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EDA Minutes 07-27-2004 . . . MINUTES MONTICELLO ECONOMIC DEVELOPMENT AUTHORITY Tuesday, July 27, 2004 - 4:00 p.m. City Hall - Academy Room MEMBERS: Chair Bill Demeules, Vice Chair Barb Schwientek, Roger Carlson, Clint Herbst, Ron Hoglund, Darrin Lahr ABSENT: Robbie Smith STAFF: Executive Director Ollie Koropchak, Recorder Angela Schumann. GUESTS: Al Loch, Block 35 Property Owner I. Call to Order. Chair Demeules called the meeting to order at 4:00 PM, deelaring a quorum. 2. Consideration to approve the June 22, 2004 EDA minutes. MOTION BY COMMISSIONER HOGLUND TO APPROVE THE MINUTES OF JUNE 22nd, 2004. MOTION SECONDED BY COMMISSIONER SCHWIENTEK. MOTION CARRIED. 3. Consideration of adding or removing agenda items. Koropchak added payment of bills as item number 7. 4. Consideration of notices received from some of the Block 35 propertv owners and consideration whether to move forward or not move forward with Block 35 improvements. Koropchak provided an update on the progress of the proposed Block 35 project to this point. Koropchak reviewed an outline of how the development and service agreement would work should the project move forward. Koropchak indicated that she had discussed with the attorney the difference of the (429) versus (428) public hearing process. She noted that the (428) service district would levy a dollar amount onto their existing taxes. Property owners would have an association which would bid out maintenance for a fee. At a specified time. the property owners would request for disbursement through the tax levy to pay the contractor. EDA Minutes - 07/27/04 . Koropchak stated that one of the primary rcmaining issues for the property owners were the proposed parking restrictions. Koropchak indicated that the attorney specifically asked the EDA to consider a policy for private parking. Due to the fact that the project funds would be coming from the liquor store, the City would have the flexibility to restrict parking. The EDA would have to make a motion on that matter in order to clearly resolve the matter. Koropchak noted that the Council had opened and continued the public hearing on the 429 until further recommendations were made by the EDA. Property owners Doug and Karcn Schneidcr and the Masons have indicated they do not want to be assessed, nor do they want to be part of the public funding improvements and service district. They have indicated that they will not grant access to their properties to complete the project. Al Loch, representing the Block 35 property owners, indicated that Schneider had criticized the proposed parking situation due to agreements with leasees. Originally, she had indicated that they would work through that with the City. Loch stated that he had also specifically asked Schneider that if parking issue could be resolved, would they move forward. Loch stated that does not appear to be thc case. . Hoglund had spoken with Schneider who had also indicated to him that parking is still the main issue. It appeared to him at that time, that if the parking could be resolved, it could possibly move forward. Lahr indicated that perhaps the EDA could negotiate on the parking issue if other concerns hadn't arisen. Herbst indicated that when he had spoken with the Schneider's, it seemed to be more of an issue with potential eosts. Without the support of all of the property owners and other unresolved engineering issues, Koropchak and Wolfsteller are not recommending moving forward. Herbst agreed that having four parcels in disagreement with the project presents a problem. Hoglund stated that it was important to the EDA that 100% of the property owners agree to the terms of the project. Loeh questioned the parking restriction on behalf of Schneider, indicating that if that were the only issue, could the EDA make a motion to allow some private parking. Koropchak stated that should the EDA decide to move forward, they will also have address other concerns outside of parking and then deal with the discussions surrounding the development agreement and service district. Herbst believes that there are multiple issues preventing the project from moving forward at this point. . 2 . EDA Minutes - 07/27/04 It was noted that the project had originated as a way to improve drainage in the area, and to clean up the blight and improve the look of the plaza. Koropchak stated that the ratio of public to private lunding was closer at the start of project consideration. Loch stated that when the parking lot is repaved he will still ask that a storm water line connect to a catch basin for his parcels. Loch would put underground lines in at his cxpense. Loch will still be putting on awnings. Koropchak stated that John Simola would stilllikc to movc forward with the public parking lot. At some time, the alley will still need to be re-done as it is a liability for the City. Carlson commented that the alley easement was never recorded. The EDA Commissioners recommended that the City get a permanent easement on the north half. Herbst discussed the ramifications for business owners without the easement, including plowing, etc. Loch asked how to procecd as he would like to complete his work at the samc time that the alley work is completed. Koropchak statcd that Council hadn't considered the matter indcpendently of the proposed project at this time. . Discussion on alley improvcments tabled until August 9th Koropchak thanked the propertics owners, and specifically Al Loch, for their work on the proposed project. Loch stated that the Schneiders had indicated that they were interested in finding out the final prices after the bids came in for rcference on potential costs. A brief discussion on whether to move forward in acquiring bids and specs for the purposes of cost analysis for property owners progressed. MOTION BY COMMISSIONER LAHR TO CANCEL THE PREPARATION OF THE PLANS AND SPECS AND ADVERTISING FOR BIDS AND REQUEST COUNCIL CANCEL THE 429 PUBLIC HEARING OF AUGUST 9th, 2004. MOTION WAS SECONDED BY COMMISSIONER HERBST. MOTION CARRIED. Lahr thanked Al Loch for the numerous hours he put into the project. Carlson echoed that and notcd the number of obstaclcs preventing the project from moving forward at this timc. . Koropchak also thanked the EDA members for their time. She recommendcd Loch talk to John Simola about the alley project and design. 3 . . . EDA Minutes - 07/27/04 5. Consideration to define terms and conditions and authorize preparation of a draft copy of the Development Agreement between EDA and Block 35 property owners. NO ACTION REQUIRED DUE TO PREVIOUS ITEM DECISION. 6. Consideration to authorize execution of a Satisfaction of Mortgage for GMEF Loan No. 16 (Aroplax). MOTION BY COMMISSIONER SCHWEINTEK TO AUTHORIZE EXECUTION OF THE SATISFACTION OF MORTGAGE FOR GMEF LOAN NO. 016 FOR AROPLAX. MOTION SECONDED BY COMMISSINER HOGLUND. MOTION CARRIED. 7. Other Business. MOTION BY COMMISSIONER HERBST TO AUTHORIZE PAYMENT OF EDA BILLS. MOTION SECONDED BY COMMISSIONER CARLSON. MOTION CARRIED. 8. Adjournment. MOTION BY COMMISSIONER HERBST TO ADJOURN. MOTION SECONDED BY COMMISSIONER CARLSON. MOTION CARRIED. ~~~A Recorder 4 . MINNETONKA 4625 County Road 101 Minnetonka, MN 55345 (952) 933-9550 CHAMPUN 11431 Jefferson Court N, Champlin, MN 55316 (763) 488-1566 MONTICELLO 106 East 4th Street Monticello, MN 55362 (763) 271-7200 BUFFALO 555 Highway 55 Buffalo, MN 55313 (763) 682-{)555 . MAYER 101 Ash Avenue North Mayer, MN 55360 (952) 657-2500 GLENCOE 606 East 11th Street Giencoe, MN 55336 (320) 864-3161 HUTCHINSON 308 Main Street South Hutchinson, MN 55350 (320) 587-8800 STEWART 737 Hall Street Stewart, MN 55385 (320) 562-2553 SHOREWOOD 24000 Highway 7 Shorewood, MN 55331 (952) 474-2126 A.:.RST MINNESOTA .MORTGAGE SHOREWOOD 24000 Highway 7, #210 ShorewOOd, MN 55331 (952) 392-3682 FIRST MINNESOTA BANKN..A. October 21,2004 Ollie Koropchak Economic Development Director City of Monticello 505 Walnut Street, Suite I Monticello, MN 55362 RE: EDA LoanlHamond Property on West Broadway Dear Ms, Koropchak: Approximately six months ago, we provided correspondence to you in which we supported a request by Bruce and Cindy Hamond to extend the maturity of an EDA financing package from May I, 2004 for six months, The purpose of the requested extension was to allow them to process a loan for improvements including new construction, We were pleased that you granted that request. As you know, that six-month extension period is now up and the loan balance remaining on the financing package is set for discussion by your EDA Committee, Unfortunately, the original intention by the Hamonds to proceed with the property improvements has been postponed due to their perception of a lack of economic activity in the downtown corridor. Their plans to improve the property had been based on the coinciding implementation of several downtown projects including planned commercial developments surrounding the Al Loch property, the Barry Fluth property, and the discussion of a possible Wa!green~ Drug;Store as a downtown 3e!dition, . Unfortunately, these projects have not proceeded to date, In my recent conversations with the Hamonds, it is still their intention to move forward on developing the site as a commercial property and provide their support of the downtown business community dependent on a sound economic review of the downtown business climate, In fact, their support is reflected in plans to open a fitness-related business to be operated directly by the Hamonds at their existing commercial property, It is my understanding that the Hamonds have been faithfully making payments towards the reduction ofthe EDA financing package and it is their intent to continue to make future principal reductions in the principal balance of the loan, Estab!tsnec .,~ m:r"