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092704 EDAOfficial File Copy ---- CITY OF NEW HOPE EDA MEETING City Hall, 4401 Xylon Avenue North September 27, 2004 President Don Collier Commissioner Doug Andersen Commissioner Sharon Cassen Commissioner Mary Gwin-Lenth Commissioner Steve Sommer 2. 3. 4. o Call to order Roll call Approval of regular meeting minutes of September 13, 2004 Resolution regarding 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) Discussion and update regarding development proposal for the EDA owned property located at 7819 Angeline Drive (improvement project no. 603) Adjournment CITY OF NEW HOPE 4401 XYLON AVENUE NORTH NEW HOPE, MINNESOTA 55428 EDA Minutes Regular Meeting September 13, 2004 City Hall CALL TO ORDER ROLL CALL APPROVE MINUTES IMP. PROJECT 751 Item 4 EDA RESOLUTION 2004-32 Item 4 EDA Meeting Page 1 President Collier called the meeting of the Economic Development Authority to order at 8:40 p.m. Present: Don Collier, President Doug Andersen, Commissioner Sharon Cassen, Commissioner Mary Gwin-Lenth, Commissioner Steve Sommer, Commissioner Motion was made by Commissioner Andersen, seconded by Commissioner Gwin-Lenth, to approve the Regular Meeting Minutes of August 23, 2004. Voting in favor: Collier, Andersen, Cassen, Gwin-Lenth. Voting against: None; Absent: None. Abstained: Sommer. Motion carried. President Collier introduced for discussion Item 4, Resolution authorizing negotiation of an option for certain property within the Winnetka East ~Redevelopment (south portion of 7603 Bass Lake Road Extension) (improvement project no. 751). Kirk McDonald, community development director, stated that this resolution would give two property owners an option to purchase the 'bump out' lot described in the Request for Action if Phase 3 does not go forward. Mr. Steve Sondrall, city attorney, explained the contractual obligations to convey property to Ryland Homes. Mr. McDonald added that at the August 30 work session, council directed staff to work with the city attorney on preparing a resolution to address the 'bump out' lot. Commissioner Cassen introduced the following resolution and moved its adoption "RESOLUTION AUTHORIZING NEGOTIATION OF AN OPTION FOR CERTAIN PROPERTY WITHIN THE WINNETKA EAST REDEVELOPMENT (SOUTH PORTION OF 7603 BASS LAKE ROAD EXTENSION) (IMPROVEMENT PROJECT NO. 751)." The motion for the adoption of the foregoing resolution was seconded by Commissioner Sommer, and upon vote being taken thereon, the following voted in favor ,'.thereof: COllier, Andersen, Cassen, 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. September 13, 2004 IMP. PROJECT 734 Item 5 EDA Meeting Page 2 President Collier introduced for discussion Item 5, Discussion and update regarding concept plans for the proposed development of 4301-4317 Nevada Avenue North (improvement project no. 734). Mr. McDonald introduced Shawn Siders, community development spedalist. Mr. Shawn Siders detailed the proposed 6-unit townhome development and showed concept drawings of the site. Per the direction of the EDA, the plans deviate slightly from what was originally proposed as two of the proposed units are handicap accessible, rather than one. Staff is seeking preliminary approval of the proposed concept so the owner of 4301 and contract purchaser of 4317, Northwest Community Revitalization Corporation (NCRC) can proceed with developing the necessary documents to receive planning approval. Mr. Siders illustrated drawings of the two proposed triplexes and future plan. The plans meet the city's scattered site housing program requirements and would be owner-occupied. Construction would begin this winter with completion in spring/summer 2005. Commissioner Gwin-Lenth inquired as to the wide semi circle on the east side of the plan. Mr. Gene Nicolleli, project architect, explained that it represents a change in topography. ..Commissioner Cassen asked if the complex is considered twinhome, townhome, or triplex and if there will be an association. Ms. Kris Madson, executive director of NCRC, responded that it is a townhome complex and that a decision has not yet been made regarding an association. She explained that an association is problematic with a small number of units and they are looking into how the project may benefit from partnering with another association. Commissioner Cassen stated her concern about the common entrance, especially snow removal if there is not an association. Commissioner Cassen continued that if there is no association perhaps the units should front Nevada and be twinhomes with a series of use-in- common driveways. She asked the reason why the units do not face Nevada. Mr. Nicolleli answered that the goal was to be as efficient as possible in construction costs and land use. Commissioner Cassen asked about the status of the property at 4415 Nevada Avenue North to which Ms. Madson responded that no decision has been made yet. NCRC is considering the development at that property as a phase 2 acquisition and development. Commissioner Cassen remarked that if there is a phase 2 with additional townhomes, she would be more comfortable with the proposed · j.c0ncept. Otherwise the current proposal is too problematic and may not Serv~ the best interest of the city. If there is no association and no additional 'Property, she would not be in favor of the proposed concept. She asked if the project is financially feasible with five units instead of six. Ms. Madson September 13, 2004 IMP. PROJECT 776 Item 6 EDA Meeting Page 3 stated that five units may not be feasible. Commissioner Cassen questioned why there were not more one-level not accessible units to which Mr. Nicolleli responded that the proposed design is the most efficient use of the land while accounting for site improvement costs. Commissioner Cassen reiterated the need for more one-level homes in the city. Commissioner Sommer stated he likes the layout of the land but shares the concerns of Commissioner Cassen and agrees that it is too small for an assodation to take care of all maintenance. Commissioner Sommer stated that NCRC should consider an association that would only maintain the lawn, plow snow, and remove garbage, leaving the owners responsible for the exterior. Ms. Madson replied that NCRC is researching various alternatives for the association and understands the importance of proper maintenance. President Collier inquired as to the selling price. Ms. Madson stated it will be in the $155,000 to $165,000 range and will appraise higher. They haVe gap financing available for lower income buyers. Commissioner Cassen asked if a buyer could add amenities and was told yes. She emphasized that the owner should be able to make choices. President Collier introduced for discussion Item 6, Public Hearing - Resolution authorizing the transfer of real property (5501 Boone Avenue North) (improvement project no. 776). .Mr. Kirk McDonald, community development director, explained that this is a public hearing to consider approving the sale of the property located at 5501 Boone Avenue North to Project for Pride in Living, Inc. (PPL), for $1.00; At its meeting March 23, 2004, the EDA approved a term sheet between PPL and the city of New Hope. Total acquisition cost was $376,764. The city used $100,000 in CDBG funding to assist in the original acquisition of the site. The original EDA investment was $276,764.00. The original EDA investment will be reimbursed through the tax increment generated from the proposed $14.5 million development. Mr. McDonald explained that Item 6 has two parts: the Public Hearing and the resolution to transfer property to PPL. Item 7 considers the development contract. This project has been discussed many times. As a brief review, 5501 Boone Ave North was acquired by the city in 1993 through eminent domain. At that time, a project did not proceed. A number of proposals for that property had been submitted; however, none of those were finalized and the city-owned property remained vacant. In the spring of 2003, PPL submitted a development proposal for the site ..consisting of 70 housing units. Of these, 35 would be affordable rental units and 351 would be market rate owner-occupied condominium units. At that time the EDA directed the developer to consider adding additional market rate, owner occupied condominium units so that the number of owner September 13, 2004 EDA Meeting Page 4 occupied units is greater than the number of rental units. The developer responded to this request and proposed the construction of 41 market rate, owner occupied condominium units. The property is currently tax-exempt and will be taxable once the property is transferred to PPL. Once developed, the property will generate approximately $163,964 in annual tax revenue. If the property were to be developed as either a commercial or industrial project, it would generate approximately $90,000 in annual tax revenue. A portion of the proceeds from the TIF district will be used to reimburse the dty for the original land acquisition cost, plus interest as well as provide approximately $14,000 annually to assist the city with its redevelopment programs in administration fees. Any inflationary increases in market value will allow theTIF district to be decertified more quickly. Mr. Shawn Siders, community development specialist, gave a short presentation regarding the financial distinction between using the development of this property as a residential use as proposed by PPL versus an industrial/commercial use. The bottom line shows that residential use on this site will generate more tax revenue over 25 years and it's likely that the city will decertify the TIF district in less than 25 years. Commissioner Cassen thanked Mr. Siders for the comparison and stated commercial/industrial on this site is less sensible in the long run. Messrs. Steve Kramer and Chris Wilson from PPL stated that with this approval, PPL will start construction this fall and have the apartments fully leased by the end of 2005. They would move forward on the condos in ..spring 2005, completing them in the spring of 2006. Ms. Gay Greiter of Krass Monroe stated that the agreement adheres to the term sheet approved earlier this year. They are contemplating conveyance of land as soon as financing is in order for the apartments; the city is providing a grant of $550,000 for the apartments and up to $650,000 for the condos, to be provided when site improvements begin. Ms. Johnelle Opem, 2733 Zealand Avenue North, was recognized. She inquired about the certainty of getting funding for the condos and asked what guarantees are in place to protect the city if the funding is not secured. Ms. Greiter stated that the agreement stipulates that if funding is not secured, the city would be able to take back the site, which would already have ponding and grading completed. Mr. Martin Opem, 2733 Zealand Avenue North, was recognized. He stated that the financial comparison shows the residential option is a better deal than industrial/commercial, but it actually comes out a dead wash. He also · expressed concerns about other city services and felt that costs will be higher,.than anticipated. He emphasized that residents have stood before 'the EDA and Council and stated they do not want additional affordable apartments. Mr. Opem also commented on the water level and traffic on September 13, 2004 EDA Meeting Page 5 Boone Avenue North. He stated there are enough reasons not to let this project proceed. He stated he believes this project is a waste of city resources and should be stopped now. Mr. Andy Hoffe, 4632 Flag Avenue North, stated that by adding more high- density housing, the EDA is going against city goal 2. Mr. Hoffe inquired as to what would be developed adjacent to this site. He requested the EDA table this item and search for businesses to go into this area. Mr. James Fackler, 4031 Nevada Avenue North, was recognized. He noted he has been opposed to this project all along because even though the EDA says there is a tax advantage, New Hope has more than its share of affordable housing. Mr. Fackler suggested development of a park on this site if a business cannot be sought. Ms. Karen Nolte, 8232 Northwood Parkway, was recognized. She stated that according to local housing studies, the city should not consider additional affordable housing units as New hope has already approved the development of enough affordable units. Mr. Keith Pahl, 5432 Quebec Avenue North, was recognized. He stated that he drove this area of Boone in midday and had a hard time navigating with crowded streets and parking. He expressed concern regarding the impact this housing project will have on existing traffic conditions. At the request of President Collier, Vince VanderTop, assistant city ..engineer, addressed the storrnwater issue and parking on Boone. The needed adjustment can be made for stormwater. As for traffic, Boone is 42 feet wide for two lanes of traffic and parking on one side; the city could add bumpouts like 36· Avenue to slow the traffic. Although traffic will be heavier than it is now, it won't exceed the capacity of Boone, which is 10,000 vehicles per day. He stated that when Boone Avenue is scheduled for updating, the city will consider left turn lanes, etc. Due to the minimal amount of trips generated by this project, it is not necessary to consider upgrading Boone Avenue North at this time. President Collier explained that Carebreak wanted a PILOT (Payment in Lieu of Taxes). Under those terms, the EDA was supportive of conveying the property, but the business was sold and the new owners decided not to pursue adult daycare. Ms. Juanita Hoffe, 4632 Flag Avenue North, was recognized. She stated that some of the previous speakers do not intend to cast aspersions on individuals who rent. She believes the city did a good job of planning and · '~!e*el°ping:apartments, resulting in 49% of the housing units in New Hope .'being Xenter occupied. She expressed her support of PPL as a developer, yet Would prefer to see PPL help existing communities rather than developing commercial/industrial land. Ms. Hoffe stated her concern with the lack of September 13, 2004 dedicated park area on the PPL site as well as the Winnetka Green project. Ms. Hoffe stated that the developers should be required to develop park areas rather than provide a park dedication fee to the city. Ms. Hoffe reiterated the concerns of others regarding traffic on Boone Avenue. President Collier stated that he understands the traffic and parking concerns, however, this project will add a nominal number of new trips to Boone Avenue. President Collier stated that when Boone Avenue is upgraded in the future, the city will need to consider parking issues as well as the placement of traffic calming devices. PPL agrees that there will be families with kids and the project will have a playground. PPL has a great partnership in New Hope. PPL took troubled properties and improved them. Engineering will be successful on the points raised. The flow of income to the EDA and dty of $2.1 million is in addition to site improvements reimbursed through the TIF district. Commissioner Cassen added that there will be green space in both projects, as Elm Grove Park will be refurbished next to St. Raphael's. PPL on Bass Lake Road asked for a playground, the city paid half and there is a playground there now. Ms. Susanne Remus, 5432 Quebec Avenue North, was recognized. She stated that the placement of the storrnwater retention pond has decreased the size of the park area near Winnetka Green. Ms. Remus stated she feels the park size is unacceptable. She felt the dty unnecessarily replaced playground equipment to compensate for the loss of space. Ms. Nolte stated that apartments are a business and the dty should support the current apartment community by not granting approvals for additional rental units in New Hope. President Collier stated that a competitive rental market is advantageous for tenants. EDA Meeting Page 6 Commissioner Cassen reminded the audience that the city is considering redevelopment of the 60-unit apartment complex next to the golf course. The hope is that this PPL project would be complete when those 60 units are demolished. At that time, the city will be replacing 60 units with 35 units of which eight are eligible for section 8 subsidy. Commissioner Gwin-Lenth pointed out that not everyone in our community can afford a single-family home. Speakers tonight have talked about helping people be able to own their own home. Condominium units are .i.~ore' affordable than $300,000 to $350,000 single-family homes. It is neceSSary to develop a variety of housing types that will continue to serve 'all of the residents of New Hope including those that cannot afford a large single family home. September 13, 2004 MOTION Item 6 EDA RESOLUTION 2004-33 Item 6 IMP. PROJECT 776 Item 7 EDA RESOLUTION 2004-34 Item 7 EDA Meeting Page 7 Commissioner Cassen stated that many of the renters in New Hope are elderly and cannot afford a large single-family home on a fixed income. Commissioner Cassen expressed pride in the senior housing projects the city has approved. Commissioner Sommer stated his opposition to the PPL proposal. He indicated that New Hope has more than enough affordable housing and it needs to proactively recruit more commercial/industrial tax base. Commissioner Sommer stated that he has voted against this project in every instance except when PPL indicated that it did not need financial assistance from the city. Motion was made by Commissioner Cassen, seconded by Commissioner Grwin-Lenth, to close the public hearing. All present voted in favor. Motion carried. Commissioner Cassen introduced the following resolution and moved its adoption "RESOLUTION AUTHORIZING THE TRANSFER OF REAL PROPERTY (5501 BOONE AVENUE NORTH) (IMPROVEMENT PROJECT NO. 776)." 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: Collier, Cassen, Gwin-Lenth, and the following voted against the same: Andersen, Sommer; 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. President Collier introduced for discussion Item 7, Resolution authorizing execution and delivery of a contract for private redevelopment by and between the New Hope Economic Development Authority and Project for Pride in Living, Inc. for the redevelopment of 5501 Boone Avenue North (improvement project no. 776). Commissioner Cassen introduced the following resolution and moved its adoption "RESOLUTION AUTHORIZING EXECUTION AND DELIVERY OF A CONTRACT FOR PRIVATE REDEVELOPMENT BY AND BETWEEN THE NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY AND PROJECT FOR PRIDE IN LIVING, INC. FOR THE REDEVELOPMENT OF 5501 BOONE AVENUE NORTH (IMPROVEMENT PROJECT NO. 776)." 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: Collier, Cassen, Gwin-Lenth, and the following voted against the same: Andersen; .'..Sommer. 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. September 13, 2004 ADJOURNMENT Motion was made by Commissioner Sommer, seconded by Commissioner Gwin-Lenth, to adjourn the meeting. All present voted in favor. Motion carried. The New Hope EDA adjourned at 10:39 p.m. Eve Lomaistro Human Resources Coordinator EDA Meeting Page 8 September 13, 2004 EDA REQUEST FOR ACTION Originating Department Approved for Agenda Agenda Section Community Development 09-27-04 EDA Item No. By: Kirk McDonald By: RESOLUTION REGARDING 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) .REQUESTED ACTION Staff is requesting that the EDA approve a resolution regarding affirming support of the Winnetka Green Phase III expansion and authorizing staff to proceed with appraisals and relocation estimates and to continue work on the studies necessary to determine ehgibility of the eight Phase HI parcels for inclusion in the TiF District. The attached resolution was prebared by Krass Monroe, the city's financial consultant. A representative from Krass Monroe will be present to answer questions. POLICY/PAST PRACTICE The EDA routinely takes action on redevelopment projects that meet the goals of both the Comprehensive Plan and the City Plan. BACKGROUND An update on the proposed Winnetka Green Phase HI was presented at the August 9, 2004, EDA meeting. Since that time, staff coordinated a Winnetka Green neighborhood open house on August 25 and continued to coordinate on other aspects of the proposal. A special City Council meeting was also held on September 23 specifically to discuss the proposed expansion. ' If authorized, Forsythe Appraisals, who completed other appraisals in the project area, would complete the appraisals of the eight properties. The relocation estimates would be completed by Evergreen Land Services, the city's-relocation consultant. " ~. ::. SECOND BY h\RFA\PLANNING\Housin \East Winnetka Redevelo ment\Q- hase 3 affirmin su ort.doc . Request for Action Page 2 09-27-04 With the approval of this resolution, staff would continue working on the following tasks: Continue coordination with Krass Monroe and Ryland on finalizing the amended redevelopment contract and the TIF District modification. Coordinate the completion of appraisals and relocations estimates for the eight properties. · Continue coordination with Ryland on revised plans. · Coordinate on planning steps necessary to amend the PUD and plat. Staff will return to the EDA on October 11, 2004 to present an amendment to the redevelopment contract and to complete the required actions necessary for the TIF District modification. Staff recommends approval of the resolution. FUNDING As per the term sheet approved at the July 26, 2004, EDA meeting, Ryland Homes deposited $25,000 with the city to cover initial expenses related to the phase ti/expansion. The costs associated with the appraisals, relocation estimates ~and TIF ehgibility will be funded with these dollars. ATTACHEMENT · Resolution Section 2. Findinqs. 2.01 Assuming that the findings referred to in Section 2.02(2) can be made, the EDA hereby finds that Phase III promotes the objectives outlined in its Restated Redevelopment Plan for Redevelopment Project No. 1 established pursuant to Minnesota Statutes, Section 469.001 et seq. 2.02 The EDA intends to approve the Contract and authorize execution thereof provided that: (1) The Contract, in the form that it is presented to the EDA, shall be in substantial conformity with the Term Sheet approved by the EDA at its meeting on July 26, 2004, and (2) The appropriate findings can be made to permit modification of Tax Increment Financing District No. 03-1 (Special Law) (the 'q'lF District") pursuant to Minnesota Statutes, Section 469.174 et seq. and, as applicable, Laws of Minnesota 2003, l=t Special Session, Chapter 21, Article 10, Section 10, all as amended and supplemented from time to time, to include the Phase III pamels within the District. Section 3. Authorizations. 3.01 City staff are hereby authorized to engage Forsythe Appraisals, LLC to obtain appraisals for the eigh['properties located within Phase III. 3.02 City staff are hereby authorized to engage Evergreen Land Services Company'to obtain relocation estimates for the eight properties located within Phase III. 3.03 City staff are directed to continue to work with Short Elliott Henddckson Inc. to complete the studies necessary to determine the eligibility of the Phase III parcels for inclusion in the TIF District. Adopted by the EDA this day of ,2004. ATTEST: ~aniel J. Donahue, Executive Director G:\WPDATA\N\NEW HOPE'~26~DOC\EDA RESOL RE REDEV AGR,DOC Don Collier, President NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY COUNTY OF HENNEPIN STATE OF MINNESOTA RESOLUTION NO. A RESOLUTION REGARDING 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) BE IT RESOLVED by the New Hope Economic Development Authority (the "EDA") as follows: Section 1. Recitals. 1.01 Ryland Homes of The Ryland Group, Inc. (the "Redeveloper") is currently constructing Phases I and II of the Winnetka Green redevelopment project on Winnetka Avenue North. 1.02 The EDA is considering the addition of a proposed Phase III to Winnetka Green ("Phase II1")which would be constructed on the following parcels, together with any City rights-of-way which would have to be vacated between or adjacent to the parcels: Street Address 5509 Sumter Ave N 5510 Sumter Ave N Property Identification Number 05-118-21-33-0086 05-118-21-33-0099 05-118-21-33-0030 05-118-21-33-0098 05-118-21-33-0097 05-118-21-33-0096 05-118-21-33-0095 05-118-21-33-0094 5501 Sumter Ave N 7708 55th Ave 7700 55th Ave 7624 55th Ave 7616 55th Ave 7608 55th Ave "1.03' it has be'-en' propOSed that the EDA enter into a Contract for Private' Redevelopment (the "Contract") with The Ryland Group, Inc. relating to the Phase III ,~.amels. EDA REQUEST FOR ACTION Originating Department Approved for Agenda Agenda Section Community Development 09-27-04 EDA Item No. By: Kirk McDonald, Director of CD By: Shawn Siders, CD Specialist 5 DISCUSSION AND UPDATE REGARDING DEVELOPMENT PROPOSAL FOR THE EDA OWNED PROPERTY LOCATED AT 7819 ANGELINE DRIVE (IIvIPROVEMENT PROJECT FILE NO. 603). REQUESTED ACTION :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 has recently received an inquiry for a private market sale of the property for the development of a single-family home. POLICY/PAST PRACTICE City goal #2 is to emphasize the maintenance and redevelopment of commercial and residential properties within the city. The EDA has been addressing the residential portion of this goal through the city's many housing activities. In the past, the city has sold property based upon appraised values and acceptable development proposals. BACKGROUND At its meeting of February 2, 1999, the New Hope Economic Development Authority authorized the purchase of the property located at 7819 Angeline Drive from Hennepin County. The property was forfeited to the county due to nonpayment of taxes. The EDA acquired the site 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. On April 22, 2002, the city council approved an appraisal and survey of the property located at 7819Angeline Drive. This action was taken in response to a development proposal submitted by SLP Investments, Inc. for the potential sale and development of this property. The survey of the property was completed and the appraisal indicated that the property had a fair market value of $46,000. Ultimately, SLP, Inc. chose not to develop this site because a purchase agreement for the adjoining vacant lot (7813 Angeline Drive) could not be agreed upon between SLP and. that property owner. MOTIOI~I._.By. SECOND BY I:\RFA\PLANNING\Housin \7819\Q-7819 EDA U date 9-27-04.doc "'- ~ Request for Action Page 2 September 27, 2004 At the meeting of. April 22, .2002, the city council did not authorize two soil borings for this property. The city was advised by its engineer that it would be prudent to perform soil borings, however, the city council indicated that the responsibility of conducting soil borings should be at the expense of the developer, after the property was transferred to the developer. 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. A conceptual site plan, building elevations and color photographs of the style of home proposed for construction are attached for your convenience. This developer has constructed numerous homes on sites with environmental and other site constraints. For example, Mr. Long constructed two homes in Faribault that adjoined a swamp. There were numerous site remediative actions that were necessary in order to construct these homes. Mr. Long has constructed numerous models that are similar to the unit he proposes for development in New Hope. The developer has offered to purchase the lot for $35,000. The applicant indicates that the $35,000 lot price was calculated by considering what the potential purchaser can afford with the site improvements that are being proposed. The city has not been actively marketing this property. City staff have provided information regarding this parcel to developer inquiries coricerning the availability of vacant lots in the dty. REQUESTED ACTION Staff seeks direction from the EDA on the following items: 1. Determine the interest of the EDA to sell this property for the construction of a single-family, market rate owner occupied home; 2. To determine whether or not the EDA would like to accept the enclosed proposal or direct staff to actively market this site to multiple developers; 3. If the EDA finds this proposal acceptable, what actions should be taken by staff to finalize the transfer of property. Staff will be presenting a single development proposal to the EDA for its consideration. As noted, the city is not actively.marketing_this site f..or potenti~ development. If the EDA would rather actively market this site, this process could'-be more time corks, uming and expend additional resources that may not be necessary. Ultimately, all funds expended to market this site will be recovered from the proceeds of the sale, however, the am0~xnt of proceeds that are directed as income to the EDA may be reduced as it will be necessary to cover the costs associated with the potential marketing and advertising. If the EDA would prefer to negotiate with the proposed developer and not actively market the site, city staff seeks direction with respect to what actions should be taken by staff to finalize the sale of this property. As Request for Action Page 3 September 27, 2004 previously noted,, an appraisal was completed in 2002 that indicated the fair market value of the site is $46,000. If directed by the EDA, staff will order an updated appraisal for further consideration by the EDA. If the EDA would like to complete an updated appraisal, staff will schedule a resolution towards that end for the EDA's consideration at its meeting of October 11, 2004. If the EDA chooses not to proceed with a new appraisal, city staff requests direction with respect to the proposed purchase price submitted by the applicant. 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 or may not need to be completed. If the EDA finds the proposed purchase price acceptable, city staff will schedule a resolution authorizing a public hearing for the transfer of this property for the EDA meeting of October 11, 2004. If the proposed purchase price is not acceptable and the EDA does not want to order an updated appraisal, city staff will enter into negotiations with the applicant, based upon the direction provided by the EDA. FUNDING EDA funds would be used to pay for all costs necessary to transfer the property and would be repaid upon closing. Currently, the property is vacant and tax exempt. The applicant has indicated that the value of the house will be approximately $180,000 - 200,000. It is anticipated that this property would generate approximately $2,500 - $3,000 in annual tax revenue. ATTACHMENTS · Letter from Kingsman, LLC Concept site plan Front, Rear and Side Yard elevation plan(s) · Floor layout plan · Color photographs of similar home KINGSMAN Kingsman LLC 3512 Hampshire Ave N Crystal MN 55427 Ph 612-382 -9454 Toll flee fax 1-866-554-6110 SEP September 21, 2004 Kirk McDonald City of New Hope 4401 Xylon Ave N New Hope MN 55428 Re: 7819 Angeline Drive Lot 24 Block 5 JP RIEDEL & CO ST RAPHAEL ADDN Dear Kirk and city council members, Kingsman is requesting to purchase this property for new construction of a single-family residence. A resident has already been identified and would like to be able to move into the house on Decemb~ 1, 2004. Kingsman is requesting a purchase price of the lot for $35,000. This price was chosen so that the resident will be able to afford the house when completed. A copy of the house plans is included along with pictures of the home. This will be a rambler style house three bedrooms and two bathrooms finished. The main level will have 970 square feet and a total of 1225 finished square feet. Peter Long the owner of Kingsman LLC got started in the construction industry in 1983 framing new houses while going to college at the University of Minnesota. Kingsman LLC was formed in 2001 and has primarily focused on construction of single-family residences in the starter family price bracket. Please contact me if you have any questions. President 18~00 N 62'59 20"I!w ' 15.00 s / / I I -I I I ~ \ BD~ICH~I~J~ TOP 0~' RE--BN~ ELEV. 90a.26' ./ - DRAINAG~ EASE)JENT PER I ; I ! JUN-17-2004 THU 12:18 PI~ C-EROLD BROS CONSTRUCTION F~ NO. 9527584070 P. 01 FI~ONT ' ELEVRT ION JUN-17-2004 THU 12:17 PM GEROLD BRO~ CONSTRUCTION FAX NO. 9527584070 P. 04 FIRST FLOOR PLRN m'~ .~,m',~ " '- -. ~ n ~ · ~'e. JUN-17-2004 THU 12:~8 PM C, EROLD BROS CONS~UOTION F~ NO. 9527584070 P. 03 FOUNDATION PLAN JUN-17-2004 THU 12:18 PM GEROLD BROS CONSTRUCTION NO. 9527584070 I i I--'" I ~ I I----I I ! BRCK ELEVRTION JUN-17-2004 THU 12:17 PM GEROLD BROS CONSTRUOTION F~ NO. 9527584070 P. 05 RSPHFLT VINYl,,. U~P S;)N6 LEFT ELEVRTION VII~YL ~RP I~RHRLT ~"1 f#~l.~ ~..~ m ~.I RISHT ELEVRTION