092704 EDA
CITY OF NEW HOPE
4401 XYLON AVENUE NORTH
NEW HOPE, MINNESOTA 55428
EDA Minutes September 27, 2004
Regular Meeting City Hall
CALL TO ORDER
President Collier called the meeting of the Economic Development
Authority to order at 8:17 p.m.
ROLL CALL
Present: Don Collier, President
Doug Andersen, Commissioner
Sharon Cassen, Commissioner
Mary Gwin-Lenth, Commissioner
Steve Sommer, Commissioner
APPROVE MINUTES
Motion was made by Commissioner Sommer, seconded by Commissioner
Andersen, to approve the Regular Meeting Minutes of September 13, 2004.
All present voted in favor. Motion carried.
IMP. PROJECT 773
President Collier introduced for discussion Item 4, Resolution regarding
Item 4
execution and delivery of a contract for private redevelopment by and
between the New Hope Economic Development Authority and the Ryland
Group, Inc. (Winnetka Green Phase III) (improvement project no. 773).
Mr. Kirk McDonald, director of community development, stated staff is
requesting that the EDA approve a resolution affirming support of the
Winnetka Green Phase III expansion and authorizing staff to proceed with
appraisals and relocation estimates and to continue to work on the studies
necessary to determine eligibility of the eight Phase III parcels for inclusion
in the tax increment district. He stated a representative of Krass Monroe, the
city’s financial consultant, and a representative from Ryland Homes is
present if the council has questions.
Mr. McDonald stated the proposed expansion of this development has been
under discussion since June of 2004. There was a term sheet approved by
the city council in July. Staff updated the EDA on the proposal on August 9,
a neighborhood meeting was held August 25, and a special council meeting
was held on September 23 devoted specifically to discuss the proposed
expansion.
He stated staff is requesting the EDA to make a determination of whether
the project will proceed or not. Mr. McDonald reviewed contents of the
resolution:
Section 1.02: The EDA is considering the addition of a proposed
Phase III to Winnetka Green which would be constructed on the
following parcels: 5509 Sumter, 5510 Sumter, 5501 Sumter, 7708 55,
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7700 55, 7624 55, 7616 55, and 7608 55 Avenue North.
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EDA Meeting September 27, 2004
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Section 1.03: It has been proposed that the EDA enter into a contract
for private redevelopment with Ryland Group relating to the Phase
III parcels.
Section 2: Assuming that the findings can be made that this area
would qualify as a TIF District, the city would approve the contract
with Ryland Homes if the terms are in the same form as approved
on July 26.
Section 3: Authorizes city staff to obtain appraisals for the eight
properties in phase III, authorizes city staff to engage Evergreen
Land Services to obtain relocation estimates for the eight properties,
and authorizes city staff to continue to work with Short Elliott
Hendrickson to complete the building eligibility reports.
Mr. McDonald explained that in compliance with the term sheet approved
on July 26, 2004, Ryland Homes deposited $25,000 with the city to cover
initial expenses related to the Phase III expansion. The costs associated with
the appraisals, relocation estimates, and TIF eligibility would be funded
with that money.
Mr. McDonald stated staff is seeking direction from the EDA on whether to
proceed or not with phase III.
President Collier pointed out that the resolution as presented is written in
the affirmative. He asked the city attorney to clarify the outcome if no
motion is made on the item.
Mr. Steve Sondrall, city attorney, advised that there would be no
authorization to proceed if the resolution supporting Phase III does not pass
by a majority vote. He also stated if the EDA fails to introduce the
resolution, in essence, the phase III development is not approved.
President Collier entertained a motion on the resolution. No motion was
introduced by the EDA; therefore, the development of Phase III was
determined as denied.
Members of the EDA presented explanations for their position on the
proposed Phase III development. It was emphasized that the Winnetka
Green development will be a successful housing development in its current
configuration. The EDA thanked those involved with Phase III discussions
for their input including Ryland Homes, the neighborhood, and members of
the Livable Communities Task Force.
The EDA directed staff to facilitate discussions between Ryland Homes and
the property owners interested in purchasing Outlot A. Staff was also asked
to work with the property owner adjacent to the park regarding the sanitary
sewer issue. A suggestion was made to utilize the scattered site housing
program to assist property owners of the former phase III area that may be
experiencing water problems and may be interested in relocation.
EDA Meeting September 27, 2004
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IMP. PROJECT 603
President Collier introduced for discussion Item 5, Discussion and update
Item 5
regarding development proposal for the EDA owned property located at
7819 Angeline Drive (improvement project no. 603).
Mr. Shawn Siders, community development specialist, stated staff requests
EDA discussion and direction regarding the proposed development of the
EDA owned parcel located at 7819 Angeline Drive. The property is vacant
and has never been developed. The city recently received an inquiry for a
private market sale of the property for the development of a single-family
home.
The EDA acquired the tax-forfeited parcel for approximately $7,053 which
included the sales price of $5,000, $223.70 for incidental expenses as well as
special assessment fees in the amount of $1,830.
The lot was appraised in 2002 for $46,000. At that time SLP Investments, Inc.
was interested in the property as well as the lot at 7813 Angeline Drive. The
sale did not occur as an agreement could not be reached for the 7813
Angeline Drive property.
On September 21, 2004, Kingsman, LLC submitted a development proposal
for the purchase and development of a single family home on the property
located at 7819 Angeline Drive. City staff has reviewed the proposal and it is
in substantial compliance with the city’s Zoning Ordinance. The developer
has indicated that a purchaser has been identified and they would like to
move into the home on or around December 1, 2004. The proposed single-
family unit will have three bedrooms and two bathrooms with 1,225 square
feet of finished space. The main level would be 970 square feet. There will
be a two-car garage constructed to the front of the home.
Mr. Siders illustrated photographs of the proposed home. He noted the
developer has constructed numerous homes on sites with environmental
and other site constraints. The developer has offered to purchase the lot for
$35,000. The applicant calculated the offer of $35,000 for the lot based on the
proposed site improvements and what the potential purchaser could afford.
Mr. Siders stated the $35,000 offer is significantly greater than the original
purchase price of $7,053.70, however, it is $11,000 less than the value
determined by the appraisal. Because there were no soil borings conducted,
city staff cannot reasonably determine what costs may be associated with
corrective soils measures that may need to be completed.
Mr. Siders stated the city has not been actively marketing this property.
Information regarding the availability of this vacant parcel has been
provided upon developer inquiries.
It was noted that the property is currently vacant and tax exempt. The
property would generate between $2,500-3,000 in annual property taxes if a
house valued at $180,000 – 200,000 is constructed at the site.
Mr. Donahue, city manager, mentioned the property was previously
unbuildable due to railroad restrictions that have since been removed. He
EDA Meeting September 27, 2004
Page 3
also noted that the property has a reduced value due to its close proximity
to the railroad tracks.
Commissioner Sommer expressed support for the sale of the lot for $35,000.
He commented that the $35,000 price may be a fair price considering the
necessity of soil correction costs.
The EDA expressed support for the sale of the lot. Discussion ensued
regarding the $35,000 offer. Commissioner Cassen pointed out that the lot
value of $46,000 has likely increased since the 2002 appraisal. The EDA did
not believe it would be prudent to incur additional costs for an updated
appraisal or a soil correction analysis.
Staff was directed to consult the developer regarding the proposed soil
boring costs and to utilize the $46,000 appraisal as a basis for negotiation on
the lot price.
ADJOURNMENT
Motion was made by Commissioner Gwin-Lenth, seconded by
Commissioner Sommer, to adjourn the meeting. All present voted in favor.
Motion carried. The New Hope EDA adjourned at 8:50 p.m.
Respectfully submitted,
Valerie Leone
City Clerk
EDA Meeting September 27, 2004
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