HRA Agenda 11-01-1989AGENDA
MONTICELLO HOUSING AND RFDF,VFI,OPMF.NT AUTHORITY
Wednesday, November 1, 1989 - 7:OOPM
City Hall
MEMBERS: Chairperson Al Larson, Ben Smith, Lovell Schrupp,
Everette Ellison, and Tom St. Hilaire.
STAFF: Rick Wolfsteller, Jeff O'Neill, and 011ie Roropchak.
GUESTS: Pat Pelstring, Business Development Services, Inc.
Barb Schwfentek, Hospital Executive Director
1. Call to Order.
2. Approval of the October 4, 1989 HRA Minutes.
3. Consideration to Review David Ficek's Housing Redevelopment
Plan, Estimated TIF Project Numbers, and Survey Results.
4. Consideration of Discussion for Elderly Convalescent
Housing Needs.
5. Consideration of an Update on the Gills Property.
6. Other Business.
7. Adjournment.
MINUTES
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
Wednesday, October 4, 1989 - 7:00 PM
City Hall
MEMBERS PRESENT: Chairperson Al Larson, Ben Smith, Everette Ellison,
Tom St, Hilaire, and Lowell Schrupp (late).
STAFF PRESENT: Jeff O'Neill and 011ie Koropchak
GUEST: Pat Pelstring
1. CALL TO ORDER.
Chairperson Al Larson called the HRA meeting to order at
7:25 PM.
2. APPROVAL OF THE SEPTEMBER 6, 1989 HRA MINUTES.
Ben Smith made a motion to approve the September 6, 1989
HRA Minutes, seconded by Everette Ellison, the minutes
stand approved as written. Vote 4-0.
3. CONSIDERATION TO HEAR AN UPDATE OF THE G1LLE PROPERTY.
Jeff O'Neill reported to the HRA members that upon city
attorney advise and HRA support, continued enforcement
of the City Ordinance (illegal use of an existing non-
conforming use) has been applied within reason. At
this time no report has been received from the PCA
or EPA regarding the time frame for development of a
PCA plan for abandon tank removal. The HRA suggested
the city staff consider the possibility of consulting an outside
attorney who specializes in areas of environmental issues
in business operations and commercial transactions.
This with Mr. Tom Hayes acknowledgement.
4. CONSIDERATION TO REVIEW THE AGREEMENT BETWEEN THE HRA
AND BDS, INC.
Mr. Pat Polstring acknowledged that the original contract
between the HRA and HIS, Inc. provided marketing services
at no coat to the HRA. The initial contact and the pre-
paration of proposals will not be charged no originally,
however, once the prospect visite the community BDS will
request payment for efforts in structuring and completing
the financing. The HRA would retain BDS on an hourly
basis at $75 par hour, or on a negotiated fixed -fee basis
for prospect presentations and financial packaging. The
City/HRA could bill the services back to the benefitting
company. Sao Page 2 Section I -B. in the agreement. The
HRA may want to provide a latter to proceed to BDS, Inc.
HRA Minutes - 10/4/89
Page 2
4. CONTINUED.
Ben Smith noted that of page 4 Section 3 of the agreement
should include on a timely basis. Tom St. Hilaire made
a motion to approve the Agreement between the Monticello
Housing and Redevelopment Authority and Business Development
Services, Inc. with the noted above correction. Everette
Ellison seconded the motion and passed unanimously. The
HRA approved payment of services to BDS.
5. CONSIDERATION TO REVIEW DAVID FICEX'S HOUSING REDEVELOPMENT
PROJECT AND SURVEY RESULTS.
Mr. Pelstring advised the HRA that Mr. Ficek has been ill
for the last several days therefore a new proposal has not
been prepared for the HRA'a review. Mr. Pelstring also
informed the HRA that Mr. Fieek has not received his
financing for the Princeton project.
6. CONSIDERATION TO HEAR TIF CONCEPTS AND PRELIMINARY APPROVAL
FOR THE USE OF TIF:
Mantaq International, Inc. - A research and developemnt firm
from Midland, Michigan proposing a 30,000 eq ft building with
approximately 50 employees. TIF use would reduce the lease
rate by $1.00 per square annually. The use of TIF is built
into the proposed finance package as prepared by BDS.
Tappor, Inc. - A wood cabinet manufacturer with a proposed
approximate 30,000 sq ft building and potential of 50
employees. TIF use for write down of land cost and other
determined improvement costs. The use of TIP is built into
the proposed finance package as prepared by BDS.
Remmolo Engineering - a supplier of high quality, tochnolog-
ically advanced services proposing a minimum of a 25,000-
30,000 aq ft building with an approximate 50 cmployeos.
TIP use for write down of land cost and other determined
improvement costs. The use of TIF Is built into the
proposed finance package as prepared by BDS.
Cardinal IG - specialitaa in a patented insulating glass
process and supplies 652 of their product to Andorsen
Cvryu&aLluu. Proposed 135,000 aq ft facility with an
approximato 150 employees. TIF use would reduce the
lease rata by 70 cents per square foot.
The HRA concensus was for preliminary approval of TIF
concept use for the four industrial companies.
7. CONSIDERATION TO REVIEW CITY COUNCIL TIF DISTRICT FOR
SEVENTH STREET ALIGNMENT AND EXPANSION.
The HRA members wars concerned by sithor the accuracy
NRA Minutes - 10/4/89
Page 3
7. CONTINUED.
of newspaper reporting or the accuracy of conveying HRA
recommendations to the City Council or newspaper. The
HRA members recalled leaving the meeting with a good feeling
because their recommendation was to have the developer
purchase the Pratt and Holthaus properties and put in
the straight line street improvements. The end result
to the taxpayer was subsidized in the area of $70,000
to $100,000. The cost for demolition, relocation, and
assessing process were not clearly defined to the HRA.
The paper reported the HRA approval of an approximate
$235,000 TIF use for the project. Mr. O'Neill expressed
that he may have overstepped his administrative powers
for the City in his recommendation to the City Council
on September 11, 1989. The HRA recommendation of
September 6 only included the use of TIF for the
purchase of the Kraemer property.
A special HRA meeting was held September 14 to receive
HRA approval of the City Council's proposed TIF plan and to
authorize the development of the finance plan. The Sept. 11th
City Council's motion was TIF assistance of $238,250,
City $42,885 and The Lincoln Companies 0134,000 contingent upon
the approval of the HRA, if no HRA approval the road
alignment would revert back to the curved road alignment.
The City Council TIF proposal was the results of a
negotiated proposed plan between BDS and the city staff.
The HRA saw very little public benefit and made a motion
relinquishing the determination for the use of TIF to
the City Council with the recommendation that the
benefitting parties acquire the land and be assessed
for Seventh Street improvements of which the NRA
recommended the straight alignment to Minnesota Street,
and the HRA recommended that the Kraemer property not
be acquired at this time as the Seventh Street improvement
demands to the west of Minnesota Street will be determined
by the property development and market. In summary the
HRA recommended no use of TIF for the project.
Mr. Chuck DuFroeno of the Lincoln Companies was present
but did not present Lincoln Companies proposed use of
TIP.
City Council approved the use of TIP and authorized a TIP
plan be drafted for presentation to the School District
and County Commissioners for a total project cost of
$588,300: TIP $298,563, City $53,741, and Lincoln Companies
$191,025. Tho September 25 approval include purchase of
the Kraemer. Holthaus, and Pratt property; related demolition
costs+ and a portion of the Seventh Street improvements
HRA Minutes - 10/4/89
Page 4
S,
7. CONTINUED.
for TIF use. The Lincoln Companies cost included purchase
of a portion of the Holthaus property, on site ponding cost, and
San/St sever costs. The City portion included the resale of
the Kraemer property less Hornig's assessment.
A couple of HRA members expressed their thoughts of possible
resignation from the BIG because of the inaccurate newspaper reports and
staff recommendations. They were concerned that city staff
really wanted this project to go. The BRA has always
supported a K -Mart coming to Monticello, however,
did not see the use of TIF to support a private developer,
The Lincoln Companies. The approved TIF use was the beet
alternative as negotiated between the Lincoln Companies, city
staff and council.
8. OTHER BUSINESS.
None.
9. ADJOURNMENT.
Everette Ellison made a motion to adjourn the HRA meeting,
seconded by Ban Smith, the meeting adjourned at 8:30 PM.
a Kne %S� �
011ie Koropchak
NRA Executive Secretary
/ALTERNATIVE 5 ADOPTED FINANCE PLAN -9/25/89
STRAIGHT ALIGNMENT - CITY FINANCES ALIGNMENT COST AND "CITY" PORTION OF
SEVENTH STREET CONSTRUCTION COST
]SOURCES
TOTAL ]TIF LINCOLN LINCOLN HORNIG
USES ] ASSESS ASSESS
I
SEVENTH STREET $151,000 I $66,063 $0 $56,625 28.313
LAND VALUE $0 1 $0 $0 $0
EXCESS LAND $0 i $0 $0 $0 $0
PRATT $61,000 I $61,000 $0 $0 $0
HOL.THAUS $49,900 I $38,500 $11,000 $0 $0
KRAMER <1187.000*�$117,000 $0 $0
SAN/ST SEWER $84,000 1$84:000 $0 $0
ON-SITE PONDING $39,400 ] $0 $0
DEMO/RELOCATICN $16,000 1 $16,000 $0 $0 $0
TOTAL COST $588,300 1$298.563 $134,400 $`6,625 1:8,313
HOLTHOUSUWD CITY TOTAL
ASSESS SALE ASSESS
PROCEEDS
$0
$0 $151,00:
$O
$0 T
$0
$0
$0
$0 $61.011.
$0
$0 34SI7,;
$0 $70.000
$0 $187,::'
$0
$0 $84,DC.
$O
$0 $39 .., '
$0
EO $16",
$0 $70,000 $0 $587, -'-
ACTUAL CITY COST (18%) $53.741
ACTUAL LINCOLN COMPANIES COST $191,025
....................... ........ •........... ...........
SV �
The
Lincoln
Companies
840 E. Wce Street, Suite 200 Am
waynts, Minnesota 663:11
V1 2)476-0000
ax: (612) 476-0086
September 21, 1989
Mr. Jeff O'Neill BY FAX
Assistant City Administrator
City of Monticello
250 E. Broadway
Monticello, MN 55362
Ret Monticello Mall/K Mart
Dear Jefft
I enjoyed the opportunity to address the Monticello Planning Commission
regarding several important issues pertaining to the K Mart development.
Their support was very encouraging. That's the type of support that
makes an owner such as myself want to keep fighting the fight to make the
Monticello Mall/K Mart project work.
The numbers I would like you to provide the city council regarding the
public improvements and purchase of additional land for future
developments are the numbers enclosed with Chuck's September 13th
letter. In addition to our strong belief that these are public purpose
improvements, our project cannot withstand any additional costa. The
project's feasibility would become doubtful, due to modifications in plane
and final pricing with additional project costs. This project cannot even
support a development fee to our company which is the first time this has
ever happened. The existing mall continues to lose money each month
which puts further strain on the project.
We feel very strongly that the costs in question, in which we have agreed
to participate, are of a public purpose nature extending beyond the scope
of our project. I would like to recommend that the council approve the
financing structure as we proposed subject to staff working with us to
verify the project's inability to absorb additional costs.
a);
Mr. Jeff O'Neill
September 21. 1989
page two
The K Mart is an opportunity for everyone if it is built. Should it be
built. the success of the mall remains a risk for us. I look forward to
attending the upcoming city couch meeting and working with all concerned
so a project that should happen can happen.
ery trulq
yours.
Thomas P. DuFresne
President
TPD:sko
rNA-1
Sep 13,89 11:07 THE LINCOLN COMPANIES
100TICILL0 TIP SOUICI/Ott AI11,161t
SOURCES 6110061 WIPINIIS IOINIC TIP LAND WI CITY TOTAL
COITll1UT101 PIOCISDS
Isn
ITS 111111
161,000.00
1.10
10,600.00 171,500.00 0.00
1.01
151,000.00
Putt
$1,000.00
15,600.00
1.00 11,600.00 1.00
1.00
11,000.00
IOL11A01
61,000.00
10,000.00
1.00 76,000.00 0,00
1.00
51,000,00
114111
117,000.00
0.01
1.00 111,000.01 10,000.00
0.0
117,000.00
SA11TAIT 11111 A
14,000.01
0.10
1.00 14,000.01 1.00
1.10
14,000.00
Tupoul1 P010110
71,100.01
0.00
0.00 71,400.00 0.00
1,00
71,400.00
TOTAL
111,400.00
46,100.00
10,100.00 411,100.01 70,000.00
1.00
611,400.00
ACTUAL LIICOW
C017A1111 00"
114118 of eettlballd 14,400.01
Led
Lied 14te6ue 46,600.00
Total 109,000.00
1t? CITY Cot?
TII 1,11 11,111.00
P.0 iU.
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I AW 40.41 Y Alu WOA114 Mae- ,et c r
GENERAL INFORMATION
IWe am pleased to announce anexpanded seriesofworkstmps
designed especially fat citizen planners. Participants will
enhance their knowledge of various areas Mplenning and- as
a result. became boa equipped to make recommendations
and decisions about the communities in which they live.
program features Ittdude:
• Specialized topics for those new to land use plasming as
wellas fortbose familim with the basics andbeyond
• An accomplished faculty with extensive backgrounds in
bah pLvming and instruction
•
Timely prescmau mfocusiagmcurremissuesandinfo•-
rrtation
• Packets of handy reference materials designed to make
your job easius
V you would like to make your contribution to solving land
use problems as informed and effective as pos-
sible..JtEGtSTER TODAY!
WHO SHOULD ATTEND?
Members ofplmmuugcommissions,boardsofad st meat/ap-
peals and gover rag bodies in Minnesota cities, canoes and
townships. Also valuable for members of otter advisory
commissions. housing and redevelopment autboritim staff
without degrees in planning, and real estate professionals.
CATALOG SCHEDULE
This catalog provides worls6op descriptions and regisuadon
forms forpmgrams scheduled from November, 1989 through
May. 1990.
REGISTRATION/CANCELLATION
Register an hast 10 days prior to the workshop date ming the
farms insured in this catalog. Fill out one form for each
workshop. If you need more forms, duplicate those included
or eau GTS. A full refund will • r" only Ir ugag
�t� Is ..nwll.vr 7 ingi ion ndv mer, of hemnomm,
Substin— for registered paNcipanla may be made at any
time. Should inclement weather (or other cucumstan=
beyond our eonuol) necessizate pogrom cancellation or
postponement. registrants will be notified via an-
nouncements on WCCO mdto and other local radio stations.
REAL ESTATE CREDIT
Participants of'Annual Planning Institutes• ard'Beyo d the
Basics" can cam Continuing Real Estate Education Credits.
The number of hours for each pn*= are iruticated in this
catalog.
W41OUSE PROGRAMS
Government Training Service can customize any workshop
in this catalog especially for your comrnunityl
You choose the topics. dam and location. Call us for more
infommtion.
Considering a goalaetting session for your governing body
or commission? GTS can provide trained facilitates who
have extensive experience working with local govemmemx
like yours!
NOTE: GTS welcomes your ideas for other workshops that
would be valuable for your jurisdictions.
CO-SPONSORS
• Association of Metropolitan Municipalities
• Association OfMinnesota Counties
• Humphrey Instiane of Public Affairs
• State Planning Agcy
• League of Minnesaa Cities
• Mimxmm Chapter, Americo Planning As
• Minamo M iation o(Townships
• Mitm moa Planning Association
FURTHER INFORMATION
ComactLisa DuBois (Registration) or Vivian Hart(Program)
atGovermmentTraining Service 612872-7409 or Minnesota
Toll Free 800/652.9719
About hover MOnt TMWttg Servlee (OTS)
GTS is a public organization whose mission is
to mat due changing management and leader-
ship mods of policymakers, staff and
appointed officials by providing innovative.
comprelretuive, practical training and consulting to publicly
fmiledoganimtions.
SpmW Work*A g
AoC0121P Shing Your Agenda
A workshop for members of advisory boards, torn -
missions aced owuninem "Accomplishing Yaw
Agteadlt" trill belp you WO codWentm anti oust
within your CoMMirerA=n-
Pasliffnen" promdum
"Potiiatnentary procedure. From Principles to
Pmcdce" isaoompmbendve work assioathat will
look at the basic priadpks for using padiameamry
procedure.
(Sn pep 7 d9his cloft fd unto 6110)
USING TAX INCREMENT FINANCING: A SHORT COURSE
Tax increment financing has been called "the
TAX INCREMENT FEYANCING
single most important tool"for encouraging and
AGREEMENTS
directing economic development. Designed to
Relibonshtmodel �
plan•
P
help participants determine its practicality for
d PaoTlF
Coodltionsmdpsttraades
their situation and implement it as appropriate,
Rist tom= liabilities
this workshop looks at the specifics of whar's in-
volved as well as the current controversies
11:00 noon LUNCH
regarding its use.
1:00 Pm
PASTICURRENT USES OF TTF
8:00a.m. REGISTRATION
Overview
• Case studies prondod by tial gomoment
8:30 DEFINITIONS AND BACKGROUND
presemm
9:00 DEVELOPM A PLAN
2:30
BREAK
• What it is
• Purpose
L45
THE CONTROVERSIES
• What it includes
Alleged abases
���
How much s too much?
' Spending when you ge en m
DEVELOPING GUIDEL04ESI
POLICIESPROPOSED
LEGLSLA710N AND
BMPLICAT ION&
10.00 BREAK
Phan and Counterpoint
IONS FINANCING OPTIONS/
4:00
QUFS'RONSA.NDANSWERS
REQUIREMENTS
(faculty Pte)
Wha• am
• How m decade
to
4:70
ADJOURN
• Who to involve
• Legal issues
CORE FACULT11
JOHN KHtBY, Partner. Dorsey G Whitney
ANDREA LUBOV. Development Policy AnaiysL League of Mianesota Cities
DAVE MACGH.LIVRAY. Vice President. SOngtmd Public Fiamrce Adviso
SENATOR EMBER REICHGOTT. District 46
JOHN SHARDLOW, Vice Pnddem. DaWpm. Shardlow and Ube. Inc.
QATEAQGAIM
Wednesday. February 7, 1990
Daym Inn MWncq olis North
1501 Freeway Blvd.
Brooklyn Cater, MN 55430
617/566-4140
Ell
The S65 per pmou reghualon includes laneh. rohedsmem breab and ha dous maroML
W-GISTRATION FORM
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—
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