items, along with narrative for each parcels and photo review. Koropchak stated that the developer had also submitted a revised copy of the but- for information. Lahr asked if it met requirements. Koropchak commented that it appears that their rate of return on equity went down slightly. . Koropchak stated that the resolution also changed slightly in terms of the language regarding findings. Brad Johnson, developer, discussed the cost to buy, move and renovate the home located on the parcel to be removed from the district. Johnson noted the home will be owner occupied and is being purchase by current renters. MOTION BY COMMISSIONER FAIR TO APPR.OVE A RESOLUTION ADOPTING THE MODIFICATION TO THE REDEVELOPMENT PLAN FOR CENTRAL MONTICELLO REDEVELOPMENT PROJECT NO.1 AND ESTABLISHMENT OF REDEVELOPMENT TIF DISTRICT NO. 1-35 AND ITS PLAN THERETO. MOTION SECONDED BY COMMISSIONER ANDREWS. MOTION CARRIED UNANIMOlJSL Y. 6. Consideration to adopt a resolution approving the Contract for Private Redevelopment by and among Masters 5th A venue, I nc. and the Housi ng and Redevelopment Authority in and for the City of Monticello. . Koropchak reviewed the contract report. noting thc biggest change related to the $20,000 the HRA had previously approved for the purchase or the Koppy garage. 2 liRA Minutes 9/7/2005 . Koropchak noted the resolution had cited the funds as a loan. In fact, the funding approved by the HRA was as an up-front grant from district 1-22. Lahr clarified that it had been changed in the new document. Koropehak confirmed. Koropehak explained that Johnson wanted to discuss the utility pole situation on the site and the options for relocation. Koropehak noted elevations were included for reference. Johnson stated that there had been a parking deficiency with L,andmark 1. With this project, the developer will be improving the circulation and creating more overall parking. Johnson noted that the restaurant and retail uses will need to work together. In their calculations, about 53 spots are needed for the site. Johnson stated that they are at slightly less than that. Counting the on-street parking, Johnson indicated they have 61. "1"he original project was short and money was put into parking fund to pay for the deficiency. . Johnson reviewed building plan and indicated that two confirmed tenants are Nexus Financial and Jam 'n Joes. In terms oi'the utility pole, there arc three alternatives for pole. The project architect is working with the issues. Johnson stated that Xcel Energy is backlogged and cannot deal with this issue currently. Johnson indicated that they have budgeted $20,000 to deal with this issue, but it may cost up to $50,000. Johnson indicated that Masters 5th A venue has a fixed budget with Nelson Development, which requires that anything extra cost comes out of the building. Johnson commented that they don't want to do this; the alternati ve is to come back to I-IRA. Koropchak reported that she drove back to view the situation. Itis a major site constraint. There is also a pole by the carriage garage next to Locust. Johnson reported that there are lines that connect to this pole. They will put in a new transf<')[Jner and that one will be removed. Koropchak reported that this was also a new resolution identifying the $20,000 as grant and notes that the HRA Chair or Executive Director can make minor changes to the contract. Johnson stated that the attorney has no problems with the contract. Koropchak noted the pole cost is not currently included. MOTION BY COMMISSIONER ANDREWS TO ADOPT A RESOLUTION APPROVING TI--IE CONTRACT FOR PRIV ATI~ REDEVELOPMENT BY AND AMONG MASTERS 5TH AVENUE, INC. ANI) TIll'; HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR TilE CITY OF MONTICEf.I,O. MOTION SECONDED BY COMMISSIONER BARGER. . '" -, lIRA Minutes 9/7/2005 . MOTION CARRIED UNANIMOUSLY. 7. Consideration to authorize payment ofHRA bills. MOTION BY COMMISSIONER FAIR TO AUTHORIZE PAYMENT OF HRA BILLS. MOTION SECONDED BY COMMISSIONER BARGER. MOTION CARRIED UNANIMOUSL Y. 8. Consideration ofthc Executivc Director's Report. Koropchak reported that she had written a lettcr of support t"t)f Twin City Die Cast, who will be submitting a grant application for about $250,000 to train 260 cmployees over 3 years. . Koropchak asked Lahr to provide an update on thc potentialmcrger of City organizations. Lahr reported that Wolfstller, O'Neill, Koropchak, HRA attorney and Ehlers representative had bcen in attcndance at thc meeting. He stated that Bubul didn't havc a formal recommendation as there did not appear to be an overwhelming efficiency reason f()f one body instead of two. Lahr noted that therc is a differcnce in that the HRA does not have a Council member as a voting member. However, the EDA can own and lease buildings and has loan powers. Lahr stated that it camc up that the EDA could fold into the Council since the EDA only meets quarterly and includcs two voting Council members. In that case, the EDA would meet adjacent to Council. The HRA would do thc review work and make a recommcndation. Lalu stated that O'Ncill is to report to personnel committee on this discussion. Koropchak stated that her conclusion was slightly different. Koropchak stated that Bubul had indicated he felt there was a uniqueness about Monticcllo in that many citizens want to be involved. She felt that I3ubul and RufT encouraged separatc organizations. Koropchak also noted thc discussion regarding thc IDC and potential audits in non-City related cxpenses. Bubul had rccommendcd that perhaps the IDC should bccome advisory to thc Chamher or HM. Lahr stated that it was made clear it was a personal, not legal opinion. 9. Committcc Reports: . Koropchak reported that Lynnc Dahl had gotten an invoice for the billboard. Harger askcd it hits have changcd since wcbsite movcd. Koropchak stated that phone calls have incrcased. Barger asked where most leads are coming from. 4 [-IRA Minutes 9/7/2005 . Koropchak reported that she had received 2-3 from the trade show, and the others from billboard or brokers. 10. Other Business A. Preparation and reed back for proposal to interested business Koropchak noted that there had been some questions on how proposals are prepared for potential industrial/business park buyers. I n response, she indicated that she will be on a site visit in late September. Koropchak asked for a volunteer to attend. Frie stated he would try to attend. Koropchak had also spoke with Hubul and Ruff, who had recommended not putting any information relative to park fees in the marketing materials, as ordinance does not call for industrial park fees. In terms of the site visit, Koropchak stated that she had initial concerns about the nature of the business in terms of wastewater treatment. Public Works Director John Simola will be attending to assist in that analysis. . Using the information provided, the proposed use is planning on a 20,000 square foot office, prod uetion and storage facility. If usi ng HRA criteria, they would be allowed 1.83 acres of land at a reduced rate. Koropchak reported that the building would have a market value of approximately $1 million, and create 20 full time jobs, which would allow 2.5 acres at $1 per square foot. They have 16 jobs with an average wage of$21.37 without benefit. The user would plan to hire 4 more employees in two years at over $18 per hour. Koropchak stated that they arc not asking for a large amount of property. They would pay approximately $80,000 for 1.83 acres. Koropchak asked whether the HRAis set on a minimum lot size of 2.5 acres. Koropehak stated that it was her impression that jobs and wages were more important. The HRA Commissioners indicated that they had no problem with not doing 2.5 acres. l1arger asked how the user heard about us. Koropchak reported that they had been visiting with other communities and had heard that way. Fair asked how things were going on the park site. Koropchak stated that sand and curbing would be put in this week, with the first layer of asphalt in two weeks. The intersection at 90th and Chelsea would be going through this month. b. Update on Rocky Mountain Group, LLC project . Koropchak noted all contracts are signed and she has authorized the dirt pile to be moved. The closing is scheduled to be on the 20th of September. 5 HRA Minutes 9/7/2005 . Koropchak gave the HRA members a eopy of the changes agreed to after the last contract the HRA received. Lahr stated that the minor changes included changing general grading to final grading and allowing the buyer to keep 40,000 cubic yards of sand. Lahr stated that in the end, the HRA will not spend more than $45,000. Koropchak stated that Rufl re-ran TIF cash~ f10w numbers for the project. The preliminary numbers had a valuation of $64 per square foot and a market value at $3.2 million. Koropchak stated that Rocky Mountain had agreed to the $2.9 mill ion. After increasing the amount of assistance, the assessments were re- calculated, and the tax increment over the life is $415,000 at net present value. Koropchak stated that the II RA can hope that the value goes up and that the $440,000 in assistance can be covered. Koropchak reported that based on today's value, the II RA is short in terms of dollars. 11. Adjournment MOTION BY COMMISSIONER FRIE TO ADJOURN AT 7:45 PM. MOTION SECONDED BY COMMISSIONER ANDREWS. . MOTION CARRIED UNANIMOUSLY. ..{ ,,!Lf0-"-~.___ . 6