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HRA Minutes 02-05-2003 . . . MINUTES MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY Wednesday, February 5,2003 - 6:00 p.m. 505 Walnut Street - Bridge Room C0111111 issioners Present: Chair Brad l3arger, Vice Chair Steve Andrews, Dan Frie, Bill Fair and Council Liaison Roger Carlson Darrin Lahr Rick Wolfsteller, Ollie Koropchak, and Lori Kraemer Absent: S talT: I . Call to Order. Chair Barger called the meeting to order at 6:00 p.m. and welcomed Roger Carlson. City Council Liaison 2. Consideration to approve the January 8, 2003 liRA minutes. A MOTION WAS MADE BY BRAD BARGER TO APPROVE THE MINUTES OF cr\IE JANUARY 8, 2003 BRA MEETING. STEVE ANDREWS SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. ") -) . Consideration of adding or removin!! ite111s l1'om the agenda. Koropchak added item 13 to the agenda asking the HRA to consider authorization of 11 F reimbursement to Central Minnesota Housing Program. 4. Consent A!!enda. A. Consideration to adopt a resolution decertifying TIF District No. I-IS. A MOTION WAS MADE BY BILL fAIR TO APPROVE TIIl~ CONSENT AGENDA AS WRITTEN. STEVE ANDREWS SECONDED TI IE MOTION. MOTION CARRIED UNANIMOUSLY. 5. Continued - Consideration to hear an update on the progress 1"<)1' redevelopment of a portion of Block 52. Ollie Koropchak advised that Fred Katter was present and would be updating the HRA on the project. Katter stated that they had a previous meeting with City staff and engineers, advising that it went smoothly and he feels they have good working relations with staff. Katter added that they would bc hiring a builder and hoping to have someone under contract by next week. He added that they would be ready to begin negotiating the Contract for Private Redevelopment by February 17, stating that in that time they will have a better handle on costs and issues, especially those eligible for TIF funding. Katter I-lRA Minutcs - 02/05/03 . provided the proposed layout of thc building, looking at approx. 60,000 sq. ft., 3 stories, which includes both phases with the first 1100r to be rctail. Katter stated there are several issues to be aware of such as working on a zero lot linc basis, and due to utilities in Broadway and Highway 25, they will be putting in stcel shoring serving as a form for concrete. He statcd they have completed about 50% of soil tests and fi.1lll1d ground water 13 ft. below the surf~lce, and it appears that construction can be done without substantial de-watering expense. They will look at environmental engineering later in the week and will be drilling test holes, etc., and have that inf()Imation by the next week. They will also do more soil testings after that. Katter advised they are estimating that eligible costs will rise from preliminary numbers previously stated several months ago. I Ie further noted 43 parking spaces underneath the building as proposed and provided a drawing of a ramp to the lower level parking, although they are proposing to modify the plan due to the steep slope. Kauer asked the I IRA to consider if the acquisition of the building in the center of the proposed projeet should be acquired in Phase I, as Koropchak had suggested a possible long term parking deck ofT Walnut St. or Hwy. 25, and that building would interfere. They do not know the cost of acquisition at this time, as they have not yet spoken to the owner. They discussed what the building had previously sold for. as well as the actual value of the building per the County Assessor. . Dill Fair suggested that possibly the City could get involved in relocation at some point noting the business doesn't really fit in that area and may be better served in the Industrial area. They added that the building was primarily for storage. Koropchak asked Katter if the contract "Yould be for both phases and he stated it would. She thel: asked how this would work with having more than one owner and Kauer stated he had spoken with Mr. IIeaton and feels there may be a potential for him to become involved in Phase II as a willing partieipant. Fair asked ifat some point they would need a letter of intent and Katter informed that it should be a commitment with them. Korpchak also diseussed parking issues and to look at dcck parking if there was ample space. Kauer stated deck parking would be $7,000 to $12,000 per stall, depending on the specifieations, but also could divide that cost in half as there would be 2 stalls with deck parking. Brad Barger asked about parking requirements and how close they were in comparison, and Katter stated with both phases he felt they were close to 5 stalls per 1,000 sq. n.lle again stated that a parking analysis they used determined that the normal usage is 2.8 per thousand in downtown areas, but they are reeommending 3.5, which is still below the 5 stall requirement. . Barger had parking concerns for other business owners in the area and Katter noted that they arc encompassing Walnut St. Steve Andrews questioned if there was enough parking on Phase [ without shared parking being counted ancl Steve Johnson stated there would be if 3.5 parking spots per thousand was used. but Andrews asked i[that includecl shared parking. It was clarified that some of the 3.5 would include shared parking. 2 lIRA Minutes - 02/05/03 . Johnson added that Phase II would go to 3 stories and that this had been discussed with city staff as well, and they appear to have adequate parking. Fair added that he would rather see high density use ofthc property rather than vacant parking. Fair added that he feels one of the goals of the city should be to re-evaluate parking requirements by ordinance. Koropchak asked if a public hearing was still premature and Kauer felt it was at this time. She also added that she had spoken to I Ieaton who had asked her how things were progressing, stating at that time he did not feel it would be a good fit for him. I-Ie also statcd that he had heard that the BRA was looking to condemn his property. Koropchak advised Heaton that they had not statcd that and encouraged him to consider bringing a project to the II RA. She advised that this was the reason she had asked Katter and Johnson of their intent for Phase II. The lIRA asked Attorney Bubul if there could be a contract if they did not own all of the property and Bubul stated that could be negotiated with the developer. lIe advised this decision should be made soon so that the developer is aware, up front in regard to whethcr the HRA would be willing to condemn a building. . Fair questioned ifthc developer could do Phase I without 11, adding that they need some assurance from the developer. Dan hie stated that he would prefer to go ahead with Phase I and let them, or someone else, move forward with Phase II, not condemning any properly. Koropchak advised Bubu.1 that when the liRA holcls their public hearing they wo~L1d use the appraisal that the developer obtains. Bubul asked about the source of TI F and it was noted it would be from bond proceeds. There was no further discussion. 6. Continued - Consideration to hear an update on thc progress for redevelopment of a portion of Block 51. Koropchak stated she did not have further information regarding the proposed redevelopment of a portion of Block 51, although she did speak wi th Sawatzke earl ier in the week and he advised he was in the process of putting information together for his perfonna. Koropchak stated he sounded serious about moving forward, although he had not had conversations yet with the property owncr on the corner as he was still out of town. Koropchak slated thal Sawatzke would possibly be ready to address the HRA in March. 7. Continued - Consideration to hear an update for redevelopmcnt of Block 36, Phase 11. . Koropchak stated she had spoken with Barry Fluth and his project seems to be moving f(Jrward as well, and lhey have been in negotiations with property owners as well. That proposal is for housing in Phase II. 3 HR^ Minutes - 02/05/03 . Fair asked Koropchak if the City would be recognizing and/or wclcoming Crostini's Grille since the project was ajoint venture with the City. She advised that she would look into possibly a plaque. Fair felt there should be hetter PR with new husinesses in the City. Koropchak added that she could provide before and after pictures to the restaurant to be displayed. It was discussed that the Monticello Times should also be involved and Koropchak added that she would be putting this information on the website as well. R. Consideration to discuss the resignation of liRA Attorney Dan Greensweig from Kennedy & Graven. Koropchak advised that she had been notified that Attorney Dan Greensweig would be resigning. She advised that Steve Bubul was present to discuss this with the HRA, adding that she had asked hill1 if he would be interested in serving the HRA and if so, what his rates would bc. . Steve Bubul advised that Greenwsweig would he going to work for the Statc Auditor's office. lie introduced Beth Taylor who works with them on TI F projects and in municipal law. He stated that both of them would he happy to assist the liRA. Buhul advised that rates are different depcnding on expcrience, his being higher and Beth's lower, which would actually cven out the rate f()r the II RA. Koropchak asked if they generally had contracts with IIFZA' sand Bubul stated generally not. Steve Andrcws asked about a discounted rate i r they are held on retaincr and Bubul stated not typically as it is more an hourly rate whcn working on rcdevclopmcnt projects. Koropchak asked if the commission~rs would like to continue working with Kennedy & Graven and it was their consensus to continue with them. 9. Consideration of a request by City Council to review City Vision & Governing Policies for input and to dcvelop a list of goals. Koropchak advised that this request was based on Council direction at a special meeting on 1/27 !O3, and that each commission was to come up with goals/projects and prioritize them. She askcd that hy thc March 5th meeting these be submitted and they could sort and prioritize them at that mceting. Roger Carlson stated this had not been looked at for several years and needed to be updated. Bill Fair asked what is the priority and it was noted both long term and short term projccts. It was also noted that this information needs to be ready for the second mecting in March of the City Council. Koropchak advised she would provide the J IRA with information from prcvious years. Fair stated he preferred they sublnit these ahcad oftime, asking for several items from each In ember, and then submit all at the March meeting so work could be done prior to the mecting. . 1 (). Consideration to authorize payment of HRA hills. 4 . . . 11. (-IR^ Minutes - 02/05/03 A MUrlON WAS MADE BY DAN FRIF TO AUTHORIZI'; PAYMENT OF TIlE HRA BILLS. STEVE ANDREWS SECONDED THE MOTION. MOTION CARRIED UNANIMOUSL Y. Consideration of Exeeutive Director's Report. There were no additions. Brad Barger asked which building was going to be the Production Stamping building and it was noted it was the Wright Choiee building. Koropchak did add that due to issues, the sale of thc I I Window building was not complete. 12. Committee Reports - Marketing. Brad Harger advised of their first marketing mceting in the last six months and that there were new representatives from the IDe. They reviewed moving forward with targeting new businesses, and made a commitment toward thc Chamber Ci-olf outing on May 15th. Thcy are also targcting gctting eosts of advertising for signage to market businesses for Monticello. Something to draw businesses as well as busincss retention, adding that perhaps existing businesses could utilizc the sign as well. Bill Fair asked ifit could be ajoint venture betwcen City and Chamber and would it be bcnefieial in asking thc City Couneil to approaeh the Chambcr to see if they would be a willing participant. Also diseussecl advertising at the new athletie complex, ifthat cmne through. Fair questioncd how this information would be forwarded on to City Council and Barger stated this was just a starting point. Koropchak added that they would be giving gratis tickets for golf to some of the businesses/developers. This will be put on the web site as well. Barger adviscd that Elk River provides new businesses with a brochure including all steps, contaets, etc., making it easicr for new businesses up~front. Again Fair askcd how this information would be hrought f(wward and Koropehak advised that she had not received speeific direction on some of the discussions, thcre is a budget, and they are moving forward on smaller projeets at this time. Barger askcd for ideas that he could share as well. 13. Consideration to authorize issuanee of a Certifieate of Completion for 501" 503, and 505 Walnut Street and to authorize the first TIF reimbursement payment to Central Minnesota Sinde Family Housing, LLC . Koropehak adviscd that CMl-IP is asking for their TIF reimbursement, advising that typically she does not ask the lIRA to authorize if the applieant follows the contract, but 5 . . . liRA Minutes - 02/05/03 in this case she had been previously forewarned that CMHP would be asking for the first payment. The contract states that they needed to have 3 houses complete by 12/02 and they are in dcJ~lult of the contract in that regard. She also noted a tax deficiency clause in the contract and the square footage was reduced and basements added, by approval of the Planning Comlnission. It was discussed that they arc more concerned with that what is proposed and what is built is not always the smne. She also reminded them that they increased their TI F assistance. Koropchak added that there were no shutters on the hOLlscs and the columns were actually 2 x 4's. She advised that staff is concerned as there have been quite a few concerns from the public as well. Koropchak stated she did receive a letter from Sheri Harris. CMHP, advising that the shutters are on order. and staff is still insisting on the columns. They are asking for disbursement of the $53.000. They did provide documentation of purchase agreements and checks l~)r the sale of 3 lots. Shc advised the City purchased 2 lots, then sold them to CMIIP. and there was an agreement that the City would not get the $95,000 until the 11 th house was sold. City Administrator Wolfsteller suggested that there be a copy provided by the title company that they have the $95,000. Koropehak advised she did ask Ilarris for this but that Harris stated they do not have the lnoney to pay the City untj I the units are sold. CMIIP does own the property and the City has not been paid at this point. Wolfstellcr advised that they agreed to wait until the end, but they were under the assumption tlmt the title company was holding the money in escrow, theref(we not getting the money Llntil the end of the project. He would like some guarantee hom the title company stating they have the money. lie also added possibly getting a lien against the last unit as the City did state they would wait until the end to collect. A MO"J'ION W AS MADE BY STEVE ANDREWS TO TABLE UNTIL THE MARCIl 5,2003 MEETING, REQlJESTING STAFF PROVIDE A REPORT ON TilE STAT1JS OF THE PROJECT AND WITI I THE CONDITION THAT CMHP COMPLY WITII ALL CONDITIONS FOR APPROVAL REQUIRI-m BY THE PLANNING COMMISSION AND PER THE CONTRACT. DAN FlUE SECONDED THE MOTION. MOTION CARRIED lJNANIMOUSL Y. 14. I3arger asked Koropchak to elarify the ownership of the land where the proposed ice arena is to bc located, adding that he had heard that the HRA was the owner of the land. Koropchak advised that this site had come back as a tax forfeiture and that it camc back to the HRA. There was an agreement with the City and the HRA at that lime. W olfsteUer advised that ifthe land is in the HRA' s name and the project goes forward, they would have to look into how to procecd. He also advised of a change in the financing of the project, and that they are now looking for thc City to guarantee several 6 lIRA Minutes - 02/05/03 . thousand dollars per year in debt service f(n the next 7 years to lnake the project work. Wolfsteller stated they wanted the City to guarantee hal r of their loan. Steve Hubul added that the City would not have the authority to authorize the loan. Koropchak asked if the liRA could f(Jrego the public hearing and Bubul advised not if the property would go to the City and then to another party. If it was just to the City it would be okay. ]fthe ]-IRA held the public hearing they could sell it to whoever and for whatever price they chose. 15. Adjournment. A MOTION WAS MADE BY BRAD BARGER TO ADJOURN THE MEETING AT lU)O P.M. MOTION CARRIED. Ik lDlk ~RA (~air ---- !!f:-- ~~ . . 7