HRA Minutes 04-20-1984y� SPECIAL MEETING
i� MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
Friday, April 20, 1984 - 7;30 A.M.
Monticello City Hall
Members Present: Jack Wove, Don Cochran, Vic Vokaty, Rud Schrupp,
and Gary wieber.
Staff Members Present; Toon Eidem and Allen Pelvit.
Chairman Cochran opened the special meeting.
Tom Eidem explained the reason for this special meeting was due to
the Modification of Tax Increment Finance District (T.I.F.) #1 for
IXI. He further explained the existing T.I.F. District #1 boundaries
and the proposed T.I.F. District #4. He then explained that the
northerly 175 ft. of the east 4 of Lai 7, Block 3, Oakwood Industrial
Park would be combined with all of the west � of Lot 7, Block 3,
Oakwood Industrial Park.
The reason for combining the north 175 ft. of T.Z.F. #1 with the
west 5 of Lot 7 is to allow all of the proposed new building to be
fully assessed in T.I.F. #4. The Auditor cannot take a percentage
of the building and assign values to each respective T.I.F. District.
CChairman Cochran asked if the land in question, both T.I.F. #1 and
T.I.F. #4, was one lot. Bud Schrupp asked if switching this property
would decrease the values or revenues for T.I.F. District 01. Eidom
explained that the amount would be reduced nominally because of the
reduction in square footage. However, any surplus from T.I.F. 04
can be applied lack to T.I.F. #1. It can also be applied to the
land bank for retiring the debt on Lots 5 and 6.
Bud Schrupp asked if IXI was only purchasing the west 5 of Lot 7.
Tom Eidem confirmed that and added that IXI will probably purchase
Lot 6 without T.I.F. This would be due to Lot 6 being utilized
mainly for parking and not generating much in taxes. The HRA has
the land to sell and can sell it any way it wants.
Jack Reeve asked when they planned to begin their construction. Ton
Eidem explained that we already had an agreement with IXI allowing
them to burm their property plus the boundaries of Lots 5 and 6.
it is the staff's view that if by chance IXI starts any work on the
new project while moving earth for burming, it would be okay. our
contract states that if they don't complete their part of the plan,
then the site must be restored to its original state.
Tom stated that IXI wanted to begin construction on April 1 but were
unaware that we have bureaucratic hoops to jump through. They thought
thAt.. All they had to do was come in with their plans, get a building
( permit, purchase the land, and begin construction. They have been
patient with the staff. Tom further stated that if they wete building
their bums and setting elevations, etc., at the same time, the staff
would not come out and shut down the job.
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Tom explained that because you cannot adopt a District that's
already in a District, the attorneys suggested the Modification
to T.I.F. District ill. Holmes and Graven neglected to send this
resolution along with the T.I.c. Plan for District q4. Technically,
this needs HRA action before the Council can act.
Chairman Cochran asked for any further discussion. There being
none, he asked for a motion to approve the resolution to modify
T.I.F. Economic Development District N1. The motion was made by
Bud Schrupp and seconded by Gary Wieber. Passed 5-0.
Tom stated that the Development Agreement, which was prepared by
Holmes and Graven, is quite lengthy (18 pages). Staff will meet
with Dee Johnson and go over the Agreement in detail making sure
all is understood. Tuesday, April 24, 1984, at 6:30 P.M., is the
public Fearing for sale and disposition of public lands. The
Authority does not need to attend. This can be an administrative
hearing.
Tom suggested that if everyone is in agreement that the property
should be sold, it would be beneficial to get a motion authorizing
the sale of the land contingent upon the entering of the development
agreement by IXI and there being no opposition at the public hearing
_ to the sale. This would allow staff to transact the business without
Cthe Authority having to call another special meeting.
Don Cochran asked what is contained in a development agreement. Tom
Eidem explained that it is a guarantee to build, to generate so much
revenue, jobs, taxes, etc. lie further stated that Wednesday morning
would formally be the first we could sell the property.
Don asked what took place at and who will attend the public hearing.
Tom Eidem stated that anybody may attend, that the Administrator will
conduct the hearing and will only listen to those, if any, who object
to the sale of land to IXI.
Chairman Cochran asked if there was any further discussion or questions
regarding the motion. Jack Reeve asked if there was any opposition,
other than Francis Klein's letter in the newspaper 15 years ago, to this
project. Tam stated that there was not.
Chairman Cochran asked for a motion to have the HRA authorize the sale
of land to IXI contingent upon IXI entering into the development agree-
ment and there being no public opposition to the sale at the hearing.
Motion was made by Jack Reeve and seconded by Gary Wieber. Passed 5-0.
Tom then asked if the Authority would mind moving their regularly
scheduled May 2, 1984, meeting to May 7, 1984. This has to do with
Fulfillment Sy6tt:ms, inc. iiol). FIw,%:ay, Aprll 23, 1984, the Council
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will authorize the sale of the bonds for FSI. Technically they
should not do that until they have the development agreement already
signed. Otherwise, FSI could back out and we're holding $130,000
in bond proceeds with no place to go with it. FSI is cammiitted,
but the possibility is there. They can't sign the developers agree-
ment without the public hearing on the sale or disposition of public
lands, which is scheduled for May 7. This was an oversight by the
staff. This will become a part of the May 7 meeting. The public
hearing will be first on the agenda. Allen will prepare the public
notice and place it in the April 26, 1984, addition of the Monticello
Times.
Tom stated that FSI's attorney has already approved the developers
agreement and will be asked to sign. That means they are committed.
We will not sign until we have jud through our own hoops. Another
item that will come up at the May 7 meeting is the pledge agreement.
That is, the City selling the bonds and turning them over to the
Authority. The Authority promises to pay them back.
Gary Wieber questioned the purpose of the development agreement. Tom
Eidem explained that there are minimum amounts and values that have
to be complied with contractually.
Allen Pelvit added that corrections have been made to both the Tax
Increment Finance District #4 and the Modification of Tax Increment
Finance District #1. Errors in measurements were made by Holmes and
Graven. Distances of both 180 ft. and 165 ft. should be changed to
175 ft. to allow the new 60' x 220' building to be fully assessed
in Tax Increment Finance District N4. Tom further explained that
this error was made by Holmes and Graven when measuring from a map.
Also he pointed out a section of boilerplate terminology taken from
their word processor that was incorrect. Allen added that Item E of
Page 2, Classification of the Tax Increment Financing District, explained
that IXI is a mail clearing facility. This will be corrected on the
master plan.
Chairman Cochran asked if any Authority members have had the opportunity
to visit with these firms in question. Jack Reeve answered by saying
he did not have the opportunity. Allen added that during the last
18 months IXI has been very secretive about what information they
give out. As of late the staff's relationship has become such that
they will allow a tour for our various committee members if we schedule
it with them. He then suggested arranging future tours for both IXI
and FSI.
Bud Schrupp asked about Joe Poehler's project and where it stood.
Tom Eidem explained that because of new philosophies in the St. Paul
FmHA Office the guidelines for elderly housing have been changed so
that trey discourage oldcrly housing in the d :..-.,-.. arcao. Poahler
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is currently looking at another piece of property that wouldn't
involve the HRA and will still proceed with an elderly housing
project.
Discussion took plata regarding Lots 13, 14, and 15, Block 51, and
possible direction the Authority could pursue in developing/re-
developing this area. In short, the Authority asked staff to
develop some sites and numbers for redevelopment of this block and
return to the next PIRA meeting with possible proposals.
There being no further business, the meeting was adjourned.
len L. elvi
Director of Economic Development
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