HRA Agenda 02-06-1986MINUTES
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
Thursday, December 5, 1985 - 7:OOPM
Members Present: Bud Schrupp, Ken Maus, Roger Hedtke, and Ben Smith.
Members Absent: Chair Gary Wieber.
Assisting as Staff Representative: Tom Eidem, City Administrator.
1. Call to Order.
Acting Chairperson Bud Schrupp called the HRA meeting to order
at 7:05PM.
2. Approval of Minutes.
Ken Maus moved to approve the Thursday, November 7, 1985, Regular
HRA Meeting Minutes, Seconded by Ben Smith, and carried un-
animously.
3. Approval of Minutes.
Ben Smith moved to approve the Tuesday, November 12, 1985, Special
HRA Meeting Minutes. Seconded by Roger Hedtke, and carried un-
animously.
4. BerRstad Properties Report.
After clarification that the Borgstad Property and the proposed
Tax Increment District 07, were one in the same, the Authority
accepted the report, recognising the Public Hearing on Establishing
Tax Increment District 47 was cancelled by the City Coucnil,
November 25, 1985. Mr. Bergstad had proposed to rehabilitate the
present Nursing Homo.
5. Olson Property Appraisals.
The Clifford Olson property is Block 16, Lot 10, City of Monticello.
The HRA discussed the comparable appraisals: AmoricInn site, $3.00
per square foot; Security Federal site. $2.75 per square foot;
First National site, $2.43 per square foot; and Roindance Properties,
$2.75 per square foot. The Authority address the statue of the
adjoining property, Block 16. Lot 9, City of Monticello, owners
being William and Noll Jongowaard.
Tom Eidem suggested the HRA obtain the city's appraisal firm in
St. Cloud to appraise both Lots (9and 10) as one, then determine
finance, and present an offer to Clifford Olson. Appraisal cost
estimate, $750-$850. Mr. Olson's offer was $110,000.00. A con-
cern by the Authority was If the HRA actually wants or needs the
property, to varrent such conics. Possibility of a purchase
agreement or option agreement may serve for the Jongewaard
property. Oliva Koropchak related of two parites with possible
interest in the said properties. One, three man from St. Cloud
HRA Minutes - 12/5/85
interested in the site for a fast-food restuarant. Second,
an appraisal consultant appraising both properties.
Concensus of the Authority was to have Olive Koropchak contact
Clifford Olson. Discussion with Mr. Olson to center around
the HRA's feeling that Mr. Olson's offer of $110,000 for Lot 10
of Block 16, is out of line. The possibility of improved housing
at the Jongewaard property would decease Mr. Olson's property
value, also the type of construction, such as a fast-food restaurant
may not coincide with the City's Zoning Ordinance. Property size
also being small for many types of commerical business may devalue the
property. Would Mr. Olson like to have the property appraised or
Mr. Olson and HRA have appraisals done?
6. Consideration of a Resolution Authorizing the Execution of a Tax
Increment Pledge Agreement - Raindance Properties.
Tom Eidem gave a brief explanation about the HRA and City Council
Pledge Agreement, also stating that the HEA has no legal authority
to issue bonds, therefore, the City Council must issue the bonds.
The Pledge Agreement states the revenue acquired by the HRA
through the Tax Increment Finance District, be pledged to the
City Council to retire bond debts.
Ben Smith moved to adopt the Resolution Authorizing the Execution of
a Tax Increment Pledge Agreement, seconded by Roger Hedtke. Passed
3-0. Ken Maus abstention due to personal interest.
7. Other Business.
The City Administrator briefed the Authority on the Stolp's
property on West Broadway adjoining the Monticello Post Office.
The Poet Office may be interested is leasing the property if
City owned, or purchasing the property from Stolpe for postal
expansion. Olive Koropchak is to check if payment has been
received from Metcalf/Larson on the HRA Optional Agreement extension.
Also. Koropchak will present a HRA financial report to the Authority
at the next meeting.
8. Adjournment.
Bon Smith moved to adjourn, seconded by Ken Maus, passed unanimously.
Keating adjourned. n
�Qwz• 1,� • 7y
Executive Secretary,
Monticello Housing and Redevelopment Authority
NRA Agenda — 2/6/86
3. EVALUATION OF THE FINANCIAL STATEMENTS.
A. REFERENCE AND BACKGROUND.
In your January informational package you received a copy of
the RRA Financial Statements. I recommend you bring those
copies to the meeting for discussion. I will ask Tom Eldem,
City Administrator or Rick Wolfsteller, Finance Director, to
attend the meeting for clarifications.
No alternative actions, staff recommendations, or supporting
data.
HRA Agenda - 2/6/86
4. CONSIDERATION OF SETTING 1986 HRA GOALS OR OBJECTIVES.
A. REFERENCE AND BACKGROUND.
Sometime ago, Gary Wieber suggested the HRA set goals and I
agree. Gary Wieber will not be at our meeting Thursday evening,
however, he suggested the HRA consider a study on the need
for additional housing for the low income or elderly of this
area. Secondly, as the Tax Lncrement Bonds and Industrial
Development Bonds are no longer tools for Monticello or
other Minnesota Cities to use as economic incentives for industrial
development. I suggest the time has arrived for the HRA to
consider a general direction for expenditures of the
revenues to be generated from the existing Tax Increment
Districts. I mean long range plane. I hope you will give
this some consideration before our meeting.
No alternative actions, staff recommendations, or supporting
data.
City o` Monticello
MONTICELLO, MN 553529245
December 27, 1985
Phone (612) 295-2711
Metro (612) 333.6739
Mayor.
Ave orknanw
C=
Fran Fak
WdU*m Fair
Jack Maxwell
Dear Monticello HRA Member:
ndn*ftt":
Tem Elomm
The Monticello Housing and Redevelopment Authority will
Fkktnes Director;not
meet Thursday, January 2, 1986, because no immediate
pk:k W0031e4er
adoption items appear on the agenda. The decision was
Public wane:
reached by a consensus among Cary wieber, HRA Chairperson;
John Seols
Tom Eidem, City Administrator; and myself. However.
C6ary aww4*:
included are three reports or inquiries requested by the
HRA at the December 5, 1985 meeting. One, Clifford
Olson Property Estimated Selling Price. Second, HRA and
Metcalf/Larson Optional Agreement Extension. Third, a NRA
Financial Report. Also included is an update on Industrial
Activities in Monticello.
Our next Monticello HRA meeting 1s scheduled for Thursday,
February 6, 1986, 7:OOPM, Monticello City Hall.
Thank you for your cooperation and support during the year
and a Happy and Prosperous Nov Year.
Sincerely,
Olive M. Roropchak
Executive Secretary,
Monticello Housing and Redevelopment Authority
Enclosures
cct file
250 ERM 0ra4eway
MonticMe, Mkk10Wh
66362.6245
1. Clifford Olson Property -Estimated Selling Price.
At the request of the HRA, I contacted Clifford Olson
(1-872-7590) In efforts to speculate his intent to sell
or selling offer of Block 16, Lot 10, City of Monticello.
Our interaction commenced around neighborhood existing
properties, their positive and negative effects on his
property, their past and future plans, and past npfghhorhood
selling prices.
After our discussion, Mr. Olson still felt the ball was in
the hands of the BRA, also indicating he would not consider
a ;3.00 per square foot selling price; he also would not
consider any serious action of the HRS unless it was of
written form; and he would only consider a shared appraisal
cost of the property if the HRS purchased the property
and the coat would be written off in the purchase agreement.
Mr. Olson has not had the property appraised. Mr. Olson
felt the HRA should hire a Real Estate Broker who knows
the property's real value and make him an offer, this way
the BRA would know the property's worth and he would be
more inclined to listen. Mr. Olson indicated he has spoken
with the Jongewaard's son, a realtor, who may be interested
in selling the properties as a joint proposal. He is
interested in selling to a business whose profit is of
cash flow. Our conversation was of a positive and friendly
nature, ending with an agreement that I would contact
him if needed. I extended an invitation for Mr. Olson to
stop by the City Hall to visit personally.
2. The ARA and Metcalf/Larson Optional Agreement Extension
Report.
At the December 5, 1985 HRA meeting the Authority asked
for a followup on the Optional Agreement Extension between
the HRA and Metcalf/Larson. On November 7, 1985, the HRA
granted a 90 -day extension of Loan /84022 at the Wright
County State Bank and granted a 90 -day extension on the
Optional Agreement, expiration date December 19, 1985, if
needed. Monthly payments on the optional agreement are
$400.00.
On December 19, 1985, Gary Wieber, HRA Chairperson and Olive
Roropchak, HRA Executive Secretary signed an option extension
for 90 -days with Metcalf/Larson, expiration date March 19, 1986.
The City of Monticello having received a check dated December,
16, 1985, for $1,200.00 (See Supporting Data).
U0 vm a,YY]M. ..
The Option attached hereto dated June 19, 1984, and incorporated herein
as if set forth in full, having been assigned by Monticello Elderly Partners to
Metcalf & Larson, a Minnesota General Partnership, is hereby extended from
December 19, 1985 to March 19, 1986, upon payment of $1,200.00, receipt whereof
is aclmowledged, and all other terms of the Option remain in full force and effect,
except that if said Option is exercised before March 19, 1986, $400.00 per mond}
for each month remaining on the Option term shall be applied against the
price.
Dated: ;Z) -\Q,, . \ q, Q. S
HOUSING A REMMX)P=U AUIi37R11Y OF
ME CITY OF MONTTCEII
By }�Q...c_. \,<
Olive Koropchak `
E�cecut a Secretary
e
Cha f Monticello HRA
0,A,l n1ANHL JACOBSON_
WTAFN
my� EV "M
Subscribed and sworn to before me
thisJ�day of a,n 1. r, 1985.
Rotary PUNIC
Drafted by:
ME rCALF A LUSON
Attorneys at Law
P. 0. Bou 446, 313 West Broadway
Monticello, Minnesota 55387
O P T I O N
For and in consideration of the sum of TWO THOUSAND
FOUR HUNDRED ($2,400.00) DOLLARS, in hand paid to the HOUSING AND
REDEVELOPMENT AUTHORITY OF THE CITY OF MONTICELLO, the receipt wherec
is hereby acknowledged, said HOUSING AND REDEVELOPMENT AUTHORITY does
hereby grant unto MONTICELLO ELDERLY PARTNERS, a Partnership under
the laws of the State of Minnesota, consisting o1 JAMES G. METCALF,
BRADLEY V. LARSON and KENNETH BARTHEL, an exclusive option for a per-
iod of six (6) months from and after the date hereof, to purchase,
for the sum of SIXTY-TWO THOUSAND AND NO/100 ($62,000.00) DOLLARS,
the following described lands situated in the City of Monticello,
County o1 Wright, State o1 Minnesota, to -wit:
Lots 13, 14 and 15 of Block 51, the Townsite of
Monticello, according to the recorded Plat of Record,
less and except the south fifteen (15) feet of said
Lot 15,
upon the following terms and conditions:
That if this option is exercised, the said Authority
shall convey said premises free and clear of any liens
and encumbrances and shall furnish an Abstract of Title
continued to date, showing the same;
That all real estate taxes upon the premises due and pay-
able in the year 1984, if any, shall be paid by the Seller.
METCALF & L.ARSON nay exercise its option at any time during
the time above specified by providing written notice to
said Authority and failure to provide such notice within
the time specified, shall terminate this Option without
further action. Time being the essence of this Agreement.
In case such -Notice shall be provided within said time,
then thirty (30) days shall be given in which to examine
the Abstract, make deeds and close the sale.
If this option is exercised, the price paid for this Option
shall not be applied to the purchase price.
Dated this qday of June, 1984.. 8=114 A114 HOUEUVUENT ALT18 UT'
OF '11$ CITY
BY:
METCALF a!t CARSON9590
AlTORSMS AT LAM
AAYEe & WITCALP A eRADWY Y. LARSON
•
P'0'
ROX 44
NORnCELLO. Y "MOTA SS= 75.11lLn9
- Dec. 16 Ig 85
PAY
TO THR
!' ORoZROF CITY OF MONTICELLO 1 $ 1,200.00
1- I
' One Thousand Iwo Hundred and 00/100- - - - - - - - - - - - - - - - - - - - - -
-DOLLARS
WRIGHT COUNTY STATE BANK
• P.O. 0011 729.10121 285-2M
001MCIU0, MINNESOTA 55M
FOR Ootion Extension/EmRA Elderlv Aot. Prot.
O'009590A' -409L9LL5221: 100 500 600 ,
q1.
NOTES TO FINANCIAL STATEMENTS
Although the "General HRA Fund" has a Cash Balance of approximately
$61,700.00, the amount should not be considered entirely surplus funds.
The HRA has spent to date approximately $7,500.00 for professional services
associated with Key Tool and Construction 5 Tax Increment Proposals which
have not yet materialized and as a result, these cash deficits should be
deducted from General HRA surplus for the present time.
In addition, cash deficits have occurred in other TIF Districts, such as
IXI. It 1s projected that additional revenues in future years will
eliminate these deficits, but some of the present surplus of the HRA
should be retained to help pay interest costs, etc. until enough revenue
is generated by the Districts.
EXAMPLE:
District 14 (IXI 2nd Phase) has a cash deficit
$ 9,098.00
Interest due in '86 on Loan to City
2,940.00
Projected '86 Deficit
($12,038.00)
IXI 3rd Phase (Lots 5 6 6 — Oakwood) deficit
13,055.00
Interest due In '86 on Loans
12,384.00
Projected '86 Deficit
($25,439.00)
Total IXI Cash Deficits
($37,477.00)
Projected Tax Increments 186
24,259.00
Expected Deficit
($13,218.00)
For 1986, it is recommended that the HRA Fund retain $13,000.00 to cover
the IXI deficit and $7,500.00 to cover the Key Tool and Construction 5
deficits.
General HRA Cash
Lees:
Surplus available for other Uses
61,700.00
20,500.00
$41,200.00
District /2 (Motcalf/Larson), District 93 (FSI), and District 06 (Rafndance)
should have adequate cash balances to meet current expenditures. Also,
the proposed Elderly Housing Project by Metcalf/Larson on Block 51 should
eliminate the cash deficit on this project once the land to sold to them.
y
WN
IL
HRA (All Projects)
SUMMARY OF RECEIPTS 6 DISBURSEMENTS
YEAR THRU 12/30/85
Total Cash as of 1/1/85
RECEIPTS:
Retaxes - Advalorem
$ 35,603.56
Tax Increments - Diet. 01 b 2
6,024.35
Homestead Credit
1,418.90
Application 6 Option Fees
6,100.00
Payments in Lieu of Taxes - Dist.
01 2,520.84
Interest Income
-
Sale of Property - IXI 6 Veit
79,701.45
Bond Proceeds - Veit Project
345,595.49
Final UDAG Grant Payment
11,578.00
TOTAL RECEIPTS
DISBURSEMENTS:
Salaries
2,966.40
Fringe Benefits
335.22
Dues, Memberships
25.00
Legal Publication
21.61
Land Acquisition Costs
231,132.25
Loan Repayment to General Fund
2,967.16
Interest Expense
40,895.89
Professional Services Fees
6,448.85
Other
241.06
UDAG Grant Dleb. - PSI
3,393.00
Office Supples
19.75
TOTAL DISBURSEMENTS
TOTAL CASH 6 INVESTMENTS 12/30/85
$ 18,481.44
488,542.59
288,446.19
$218,577.84
ALL
TOTAL
272,267.73
2,346.75
e. Do
23st315.O0
510.437.15
at
(291.699.97)
5)7,000.00
239.3D0.03
5510,437.46
nA
6.1A392 SMT -ALL SROSLCTS 6 DISTSICTS
11/50/65
.SSM:
C—1
Di— I1
Di— 12
Dl.i. 03
DS.t. 44
US T..1
Dl—
9.St C.Wi.
lre9.rt3
IM 3rd
EPA
III
btc.1173ar.tm
MI
LU 2nd
Cvetc. S
(lnt. 546)
OMr+.fvu
ho9v..1
C.c1 4 1—
5 61.70[.79
30,712.95
179.349.99
deeau. Uc.l..tl.
2.616.75
h.p.0 lass.6.00
Lm T— L-1..11.
2]5.31).00
TOTAL LSSM
6:.712.79
k
2.346.75
266.027.95
-0-
-0-
-0-
179.619.99
-0-
-0-
L246T1-TTM:
C..1 D.Sit1i
2.601.40
9.096.22
1.620.22
3.920.0021
.Iu.lt
13,055.66
t. C 2 l,m/ - la¢a
Ss.696.a5
}6.)30.51
151. Sao. DD
TOM LLAZILITTM
-D-
25,!96.13
2,601.40
-0-
45,349.05
3.b2U.22
1.920.00
4—
21,294.99
167,655.66
OTD 641A=-'
LY....rw1
61.712.19
(23.M.13)
(31.7)1.65)
111.027.95
(IS.619.05)
(1,620.12)
(5.920.00)
(170.150.01)
(21,391.19)
(161.633.56)
Dnigm.ttd - 3.=" !.3.61.
)2,=.Do
115,000.W
750.000.00
SCIA1 /CD 41iFII3
61.%/7.1f
(25,69x.13)
215.)5
766,027.95
(45,349.0})
11,6/U.:/)
(3,920.00)
179.611.99
(21,394.49)
(167,655.56)
TOTAL LUITLTTIM 4 SLT�' .....r.
S 6;.712.79
-0-
f 2,5.6.75
$266,027.95
-0-
-0-
-p-
5179.349.99
-0-
ALL
TOTAL
272,267.73
2,346.75
e. Do
23st315.O0
510.437.15
at
(291.699.97)
5)7,000.00
239.3D0.03
5510,437.46
ttVO-T:
Ad Velar. rete•
Tas 1-rsaats
2:msted Credit
Applluti— Fees
tnt•rest I—axw
fele of rrapercy
Py— 6y Developer io Liea of Tates
TOM t azz
EXPMITCM
S.Lris.
PM. rzu
laeareate
Does. stub. hips
Lpl rublltatinas
Load AeQatslt La Costa
Interest I.re•ee
!cafe.. caul Services
TOTAL m®ITUM
reset. (defltlenty) of
a �
R-9 over rJPensss
Zrl.—tas feat.•
9 Fret.."
`--cm (MmclaCT) Or
50;4r�6 A UTQA rtp=l=
sant, I'm
BISIL77I= r= SALA= 111/85
E LSL ►6D BALANM 12/30/83
80TSIFC AFD tE0T9l3DMWT AUI80tITT
Det.e6.r 30. 1955
General Diet. I1 Dist. 12
1 I1, rm. if/ et...
33.603.54
5.991.10 33.25
1.418.90
2,866.75
17,022.46
5.991.10
2.860.00
2,966.40
SQTAL
Diet. 13
335.22
Dist. 15
25.00
81D6k 31
(Future)
21.61
FSI
2II 2nd
56.00
Cone;. 5
9611 Ctlnet.
Property
2.309.09
2.880.00
17.10
750.00
2.50
22.56
J,4t..tl1
I,J .YY
].652.56
33.598.63
3,682.01
(772.56)
-0-
-0-
-0-
33.598.63
1.682.01
(772.56)
28.114.67
(29.578.44)
1,017.91
r 61.113.30
(525.895.43)
1 243.13
SQTAL
Diet. 13
Dist. /4
Dist. 15
DLI. 16
81D6k 31
(Future)
(All Fro36Ctt
FSI
2II 2nd
GI Tool
Cone;. 5
9611 Ctlnet.
Property
III 3rd
6 Dle tr itt4
35.603.56
6,024.35
1.418.90
2.500.00
3.600.00
5.100.00
-0-
64,150.00
13.551.45
79,701.43
2.846.73
..0..
-0-
-0-
-0-
66,650.00
3,600.00
13.351.65
131,695.01
2,966.40
335.22
-a-
0-
25.00
25
21.61
231,076.25
231,132.25
13.632.76
2.940.07
4,404.51
4,549.97
12.384.00
43,300.40
101.50
25.00
3.920.00
1,235.25
6,048.85
30.00
84.00
139.06
1s.9J4. ze
z,YYs.u/
-u-
3.;26.6w
[36.600.01
4,549.97
12,384.00
285,968.79
(13.93A.26)
(2.995.07)
-0-
(3.920.00)
(170.150.01)
(949.97)
3,167.45
(154,273.78)
-0-
-0-
-0-
-0-
350,000.00
-0-
-0-
350.000.00
(15.93A.26)
(2,995.07)
-0-
(3.920.00)
179,869.99
(969.97)
3.167.45
195.726.22
261.962.21
(42.853.98)
(3.620.22)
-0-
-0-
(20.444.22)
(171.023.31)
43,574.62
{266,02/.Y3
(145,849.05)
(13,620.22)
($3,920.00)
1179,849.99
({21,394.19)
($167,855.86)
$239,300.84
"1 4. Industrial Development Activities.
Raindance Properties.
Raindance Properties proposes to construct a 33,000 square
foot building on Block 15, City of Monticello, leasing
25,000 square feet to Maus Foods and 8,000 square feet for
speculative use.
On December 9, 1985, the City Council adopted a resolution
awarding the sale of the $350,000.00 Tax Increment Bond
Issuance to Dain Bosworth, Inc., lowest of seven bids in the
amount of 8.2893% net interest rate (Resolution 1985 032).
The City Council also adopted a resolution entering into a
pledge agreement with the HRA (Resolution 033). On December
19,1985, the City Council adopted a resolution of final approval
for the issuance of $1,075,000.00 Industrial Revenue Bonds
for this project (Resolution 034).
On December 26, 1985, the transfer of land title from Wilbur
and Margaret Eck and the City of Monticello to the HRA tran-
spired; followed by title transfer to Raindance Properties.
At the end of year 1985, the Raindance Property Proposal
or Tax Increment District 06 will be completed with building
construction set for spring of 1986.
Pyro Industries, Inc.
Pyro Industries. Inc. manufactures Whitfield pellet -burning
stoves, and is currently located in the state of Washington.
Mr. Tim Carlson to interested in expnnding the facilities
to Monticello. Mr. Carlson is considering the Best -In -Webb
Building. City Staff has mot several times with Mr. Carlson
plus a special meeting with Economic Development Commissioner
Mark Dayton, Senator Betty Adkins, Representative Bob McEachern,
State Financial Consultant Dave Peterson, Tom Eldom, and
myself. Mr. Carlson also gave a presentation to our
Industrial Development Committee. His project qualifies for a
State Direct Business Loan and for a Minnesota Small Cities
Economic Development Grant. The City Staff has provided
answers, willingness, encouragement, and support to Pyro
Industries, Inc. At this time, City Staff awaits Mr.
Carlson's decision.
IF
1
Airport Sub -Committee.
The Industrial Development Committee has designated an Airport
Sub -Committee to research the feasibility of improvements at
our present airport location. The Sub -Committee, non-bondified,
has met with the MinnDot, Aeronautics Division. A planned
airport tour of Mora, New Ulm, and St. James is scheduled
for Tuesday, January 7, 1986. The objective of the tour
is informational: site ideas, funding, procedures, and pros
and cons. Jack Peach of Fulfillment Systems, Inc., also on
the Sub -Committee, has donated his plane, fuel, and pilot
for the tour. The Sub -Committee has representation from
Monticello. Big Lake, and Becker.
Metro Phone Service.
At the last ID Committee meeting Bob Rierson of Bridgewater
Telephone Company reported to the Committee that FX (Metro)
lines are available to Monticello, as many as a company
would want. Watts lines are also available, however, he
indicated they are not coat effective within a 80-100
mile radius. Mr. Rierson stated the Bridgewater Telephone
Company is willing to provide any service that a customer
wants providing they're willing to pay for it. He also
reported on the Big Lake and Zimmerman Metro EAS traffic
studies and indicated that Metro EAS would substantially
increase residential rates. Mr. Rierson expressed his feelings
that Metro EAS would not expand but decline, however, he also
advised the Committee if Zimmerman votes yes on Metro EAS
than Monticello should follow with necessary procedures for
Metro EAS.
Chamber of Commerce Banquet.
The Annual Chamber of Commerce Banquet will be hold Saturday.
January 18, 1986, at the River Inn-Cabarat. Guest speaker
will be Joe Sensor, retired Minnesota Viking. Cost: $25.00
per person.
Star City Recertification.
Monticello staff is working on State requirements for Star
City Recertification. A presentation, reviewed by Minnesota
Star City Rovtowal Committee to scheduled for March 12, 1986,
at the Monticello City Hall, with final written report duo
March 31, 1986.
11