HRA Agenda 12-09-1998
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AGENDA
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
Wednesday, December 9,1998 - 7:00 p.m.
City Hall
MEMBERS:
Chair Steve Andrews, Vice Chair Bob Murray, Brad Barger,
Darrin Lahr, and Dan Frie.
COUNCIL LIAISON:
Brian Stumpf
STAFF:
Treasurer Rick Wolfsteller, Executive Director Ollie Koropchak,
Recording Secretary Nancy Whalen.
CONSUL TANTS:
Mark Ruff, Ehlers & Associates
Attorneys Steve Bubul and Dan Greensweig, Kennedy & Graven
1. Call to order.
2. Consideration to approve the November 23, 1998 HRA minutes.
3. Consideration of adding agenda items.
4.
Consent Agenda.
A. Consideration to recommend to City Council a commissioner for annual
appointment.
B. Consideration to approve the Certificate of Completion for BBF Properties, Inc.
5. Consideration of items removed from the consent agenda for discussion.
6. Consideration to hear a concept plan for redevelopment of the Klukas property into a
two-phased townhouse development and request for TIF assistance.
7. Consideration to hear a concept plan for redevelopment and request to enter into an
agreement for development rights to Block 54 and 64 and West Bridge Park.
8. Consideration to accept or deny a counter-offer for purchase ofthe property located at
218 Front Street.
9. Consideration of a request to discuss the use/rental of the HRA garage located at 220
Front Street.
10.
Consideration of a request to extend the deadline for execution of documents relating to
proposed Project No. II within Redevelopment District No. 1-22.
11. Consideration of a request to re-schedule the date of the January HRA meeting.
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HRA Agenda
12/9/98
Page 2
12. Consideration to authorize payment of monthly HRA bills.
13. Consideration of executive director's report.
14. Other business.
15. Adjournment.
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MINUTES
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
MONDAY, NOVEMBER 23,1998
Members Present:
Chair Steve Andrews, Vice Chair Bob Murray, Brad Barger, Dan
Frie and Darrin Lahr
Council Liaison:
Brian Stumpf
Staff Present:
City Administrator Rick Wolfsteller, Deputy City Administrator
Jeff O'Neill, Executive Director Ollie Koropchak.
Consultants:
Rusty Fifield, Ehlers & Associates
Steve Bubul and Dan Greensweig, Kennedy & Graven
1. Call to order.
Chair Steve Andrews called the meeting to order at 6:00 p.m.
2.
Consideration to approve the November 18, 1998 HRA minutes.
A MOTION WAS MADE BY DAN FRIE AND SECONDED BY STEVE ANDREWS
TO APPROVE THE MINUTES, AS WRITTEN, OF THE HRA MEETING OF
NOVEMBER 18, 1998. Motion carried unanimously.
3.
Consideration to adopt a resolution awarding the sale of Temporarv Public Proiect
Revenue Bonds. Series 1998.
Chair Steve Andrews asked Executive Director Ollie Koropchak to give a update on the
bond sale. Ms. Koropchak briefly went over the meeting of November 18, 1998, stating
at that meeting, the HRA approved the finance plan and directed Ehlers and Kennedy &
Graven to formally prepare revised legal documents to reflect the appropriate terms and
conditions of the temporary bond sale.
Rusty Fifield of Ehlers & Associates stated that the proposal was identical to the one
presented on Wednesday, November 18, 1998, at the HRA meeting. The proposal is for
R. J. Steichen & Company to purchase the bonds at an interest rate of not greater than
4.5%. The bonds will mature on February 1,2001 with interest due on August 1, 1999
and February 1,2000. Mr. Fifield, again, stated that the proceeds cannot be released
before January 1, 1999, upon approval from the new City Council.
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HRA Minutes - 11/23/98
Both Rusty Fifield and Dan Greensweig stated that nothing had changed since the
discussion on November 18, 1998.
Bob Murray asked if construction ofthe project had started. Jeff O'Neill stated that the
heavy equipment had moved on site as oftoday, Monday, November 23, 1998.
A MOTION WAS MADE BY BOB MURRAY AND SECONDED BY DAN FRIE TO
ADOPT SAID RESOLUTION AWARDING THE SALE OF $7,385,000 TEMPORARY
PUBLIC PROJECT REVENUE BONDS, SERIES 1998. With no discussion on the
motion, a vote was taken. Voting in favor; Steve Andrews, Dan Frie, Bob Murray and
Darrin Lahr. Opposed Brad Barger. Motion carried.
4. Other business.
No other business.
5.
Adiournment.
Chair Steve Andrews adjourned the meeting at 6:07 p.m.
Steve Andrews, Chair HRA
Nancy C. Whalen, Recording Secretary
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lIRA Agenda - 12/9/98
4A. Consideration to recommend to City Council a commissioner for annual appointment.
A. REFERENCE AND BACKGROUND:
HRA commissioners are appointed each year by the Mayor and City Council at the first
Council meeting held in January. The five-ycar tcrm seat held by Commissioner Dan Frie
expires December 31, 1998.
Dan Frie has agreed to serve another five-year term, the HRA may want to endorse Mr.
Frie's appointment. On January 11, the Mayor and Council will consider appointing
commission members including Dan Frie.
After Council appointment in January, the following is a list of the HRA commissioners'
terms.
Brad Barger
Darrin Lahr (Carlson)
Bob Murray (St. Hilaire)
Steve Andrews (Ellison)
Dan Frie (Larson)
December 1999
December 2000
December 2001
December 2002
December 2003
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It is suggested the HRA make a motion recommending the City Council appoint Dan Frie
for a five-year HRA term, expiration date of December, 2003.
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4B.
HRA Agenda - 12/9/98
Consideration to approve the Certificate of Completion for BBF Properties. Inc.
A. REFERENCE AND BACKGROUND:
The certificate of occupancies have been issued by the Building Department for the Cub
Foods, Hallmark, and Radio Shack retail facilities indicating completion ofthe
construction. Pcr the Contract for Privatc Redevelopment between the HRA and BBF,
Inc., completion of the minimum improvements was scheduled for December 31, 1998.
With the issuance of the certificate of occupancies, the HRA is requested to approve the
Certificate of Completion.
Additionally, the Contract states the redeveloper agrees that it will pay all "administrative
costs". Administrative costs means out of pocket costs incurred by the HRA attributable
to or incurred in connection with the negotiation and preparation of this agreement and
other documents and agreements in connection with the development contemplated
hereunder. The HRA acknowledges that the redeveloper has deposited with the HRA the
amount of $5,000 for payment of administrative costs. Upon issuance of the certificate of
completion, the HRA shall return to the redeveloper any balance of such deposit that the
HRA reasonably determines is not needed to pay administrative costs. If at any time the
HRA determines that administrative costs will exceed $5,000, the redeveloper shall pay
any additional administrative costs within 10 days after receipt of a written invoice from
the HRA. Verification ofthe total administrative costs through the city's finance
department will be in 30 days to allow final invoices from the consultant and attorney.
For your information, the $500,000 Note has not been delivered as of December 4.
Enclosed is an account of the eligible TIF expenditures for relocation, demolition, and
site improvements, the amounts disbursed by the lender, and the amounts acceptable to
the HRA. As soon as the lender provides the HRA with invoices and verification of
monies in escrow to meet the $500,000 and evidence to disburse eligible demolition or
site improvement costs first, the note will be dated and delivered. Certainly, there is
evident, the site lights and landscaping is complete.
B. ALTERNATIVE ACTION:
1. A motion of approve the said Certificate of Completion.
2. A motion to deny approval ofthe said Certificate of Completion.
3. A motion to table any action.
C. RECOMMENDA nON:
Recommendation is altef11~tive no. 1.
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HRA Agenda - 12/9/98
D.
SUPPORTING DATA:
Copy of the certificate of occupancies and certificate of completion and account of
eligible TIF disbursements.
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Building Address: 216 West J'h Street
Certificate of Occupancy
...~ City of Monticell.9
pepartment of Buildingiiispection
This Certificate issued pursuant to the requirements of Sect ion 109 of the Uniform Building
Code certifj;ing that at the time of issuance this structure was in compliance with the
various ordinances of the City regulating building construction or use. For the following:
Use Classification: Cub Foods -llferchantile
Occupancy
Group: M
Use Zone: CCD
Construction Type: II-N Sprinklered
Building Permit No: 98-4203
Owner of Building: BBF Properties
Address: ' 223 Sandber~ Road
Nfonticello.l~DV55362
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Date: i December 2. 1198
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POST IN A CONSPICUOUS PLACE
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CERTIFICATE OF COMPLETION
WHEREAS, the Housing and Redevelopment Authority in and for the City of Monticello,
MilUlesota, a public body, corporate and politic (the "Authority") entered that certain Contract for
Private Redevelopment with BBF PROPERTIES, INC. (the "Redeveloper") dated as of
, 1998 (the "Contract"); and
WHEREAS, the Contract contained certain covenants and restrictions set forth in Article
IV thereof; and
WHEREAS, the Redeveloper has performed all covenants and conditions insofar as it is
able in a manner deemed sufficient by the Authority to permit the execution of this certification;
NOW, THEREFORE, this is to certify that all building construction and other physical
improvements specified to be done and made by the Redeveloper with respect to the Minimum
Improvements (as defined in the Contract) have been completed and the above covenants and
conditions in Article IV of the Contract with respect to the Minimum Improvements have been
performed by the Redeveloper.
Dated:
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE CITY OF
MONTICELLO, MINNESOTA
19_
By
Its
By
Its
SJB135592
MN190-67
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STATE OF MINNESOTA
)
) ss.
)
COUNTY OF
On this _ day of 1998, before me, a Notary Public within and for
said County, personally appeared and , to me
personally known, who, being by me duly sworn, did say that they are the Chair and Executive
Director, respectively, of the Authority named in the foregoing instrument; and said Chair and
Executive Director acknowledged said instrument to be the free act and deed of said Authority.
Notary Public
SJB135592
MN190-67
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Relocation
I&1e
Skillet ,
Hallmark V
Jun 98
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July 98
Oct 98
H&R Block v Jun 98
Wright Way v "
Small Tenants "
Companion Pets $3,000 .;
Renaissance West $3,000 V
Monticello Optical $3,000 v
Northstar Capital $5,000 v
Barbara Lee's Dance $3,000 v
Weight Watchers $200 II
Demolition
JME Nov 98
(grading, utilities)
Site Improvements
BBF Properties, Inc.
IE Accountable Expenditures
Not-to-exceed $500,000
lillE Wilson Bank HBA
$293,000.00 $ 75,859.36 $283,000.00 $ 75,859.36
$ 47,468.28 $ 47,468.25 $ 13,233.09 $ 13,233.09
$ 38,215.51 $ 34,235.16
$ 15,240.62
$ 24,696.39 $ 24,696.39 $ 24,696.39 $ 24,696.39
$ 23,218.98 $ 23,218.98 $138,377.99 $ 23,218.98
$ 17,200.00 $ 17,200.00 $ 17,200.00 $ 17,200.00
$184,059.00 $156,957.00 $153,366.00 $153,366.00
Parking lot Nov 98 $100,000.00 $115,280.00 $115,280.00
Site light $ 36,000.00
Soil Test Nov 98 $ 1,600.00 $ 1,625.00 $ 1,625.00
Landscaping $ 17,000.00
TOTALS $562,540.65 $500,000.00 $800,234.60 $458,715.98
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HRA Agenda - 12/9/98
6.
Consideration to hear a concept plan for redevelopment of the Klukas property into
a two-phased townhouse development and request for TIF assistance.
A. REFERENCE AND BACKGROUND:
Attorney and Developer Brad Larson asked to present a concept plan for redevelopment
of the Klukas property in order to acquaint the commissioners with the project and is
requesting TIF assistance. Applications to the Minnesota Housing Finance Agency
which are leveraged with public dollars receive higher points which places the application
at a higher ranking for the award of the competitive dollars.
The enclosed map identifies the property for redevelopment. Although the property does
consist of improvements which may be substandard, the percentage of improvements
(building, parking lots, public utilities, etc) on the parcel area does not meet the
requirements for establishment of a redevelopment district; therefore, a qualified housing
district is recommended. Remember a "qualified housing district" must meet both
income and rental levels and exempts the City from the HACA Penalty. Enclosed is a
copy of the 1998 Federal low and moderate income levels, these are determined each year
in January. Maximum life of a housing district is 25 years and it is assumed only pay.as-
you-go assistance is acceptable to the HRA.
As per Brad Larson's letter, he is requesting limited assistance for the purpose to
assistance with removal/demolition of buildings and soil corrections.
The townhouse concept is a conditional use as a PUD in the R-2 zone and meets the
required level of density. With the unknown value ohhe town home units and no
authorization to proceed, tax increment projections were not ran. The classification rate
for qualified income rental is 1 % for taxes payable 1999.
HRA members should compare the plan and HRA- TIF Policies for compliance prior to
consideration of any action.
B. ALTERNATIVE ACTION:
1. A motion accepting the concept plan and use of TIF and authorizing execution of
the Preliminary TIF Agreement.
2. A motion to table any action and request more information of the concept plan
and further explore the use and level of TIF assistance.
3. A motion to deny TIF assistance for the proposed concept plan.
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HRA Agenda - 12/9/98
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C. RECOMMENDATION:
If the HRA finds the concept meets the TIF Policies, the proposal presented has
satisfactory information for a decision, and the requested amount of assistance is within
reason then the recommendation is Alternative No.1. If the presentation lacks
information for a decision and the HRA would like to further explore the project then the
recommendation is Alternative No.2. If the HRA is not interested in providing
assistance for additional affordable housing in the City of Monticello then the
recommendation is Alternative No.3. Perhaps, the HRA should consider authorizing
request for proposals for conducting a housing study for the City of Monticello.
D. SUPPORTING DATA:
Letter and concept from Brad Larson, map identifying the site, TIF Policies, and income
levels.
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BRADLEY V. LARSON
STEVEN). MUTI:I
JAMES G. METCALf, orCOUNSf,L
(1975-.1995)
Metc.alfi Larson & Muth} P. A.
A:ITORNEYS AT LAW
313 Wut Broad"wlo/
P.O. Bo;\': 446
MontiaUo, MlnntsoUl 55362-0446
mfmfaw@S01UOTn.wm
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Re: Little Mountain Manor
SALLY B. NELSON
PARALf.GAL
'IT.LEPHONE.
(612) 295-3232
fAX
(612) 295-3132
November 18, 1998
Monticello Housing Revelopment
Authority
ATTN: Ollie
250 East Broadway
Monticello, MN 55362
Dear Ollie:
Herewith enclosed please find a proposed two-phased townhouse development to
be located on the existing Edgar Klukas property lying south of River Street to be placed
on the December 9 HRA agenda.
. The purpose of my appearance is to acquaint the lIRA with the project and
requested limited assistance for the purpose of financial help with the removal/demolition
of buildings on the premises and soil correction due to existing septic systems and wells.
The soil correction relating to the buriedjunkyard has been accomplished and if you
desire, I can provide documentation of that for the HRA. By the time of the hearing, I
will have estimates in hand for the demolition, well closures, and septic removals. The
anticipated work would be entirely within the Pl]ase 1 project area. I will also at that time
have an 11x17 site plan for Phase 1 for you, as well.
If you have any questions, please don't hesitate to contact me. Thank you for your
consideration. .
Respectfully,
METCALF, LARSON & MUTH, P.A.
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BVLIkkn
enc.
cc: Skip Sorenson
Jo1mson, Sheldon, Sorenson & Hafner
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HOUSING AND REDEVELOPMENT AUTHORITY
City of Monticello
TAX INCREMENT FINANCING POLICY
program purpose: The Monticello Housing and Redevelopment
Authority will utilize Tax Increment Financing to support the
community's long-term economic and housing goals.
pOlicy Considerations: The BRA will analyze and evaluate Tax
Increment Financing proposals based upon the following policy
considerations. Each proj ect shall be measured against these
considerations and the project's value shall be determined, based
upon meeting these considerations.
1.
2.
3.
4.
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5.
6 .
7.
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The project shall be consistent with the City'S Comprehensive
Plan.
The project shall demonstrate long-term economic and/or
housing benefits to the community.
The project shall create and/or retain employment for
Monticello residents.
The proj ect shall increase moderate priced housing options for
area residents.
The project shall facilitate the redevelopment or elimination
of "substandard" or "blighted" areas as determined by the HRA.
The project shall facilitate the "clean-up" of environmentally
unsound property.
The proj ect shall provide additional public funding for public
improvements including utilities and/or park development which
would not otherwise be available.
8.
The proj eet shall be deemed to promote additional desired
"spin-off" development.
9.
The project shall demonstrate' "community involvement"
including demonstrated degrees of the various factors:'
a) Local residency of the company's owners and employees,. or
b) Local residency of the ',contractors involved in the
project, or
c) Membership in local business organizations, or'
d) Other similar factors.
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C;CUNT'I' A II Count i u
EFFECTIVE OZ/Zl/98
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DEC 02 '98 12:47PM EHLERS & ASSOCIATES
P.2/2
M;~o'ot~ Housing Finance Agen~y
INCOME LIMITS ANO MAXIMUM RENTS BY COUNTY
PAGE fl
REPOftT
DATE RUt;
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T CQ S3C
1::1/:.:./9;
EFFECTIVE OZ/Z1/98 MEolAN INCOME (AMI) 60,800
.-............. INCOME LIMITS BY HOUSEHOLD SIZE -.-----........
1 23' 5 ~ 78
17,040 19.440 21,880 24,320 26,280 28,200 30,160 32,120
",300' 24,300 27.350 30,400 32,850 35,250 37,700 40,1S0
25,560 29,160 32,820 36,460 39,420 42,300 45,240 48,160
31,700 36,250 40,750 45,300 48,900 52,550 56,150 59,800
-----. ~AXI~UM GROSS RENTS 8Y HOUSEHOLD SIZE (PRE 1990) .......
1 23 I.. 5 67 B
426 486 547 608 657 705 154 603
532 607 683 760 821 881 942 1,003
639 729 820 912 98:5 l,OS1 1,131 1,Z04
792 906 1,018 1,132 1,222 1,313' '.40S 1,495
.. ~I"UH GROSS RENTS 8T BEDROOM SIZE
o 1 2 3 I..
42~ 456 :547 632 70S
532 570 6133 790 sal
639 684 820 948 1.057
792 649 1,018 1,177 1,313
(POST 1989) ..
5 6
778 803
9n 1 ,00';
1,167 1.20'
1.449 1,"'95
tOUNTY 0087 YfL~OU HEDltlNE
."ECTIVE 02/21/98 HEelAN IHCOME (AMI) 40,500
.......-.............---- INCOKE LIMITS IT HOUSEHOLO size ~........---_...._-
1 2 3 I.. 5 6 7 8
i 40% AM I 11,360 12,960 14,560 16,200 11,480 18,800 20,Cl80 21,400
SOX A"I 1',200 16,200 18,200 20,250 21,850 23,500 25,100 26,750
i 60X AMI 17,040 19,440 21,640 24,300 26.220 28,200 30,120 32,100
e~ AM! 22,'700 2:5,900 29,150 32,400 35,000 37,600 40,150 42,750
l. .-.--. MAXIMUM GROSS RENTS BY HOUSEHOLD SIZE (PRE 1990) .. MAXIHUH GROSS RENTS BY BEDROOM SIZE (POST 1989) ..
1 2 3 4 5 6 7 8 0 1 2 3 4 5 6
'OX -'HI 284 324 364 405 437 470 502 535 284 304 364 421 470 518 :535
50" AMI 355 405 455 :506 546 567 621 668 355 380 455 526 587 6~8 668
60X AMI '26 426 546 607 655 705 753 soz 426 456 546 631 70S 777 802
t aO"..: AMI 567 647 726 810 875 940 , ,003 1.068 :567 607 728 642 940 1,036 1,068
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HRA Agenda - 12/9/98
7.
Consideration to hear a concept plan for redevelooment and request to enter into an
agreement for develooment rights to Block 54 and 64 and West Bride:e Park.
A. REFERENCE AND BACKGROUND:
Brad Johnson, Lotus Realty Services and Ron Erickson, KKE Architects, will make a
presentation on the concept plan for redevelopment of the North Anchor area consisting
of Blocks 54 and 64 and West Bridge Park. Additionally, Mr. Johnson is requesting the
HRA enter into an agreement with Lotus Realty Services for a six-month right to develop
Blocks 54 and 64 and West Bridge Park. Thies & Talle Enterprises, a real estate
investment firm, is interested in development of the multi-housing project. Initially, the
concept plan was to be presented to the HRA on November 9; however, the presentation
was delayed because of the length of that meeting. The City Council did hear the
presentation as well as the Parks Commission. Those minutes are attached.
Certainly, Brad Johnson has developed a presence in the City of Monticello and has
established a track record for producing end-results as the facilitator for redevelopment of
the mall. The proposed North Anchor concept addresses components of the Downtown
and Riverfront Revitalization Plan such as development of an inn, restaurant, housing,
and preservation and enhancement of park land.
On December 1, Jerry Kimball, retired city planner of Duluth who was involved in the
waterfront development in Duluth, shared his experience and insights with some
commissioners and others. He stated the most successful part of the Duluth waterfront
plan is the development ofthe lake walk where individuals gather for an experience. The
development of private property was secondary to development of the public property.
Secondly, development ofthe plan started from inside. After input from Mayor Fair,
Barb Esse, Rita Ulrich, Pam Campbell, Koropchak, Planning Commissioners Rod
Dragsted and Rich Carlson, and HRA Commissioner Darrin Lahr; the recommendation
was to request the ERA call a special meeting of the council, commissions, and MCP
Board of Directors for the purpose to regroup in a workshop setting to define if there
exists a common and consistent plan among the council/commission members for design
redevelopment of the North Anchor and to discuss the establishment of a public
participation process for redevelopment of the North Anchor. Commissioners Nolan and
Frie were in attendance later. Suggested dates for the special meeting are Monday,
December 21 or January 4, or Tuesday, January 19.
B. ALTERNATIVE ACTIONS:
1. A motion calling for a special meeting ofthe council/commissions/MCP Board.
2.
A motion to enter into an agreement for development rights to Block 54 and 64
and West Bridge Park with Lotus Realty Services.
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HRA Agenda - 12/9/98
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3.
A motion to proceed by touring some housing projects developed by Thies &
Talle Enterprises.
4.
A motion to table any action entering into an agreement for development rights to
Blocks 54 and 64 and West Bridge Park.
C.
RECOMMENDATION:
The City Administrator and Executive Director recommend Alternative 1, 3, and 4. This
allows for the council and commissions to regroup to define common ground, allows the
HRA time to assess the design and quality of proposed multi-housing, and maintains
flexibility while continuing to work with Lotus Realty Services.
D. SUPPORTING DATA:
Copy of the concept, minutes of City Council and Parks Commission, letter from Brad
Johnson.
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7':1 UNIT "PJ\RT/VIENT
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FUTURE BUILDING
KKE
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Council Minutes - 11/9/98
A MOTION WAS MADE BY CLINT HERBST AND SECONDED BY ROGER CARLSON TO
APPROVE THE CONSENT AGENDA AS RECOMMENDED. Motion carried unanimously.
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Consideration of items removed from the consent agenda for discussion.
None.
Public Hearing--Consideration of vacation of utility and drainage easements around
interior perimeter of Outlot A. Sandberg East subdivision.
Deputy City Administrator Jeff O'Neill reported that in order for the River Forest
subdivision to be recorded, the existing easements around the interior perimeter of
Outlot A, Sandberg East, must be vacated. The new River Forest plat will contain the
necessary replacement easements.
Mayor Fair opened the public hearing.
There being no comment from the public, the public hearing was closed.
A MOTION WAS MADE BY CLINT HERBST AND SECONDED BY ROGER CARLSON TO
APPROVE V ACA TION OF THE INTERIOR PERIMETER EASEMENTS AROUND
OUTLOT A, SANDBERG EAST. Motion carried unanimously.
Consideration of a request for a conditional use permit for a commercial use in the PZM
district. and consideration of a conditional use permit for mixed usc in the PZM district.
Applicant. Pat and Susie Townsend.
This item was added to the consent agenda as item 5C.
Consideration of proceeding with West Bridge Park and lift station improvements.
Deputy City Administrator Jeff O'Neill reported that Council tabled consideration of
West Bridge Park and lift station improvements in July pending input from the Parks
Commission on redevelopment plan concepts that could potentially impact the proposed
park improvements. The Parks Commission was generally supportive of the concept for
the Black Woods Restaurant presented by Mr. Brad Johnson; however, they requested
that a plan be established by their October meeting date. Because a plan was not
produced by the October deadline, the Parks Commission recommended that the City
Council move forward with the improvements to East and West Bridge Park, including
relocation of the lift station and sewer system, diagonal parking along Walnut Street,
construction of retaining walls from the bridge along East and West River Street, and
installation of an irrigation system.
Subsequent to the recommendation by the Parks Commission, the developer was able to
prepare a concept plan for the area and requested that Council review the plans and
consider whether to proceed with park improvements or delay the improvements
Page 3
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Council Minutes - 11/9/98
indefinitely until redevelopment of the general area occurs. Jeff O'Neill also noted that
the Public Works Director indicated concern about delaying reconstruction of the lift
station indefinitely due to the age of the system.
Mr. Ron Erickson of KKE Architects, representing Mr. Brad Johnson of Lotus
Development, reviewed the concept plan for the West Bridge Park area, which would
include a 4.5 park with a trail along the river, 60-unit and 70-unit housing developments,
a restaurant, and ampitheater.
Mayor Fair questioned whether it was too late for reconstruction of the lift station this
year. City Engineer Bret Weiss responded that planning could take place during the
winter with construction in the spring; however, he suggested that the Council set a
deadline for March or early April in order to get an early start on the project in 1999.
A MOTION WAS MADE BY CLINT HERBST AND SECONDED BY ROGER CARLSON TO
TABLE ACTION ON WEST BRIDGE PARK IMPROVEMENTS AND RETURN THE ITEM
TO THE PARKS COMMISSION FOR REVIEW OF THE REDEVELOPMENT CONCEPT.
Motion carried unanimously.
10. Consideration ofa resolution awarding the sale of$515.000 in G.O. Water System
Refunding Bonds. Series 1998B.
City Administrator Rick Wolfsteller and Rusty Fifield of Ehlers & Associatesreported
that a 6% interest rate was anticipated for the sale of the $515,000 G.O. Water System
Refunding Bonds. Five bids were received, with Norwest Investment Services, Inc.,
submitting the low bid at an interest rate of 3.9982%, which will save the City $34,358 in
reduced debt service. It was also reported that Moody's Investors Service assigned a
favorable rating of A3 to the refunding bonds.
Mr. Fifield also recommended that the $3 million G.O. Improvement Bond sale be
postponed until the December 14 Council meeting since the total debt for the refunding
bonds, the $3 million G.O. improvement bonds, and the community center bonds would
exceed $10 million and would not be bank qualified, which would result in the City
paying 10-35 basis points in higher interest cost.
A MOTION WAS MADE BY BRIAN STUMPF AND SECONDED BY CLINT HERBST TO
ADOPT A RESOLUTION A WARDING THE SALE OF $515,000 IN G.O. WATER SYSTEM
REFUNDING BONDS, SERIES 1998B, TO NOR WEST INVESTMENT SERVICES, INC.
Motion carried unanimously. SEE RESOLUTION 98-52.
11. Consideration of a resolution authorizing the execution and delivery of a ground lease
and a lease-purchase agreement. and approving and authorizing issuance of public proiect
revenue bonds and execution of related documents.
Mayor Bill Fair suggested that the Council table action on the ground lease and lease-
purchase agreement for the community center due to the HRA's action to reject the bids
Page 4
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DRAFT
Parks Commission Minutes - 11/19/98
5. Discussion on request from Brad Johnson/Lotus Realty Services.
Brad Johnson, Lotus Realty Services, reported to the Parks Commission on the concept
plan for West and East Bridge Park. Mr. Johnson explained that the Comprehensive Plan
directed the redevelopment of the downtown and riverfront area. In conjunction with the
plan the H.R.A. has been acquiring property that has been for sale along the river. There
has been no property taken by condemnation. The vision is to acquire the property in a
win-win situation. Mr. Johnson was planning to meet with Paul and Evelyn Wurm,
owners of the apartment property to the west of Bridge Park, to discuss their plans for the
future so it was timely they attended the meeting. The current concept plan shows about
450 feet of river frontage, 4 Yz acres ofland compared to 2 Y2 acres today, an upper scale
apartment building, hotel/inn, and a restaurant.
The Commissions did question why the City is only working with one developer. Jeff
O'Neill, Deputy City Administrator, explained that Mr. Johnson is working with the
H.A.. The H.A. will determine the process for working with private developers. Mr.
O'Neill stated the main focus of the Parks Commission is to decide if they liked the park
use in the concept plan. If they did, then the previously approved park improvements
should wait until it is decided what will be done in Bridge Park.
The Commission discussed waiting with the major improvements, however, did request
removing the large boulders around the parking lot and researching a better temporary
irrigation system in East Bridge park. Gregg Engle, Park Superintended, agreed to check
into a more convenient way to irrigate the East Bridge Park area.
EARL SMITH MADE A MOTION TO DELAY ALL MAJOR IMPROVEMENTS IN
WEST BRIDGE PARK UNTIL THE CONCEPT PLAN COULD BE FURTHER
RESEARCHED. Seconded by Rick Traver. Motion passed unanimously.
Page 2
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December 3, 1998
LarDS
REALTY SERVICES
Ollie Koropchak
Executive Director
Monticello HRA
250 E. Broadway
PO Box 1147
Monticello, MN 55362-9245
Fax: 612-295-4404
Dear Ollie:
Lotus Realty, on behalf of Theis and Taile Enterprises and a development entity to be
formed, request to receive "The Exclusive right and consideration for potential TIF
assistance" for the redevelopment of Blocks 64,54,51,52 referred to as The West Bridge
Park Acres, for a six month period.
During the requested time frame the Lotus Development Team will do the following;
-Present a.development plan for concept approvals.
-Negotiate land acquisition with the current owners ofthe parcels directly affected
including the HRA and the Park Board.
-Prepare a .finance -plan including tax increment assistance.
We assume the project will include market rate rental housing, and potentially an lIUl and
restaurant.
Enclosed for your review are two previous Agreements we have had with other Cities
dealing with this process.
Step A - The Right to Prospect.
Step B - Preliminary Redevelopment Agreement
Thanks for your consideration on this matter.
aere~,
Lotus
President
I
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551 WEST 78TH STREET. PO. BOX 235. CHANHASSEN, MINNESOTA 55317. (612) 934-4538 . FAX (612) 934-5472
.
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BRA Agenda - 12/9/98
8.
Consideration to accept or deny a counter-offer for purchase of the property located
at 218 Front Street.
A. REFERENCE AND BACKGROUND:
At the BRA meeting of October 14, 1998, the commissioners amended a motion to
include two counter-offer options. Options were subject to legal opinion on the
requirements of paying relocation benefits. Please read the attached letter to the seller
summarizing the HRA's ofler options.
Additionally and attached is a summary of the investment by the HRA over time based on
the two offer options. Lastly, attached is a copy of a letter from Attorney Greensweig
relating to relocation benefits.
The seller has submitted a written response to the HRA' s two offer options accepting
Package A.
B. AL TERNA TIVE ACTION:
1.
A motion ratifying the terms of Package A as outlined by the HRA and acceptable
to the seller, and authorizing legal counsel to prepare documents.
2. A motion to withdraw the terms of Package A because the BRA is liable for
relocation benefits.
3. A motion accepting the cash buy-out at $86,000 with a city loan at 5%.
4. A motion to table any action.
C. RECOMMENDATION:
The only way to avoid relocation benefits is alternative no. 2 and let the private sector
purchase the property. Alternatives 1 or 3 will include relocation benefits, a cash buy-
out would allow you to collect rent. It is suggested not to purchase for lease "as is" and
without seeing the interior.
D. SUPPORTING DATA:
Copy of October 23, 1998 letter summarizing HRA's two counter~offer options and
summary of HRA investment. Copy of submitted written response from sellerand letter
from Attorney Greensweig.
-8-
Mrs. Deb Otten
7183 Cahill Avenue
Monticello, MN 55362
October 23, 1998
Re: Real estate property located at 218 Front Street.
Dear Deb:
Thank you for your telephone call of Wednesday. I did proceed to call and check with the HRA
Commissioners for a clarification of the motion and amended motion. My apologies for misunderstanding
the amended motion. I understood the amended motion (counter-offer Package B) to mean a replacement of
the original motion (counter-offer Package A); however, the commissioners' amended motion was a counter-
offer including both Package A and Package B. Package B which includes an annual fee of$2,000 was
added to accommodate the seller's annual expenditure ofta'l:es and insurance during the 3-year option. The
following is a recap of the offer and counter-offers as per the direction of the HRA commissioners.
.
Date
Purchase Price Option Fee
Purchase Price Increase
BRA
offer
9/2/98
$81,000
Seller counter- 10/14/98
offer
$86,000
HRA counter-offers:
Package A 10/14/98
$84,000
Package B
10/14/98
$81,000
.
3-year option.
Non-refundable
annual fee of$1,000.
Not applied to
purchase price.
4% annual increase
at anniversary date.
Cash buyout
1/1/1999.
3-year option.
Up-front $3,000
non-refundable fee.
Not applied to purchase
pnce.
4% annual increase
at anniversary date.
3-year option.
Annual fee of $2,000.
Annual fee disbursal of
$1,000 non-refundable
and $1,000 applied to
purchase price.
4% annual increase
at anniversary date.
fb/\
Monticello City Hall, 250 E. Broadway, PO Box 1147, Monticello, MN 55362-9245. (612) 295-2711. Fax: (612) 295-4404
Office of Public Works, 909 Golf Course Rd., Monticello, MN 55362 . (612) 295-3170 . Fax: (612) 271-3272
.
.
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Mrs. Otten
Page 2
October 23, 1998
c
The HRA counter-offers were subject to a legal opinion on the requirements of relocation benefits.
Should you have additional questions, please do not hesitate to call me at 271-3208. The next HRA meeting
is scheduled for 6:00 p.m. on November 9, 1998. Ifpossible a response to the HRA counter-offers in writing
would be appreciated for distribution to the commissioners on November 5. The BRA looks forward to
hearing from you and thanks you for your time. Deb, again, my apology.
Sincerely,
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF MONTICELLO
Q)~ \~(J)\J~~
Ollie Koropchak
Executive Director
c: HRA File
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RECAP 218 FRONT STREET OFFER
Package A
$84,000 - 3-year option
Up-front $3,000 non-refundable fee.
Not applied to purchase price.
4% annual increase at anniversary date.
Price at anniversary date:
Year 1 - $87,360
Year 2 - $90,854.40
Year 3 - $94,488.58.
Package B
$81,000 - 3-year option
Annual fee of $2,000.
Annual fee disbursal of
$1,000 non-refundable and $1,000
applied to purchase price.
4% annual increase at anniversary
date.
Price at anniversary date:
Year 1 - $84,240
Year 2 - $87,609.60
Year 3 - $91,113.98 less applied fee of
$3,000 = $88,113.98.
The annual fee of $2,000 was to assist the
seller with upfront holding expenses of taxes
and insurance, a concern of the seller.
Murray's point was long term over 3 years
better deal for seller. 1998 Taxes $821.89.
Assesssments $369.21 delinquent utility bills
and compose fee.
RELOCATION BENEFITS
Dan Wilson, relocation consultant. No maximum amount for residential.
Rental property - two ways to fill gap:
1. Find comparable house, pay difference between existing rent and new rent times 42
months.
2. If tenants have low to moderate income, rent can not exceed 30% of income. Find
comparable house, pay difference between new rent and 30% of income times 42
months. Example: If the gap were $300 monthly times 42 months is $12,600.
Dan suggested a budget of $5,000
q;?J
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November 4, 1998
Debbie Otten
7183 Cahill Ave NE
Monticello.;.M;N. -m.62
To the HRA for the City of Monticello:
Lam..writingto..inform)101.L-Of.~ de~i(!ion to.;:t~~ept your.offer.of.Qctober -14, 1998
regarding the real estate property at 218 Front Street.
'The....offer-Lam acceptine i~ Pa~kRep. A:-Pllr~h;:t~p. price $84,OOQ,.with.a-3. yp.;:tr op~on and
an up-front $3,000 non- refundable fee, not to be applied to the purchase price, with a
purrh;:t ~e pricain~rease..of4-o/o..anm I~ llYOll.tbe..anniv~ D.ateoc thi c;: trans.,8ction.
'.
Please have the HRA attorney prepare the documents and notify me.
Sincer~ly:
~~
Debbie-M.Otten.-for-Michael O'Connor~ Owner _
~/\
D8c-02-98 lO=07.m From-KENNEDY & GRAVEN
+6123379310
T-B56 P.OZ/03 F-55Z
470 l'Jl$b...ry ~ter
200 SOlltb Sar.b Street
MinnC"J.pofu MN 55402
(612) 337.9300 tl:kphooc:
(612) 337.9310 fax
c:-m;;,j. :mys@lu'IUltUt""Sl',"Vl:n.com
D~IEL J. G!u:J;:~SiWJ:IG
Artumc:)' "ll.aw
011'111:1 0l~1 (612) 337-9231
d11:l1J d~/'e~llswc:IJ.:GI.l:l\no::dY'~/1.vell.c()m
December 2, 1998
Ollie Koropchak
CIty Hal!
P.o. Box] 147
Monticello, MN 55362
Dear Ollie:
You asked for a brief ~planation of when relocanon assistance would be required if the
Monticello BRA entered intO an option agreement to acquire propeny within the city. It is my
understanding that the propeny in qu.estion is currently occupied by a tencmt on a month-to-
month lease.
.
Under Minnesoti1 law, which generally follows the federal statutes and regulations on which it is
bas~d, relocation assistance is requited for persons displaced as the reswt of a. public body's
"acquisinon" ofpropeny. Minnesota Statutes. Section 117.50. For pw-poses of state-mandated.
relocation assistance, acquisition by a public body means that the body "obt=rins full right to use
the propeny as its own." Gilliland v. POlT Authorir.v of the City of Sr.. Paul, 270 N.W.2d 743,
746 (Minn. 1978).
In other words, the BRA is required ll.> pay relocation assistance when a person is displacc:d
because the HRA has obtained. control over a piece of property. An option does not by itself give
the BRA the right TO control the properry to which the opnOJl penains; if the lIRA never
exercised the option, the HRA would never have any control over the use of the property at alL
Instead, the option only gives the HRA the right to do something in the fulur~ which will give it
,0ntrOl over IDs; propeny. Thus, tht: liRA is not reql.1ireu to pay relocation assistance sImply
because it has entered into an option agreement.
.
When the liRA ~;\c;rcises the option, however, it WIll obtain control over the propeny and
becomca liable for any relocation assistance required to be paid by law. Keep in mind that me
liRA will be required to mak~ this assistance available as long as the displacement of the tenant
OCC\.lfS Cl.S the resu.lt of the HRA's acquIsition. This means that the HRA cannot avoid providing
assistance s1II1ply by having the current ha,mllord give notice of lease leonina.tion to the tenant; if
the lease is terminated at the BRA"s request, or in anticipation or because of the HRA's exercise
of its purchase option, the HRA wOl.1ld b~ responSIble for relocation costs to the extent required
by law. I expect that Dan Wilson could give you a relatively reliable estimate as to the COSl in
this partIcular case
DJC.154311
MN19o.1
\/<;
D8c-OZ-98 lO:07am From-KENNEDY & GRAVEN
+61Z337931o
T-B56 P.03/03 F-552
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Olh" Koropchak
Octo\:lcr 30, 1998
Page 2 of 2
1 hope that this addresses your question. If you need any funher information. please let me
know.
Daniell. Grecnswcig
djglpar
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HRA Agenda - 12/9/98
9.
Consideration of a request to discuss the use/rental of the HRA 2:aral;e located at
220 Front Street.
A. REFERENCE AND BACKGROUND:
Enclosed is a letter from Attorney Peterson who represents Rich and Marian Carlson
relating to the purchase of the property located at 225 Front Street. You will note the
Carlson are interested in use/rental of the HRA garage. In November 1997, the HRA
offered the use of the HRA garage at no fee and at no liability as part of an option to
purchase the Carlson property in the amount of$130,000. The offer was not accepted.
Certainly, any use of the garage is at no liability to the HRA and all debris must be
vacated upon 30-day written notice from the HRA. Ifthe HRA is interested in collecting
rent, a storage agreement with the monthly fee would be most appropriate. Since it is
assumed the rent collected would be a minimum amount, this would not change the
property tax status of tax exempt.
I believe storage rental begins at about $20-50 monthly for small areas. Boat storage can
receive $20 per foot. Certainly, this garage can not be considered as a secure place for
storage. The square footage is 396 sq ft (18 x 22).
B.
ALTERNATIVE ACTION:
1. A motion allowing the Carlson's use the garage without a fee with a 30-day
written notice to remove all debris.
2. A motion entering into a storage agreement at a monthly fee of
3. A motion of no interest to accommodate the request of the Carlson's to use/rent
the HRA garage.
4. A motion to table any action.
C. RECOMMENDATION.
If the HRA has interest to accommodate the Carlson's request, it is recommended a
monthly fee be established and a storage agreement executed.
D. SUPPORTING DATA.
Copy ofletter from Carlson's attorney and HRA minutes of November 5 and December
3, 1997.
-9-
JOHNSON, LARSON, & PETERSON, P.A.
ATTORN S AT LAW
+Reol Property Low Specialist
Certified by Minnesota State Bar Association
.
JAN C. LARSON+
JOHN T. PETERSON+
JUHL S. HALVORSON
CINDI S. MATT
October 29, 1998
Ms. Ollie Koropchak
City of Monticello
P.O. Box 1147
250 East Broadway
Monticello, MN 55362
Re: Richard and Marion Carlson Property/Purchase Agreement
Dear Ms. Koropchak:
.
My clients have contacted me concerning the offer extended by the City during the City
Counsel's October meeting, offering to pay the sum of $500.00 to the Carl sons for a Right of
First Refusal on the property. My clients appreciate the offer, but decline to accept same at this
point in time. Based upon attorney's fees they have incurred to date, coupled with future
attorney's fees in the review and examination of any Right of First Refusal Agreement, when
compared to the $500.00 sum offered by the City, it would not be cost effective to them at this
time to accept such an offer.
My clients have also asked me to follow-up on an offer made by the City during formal
discussions occurring in October of 1997. At that time, the City had offered the Carl sons the use
of the City garages located across the street from their property. The Carlsons would like to
pursue this matter further, and discuss the use/rental of the City garages for the purpose of storing
additional property that they have which was previously stored in their garage, which as you are
aware, they no longer have. For the purpose of discussing use and rental by the Carlsons of the
City's garages located across from their property, I would ask that you contact the Carl sons
directly. However, any further discussions relating to the purchase of the Carlson property
should remain directed to this office. Thank you.
May I remain,
CV'\
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JTP:mar
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HRA MINUTES
NOVEMBER 5, 1997
9. Consideration to review for discussion the first draft of an action plan endorsing the
council vision and policies.
Brad Barger made a motion to table this item tor the December 3 HRA agenda. Darrin
Lahr seconded the motion and with no further discussion, the motion passed unanimously.
10. Consideration to authorize payment ofHRA monthly bills.
Brad Barger made a motion authorizing payment of the regular BRA montWy bills and
authorized disbursal ofthe October 13 Hoisington invoice of$15,895.97 subject to
approval by the MCP for satisfaction of work and completion. Bob Murray seconded the
motion and with no further discussion, the motion passed unanimously.
II. Report by Executive Director.
E)
*
Report was accepted by the commissioners. Departure time to the NAHRO conference
was changed from 7:15 to 7:00 a.m.
Consideration to review appraisals for properties located at 225 West River Street and
225 Front Street for potential acquisition.
a) 225 Front Street - Commissioners compared the appraisal value of$165,000 to the
estimated market value of$125,600. The land appraised at $75,000. Frie agreed the
property was unique because ofit's location on the river. However, he felt the appraisal
did not have comparable sales of properties on the river and the appraisal1isted the
property outside the flood plain. Frie gave an example of a West River Street property
consisting of 1,500 sq ft and two lots which sold for $129,500. A new home was build on
the second lot and the original home and lot was resold. Murray felt the roof should be
inspected by a structural engineer. Other members agreed Carlson's insurance should
cover the roof damage. Barger felt this property was key to the redevelopment of the
river and downtown; however, he noted the taxpayer's money must be spend wisely.
Darrin Lahr made a motion to offer an "option to purchase" in the amount of$130,000 as
is for the property located at 225 Front Street. Purchase Option to expire in five years,
the HRA has the right to exercise the option within the five years with a six-month notice
to the seller to vacate. An annual payment of$I,OOO does not apply to the purchase price.
HRA garage located at 220 Front Street is available to the seller at no fee and at no
liability to the BRA. Bob Murray seconded the motion and with no further discussion,
the motion passed unanimously.
6
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HRA MINUTES
DECEMBER 3,1997
Q)
Consideration to accept the Purchase Option between the BRA and Carlsons. 225 Front
Street.
With no response from the sellers, Richard and Marian Carlson; Steve Andrews made a
motion to table any action until the January 7, 1998 HRA meeting. It was noted the use
~Ofthe garage at 220 Front Street should coincide with the life duration of the 225 Front
. Street purchase option. The use of the garage means in its "as is" condition. Darrin Lahr
seconded the motion and with no further discussion, the motion passed unanimously.
9. Consideration to accept the Purchase A2reement between the BRA and Hawkins. 225
West River Street.
With no response from the seller, Irwin Hawkins; Steve Andrews made a motion to table'
any action until the January 7, 1998 HRA meeting. Darrin Lahr seconded the motion and
with no further discussion, the motion passed llmmimously.
10.
Consideration of a presentation on the potential redevelopment of the southwest corridor
and the realiillment of West Oakwood Drive.
.
Steve Johnson representing the Monticello FordlMercury dealership informed HRA
members that the car industry today is very focused and with the growth of the local
dealership comes the need to expand on or near the present site. He continued with a brief
history of the dealership stating in 1977, Larry Flake relocated the dealership from its
West Broadway location. Two years ago, Peterson planned to remodel and expand the
facility from 15,000 to 35,000 sq ft as the dealership tripled its sales of new cars out~
selling three metropolitan dealers. However, the current site is a little less than 5 acres
and a 10-acre site is ideal for expansion. The dealership has leamed it will lose its direct
access via West Oakwood Drive and Highway 25 with the new 1-94 easterly exist and
enter ramps. The dealership's new access is proposed via the alignment of proposed West
Chelsea Road and Highway 25 and then right on Sandberg Road. Lastly, the dealership
was hit with two ti1il1ion dollars of damage to vehicles and property with the July 1997
storm.
The dealership needs the property to the south for expansion and accessibility. The
dealership is attempting to negotiate a land sale with the owners of the Hart Clinic
building; however, the Clinic appears not interested in a quick turn-around time continued
Johnson. An appraisal of the property has been obtained. The State is negotiating with
the dealership via an appraisal of the value ofthe closed access. Johnson requested the
lIRA serve as a facilitator to assist in retaining the dealership at its present location
perhaps to facilitate the procurement ofthe land or utilizing its power of condemnation.
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5
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10.
HRA Agenda - 12/9/98
Consideration of a request to extend the deadline for execution of documents
relatiDl! to proDosed Project No. II within RedeveloDment District No. 1-22.
A. REFERENCE AND BACKGROUND:
In July, the HRA approved up-front TIF assistance in an amount not-to-exceed $150,000
for the acquisition and demolition costs associated with the redevelopment of the West
Broadway Amoco station, subject to execution of an Assessment Agreement and
execution of a Contract for Private Redevelopment between the BRA and Shingobee on
or before December 31, 1998 and subject to Council approval of $150,000 loan to the
HRA for up-front financing.
Shingobee continues to work with the medical and other professions to secure
preliminary lease interest or agreements; however, at this time no agreements are in place.
Shingobee request the HRA extend the deadline date of December 31, 1998 for three
months or to March 31, 1999. It appears sufficient tax increment is generated to retire
the debt service of $150,000 NPV with the one-year delay of construction.
B. ALTERNATIVE ACTION:
1.
A motion to extend the deadline date from December 31, 1998, to March 31, 1999
for execution of an Assessment Agreement and Contract for Private
Redevelopment between the HRA and Shingobee and subject to Council approval
for a $150,000 loan to the HRA for up-front financing.
2. A motion to deny the request for an extension of the deadline date of December
31,1998.
3. A motion to table any action.
C. RECOMMENDATION:
As sufficient tax increment is generated to retire the debt service and the proposed project
truly meets the test of a Redevelopment District, recommendation is Alternative No.1.
D. SUPPORTING DATA.
Copy of HRA minutes of July 1, 1998 and projected tax increment.
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HRA MINUTES
JULY 1, 1998
the HRA Attorney and the Executive Director. Dan Frie seconded the motion and with no
further discussion, the motion passed unanimously.
6. Consideration to approve general guidelines and level ofTIF' assistance for project no. II
within Redevelopment District No. 1-22.
Greg Hayes, Shingobee, Inc., informed HRA members that the need for the $150,000 up-
front TIF assistance still stands for redevelopment of the West Broadway Amoco station.
Upon a clearer definition as to the context of an Assessment Agreement which is a
recordable document between the developer, lIRA, and County Assessor agreeing to a
certain minimum market value, Hayes indicated Shingobee's willingness to provide an
assessment agreement with a minimum market value between $540,000 to $560,000 for
land and building. An Assessment Agreement does not include a tax increment guarantee.
W olfsteller inquired as to the amount of the local contribution for Redevelopment District
No. 1-22. Bubul responded the local contribution for a redevelopment district is 5% and
said dollars pledged and contributed from the City's General Fund for development ofthe
Community Center are qualified costs for the local contribution.
Dan Frie made a motion approving up-front TIF assistance in an amount not-to-exceed
$150,000 for the acquisition and demolition costs associated with the redevelopment of
the West Broadway Amoco station, subject to execution of an Assessment Agreement and
execution of a Contract for Private Redevelopment between the HRA and Shingobee on
or before December 31, 1998 and subject to Council approval of a $150,000 loan to the
HRA for up-front financing. Darrin Lahr seconded the motion. HRA members requested
the City Council review the 5% local contribution for TIF District No. 1-22 for
clarification of qualified costs and to re-affirm their previous commitment. With no
further discussion, the motion passed unanimously.
7.
Consideration of a counteroffer for the property located at 225 Front Street.
HRA members received copies of the letters between John Peterson, attorney for Rich and
Marian Carlson, and the HRA and a copy of the Option Agreement and Purchase
Agreement offered by the BRA in November 1997. With no request from the property
owners, no action was necessary.
8. Consideration to review the first draft of the proposed TIF guidelines.
HRA members elected to table this item until all commissioners are present.
3
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DEC 07 '98 10:43AM EHLERS & ASSOCIATES
12104r.la Monticello ~: 1.000 s.f. EluMdlng al7"..
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El'lIera an" /<$s<lclales. Inc.
CITY OF MONl'lCEI,LO, MINN&SOTA
T,l.l", CASH FLOW ASSUMl'TIONS
'ay 97 Fl'Qze!'l RIlle
l!'lteresl Rale
Tax Eld$!'Islon RatE::
l!'Illation Rlto:
PIN
1" 55-0 1 0.0:36130
155-0'O.o~6140
Tol.~1
BASE VALUE INFORMATION
Mar\l.Ol Cla9$
.value Flal8 "._'
19,100 2.45%1:3,5'Y.
86,400 g.~5%/3.5%
105,5<12--...._. ..
7.000%
1.12
0.0000%
Tax
CaDaclty
468
_~,117
z~es
PROJEc.... V AUJE INFORMATION
Type o' Tal( Incremenl District Fledllvelopmenl
Type of Development O'lice
Numtlar o16uildinQ square Feer. 8,000
Estimated Market Vallie 01 New Project
Cia>> Rate on firs1 $150,000 of Market Value
Class RalS Marlcet valUe> $'50.000
Estimated Tax Capaoity:
E$1lmaled TUlIa:
A&....o~. Market Valu./a.l.
Tax,"d.
2,45""
3.~0%
540,000
17,325
19,404
S67,50
$2,43
P,2/3
,~ E.s1lmallSd Pay 98 Tax CapaellY
pay 00
Pay 00
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Page' Amoeo:1..i<4
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l~~fC 07 '98
10:43AM EHLERS & ASSOCIATES
M.n~...II. HIlA: 9.000 U Iluildillg at ,.,.
P.3/3
ccry OF MONTICELLO, MINNESOTA
TAX INCREMENT CASH FLOW
6a:;e Project Captured SemI-Annual Admin. Seml:-Arin'iia'i 100,00% L.oeal Years
peRIOD BeGINNING Til~ Tax Tax Gross Tex at NetTa~ 01 cumul. Mateh af 01 PERIOD ENDING
Yrs. Mm. Yr. caP-!lP.!Y .. Qpa.city c.~e~c!.tY. IncTememl 10.000/0 Incrllment Increment Nl"V ~.00% Incremenl YTS. M\I'I. Yr.
0.0 08.01 1999 2,585 2,565 0 0 0 0 0 0.0 0.5 02.0f 2000
0.5 02.01 2000 2,585 2.585 0 0 0 0 0 0 0,0 1,0 08.01 2000
1.0 08.01 2000 0 0 0 0 0 0,0 1,5 02oQ1 2001
1.5 02-01 2001 2,585 11,325 14,740 8.2SS (82S) 7.429 7,429 8.474 413 0.5 2.0 08.01 2001
2.0 08.01 2001 8,255 (925) 1,429 1.429 12.129 011:3 1.0 2.5 02.01 2002
2.5 02-01 2002 2.585 17.s25 14,740 8.255 (825) 7,-429 7,42; 18,n3 413 1.5 3.0 os-o 1 2002
3,0 08-01 2002 8,255 (825) 7,4.29 7.429 24,812 413 2.0 3.5 02.0 1 2003
3.5 02.01 2003 2.585 17.325 14.10\0 8,255 (825) 7,429 7,429 30,254 413 2.5 4,0 Oe-ol 2003
4.0 08,01 2003 8,2M (825) 7.429 7.429 35,705 413 3.0 4.5 02.01 2004
4.5 02.01 2004 2,585 17,325 14,740 8,255 (825) 7.429 '1.429 40.971 413 3.! 5.0 00-01 2004
5.0 08-01 2004 8,255 (825) 7.429 7,429 46.060 413 4.0 5.G 02,01 2005
5.5 02-01 2005 2,~85 17,325 14.740 e,255 (82S) 7,429 7,429 50,976 413 4,$ 6.0 09-01 2005
6.0 08-01 2005 11,2:5:5 (825) 7,429 7,429 55,726 413 5.0 e~ 02-(11 2006
8.5 02.01 2006 2.585 17.:325 14.740 9.255 (825) 7,429 7,429 60,316 413 5.5 1.0 08-01 2008
7.0 oa.Ol 2006 8.255 (825) 7.429 7,429 64,750 413 6.0 7.5 02.01 2007
7.5 02-01 2007 <l,585 17,325 14,740 8.255 (825) 7,429 7,429 60,036 413 6.5 8,0 08-01 2007
8.0 08.01 2007 B,255 (B2S) 7,429 7,429 73.174 413 7.0 II.S 02-01 2008
8,5 02.01 2008 2.585 17.325 14,740 8.255 (825) 1.429 7,429 77,174 .:If3 1.5 9.0 08-01 2008
9.0 08.01 2008 8.255 (825) 7.429 7,429 81,038 413 8.0 9.5 02.01 2009
9.5 02-01 200~ 2,~B5 17.325 14,740 e,255 (8~) 7,429 7,429 114,n2 413 8.5 10.0 08-01 2009
10.0 08.01 2001) 8.255 (a2S) 7,429 7,429 88,379 .413 9.0 10.5 02-01 2010
10.5 02.01 2010 2,585 17,325 14,740 8,2M (B2!) 7,429 7.429 91.864 413 95 ".0 08-01 2010
11.0 08.01 Z010 8,255 (825) 7,429 7.429 9G.232 413 10.0 11.5 02.01 2011
11.5 02.01 2011 2,585 17.m 14.740 8,255 (825) 7.429 7.429 99,485 413 10.5 12,0 08-01 2011
12.0 Oa.o1 2011 8,255 (825) 7,429 7,429 101,629 413 11.0 12.5 02-01 2012
12.5 02.01 2012 UaQ 17,325 14,740 8,2SS (82S) 1,429 7,42ll 104,666 413 11.6 13.0 08-01 2012
13.0 08.01 2012 8.255 (925) 7..29 7.429 101.601 .:113 12.0 13.5 02.01 2013
13.5 02.01 2013 2,585 17,325 14,740 8.265 (S26) M29 7.429 1100438 413 12.5 14,0 09.01 2013
14.0 08-01 2013 8...55 (825) 7,429 7,429 113,176 41:1 13.0 14.5 02-01 2014
14.5 02.01 2014 2.585 17,325 14.740 8.266 (8:25) 7.4211 ,. .42D 115,S22 413 13.5 f5.0 08-01 2014
15,0 08-01 2014 8.255 (825) 7.429 7,429 118,380 413 14.0 15.5 02-01 2015
15.5 02-01 2015 2,585 17,3:l5 14,740 8,255 (825) 7,429 7.429 120,851 413 14.5 18.0 oa.01 2015
16,0 oa-01 2015 U55 (825) 7,429 7,429 .w..aa 413 15.0 18.5 02-01 2018
16.5 02-01 2016 2,585 17.325 14.740 8,255 (825) 7.429 7,429 125,544 413 15.5 17,0 06-01 2016
17,0 08-01 2018 S,255 (825) 7,429 7,429 127,773 413 16.0 17.5 02.01 2017
17.5 02-01 2017 2.585 17,325 14.740 e,255 (B2~) 7.429 7,429 12!l.928 413 16.5 18.0 08-01 2017
16.0 OS.OI 2017 8,255 (825) 7.429 7,4.29 132.007 413 17.0 18.5 02.01 2018
18.5 02.01 2018 2.585 17.325 14.760 8,255 (825) 7.429 1,429 1:34,017 413 17.5 19.0 08.01 2018
19.0 08-01 2018 8.255 (825) 7,429 7,429 135,959 413 113.0 19.5 02.01 2Q19
19.5 02-01 2019 2,585 17,325 14,740 8,255 (825) 7,429 7.4211 137,835 413 18.5 20.0 08-01 20 19
20.0 06-01 2019 8,.2..'15 (825) 7,429 7,429 139,648 41:3 19.0 20.5 02.01 2020
20.5 02.01 2020 2,585 17,:325 14.740 8.255 (B25) 7,429 7,429 141,400 413 19.5 21,0 08-01 2020
21.0 08-01 2020 8.255 (825) 7,429 7,429 143,092 413 :20.0 21.5 02-01 20.21
21.5 02.01 2021 2,585 17.325 14,740 8,255 (825) 7,429 7.429 144,727 413 20.5 22.0 0a-01 2021
22,0 08-01 2021 8,255 (825) 7,429 7,429 146,307 413 21,0 22.5 02-01 202.2
:22.5 0.2-01 2022 2,585 17,325 14.740 8,255 (825) '.429 7.420 147,833 413 21.5 23.0 08-01 2022
23.0 08.01 2022 8"~~_~'7:._l~2~----LSi,--. 7 429 149.308 413 22.0 23.5 02-01 2023
---- Totals 383 200 311,320 328.11110 328.1180 ...." \ " ........-
Present Valll/)s 165,898 (1IU90> 149.308 149,30' ... u_ " . .. .""'a'~ ..--
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Enlers an" .-...od"IM, InC.
!'age 2 """'003,_
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11.
HRA Agenda - 12/9/98
Consideration of a request to re-schedule the date of the Januarv HRA meetine.
A. REFERENCE AND BACKGROUND:
The MCP Board of Directors request the HRA re-schedule their regular January meeting
date of Wednesday, January 13, 1999, to another date. The by-laws of the non-profit
organization, the Monticello Community Partners, states their annual meeting is to be
held the second Wednesday in January of each year. The Board is working hard to bring
in a speaker(s) of value and interest which relates to revitalization of the riverfront and
downtown. More importantly, MCP wants you, the commissioners, in attendance or
given the opportunity to attend.
Suggested alternative dates for the January HRA meeting are Tuesday, January 12 or
Wednesday, January 6 or 20, 1999.
B. ALTERNATIVE ACTION:
1. A motion to re-schedule theHRA January meeting from January 13, 1999 to
2.
A motion to hold the HRA January meeting at it's regular date of January 13,
1998.
C. RECOMMENDATION:
Recommendation is alternative no. 1.
D. SUPPORTING DATA:
None.
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12.
HRA Agenda - 12/9/98
Consideration to authorize payment of monthlv HRA bills.
Recommendation is to authorize payment ofthe monthly HRA bills.
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HRA Agenda - 12/9/98
13.
Consideration of executive director's reoort.
a) 3 Walnut Street - After placing one ad in the shopper, I received about a dozen
calls for the rental property. The house and garage has been rented to a Jeromie
and Tammy Hacker and their two small children. They would like to move-in
December 19 so I will pro-rate the December rent accordingly. The tenant pays
up-front the first and last month's rent and damage deposit of $500.
b) Summaries - Previously I had summarized the TIF District Plans for Nos. 1-1
through 1-18 and the respective Redevelopment Contracts for the purpose of
managing the plans and contracts and disbursing of funds. This past week, Nos.
1-19 through 1-25 were summarized. One more thing caught-up.
c) TIF District No. 1-20 - A check has been authorized for payment in the amount of
$32,500 to Cedrus Creek (John Komarek) per the contract as he has completed
three twin townhome units and one four-plex townhome unit within the TIF
District. A total of four twin townhome units and six four-plex townhome units
must be completed by December, 1999, within the district. A total of 30
townhome units must be completed by December 31,2002, within the project
area.
d)
TIF District No. 1-18 (River Mills) - I've checked with the County Auditor DarIa
Groschen's office on the status for certification for this district. Rod Bunting tells
me they will be looking into this matter after mailing tax notices. As you recall,
the city requested the county on March 21, 1995, to certify the district. The first
semi-annual disbursement was to commence August 1, 1998. The total amount
of pay-as-you-go assistance for soils correction is $102,000 without interest.
e) Wendy's property - An Attorney representing Wendy's was interested in TIF
assistance because from their prospective the building in obsolete. It is unlikely
the building would meet the requirements for establishment of the Redevelopment
District or meet the "but for" test. The current market value of the property is
$302,000 which would make it difficult to capture any increment but not
impossible. The Ford dealership is interested in acquisition ofthe property, there
appeared to be a large gap between the offer and the current mortgage. TIF was
not encouraged but he was offered the opportunity to make a presentation to the
HRA, he asked to speak with the HRA Attorney.
f)
Quik TIF - Mark Ruff of Ehlers will explain a Quik TIF computer program
developed by Ehlers to Kathy, Rick, and myself on Friday, December 11. The
program computes the district's revenues and expenses for preparation of the
annual TIF reports to the State Auditor.
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