HRA Minutes 09-05-2001
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MINUTES
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
Wednesday, September 5,2001 - 7:00 p.m.
505 Walnut Street - Bridge Room
Members Present:
Chair Dan Frie, Vice Chair Brad Barger and Darrin Lahr
Members Absent:
Steve Andrews. Bob Murray and Council Liaison Brian Stumpf
Staff Present:
Rick Wolfstellcr, Ollie Koropehak and Lori Kraemer.
Guests:
Paul Steinmen and Jerry Shannon. Springsted, Inc.
Mike Cyr, MLC Building and Remodeling
I. Call to Order.
Chair Frie called the meeting to order at 7 PM.
2.
Consideration to approve the July 11, 200 I and August 1. 200 I BRA minutes.
A MOTION WAS MADE BY BRAD BARGER AND SECONDED BY DAN FRIE TC)
APPROVE TilE MINlfl'ES OF THE JULY 11, 2001 AND AUGUST I, 2001 HRA
MEETINGS. Motion carried.
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Consideration of adding or removing items from the agenda. None.
4.
Consent Agenda. None.
5.
Consideration to hear a presentation by public finance advisors, Springsted. Inc.
Ollie Koropchak, Executive Director, advised that representatives from Sprinsted, Inc.
were in attendance to provide a brief presentation to the HRA rnembers regarding their
company. Paul Steinmen and Jerry Shannon introduced themselves and re-hlmiliarized
the members with their company who previously worked with the City of Monticello as
financial advisors. They noted there are four people in their company who specialize in
housing and economic development, and that Jerry works in the financial end of their
company. Steinmen noted that they are a multi-faceted firm specializing in public
finance and that they are known for their specialty in bond issuance.
Steinmen added that some of the surrounding communities they work with included
Albertville, S1. Cloud. Maple Grove, Corcoran and 81. Michael, as well as a number of
school districts in the area and the Monticello - Big Lake Hospital.
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HRA Minutes - 09/05/01
Thc members asked tl)r an approximate fee to cstablish a TIF district and Steinmen stated
that it would depend on the level of involvement but that it could be anywhere from
$2,500 to $4,000 stating that they deal with these on a project by project basis.
One ofthcir primary assets that set them apart from the City's current advisor is that they
are independent and do no work for private developers. Also noted was their public
sector experience. Steinmen noted that he typically runs the numbers on projects, but
added that thcy have 65 people in their St Paul oflice who could run numbers as well.
Also noted was that they get paid by the project and they bill on a not-to-exceed basis.
The mernbers asked the average time frame fC)f a new TIF district to be created and it was
stated they take approximately 45 days, adding that they could be done in 30 days
depending on the timing in regard to notification dates.
6.
Consideration to approve preliminarv concept of use of TI F for development of 30 units
of twin hon1es.
Koropchak providcd the report stating Cyr informed the commissioners of his interest to
develop approximately 2.5 to 3 acres of land in the vicinity to the south of 6 Street and
Vine St. He asked the HRA of their interest in the concept and for TIF assistance in the
amount of $1 00,000.
It was suggested by the liRA to check if the proposed scattered housing TIF District and
Cyr" s projeet could be combined as one TIF District and Koropchak stated that (i'om a
TIF standpoint it could work as long as the 95% criteria is met; however. till1ing may be
an issue. The second round of awards for MHF A funding is scheduled f()l' September 27
and if awarded, thereafter will Sheri begin the process of acquiring parcels. The scattcred
housing project was planned with a difTerent huilder than Cyr but could still work.
Koropchak also stated that it appears developers approach the lIRA for interest o1'TlF
and request assistance without completion of an application and having talked to their
lenders, no sketch plan of the proposed development is submitted either. I n this case,
Koropchak added that she has yet to see a map of the proposed boundaries nor reccived a
completed application. Although thc liRA wants to encourage development/
rcdevelopment, she suggested the commissioners remind developers to complete the
preliminary application f()rm prior to appearing at an HRA meeting. Also the concept
gocs to the City Council prior to detcrmining a level of'I'IF assistance.
Cyr provided a brief description of his proposal stating that there are 2 12 acres owned by
Ron Ruff that he is interested in acquiring as well. Cyr asked if the board would fund the
project if he were to only develop Lots 8, 9 and 10, and either all or part of the proposed
vacated street. Lots 6 and 7 are owned by one person and are for sale. Lot 8 is owned by
thc Grups, who were in attendance as well, and Cyr has a purchase agreement with them
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HRA Minutes - 09105/01
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which he stated he needed to act on within the next 30 days. Cyr's request is f()l' up to
$1 OO,()OO for purchase and demolition, and his proposal is to build (1 to 8 units of twin
homes in four structures.
Cyr then proposed a larger project stating an owner of some parcels in that area is willing
to sell as well. Cyr is to arrive at a purchase amount. If this worked, based on the square
footage, Lots 1-5 along with the aforementioned lots would have enough square f()otage
to allow tl)!, a PUD tl)r 20 to 22 dwellings. If the City would vacate their street right-of-
ways ancI a triangular seetion as well. along with the square fl)otage stated, this would
support up to 36 market rate units of 1300 to 1400 sq. n. with basements at a selling price
of $159,900 to $169,900.
The members questioned how this density worked within that area and it was stated that
the area is in the PZM distriet. Rick Wolfsteller stated it was very likely the City would
choose to vacate those streets as they do not lead anywhere and there are probably no
utilities in place, or the need f(w any to be placed there.
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hie stated he liked the concept of replacing older housing with newer and higher density.
Koropchak again noted that she had not yet reeeived an application or fee from Cyr. Frie
also stated that he feels it is harcI flw the liRA to make a decision without that information
and Koropchak added they really need to know the number of units. Cyr asked if he were
to state he needed $100,000 to make this project work, and the lIRA could provide only
$60,000, where then would the shortfall corne fron1.
Lahr states he feels the HRA is intercsted but they do need to see some nWllbers. As fln
the shortL11L the City could possibly vacate the street. Koropchak states the application
nceds to be submitted, then if the Council approves, they would enter into a private
redevelopment contract and Cyr woulcI need to pay $5,000. The HRA likes the concept
hut cannot commit to a dollar amount. Cyr asked f()r a letter of intent that they would
approve the funding if the numbers worked. Koropchak noted that the motion stated
much the same without a dollar amount. Frie stated that the other key would be if the
Council would approve to vacate. It was clarified that Cyr is asking fl)r the City to vacate
the street in lieu ofa portion of'f'IF assistance.
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A MOTION WAS MADE BY DARRIN LAHR AND SECONDED BY BRAD
BARGER TO APPROVE TilE PRELIMINARY CONCEPT FOR ESTABLISHMENT
OF A HOUSING TIF DISTRICT WITll THE FINDING TIIAT THIS IS A UNIQUE
REQUEST IN THAT THERE IS CURRENTLY A HOUSE IN PLACE TIIAT WOULD
NEUJ TO BE PURCIIASED AND DEMOLISHED; FORWARDING THE CONCEPT
TO THE COUNCIL FOR APPROVAL; AND SUBJECT TO COUNCIL APPROVAL,
AUTHORIZATION TO ENTER INTO A PRELIMINARY DEVELOPMENT
AGREEMENT. Motion carried unanimously.
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II RA M il1l1tes - 09/05/0 I
6.
Consideration to award request flH' proDosal to cleanup the area along Front Street.
Koropchak advised that at a previous HRA meeting the I IRA authorized going out for
bids J()I' demolition and cleanup of the Bostic, Schlief and Reed properties. However,
after a lneeting with I lans Hagen, it was decided to wait until the lIRA gained possession
of the O'Connor parcel. Completing the cleanup as one project appeared to save money
in the long run and would provide a llnished pad site at a pre-determined grade level and
at 100% compaction. This is to be adjusted in the land price to Hagen. Koropchak added
that after the "test burn" and with the Building Department issuing hlight notices, the
Building Department received cOlnplaints of the remaining concrete IClLlI1dation and
garages in the said area and theret()IT the decision to solicit RFP's.
The RFP's were mailed to Schluender, Gulling and Fyle and were due back at noon on
September 4,2001 with work to be completed no later than September 2 L 2001.
Koropchak noted that only one bid was returned, that heing from Fyle and asked the HRA
if they preferred to resubmit or award to Fyle.
Lahr asked if the HRA could reject and start over. The members suggested that possihly
Fred Patch could state that on a certain date in October, all properties would be cleaned
up including the O'Connor property which the City will then have possession of. Lahr
stated that he is still concerned that Hans Hagen will want something other than what the
liRA plans for the properties. Dan Frie stated that the lIRA should demolish the
properties in October and then resume talks with I lagen over the winter months to
determine exactly what Hagen is expecting.
A MOTION WAS MADE BY BRAD BARGER AND SECONDED BY DARRIN
LAHR TO REJECT THE SOLE BID AND FOLLOWING THE CLOSING ON THE
CYCONNOR PROPERTY ON OCTOBER 3, 2001, RESEND RFP'S ON ENTIRE SITE
AS A CLEAN SITE. Motion carried unanimously.
7. Consideration of an update on projects within TIF District No. 1-22.
Koropchak providcd an update on the projects within TIF District No. 1-22, adding that
regarding the Amoco Site, Mr. Bjorklund was in to City Ilall earlier that day rcgarding
assessmcnts and stated Barry Fluth was ready to move forward on the project.
8. Consideration of authorizinl! payment of monthly HRA hills.
A MOTION WAS MADE BY BRAD BARGER AND SECONDED HY DARRIN
LAI IR TO AUTI IORIZE PAYMENT OF THE MONTHL Y liRA BILLS. Motion
carried unanimously.
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HRA Minutes - 09/05/01
9.
Consideration of Exeeutive Director's Report.
Koropchak provided the report adding that regarding Fay-Mar, the company is in default
with no produetion left. and also asked the members if they wished for her to question
Mr. Musich regarding the number of jobs from January of 200 1 to August of 2001. They
agreed to not ask for accountability of the jobs. Koropchak also added that the plan to re-
instate the business retention/expansion visits through the IDC would begin in October.
Also regarding a recent diseussion Koropchak had with a land owner in Monticello, she
asked the members how they would feel about providing TIF to relocate a warehouse
business to the industrial park. She added this would not be creating any new jobs. The
members stated they did not have enough information to make a decision at this time.
10. Committee Reports:
Marketing ~ Barger reported that the marketing committee had reviewed the main
brochure and there is a need to update it for more eurrent information. Xcel Energy will
contribute approximately one half of the cost to update. Lahr stated this would be
approximately $4,000. Total cost to update and print is approximately $14,000.
A MOTION WAS MADE BY BRAD BARGER AND SECONDED BY OARRIN
LAHR TO ACCEPT THE MARKETING COMMITTEE REPORT TO UPDATE
BROCHURES WITH XCEL CONTRIBUTING A PORTION OF $4,000. Motion
carried unanimously.
11.
Other Business. None
12.
Adjournment.
A MOTION WAS MADE BY DARRIN LAHRAND SECONDED BY BRAD
BARGER TO ADJOURN THE MEETING AT 9: 15 PM. Motion carried unanimously.
CJJqJ lffL'
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HRA Chair
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