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1991 EDAApproved EDA Minutes Meeting #1 CITY OF NEW HOPE 4401Xylon Avenue North Hennepin County, Minnesota 55428 February 11, 1991 CALL TO ORDER ROLL CALL APPROVE MINUTES OECEMBER 27, 1990 FINAL SITE PLAN AUTOHAUS Item 4 President Erickson called the meeting of the Economic Development Authority to order at 8:00 p.m. Present: Erickson, L'Herault, Otten, Enck, Williamson Motion by Commissioner Otten, seconded by Commissioner Enck to approve the EDA minutes of December 27, 1990. Voting in favor: Otten, Erickson, Enck, Williamson; Abstained: L'Herault; Absent: None. Motion Carried. President Erickson introduced for discussion Item 4, Resolution Approving Final Site Plan for Autohaus Addition and Authorizing Autohaus Loan as Consistent with the Development Objectives of the 42nd Avenue Tax Increment Financing District (Project 467). Mr. Donahue stated the Autohaus Development contract and site plan were previously tentatively approved subject to specific changes being made to the site plan. A revised site plan has been submitted to the City which incorporates all the necessary changes required from previous approvals. It should be noted that the original site plan showed a "showroom and display area" in the front section of the building. Staff had requested that the site plan be revised to show that Universal Colour Lab is presently located there and that the area may be used in the future for showroom and display. Other changes involved increased landscaping, decreased sales area and front display area, and elimination of several parking stalls. The City Attorney has revised the Development Contract to show the private improvements the City expects to see made in consideration of the loan agreement. Achange has also been made to show that the storm water drainage improvements are public improvements which will become property of the City after their completion. A public hearing will be scheduled for the next Council meeting to authorize the sale of the animal hospital property to AutohaUs. New Hope EDA Page 1 February 11, 1991 New Hope EDA Page 2 Commissioner Enck pointed out that the Agreement to Raze incorrectly shows Autohaus of Minnesota rather than Autohaus of Minneapolis and asked that it be corrected. Mr. McDonald stated the major changes made to the plan include the reduction of a 15-foot display area in front of the building; the sales area was reduced to provide a snow storage area at back of the property; inaccessible parking spaces were eliminated; Universal Colour Lab is shown on the plan; and landscaping revisions. Mr. McDonald further stated that the Planning Commission requested additional landscaping at the westerly area between the school district and Autohaus. He explained that the request was for elimination of the Junipers and replacement with taller trees such as conifers or spruce for more effective screening. He noted that the plan shows arborvitaes will be planted. The EDA indicated approval of the arborvitaes plantings. Commissioner Enck inquired regarding the parking location for Universal Colour Lab employees. Mr. Tom Oestreich, representing Autohaus, responded that they will continue to park in the front of the building as in the past. He noted the parking area is specified on their lease agreement. Commissioner Williamson inquired of the length of the lease agreement with Universal Colour Lab. Mr. Oestreich stated he believes they are close to making final arrangements to relocate. He stated Universal Colour Lab has six months remaining on the lease. There is a 5-year option on the lease; however, at their last meeting, Universal Colour Lab did not elect to exercise the option. Commissioner Enck commented that what is requested for approval by the EDA is not the same as what is displayed in the site plan because Universal Colour Lab is still located in the building. Mr. Donahue stated language could be incorporated into the developer's agreement to address that aspect. Mr. Sondrall explained that the notation on the site plan serves that purpose by indicating the existing location of Universal Colour Lab. Essentially, what is being approved is the potential forAutohaus to expand its development to what is shown on t~e Site Plan. What the EDA should be aware of is that there is an option that Universal Colour February 11, 1991 New Hope EDA Page 3 Lab could remain in that building for 5-1/2 years. The site plan is a representation of what Autohaus would be allowed. Any other changes would be contrary to the development contract and the plan. Commissioner Enck pointed out that the notation only refers to the area inside the structure, but does not address where Universal Colour Lab employees will park. Mr. Sondrall stated the site plan could be modified to show how Universal Colour Lab will fit into this plan relative to the existing situation. Commissioner Williamson stated she does not feel it poses a problem. She noted the actual dimensions will not be changed and within six months the area currently being used as a parking lot will become the display area. Commissioner L'Herault stated the financial data for the loan was based upon front display area and how it related to potential sales. He inquired how much of an impact there would be if Universal Colour Lab decided to remain for another five years causing Autohaus unable to display vehicles in that area. Mr. Oestreich commented that since Autohaus has rented the property from Dr. Herman and has been able to display cars in that location, their "off-street" sales volume has increased from one percent to seven or eight percent and with the elimination of the animal hospital building they anticipate even higher sales. He commented that an increase to seven to eight percent is a conservative assumption. Mr. Donahue reiterated that language can be contained in the developer's agreement which points out that display area in front of the Universal Colour Lab will not be allowed while the property is leased by Universal Colour Lab. Mr. Sondrall concurred and stated the development contract and site plan can be tailored as needed. He commented that he felt it was necessary to include the notation on the site plan. Mr. Oestreich indicated Autohaus would agree to language indicating the front area will not be used for display area while Universal Colour Lab is a tenant. Mr. Sondrall commented that the site plan should actually show where the tenant parking is located so that it is clear and is in conformance with the development contract. February 11, 1991 Commissioner Enck pointed out that the parking area must adhere to the City Code's parking requirements relating to any structure. Mr. Sondrall stated he is unaware how it may affect the zoning code relative to parking but he knows Autohaus has 81 parking spaces and he is assuming it is in conformance with code. He indicated staff will review the situation and commented that if a number of those spaces are allocated to Universal Colour Lab, it may change the mix. However, by reducing the size of the existing building for Autohaus the number of needed spaces based on gross footage would also be reduced. The EDA discussed parking areas for vehicle display, customer parking, and employee parking. Mr. Sondrall stated the closing is tentatively scheduled for February 26. Commissioner Otten inquired whether Mr. Oestreich feels that in two weeks Universal Colour Lab would be in a position to give a definite decision regarding its relocation. He commented that if that decision is eminent, perhaps it would be best to table the item for two weeks. Commissioner Enck stated he is concerned that there is no restriction in the development plan regarding different tenants and if Universal Colour Lab moves out, Autohaus could choose to rent the building to a different tenant. Mr. Sondrall clarified that the development contract specifically states that the front of the building will be used either with Universal Colour Lab as a leasee or as display area for Autohaus. Mr. Tom Oestreich emphasized that Autohaus is anxious for Universal Color Lab to relocate and would not consider a different tenant. Mr. Sondrall asked Mr. Oestreich if he would guarantee that there would be no other tenant than Universal Color Lab. Mr. Oestreich responded, "Absolutely". President Erickson stated the amendment to the development contract should specify that there will be no outside parking of cars in front of Universal Color Lab until Universal Color Lab has actually left the premises. New Hope EDA Page 4 February 11, 1991 EDA RES. #g1-1 Item 4 ADJOURNMENT Commissioner Enck noted that his position remains the same and that he is not in favor of supporting the loan request based upon the possible adverse impacts. Commissioner L'Herault indicated he is in agreement with Commissioner Enck. Commissioner Otten introduced the following resolution and moved its adoption: "RESOLUTION APPROVING REVISED SITE PLAN AND AUTHORIZING AUTOHAUS LOAN AS CONSISTENT WITH THE DEVELOPMENT OBJECTIVES OF THE 42ND AVENUE TAX INCREMENT FINANCING DISTRICT". The motion for the adoption of the foregoing resolution was seconded by Commissioner Williamson, and upon vote being taken thereon; the following voted in favor thereof: Erickson, Williamson, Otten; and the following voted against the same: Enck, L'Herault; Absent: None; whereupon the resolution was declared duly passed and adopted, signed by the president which was attested to by the city clerk. Mr. Sondrall requested clarification of the motion. President Erickson explained that the EDA has adopted the resolution subject to amendment to the site plan and development contract. Motion made by Commissioner Williamson, seconded by Commissioner L'Herault to adjourn the EDA meeting as there was no further business to come before the Council. All present voted in favor. The New Hope EDA adjourned at 8:30 p.m. Sincerely, Val erie Leone City Clerk New Hope EDA Page 5 February 11, 1991 Approved EDA Minutes Meeting #2 CITY.OF NEW HOPE 4401Xylon Avenue North Hennepin County, Minnesota 55428 February 25, 1991 CALL'TO ORDER ROLL CALL APPROVE MINUTES FEBRUARY 11, 1991 SALE OF PROPERTY 7675 42ND AVE. N. Item 4 MOTION EDA RES. #91-2 Item 4 President Erickson called the meeting of the Economic Development Authority to order at 8:45 p.m. Present: Erickson, L'Herault, Otten, Enck, Williamson Motion by Commissioner Williamson, seconded by Commissioner Otten to approve the EDA minutes of February 11, 1991. All present voted in favor. President Erickson introduced for discussion Item 4, Resolution Authorizing Sale of Property at 7675 42nd Avenue to Autohaus of Minneapolis, Inc. (Project #467). Mr. Donahue stated this public hearing is scheduled regarding the sale of the Herman property to Autohaus. The property would be acquired by direct purchase, the existing structure would be razed, and the property would be incorporated with the Autohaus property in conjunction with expansion plans. Autohaus has agreed to purchase the property from he EDA in the amount of $140,000. The Council inquired of the closing date. City Attorney, Steve Sondrall, stated he does not believe a closing date has been scheduled. Mr. Tom Oestreich, representing Autohaus was recognized and stated there was an issue regarding possible soil contamination. Soil tests were taken and the test results came back favorable. The closing date is set for Tuesday, March 5, 1991. Motion was made by Commissioner Enck, seconded by Commissioner Williamson, to close the public hearing on consideration of the sale of the property at 7675 42nd Avenue North to Autohaus. All present voted in favor. Motion carried. Commissioner Enck introduced the following resolution and moved its adoption: "RESOLUTION AUTHORIZING SALE OF PROPERTY AT 7675 42ND AVENUE NORTH TO AUTOHAUS OF MINNEAPOLIS, INC." The motion for the adoption of the New Hope EDA Page 1 February 25, 1991 ADJOURNMENT foregoing resolution was seconded by Commissioner Otten, and upon vote being taken thereon; the following voted in favor thereof: L'Herault, Otten, Erickson, Enck, Williamson; and the following voted against the same: None; Absent: None; whereupon the resolution was declared duly passed and adopted, signed by the president which was attested to by the executive director. Motion made by Commissioner Otten, seconded by Commissioner L'Herault to adjourn the EDA meeting as there was no further business to come before the Council. All present voted in favor. The New Hope EDA adjourned at 8:50 p.m. Sincerely, Valerie Leone City Clerk New Hope EDA Page 2 February 25, 1991 Approved EDA Minutes Meeting #3 CITY OF NEW HOPE 4401Xylon Avenue North Hennepin County, Minnesota 55428 April 8, 1991 CALL TO ORDER ROLL CALL APPROVE HINUTES FEBRUARY 25, 1991 FOREMOST, INC. Item 4 President Erickson called the meeting of the Economic Development Authority to order at 8:50 p.m. Present: Erickson, Otten, Williamson Absent: L'Herault, Enck Motion was made by Commissioner Otten, seconded by Commissioner Williamson to approve the EDA minutes of February 25, 1991. All present voted in favor. President Erickson introduced for discussion Item 4, Consideration of Request by Foremost, Inc., for Economic Development Grant Program/Economic Recovery Fund Application. Mr. Donahue stated Foremost, Inc., 7825 42nd Avenue North, is interested in relocating and expanding their sheet metal fabrication business. They have encountered problems marketing their property due to the groundwater contamination problems generated by Electronic Industries and have requested economic development assistance from the City. Foremost has made three specific requests, one of which involves an Economic Development Grant Application through the Economic Recovery Fund. President Erickson stated the negotiations should be based upon what the value of the building is on the regular market with the existing problems. He recommended having an appraisal conducted indicating the value of the property if there was no contamination and what it is worth with the contamination. Mr. Donahue noted~that Foremost, Inc. has filed a suit against Electronic Industries for loss of property value. He stated through the state's Economic Grant Program the City may receive between $250,000 to $500,000 to administer in the form of a grant or a loan to Foremost for relocation. He stated the City is not committing to anything at this time. President Erickson stated applying for the grant appears to be the first step and he is in favor of it. New Hope EDA Page I April 8, 1991 MOTION ADJOURNMENT Motion was made by Commissioner Williamson, seconded by Commissioner Otten, directing staff to proceed with the grant application. All present voted in favor. Motion carried. Motion made by President Erickson, seconded by Commissioner Williamson to adjourn the EDA meeting as there was no further business to come before the Council. All present voted in favor. The New Hope EDA adjourned at 8:55 p.m. Sincerely, /- Valerie Leone City Clerk New Hope EDA Page 2 April 8, 1991 CITY OF NEW HOPE 4401Xylon Avenue North Hennepin County, Minnesota 55428 Approved EDA Minutes Meeting #4 April 22, 1991 CALL TO ORDER ROLL CALL APPROVE MINUTES FOREMOST, 'INC. Item 4 President Pro tem Enck called the meeting of the Economic Development Authority to order at 7:55 p.m. Present: Enck, L'Herault, Otten, Williamson Absent: Erickson It was the consensus of the EDA to defer approval of the April 8, 1991, minutes until the next EDA Meeting. President Pro tem Enck introduced for discussion Item 4, Consideration of Request by Foremost, Inc., for City to Share Cost of Drilling Test Wells to Determine Status of Contamination on Property (Improvement Project 474). Mr. Donahue stated the City has been discussing with Foremost, Inc. a possible economic development project for properties on 42nd and Quebec. He stated Foremost would like to request assistance in the cost of drilling test wells for soil samples to determine if there is contamination on their property. Mr. Donahue stated this information is essential before the property could be acquired and marketed by the City and is one of the items identified in the Planning Consultant's report that must be investigated if the City is interested in exploring redevelopment. President Pro rem Enck inquired whether the EDA would recover its expenditures. Mr. Donahue stated the majority of the tax increment monies would be recovered through two sources--I) if Foremost is successful on their lawsuit against Electronic Industries because of loss of value due to the contamination, and 2) if the City receives the grant from the State Economic Development Grant Program. Mr. Donahue informed the EDA of the risks involved with the project. He stated the City would have a financial risk of $15,000 (2/3 of $22,000) for the testing work. Mr. Donahue stated the application for the grant will be shared equally between Foremost and the City. Next, Mr. Donahue discussed the appraisal of the Foremost New Hope EDA Page i April 22, 1991 property and recommended that the EDA not share in the expense for the appraisal of the Foremost property. Commissioner Otten inquired of thecost for the appraisal. Mr. Steve Sondrall, City Attorney, stated the appraisal will be approximately $3,000. Mr. William Skolnick, Attorney representing Mr. Allen Fredendall and Foremost, Inc., was recognized. Mr. Skolnick introduced Mr. Allen Fredendall, owner of Foremost, Inc. at 7825 42nd Avenue North. He explained that Foremost employs between 35-40 people and desires to relocate and expand their sheet metal fabrication business within the City of New Hope. Mr. Skolnick clarified that the appraisal fee is $3,000 for the initial part of the appraisal and the total cost estimate is $7,000. He commented that after negotiations with the City regarding the appraisal, it was decided that Foremost would bear the entire cost for the appraisal. Mr. Skolnick stated the estimate obtained by Delta Environmental Consultants for the soil testing is $22,314. He requested that the City pay 2/3 of the cost and reported that Foremost would agree to reimburse the City for this assistance out of the proceeds of the lawsuit and/or any grant funds that would be forthcoming. He also indicated that Foremost will share half the cost of the grant application. He explained that financial institutions are not willing to refinance the property because of possible soil contamination. Mr. Skolnick pointed out that Foremost desires to relocate within the City and the City is interested in redeveloping the property on 42nd and Quebec. In order to accomplish this, certain questions must be addressed: a) whether there is contamination on the property, b) if there is contamination, to what extent; andc) the associated costs for clean-up. Mr. Skolnick stated he had just recently obtained information regarding the insurance policy of Electronic Industries. President Pro tem Enck requested a copy of the policies. Mr. Skolnickstated he would furnish copies to Mr. Sondrall if it does not violate confidentiality of Electronic Industries. Commissioner Otten inquired of the associated costs for the appraisal. Mr. Skolnick stated Foremost has elected to retain Peter Patchin as an appraiser due to his New Hope EDA Page 2 April 22, 1991 MOTION experience in valuation of real property when located next to or on a contamination problem. He explained that the appraisal will definitely cost $3,000 and could be as high as $7,000 depending on when a settlement is reached and if a final report is necessary. Commission Otten asked whether the proposed expansion will affect the number of employees at Foremost. Mr. Fredendall stated he is optimistic that when the economy picks up, so will his business. He explained that their present building is 24,700 sq. feet in size and is not adequate during peak business. He stated they previously leased space from 5101Hillsboro for 11 months. Commissioner Otten questioned when and if Foremost will decide to relocate. Mr. Fredendall explained that he decided long ago to relocate but has been unable to do so since lending institutions will not make loans because of soil problems and potentially large clean-up costs. The EDA and Mr. Skolnick discussed the pending lawsuit against Electronic Industries. Mr. Skolnick stated in addition to seeking damages for diminution of property, Foremost will be seeking reimbursement for costs of soil testing conducted west of Electronic Industries. He stated the Minnesota Pollution Control Agency will require Electronic Industries to clean up the property regardless of whether Foremost wins its lawsuit or not. In summary, Mr. Skolnick stated the City and Foremost have a common goal--the City would like to redevelop the area and Foremost would like to relocate within New Hope. Mr. Sondrall inquired whether Peter Patchin has given any indication as to an approximate amount of diminution of value in the Foremost property. Mr. Skolnick replied that he has not but in his own mind he feels it will be 30 to 40 percent. Mr. Skolnick stated Foremost is proceeding with the grant application and relocation and is not relying on proceeds from the lawsuit to get into a new site. Mr. Fredendall stated his only personal security is the business. Motion was made by Commissioner L'Herault, seconded by Commissioner Otten, to provide financial assistance of 2/3 of the costs not to exceed $15,000 for drilling test wells (utilizing tax increment monies) and to pay 1/2 the cost for the grant application. All present voted in favor. Motion carried. New Hope EDA Page 3 April 22, 1991 ADgOURNHENT Motion made by Commissioner L'Herault, seconded by Commissioner Otten to adjourn the EDA meeting as there was no further business to come before the Council. All present voted in favor. The New Hope EDA adjourned at 8:25 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA Page 4 April 22, 1991 Approved EDA Minutes Meeting #5 CITY OF NEW HOPE 4401Xylon Avenue North Hennepin County, Minnesota 55428 May 28, 1991 CALL TO ORDER ROLL CALL APPROVE MINUTES GETHSEMANE CEMETERY PROPERTY Item 4 New Hope EDA Page I President Erickson called the meeting of the Economic Development Authority to order at 7:50 p.m. Present: Erickson, L'Herault, Otten, Enck, Williamson Motion was made by Commissioner Williamson, seconded by Commissioner Otten, to approve the EDA minutes of April 8, 1991. Voting in favor: L'Herault, Otten, Erickson, Williamson; Voting against; None; Abstaining: Enck. Motion carried. Motion was made by Councilmember Enck, seconded by Commissioner Williamson, to approve the EDA minutes of April 22, 1991. All present voted in favor. Motion carried. President Erickson introduced for discussion Item 4, Consideration of Proposal to Prepare Planning Document/ Market Study Regarding Development of a Portion of Gethsemane Cemetery Property. Mr. Donahue explained that officials representing Gethsemane Cemetery have made application for a conditional use permit to allow a temporary office structure on the site for the purpose of the sale of spaces in a proposed mausoleum to be built at the cemetery. The CUP request is in the Planning Commission process at this time. In preliminary discussions with cemetery officials regarding long-range planning for the entire site, officials indicated to staff that they may give consideration to selling off a portion of the property on the westerly portion of the site for development. The funds would assist them in building the mausoleum. Staff developed several concept plans for several different sizes of developments and presented them to cemetery officials for review. At this time, staff would like the opportunity to have a professional planning document and market study prepared on the 18-20 acres of property to identify the market conditions that may influence the development of a portion of Gethsemane Cemetery. Such a study would identify development cost estimates for single family, townhome and May 28, 1991 MOTION ADJOURNMENT multiple-family market opportunities. The development of a portion of this property would not only coincide with the City's long-range goals of providing a greater diversity in housing, but would also maximize property values by utilizing vacant property. The estimated cost for the study is $2,250 according to the City's Planning Consultant. It would be funded by the HRA Redevelopment fund. Commissioner Enck expressed the need for quality control if it is determined that multiple-family housing is the best use for the land. Commissioner Williamson commented that it is difficult for a single-income family to afford a single family house and there is a need for housing in the $60-80,000 price range such as a townhomes and condos. President Erickson commented that in many instances "owned" housing is maintained better than "rental" units. Motion was made by Commissioner L'Herault, seconded by Commissioner Otten, authorizing the market study on development of a portion of Gethsemane Cemetery. All present voted in favor. Motion carried. Motion made by Commissioner Enck, seconded by Commissioner L'Herault to adjourn the EDA meeting as there was no further business to come before the Council. All present voted in favor. The New Hope EDA adjourned at 8:00 p.m. Respectful ly Submi.tted, Valerie Leone City Clerk New Hope EDA Page 2 May 28, 1991 Approved EDA Minutes Meeting #6 CITY OF NEW HOPE 4401Xylon Avenue North Hennepin County, Minnesota 55428 June 24, 1991 CALL TO ORDER ROLL CALL APPROVE MINUTES FOREHOST, INC. Item 4 President Erickson called the meeting of the Economic Development Authority to order at 9:05 p.m. Present: Erickson, L'Herault, Otten, Enck, Williamson Motion was made by Commissioner Otten, seconded by Commissioner Enck, to approve the EDA minutes of May 28, 1991. All present voted in favor. Motion carried. President Erickson introduced for discussion Item 4, Discussion of Request by Foremost, Incorporated for Economic Development Grant Program/Economic Recovery Fund Application {#474). Mr. Donahue stated City staff recently met with representatives of the Minnesota Department of Trade and Economic Development to discuss an Economic Recovery Fund Application to assist Foremost in the relocation/expansion of its business. Estimated costs for land, building and equipment at the new site total $815,800. These costs do not include the acquisition of the present Foremost site, which Mr. Fredendall feels has a value of $720,000. While the grant application could be structured to assist with the acquisition and development of the new site, the grant funds cannot be utilized by the City for the purchase of the existing site. While the acquisition price of the Foremost property might be reduced significantly if Foremost is successful in their suit against Electronic Industries and awarded damages, some source of revenue for the acquisition of the property {whether it be $400,000 or $720,000) must be found if the grant application is to proceed. A cash flow projection for Tax Increment District #8, which includes the loan to Autohaus, shows that the district is projected to have a cash balance of $3,500,000 at the end of the district's life in 2004. The cash balance at the end of 1990 was $454,000. While there is presently not enough cash in the district to purchase the property, the excess cost could be financed internally and paid back to the district. What has to be decided is whether the EDA desires to purchase the Foremost property and draw down the balance of the cash flow so that the New Hope EDA Page I June 24, 1991 grant can proceed. A second alternative that staff has discussed with Foremost, in the event that the City does not purchase the Foremost property, is that perhaps the City should shift its focus towards the acquisition of the Electronic Industries site. This would be less costly and the purpose here would be to rid 42nd Avenue and Foremost of the building/property from where the contamination was generated. The building would be demolished and the land possibly added to the present Foremost site to provide room for expansion and/or to make the Foremost site more marketable. In either case, a preliminary decision needs to be made regarding the acquisition of the Foremost site because this will determine if the grant application proceeds or not. Without the acquisition of the property, Foremost does not have the equity that is needed to invest in the grant for the relocation. Mr. Donahue stated the preliminary testings of the soils under and around the Foremost building show that there is no soil contamination but there is ground water contamination. He noted that Mr. Fredendall is asking $720,000 for the property, although it may have a market value closer to $420,000. The EDA could assist him by purchasing the Foremost property, however, by doing so, it would deplete the tax increment funds. Mr. Donahue recommended pursuing the Electronic Industries site. He stated the City is currently trying to get the building up to code and as a last resort may have it removed. He stated an option would be for the EDA to acquire Electronic Industries property, clear the building, clean up the soil problems then divide the properties between the two neighboring properties, Foremost Inc. and Ardel Industries. He stated the remaining properties would be brought into code conformance and the City would need to structure some type of agreement that if and when they ever sell the building, the City may recoup its investment. He commented that this would be less costly and would make both neighboring properties more attractive for sale. The EDA questioned the results of the wells. Mr. Donahue stated the wells are having a positive impact as the ground water contamination levels have significantly decreased. New Hope EDA Page 2 June 24, 1991 Commissioner Enck expressed concern that the extent of contamination is unknown as well as the cost for remedial action. He commented the EDA must address these issues. Also, the source of funding must be explained--appears to be Petro dollars. The cost/benefit ratio for the whole district must be determined. Mr. Enck spoke against the option of purchasing the Electronic Industries site since the City would then become the generator of the soil contamination problem. He also stated he did not believe that splitting the property between the neighboring property owners would accomplish anything since the buildings do not meet standards. He stated the EDA must find the real value of the Foremost property. He stated if the EDA assisted in any way, he would recommend demolishing the whole area to carry on with the intent of the redevelopment to dress up the 42nd Avenue and put some viable properties there. He stated the EDA could take over the properties, clean them up, and do remedial excavations. This would end up costing the EDA 10% of the total costs. He stated that cost could be carried over against Electronic Industries. He stated if Foremost can proceed on their own with some assistance from the EDA (purchasing property at market value), then the EDA would be complying with the intent of the 42nd Avenue Redevelopment Project which is to improve the neighborhood. President Erickson agreed with Commissioner Enck's recommendations. Mr. Donahue informed the EDA that most of the tax increment monies would be depleted. President Erickson noted that Foremost is anxious to reach an agreement since they are really cramped at their present building. He stated they are in a bind since they cannot get a loan from the bank to expand the building due to the soil contamination. However, the EDA should not pay an additional $300,000 than what the property is worth. President Erickson felt an appraisal is necessary and Foremost should share the cost. Mr. Donahue stated Foremost is currently having an appraisal conducted and is paying the entire cost. The EDA discussed the necessity of retaining an appraiser to determine the property's market value. New Hope EDA Page 3 June 24, 1991 Commissioner Enck expressed concern that the extent of contamination is unknown as well as the cost for remedial action. He commented the EDA must address these issues. Also, the source of funding must be explained--appears to be Petro dollars. The cost/benefit ratio for the whole district must be determined. Mr. Enck spoke against the option of purchasing the Electronic Industries site since the City would then become the generator of the soil contamination problem. He also stated he did not believe that splitting the property between the neighboring property owners would accomplish anything since the buildings do not meet standards. He stated the EDA must find the real value of the Foremost property. He stated if the EDA assisted in any way, he would recommend demolishing the whole area to carry on with the intent of the redevelopment to dress up the 42nd Avenue and put some viable properties there. He stated the EDA could take over the properties, clean them up, and do remedial excavations. This would end up costing the EDA 10% of the total costs. He stated that cost could be carried over against Electronic Industries. He stated if Foremost can proceed on their own with some assistance from the EDA {purchasing property at market value), then the EDA would be complying with the intent of the 42nd Avenue Redevelopment Project which is to improve the neighborhood. President Erickson agreed with Commissioner Enck's recommendations. Mr. Donahue informed the EDA that most of the tax increment monies would be depleted. President Erickson noted that Foremost is anxious to reach an agreement since they are really cramped at their present building. He stated they are in a bind since they cannot get a loan from the bank to expand the building due to the soil contamination. However, the EDA should not pay an additional $300,000 than what the property is worth. President Erickson felt an appraisal is necessary and Foremost should share the cost. Mr. Donahue stated Foremost is currently having an appraisal conducted and is paying the entire cost. The EDA discussed the necessity of retaining an appraiser to determine the property's market value. New Hope EDA Page 3 June 24, 1991 Approved EDA Minutes Meeting #7 CITY OF NEW HOPE 4401Xylon Avenue North Hennepin County, Minnesota 55428 July 22, 1991 CALL TO ORDER ROLL CALL APPROVE MINUTES FOREHOST, INC. Item 4 MOTION ADJOURNMENT President Erickson called the meeting of the Economic Development Authority to order at 9:05 p.m. Present: Erickson, L'Herault, Otten, Enck, Williamson Motion was made by Commissioner Enck, seconded by Commissioner L'Herault, to approve the EDA minutes of June 24, 1991. All present voted in favor. Motion carried. President Erickson introduced for discussion Item 4, Request Authorization to Obtain Appraisal on Foremost, Inc. Property at 7528 42nd Avenue North (Improvement Project No. 474). Mr. Donahue stated in order to proceed with the acquisition of the Foremost property and before a grant application can be submitted, specific costs must be identified. An appraisal is necessary so the City can structure an offer to purchase the property at fair market value. Staff is recommending that the appraisal be conducted by Brad Bjorklund, BCL Appraisal, Inc. for $5,000. He stated the appraisal will be funded out of 42nd Avenue tax increment monies. Motion was made by Commissioner Otten, seconded by Commissioner Enck, authorizing the apprmisml on Foremost, Inc. Property at 7528 42nd Avenue North {Improvement Project No. 474). Motion made by Commissioner Enck, seconded byCommissioner L'Herault to adjourn the EDA meeting as there was no further business to come before the Council. All present voted in favor. The New Hope EDA adjourned at 9:10 p.m. Respectful ly Submitted, Valerie Leone City C1 erk New Hope EDA Page I July 22, 1991 Approved EDA Minutes Meeting #8 CITY OF NEW HOPE 4401Xylon Avenue North Hennepin County, Minnesota 55428 October 14, 1991 CALL TO ORDER ROLL CALL APPROVE MINUTES CUSTOM HOLD PROPERTY 5430 INTERNATIONAL PARKWAY Item 5 President Erickson called the meeting of the Economic Development Authority to order at 9:20 p.m. Present: Erickson, L'Herault, Otten, Enck, Williamson Motion was made by Commissioner L'Herault, seconded by Commissioner Otten, to approve the EDA minutes of July 22, 1991. All present voted in favor. Motion carried. President Erickson indicated that Item 5 will precede Item 4 since Mr. Duane Trieber (Custom Mold & Design, Inc.) is in attendance. President Erickson introduced for discussion Item 5, Discussion Regarding Purchase of Outlot A, Custom Mold Addition, 5430 International Parkway. Mr. Donahue explained that Custom Mold and Design, Inc. is proposing to expand their existing facility to the north and is acquiring and platting the property at 5430 International parkway to accommodate the expansion {Planning Cases 91-28 and 91-30). The New Hope Public Works Garage is located directly north of this site and Public Works currently utilizes the northern portion of the vacant property. Custom Mold is acquiring the two acre site and proposing to plat it so that 1.12 acres would be combined with their existing property and .88 acres would be platted as an outlot, with an understanding that the City may have an interest in purchasing the property to expand the public works site. Mr. Donahue stated the City has informally discussed the acquisition of the property from Custom Mold. Mr. Duane Trieber, owner of Custom Mold, acquired the two acres of property at 5430 International Parkway for $179,000 or $89,500 per acre. The outlot contains .88 acres and the asking price is approximately $78,760 (.88 x $89,500). Mr. Donahue stated the City has no land for temporary storage of items such as rock, sand, dirt, etc. He stated arrangements will also have to be made soon for a salt storage building. New Hope EDA Page i October 14, 1991 FOREMOST, INC. 7528 42ND AVE. N. #474 Item 4 New Hope EDA Page 2 He stated besides the purchase price Mr. Trieber would like two other items addressed: 1) a plan for the site; and 2) excess fill material. Mr. Donahue explained that another factor to be taken into consideration is the potential development at 5501 Boone Avenue North {North Ridge development}. The property is low on the south and it is possible that excess soils from the Custom Mold property may be deposited on this site and if so, the purchase price may be lower. Mr. Donahue stated Chuck Thompson of North Ridge may be coming before the EDA in the near future. He indicated the City may want to consider becoming part of the North Ridge project and utilize the south portion for vehicular parking or some other use. The EDA authorized the City Manager to proceed to negotiate with purchasing the land from Custom Mold. Mr. Donahue stated any proposal made would be contingent upon approval by the EDA. Mr. Trieber stated if the City does not need the dirt, he would contract to have the dirt hauled away. However, if the City wanted it he could relocate the dirt. He expressed concern with the height of the potential salt dome and requested review of a concept plan. President Erickson commented that the City would have to go through the Planning Commission process and would work closely with Custom Mold to ensure that all concerns are addressed. Mayor Erickson introduced for discussion Item 4, Discussion Regarding Acquisition/Relocation of Foremost, Inc., 7528 42nd Avenue North. Mr. Donahue stated the appraisal of the Foremost, Inc. property has been completed and staff is continuing discussions with Foremost regarding the possible acquisition of the property and the relocation of the business within New Hope. Mr. Donahue updated the EDA and indicated in the past, the City has reviewed the Foremost deal as two projects in one: 1) the redevelopment of the Foremost property; and 2) the relocation of the Foremost facility within New Hope. He stated staff recommends establishing the redevelopment of 42nd Avenue as the City's first priority. He commented that whether Mr. Fredendall of Foremost relocates in New October 14, 1991 ADJOURNMENT Hope or not, should be considered secondary. He stated staff hopes that the business will remain in New Hope; however, that should be a separate issue. Mr. Donahue stated staff is in the process of obtaining an analysis between Foremost's appraisal and the City's appraisal of the property. Mr. Donahue stated a review appraisal would cost between $1,000 to $1,500. He stated he would use this information to determine what the City would be required to do under condemnation opposed to what the City might be willing to offer for the property. The EDA agreed with Mr. Donahue's recommendations in that it would be advantageous to separate the issues. Motion made by Commissioner Otten, seconded by Commissioner Williamson to adjourn the EDA meeting as there was no further business to come before the Council. All present voted in favor. The New Hope EDA adjourned at 9:45 p.m. Respectful ly submitted, Val erie Leone City Clerk New Hope EDA Page 3 October 14, 1991 Approved EDA Minutes Meeting #g CITY OF NEW HOPE 4401Xylon Avenue North Hennepin County, Minnesota 55428 November 12, 1991 CALL TO ORDER ROLL CALL APPROVE HINUTES CUSTOH HOLD PROPERTY 5430 INTERNATIONAL PARKWAY Item 5 President Erickson called the meeting of the Economic Development Authority to order at 8:20 p.m. Present: Erickson, L'Herault, Otten, Enck, Williamson Motion was made by Commissioner Otten, seconded by Commissioner Enck, to approve the EDA minutes of October 14, 1991. All present voted in favor. Motion carried. President £rickson introduced for discussion Item 4, Discussion Regarding Purchase of Outlot A, Custom Mold Addition, 5430 International Parkway (Improvement Project No. 488). Mr. Donahue explained that staff met with Custom Mold and Design, Inc. to discuss the property and the final plat. The actual approval of the final plat is contingent upon whether the City wishes to acquire the Outlot A from that plat. Mr. Donahue explained that the reason for the purchase of Outlot A is to expand the Public Works property. The City has been utilizing Outlot A for several years to store various materials. Permission for its use was granted by the owner; however, the City did not have to pay anything. The purchase of the property would provide sufficient land to store materials (sand, rock, gravel, etc). He also explained that the State is mandating that salt and sand used during winter months be stored under cover to avoid migration into storm water. Mr. Donahue continued noting that soil borings dating back to 1979 indicate the property is buildable land. He stated that if a salt dome is built, staff will recommend that it be built in the existing yard rather than outlot A due to a better access. Commissioner Enck inquired how salt and sand would be mixed if staff desired to change the percentage of each. Mr. Hanson, City Engineer, stated Public Works typically mixes a quantity of 1100-1400 ton of salt/sand twice per year rather than mixing different percentages. He stated New Hope EDA Page 1 November 12, 1991 EDA RES. 91-3 Item 4 ADJOURNHENT he would anticipate that Public Works would load the dome in the fall before the winter starts and if needbe a second time during the winter. He explained that the sand/salt would be mixed in the yard then put in the dome through a conveyor in the same manner as filling a silo. Mr. Donahue noted that funds from the existing reserves in the Central Garage Fund would be used rather than funds in the General Fund. Mr. Sondrall stated the petitioner was concerned regarding construction of a berm which would be partially constructed on the City's property once the property was acquired. He explained that the purchase agreement would provide for provisions for that berm to be constructed Partly on the petitioner's property and partly on the City's property and each party would then bear their own cost for sodding/seeding the berm. Second, at the request of the petitioner, a height restriction on storage of material will be made a condition of the deed. The EDA discussed the property purchase price of $78,760 (.88 acre x $89,500) for Outlot A. Commissioner L'Herault introduced the following resolution and moved its adoption: "RESOLUTION AUTHORIZING PURCHASE OF OUTLOT A, CUSTOM MOLD ADDITION". The motion for the adoption of the foregoing resolution was seconded by Commissioner Enck, and upon vote being taken thereon; the following voted in favor thereof: Erickson, L'Herault, Otten, Enck, Williamson; and the following voted against the same: None; Absent: None; whereupon the resolution was declared duly passed and adopted, signed by the president which was attested to by the executive director. Motion made by Commissioner Williamson, seconded by Commissioner L'Herault to adjourn the EDA meeting as there was no further business to come before the Council. All present voted in favor. The New Hope EDA adjourned at 8:30 p.m. Respectful ly submitted, City Clerk New Hope EDA Page 2 November 12, 1991 Approved EDA Minutes Meeting #10 CITY OF NEW HOPE 4401Xylon Avenue North Hennepin County, Minnesota 55428 November 25, 1991 CALL TO ORDER ROLL CALL APPROVE HINUTES 7305 42ND AVENUE NORTH PROPERTY Item 4 President Erickson called the meeting of the Economic Development Authority to order at 9:51 p.m. Present: Erickson, L'Herault, Otten, Enck Absent: Williamson Motion was made by Commissioner L'Herault, seconded by Commissioner Enck, to approve the EDA minutes of November 12, 1991. All present voted in favor. Motion carried. President Erickson introduced for discussion Item 4, Discussion with Rapid Oil Inc. Regarding City-Owned Property at 7305 42nd Avenue North. Mr. Donahue, City Manager, explained that Valvoline Company would like to make a presentation to the EDA regarding the city-owned property at 42nd and Winnetka. He stated the proposal is for a Rapid Oil Change facility on the site next to All Star Sports. He indicated the EDA does not have to take any action tonight on the matter. He pointed out that the EDA may accept or reject the proposal and is under no obligation. Commissioner Enck inquired whether All Star Sports has expressed an interest in the property. President Erickson stated he did speak with Mr. Norman on Friday and he is very interested in expanding his building and would like to discuss it with the City. Mr. Mark Segal, Valvoline Rapid Oil Change, Inc. Real Estate Field Representative, was recognized. He stated they are willing to pay a fair market value for the property. Mr. Segal showed a prototype building of Rapid · Oil Change. He stated Rapid Oil Change would change the property which is currently non-taxable into taxable functioning property. President Erickson explained that he would favor utilizing the property for an addition to the All Star Sports facility rather than a automobile service station. He New Hope EDA Page 1 November 25, 1991 pointed out that the plan for 42nd Avenue Redevelopment was to minimize commercial uses of property where petroleum products are dispensed and the Rapid Oil Change is closely related to this type of use. Mr. Segal inquired whether the purchase price would influence the EDA's decision. President Erickson stated at this time the EDA cannot react to All Star Sports because they have not made a formal proposal. Mr. Segal emphasized that Rapid Oil Change businesses are good corporate neighbors, and he asked how long the EDA is willing to wait for a formalized proposal from All Star Sports. President Erickson noted that he would like to see something concrete this winter so construction can begin next summer. Commissioner Enck pointed out that President Erickson has provided his feelings regarding the site; however, the other EDA members may not agree. He explained that he would like to consider a proposal and purchase offer; however, Mr. Segal has not provided that tonight. He stated he would like to see the market value and traffic generation, etc. Commissioner L'Herault agreed that more information is necessary. He commented that he feels a Rapid Oil Change is considerably different than a gas station operation. Mr. Donahue pointed out three items: first, the EDA is the property owner and can act like a property owner; second, the EDA has a development plan for 42nd Avenue which would have to be modified to accept this proposal; and third, a purchase offer should be presented at the same time as the proposal. Mr. Segal stated his primary purpose tonight was to introduce Rapid Oil Change and obtain an inclination from the EDA as to their feelings for the property. He indicated he would be happy to return with a proposal and purchase offer. Mr. Sondrall, City Attorney, informed the EDA that a public hearing would be required before city-owned property could be sold. Therefore, the EDA should bear in mind the notification requirements. Commissioner Enck recommended that Mr. Segal provide a New Hope EDA Page 2 November 25, 1991 ELECTRONIC INDUSTRIES Item 5 ~OTION Item 5 NORTHNEST YMCA Item 6 rendering of the structure and indicate the structure's value when he presents the proposal. Mr. Segal replied that he would not be able to give the EDA a site plan unless the project was authorized due to the expense. He reported that he could provide an old set of plans and a rendering. He stated a 1300 square foot two-bay building is proposed for the site. President Erickson introduced for discussion Item 5, Discussion on Request for Authorization to Obtain Appraisal on Electronic Industries Property at 7516 42nd Avenue North. Mr. Sondrall indicated the City has formally served an order under the Hazardous Building Act which would require action on the part of the property owner. The action would be either to respond formally much like an answer in a civil lawsuit or do nothing which would cause the City to make a motion in court to have the building razed. He explained that nothing will happen on the property for 30 days. The property owner has contacted the City and indicated that they would be willing to sell the property at a reasonable price, in light of the order. They do not desire to make extensive repairs to the building, only to have the property taken by the City. Mr. Sondrall stated an appraisal is necessary so the EDA can determine the property's market value. He pointed out that if the property is not sold to the EDA, the City will proceed with its action in district court for requiring improvements to the property or the demolition of the property. Mr. Donahue indicated the approximate cost of the appraisal is $3,500. Motion was made by Commissioner Enck, seconded by Commissioner L'Herault, to authorize the appraisal for $3,500. All present voted in favor. Motion carried. President Erickson introduced for discussion Item 6, Discussion with Northwest YMCA on Their Vacant Parcel. Mr. Duane Ostlund, representing YMCA, was recognized and stated the assessment for Quebec Avenue Extension for the YMCA amounted to $76,000. He stated on behalf of the YMCA Chuck Holmes sent a letter to Mayor Erickson regarding a New Hope EDA Page 3 November 25, 1991 proposal indicating that the YMCA would deed over to the City of New Hope the holding pond and the high ground south of the YMCA as its payment for the project assessment. He stated several years ago the YMCA allowed the City to construct a holding pond on its property and the Y was not compensated but cooperated with the City. He explained that the YMCA not only is a health enhancement facility but it does a tremendous job working with the youth and family of the community. The $76,000 assessment will severely hamper their ability to continue the programs at the same level. Mr. Ostlund asked the EDA to seriously consider the proposal. He pointed out that timing is crucial as the assessment deadline is November 30th in order to avoid interest. President Erickson stressed the need to separate the issues. He stated if the City is interested in purchasing the property, that should be issue number one and the assessment is number two. He encouraged the YMCA to make arrangements for paying the assessment or putting it on the tax rolls. He stated if the City purchases the property, the YMCA could do whatever it wishes with the money. President Erickson stated the EDA will consider the proposal but is not prepared to make a decision tonight. Mr. Donahue stated it should be made clear that the issues are separate and the YMCA has a deadline to meet in terms of filing their appeal if they desire to go that route. Mr. Sondrall stated the appeal notice is based on the YMCA's ability to appeal their assessment not just pay it. If they decide the assessment was inappropriately levied against their property, they would have 30 days from the day of the adoption of the assessment to challenge the amount. A possible acquisition of the property would in no way extend the appeal period or waive any challenge that the City might make in the event they want to appeal it later. The assessment was adopted on October 28, 1991; therefore, the YMCA has until November 28th to make an appeal. Commissioner Enck questioned the size of the property. Mr. Donahue stated it is .96 acres. He stated staff is exploring the possibility with Crystal for a joint salt/sand dome or a fuel facility. The property alone is New Hope EDA Page 4 November 25, 1991 AD~OURNRENT probably too small; however, it may be feasible if it were combined with the large piece of vacant property owned by the school district south of the bus barn. He .commented it may also serve the school district's fuel needs. Motion made by Commissioner L'Herault, seconded by Commissioner Enck, to adjourn the EDA meeting as there was no further business to come before the Council. All present voted in favor. The New Hope EDA adjourned at 10:21 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA Page 5 November 25, 1991 Approved EDA Minutes Meeting #11 CITY OF NEW HOPE 4401Xylon Avenue North Hennepin County, Minnesota 55428 December 9, 1991 CALL TO ORDER ROLL CALL APPROVE MINUTES FOREMOST PROPERTY Item 4 President Erickson called the meeting of the Economic Development Authority to order at 8:55 p.m. Present: Erickson, L'Herault, Otten, Williamson Absent: Enck Motion was made by Commissioner L'Herault, seconded by Commissioner Otten, to approve the EDA minutes of November 25, 1991. All present voted in favor. Motion carried. President Erickson introduced for discussion Item 4, Discussion Regarding Acquisition of Foremost, Inc. Property, 7528 42nd Avenue North, Improvement Project No. 474. Mr. Donahue stated staff would like to discuss the acquisition of the Foremost, Inc. property at 7528 42nd Avenue North with the EDA. He stated last June the EDA gave the City Manager strong direction to pursue the acquisition of the properties {Foremost, Electronic Industries, and Ardel) based upon the previously accepted plan for the development of the properties east of Quebec on 42nd Avenue {42nd Avenue Redevelopment Plan). The EDA has pursued a plan where it wishes to look at commercial development of the properties given the problems associated with the area including the substantial pollution allegedly caused by Electronic Industries which is the property located near Foremost. He indicated during the past six months City staff has been working with Mr. Fredendall, owner of Foremost, and his attorney to negotiate an agreement whereby the City could acquire the property. He stated the proposal is comparable to costs the City could expect to pay in a contested condemnation action. Mr. Donahue referred to the City Attorney's December 3rd letter which outlined the City's proposal on the acquisition of the property: 1) A purchase price not to exceed $585,000 {figured arrived at based on payment of outstanding mortgage equaling $484,962; payment of unpaid real estate taxes for years 1990 and 1991 of $64,792; payment of unpaid special assessments not certified to tax rolls of $14,692; payment of relocation expenses of $20,000) New Hope EDA Page 1 December 9, 1991 New Hope EDA Page 2 2) After acquisition of the property the City would continue to allow Foremost to operate at the property without payment of rent for a period not to exceed 24 months. Foremost would pay all operational costs associated with their use of the property including, but not limited to, real estate taxes, utility charges and insurance. Also, they would receive a gO-day notice provision to vacate the property. 3) Upon their vacation of the property, they would be allowed to remove all personal property, machinery and equipment including any item which would be considered a movable fixture. In other words, they would have all salvage rights to the building given the fact that we intend to demolish the building for redevelopment. 4) Foremost would agree to execute an agreement providing the EDA with an equal share of the judgement collected on their lawsuit against Electronic Industries after payment of attorney's fees and not to exceed $50,000. In other words, there will be the possibility that the City would receive a $50,000 reimbursement in the event that Foremost was very successful in their lawsuit against Electronic Industries. Mr. Donahue stated a lawsuit has been initiated based upon the loss of property value. Foremost is claiming there is a stigma attached to their property in that there is a loss of market value due to their proximity to Electronic Industries which allegedly caused substantial pollution to their property. He stated the City's appraisal also referred to the pollution stigma: "the site is stricken with stigma of pollution because of its proximity to polluted Electronic Industries". He explained that the Foremost property has ground water contamination but does not have any soil contamination. He pointed out that there is protection under state and federal laws whereby the purchaser of property does not assume any problems or liabilities. Mr. Donahue asked the City Attorney to further explain how the proposed price was reached. He noted the possibility of $50,000 reimbursement if Foremost is successful in their lawsuit. President Erickson stated staff was directed to consider this and it would relate to the plan to upgrade 42nd Avenue. However, there are so many influences on the proposal that he would strongly recommend holding a work session to discuss the different issues. Mr. Sondrall stated one qualification he would like to make is that the $585,000 figure that is quoted in the December 9, 1991 letter does not necessarily represent what a court or a jury or another appraiser might consider to be the market value of the property. He stated the figures that the City Manager read were basically utilized to understand what the property owner at Foremost is facing in regard to expenses, liabilities, and problems in marketing the property. It does not represent a "market value" that the property is worth. He continued by explaining that if the EDA wishes to pursue the acquisition of the property, he would recommend a friendly condemnation action because of the protection from contamination liability found in chapter 117. The necessary action if the EDA is desirous of pursuing this option, would be to pass a resolution authorizing the condemnation and authorizing a direct purchase of the property under chapter 117. Commissioner Otten inquired how unpaid real estate taxes are normally handled in condemnation actions. Mr. Sondrall indicated they would be subtracted from the determination of value that was ultimately arrived at in the condemnation action. Mr. Donahue discussed the project time table and commented that there are some considerations for completing the matter by January 1, 1992. Mr. Donahue also noted that the $585,000 would not come from City funds but would be paid through the redevelopment district that has been created along 42nd Avenue. He stated there are excess revenues in TIF District No. 8. Mr. Bill Skolnick, Attorney representing Mr. & Mrs. Fredendall (owners of Foremost), was recognized. He stated there is a time issue for the matter to get resolved. He reported their appraisal is at $660,000 unimpaired. Mr. Skolnick stated a contested condemnation action could exceed $660,000. He stated Foremost is proceeding with the litigation and he has obtained a report by their environmental consultants which clearly demonstrates that Electronic Industries polluted the Foremost property. Mr. Skolnick concluded by conveying that he would gladly furnish any documents requested by the EDA. Commissioner Otten noted the $585,000 equates to approximately $27 per square foot. New Hope EDA Page 3 December 9, 1991 WORK SESSZON ADJOURNMENT Mr. Sondrall stated the $585,000 price takes into consideration the relocation costs as well as the market value of the property {land and building). Mr. Sondrall stressed the importance of starting a condemnation action since that is necessary in order to obtain the benefit covered under chapter 117 relating to acquiring contaminated property and not being responsible for clean-up costs. He stated if the EDA does not pursue under Chapter 117 then it may have to deal with contamination clean-up costs. He stated the matter was approached with the number one concern being the acquisition of the property for future development in accordance with the guidelines for ¢2nd Avenue. He noted that while the negotiated price may be on the high side, it may be a good deal if the property owner's case is accepted rather than the City's side. President Erickson stated this is a cooperative effort between the City and Foremost. He believes the purchase will be advantageous to both parties. Mr. Skolnick clarified an item contained in number two in the proposal which refers to a 90 day notice provision given by the City. He pointed out that it should be reversed whereby Foremost may give the City a 90-day notice. He stated if Foremost finds an alternate site before expiration of the 24 months, it has the right to vacate. Commissioner Otten stated he would like to obtain options for the two combined properties and agreed that a work session would be beneficial. The EDA scheduled a work session for Monday, December 16, 1991, at 6 p.m. to continue discussions regarding the Foremost property. Motion made by Commissioner L'Herault, seconded by Commissioner Otten to adjourn the EDA meeting as there was no further business to come before the Council. All present voted in favor. The New Hope EDA adjourned at 9:30 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA Page 4 December g, 1991 Approved EDA Minutes Meeting #12 CITY OF NEW HOPE 4401Xylon Avenue North Hennepin County, Minnesota 55428 December 23, 1991 CALL TO ORDER ROLL CALL APPROVE NINUTES ARDELL ENGINEERING PROPERTY Item 4 HOTION ADJOURNMENT President Pro Tem Enck called the meeting of the Economic Development Authority to order at 8:31 p.m. Present: Enck, L'Herault, Otten, Williamson Absent: Erickson Motion was made by Commissioner L'Herault, seconded by Commissioner Williamson, to approve the EDA minutes of December 9, 1991. Voting in favor: Otten, Williamson, L'Herault; Abstaining: Enck; Absent: Erickson. Motion carried. President Pro Tem Enck introduced for discussion Item 4, Discussion on Request for Authorization to Obtain Appraisal on Ardell Engineering and Manufacturing Property at 7500 42nd Avenue North (Project No. 474). Mr. Donahue indicated at the work session last week, Council directed staff to initiate an appraisal on the property on 7500 42nd Avenue. The motion tonight would formalize that directive and would authorize the City's appraiser, Brad Bjorklund to undertake the work for a cost of $1,200 to $1,800. President Pro Tem Enck questioned whether the appraisal will be a formula in which it may be adjusted up or down depending on changes in property values in case nothing is done within a year or two. Mr. Donahue stated he believes it could be updated rather than repeating the whole process. Mr. Sondrall stated the appraiser would probably update the comparables to determine market value. Motion was made by Commissioner Otten, seconded by Commissioner L'Herault, to authorize the appraisal on Ardell Engineering and Hanufacturing Property at 7500 42nd Avenue North. All present voted in favor. Motion carried. Motion made by Commissioner Otten, seconded by Commissioner L'Herault, to adjourn the EDA meeting as New Hope EDA Page I December 23, 1991 there was no further business to come before the Council. All present voted in favor. The New Hope EDA adjourned at 8:35 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA Page 2 December 23, 1991