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HRA Minutes 08-06-2003 . . . MINlJT~S MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY Wednesday, August 6, 2003 - 6;00 p.m. 505 Walnut Street - Bridge Room Chair Steve Andrews, Vice Chair Bill Fair, Darrin Lahr, Dan Frie, and Council Liaison Roger Carlson Brad Barger Rick Wolfsteller, Ollie Koropchak, and Lori Kraemer Comm issioncrs: Absent: Staff: 1. Call to Order. Chair Andrews called the meeting to order at 6:00 p.m. and declared a quorum. 2. Consideration to approve the July 2.2003 liRA minutes. A MOTION WAS MADE BY BILL FAIR TO APPROVE THE MINUTES OF THE JULY 2, 2003 HRA MEETING. DARRIN LAHR SECONDED THE MOTION. MOTION CARRIED UNANIMOUSLY. 3. Consideration of adding or removing items from the agenda. None 4. Consent Agenda. None 5. Consideration to adopt a resolution amendinll: the Contract for Private Development by and between the HRA, City, and Twin City Die Castings. Ollie Koropehak, Executive Director, advised the HRA of a request by TCDC to reduce the number of permanent full-time jobs stated in the original contract. She also noted that the total annual payroll would actually be greater than it would have been previously. Koropehak recommended approval of the amendment. There was no further discussion. A MOTION WAS MADE BY BILL FAIR TO ADOPT A RESOLUTION AMENDING THE JOB AND W AGE GOAL REQUIREMENT WITHIN THE CONTRACT FOR PRIVATE DEVELOPMENT BY AND BETWEEN '1'1 IE I-IRA, THE CITY, AND TCDC FROM 85 FULL-TIME NEW JOBS TO 42 FULL-TIME NEW JOBS AT AN AVERAGE RATE OF $18.40, EXCLUSIVE OF BENEFITS. DAN FRJE SECONDED 'filE MOTION. There was further discussion by Andrews if there were any Federal guidelines that needed to be met in regard to the required number of jobs and Koropchak advised no Federal guidelines, but Green Acres. She further advised that at least a certain percent of the jobs had to pay 160% of the Federal wages and TCDC's wages are far above that. There was no further discussion. MOTION CARRIED UNANIMOUSLY. . . . HRA Minutes - 08/06/03 6. Consideration to authorize entering into a Preliminary Development Agreement with Master's Fifth Avenue for Phase II of Landmark Square. Koropchak advised that they had met with the developer on several occasions to discuss utilities and parking, as well as the possible reduetion of 2 units along 3rd Street. 'l'he lIRA was provided with proposed sketch plans for phase 2 of the project. Brad Johnson provided an updated concept plan stating they are now pursuing the seeond phase and that their initial plan had been to privately acquire proposed space, which they feel they have accomplished. Thcy arc proposing a 2 unit duplex with a rental unit above and the others would be single family, for sale units. They havc some concerns with placing garages where the rental units are. There are also some utility issues that they are working with the city on, as well as power poles in the middle of the alley. They are checking with Exel on possible relocation of one of the poles. Johnson advised that they are proposing 12 to 16 units, 12 are shown on the concept plan. They are asking for reimbursement for part of the cost, to the point that the cost of the land makes the project work, similar to the Hans Hagen development. They are working on increased parking area as well. Johnson provided a summary of the proposed costs and Koropchak advised that funding would be up-front, if approved. Johnson advised their rcquest is for the HRA to consider TIF assistance as well as assisting with site development costs. He further advised that the lots may be sold to a local builder as there is no margin for them to be the builder. They would sponsor, finance, and design. Johnson clarified that they are looking to acquire property, demolish, and prepare the site to sell to a builder to construct. There was discussion on the proposed units in the back and Johnson stated that this was their proposal in order to get morc units, although they would consider giving that up. He further stated thcy need approx. 4 additional parking spots for Landmark Square. They've spoken to John Simola, who has been helpful as well. Thcre will be two parking spots per unit with double car garages for each unit, as well as parking em-street. Korpchak advised the lIRA that she had previously asked Barry Fluth ifhe was ready to enter into an agreement and at that time they asked her to run numbers. Koropchak did an assumption with a duplex, row homes and apartments. She advised a concern with up-front financing in that construction dates and completion dates need to be accurate in order to rccover the costs. She stated she was conservative when figuring the numbers and advised that the properties will be brought back in at today's value, which does not help in this case. She came up with approx. $250,000 for TIF assistance, but when using upfront financing, they have to look at net present value. The liRA would need to refinance a temporary bond next year, using 6.5% interest, which amounts to a TIF assistance of $150,000. She also mentioned to the HRA that they have belped with public improvements on previous projects, which is an option for the HRA as well. There was discussion whether the II RA was in f~lVor of the proposed project and felt it 2 . . . HRA Minutes - 08/06/03 would be manageable, and if so, they should enter into the agreement. There was concern on whether the project could stay on track and meet the deadlines. Johnson advised that they would be willing to sign an assessment agreement, which Koropchak concurred with, and Johnson advised that if they did not meet a deadline, they would be responsible for the costs. Koropchak questioned Johnson how it would work with the city giving them the assistance up-front and they then sell to a builder. Rick W olfsteller also advised that if they entered into an assessment agreement, each homeowner would need to be awarc of the agreement in casc of default as they would thcn bc liable for the tax deficiency. Johnson also added that they could provide a letter of credit if desired. It was further stated that any upfront moncy has to be paid to the developer by July 2004. The HRA felt this was meeting the goals of the downtown redevelopment plan. A MOTION WAS MADE BY DAN FRIE TO AUTHORIZE ENTERING INTO A PRELIMINARY DEVELOPMENT AGREEMENT WrITI MASTER'S FIFTH A VENUE FOR PHASE II OF LANDMARK SQUARE AND A DEPOSIT AMOUNT OF $3,008.00. DARRIN LAHR SECONDED TI-lE MOTION. MOTION CARRIED UNANIMOUSLY. 7. Continued - Consideration to hcar updates: A. Redevelopment of a portion of Block 51. Pat Sawatzke advised thc HRA that he signed a purchasc agrccment with the owner of the property ncxt to his and is hoping to closc in scvcral months. He further stated that if all things go as planned, they hope to bcgin the project in the spring of 2005. He is still proposing the projcct hc presented previously. Koropchak adviscd him that ifhe closcs on the property and doesn't come back to thc lIRA until 2005, perhaps the project may not meet thc but-for test in establishment of a new TIF district. They discussed thc potcntial problcm of finding cligible costs for reimbursement. Koropchak stated she will research this with the J IRA's attorney and advise Sawatzke, if the land is already purchased. B. Redevelopment of a portion of Block 37 (request for TIF assistance). Koropchak advised that Holthaus did not fccl that the project would move forward. C. Discussion relative to thc temporary TIF District 1-22 Bond. Koropchak advised that the BRA would need to refinance temporary hands by next year. Possibly if there is a proposed plan, Mark Ruff could be of assistance. Dan Frie asked what the uses are for that bond and if the HRA could use it to acqui re propel1ics in that district, and Koropchak stated they could. They further discussed that if they choose to do this, they would bccome the developer. It was also advised that if they were acquiring propcrty with no projects, thcre would be no income. 'lhcy statcd some possible options such as rentals or restaurants. Koropchak also noted some options for public improvements such as parking. The HRA felt touring 'I'll' District 1-22 would be beneficial and they decided to meet at 6:00 p.m., Wednesday, September 3, which is their next meeting. Fair advised he would like a map of the district prior to the meeting. 3 . . . HRA Minutes - 0&/06/03 D. Phase I, II, and III design concept f()f a portion of Block 52. Pred Kalter provided an update stating they are continuing to move f()rward with 2 developers on their concept plan, again advising that one developer is out-state with a f()Cus on retail, the other developer is more local with a primary focus on residential. They are not yet beyond the 50/50 point with them. Katter advised that they are still trying to define the retail portion of the project and feel they are several weeks out at this point. He feels that a month from now they will be able to state who the retail component is, ffi1d also advised that this would significantly change the site plan as their needs are much different than what they had previously thought. This also may reduce the amount of under deck parking. They do not feel that this alters the '1'IF fund and are not concerned with mecting the schedule for TIF. They hope to see plans in approx. 10 days and they wi II bc back for the September lIRA meeting. 8. Consideration to authorize payment ofHRA bills. A MOTION WAS MADE BY BILL FAIR TO A UTHORIZE PAYMENT OF TIlE HRA BILLS. DAN PRIE SECONDED TIlE MOTION. MOTION CARRIED UNANIMOUSLY. 9. Consideration of Executive Director's RepOli. Koropchak gave her report and added that shc had mailed a check to Standard Iron lor their adjustment with the county. UMC is proposing to move in on 8/23/03. CMHP has 2 closings scheduled, last house is not yet sold, waiting for approvals. Chuck VanHeel has not yet signcd the paperwork, he's been out of town. Wolfsteller advised Koropchak that within that agrccment there was not a date outlined, although indirectly it did state 8/1 /03 as a payment date. IDC is asking the liRA to consider a matching fund with the city for futurc industrial land. Stevc Andrews suggested prorating the HRA' s amount to match the city's. An amount of $1 00,000 was agreed upon, although if the city reduces thcir amount the HRA will prorate. 10. Committee Reports. Nonc 11. Other Business. None 12. Adjournment. A MOTION WAS MADE BY BILL FAIR '1'0 ADJOURN THE MEETING AT 7:25 P.M. STEVE ANDREWS SECONDED THE MOTION. MOTION CARRIED. , 1tU~ I I RA Chair 18-7 a~ 4