EDA Minutes 05-13-2015MINUTES
REGULAR MEETING — ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Wednesday, May 13, 2015, Mississippi Room, Monticello Community Center
Present: Bill Tapper, Tracy Hinz, James Davidson, Steve Johnson, Tom Perrault, Lloyd
Hilgart
Absent: Bill Demueles
Others: Jeff O'Neill, Wayne Oberg
1. Call to Order.
Bill Tapper called the meeting to order at 6:00 p.m.
2. Roll Call.
3. Approval of Minutes.
a. Special Meeting, April 8, 2015. Minutes not available.
b. Regular Meeting, April 8, 2015. Minutes not available.
JIM DAVIDSON MOVED TO TABLE APPROVAL OF THE MINUTES TO THE
NEXT EDA MEETING. MOTION SECONDED BY TRACY HINZ. MOTION
CARRIED UNANIMOUSLY, 6 -0.
4. Consideration of additional agenda items.
None.
5. Consideration of approving Payment of bills.
Tom Perrault inquired about the invoice to Northland Securities. Tracy Hinz said that it
appears it was for services totaling 4 -hours to discuss specific EDA questions about the
tax levy. Bill Tapper brought up concerns about high consulting fees and that we should
be more careful about asking for opinions from consultants and maybe we don't need
them as much. Jeff O'Neill said that staff will be conscientious and do their best to pick
and choose when they bring in consultants.
TRACY HINZ MOVED TO APPROVE THE PAYMENT OF BILLS THROUGH
APRIL 2015. MOTION SECONDED BY JIM DAVIDSON. MOTION CARRIED
UNANIMOUSLY, 6 -0.
6. Consideration to adopt Resolution EDA 2015 -006 approving an Assignment and
Assumption Agreement between Front Porch Associates, Ltd. and Michael Cyr as
related to Tax Increment Financing District No. 1 -29.
Michael Cyr, developer of the Vine Place project, has requested the contract between
Front Porch Associates, Ltd., the HRA and the City be assigned to himself as the business
entity is being dissolved. Cyr has requested the EDA approve an assignment of the tax
increment for TIF District 1 -29 as the development project is now completed and the
obligations have been fulfilled. Upon approval and execution of the assignment and
assumption, Cyr will receive the available tax increment and will assume the continuing
rights and obligations of the contract.
City staff has concurred that the development improvements required by the contract
have been completed and any private loans or mortgages associated with Front Porch
Associates, Ltd. have been satisfied.
LLOYD HILGART MOVED TO ADOPT RESOLUTION EDA 2015 -006 APPROVING
AN ASSIGNMENT AND ASSUMPTION AGREEMENT BETWEEN FRONT PORCH
ASSOCIATES, LTD. AND MICHAEL CYR AS RELATED TO TAX INCREMENT
FINANCING DISTRICT NO. 1 -29. MOTION SECONDED BY TRACY HINZ.
MOTION CARRIED UNANIMOUSLY, 6 -0.
7. Consideration to approve expense and authorize agreement related to additional
demolition related costs and completion of a Phase II Environmental Site
Assessment for the EDA -owned property at 100 East Broadway.
MnDOT has requested that the City complete a Phase II ESA as part of MnDOT's
TH 25 /CSAH 75 intersection project plan review. This request is related to the
conveyance of land to MnDOT for the right turn lane from northbound TH 25 to
eastbound CSAH 75. This conveyance will transfer property from the EDA to MnDOT
for the right of way purposes. WSB & Associates, the City's consulting engineer, has
prepared a scope of work for the Phase II analysis. The scope includes a description of
services, timeline for completion and cost estimate.
Furthermore, there may be additional fees related to unknown conditions discovered with
the demolition. Shibani Bisson, City Engineer, explained that on May 6, after the
building was demolished and the footings were being removed, discolored soil and
petroleum type odors were observed. A soil sample was sent out to a testing lab and
those results will be back later in the week. Therefore, WSB is recommending ::roving
forward with the Phase II ESA as was originally recommended with the Phase I report as
was noted that the site was a previous fueling station.
The fees were originally estimated at $12,500 (half for borings & testing and the other
half for on -site observation and reporting). Since that original estimate, MnDOT has
requested some additional tests which are directly related to the fact that there was a coal
gasification plant at the old "zoo" building, three buildings down. MnDOT is requesting
this as the property will be conveyed to them with the right of way (ROW). Furthermore,
the City's Water & Sewer Superintendent discovered an additional 4" PVC line under the
sidewalk along TH 25 that connected to the known 6" service line that was to be
extended to the site as part of the demolition contract. A trench box was delivered to the
site to allow for safe exploration of the 4" line to determine where the service extends to
within the site where it should be disconnected and capped. The total cost of the
additional fees is $5,050 for a total of $17,550. Bisson explained that they are looking
for an additional $3,856 over this amount to cover the additional testing and possible
remediation costs. Some of these fees and expenses may be refundable through the PCA.
Bisson included a soil boring location map in conjunction with the Phase II ESA which
indicates three additional boring outside of Block 34. WSB is recommending taking all
of the borings to get a good cross section and this is also a requirement by MnDOT.
Tapper brought up concerns that some of the fees for the borings being required by
MnDOT that aren't on Block 34 shouldn't be the responsibility of the EDA but rather
should be charged back to the intersection improvement project.
TRACY HINZ MOVED TO APPROVE THE EXPENSE OF $21,406 AND
AUTHORIZE THE EDA DIRECTOR AND PRESIDENT TO ENTER INTO AN
AGREEMENT RELATED TO COMPLETION OF A PHASE II ENVIRONMENTAL
SITE ASSESSMENT FOR THE EDA -OWNED PROPERTY AT 100 EAST
BROADWAY AS WELL AS THE THREE BORINGS OUTSIDE OF THE EDA
PROPERTY. MOTION SECONDED BY LLOYD HILGART. MOTION CARRIED
UNANIMOUSLY, 6 -0.
g. Consideration of action relatine to Transformation Home Loan.
Jeff O'Neill provided information on an EDA Transformation Horne Loan which is in
default related to property at 312 East River Street in the amount of $9,581. The
mortgage agreement (third mortgage) for the Transformation Horne Loan with the
property owner was entered in 2007, and the Transformation Home Loan allows for
forgiveness of the loan if the property is not sold within five years of the closing date of
the loan. The City Finance Department had been tracking the loan and noted in 2010 that
the property at 312 East River Street had gone into foreclosure. At that time, the Finance
Department and Economic Development Department decision was to wait for the title
company to contact the EDA as part of the title search. The title company, however, did
not contact the EDA and to date, no information has been provided. The property went to
sheriffs sale in 2010, and there was no document filed to satisfy the HRA mortgage or
release it. The property was purchased in May of 2014 by a private party and is no
longer bank - owned.
With few options for recovery and the cost to pursue action likely larger than the loan
amount, the EDA is asked to determine whether to take further action against the original
property owner or to declare the amount unrecoverable and close out the loan.
LLOYD HILGART MOVED TO DECLARE THE DEFAULTED LOAN AMOUNT
UNRECOVERABLE AND CLOSE OUT THE TRANSFORMATION HOME LOAN
RELATED TO THE PROPERTY AT 312 EAST RIVER STREET. MOTION
SECONDED BY JIM DAVIDSON. MOTION CARRIED UNANIMOUSLY, 6 -0.
9. Consideration to adopt the 2015 EDA Work Plan.
A draft 2015 EDA Work Plan was included in the EDA agenda packet for review. Jeff
O'Neill noted that the plan is based on feedback received during the February, March and
April EDA workshops regarding the development of the plan.
Tracy Hinz said that her concern is that the work plan is listed as a single -year document
and that it could possibly be on a two -year cycle. O'Neill said that while the work plan is
prepared as a single -year document, it is understood that many of the goals will require
more than one year to realize and some are on- going. The categories for the work plan
are reflective of the Comprehensive Plan's primary goals for economic development
which are:
o Attracting & Retaining Jobs
• Expanding Tax Base
• Enhancing Downtown
• Facilitating Redevelopment
TRACY HINZ MOVED TO APPROVE THE WORK PLAN AS PREPARED AND
PRESENTED. MOTION SECONDED BY LLOYD HILGART. MOTION CARRIED
UNANIMOUSLY, 6 -0. OPPPOSED: 1, TOM PERRAULT .
10. Consideration to establish an EDA subcommittee for development of an Economic
Development staff recommendation.
Jeff O'Neill explained that a work group was requested by the EDA at its April workshop
on the 2015 EDA Work Plan for the purpose of creating a subcommittee for the
development of an Economic Development staff recommendation. The EDA is asked to
appoint 2 -3 members to the subcommittee. Other members to the subcommittee would
include staff consisting of the City Administrator, Community Development Director,
Finance Director, and possibly a City Council member.
The subcommittee will review sample job descriptions, the functions of the economic
development department (past/present/future), and the contract for Market Matching
services as part of developing a recommendation. The goal is to have a recommendation
on staffing for the regular EDA meeting in June, which can then be refined and
forwarded to the City Council for consideration and budgeting discussions.
BILL TAPPER MOVED TO APPOINT EDA COMMISSIONERS JIM DAVIDSON
AND LLOYD HILGART TO A SUBCOMMITTEE FOR DEVELOPMENT OF AN
ECONOMIC DEVELOPMENT STAFFING RECOMMENDATION. MOTION
SECONDED BY TRACY HINZ. MOTION CARRIED UNANIMOUSLY, 6 -0.
11. Consideration of Director's Report.
Jeff O'Neill provided a verbal Director's Report at the EDA Meeting. Topics of
discussion included the following:
• New (Underground) Power Line Installation at Chelsea & Cedar — Xcel Energy
o Approved by City Council
• Solar Garden Project
o Possible mitigation to provide for extension of sewer & water for future
development growth
• Legislative Discussions — Proposed Bill
o Modification of the way energy producers are taxed based on an
energy producing value
o City Council supports the bill
* Ruff Auto Site:
o City Council asked to provide a letter of support
o 40 -45 Unit Development
o Workforce Housing — Eligibility Requirements
o If Council supports, project out one year
• TAC Meeting
o 7b Street Alignment
o Roundabouts /Configuration
12. Adjourn.
TRACY HINZ MOVED TO ADJOURN THE MEETING AT 7:30 P.M. MOTION
SECONDED BY TOM PERRAULT. MOTION CARRIED UNANIMOUSLY, 6 -0.
Recorded By: Beth Green
Date Approved: July 8, 2
Attest:
Development Director