City Council Minutes 05-13-1996 Joint Board of ReviewMINUTES
SPECIAL JOINT MEETING
MONTICELLO CITY COUNCIL AND HRA
Monday, May 13, 1996 - 5:30 p.m.
Council Members Present: Brad Fyle, Shirley Anderson, Clint Herbst, Brian
Stumpf, Tom Perrault
Council Members Absent: None
HRA Members Present: Al Larson, Roger Carlson, Bradley Barger
HRA Members Absent: Tom St. Hilaire
A special joint meeting was held with the City Council and Monticello Housing and
Redevelopment Authority for the purpose of considering approval for the overall
concept plans for the redevelopment project known as Prairie West. The project
area is divided into four additions: 1st Addition, which is the original Prairie West
subdivision; 2nd Addition, which is the proposed TIF district; 3rd Addition, which is
a parcel currently owned by the City; and 4th Addition, 1400 West Broadway.
Economic Development Director 011ie Koropchak reported that on May 1, 1996, the
HRA approved entering into a preliminary agreement with the developer, Cedrus
Creek Craftsman, Inc. (John Komarek), which authorizes Publicorp, Inc., to begin
preparation for establishment of the TIF district and Kennedy & Graven to begin
preparation of the private redevelopment contract. Koropchak noted that the
overall goals of this redevelopment project are to remove blight, increase property
values, and create public green space.
Mark Ruff of Publicorp, Inc., explained that the project would include 29 housing
units. The 1st Addition would be funded with private dollars, and the 2nd Addition
would be the proposed TIF District No. 1-20, which would require HRA assistance
in the amount of $130,000 plus the City property in order for the developer to
receive a total sales return of 6.5%. Typical development returns are 9.5%.
Without HRA assistance and the City property, the return would be only 2.1%;
therefore, the proposed TIF district satisfies the "but for" test.
Ruff went on to explain that the 3rd Addition is the parcel currently owned by the
City, on which approximately $35,000 was spent to clean up the property. He noted
that a city can avoid a HACA loss if it commits to a local contribution of at least 5%
of the expected tax increment. It was proposed that the City gift $20,000 of the
value of the property to the developer and receive a payment of $15,000, thereby
avoiding the HACA penalty, receiving some compensation, and receiving tax
revenues from the 19 units of housing outside of the TIF district.
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The 4th Addition property located at 1400 West Broadway would be purchased by
the HRA with the intent of deeding the property to the City to use as green space.
The amount of the purchase price, including estimated relocation costs and
attorney, relocation consultant, and appraisal fees is $145,000.
Council discussed the amount the City has invested in the parcel being proposed for
the 3rd Addition and noted their concern with making a local contribution of
$20,000 in addition to the TIF district and purchases that would be made by the
HRA. Staff also discussed with Council the $11,000 in taxes is owed to the County
for this parcel and the agreement with the County that the City would market the
property for sale. City Administrator Wolfsteller advised that any agreement
regarding the use of this parcel for the proposed Prairie West development should
be presented to the County Board.
Councilmember Perrault suggested that the 4th Addition proposed for green space
should be developed if possible rather than adding to the park inventory. The
developer noted that there is very little high ground in this area and that most of it
is undevelopable.
Al Larson noted that the proposed development is supported by the HRA because of
the benefits to the tax base and the local area created by combining the area parcels
into a single development project. In addition, a blighted property will be
eliminated and replaced with a park on the pathway.
AFTER DISCUSSION, A MOTION WAS MADE BY SHIRLEY ANDERSON TO APPROVE
THE OVERALL CONCEPT PLAN FOR THE REDEVELOPMENT PROJECT KNOWN AS
PRAIRIE WEST, ESTABLISH TIF DISTRICT NO. 1-20 AS A REDEVELOPMENT
DISTRICT, COMMIT A LOCAL CONTRIBUTION OF $20,000 FOR THE CITY -OWNED
PARCEL, AND ACCEPT THE PROPERTY LOCATED AT 1400 WEST BROADWAY FOR
USE AS GREEN SPACE. Motion died for lack of a second.
A MOTION WAS THEN MADE BY BRIAN STUMPF AND SECONDED BY SHIRLEY
ANDERSON TO APPROVE THE OVERALL CONCEPT PLAN FOR THE
REDEVELOPMENT PROJECT KNOWN AS PRAIRIE WEST, ESTABLISH TIF DISTRICT
NO. 1-20 AS A REDEVELOPMENT DISTRICT, AND ACCEPT THE PROPERTY LOCATED
AT 1400 WEST BROADWAY FOR USE AS GREEN SPACE. THE CITY MUST RECOVER
ITS OUT-OF-POCKET COST FOR THE CITY -OWNED PARCEL PROPOSED FOR THE
3RD ADDITION OF THE PROJECT, AND THE PROPOSAL MUST BE PRESENTED TO
THE COUNTY BOARD. MOTION ALSO INCLUDES ADOPTING A RESOLUTION
CALLING FOR A PUBLIC HEARING ON ESTABLISHMENT OF TIF DISTRICT NO. 1-20
FOR JUNE 24, 1996.
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COUNCILMEMBER PERRAULT THEN AMENDED THE MOTION TO ADD THAT THE
AREAS THAT ARE DEVELOPABLE ON THE 4TH ADDITION PARCEL ARE TO BE
DEVELOPED RATHER THAN USED FOR ADDITIONAL PARK AREA.
Voting in favor of the motion: Brian Stumpf, Shirley Anderson, Clint Herbst, Tom
Perrault. Opposed: Brad Fyle. Fyle noted that if the City is reimbursed the cost for
the City -owned parcel, the City will suffer HACA loss due to the proposed TIF
district. Motion carried. SEE RESOLUTION 96-20.
Mark Ruff noted that the HRA would not recommend that the City lose HACA aid
and would meet with the attorney to ensure no loss of HACA to the City.
There being no further business, the special joint meeting of the Council and HRA
was adjourned.
Kare , Doty
Office Manager
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