HRA Minutes 02-01-1989MINUTES
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
Wednesday, February 1, 1989 - 7:OOPM
City Hall
MEMBERS PRESENT: Chairperson Al Larson, Lovell Schrupp, Ben
Smith, Everette Ellison, and Tom St. Hilaire.
STAFF MEMBERS PRESENT: Rick Wolfsteller, Jeff O'Neill and HRA
Director 011ie Koropchak.
1. CALL TO ORDER.
Acting Chairperson Al Larson called the HRA meeting to order
at 7:05PM.
2. APPROVAL OF THE JANUARY 3, 1989 AND JANUARY 17, 1989 HRA MINUTES.
Ben Smith made a motion to approve the January 3 and January 17,
1989 HRA minutes, seconded by Everette Ellison, and with no
further discussion the minutes stand approved as written by
a 4-0 vote.
3. PUBLIC HEARING FOR THE DISPOSITION OF LANDS TO BROADWAY SQUARE
% LIMITED PARTNERS.
Acting Chairperson Al Larson opened the public hearing to allow
Interested persons to submit oral nr written comment for the
transfer of raw lands from the HRA to developer, Broadway Square
Limited Partners, raw lands described as
Lot 1 exc Nly 30 ft, Block 51
Lot 2 exc Nly 30 ft 6 Lot 3 exc Nly 30 ft of W 24 ft 6
W 7 1/2 ft of Lot 4, Block 51
Nly 30 ft of Lots 1 b 2 b Nly 30 ft of W 24 ft of Lot 3.
Also S 15 ft of Lot 15, Block 51
E 25 1/2 of Lot 4 d W 5 1/2 ft Lot 5, Block 51
Lot 5, Block 51, exc W 5 1/2 ft (50Mis-92) Original Plat.
for the sum of Fifty-six Thousand Dollars (;56,000). With no
public comment the public hearing was closed and the Acting
Chairperson called for a motion. Lovell Schrupp made a motion
that the HRA approve a resolution authorizing the tranfer of c
the above described raw lands to the developers, Broadway
Square Limited Partners, with the condition that a Development
Agreement is developed and signed by the developers and the
HRA prior to tranfer. Land cost tranfer is $56,000. Seconded
by Ben Smith and further discussion included the possible
funding of the project through the NRA excess funds created
by the refinancing of tax increment bonds if no development
HRA Minutes - 2(1189
3. CONTINUED.
agreement is signed. No purchase deadline date was established
between the NRA and the developer. With no additional discussion
the motion passed 5-0 meeting the NRA original objectives of
the project: 1) Provide opportunities for development and
expansion of new busineass; 2) Provide opportunities for growth
of the tax base; 3) Eliminate blight or deterioration within
an area; 4) Create a use of ucrrently under-utilized land; and
5) Provide needed subsidized elderly housing.
4. PUBLIC HEARING FOR THE AC4UISITI0N AND DISPOSITION OF LAND
FOR TAX INCREMENT DISTRICT NO. 1-8.
Acting Chairperson Larson opened the public hearing to allow
interested persons to submit oral or written comment for the
acquisition of raw lands from the City of Monticello to the
HNA and the disposition of raw lands from the HRA to developer,
Northern States Power Company. Raw lands described as
Westerly 3.22 acres of Lot 4, Block 3, Oakwood Industrial
Park, City of Monticello, Wright County.
With no public comment the public hearing was closed and the
Acting Chairperson called for a motion. Ben Smith made a
motion that the HRA approve a resolution authorizing the transfer
of above described raw lands from the City of Monticello to
the HRA for the sum total of $21,200 and from the HRA to the
developer for the sum total of $1.00 with the condition that
a Development Agreement is developed and signed by the developers
and the NRA prior to transfer. Seconded by Everette Ellison
and with no further discussion the motion carried unanimously
meeting the public interest: 1) It will discourage commerce,
Industry, or manufacturing from moving their operations to
another state; or 2) It will result in increased employment
in the municipality; or 3) it will result in preservation and
enhancement of the tax base of the municipality.
5. CONSIDERATION TO REVIEW THE RESERVE FUND CREATED BY COMBINATION
OF THE DISTRICT TIF PLANS AND".OR BY RELINOUISHING THE PLEDGE
AGREEMENTS, AND TO REVIEW THE POTENTIAL REFINANCING OF TAX
DISTRICT GENERAL OBLIGATION BONDS.
Mr. Pat Pelstring summarized the benefits of refunding bonds
to the HRA member: 1) Reduce Debt Service; 2) Improve Cash
Flow; 3) Free Up Excess Increment; 4) Repay General Fund
Loans and Reduce General Fund Exposure; 5) Simplification
and Administrative Efficiency; 6) Provide Necessary Financing
for District No. 2, Proposed NSP Project and Future Projects
More Efficiently. Refunding Bond Sources are bond sale,
$1.2 million and Pledge Agreement, approximately $128 thousand.
f Refunding Bond Uses are pay off of TIF City Loan #1, $20 thousand;
Acting Chairperson Al Larson requested the HRA set policies/
guidelines for the use of TIF to assist the members with
who should be granted the use of TIF (NSP, Construction Five,
Martie Farm Service). Mr. Pelstring advised the HRA that
an application form could be developed for preliminary screening.
Roropchak informed the HRA members that we have such a form
however city staff is somewhat negligent'wlth it's use.
Pelstring briefly explained a process used in Woodbury. The
use of TIF for industrial Is the most liberal because it's
most competitive (if possible fund 13-18% of the project cost);
commerical write down to market value and remaining balance is
a loan, housing for the benefit of the people moving in (public
benefit) request proforma analysis with the use of TIF and
without the use of TIF. Use TIF for public improvements such
as roadways on projects that are marginal. Commerical/retail
use with public purpose of elimination of blight. The NRA
has the authority to bulldabuilding but not with the use of
TIF. Mr. Pelstring will develop and present a preliminary
draft of guidelines/policies for the HRA at the March meeting.
HRA Minutes - 2/1/89
(
Loan 02, $24 thousand; Loan 04. $100 thousand; refunds from
TIF 03 bonds, $113 thousand; Bond 05, $364 thousand; Bond 06,
$357 thousand; monies available for proposed Districts 02 and
08. $300 thousand; issuance cost, $25 thousand; Underwriter's
Discount, $24 thousand; contingency $3 thousand.
The cash fund use becomes a public policy decision to have
excess monies. Return to the county, school, or hospital
districts or reserve funds used for city projects such as
elimination of blight. The excess $300 thousand is a savings
on capitialized interest, need for no interest loans, and the
availablity of monies for small projects.
City Administrator Rick Wolfsteller stated that refunding bonds
would simplify payments, the projected interest rate and the
Issuance cost are a wash, terms match, bond market cost are
positive for this year anyway, and provides flexibility for
the HRA.
Lovell Schrupp made a motion directing City Staff to proceed
with the necessary steps for the relinquishing the Pledge
Agreements and refinancing the District General Obligation
Bonds inclusive of a recommendation to the City Council for
approval. Seconded by Tom St. Hilaire, the HRA Was informed
the City Council would need to hold a public hearing for the
bond sale. With no further discussion the motion passed 5-0.
L
Dougherty Dawkins fees are contingent upon bond sale only.
6. CONSIDERATION TO REVTF.W POT,TCTF.S/GUIDELINES FOR THE USE OF TIP.
Acting Chairperson Al Larson requested the HRA set policies/
guidelines for the use of TIF to assist the members with
who should be granted the use of TIF (NSP, Construction Five,
Martie Farm Service). Mr. Pelstring advised the HRA that
an application form could be developed for preliminary screening.
Roropchak informed the HRA members that we have such a form
however city staff is somewhat negligent'wlth it's use.
Pelstring briefly explained a process used in Woodbury. The
use of TIF for industrial Is the most liberal because it's
most competitive (if possible fund 13-18% of the project cost);
commerical write down to market value and remaining balance is
a loan, housing for the benefit of the people moving in (public
benefit) request proforma analysis with the use of TIF and
without the use of TIF. Use TIF for public improvements such
as roadways on projects that are marginal. Commerical/retail
use with public purpose of elimination of blight. The NRA
has the authority to bulldabuilding but not with the use of
TIF. Mr. Pelstring will develop and present a preliminary
draft of guidelines/policies for the HRA at the March meeting.
HRA Minutes - 2/1/89
( 7. CONSIDERATION TO DISCUSS POTENTIAL DEVELOPERS FOR QUALITY
ELDERLY HOUSING.
Mr. Pelstring informed the HRA that he knew of two potential
developers who are interested in the concept of providing
quality elderly housing as stated in the NRA goals. They
have participated In similar projects. Ben Smith and Jeff
O'Neill will identify areas within Monticello as potential
sites by the next HRA meeting and Mr. Pelstring will
invite the two developers to the HRA meeting.
8. CONSIDERATION TO ELECT THE HRA CHAIRPERSON AND VICE CHAIRPERSON.
Ben Smith made a motion to appoint Al Larson as the HRA Chairperson
for the remaining of his term, seconded by Everette Ellison the
motion carried 4-1. Al Larson abstained. Lovell Schrupp made
a motion to appoint Ben Smith as the HRA Vice Chairperson for
a one year term, seconded by Everette Ellison the motion carried
4-1. Ben Smith abstained.
9. CONSIDERATION TO APPROVE RECOMMENDED 1989 HRA GOALS.
The HRA members reviewed the 1989 HRA Goals as recommended
by Al Larson, Jeff O'Neill, and Koropchak. Chairperson
Larson suggested his preference to use the word (blight in
C place of slum) under Item C. With no further corrections
or discussion Lovell Schrupp made a motion to accept the
1989 HRA Goals as presented and with the correction as
stated by Chairperson Larson. Ben Smith seconded the
motion which passed 5-0.
10. CONSIDERATION OF AN UPDATE TO TIF DISTRICT /5, CONSTRUCTION FIVE.
At the City Council meeting, Koropchak requested the authorization
for a feasibility study for the installation of the storm sever
along the easterly boundary of Outlot A and Lauring Lane.
John Simola still In opposition of the Outlot A storm sewer
installation suggested the City Staff meet with Construction
Five to determine adequate parking spaces wherebye the
potential to reduce the length of the storm sever installation.
A meeting date between city staff and Construction F.iveohas been
set. City Council received Gus LaFromboise list of reasons
by to use TIF for this project.
11. OTHER BUSINESS.
None.
12. ADJOURNMENT.
Everette Ellison made a motion to adjourn, seconded by Lowell
Schrupp, the HRA meeting adjourned.
011ie Koropchak, HRA Executive Secretary