090814 EDA
CITY OF NEW HOPE
4401 XYLON AVENUE NORTH
NEW HOPE, MINNESOTA 55428
EDA Minutes September 8, 2014
Regular Meeting City Hall
CALL TO ORDER President Hemken called the meeting of the Economic Development
Authority to order at 7:56 p.m.
ROLL CALL Present: Kathi Hemken, President
John Elder, Commissioner
Andy Hoffe, Commissioner
Eric Lammle, Commissioner
Daniel Stauner, Commissioner
Staff Present: Kirk McDonald, City Manager
Jeff Alger, Community Development Assistant
Aaron Chirpich, Community Development Specialist
Valerie Leone, City Clerk
Chris Long, City Engineer
Bob Paschke, Director of Public Works
Jeff Sargent, Director of Community Development
Steve Sondrall, City Attorney
Stacy Woods, Assistant City Attorney
APPROVE MINUTES Motion was made by Commissioner Hoffe, seconded by Commissioner Elder,
to approve the regular meeting minutes of July 28, 2014. Voting in favor:
Hemken, Elder, Hoffe, Stauner; voting against: None; Absent: None;
Abstained: Lammle. Motion carried.
CITY CENTER TIF President Hemken introduced for discussion EDA Item 4, Resolution
DISTRICT
adopting a modification to the redevelopment plan for Redevelopment Project
IMP. PROJECT 893
No. 1; and establishing the City Center Tax Increment Financing District
Item 4
therein and adopting a tax increment financing plan therefor (project no. 893).
Mr. Kirk McDonald, city manager, stated the resolution before the EDA is
similar to the one adopted by the City Council following the public hearing.
RESOLUTION 2014-14 Commissioner Lammle introduced the following resolution and moved its
Item 4 adoption “RESOLUTION ADOPTING A MODIFICATION TO THE
REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO. 1;
AND ESTABLISHING THE CITY CENTER TAX INCREMENT
FINANCING DISTRICT THEREIN AND ADOPTING A TAX
INCREMENT FINANCING PLAN THEREFOR (PROJECT NO. 893).” The
motion for the adoption of the foregoing resolution was seconded by
Commissioner Elder, and upon vote being taken thereon, the following voted
in favor thereof: Hemken, Elder, Hoffe, Lammle, Stauner; and the following
voted against the same: None; Abstained: None; Absent: None, whereupon
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Page 1September 8, 2014
the resolution was declared duly passed and adopted, signed by the president
which was attested to by the executive director.
Item 5 Mr. Kirk McDonald, city manager, requested the EDA postpone discussion on
Item 5 as it is a public hearing scheduled at 8 p.m. or later.
INTERFUND LOAN President Hemken introduced for discussion EDA Item 6, Resolution
Item 6
authorizing and ratifying an interfund loan for advance of certain costs in
connection with the City Center Redevelopment Tax Increment Financing
District.
Ms. Stacie Kvilvang, Ehlers Inc., stated the EDA is being asked to combine an
existing interfund loan (approved by the EDA in 2013) and authorize
combining it with a new interfund loan for up to $8 million from EDA funds
including its development fund and existing TIF Districts 85-1, 85-2, and 86-1.
She explained the EDA will reimburse these funds for costs related to the city
center redevelopment. The action provides the EDA with flexibility to
reimburse itself in the future when TIF funds are available from the newly
created City Center TIF District. She stated the EDA should review all cash
flow and make a decision in the future regarding whether to bond or not.
Commissioner Stauner inquired whether the loan could be used for
acquisition and demolition costs. Ms. Kvilvang responded affirmatively.
RESOLUTION 2014-15 Commissioner Elder introduced the following resolution and moved its
Item 6 adoption “RESOLUTION AUTHORIZING AND RATIFYING AN
INTERFUND LOAN FOR ADVANCE OF CERTAIN COSTS IN
CONNECTION WITH THE CITY CENTER REDEVELOPMENT TAX
INCREMENT FINANCING DISTRICT.” The motion for the adoption of the
foregoing resolution was seconded by Commissioner Hoffe, and upon vote
being taken thereon, the following voted in favor thereof: Hemken, Elder,
Hoffe, Lammle, Stauner; 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.
2015 EDA LEVY President Hemken introduced for discussion EDA Item 7, Resolution
Item 7
authorizing the proposed levy of a special benefit levy pursuant to Minnesota
Statutes, Section 469.033, subdivision 6 and approval of a preliminary budget
for fiscal year 2015.
Mr. Kirk McDonald, city manager, stated the Council will be reviewing the
General Fund budget during the Council Meeting. He stated the EDA must
adopt a resolution authorizing the levy. He reported the levy is $150,000
which is the same amount as last year.
Ms. Jean McGann, AEM, stated the EDA is asked to pass the resolution and
recommend action to the City Council. She stated the EDA must adopt a
resolution for its levy prior to City Council action.
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RESOLUTION 2014-16 Commissioner Lammle introduced the following resolution and moved its
Item 7 adoption “RESOLUTION AUTHORIZING THE PROPOSED LEVY OF A
SPECIAL BENEFIT LEVY PURSUANT TO MINNESOTA STATUTES,
SECTION 469.033, SUBDIVISION 6 AND APPROVAL OF A
PRELIMINARY BUDGET FOR FISCAL YEAR 2015.” The motion for the
adoption of the foregoing resolution was seconded by Commissioner Stauner,
and upon vote being taken thereon, the following voted in favor thereof:
Hemken, Elder, Hoffe, Lammle, Stauner; 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.
PUBLIC HEARING President Hemken introduced for discussion EDA Item 5, Public Hearing -
PURCHASE
Resolution authorizing the execution of a purchase and development
AGREEMENT
agreement with Hy-Vee, Inc. (project no. 893).
IMP. PROJECT 893
Item 5
Ms. Stacie Kvilvang, Ehlers Inc., reviewed the terms of the purchase and
development agreement as outlined in her memorandum dated September 8,
2014:
1.General – the agreement is a two party agreement between the EDA and
Hy-Vee Inc.
2.Acquisition – Hy-Vee will purchase the Kmart site, Wells Fargo Bank site
and EDA parking lot site for $3,725,000 and are responsible to pay all
broker commissions. Closing is to occur on or before September 30, 2014.
3.Platting and Zoning – the properties will be platted into four parcels
4.Repurchase Option for Office/Retail Parcel – lot 3 – Hy-Vee has three
years from closing to commence construction. Hy-Vee can request a one-
year extension. After four years the EDA has option to repurchase lot 3 for
$470,000. Hy-Vee is limited to resale of this lot to an independent third
party for its costs of acquisition, improvements, carrying costs and soft
costs, which are based upon a prorated share of the developable land in
relation to these costs.
5.Phases and Timing of Construction - Must commence construction on
Phase 1A (grocery store) by June 1, 2015, and complete by May 31, 2016;
Must commence construction on Phase 1B (convenience/gas) by June 1,
2015, and complete by May 31, 2016; Must commence construction on
Phase II (retail/office space) by October 1, 2017, and complete by October
30, 2018.
6.Public Improvements – city will pay for utilities, streetscape
improvements and be responsible for plowing public streets and street
light maintenance. Anderson Companies will prepare plans and
specifications for public plaza. Anderson-KM Builders will construct the
public plaza at city’s cost. Hy-Vee will prepare plans and specs and
construct all roads, sidewalks, and utilities within the redevelopment
property. Hy-Vee shall pay for and construct streetscape improvements
within the rights-of-way (east side of Xylon between 42 and the north
nd
end of redevelopment property and south side of redevelopment
property along 42). Hy-Vee will be responsible for maintenance and
nd
plowing of private roads, sidewalks, and landscaping.
7.TIF District – Anderson-KM Builders will pay 100% of the EDA’s costs for
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consultants in connection with the creation of a TIF District.
8.Deed Restrictions for lot 3 – EDA and Hy-Vee to resolve and incorporate
into an Easement with Covenants and Restrictions Affecting Land (ECR)
which will be an exhibit to the development agreement.
Ms. Kvilvang recommended the public hearing be continued to September 22
2014, to enable completion of the full document (including deed restrictions).
President Hemken opened the floor to questions from the audience.
Mr. Jonathan London, 8516 Hopewood Lane, was recognized. He inquired
whether Hy-Vee presented a business case study.
Commissioner Stauner stated it is his understanding that an analysis was
completed but that Hy-Vee considered it proprietary, and therefore, it was not
made public.
Mr. London expressed concern regarding the viability of a grocery store. He
stated he does not believe the City Council performed its due diligence.
Mr. Jeff Sargent, director of community development, explained that the
developer has arrived at a conclusion that New Hope is a great location for
the project. He stated there may be some risk, but many discussions have
taken place with Hy-Vee. He noted residents support the project as shown by
community surveys.
Mr. Bob Deike, development attorney, stated additional information will be
available in two weeks. He recommended continuing the public hearing until
September 22, 2014.
Commissioner Stauner inquired whether the construction will be solely
undertaken by Anderson Companies as Council has received emails from
interested construction firms.
Mr. Kent Carlson, Anderson Companies, stated Anderson Companies do not
have the capability to build the number of retail properties proposed by Hy-
Vee and will likely be seeking assistance from other developers. He advised
the EDA to forward inquiries to him.
Commissioner Stauner requested two sections of the draft agreement be
amended:
3.6 – recommends the section be divided into sub parts.
4.4 sub part C – recommended the language currently in parentheses
be rewritten without parentheses.
MOTION Motion was made by Commissioner Lammle, seconded by Commissioner
Item 5 Elder, to continue the public hearing to the September 22, 2014, EDA
Meeting. All present voted in favor. Motion carried.
ADJOURNMENT Motion was made by Commissioner Lammle, seconded by Commissioner
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Elder, to adjourn the meeting. All present voted in favor. Motion carried. The
New Hope EDA adjourned at 8:17 p.m.
Respectfully submitted,
Valerie Leone, City Clerk
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