HRA Agenda 01-03-1990AGENDA
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
Wednesday, January 3, 1990 - 7:OOPM
City Hall
MEMBERS: Chairperson Al Larson, Ben Smith, Lovell Schrupp,
Everette Ellison, and Tom St. Hilaire.
CITY STAFF: Rick Wolfateller, Jeff O'Neill, and 011ie Koropchak.
GUEST: Bob Heck and Deb Graham, BDS, INC.
Bill Tapper and Lance Hartkopf, Tapper Inc.
1. CALL TO ORDER.
2. APPROVAL OF THE DECEMBER 6, 1989 HRA MINUTES.
3. PUBLIC HEARING FOR THE DISPOSITION OF LAND FOR TIF
DISTRICT NO. 1-9.
4. CONSIDERATION TO APPROVE THE RESOLUTION RELATING TO THE
MODIFICATION OF THE REDEVELOPMENT PLAN RELATING TO
REDEVELOPMENT PROJECT NO.1, THE MODIFICATION OF THE TAX
INCREMENT FINANCING PLANS RELATING TO TAX INCREMENT
FINANCING DISTRICTS NOS. 1-1 THROUGH 1-8 AND THE
APPROVAL AND ADOPTION OF THE TAX INCREMENT FINANCING
PLAN RELATING TO TAR INCREMENT FINANCING DISTRICT NO. 1-9.
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S. CONSIDERATION TO AUTHORIZE BDS, INC. TO DRAFT A TIP PLAN
FOR ESTABLISHMENT OF ECONOMIC DISTRICT NO. 1-10 FOR
TAPPER, INC.
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6. CONSIDERATION TO HEAR TIF PROPOSAL PRESENTED TO
BRIDGE WATER TELEPHONE COMPANY.
7. CONSIDERATION TO ELECT 1990 HRA OFFICERS AND TO ESTABLISH
1990 HRA GOALS.
8. CONSIDERATION OF AN UPDATE ON REMMELE ENGINEERING AND
THE LINCOLN COMPANIES.
9. OTHER BUSINESS.
10. ADJOURNMENT.
MINUTES
MONTICELLO HOUSING AND REDEVELOPMENT AUTHORITY
Wednesday, December 6, 1989 - 7:00 YM
\' City Hall
MEMBERS PRESENT: Chairperson Al Larson, Everette Ellison,
Ben Smith, and Tom St. Hilaire.
MEMBERS ABSENT: Lovell Schrupp.
STAFF PRESENT: 011ie Roropchak
GUEST: Pat Pelstring, BDS, Inc.
Russ Martie, TIF Applicant
1. CALL TO ORDER.
Chairperson Al Larson called the HRA meeting to order at
7:15 PM.
2. APPROVAL OF THE NOVEMBER 1. 1989 HRA MINUTES.
Ben Smith made a motion to approve the November 1, 1989
BRA minutes, seconded by Everette Ellison, the minutes
stand approved as written.
3. CONSIDERATION TO REVIEW THE USE OF TIF AND BUILDING
PIANS FOR THE RUSS MARTIE PROJECT.
Mr. Martie presented the HRA with preliminary plana for
his proposed commercial display/cold storage structure
in Oakwood Industrial Park. Plans include a 7,128 sq
it metal structure of which 2.268 sq ft are for
commerical display/offico and 4,860 aq ft are for
cold storage with the commerical sales display to the
north and storage/loading dock to the vest and cast.
Mr. Martic has a contact for deed on the property
and has completed grading with elevations two feet
above Dundee Road. The retail products consists
of pat supply. Cargill supplies, grass seeds, power equipment, seed
corn, salt, wood shavings, grains, etc. His present
location along Highway 25 is 4,400 sq ft with a
lease expiration of May 1, 1990.
When asked by HRA members if the project would proceed
without TIF assistance, Mr. Martie indicated the project
would go on without TIP assistance, "Yes, it has to." The
number of new jobs is two. Additionally, Mr. Martis
indicated that during harvest months the facility may be
used for grain cleaning.
Estimated projections showed a max up -front TIF assistance
of $11,000 over 8 years for write-down of land. The HRA
was concerned about their policy of assistance for non-
competitive commerical businesses which previously has
RRA Minutes - 12/6/89
Page 2
y 3. CONTINUED.
been used for assistance of public improvements assoicated
with a project. Secondly, the HRA was concerned about
the aesthetic view of the industrial park which has been
noted by recent potential new industries.
The RRA asked Hr. Mettle about the potential of constructing an additional
48 feet to the storage area or an increase of 2,592 eq ft
to building project, as Mr. Martie had in earlier discussion
indicated as a potential option. Mr. Martie responded
that the payback would be good and would further increase
jobs by two part-time yearly employees. With the additional
2,592 sq ft storage area to increase the ratio of warehouse
for agricultural products compared to commerical display area, increase of
EHV, and with the further increase of two part-time yearly
employees, Mr. Pat Pelstring suggested the HRA consider
the pay-as-you-go TIF option for Mr. Martie, as Ruse
indicated financing wasn't a problem, at an assistance
level of $2,500 annually over 7 years or total of
$17,500. Tho HRA further recommended proper screening for
the storage and outside storage areae to reserve the
industrial park aesthetic value. Under this analysis, Mr.
Pelstring viewed this as a small good project which works
well for both the HRA and Mr. Martie and assists a
local small business to expand through the use of a cash
flow TIP option.
Everette Ellison made a motion authorizing Mr. Pat Pelstring
to draft a TIF Plan for distribution to the school district,
hospital, and county commission by December 22, 1989, author-
izing an HRA public hearing date for the disposition of
land on January 3, 1990. The TIF plan to assist the developer
with the pay-as-you-go option of $2,500 annually for seven
years or a total of $17,500 for land write down based on
a total 9,720 aq ft metal building of which 2,268 aq ft comm display/offic,
and 1,452 sq ft warehouse for agricultural products. Additionally,
proper screening must be placed in the storage and outside
storage areae to reserve the industrial park aesthetic value.
The motion was seconded by Tom St. Hilaire and passed 4-0.
4. CONSIDERATION TO REVIEW THE DAVID FICEK'S REDEVELOPMENT PROJECT.
Mr. Polstring informed the HRA of the meeting rosults between
Mr. Ficek, Koropchok and himself which had outlined the HRA
recommendation for no rental/inventor unite in Phase I and
the concern of property owner contact by Mr. Ficok. Mr.
Ficak'e initial request for TIF assistance was projected at
$350,000-$400,000. However, preliminary numbers ran by
BDS, Inc. Indicated at assistance in the area of $250,000.
-7
After the meeting between Pelstring. Ficok, and Koropchak;
Jerry Shannon ran preliminary numbers based on all unite
in Phase I and II on class rate for rasidental home-
stead property, although the Phrase II was anticipated
HRA Minutes - 12/6/89
Page 3
4. CONTINUED.
as rental/investor unite by the developer. The level of assistance
with the completion of Phase I and II as of January 2, 1992 was
up -front $250,000. Projected increment beginning 1993 is $32,482
annually. Any excess increment from rental classification rate
could be used as a pay-as-you-go option to the developer.
Mr. Pelstring recommended Planning Commission revieval for the
multi -family rental unite in Phase II and recommneded the HRA
not execute the Letter of Intent until Mr. Ficek has met
Yith the property owner for potential willingness to negotiate
a land sale and establish developer's costs.
The HRA recalled their original concept and objective of this
project to eliminate blight and create quality townhouse (ownership)
housing for the elderly (55 or above but not limited to)
in Phase I site location.
Mr. Pelstring felt Mr. Ficek would still remain interested in
the project with TIF assistance of $250.000 for Phase I and II own-
er occupied unite, however , he would be disappointed.
Tom St. Hiliare made a motion recommending Phase I and II be owner
_
occupied and the level of TIF assistance to be the $250,000 up -front
option, this to be more consistent with the HRA's original project
VG
concept. Everette Ellison seconded the motion and without further
discussion the motion passed 4-0.
5. CONSIDERATION OF AN UPDATE AND REVIEW FOR THE USE OF TIF FOR
THE REMMELE ENGINEERING PROJECT.
Roropchak updated the HRA on the proposed Remmelo project:
initial 20.000 sq ft with 50 employee (semi -skilled and
skilled) with footings for a total 60,000 sq ft building
anticipated within 3 to 5 years and an additional 100
jobs. If a Hunticullo site location is picked they
would use TIF pay-as-you-go option. Competitive site
locations are Elk River and Big Lake. A December decision
Is expected.
Tapper. Inc. is planning for a December decision on their
proposed 20,000 eq ft 5suilding with 5.000 motxanine and
50 jobs. They proposed level of assistance would he the
TIP up -front option. The HRA is on record as preliminary
TIF assistance concept approval for the two above named projects.
Cardinal 1G will present to their Board of Directors in January
1990 for approval to extpend or relocate their West Lake Street
Plant thereafter will Fir. Renato Lixardo precede with site
1/
locations.
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BRA Minutes - 12/6/89
Page 4
6. CONSIDERATION OF AN UPDATE AND DISCUSSION OF THE POSSIBLE
1a PURCHASE OF THE GILLE PROPERTY.
This item appeared on the HRA agenda because Mr. Gills contacted
Roropchak inquiring of the HRA's interest to purchase his
property located on West County Road 75 (Zoned R-2). One
parcel is approximately 2.6 acres with an asking price of
$90,000 and the second parcel of approximately 1.2 acres
with an asking price of $80,000. Mr. Gille would grant
the HRA permission to enter his property for soil testing.
Previously, the HRA had advised Mr. Hayes, Jeff O'Neill, and
Gary Anderson to continue enforcing the City Ordinance
(illegal use of a non -conforming use). Mr. Pelstring
informed the HRA that his estimate of HRA excess increment is
$400,000.
The HRA views the Gills property as a liability and not as an
asset because of the underground storage tanks and possible
soil contamination. Because of no interested developer and
time being in favor of the BRA, Al Larson made a notion to
table the item and requested City staff and Mr. Hayes continue
enforcing the City Ordinance. The motion continued that
upon the HRA receiving a certification letter from Mr. Gille
stating that the property was no longer a liability
(underground storage tank and soil testing completed) the
HRA would then consider assistance with marketing the
property. The motion was seconded by Everette Ellison
and with no further discussion passed 4-0.
Prior to the motion, Mr. Peletring had suggested the HRA
consider providing TIF assistance for one-half the soil
testing costs or $2,500 and assist with marketing the
property or offer assistance to a now developer.
7. CONSIDERATION OF HRA MEMBERS FOR HRA APPOINTMENTS FOR THE
YEAR 1990.
Ben Smith made a motion recommending to the City Mayor for
Council approval the following HRA members and their expiration
term dates.
Dan Smith December 1990
Tom St. Hilaire December 1991
Everette Ellison December 1992
Al Larson December 1993
Lovell Schrupp December 1994
Everette Ellison seconded the motion and without further
discussion passed 4-0.
NRA Minutes — 12/6/89
Page 5
B. OTHER BUSINESS.
None.
9. ADJOURNMENT.
The BRA meeting adjourned at 9:15 PN.
011ie Roropchak, NRA Executive Secretary
Councilmember introduced the following
resolution, the reading of which was dispensed with by unanimous
consent, and moved its adoption:
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE
CITY OF MONTICELL40
WRIGHT COUNTY
STATE OF MINNESOTA
RESOLUTION NO.
A RESOLUTION RELATING TO THE MODIFICATION, BY
THE HOUSING AND REDEVELOMENT AUTHORITY IN AND
FOR THE CITY OF MONTICELLO, OF THE
REDEVELOPMENT PLAN RELATING TO REDEVELOPMENT
PROJECT NO. 1, THE MODIFICATION OF THE TAX
INCREMENT FINANCING PLANS RELATING TO TAX
INCREMENT FINANCING DISTRICTS NOS. 1-1 THROUGH
1-8 AND THE APPROVAL AND ADOPTION OF THE TAX
INCREMENT FINANCING PLAN RELATING TO TAX
INCREMENT FINANCING DISTRICT NO. 1-9, ALL
LOCATED WITHIN REDEVELOPMENT PROJECT NO. 1.
..L
BE IT RESOLVED by the Commissioners (the *Commissioners*) of
the Housing and Redevelopment Authority (the "Authority") in and
for the City of Monticello, Minnesota (the "City"), as followsi
Section 1. Recitals.
1.01. It has been proposed that the Authority modify, by
increased project costs, Redevelopment Project No. 1, pursuant to
and in accordance with Minnesota Statutes, Sections 469.001 to
469.067, inclusive, as amended. It has been further proposed
that the Authority modify, by increased project costa, the Tax
Increment Financing Plans relating to Tax Increment Financing
Districts Nos. 1-1 through 1-8 and establish Tax Increment
Financing District No. 1-9 and approve and adopt the Tax
Increment Financing Plans relating thereto, all located within
Redevelopment Project No. 1, pursuant to and in accordance with
Minnesota Statutes, Sections 469.174 to 469.179, inclusive, as
amended.
U14
J 1.02. The Authority has investigated the facts and has
caused to be prepared a proposed Modified Redevelopment Plan (the
"Modified Redevelopment Plan•) for Redevelopment Project No. 1,
defining more precisely the increased project costs to be made to
Redevelopment Project No. 1, the proposed Modified Tax Increment
Financing Plans for Tax Increment Pinancing Districts Nos. 1-1
through 1-8 and Tax Increment Financing Plan (the "Tax Increment
Financing Plan") for Tax Increment Financing District No. 1-9
(collectively referred to as the "Plans").
1.03. The Authority and the City have performed all actions
required by law to be performed prior to the modification of
Redevelopment Project No. 1, the modification of Tax Increment
Financing Districts Nos. 1-1 through 1-8 and the establishment of
Tax Increment Financing District No. 1-9 and the adoption of the
Plans relating thereto.
1.01. The Authority hereby determines that it is necessary
and in the best interest of the City at this time to modify
Redevelopment Project No. 1, to modify Tax Increment Financing
Districts Nos. 1-1 through 1-8 and to establish Tax Increment
Financing District No. 1-9 and approve the Plans relating
thereto, and to request that the City Council (the "Council")
hold a public hearing relating to the above -stated matters.
Section 2. Aeproval of the Modified Redevelopment Plan for
�{ Redevelopment Proiec t No. 1.
2.01. Subject to the finding, determination, and approval of
the Modified Redevelopment Plan for Redevelopment Project No. 1
by the City Council of the City, the Modified Redevelopment Plan
for Redevelopment Project No. 1 is hereby approved by the
Commissioners of the Authority. The increased project costs
shall be described in the Modified Redevelopment Plan for
Redevelopment Project No. 1 approved in Section 1 hereof.
Section 3. Approval of the Tax Increment Pinancinq Plans for
Tax Increment Financ ino Districts No. 1-1 through 1-9.
3.01. Subject to the finding, determination, and approval of
the Modified Tax Increment Financing Plane for Tax Increment
Financing Districts Noe. 1-1 through 1-8 and Tax Increment
Financing Plan for Tax Increment Financing District No. 1-9 by
the Council of the City, the Tax Increment Financing Plans for
Tax Increment Financing Districts Nos. 1-1 through 1-9 are
hereby approved by the Commissioners of the Authority.
Section 4. Approval of the Respective Plans.
4.01. The Plans presented to the Authority on this date, are
hereby approved and adopted by the Authority and shall be for-
warded to the Council with the request that the Council hold a
public hearing relating to the adoption of the Plans for
Redevelopment Project No. 1 and Tax Increment Financing Districts
Nos. 1-1 through 1-9.
Section 5. Disposition of Public Lands.
5.01. The Authority held a public hearing, as of this date,
regarding the disposition of public lands. The Authority hereby
verifies that said public hearing was held and duly authorises
the City Attorney and City staff to proceed with the implementation
of the necessary documentation relating to said disposition of
public lands.
Section 6. Filing of Plans.
6.01. The Authority shall cause the Plans, all as approved
and adopted, to be filed with the Office of the Minnesota
Department of Trade and Economic Development.
Dated January 3, 1990
140� Chairman
Attests
Executive Director
(SEAL)
7
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y
�f Cir 3/1989
HOUSING AND REDEVELOPMENT AUTHORITY
v
City of Monticello
TAX INCREMENT FINANCING POLICY
Program Purposes 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 HRA will analyze and evaluate Tax
Increment Financing proposals based upon the following policy
considerations. Each project shall be measured against these
considerations and the project's value shall be determined, based
upon meeting these considerations.
(1) The project shakll be consistent with the City's
Comprehensive Plan.
(2) The project shall demonstrate long-term economic and/or
housing benefits to the community.
(3) The project shall create and/or retain employment for
Monticello residents.
(C) The project shall increase moderate priced housing
options for area residents.
(9) The project shall facilitate the redevelopment or
elimination of "substandard" or "blighted" areas as
determined by the ARA.
(6) The project shall facilitate the "clean-up" of
environmentally unsound property.
(7) The project shall provide additional public funding
for public improvements including utilities and/or
park development which would not otherwise be available.
(8) The project shall be deemed to promote additional
desired 'spin-off" development.
POLICY GUIDELINES
(l) Tax Increment Financing will be considered for use in
economic development, redevelopment and specialized
housing projects. The standard level of assistance for
� projects shall be as follows:
S
TAX INCREMENT FINANCE PROPOSAL
CITY OF MONTICELLO
on behalf of
BRIDGE WATER TELEPHONE COMPANY
ASSUMPTIONS: 12,000 sq ft metal storage facility.
Concrete floor and 16 foot sidewalls
Block 1, Lot 6, Oakwood Industrial Park
Second Addition, 1.4898 acres or 64,895.68
square feet. Zoned I-2.
PID# 155-060-001060 EMV Payable 1990 $7,100
SIF District certified in 1990, increment collected
1992.
12,000 sq ft @ $8.00 - $96,000
64,895 sq ft @ .35 - 22,713
EMV $118,713
A. New Capacity Value $4,263.00
B. Original Capacity Value 372.00
C. Captured Capacity Value 3,891.00
W
D. 1989 Capacity Rate .82091
E. Annual Tax Increment $3,194.16
F. Tax 8111 $3,499.53
G. Adjusted Annual TI $3,078.50
CONCLUSION: The HRA could assist Bridge Water Telephone Company
with the pay-as-you-go option in a sum of up to
$22,000 for relocation of their service facility
from West County Road 39 to Block 1, Lot 6, Oakwood
Industrial Park Second Addition therabyo conforming
with the City Ordinance. Land cost of $20,000 and
developer's site improvement costs of $2,000.00
Bridge Water retains ownership of the property on
West County Road 39 contingent upon marketing and selling
the property to a PZ -M legal conforming use.
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