HRA Minutes 05-02-2001
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MINUTES
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
Wednesday, May 2, 2001 - 7:00 p.m.
505 Walnut Street - Bridge Room
Members Present:
Chair Dan frie, Steve Andrews, Bob Murray and Council Liaison Brian
Stumpf
Members Absent:
V ice Chair Brad Barger and Darrin Lahr
Otlieers:
Executive Director Ollie Koropchak and Recorder Lori Kraemer.
Guests:
Mike Cyr, MLC Building & Remodeling, Inc.
1. Call to Order.
Chair Dan frie called the meeting to order at 7 pm.
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Consideration to approve the HRA minutes of April 4. 2001.
It was notcd thc motion of April 4 to appoint Stcvc Andrcws to the Monticello
Community Center Advisory Board was subject to research of the ordinance establishing
the Hoard. In doing the research, the ordinance established reads: Hoard members are
appointed for three-year staggered terms. Bob Murray was appointed by the Council for
a term ending December 2003. Also, the ordinance does not specify that a MCC member
must be representative of the HRA.
Therefore, A MOTION WAS MADE BY STEVE ANDREWS TO AMEND AND
APPROVE THE MINUTES Of THE HRA MEETING OF APRIL 4.2001 TO READ:
liRA COMMITTEE APPOINTMENTS AS MCP - STEVE ANDREWS AND
MARKETING COMMITTEE - BRAD BARGER. MOTION WAS SECONDED BY
DAN FRIE. Motion carried with Bob Murray Abstaining.
3. Consideration to add or remove items from the agenda.
Koropchak advised that Rich Cline was present to approach the HRA members regarding
the house at 21 g Front Street. This was placed with \tenl 5 on thc agenda.
4. Consent Agenda.
A. Consideration to approve the Certificate of Completion for Cedrus Creek
Craftsman, Inc.
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HRA Minutes - 05/02/0 I
A MOTION WAS MADE BY STEVE ANDREWS AND SECONDED BY BOB
MURRAY TO APPROVE THE CERTlnCA TE OF COMPLETION OF THE
CONTRACT FOR PRIVATE REDEVELOPMENT HETWEEN THE liRA AND
CEDRUS CREEK CRAFTSMAN, INC. Motion carried unanimously.
5.
Consideration of update and action relative to a portion/whole of Blocks 54 and 64 all
located within TI F District No. 1-22.
· Ollie Koropchak, Executive Director. updated the members regarding the
Prcliminary Development Contract which has been executed by Hans Hagen and
noted that the $5,000 deposit fee was submitted. A project description was
provided. WSH, Inc. has provided information relative to street elevations as
requested.
· Koropehak stated that the HRA did close on the Bostic property on Monday,
Apri I 30, 200 I. llowever. to obtain legal or clear title, it is necessary to go
through quiet title action. It appears we can get on the court calendar and still
demolish after June 15. 200 I, and the seller is responsible f()r clear title. Public
Works requested to check out undcrground fuel tank, 48-hour noticc of
authorization obtained. Koropchak advised that they did do the testing and it
appears to he okay.
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Koropchak advised that they have not obtained a signed purchases agreement on
the O'Connor property at this time. but a target date to close is set for May 31,
200 I, and the attorney has ordered thc abstract updated. Koropchak added that
they arc hoping to reach an agreement but have not yct heard back ti-om Mr.
O'Connor regarding his husiness (evidence of income tax). We received a
counter-oiTer from O'Connor via his attorney rcquesting to remain in house
another year, relocation benefits for his business, to move the house, and other
items. Response: Planned closing date and possession date, May 31. 2001;
business relocation compensation negotiated upon evidence of business income
tax filed; and no to moving the house. Other minor adjustments made to the
purchase agreement. Purchase price $130,352.
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Rich Cline, City Public Works employce, inquired as to the possibility of
acquiring and moving the O'Connor house to restore and fix-up. Koropchak
advised the members that she and Chair Frie had previously made an executive
decision to reaffirm the I-I RA' s direction to allow the iire department to use
homes for test burn. The J IRA must kecp in mind the ohjectivc of a
rcdevelopment district is to remove substandard structures, not move substandard
structures.
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Rich Cline approached the liRA members to reconsider their decision and stated
that he had worked diligently to work on plans to get the house moved, had
spoken to a mover who stated he would need 3 days to move the house, had
gotten some estimated costs, and had initially wanted to bring a letter from his
bank stating he has sufficient finances to acquire and move this house, but time
did not permit this. He also stated he had spoken to a member of the Fire
Department regarding their request to test burn all three houses and was advised
that it would be acceptable to them to get two of the three houses. He also stated
he felt this house was structurally sound enough to warrant moving.
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Frie asked where Cline would propose to move the house to and he stated that it is
not his intention to move it to another location in Monticello just to create another
blight and also noting he has not found a lot in Monticello at this point but had
been looking at possibly moving it to Clearwater, although he stated he would like
to keep it in town and his intentions are to fix it up so it is not a blight. Frie stated
that this had been discussed at the previous meeting and that they felt they didn't
want to move the house due to a time line as well. Koropchak also provided
inf()rmation from the owner's attorney asking to allow the O'Connor's to rent the
house after the closing date, but also noting they did realize the City was not
willing to do this. Koropchak stated the Attorney's question was what is the
City's intent of the house, stating the client's intent would be to moving the house
to another property if the City would not be razing it.
It was discussed that the liRA would have to advertise the house for sale if they
so chose to which would involve a public hearing, and this would still have to be
done by June 30, if at all possible. If the BRA's interest is still having the Fire
Department test burn, the Building Oi1icial stated this may not be a good location
due to the number oflarge trees and the need to preserve them. Murray asked
Cline if he had determined the costs to bring the house up to code and he stated he
had, and also that he does most of his own work. Again Cline stated that if there
was a chance in moving the house out of there he would like to have a chance at
doing so. Cline noted some savings in him moving the house rather than the City,
noting the need to getting rid of all the debris if it cannot be burned. Koropchak's
concern is that the O'Connor's had asked the same question and she had told them
no.
Brian Stumpf stated he was a little afraid of them going back to the Attorney at
this time without the purchase agreement signed. The mcmbers felt it was
prcmature to make a decision of this kind at this time. Frie stated the HRA could
not act on this without a purchase agreement, stating the IIRA' s goal of
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redevelopment, not buying and selling homes. Frie addcd that thc HRA may be
able to look at this again at a later date. Murray stated that if this structure were to
be made livable, it would be less expensive to renovate the house vcrsus building
new. He also asked how long it would take to come to an agrcement with the
O'Connor's and Koropchak advised they do not know at this time. Koropchak
also stated that the Building 0t11cial had stated that the structure was substandard
and therefore qualified for TIF assistance. Again, they stated that the house is
structurally sound.
The HRA asked Cline ifhe would be able to move on this in a short period of
time ifit was the decision of the HRA to allow the house to be moved, and he felt
he could, stating he would do what he could. Steve Andrews stated that Cline
may be bidding against others at a public hearing, no guarantees, and he stated he
understood that and was still interested. It was advised that this will be looked at
again next month at the HRA's June meeting.
A MOTION WAS MADE BY BOB MURRAY AND SECONDED BY STEVE
ANDREWS TO ADOPT A RESOLUTION REQUESTING A LOAN FROM 'THE CITY
TO ACQUIRE THE 218 FRONT STREET PROPERTY. Motion carried unanimously.
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Koropehak advised that she had talked with Larry Schlief about the lIRA's plan
to pay-off the Contract for Deed for the property located at 3 Walnut Street.
Assuming the BRA has a signed Purchase Agreement on the O'Connor property,
the remaining principal balance as of August 2000 which is $61,619.43 would
need to be paid. Public Works requested to cheek property after tenants left. The
Public Works Department wants the garage as they re-roofed it, and also
requestcd the furnace and water heater for Public Work's use as thcy are fairly
new.
A MOTION WAS MADE BY BOB MURRA Y AND SECONDED BY STEVE
ANDREWS TO ADOPT A RESOLUTION REQUESTING A LOAN FROM TilE CITY
'TO PAY OFF THE CONTRACT FOR DEED ON THE 3 WALNUT STREET
PROPERTY. Motion carricd unanimously.
Koropchak stated she wi II put this item on the City Council agenda for May 14, 200 I.
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Koropchak authorized Rod Dragsten to complete an appraisal of the raw land only
on the Carlson property. This to establish a selling price of the raw land in
anticipation of selling the land to the City in 2002.
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HRA Minutes - 05/02/01
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The feasibility Study authorized by the City Council for replacement of the
water/sewer Jines and strect was acceptcd by the Council on April 23. However,
the Council did not call for plans and specs as this as it may be prcmature without
a signed Purchase Agreement on the O'Connor property. However, it appears
staff may now view this as a development improvement and not a rcplacement
improvement which means a differcnt assessmcnt policy. Cost $146,193.35
including 10 lot extensions.
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Per Hans Hagen's project description it appears hc's looking for the HRA to
demolish and this needs to be worked on. Timing with Fire Department is
critical. Koropchak advised that generally the City does not provide building pads
but a clean site. She notcd that Hagen is looking to the City to the demolitions
and Koropchak has moved forward on drawing up the requests for proposals.
This assumes demolishing the structures, not burning. Steve Andrews asked if
this was indeed helping thc Fire Department by giving them these houses for
burning and he stated absolutely. They again discussed the trees there and if they
could be saved, Scott Douglas would have to look at this. Koropchak asked if the
fire Department would be okay with I or 2, and he stated yes. They also
discusscd asbestos and he stated that is worked out through Anoka Tech. Dan
frie stated that the trees may be dcstroyed anyway when town houses arc put in
but Koropchak stated that the trces near the apartment site would be saved as f~\r
as she knew. She also said they would need c1canup after a burn as well and then
request for proposal may need to be revised. Can address this at the June meeting.
6. Consideration to summarize the direction of Citv Council for redevelopment of Block 52
and outline plan to proceed.
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Koropchak noted that Jeff O'Neill had taken the minutes at that meeting and are not
available at this time. She also thanked Dan fire and Steve Grittman for keeping the
meeting on focus. The workshop provided a good exchange of information and
discussion between key playcrs: property owners, potential developers, TI F counsel,
planning, Council, and liRA.
Summary of direction to liRA from Council:
"Work with interested property owners. Not interested in condemnation.
Appears good start. Procced with part or all of Block 52 as long range.
Fvaluate progress at end of year for need to pursue Lcgislative extension.", meaning that
Stevc Bubul had advised htat thcre are other communities that are in the same situation,
not able to spend the II F dollars in that time frame & had gone to the I.egislature for an
extension and Bubul felt it was a 50/50 chance.
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HRA Minutes - 05/02/01
Mayor - Not interested in reducing parking space. Go ahead with redevelopment. Mixed
use of retail, office and housing OK.
Herbst ~ Start with interested seller I ike Johnson. No reduction in parking.
Stumpf - l:xplore all of Block 52. Not interested in eondemnation.
Carlson - Agrees perhaps the useful life of the building are at end. Northwest corner
parking lot not convenient loeation as a parking lot today. An improved plan for the use
of the over~all existing public parking should be considered. Move forward.
Parking was the big issue, in all likelihood anything done in that area would need
extended property. His impression is that the city eouneil wants them to work with
owners in that area who may be interested in redevelopment. Their feeling is that wc
would use TIF for a start up but not neeessarily for all of it, to get a projeet going and
thcn maybe private redevelopmcnt take over from there. Stumpf stated that maybe the
cxisting owners have an idea of what they'd likc to see done in thc future with their
property. Koropchak proceeded in calling property owncrs (some), left voice mails with
scveraL no calls back yet, have arranged a meeting with the proposed project and some of
the owners, have a party of who is interestcd in this project, what is owners flexibility in
location and how they fit in/options. Frie stated that possibly at the next monthly mccting
they would have more information.
Pat Sawatzke, business owner, asked what the process is to get on the agenda and prescnt
a project to the HRA. It was noted to Sawatzke by Dan frie that Koropchak had only
contacted people on Block 52 at this point, some others have also stated thcy would like
to discuss options. Frie stated questions that would bc asked such as what the property
owner's interest is, are they willing to participate and would they like to meet. Sawatzkc
states that possibly some private development would occur as a result of these meetings.
He also appreciatcd that the members wcre listening to their concerns.
Koropchak providcd an outline of the plan to proceed as follows:
Who's in and who's out?
]. Fric and Koropchak to talk with interested party owners: Poirier, Johnson, and
Heaton.
2. Call Barney Gustafson for meeting of interest.
3. Call others Kjellberg, Springborg, and Froslie.
4. Inter-gradc Cyr project.
7. Consideration to discuss advantages and disadvantagcs of merging the EDA and HRA.
At a previous BRA meeting, the Executive Director's report indicated the Economic
Development Goals for 2001 included thc City of Monticello to explorc combining the
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powers of the HRA and EDA. The commissioners were asked at that time to give some
thought about the idea for discussion at a later meeting. The EDA discussed the items at
their annual meeting of April 24, 2001. A report oftheir discussion was presented. The
following are advantages and disadvantages discussed by staff.
Advantages
Disadvantages
Simplicity (one stop for developer.)
Improves communication with Council
assuming EDA would prevail.
One less meeting for statIo
EDA expand powers for development.
Hopefully improves attendance.
Less public participation.
II RA has power to levy.
Reduces checks and balances
as was original reason.
1'IF more complex.
Koropchak noted that she had spoken with Jeff O'Neill as staff. She advised that the
EDA can own and rent, EDA can levy, but the HRA has more independence. She also
noted the HRA is more complex, harder to understand.
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EDA felt the meetings would get too long, even though it would cut the number of
meetings down; discussed to improve attendance may change meeting time to 2 pm or 4
pm, asked Rick Wolfsteller to look into background of what was previously discusscd
regarding a merge. Decision maker would be the Council.
Dan frie stated hc felt the city council should do whatever they want, he has no feelings
either way. Koropchak stated it may not just be what the individuals feel, but how does
this all work, legal, mechanical. Frie also stated long agendas (my not make good
decisions if meetings get too long). Murray asked why the I-IRA couldn't approach thc
EDA by offering them properties thc lIRA fecls intcrested in, he also stated that if this
was not for the same functions, they should not be combined. Koropchak advised of all
the ditIerences. EDA was cstablished for setting up industrial loans, but from MN
Statutes point, thcir powers can be greater.
Steve Andrews qucstioned where thc push to merge was coming from. Koropchak
advised that it came from when sitting down cach year and looking at the roles of the
HRA and EDA with Jeff O'Ncill who had brought this matter up and felt it necded to be
rescarched. O'Neill also had had some discussions with the previous chair and it rnay
have come as a suggestion from him as well. Andrews stated this was talked about
previously, but that it camc back now and he doesn't understand why. Koropchak
advised that she necdcd commcnts showing she has cxplored and rescarched this matter
to bring back to O'Nci11. Frie stated hc was willing to absorb the EDA, but Murray
adviscd the length of the meetings again. Murray also asked if wc are duplicating efforts
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and Koropchak stated no stating that the lIRA does TIF and redevelopment, the EDA
handles industrial loans. Murray states if we are not duplicating any elTorts, we should
keep them separate. Andrews states he does not want to have this item come back again
and again, stating he is not interested, nor was anyone else.
8.
Consideration to authorize payment of the monthly HRA bills.
A MOTION WAS MADE BY BOB MURRAY AND SECONDED BY STEVE
ANDREWS TO PAYMENT OF THE MONTHLY HRA BILLS. Motion carried
unanimously.
9. Consideration of Executive Director's Report.
Amoco site - Brad meeting with restaurant owner on Tuesday. Bjorklund selling price
$170,000. Council accepted preliminary concept f()f use of l' IF. WAC/SAC to be
assessed and parking yet to be addressed. Koropchak advised that this was brought up to
the council, Brian Stumpf was upset that the WAC/SAC and parking had not been
resolved. Getting closer. Also, John Simola stated someone had been doing some testing
there.
St. llenry's - Preliminary concept for use ofTIF accepted. Concerned about amount of
TI F and number of years. (Number ofTIF District in City). Komarek working with St.
Henry's. Council has concerns about this to keep a watch on the amount ofTIF we are
doing, number of districts, feeling is that we arc getting quite a few TIF districts.
Scattered Housing Grant - Word has been received that the Monticello application for a
$500,000 grant from the MHf A was not awarded to Monticello. The intent is to re-
submit the application at the next round of appl ications. She spoke with Shari who stated
there were lots of applicants, basically ran out of moncy, she said we may do this fi:Jr first
time home buyers and that if we would have stated that, it may have been a stronger
application. Next round is in July, Shari has concerns about construction season, would
definitely come back to the lIRA bef()J"e resubmitting.
Small Machine Shop out of Eden Prairie - Three employees at $20 per hour without
benefits. Looking to construct 8,000 to 10,000 sq ft metal/wood frame structure.
Referred him to Lake Tool for land acquisition. Did not market "fIF, only loan program.
They have 3 lots in the second addition, but heard that they may have sold one of them.
St. Hens - St. Hens submitted the necessary infi:mnation as evidence for this TI F 110using
District to rcmain a "Qualificd Housing District." This means there is no LOA Penalty or
Local Match for the City. The 60-unit indcpendent facility has 39 units occupied with 24
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of those units meet the income and rent levels necessary for a qualified housing district.
IRTI - Decision on Icnder not made. Final and preliminary plat on Council agcnda June
11,2001. Waiting on submission ofTIF Plan to Wright until further moved along.
Frcedom Devclopment, Inc. - David Bell called and requested to be on the May HRA
agenda f(}!" acquisition and TIF assistance for development of the Country Club Manor
property. As you will recall, a few years ago he and David Hornig presented proposals
to the City Council for development. This in response to the City's request f()r
proposals. Bell requestcd TIF and Hornig did not. Neither project proceeded. Mr. Bell's
current idea is to construct 75 - 80 owner-occupied market rate and affordable
townhomes. Selling price $115,000-$120,000 for affordable units. At City site review,
Administrator Wolfsteller indicated he had received two other telephone calls from
developers interested in acquiring the property. At this point, no mention ofTIF. Mr.
Bell was informed that Mr. Wolfsteller will request the City Council to authorize again
going out for request f()r proposals. This scheduled for the May 14 Council meeting;
therefore, it is premature for Mr. Bell to attend the HRA meeting. Given the Council's
concern relative to the number ofTIF Districts, the HRA authorized a Housing Plan, and
the interest of developers in the property; TIF may not bc the answer. Technically the
HRA owns the property; however, previous I-lRA commissioners authorized the Council
to manage and benefit from the property. Market rate affordable townhouses.
10.
Committee Reports:
MCP - Steve Andrews: Nothing to report
MCC - Bob Murray: Things are going very well.
Marketing is meeting this Friday per Koropchak; she also noted she had been to Big Lake
earlier that day and they had asked for insight regarding downtown redevelopment.
11. Othcr Business. None
12. Adiournment.
A MOTION WAS MADE BY STEVE ANDREWS AND SECONDED BY HOB
MURRA Y TO ADJOURN THAT MEETING AT 8 PM. Motion carried unanimously.
9~if~_
HRA Chair
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