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Ed102703.docCITY OF NEW HOPE 4401 XYLON AVENUE NORTH NEW HOPE, MINNESOTA 55428 EDA Minutes October 27, 2003 Regular Meeting City Hall CALL TO ORDER President Enck called the meeting of the Economic Development Authority to order at 7:41 p.m. ROLL CALL Present: W. Peter Enck, President Sharon Cassen, Commissioner Don Collier, Commissioner Mary Gwin-Lenth, Commissioner Steve Sommer, Commissioner APPROVE MINUTES Motion was made by Commissioner Collier, seconded by Commissioner Sommer, to approve the Regular Meeting Minutes of August 25, 2003 . All present voted in favor. Motion carried. IMP. PROJECT 727 President Enck introduced for discussion Item 4, Resolution relating to the Item 4 decertification of a parcel from tax increment financing district no. 02-01 (improvement project no. 727). EDA RESOLUTION Commissioner Collier introduced the following resolution and moved its adoption 03-08 “RESOLUTION RELATING TO THE DECERTIFICATION OF A PARCEL Item 4 FROM TAX INCREMENT FINANCING DISTRICT NO. 02-01 (IMPROVEMENT PROJECT NO. 727).” The motion for the adoption of the foregoing resolution was seconded by Commissioner Gwin-Lenth, and upon vote being taken thereon, the following voted in favor thereof: Enck, Cassen, Collier, Gwin-Lenth, Sommer; and the following voted against the same: None; Abstained: None; Absent: None; whereupon the resolution was declared duly passed and adopted, signed by the president which was attested to by the executive director. IMP. PROJECT 749 President Enck introduced for discussion Item 5, Discussion and update regarding Item 5 development proposal for city-owned property at 5501 Boone Avenue North and direction to proceed with financial/tax increment financing analysis (improvement project no. 749). Mr. Ken Doresky, Community Development Specialist, stated on June 23, 2003, the EDA expressed support for a project with Project for Pride in Living (PPL). He reviewed the actions that have taken place since June. PPL hired Maxfield Research to conduct a market study for the proposed development. The study concluded that demand is sufficient to support the proposed condominiums. Also, the study suggested that PPL split the project into two buildings, one ownership and one rental which they have done. In addition to the separate buildings, PPL has also modified the unit mix. The site plan has been changed to a condominium development with 41 units and a rental building with 35 units. Also as a result of the market study, four-bedroom condominium units have been eliminated in favor of fewer bedroom units. And based on EDA comments of June 23, PPL has added six additional ownership units. The number of rental units has remained the same. PPL has submitted funding applications to the Minnesota Housing Finance Agency, Hennepin County HOME, Federal Home Loan Bank and the Metropolitan Council for the rental portion of the site. On September 8, 2003, the Council approved a resolution of support for the Met. Council Predevelopment Grant Application. New Hope EDA October 27, 2003 Page 1 Mr. Doresky noted that the city partially funded the original purchase of the property with CDBG funds. Staff has spoken with Hennepin County and learned that the proposed PPL project does qualify as a CDBG eligible use. Mr. Doresky reported that PPL has determined that the estimated cost of pilings for soil correction is $600,000 per building or $1.2 million. PPL has requested that the city consider the use of tax increment financing as an additional funding source to help defray the soil correction costs. PPL has agreed to pay the standard financial analysis deposit used to pay consultant fees. President Enck inquired whether the tax increment financing request is for both buildings. Mr. Doresky responded affirmatively. Mr. Steve Kramer, Executive Director of PPL, was recognized. He announced that PPL was successful in the latest competitive MHFA Super RFP round. PPL has received an allocation of tax credits from the MHFA for the proposed development. President Enck questioned whether the proposed project for 5501 Boone would ever be tax exempt since PPL is a non-profit organization. Mr. Kramer clarified that the property would remain on the tax rolls. Discussion ensued regarding the necessity of an on-site caretaker or manager. President Enck pointed out that the on-site manager attributed to the successfulness of the PPL project at 7610 Bass Lake Road. Mr. Kramer introduced Mabruka Abdisamad, manager of the Bass Lake Court Townhomes, and stated Mabruka will also manage the rental properties for 5501 Boone. He stated the 5501 Boone property will have an on-site caretaker. The condominium owners would select a professional management company. Mr. Steve Sondrall, City Attorney, stated the condominium association would operate similar to a townhome association. Mr. Dan Donahue, City Manager, was asked to comment on the tax increment financing district issue. Mr. Donahue stated he believes the EDA can either modify the existing district to include the 5501 Boone property or the EDA could create a separate TIF district. Mr. Chris Wilson, PPL Project Manager, was recognized. He pointed out that the buildings have been re-oriented so that they face each other with the pond between them. He commented on the projected number of units and the condition of the soils. He noted construction could begin next year. Mr. Wilson also commented that additional parking was added to the site plan to accommodate Minnesota Masonic Homes/North Ridge if they desire to rent parking space from PPL. He indicated if it is determined that North Ridge will not utilize the parking, the plan will be revised to reflect green space rather than parking space. Commissioner Collier inquired whether a children’s play area/equipment is planned for the site. Mr. Kramer responded affirmatively. MOTION Motion was made by Commissioner Sommer, seconded by Commissioner Cassen, Item 5 to proceed with the financial/tax increment financing analysis relating to the development proposal for 5501 Boone Avenue North . All present voted in favor. Motion carried. IMP. PROJECT 754 President Enck introduced for discussion Item 6, Motion authorizing staff to meet Item 6 with representatives of Bear Creek Capital and property owners of 7901 Bass Lake Road and 5539/5549 Winnetka Avenue to negotiate potential property acquisition for redevelopment purposes (improvement project no. 754). Mr. Kirk McDonald, Director of Community Development, stated at the EDA meeting of August 25, 2003, the EDA reviewed correspondence from Bear Creek Capital and CVS/Pharmacy regarding their continued interest in the sites at the New Hope EDA October 27, 2003 southwest quadrant of Bass Lake Road and Winnetka Avenue. Bear Creek had Page 2 requested that the city retain a qualified appraiser to complete appraisals on the three properties, at the expense of the developer. The EDA approved moving forward with the proposal. The developer submitted the appropriate fees to the city and over the past several months, Shenehon Company completed the appraisals. Capital and CVS/Pharmacy regarding their continued interest in the sites at the southwest quadrant of Bass Lake Road and Winnetka Avenue. Bear Creek had requested that the city retain a qualified appraiser to complete appraisals on the three properties, at the expense of the developer. The EDA approved moving forward with the proposal. The developer submitted the appropriate fees to the city and over the past several months, Shenehon Company completed the appraisals. When the appraisals were completed, city staff and the city attorney met with the developer to review the appraisals and discuss the next appropriate steps. It was the consensus of the developer and city staff/consultants that the next recommended step would be for both the developer and city representatives to meet together with each individual property owner to determine their interest in cooperating on a potential redevelopment project. Staff is requesting authorization to assist with the coordination of such a meeting and to participate with the developer in a negotiation meeting. The purpose of the meetings with the property owners at 5539/5549 Winnetka and 7901 Bass Lake Road would be to determine if the properties could be acquired on a willing seller basis or not and to emphasize the city’s interest in seeing this potential redevelopment project move forward. The results of those meetings would be brought back and presented to the EDA to determine the future action steps. Commissioner Sommer inquired whether staff time would be at the developer’s expense. Mr. McDonald stated typically the city charges developers for billable consultant time but not for city staff time. He projected a total of two hours (one hour per meeting). Commissioner Sommer noted the discussions may be futile if the school district does not wish to sell any of its property. Mr. McDonald stated staff has shared the proposal and plan with the superintendent of ISD 281. He stated although it is too early to determine whether the project will require school district property or not, he does not believe the school district is adverse to working with the city. He stated additional information regarding the site size will be revealed upon completion of the storm water analysis. MOTION Motion was made by Commissioner Gwin-Lenth, seconded by Commissioner authorizing staff to meet with representatives of Bear Creek Capital Item 6 Collier, and property owners of 7901 Bass Lake Road and 5539/5549 Winnetka Avenue to negotiate potential property acquisition for redevelopment purposes (improvement project no. 754) . All present voted in favor. Motion carried. ADJOURNMENT Motion was made by Commissioner Sommer, seconded by Commissioner Cassen, to adjourn the meeting . All present voted in favor. Motion carried. The New Hope EDA adjourned at 8:14 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA October 27, 2003 Page 3