HRA Minutes 04-02-1997
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MINUTES
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
Wednesday, April 2, 1997 - 7:00 p.m.
City Hall
MEMBERS PRESENT:
Vice Chairperson Brad Barger, Steve Andrews, Darrin Lahr, Bob
Murray, and Dan Frie.
COUNCIL LIAISON PRESENT: Roger Carlson.
STAFF PRESENT: Ollie Koropchak.
STAFF ABSENT: Rick Wolfsteller and Jeff O'NeilL
1. Call to order.
Vice Chairperson Barger called the HRA meeting to order at 7:00 p.m.
2.
Consideration to approve the March 5, 1997 HRA minutes.
Steve Andrews made a motion to approve the March 5, 1997 HRA minutes. Bob Murray
seconded the motion and with no corrections or additions, the minutes were approved as
written.
3.
Consideration of public comments.
None.
With discussion among HRA members relating to default ofthe Private Redevelopment
Contract between the HRA, City, and Cedrus Creek Craftsman, Inc.; Commissioner
Murray expressed the need to modifY the agenda format to include "additions to the
agenda". Bob Murray made a motion to modify the format of future HRA agendas to
include "additions to the agenda". Dan Frie seconded the motion and with no further
discussion, the motion passed unanimously.
The HRA continued discussion of the Cedrus Creek Redevelopment Contract under Item
7., consideration of project updates.
4. Consideration to elect HRA officers and appoint HRA representatives.
Dan Frie made a motion to nominate and elect Brad Barger as Chairperson ofthe HRA.
With no other nominations from the floor, nominations ceased. Darrin Lahr seconded the
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HRA MINUTES
APRIL 2, 1997
motion and with no further discussion, the motion passed 4-0-1. Yeas: Frie, Lahr,
Andrews, and Murray. Nays: None. Abstention: Barger. Barger abstained as nominee
for office.
Dan Frie made a motion to nominate and elect Steve Andrews as Vice Chairperson of the
HRA. With no other nominations from the floor, nominations ceased. Bob Murray
seconded the motion and with no further discussion, the motion passed 4-0-1. Yeas: Frie,
Murray, Barger, and Lahr. Nays: None. Abstention: Andrews. Andrews abstained as
nominee for the office.
Steve Andrews volunteered to be the HRA representative to the MCP Board of Directors
(non-profit organization). With no interest by other HRA members, the HRA
commissioners agreed to the appointment of Commissioner Steve Andrews to the MCP.
Bob Murray and Darrin Lahr volunteered to be the HRA representative to the EDA (city
commission). As both candidates qualify to serve on the EDA, the two volunteers drew
straws. By a draw of the straw, the HRA members agreed to recommend the name of
Commissioner Darrin Lahr to City Council for appointment to the EDA. The Mayor and
Council appoint all city commissioners.
Because of a previous conflict of interest with HRA members being on the Monticello
Senior Alliance, Ben Smith and Steve Johnson will continue as the HRA representatives
on the Alliance.
The HRA members received a copy ofthe 1971 HRA Bylaws. With the need to amend
Article III - Meetings, Section 1., Annual Meeting. and Section 2., Regular Meetings.;
Brad Barger made a motion to obtain copies of boiler plate HRA Bylaws from Attorney
BubuL The intent being for the commissioners to read and review prior to the May
meeting for consideration of other needed amendments. Steve Andrews seconded the
motion. The commissioners requested the obtained bylaws be mailed in advance ofthe
regular agenda allowing ample time to review. With no further discussion, the motion
passed unanimously.
5. Consideration to amend the amended and restated Private Redevelopment Contract
between the HRA and Ronald S. Musich.
Steve Andrews retracted his comment of March 5, noting the average income levels for
Wright County were lower than he anticipated, therefore, he supports the use ofTIF
assistance for the Fay-Mar expansion.
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HRA MINUTES
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With the submittal of evidence for the "but for" test, Bob Murray made a motion to amend
the amended and restated Private Redevelopment Contract between the HRA and Ronald
S. Musich dated December 15, 1994 as follows: $50,000 NPV for site improvements
associated with the expansion, pay-as-you-go [mancial method, payment upon receipt of
evidence of completion and payment of site improvements. Site improvement
reimbursement to developer from available tax increment and after retirement of HRA
$50,000 debt for original up-front land acquisition. Construction commencement date,
June 1, 1997, and construction completion date, December 1, 1997, for the minimum
improvements of the expansion (20,000 sq ft manufacturing space). The increase of
twenty new jobs at an average wage of at least $8.50 per hour by no later than two years
from the issuance of the Certificate of Completion. Annual HACA Penalty from TIF
Surplus. Steve Andrews seconded the motion and with no further discussion the motion
passed 4-0-1. Yeas: Murray, Andrews, Lahr, and Frie. Nays: None. Abstention: Barger.
Barger abstained because ofthe business relationship between Suburban Mfg. and Fay-
Mar.
6.
Consideration to review the appraisals for 218 Front Street and 3 Walnut Street for
potential purchase.
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HRA members received a copy of the appraisals for 218 Front Street and 3 Walnut Street
as prepared by John Farrell, Rockford, MN. The Front property appraised at $89,300
and the Walnut property appraised at $86,000. The EMV for payable 1996 are $65,900
and $57,700 respectively. HRA members felt the appraisals were high. One
commissioner felt the appraiser may have been influenced.
Commissioner Frie questioned the appraisals. In particular, three of the value adjustment
items: View, condition, and gross living area. Frie felt most appraisers would throw out
two ofthe three comparables due to inconsistency with reasonable appraisal guidelines.
Recent appointed HRA members questioned the purpose of the TIF Plan without the
approval of the DowntownlRiverfront Revitalization Plan as part ofthe Monticello
Comprehensive Plan. It appeared to some members that perhaps the cart was before the
horse as it relates to the following items: Assurance of necessary rezoning, lack of
available liquor licenses, potential of parcels in the flood plain, and the lack of a developer
as the driving force.
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HRA discussion and comments: Recognized appraisals were high but purchase price may
be higher in future if relocation costs were a factor. Prefer to buy low and sell high, offer
$65,000. Appraisals high without a plan, consider an option. An option doesn't take the
property off the market, it's more or less a right offrrst refusal. The unknown time frame
of an option can make an option difficult to sell or convince. Council Liaison Carlson
reported the Council plans to place the request for additional liquor licenses on a fall
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HRA MINUTES
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referendum. Acquisition can also inspire a developer said another member. Dan Frie
made a motion authorizing the preparation of a letter to the property owners of Block 54
and 64 to gage their level of interest to enter into a purchase option with the HRA. An
option not an offer. Bob Murray seconded the motion and with no further discussion, the
motion passed unanimously.
7. Consideration of pfoject updates.
a) TJ. Martin, Inc. - Private Redevelopment Contract and Assessment Agreement
executed by HRA and officers ofT.J. Martin, Inc. Building permit not issued.
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b) Prairie West Second Addition - First, the HRA discussed the need to incorporate
language into Private Redevelopment Contracts which would serve as an incentive for
developers to be accountable for completion of improvements or minimum improvements
as agreed upon within an executed contract. Costs associated with amending a contract
due to delays caused by a developer as deemed by the HRA would be at the expense of
the developer. One member felt the HRA's option may be a developer's cost. Koropchak
noted some HRAs have a non-returnable fee with the application ofTIF. The HRA will
address this item with the re-assessment ofthe TIP Policies and Preliminary Agreement or
upon drafting of new contracts.
The original Private Redevelopment Contract dated July 3, 1996, between the HRA, City,
and Cedrus Creek Craftsman, Inc. was amended the 13th of January, 1997, through an
agreement of all parties. The amendments included the final plat of Prairie West Second
Addition to be fIled and recorded by April 1 , 1997 and the commencement date for
construction of two twinhomes or four units to begin by July 1, 1997. The twinhomes or
four units for construction are located in Phase I of the Second Addition or within the TIF
District. Previously, the developer has received two reminder letters pertaining to the
Private Redevelopment Contract. Koropchak faxed the letter of April I, 1997, to the
developer recommending attendance at the BRA meeting to request an extension rather
than default on the contract. With no request from the developer, the BRA authorized a
Letter of Default as drafted by Attorney Bubul be mailed via certified mail to the
developer.
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c) Redevelopment of Mall- Redeveloper Ken Barthel appears interested in the
redevelopment of the mall or perhaps another site. He requested the HRA suggest a
second site of approximately two city blocks within TIF District No. 1-22 for
redevelopment. HRA members felt a redeveloper should pick a site and make a proposal
to the BRA for redevelopment. The HRA extended an invitation to Ken Barthel and Brad
Johnson to attend the May HRA meeting to give a presentation or an update of proposed
projects.
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HRA MINUTES
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8. Other business:
a) Dan Frie made a motion to pay HRA monthly bills with the exception of the
Hoisington March 6, 1997 invoice which was subject to approval by the MCP for
satisfaction and completion of Tasks 1 through 4. Bob Murray seconded the
motion and with no further discussion, the motion passed unanimously.
b) HRA members set an orientation date of May 7, 1997,6:00 p.m. or one hour prior
to the regular HRA meeting. The HRA Attorney and Consultant will conduct the
orientation for HRA and Council members.
9. Adjournment.
The HRA meeting adjourned at 10:35 p.m.
(T'\ II 11 ' \/__ f)l Q
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Ollie Koropchak, Executive Director
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