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072792 EDAOFFICIAL FILE COPY CITY OF NEW HOPE EDA AGENDA EDA Regular Meeting #10 Agenda #11 President Edward J. Erickson Commissioner W. Peter Enck Commissioner Gary L'Herault Commissioner Gerald Otten Commissioner Marky Williamson July 27, 1992 2. 3. 4. Call to Order Roll Call Approval of Minutes of June 22, 1992 Resolution Approving 1992 Amendment to Redevelopment Plan 82-1 and Tax Increment Financing Plan 82-1 and Requesting Approval of City Council Discussion Regarding City-Owned Property at 7305 42nd Avenue North - All Star Sports/Valvoline Rapid Oil Change (#492) 6. Adjournment Approved EDA Minutes Meeting #9 CITY OF NEW HOPE 4401 XYLON AVENUE NORTH HENNEPIN COUNTY, MINNESOTA 55428 June 22, 1992 CALL TO ORDER ROLL CALL APPROVE MINUTES CITY-OWNED PROPERTY AT 7305 42ND AVE N (#492) Item 4 ACQUISITION OF 5501 BOONE AVE NO Item 5 PROJECT #493 New Hope EDA Page 1 President Erickson called the meeting of the Economic Development Authority to order at 9:00 p.m. Present: Erickson, Enck, L'Herault, Otten, Williamson Motion was made by Commissioner Enck, seconded by Commissioner L'Herault, to approve the EDA minutes (Regular and Executive Session) of June 8, 1992. Ail present voted in favor. Motion carried. President Erickson introduced for discussion Item 4, Discussion Regarding City-Owned Property at 7305 42nd Avenue North - Ail Star Sports/Valvoline Rapid Oil Change (#492). Mr. Donahue reported to the EDA that the City is discussing the purchase and development of the City-owned property next to Ail Star Sports. Jerry Norman of Ail Star Sports is working with Olson Concrete to put a development together. There is,the potential for a tenant for that building if it is built. Mr. Donahue requested time to explore the possibile development. Mr. Donahue said that Ail Star Sports will be asking for some City assistance, principally tax increment financing dollars. Mr. Donahue stated he informed Mr. Norman that the City would have to justify any public dollars or tax increment dollars going into the project and the City would have to analyze and recommend to Council what might be workable or feasible. City Council directed staff to inform Ail Star Sports to bring a firm proposal back to the July 27 Council Meeting and Council will make a decision on the issue at that time President Erickson introduced for discussion Item 5, "RESOLUTION AUTHORIZING ACQUISITION OF 5501 BOONE AVENUE NORTH BY EMINENT DOMAIN PROCEEDINGS (#493). Mr. Donahue explained that 5501 Boone Avenue North is the vacant property between the City garages and North Ridge. June 22, 1992 EDA RES. 92-04 Item 5 ADJOURNMENT The City is putting together a planned project for this property. Mr. Donahue said part of that development requires this property and the City has been in negotiation with the owner for some time and the owner is not willing to accept what the City considers a fair and viable offer. Mr. Donahue said if the City wishes to go forward with the project, he is recommendihg that eminent domain proceedings begin and decide within the next 90 days if the project is to proceed and if it is a quick take or conventional type of eminent domain. Mr. Donahue said if it is quick take and the project comes together, construction could probably start in the fall. President Erickson explained that on July 1, North Ridge staff, staff from the City of New Hope, and the Director of North Memorial will be meeting to discuss the possibility of constructing a hospice building and an adult daycare building on the property in question. President Erickson stated that this property is a very major part of the construction of these two facilities. President Erickson introduced the following resolution and moved its adoption: "RESOLUTION AUTHORIZING ACQUISITION OF 5501 BOONE AVENUE NORTH BY EMINENT DOMAIN PROCEEDINGS (#493)". The motion for the adoption of the foregoing resolution was seconded by Commissioner Enck, and upon vote being taken thereof; the following voted in favor thereof; Erickson, Enck, L'Herault, Otten, 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 was made by Commissioner Williamson, seconded by Commissioner Enck, to adjourn the meeting. Ail present voted in favor. The New Hope EDA adjourned at 9:10 p.m. Respectfully submitted, Valerie Leone City Clerk New Hope EDA Page 2 June 22, 1992 ~U~ REQUF~T FOR ACTION O~ginating Depaament Approved ~rAgenda Agenda Section City Manager July 27, 1992 EDA Kirk McDonald Item No. Management Assistant By: By: 4 RESOLUTION APPROVING 1992AMENDMENT TO REDEVELOPMENT PLAN#82-1AND TAX INCRF2~ENT FINANCING PLAN #82-1 AND REQUESTING APPROVAL OF CITY COUNCIL The public hearing that the City Council will be conducting on this subject is to consider amendments to the: 1. Amended Redevelopment Plan #82-1 (the Redevelopment Plan), 2. Amended Redevelopment Project #82-1 (the Redevelopment Project), and 3. Amended Tax Increment Financing Plan #82-1 (the Financing Plan) of the New Hope Economic Development Authority. In the attached resolution, the EDA is requesting approval of the amendments by the City Council. The City Attorney recommends tha-t this resolution be adopted by EDA prior to the adoption of the similar resolution by the City Council. Staff recommends approval of the resolution approving '1992 amendment to Redevelopment Plan #82-1 and Tax Increment Financing Plan #82-1 and requesting approval of City Council. I Renew: Admlnl~rat~n: Finance: RFA-OO1 ~ CERTIFICATE NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY I, the undersigned being the duly qualified Executive Director of the New Hope Economic Development Authority, hereby attest and certify that: 1. As such officer, I am the recording officer of the New Hope Economic Development Authority and have the legal custody of the original record from which the attached resolution was transcribed. 2. I have carefully compared the attached resolutio~ with the original record of the meeting at which the resolution was acted upon. 3. I find the attached resolution to be a true, correct and complete copy of the original: EDA RESOLUTION NO. 92- Resolution Approving 1992 Amendment to Redevelopment Plan 82-1 and Tax Increment Financing Plan 82-1 and Requesting the Approval of the City Council 4. I further certify that the affirmative vote on said resolution was ~ ayes, ~ nayes, and ~ absent/abstention. 5. Said meeting was duly held, pursuant to call and notice thereof, as required by law, and a quorum was present. · WITNESS my hand officially as such Executive Director this ~ day of ,1992. Daniel J. Dona.hue, Executive Director Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. 92- RESOLUTION APPROVING 1992 AMENDMENT TO REDEVELOPMENT PLAN 82-1 AND TAX INCREMENT FINANCING PLAN 82-1 AND REQUESTING THE APPROVAL OF THE CITY COUNCIL BE IT RESOLVED, by the New Hope Economic Development Authority (the "EDA"), as follows: 1. Proposed Amendment. The Housing and Redevelopment Authority in and for the City of New Hope, Minnesota (the "H1RA") has approved a redevelopment plan, as defined in Minnesota Statutes, Section 469.002, subdivision 16, designated as Redevelopment Plan 82-1 ("Redevelopment Plan 82-1"), and a redevelopment project to be undertaken pursuant thereto, as defined in Minnesota Statutes, Section 469.002, subdivision 14, designated as Redevelopment Project 82-1 ("Redevelopment Project 82-1"), and that in order to finance the public redevelopment costs to be incurred by the HRA in connection with Redevelopment Plan 82-1 and Redevelopment Project 82-1, the HRA has approved a tax increment financing plan, pursuant to the provisions of Minnesota Statutes, Section 469.175, designated as Tax Increment Financing Plan 82-1 ("Financing Plan 82-1"), which establishes a tax increment financing district, as defined in Minnesota Statutes, Section 469.174, subdivision 9, designated as Tax Increment Financing District 82-1 ("District 82-1") which is designated by Hennepin County as Tax Increment Financing Districts Nos. 1603 and 1604. Pursuant to Minnesota Statutes, Section 469.094, subdivision 2, the City has transferred control of Redevelopment Plan 82-1, Financing Plan 82-1 and District 82-1 from the I-IRA to the EDA. It' has been proposed that the EDA approve an amendment to Redevelopment Plan 82-1 and Financing Plan 82-1 which is entitled" 1992 Amendment to Redevelopment Plan 82- 1 and Tax Increment Financing Plan 82-1" (the "1992 Amendment") to expand the area subject to Redevelopment Plan 82-1 and to authorize the expenditure of tax increment revenue derived from District 82-1 to pay a portion of the public redevelopment costs in the additional area subject to Redevelopment Plan 82-1 by the 1992 Amendment and with respect to property adjoining such additional area which is already subject to Redevelopment Plan 82-1. 2. Approval of 1992 Amendment. The 1992 Amendment which has been presented to this Board and is ordered placed on file in the office of the Executive Director of the EDA, and the 1992 Amendment is hereby approved. The 1992 Amendment further serves the original goals and purposes of the City and HRA in approving Redevelopment Plan 82-1, Redevelopment Project 82-1 and Financing Plan 82-1, by developing property in the City and providing facilities which will be of benefit to all residents of the City. 3. Presentation to City Council. The 1992 Amendment hereby approved shall be presented to the City Council for a public hearing thereon pursuant to Minnesota Statutes, Section 469.029, subdivision 6 and Section 469.175, subdivision 4. Dated the 27th day of July, 1992. President Attest: Executive Director CORRICK LAW OFRCE~, PA. WILLIAM J. CORRICK STLmV~N A. SONDRALL, P.A. STEVEN A~ONORAII MICHAEL R. L~FLEUR MARTIN p MALECHA WILLL&M C. STRArT CORRICK & SONDRALL A PAFITNER~HIP OF PROFE~:~NA~. COf:IPORATION8 Edinburgh Executive Office Plaza 8525 Edinbrook Crossing Suite #203 Brooklyn Park, Minnesota 55443 TELEPHONE (612) 425-5671 FAX (612) 425-5~7 LAVONNE E. KE~(~ SHAI~ION O. OEF~Y July 21, 1992 Kirk McDonald Management Asst. City of New Hope 4401Xylon Avenue North New Hope, MN 55428 RE: 1992 Amendment to Redevelopment Plan 82-1 and Tax Increment Financing Plan 82-1 (North Ridge Adult Day Care Project) Dear Kirk: Please find enclosed the following Resolutions for consideration at the July 27th, 1992 Council meeting and EDA meeting in connection with the referenced matter. Also enclosed is the Amendment to Redevelopment Plan and Tax Increment Financing Plan 82-1. EDA Resolution Approving 1992 Amendment to Redevelopment Plan 82-1 and Tax Increment Financing Plan 82-1 and Requesting the Approval of the City Council. City Council Resolution Approving 1992 Amendment to Redevelopment Plan 82-1 and Tax Increment Financing Plan 82-1 and Making Findings with respect thereto. I would recommend that when we get to this item on the City Council agenda that the City Council meeting be suspended and that we go to the EDA meeting so that the EDA Resolution is adopted prior to the City Council Resolution. Procedurally, I believe this is the correct way to handle adoption of the Resolutions. It is also my understanding that our bond counsel, Jerry Gilligan, is correcting page 2 of the Amendment to reflect changes in the budget for expenditures of tax increment that we previously discussed. Hopefully that modification will be provided prior to the Council meeting. If it is not, there should be some indication on the record to publicly indicate a change in that budget. Mr. Kirk McDonald July 21, 1992 Page 2 If you have any further questions, please do not hesitate to contact me. Very truly yours, Steven A. Sondrall slt2 Enclosures cc: Oanie] J. Donahue Va]erie Leone Jerry Gilligan, Esq. 33-1-42-66- §9- 49 SQUARE DE FfEE~$ DORSEY & WHITNEY 2~00 FIRST B~NK P~CE EAST 5IINN~POLIS, ~INNESOTA 55402-1498 (Otg) 340-2600 TELEX 29- 060~ F~ (612) 340-~868 dEROM~ P. GILUGAN (612] 340-29~2 July 20, 1992 JUL 2 0 ~992 406 ) 252 - OOOO MI~I~OULA., MONTANA 59U0~ { ~ ) 721 - 60~5 31~ ) a83-1000 Mr. Steven Sondrall Corrick & Sondrall Edinburgh Executive Office Plaza, Suite 203 8525 Edinbrook Crossing Brooklyn Park, Minnesota 55443 Re: 1992 Amendment to Redevelopment Plan 82-1 and Tax Increment Financing Plan 82-1 (North Ridge) Dear Steve: Enclosed is the 1992 Amendment to Redevelopment Plan 82-1 and Tax Increment Financing Plan 82-1, together with resolutions of the New Hope EDA and City Council approving the Amendment. In 1989 the Redevelopment Plan was amended to include 5501 Boone Avenue North in the area subject to the Redevelopment Plan (but not in Tax Increment Financing District No. 82-1). This Amendment includes in the Redevelopment Plan the area immediately adjacent to 5501 Boone Avenue North, and authorizes the expenditure of tax increment from Tax Increment Financing District 82-1 established by Tax Increment Financing Plan 82-1, to finance public redevelopment costs of developing such additional property and 5501 Boone Avenue North for use as a senior day care center and hospice. Included in the Amendment is an estimate of such public redevelopment costs. Please review these documents and call me if you have any questions or comments. Yours truly, ?om/P.':' -" Gillig~n, JPG:cmn Enclosures 350 PARK · ~EW YOI/X, N~W yORK 100°~ 3~ SQUAR~ D~ DORSEY & WHITNEY 2200 FIRST BANK PL,&CE EAST MINNEAPOLIS, MINNESOTA 55402-i498 (612) 340- 2600 TELEX 99-O60~ JEROME P. G~r.TC, AN (6~z) 340-21~2 July 21, 1992 20! FIRST AVENUE, S. W. SUITE 3.10 ROCHI~STER, ~IL'INESOTA 55902 (507) 388- ~or D*W DSO~ ( ~ ) 721 - 602~ Mr. Steven Sondrall Corrick & Sondrall Edinburgh Executive Office Plaza, Suite 203 8525 Edinbrook Crossing Brooklyn Park, Minnesota 55443 Re: 1992 Amendment to Redevelopment Plan 82-1 and Tax Increment Financing Plan 82-1 (North Ridge) Dear Steve: Enclosed is a revised page 2 to the 1992 Amendment to North Ridge Redevelopment and TIF Plan. As we discussed in our .telephone conversation, I have amended the budget on page 2 in accordance with the information given to me by Kirk after his conversation W. ith Dan. Please call me if you have any questions or Comments. Yours JPG:cmn Enclosures 1992 AMENDMENT TO REDEVELOPMENT PLAN 82-1 AND TAX INCREMENT FINANCING PLAN 82-1 (NORTH RIDGE) NEW HOPE ECONOMIC DEVELOPMENT AUTHORITY I. INTRODUCTION The Commissioners of the Housing and Redevelopment Authority in and for the City of New Hope, Minnesota (the "HRA") and the City of New Hope, Minnesota (the "City"), have previously approved Redevelopment Plan 82-1 ("Redevelopment Plan 82-1") and Redevelopment Project 82-1 ("Rei:ievelopment Project 82-1") to be undertaken pursuant thereto, and in order to finance the public redevelopment costs to be incurred by the City and the HRA in connection with Redevelopment Plan 82-1 and Redevelopment Project 82-1, the HRA and the City have approved Tax Increment Financing Plan 82-1 ("Financing Plan 82-1"), which establishes Tax Increment Financing District No. 82-1 which is designated by Hennepin County as Tax Increment Financing Districts Nos. 1603 and 1604 ("District 82-1"). The HRA and City have also approved amendments to the Redevelopment Plan 82-1, Redevelopment Project 82-1 and Financing Plan 82-1. Pursuant to Minnesota Statutes, Section 469.094, subdivision 2, the City has transferred control of Redevelopment Plan 82-1, Redevelopment Project 82-1, Financing Plan 82-1 and District 82-1 from the HRA to the New Hope Economic Development Authority (the "EDA"). It has been proposed that additional property be included in the area subject to the Redevelopment Plan 82-1 and that public redevelopment costs incurred by the City and EDA in connection with the development and redevelopment of such additional property and property adjacent thereto which is already included in Redevelopment Plan 82-1 be paid from tax increment derived from District 82-1. The Additional Property to be included in Redevelopment Plan 82-1 is as follows: Street Address and PIN: 5555 Boone Avenue North (06-118-21 34 0006) Legal: Lot 2, Block 2, Science Industry Center - the north 150 feet. Street Address and PIN: ' 5425 Boone Avenue North (06-118-21 34 0010) Legal: Lot 2, Block 2, Science Industry Center - that part of Lot 2 lying North of the South 339.88 feet thereof and South of the North line of Lot 2, Block 2 extended east. (the "Additional Property"). By this Amendment the Commissioners of the EDA amend Redevelopment Plan 82-1, Redevelopment Project 82-1 to include the Additional Property in the area subject to Redevelopment Plan 82-1 and authorizes the expenditure of tax increment revenues derived from District 82-1 for public redevelopment costs incurred by the City or EDA in connection with the development and redevelopment of the Additional Property and 5501 Boone Avenue North which is located adjacent to the Additional Property and is already included in the area subject to Redevelopment Plan 82-1. This Amendment does no.t. include the Additional Property in District 82-1. This Amendment is approved by the Commissioners of the EDA and the City pursuant to Minnesota Statutes, Chapter 469.029, subdivision 6, and Minnesota Statutes, Section 469.175, subdivision 4. II. ~TATEMENT OF NEED AND OBIECTIVES The inclusion of the Additional Property in the area subject to Redevelopment Plan 82-1 will aid in the redevelopment of the Additional Property irt accordance with Redevelopment Project 82-1 and in a manner beneficial to the residents of the City and consistent with the objectives of the EDA as stated in Redevelopment Plan 82-1 all of which will meet the needs specified in Redevelopment Plan 82-1. III. ADDITIONAL EXPENDITURE OF TAX INCREMENT It is proposed that the Additional Property and 5501 Boone Avenue North be acquired by the EDA and sold to a private developer for construction thereon of a facility for use as a senior day care center and hospice. The estimated public redevelopment costs that are proposed to be paid by the EDA or City with respect to development of the Additional Property and 5501 Boone Avenue North from tax increment derived from District 82-1 are as follows: Land Acquisition Sitework and Public Utilities Contingency Administrative $ 800,000 300,000 100,000 50,000 $1,250,000 The use of tax increment derived from District 82-1 to pay the costs of the public redevelopment costs with respect to the Additional Property and 5501 Boone Avenue North described herein is hereby authorized. Such costs may be paid directly from tax increment derived from District 82-1, or may be paid indirectly from tax increment derived from District 82-1, by the payment of debt service on a loan or loans made by the City to the EDA to finance such cost. Any such loan made by the City will be repaid, with interest, from the tax increment derived from District 82-1. Other than the loan or loans from the City to the EDA, it is not expected that any obligations will be issued by the City or EDA to finance such costs. IV. FISCAL AND ECONOMIC IMPLICATIONS OF ADDITIONAL EXPENDITURES It is estimated fiscal and economic implications of the additional expenditures of tax increment revenue derived from District 82-1 authorized by this Amendment will be as follows; -2- The local governmental units other than the City which are authorized by law to levy ad valorem property taxes in the area where District 82-1 is located are Independent School District No. 281, Hennepin County, the I-IRA, the EDA, and various metropolitan area authorities, including the Metropolitan Council, the Metropolitan Transit Commission, the Metropolitan Airports Commission and the Metropolitan Mosquito Control District (the local government units). After the establishment and during the continuation of District 82-1, as a result of Redevelopment Project 82-1 and the implementation of Redevelopment Plan 82-1 and the improvements in District 82-1 there has been an increase in the tax capacity of the taxable property in District 82-1. If the tax increments derived from District 82-1 are not applied to pay the public redevelopment cost of the Additional Property and 5501 Boone Avenue North described herein, District 82-1 would terminate approximately two (2) years earlier than would otherwise be tt'.e case assuming ad valorem taxes are paid with respect to the taxable property in District 82-1 in the anticipated amounts. Upon such termination such increased tax capacity would be available for taxation by the local governmental units. However, as a result of this Amendment such increase intax capacity will not be available for taxation by the local governmental units until approximately two (2) years later. Offsetting such later termination of District 82-1 will be an increase in tax capacity to the Additional Property and 5501 Boone Avenue North as a result of the development of a senior day care center and hospice thereon. Since the Additional Property and 5501 Boone Avenue North are not included in District 82-1, such increase in tax capadty will be available for taxation by the City and the local governmental units. V. DETERMINATIONS IN ORIGINAL FINANCING PLAN The determinations made in Finandng Plan 82-1 with respect to designation of District 82-1 as a Redevelopment District and Housing District, the impact of the establishment of District 82-1 and the implementation of Redevelopment Plan 82-1 and undertaking of Redevelopment Project 82-1 and the captured assessed value of District 82-1 upon the redevelopment thereof are not affected by this Amendment and such determinations remain in full force and effect following the adoption of this Amendment. VI. ADDITIONAL AMENDMENTS TO PLAN. The City and the EDA reserve the right to alter this Amendment and to further amend or modify Redevelopment Plan 82-1 and Financing Plan 82-1 by their joint action, subject to the provisions of state law regulating such action. -3- VII. ORIGINAL PLAN Redevelopment Plan 82-1 and Financing Plan 82-1, except to the extent provisions thereof are explicitly amended or supplemented by this Amendment shall remain in and be in fUll force and effect. FAX 612 340 2644 DORSEY WI4ITNEY N o COUNW~ i~OAO $ (43N01 AVF,, N)I Redavelopmen~ Plan Area 82-1 in which incremen= may bm expen~e~ · T 0 F"l 612 340 2644 DORSEY WHITNEY m ,,No, Tax Incre~en~ D£~tzict No. Area from which i~crement may be colleoted PARK ~o 5700 V I CT ORY' PARK C)~IVE PUBLIC ,RKS ;ARAGE CENTER RD-" 5500 . NORTH RIDGE CARE ,.~5o CENTER ' ~$oo TH. ~LI N HOSTE. RMAN JR HIGH SCHOOL 5$TH AVl:'. BEGIN PARK ~07 AVE. REQUEST FOR ACTION Originating Department Approved for Agenda Agenda Section City Manager ~ EDA 27- 92 Item No. Kirk McDonald B-'/1 / 5 By: Management Assistant Y'~// DISCUSSION REGARDING CITY-~WNED PROPERTY AT 7305 42ND AVENUE NORTH - ALL STAR SPORTS/VALVOLINE RAPID OIL CHANGE (#492) The City has received proposals from two interested businesses, All Star Sports and Valvoline Rapid Oil Change, to develop the City- owned property at 7305 42nd Avenue North. The discussion on the appropriate use and development of this property has been on-going since the fall of 1991, and the City Council/Economic Development Authority has determined that it would like to reach a decision on the use and future development of the property at the July 27th EDA meeting. The enclosed material is intended to provide background information on the parcel, discuss the zoning implications of each use, determine the increments to be generated from the different developments, review the status of the 42nd Avenue Tax Increment District to determine if more than one business could be positively impacted by the development (Universal Color Lab and AutohaUs), and to discuss the appropriate"amount of TIF subsidy for the project. Review: Administration: Finance: RFA-O01 ~ CITY OF NEW HOPE MEMORANDUM DATE: TO: FROM: July 24, 1992 Dan Donahue, City Manager Kirk McDonald, Management Coordinator Assistant/Community Development SUBJECT: City Property Located at 7305 42nd Avenue North The City has received proposals from two interested businesses, Ail Star Sports and Valvoline Rapid Oil Change, to develop the City-owned property at 7305 42nd Avenue North. The discussion on the appropriate use and development of this property has been on-going since the fall of 1991 when a purchase offer on the property was made by Valvoline Rapid Oil, however the City had been discussing possible expansion by All Star Sports on that parcel over the last several years. The City Council/Economic Development Authority has determined that it would like to reach a decision on the use and future development of the property at the July 27th EDA meeting. The purpose of this memorandum is to analyze both proposals, provide background information on the parcel, discuss the zoning implications of each use, determine the increments to be generated from the different developments, review the status of the 42nd Avenue Tax Increment District to determine if more than one business could be positively impacted by the development (Universal Color Lab and Autohaus), and to discuss the appropriate amount of TIF subsidy for the project. 1. Proposals Rapid Oil is proposing to construct a 2-bay oil change facility that would contain about 2,000 square feet (main floor and pit) with a total valuation (including building, land, Land site improvements) of about $300,000. The facility would handle oil changes, lube changes, cooling systems, brake fluid changes, etc. No gasoline or mechanical work would take place at the site and the building would be similar to one located on Bass Lake Road. Valvoline has offered $75,000 for the property and is requesting no public assistance. All Star Sports is proposing to construct a one-story addition that would attach to their existing building. The exterior would be decorative concrete block to match the existing building. The interior would contain a vestibule, providing an entrance to the new or existing building, a ramp with handicapped accessible restrooms, and retail space. The new addition would contain about 2,720 square feet and the existing building contains 2,960 square feet, bringing the total new building size to 5,680 square feet. Total estimated cost of the addition (including building, land , site work and soft costs) is $210,000. All Star has tentatively offered $50,000 for the vacant parcel and is requesting about $100,000 in TIF assistance. 2. Zoning Implications In 1990, the majority of B-3 Auto-Oriented Zoning District properties on 42nd Avenue North between Louisiana and Winnetka Avenues were rezoned to B-4 Community Business District. It was determined at that time that the nature of the area had changed over the past several years from an auto-oriented type zoning district to a commercial/retail type zoning district. It was felt that the potential for quality redevelopment in the area would increase if the types of uses permitted were shifted away from the B-3 Auto-Oriented use to a commercial/ retail use. The rezoning of the properties on 42nd Avenue was seen as a logical extension of the commercial zoning at the City Center Shopping Center. The rezoning brought several non-conforming properties, such as All Star Sports which was zoned B-3, into conformance with the City Code. It was also felt that the rezoning would provide more uniformity along the 42nd Avenue corridor rather than the variety of zoning districts that existed (B-3, I-l, I-2, R-O, R-4/5). The All Star Sports proposal to expand on the vacant parcel would be a permitted B-4 zoning use and would compliment the 42nd Avenue Plan objectives. There would be some traffic advantages to a single lot development for access to 42nd Avenue. A south side yard variance would probably be needed and loading zone issues would need to be addressed, however green area could be increased for both parcels and adequate parking could be provided. The Rapid Oil development would require a conditional use permit, as the use is not permitted in the B-4 zone. 42nd Avenue objectives would not necessarily be met with the development, however the aesthetics of the newer oil change buildings can be quite pleasing. It is anticipated that no variances would be needed and a substantial amount of green area could be provided while meeting parking requirements. The issue of the overhead door orientation near residential property would need to be addressed. The development of the lot by Valvoline would effectively cut off All Star's across-the- lot access to Nevada and 42nd Avenue. Site Description The parcel size is estimated to be about 15,000 square feet or .29 acres with about a 120 foot frontage on 4~nd Avenue and an estimated frontage of 125 feet on Nevada Avenue. No current, accurate survey of the property is available. The parcel is legally described as the north 125 feet of Lots 3 and 4, Block 6, Rockford Park. 1988 Appraisal LaSalle & Associates appraised the property in 1988 in conjunction with the 42nd Avenue project. At that time the "land only" value was appraised at $52,500 and the 1988 taxes on the property were $13,390. At the time the appraisal was completed the property was zoned B-3, Auto-Oriented Business. The appraisal stated that "Because of its exposure on 42nd Avenue and its corner location, it is felt that the property would reflect a value toward the upper end of the range of the comparable sales". Tax Information A. 7305 42nd Avenue - Vacant City Parcel Property Identification Number - 17-118-21-24-0061 There is no current Taxable Market Value or general taxes on the property due to the fact that the parcel is owned by the New Hope HRA. Assessments: Street Improvement #387 Street Improvement #431 TOTAL $ 694.94 1,363.68 $2,058.62 Be The County Assessor has indicated that if the parcel were not tax exempt that they would place a taxable market value of $50,000 on the vacant property, as that would be comparable to other parcels surrounding the property. The Frozen Market Value on the parcel, instituted when the 42nd Avenue Tax Increment Finance District was established, is $52,500 with a tax capacity rate of $2,599. 7321 42nd Avenue - All Star Sports Parcel Property Identification Number - 17-118-21-24-0060 1992 Market Value: $ 52,500 Land 157,500 Building $210,000 Total Current Taxes: Non- Homestead Gross Tax State Aid $14,860.01 8,948.00 $ 9,912.01 40.37 Special Assessment-Water Special Assessment-Street Imp.#387 350.01 Special Assessment-Street Imp.#431 1,363.68 Total Taxes $11,665.20 The Frozen Market Value on the parcel, instituted when the 42nd Avenue Tax Increment Financing District was established, is $165,000 ($52,500 land/S112,500 building) with a tax capacity rate of $6,418. 6. TIF Policies and Subsidy In order to determine if a tax increment financing subsidy should be considered to assist the Al-1 Star Sports proposal, the project needs to be compared to the adopted Tax Increment Financing, Redevelopment and Economic Development Policies of the City. Highlights of these policies and priorities, applicable to this project, are outlined below: A. TIF POLICIES 1. Redevelopment Projects. First priority in the use of TIF will be redevelopment projects. The redevelopment of areas containing blighted, sub-standard buildings, lots, or uses; incompatible land uses; hazards to the public health, safety or general welfare of the community's residents. The TIF will provide for public improvements to serve the area and/or to acquire, clear, write-down the land, to help in accomplishing the redevelopment in the area in accord- ance with the adopted City plans. 2. Economic Development Projects. The second priority for the use of TIF: assistance to achieve a balance and sustained growth and development of residential, commercial, service and industrial sectors of the City. The City is particularly interested in programs which provide for population growth as a basis for receiving a fair allocation of shared revenues from the State and Federal Governments. The assistance will serve to help expand the Be Ce tax base, economy, housing opportunities in the City. The developer must demonstrate financial need for TIF assistance. The developer must also demonstrate that the proposed project will accomplish the City's land use objectives as outlined in the Comprehensive Plan and other related documents. 3. ExDanded Tax Base and Employment Opportunities. The City will allow a higher percentage of tax increment assistance for expanding or new business that provide a project with high building costs in relation to land or public improvement costs, and which provide a higher level of full-time job opportunities in relation to the tax increment involved. Preference for TIF projects shall be given to those projects that provide the greatest return in relation to the tax increment involved. The return will be measured by expanded tax base or number of employment opportunities per the amount of tax increment financing. 4. TIF Target Areas. The City will establish target areas where TIF will be utilized to achieve specific land use and economic objectives. The City will give priority to projects that are in area where specific development plans have been formulated by the City. REDEVELOPMENT POLICIES Redevelopment activities have been cited as the first priorities for public financial assistance. The use of vacant land parcels and public assistance can be utilized in the city redevelopment efforts in the following ways: 1. Elimination of Substandard Lots. The consolidation of vacant land parcels can provide for the elimination of substandard non-conforming properties. Through this type for redevelopment effort, larger buildable parcels become available for desired development. 2. Promoting Land Use Change: The development of the vacant land in blighted or substandard areas will facilitate desired land use changes that will benefit redevelopment districts. The use of public assistance to implement this land use change will serve to change the character of certain areas of the City. 3. Site with Development Limitations: The City may chose to utilize public assistance in the development of vacant land characterized by development limitations such as poor soils, severe topography, drainage problems, or utility and street limitations. ECONOMIC DEVELOPMENT POLICIES The tax increment policies make economic development New Hope's second priority after redevelopment for public assistance. The City will be very selective in the evaluation of economic development projects for public assistance. In addition to the TIF policies, the following consideration will also be applied in the implementation of the Vacant Land Study for economic development projects: -5- 1. ADDroDriate Land Use. Land use designations should reflect the recommendations of the Comprehensive Plan, the Vacant Land Study, or the 42nd Avenue Market Study. Any or preferably all of these documents should be used as a guide when considering proposed land uses, and especially proposed land use changes. 2. Meets Current Market Needs. The proposed development should accommodate the needs of the community, at the time of the proposal. An overabundance of any particular land use tends to cause vacancies in commercial and industrial buildings, and empty dwelling units in residential areas. 3. Provide Local Job Opportunities. The creation of new employment opportunities in New Hope will be a major incentive when considering a potential project for public assistance. 4. Provide An ExDanded Tax Base. New economic development in all areas of industrial and commercial areas contributes to the city tax base. A stable or expanding commercial and industrial tax base assists in paying for needed community services and reduces the property tax impact on local housing costs. 5. Quality Buildinq and Site Desiqn. Any project to be considered for public assistance must be of the highest quality building and site design. In this regard, all new development must comply with all of New Hope's development and building regulations. The All Star expansion proposal meets many of the above guidelines. It is a redevelopment project on a substandard lot and the City could write-down the land. The project would be an example of growth, help expand the tax base, and accomplish a land use objective. Consoli- dating vacant land parcels is a high priority when the action eliminates substandard, non-conforming properties. The All Star Sports site has a street development limitation if the adjacent parcel is developed separately. The 42nd Avenue Study recommends commercial/retail uses, not auto-oriented uses. If the All Star proposal is to proceed using TIF monies, the developer needs to financially demonstrate the need for TIF assistance. The creation of new employment opportunities also needs to be addressed. A decision has to be made as to whether a tenant is needed for the expansion or if All Star will occupy the total building. The policies state that a higher percentage of tax increment assistance will be allowed for an expanding business that provides high building costs in relation to land/public improvement costs. The All Star expansion would have about a $150,000 buildin] cost compared to at $50,000 land cost, or a 3 to 1 ratio of buildinF to land. The EDA needs to determine if that is an acceptable ratio. Increment Generation The Director of Finance/Administration and I have calculate~ estimated tax increments that would be generated from both develop- ment proposals on the vacant parcels as follows: -6- Ail Star Sports Estimated Valuation of Expansion (land & building) Less Frozen Land Value First $50,000 taxed at 3% Second $100,000 taxed at 4.7% Municipal Tax Rate Increment Generated Per Year Over and Above Current Frozen Cap $200,000 -50,000 $150,000 $ 50,000 x 3% $ 1,500 $100,000 x 4.7% $ 4,700 $ 1,500 + 4,700 $ 6,200 x 1.21 $ 7,502 Rapid Oil Estimated Value of Development (land & building) Less Frozen Land Value First $50,000 taxed at 3% $200,000 taxes at 4.7% Municipal Tax Rate Increment Generated Per Year Over & Above Current Frozen Cap $300,000 -50,000 $~9S0,000 $ 50,000 x 3% $ 1,500 $200,000 x 4.7% $ 9,400 $ 1,500 + 9,400 $ 10,900 x 1.21 $ 13,189 The Rapid Oil Development appears to generate a greater increment due to the larger valuation of the project. Status of 42nd Avenue Tax Increment District The attached Cash Flow Projection of the 42nd Avenue Tax Increment Financing District No. 8 shows the financial status of the district, including the recent low-interest loan made to Autohaus. This is the same projection used when considering the Autohaus loan and the Director of Finance has indicated that the numbers are still accurate (incidentally, the Autohaus loan is being repaid on or ahead of schedule). The beginning cash balance of the district in 1992 was about $616,000 and with revenues of $360,000 and expenses of $187,000; the 1992 ending cash balance is anticipated to be over $785,000. The projected ending cash balance at the end of the district's life in 2004 is estimated to be over $3,500,000. In preparing projections for the Autohaus low-interest loan, we determined that the ending cash balance of the district increased when the loan was made, as opposed to not making the loan at all. -7- The overall conclusion from these projections is that the district is financially healthy, should the EDA determine to use a portion of the TIF District proceeds to assist either All Star Sports or Valvoline Rapid Oil. The EDA may also want to consider a low-interest loan in addition to or instead of an outright TIF subsidy, because if the loan were made and repaid the financial status of the district would be improved. 9. Assisting Local Businesses There has been some discussion as to whether the Ail Star expansion could assist more than one business. Universal Color Lab has talked with Ail Star about locating a drop-off site within the new building. This would get Color Lab out of the front of Autohaus so all improve- ments on that property could be completed. In effect, this would assist 3 local businesses, not just one. I discussed this scenario with Paul Anderson of Universal on July 23rd and it does not appear to be workable from his perspective at this time. He currently has a lease with Autohaus that does not expire until May 1, 1995. Anderson's first preference is not the Ail Star site because he would have to split his business with the retail portion located at Ail Star and the warehouse portion located at a different site. He also prefers to own a building and does not want to lease. Anderson is still looking at alternate locations where he could keep his entire business under one roof. There is a possibility that if he could not find a building in the future that he would rent a portion of a building on 42nd Avenue for his 1-hour photo operation and buy a warehouse at another location, but that is not his preference and he is not ready to commit to anything at this time. Anderson's rent per month to Autohaus is $3,150. 10. Conclusion There are definite advantages and disadvantages to each proposal. The Ail Star Sports proposal meets the zoning requirements and is compatible with the long-range 42nd Avenue Development Plan. It would also combine two non-conforming properties into one conforming site. Also, Ail Star is a long established local New Hope business. However, Ail Star is only offering $50,000 for the property and is requesting a large amount of public assistance. Preliminary estimates show that the expansion would generate a smaller increment that the Rapid Oil proposal. The need for TIF assistance and the amount need to be documented and the tenant situation should be resolved. The Rapid Oil proposal does not meet 42nd Avenue development objectives, however they are offering $75,000 for the property, are requesting no public assistance, and the project would generate a larger increment for the district. Attachments related to this memo are enclosed for your reference: Maps Ail Star Plans & Cost Estimates Rapid Oil Plan Rapid Oil Purchase Offer/Correspondence 42nd Avenue Rezoning-1990 Tax Increment Policies Frozen & Current Tax Values 42nd Avenue TIF District Cash Flow Appraisal Excerpts 1.4 I-1 I"'1 t ~L m ~ms / Quality Commercial & Industrial Construction for 80 years 5010 HILLSBORO AVENUE NORTH · MINNEAPOLIS, MINNESOTA 55428 612/535.1481 June 11, 1992 Messrs. Jerry & Mark Norman ALL STAR SPORTS 7341 42nd Ay. N. New Hope, MN 55427 Dear Jerry and Mark: As I indicated following Monday night's meeting, this letter will outline the various financial considerations associated with the project indicated on the attached plan. I. Estimated Project Cost A. Remodeling of Existing Building: Remove existing entry and stairs· · New front window. · New stairs· · New entry system. · New fascia metal. · Remodel office area. B. New Construction: · New entry area. · New ramp system. · New accessible bathrooms. · New retail space. · Exterior to match existing. $10,000.00 $115,000.00 Site Work: · Demolition of existing concrete. · O.u'b and gu~ter. · Paving. · Landscaping. $25,000,00 ~Note: Does not include any costs associated with discovery of contaminated soils. TOTAL: $150,000.00 II. Other Costs A. Related Soft Costs: B. Land: · Project Costs: $10,000.00 $50,000·00 $150,000.00 TOTAL: $210,000.00 I PRELIMINARY· SITE' PLAN -4 __1__ "~PID OIL" PROTOTI~g 7305 42nd Ave. ** B-4 Zone (Auto-oriented discouraged) 14,000 sq. ft. lot - 52' x 36' building Driveway shifted No access on 42nd Trash enclosur~e at south side No cu=r~.y~ai~ab~, l) Aesthetic concern/compatibili~y N INITAN? 011, Cltlllll " COLIC, I111, ~I '. VALVOLINE INSTANT OIL CHANGE, INC. This letter shall serve t.o notify that Rapid Oil Change, inc., ......~s intera~.,t~d in vhe purchase of the above captioned ~-,~,,- .... .... ~.=~*,...y, At. an ~stim,~t.~d purchase price of seventy five thoL~.a'an~J dollars ~' - ~' - '~c te and conditions ~--~ forth ~', ,, ~. 7 b, ,., 9 U ). B,~. ..... I o n r m s ~,.. ~,, o u r ......... ~,~ Agreement. Th ~ ' ~. letter shall not bind Va"-~ ., zT~.:zine, Ashland Oil, Inc 5'.apid Oil Change, ~-- ~ in , Any binding zn:_:, any manner what-so-ever a~reement shall be signed by an officer of Rapid Oil Change, ~n:_:. or by any person given its Power of Attorney. M,~ ~ L~ea~ Estate Representative ~ J S / j h A Sul:)s~d~a~y of Asnfand Oil, Inc a l i) n) i n ealt3t 4025 WESTSROAOWAY ROBSINSDALE. MINNESOTA 55422 S33-862c~ January 31, [992 Mr. Kirk McDonald City of :4ew Hope 4401 Xylon Ave. North New Hope, Minnesota Re: City-owned property 7305 42nd Ave. North Dear Mr. McDonald, Please find enclosed a letter of intent from Valvoline Oil Change, Inc. executed by Mark Z. Segal their real estate representative. It is our understanding that the purchase price of Seventy Five Thousand Dollars ($75,000.00) includes a comission of 7% payable to Baldwin Realty Company at the time of closing the sale. If the City of New Hope wishes to enter into a purchase agreemen= with Valvoline please let me know at your earliest convenience. RLB/do / al3Wi n ealty 4025 WEST BROADWAY ROBBINSDALE, MINNESOTA 55422 533-8629 December 18, 1991 Mr. Dan Donahue City Manager City of New Hope New Hope, Minnesota 55428 Re: Valvoline Instant Oil Change Dear Dan, I am enclosing a blank copy of a Contract to Purchase, for your reviewal, from Valvoline Oil they would like to use if they are successful in negotiating a deal with the City of New Hope on the 42nd and Nevada site. Please let me know if the agreement would meet the City's require- ments to use in making a bon-a-fide offer on the subject property. CONTRACTTO PURCHASE AGREEMENT, dated ,19 ..... by and between ............... with a mailing address of Attention: ...... ,., Daytime TelopMone ( ....... ) ............. (whether one or more, "Owner') ~nd Valvoline Inatant Oil Change, Ifc,, a Delaware corporation, a subsidiary of Ashland Oil, Ir,c., wtt~ a malting address el 301 East Main Street, Suite 1200, Lexington, KY 40507, Attention: Real Estate Department ..... Telephone ......... ("Purchaser'). Prior to clo~ing, contact ............ WTTNESSETH: IN CONSIOERATION OF .... , ................. Doffers ($ .... a~:V'~-~'lc)cel affiliates (~ ~ny"}, receilX o~ wnictt ~ ,.~-y -,.,,,,.,-,,~.v.. ........ et I~ussis, PA 19406, agreed to sell and Purchaser has agreed to purchase cc'rain land now owned by Owner and located in/at ......... City: ................ County: ......... State: ......... and more particulariy descrlbeCI on Exhroit A attachecI hereto and m"~ade a part here~)~','i~ther with the buildings, improvements, appurten .ance___~ and fixtures located o~ ~JCfl land ('Property'), on the following terms and conditions: 1. PURCHASE PRICE. The Purchase Price for the Property payable at the clOSing hereunder shall be ............... Dollars ($ .............. ), (a) A recordable deed or deeds ~ covenants of general warranty and ¢ofl~aimng a metes a~ bounds dascriptk~ and al other Inatmment~ arxl documef~ necesas~y to vest Pumhaser ~ mdu'k~al~e, fee simple title to the property, free Of m~e~, liens af~d other encumbrances, arid tree et restrictions, eaeemen~, tenancies, or other bucdens Of:)Jected to by Purchaser, and ful~ insurable with Purchasers title insurance company subject only to the unavoidable excol~oas of such title insure,ce company; and. (b) AMuaJ po~ Of the Prell, flee, clear and discharged Of ~ion by a~y pa~'son, in the same $. REPRE~NTATI~ BY OWIdEI~ ~ represents and warrants to Purchase' nat: ' (ii) Owner is ti(:4 & 'Foreign Person, ~ the meaning Of ~ection 1445 of the Internal Revenue COde Of 1986, as amended, and Owner w91 deliver an affidavit to sucll effect to Purchaser at the clceing hereunder, as required by that SeCtion; and (b) if e c~l:x~'etion, Owner is in g(x~l standing under the laws of the State o~ ~ kxX:Xlxx~n, is duly qualified to do I:)usin~ Jn the Sta~ in wtdch the Properly Is tocated, and has taken all coq:xxate actioa necess,a.~ to enter i~to and (C) Owner haS ma~etabte, fee ~ ttde to the entire Prepay, has the full right to gfent this Agreement and perform hereunder, and has not loc, al agencies, and Owner will delmar (e) TO 1he best Ot Owners knowledge ~ ~ ~ other factoes affecting the sultabitity Of the Pro~:>erty for ~ are such that the ~e i$ suitable tot b~; and (f) Purchaser wll have av.agable and installed at the propmly line Of the Prol~ all water, sanitary sewer, storm sewer, gas, elec~ a~d otlx~ ~ sewicos required for the doveleSxwant of the Property in accorde, n~e w~ plans and speciflCatloas acceptable to Purchaser or Owner will provide such installation at Owner's eXl:Xl~se; and (g) The Prof:)erty iS not subje~ to any ea~e,"nent, covenant of restflotton white le rt~ Of [~.;G,-d in the chain of tit/e te the Property; and The provisions of this Seotk~ 3 ahell survive the closing hereunder. 4. CONINTIONS TO PURCHA~..R'S O~4.1GATtONS. (a) Purchaser, at its sole dlscretiOfl, may cancel this Ag~eemenl, and ~ be endtled to the reexn Of ~ sum ~ as c~atton fo~ thi~ Agreement ii, pnor to closing hereunder, (i) Purchaser obtains at Owr~r'a expense sut~eot to any lien, encumbrance or other defect or other exception excefX the standard, unavoidable exce~ions of the title insurance company ~ abetraoter; or (ii) Purchaser obtains at ~a expense an accurate survey of the Property parforrned in accordanCe with ALTNACSM standarde showing that the Property is not as de~ on Exhit)lt A, or is not free el any encroachment or otlle[ defect; or ~ ~ v~, ~, ~ ~ ~ ~ ~ ~ ~za~, ~ Pu~r ~ ~ ~ ~e ~ ~ ~ u~ ~ t~ P~, ~ wll~l I~t~ f~l ~i~di~ permits (iv) P~c~e ~ at PurSer's ex.rise ~ ~ ~ndwa~ an~y~s, p~c~a~n tests, (v) P~ ~ ~ ~ ~ ~ ~~ to ~ ~ ~ wat~, ~ ~, s~m ~w~ 0~ ~ai~, gas, ~y ~ ~ ut~ty ~s r~ir~ by Pur~ ~ ~ ~vet~me~ of ~ Pr~ty: ~0~ ~ ~ ~ ~ r~u~ ~ ex~ ~ to ~ ~ ~, p~ ~y ~ ~ ~ Pr~y (~) ~ ~s ~ r~e~ ~ ~ ~t ~y ~ ~ ~ eve~ ~atl~ ~eu~r: ~o~ (vii) P~r is ~ to ~aln ~~ a~ a~ov~ of t~ Pr~ In Purc~asgr's Masler Lease (B) F~ ~ ~ t~ ~n 4, ~ in~ u~ of ~ Pr~ ~ a ~ ~ ~, ~t~n, a~ ~~ se~ ~, ~ ~~ ~ ~ ~ ~~ ~ to P~. ~r~ sh~ ~vo a~a~, ~ P~ ~ ~ or ~ ~ ~ ~ ~ ~ ~ Pr~y; ~, ~wev~, return ~ s~ of ~ Pr~ ~ ~n~,y ~ ~mg ~OiB~ ~ ~f~ ~ ~t~. ~dln~ wear a~ tear ex~t~. P~ ~ ~re~ a~riz~ to re~ the ~u~s of ~y u~s~r~ ~nk a~ pi~ ~ testing, ~ ~ ~at~ ~l~ ~ analysis, ~o Federal, State or I~1 autho~O~. ~ner ~all ~rnish all ren~n~le Pr~. 5. TAXE~AS~N~~. ~men~ sm~ ~ tr~sf~ t~es s~ ~ ~ by ~ner. ~ r~ the n~t r~ nyse ~. ~ ~ ~ts ~ ~~ ~ ~e Pr~ (w~ ~ ~ ~, ~ ~ ~ ~ ~r ~ ~ ~e ~ ~m ~ ~. ~ ~ ~ ~ t~ P~ ~ to the c~ 6. ~ ~ L~~. (a) R~ N ~ ~ ~ Pr~ ~ ~v~ ~e, ~ wear ~ ~e~ (~) ~ ~ ~ ~ ~ ~ ~, ~ ~, ~~ ~ re~ ~i~, ~r~ a~ ~ ~ ~, ~, ~a~, ~, ~, ex~ ~ I1~, I~ r~e atto~y leos and ~ ~ ~ it~ ~rr~ ~ ~ i~mNF~ ~, ~ ~ ~ ~ju~ ~ ~a~ at any r~ ~, ~ ~ ~ ~ ~ u~ a~ ~ ~ ~mfr~, ~ of a~e law, ~ ~~ ~~, r~ ~ ~ ~ ~ ~ ~rr~ ~ ~ ~ ~ Pr~ ~ ~n or uso of ~ Pr~y ~ ~ ~ ~ ~. T~ ~ ~ ~ ~ ~) ~ ~ve ~ ~ ~er. 7. ~KE~ FE~. ~ ~ ~ ~ ~u~ ~ ~ ~ ~ ~ ~ ~ a~ ~ Its ~t ~ r~ to ~ ~~ ~~ ~, ~y ~s' ~ ~' ~ ~ ~~ ~ ~ ~ ~le~ ~y ~ Pum~ ~ ~ r~ 9. ~FA~T. M ~ ~ ~ ~ ~r, ~ ~s) ~ ~ ~~ for ~ Agr~ 11. GENERAL PROVISIONS. (a) This Agreement st'tall bo coflstn.~d, governed and administered in accordance wi{h the laws ot tho State in wllictt the Property is Iocatod. (1=) Tl'~a ~g~err',en~ ~s me final ar~ emote expre~s~o,~ ~ u~ ~ ~n ~u~cn~ ~r~ ~r ~ ~ r~O ~, ~s, ~ r~t~, ~ ~. ~r~ ~y ~ ~ ~nt to a (~) 1 ~ ~~ ~ ~ ~ ~ ~ Pur~ un~ ex~ ~ P~s d~ au~iz~ o~fic~ or ~y-~-f~. (o) T~ ~ ~ ~ ~eN Is ~t ~ut~iz~ to ex~e t~ A~nt or to enter in;o any ~e ~ ~ ~m ~ o~ ~ ~ ~t ~ ~f of V~m ~t~ ~ C~e, ~. O~ER ~S ~ T~ A~EEMENT ~0 UNOE~TANDS T~T THG AG~E~ IS NOT AND ~ES NOT BEC~E A ~LE ANO ~RC~ AG~E~NT ~TIL ~Y EXECUTED BY P~CHASEB, ANO TO VALle, ~R~SER'S EXECUT~ ~ THIS AGREEMENT MUST ~ BY PURCHASER'S OULY AUTHORIZED OFFICE~ ~ ATT~Y-IN-FACT. ~N WI~ ~~, ~ ~ ex~ ~is ~ ~ ............................ day WITNESSES TO OWNER(S): SIGNATUP~: .......... PRINT NAME: ............. TTTLE: ........ _. $1C.d~IATURE: PRINT NAME: .............................. TITLE: ................................ VALVOLINE INST.N~IT OIL CHANGE. INC. By: ............... Title: .' - WITNESSES ~S TO PURCHASF~: CITY OF NEW HOPE PL~d~NING CASE REPORT Planning Case: 90-30 Request: Request to Consider Ordinance Amending New Hope Zoning Code to Rezone the Majority of B-3 Auto- Oriented Zoning District Properties on 42nd Avenue North between Louisiana and Winnetka Avenues to B-4 Community Business District Location: 7100-07-17-40-41-80-81, 7202-31, 7305-12-21, 7400- 01-12, 7600-01-75, 7700-01, 7820-49-58 42nd/4125 Oregon/4124 Quebec/4211 Rhode Island/4148, 4200-10 Winnetka PID No.: 17-118-21 21 0032, 17-118-21 24 0003, 17-118-21 24 0002, 17-118-21 21 0035, 17-118-21 24 0007, 17-18-21 .21 0031, 17-118-21 24 0108, 17-118-21 21 0002, 17- 118-21 24 0004, 17-118-21 24 0061, 17-1118-21 21 0003, 17-118-21 24 0060, 17-118-21 21 0007, 17-118- 21 24 0090, 17-118-21 21 0008, 17-118-21 22 0005, 17-118-21 23 0007, 17-118-21 23 0004, 17-118-21 22 0034, 17-118-21 23 0005, 17-118-21 22 0015, 17-118- 21 23 0001, 17-118-21 22 0011, 17-118-21 24 0091, 17-118-23 0008, 17-118-21 22 0053, 17-118-21 23 0002, 17-118-21 22 0013, 17-118-21 22 0012 Zoning: B-3 (Auto-Oriented) Petitioner: City of_ New Hope Report Date: September 28, 1990 Meeting Date: October 2, 1990 The petitioner is the City of New Hope. The request is to an ordinance amending the New Hope Zoning Code to rezone majority of B-3 Auto-Oriented Zoning District properties on Avenue between Louisiana and Winnetka Avenues to B-4 Commur.- Business Zoning District. The request is pursuant to Sections 4.202, 4.23, 4.29, 4.32, 4.33, and 4.35 of the New Hope Code Ordinances. Property owners within 350' of the request have been Besides the usual legal notice, all property owners with propert.~s included in the area to be rezoned were sent the attached from the City along with a copy of the report prepared by Consultants. Staff has attached the legal notice to this report so that Commission is aware of the exact addresses of the property ~: rezoned. Planning Case Report 90-30 October 2, 1990 Page -2- Staff has received one written response from a property ~wner who supports rezoning - David Lasky, owner of the Paro's Pub building. The report prepared by the Planner analyzes the issues surrounding the rezoning. It is the feeling of the staff that the nature of the area has changed over the past several years from an auto-oriented type zoning district to a commercial/retail type zoning district. Several gas stations have been demolished in the past several years in conjunction with the 42nd Avenue Redevelopment Project. The · potential for c~ality redevelopment in the area would increase if the types of uses permitted were shifted away from the B-3 Auto- Oriented use to a commercial/retail use. The Planner feels that the rezoning of the properties on 42nd Avenue to a B-4 Zoning District would be a logical extension of the commercial zoning at the City Center Shopping Center· The rezoning would also bring several non-conforming properties, such as All-Star Sports which is currently zoned B-3, into conformance with the code. All conditional uses allowed in the B-3 District are either permitted or allowed by conditional use in the B-4 District. Besides the Paro's Pub property, over the last several months the staff has received inquiries about new retail uses or expansion of existing uses on the following properties: -All-Star Sports - expansion on City-owned parcel -Metrophone Building - new use -City-owned property east of railroad tracks - new use None of the proposed uses (retail) are currently permitted under the present zoning. By insisting on a B-3 Auto-Oriented use for the properties on 42nd Avenue, redevelopment and expansion opportunities are being hindered. The rezoning would also provide more uniformity along the 42n: Avenue corridor rather than the existing variety of zoning distric~ (B-3, I-1, I-2, R-O, R-4/5) 0 Each of the properties will be examined individually at the hearing to determine the impact the rezoning would have on each parcel. RECOMMENDATION Staff supports the rezoning of the properties along 42nd Avenue between Winnetka and Louisiana Avenues from a B-3 to a B-4 Zoning District because the nature of the area has changed and the rezoning will enhance economic redevelopment. U R B pL. N N G . O N . M A R K E R E $ E A ~ ~ ~ PLANNING REPORT TO: FROM: DATE: RE: FILE NO: Kirk McDonald Robert Kirmis/Alan Brixius 29 August 1990 New Hope - 42nd Avenue Rezoning 131.00 - 90.03 EXECUTIVE SUMMARY Backgrounds The City has identified several properties along the 42nd Avenue corridor between Winnetka and Louisiana Avenues which hold zonin~ designations which are not reflective of their use. ~n a:: attempt to unify existing and future land uses in the area an~ establish a cohesive commercial district within the City, %:'..~ City is investigating the possibility of rezoning certain properties from B-3, Auto Oriented'Business to B-4, Community Business. This report., shall review existing conditions in %he area, cite area use and zoning incompatibilities and make recommendation on suggested rezoning appropriateness. Attached for reference~ Exhibit A - Study Area Exhibit B - Existing Zoning and Land Use Exhibit C - Proposed Land Use Exhibit D - Existing Property Occupancy Exhibit E - Proposed Zoning Changes Recommend&tiont Based on the following review, our office finds that properties within the 42nd Avenue study area hold zen_' designations which do not reflect their use. Because the area question has changed in character from an auto-oriented serTM area to a community wide commercial center, and a rezoning wc follow City policy in rezoning areas which have changed character, it is recommended that noted properties in this repc 4601 Excelsior Blvd..Suite 410.Minnea13oliS, MN 55416.(612) 925-9420.Fax 925-272~ and illustrated in Exhibit E be rezoned from their existing base zoning to 8-4, Community Business District. Such an action would allow area zoning designations to reflect area uses and allow %he City considerably greater flexibility in future area redevelopment efforts. In addition, an amendment to the will be required to allow the consistent with the said document. 42nd Avenue Improvement Study proposed rezonings to lie ISSUES AND ANALYSIS 42nd Avenue Improvement Study.. In 1985, the City adopted the 42nd Avenue Improvement Study as a guide for land use development along the 42nd Avenue corridor between Winnetka and Louisiana Avenues. The plan established a number of goals aimed toward the improvement of the area which lie applicable to the propcsed rezoning. According to the said plan, an adopted City goal is to unify area development and present a positive commercial image for the City of New Hope. The proposed rezoning would unify the area by eliminating several use non-conformities. The plan also stipulates that area development should be relate~ to needs and desired development priorities of the City. In conjunction with the New Hope City Center, it is the intention of the City to establish the 42nd Avenue corridor under study as one of the City's prominent commercial areas. As such, proposed rezoning would Provide a vehicle by which this object,ye may be more readily attained, With the exception of those properties which flank 42nd Avenue between Nevada Avenue and the Soo Line Railroad, the proposec Land Use Plan contained within the 42nd Avenue Improvement StuZv is consistent with the proposed rezoning (see Exhibit C>. According to the 42nd Avenue Plan, the said properties had been designated for future residential use. In an attempt to realize this initial land use proposal, the City attempted to locate ~ handicapped housing complex in the area. Due to s~%.~ complications, however, the project was moved to the City Cen%e- area. Aside from the said public handicapped housing complex, - other residential projects have presented themselves to the area Due to the commercial amenities offered by 42nd Avenue (acces~ visibility, etc.), however, commercial businesses may choose locate in this area~ With the City's approval of the 36th winnetka commercial rezoning, the City presented a position allow the market to dictate commercial locations. To prov~ greater development flexibility in the area, a commerc' ~ rezoning should be strongly considered. Generally, existing proposed commercial uses are considered acceptable in that %~-~' -are highly compatible to adjacent uses. Noting the discrepan between the 42nd Avenue Land Use Plan and the proposed rezont~7, an amendment to the 42nd Avenue Improvement Study shoulc Se pursued. Existing Conditio~s~ Contrary to 42nd Avenue and Comprehens£¥e Plan objectives, the existing mixture of zoning in the area serves to limit redevelopment efforts and presents a barrier ~n the City's attempt to establish a high quality commercial area. As shown on the existing Land Use ~ap (Exhibit B), properties which flank that segment of the 42nd Avenue corridor under study contain a wide variety of uses and zoning designations. The majority of land within the corridor is commercially used and holds B-3 zoning designations. The study corridor does, however, contain both I-l, Limited Industrial and I-2, Generat Industrially zoned land. I-1 zoned property lies southeast cf the Winnetka/42nd Avenue intersection and contains School District offices and a Country Kitchen Restaurant. Property zoned I-2 lies north and south of 42nd Avenue between Quebec Avenue and the Soo Line Railroad. The district includes bc%h industrial (north of 42nd Avenue) and office related uses (south of 42nd Avenue). The corridor also contains residentially zoned property. The central one-third of the vacant parcel lying north of 42nd Avenue and east of the Soo Line Railroad holds an R-4, High Dens£t'z Residential zoning designation. Finally, the corridor also contains two relatively small parcels of land zoned R-i, Residential-Office. One of the said properties holds a "Dental Lab" facility, while the other currently lies vacant. Zoning Appropriateness. As noted previously, the City has raise~ questions regarding the appropriateness of certain zoni2i designations within the 42nd avenue corridor. In determining %he suitability of the existing zoning, an examination of the £nten~3 of the area"-s existing zoning designations and B-4 Districts -~ warranted. The following are excerpts from the City Zoning Ordinance regard to stated purpose for each district: R-4, High Density Residen~ial Distric~ 4.081 Purpose. The purpose of the R-4, High Dens. Residential District is to provide for high dens. residential uses, and directly related uses. ~-0~ 4.091 Residen=i&l-Office District Purposet The purpose of the R-O, Residential-Office District is to provide for high density residential use and for the transition in land use from mid density residential to low intensity business allowing for the intermixing of such uses. B-3, Auto-Oriented Business District 4.121 Purpose~ The purpose of the B-3, Business District ~s to provide for establishment of motor vehicle oriented commercial and service activities. Auto-Oriented and limit the or dependen~ B-4, Community Business District 4.131 Purpose. The purpose of the B-4, Community Business District is to provide for the establishment cf commercial and service activities which draw and serve customers from.the entire community or subregion. I-l, Limited Industrial District 4.141 ~se · ~ The purpose of the I-l, Limited Industrial District is to provide for the establishment of industrial development in a well planned, residentiaLt'; compatible setting. I-2, General Industrial District 4.151 Purpose. The purpose of the I-2, General Industrial District is to provide for the establishment of hea'.'v industrial and manufacturing development and use whtzn because of the nature of the product or character activity, requires isolation from residential or non- compatible commercial uses. The I-2 District ts als~ intended to provide for large scale activities c~ sociological nature not suited to other districts reasonably compatible with the same characteris%- suitable for general industrial use. If the City is attempting to achieve a cohesive zoning pan- that facilitates commercial redevelopment along 42nd Avenue, residential and industrial zoning district are inappropr'~ Because the majority of commercial uses which lie wither. study area are not totally motor vehicle oriented and puc services which draw from the entire community, a more intense zoning designation should be considered more reflective variety of existing uses. A B-4 zoning designation would expand the commercial redevelopment opportunities over the more limited 8-3 District. A change from B-3 to B-4 would, however, maintain the same performance standards with regard to lot size, lot width, setbacks, and building height. In evaluating any rezoning proposals, the City must also consider the following established policies regarding such actions: 1. Has the character of the area changed to warrant consideration of a zoning change? Has the rezoning request resulted from a past zonin~ mistake? Generally, it would appear that the area in question has changed in character from an auto-oriented service area to a community- wide commercial center. As such, a rezoning to a B-4 woul~ appear appropriate by more closely reflecting existing area uses and allowing the City more flexibility in area redevelopmen% efforts. Propert~ Inventory. In order to make specific and concise determinations of appropriate zoning, the study area must be examined on a more detailed and intimate scale. The following a listing of existing area properties, their existing designation and the conformance to their particular zcn~n~ district. The following table should be used in reference Exhibit D which illustrates specific parcel occupants. 5 42ND AVENUE REZONING Site 1 4 5 8 9 10 11 13 14 15 *Prgperties to Occupant/Address Hardee's 4210 Winnetka Unocal 4200 Winnetka Port Arthur 7858 42nd Avenue Phillips 66 7820 42nd Avenue Vacant Building 4211 Rhode Island Kupenheimer 7700 42nd Avenue Sunshine Factory 7600 42nd Avenue Foremost* 7528 42nd Avenue Vacant Building* 7516 42nd Avenue Ardel Eng. & Manf.* 7500 42nd Avenue Ind. School District 4148 Winnetka Country Kitchen 7849 42nd Avenue Autohaus 7701 42nd Avenue Vacant BuildiKg 7675 42nd Avenue Y.M.C.A. 7601 42nd Avenue retain existing Existing Zoning B-3 B-3 B-3 B-3 B-3 B-3 B-3 I-2 I-2 I-2 I-1 I-1 B-3 R-0 I-2 zoning 6 STUDY Existing District Conformancy Yes (Conditional) Yes (Conditional) Yes (Permitted) Yes (Conditional) No Yes (Permitted) Yes (Permitted) Yes (Permitted) Yes (Permitted) Yes (Conditional) Yes (Permitted) Yes (Conditional) Conformanc/ with Prcpcse~ B-4 Zonlnq Yes (Conditional Yes (Conditional Yes (Permitted~ Yes (Conditicna!] Yes (Permitted Yes (Permitted N.A. N.A. Yes ( Permit-~e i (Permit%~ Yes (Condi%- .. Yes (Condit~_ 16 Occupant/Addres~ Office Building 4124 Quebec 17 Office Building 7401 42nd Avenue Existing Zoning I-2 B-3 18 First Line Engine B-3 · 4125 Oregon Avenue 19 All-Star Sports B-3 7321 42nd Avenue 20 Vacant Land B-3 7305 42nd Avenue 21 Total Gas B-3 7231 42nd Avenue 22 Cafe B-3 7181 42nd Avenue 23 Tom Thumb B-3 7141 42nd Avenue 24 Broadway Pizza B-3 7117 42nd Avenue 25 New Hope Bowl B-3 7107 42nd Avenue 26 Cook Auto B-3 7100 42nd Avenue 27 Dental Lab* R-0 4215 Louisiana Avenue 28 Crown Auto B-3 7140 42nd Avenue 29 Vacant Building B-3 7180 42nd Avenue 30 Vacant Lot 7301 42nd Avenue R-4/B-3 Existing District Conformancy Yes (Permitted) No No No Yes (Conditional) Yes (Permitted) No Yes (Permitted) Yes (Permitted) Yes (Conditional) Yes (Conditional) Yes (Conditional) Conformancy with PrcTcsez B-4 Zonin~ Yes (Permitted Yes (Permitted No Yes (Permitted Yes (Condit Lcr, a l Yes ( Permitted Yes ( Permitte~ ' Yes Yes (Permitteu Yes (Condi%i~n2_ N.A. Yes (CondLt~ *PrQperties to retain existing zoning 7 Auto-Oriented Uses. As shown in the previous table, the study area does hold a number of auto-oriented uses which are appropriate to their existing B-3 zoning designation. These uses include Unocal, Phillips 66, Autohaus, Total Gas, Cook Auto, and Crown Auto facilities. While the uses do reflect their zcnin~ designation, they also represent a minority in regard to area use type. Because these B-3 uses are allowed as conditional uses within B-4 Districts, and would present no dhange in terms of development rights, a rezoning to 8-4 is recommended. Such a zoning designation shall unify the commercial area and prov£de the City with greater flexibility in regard to redevelopment efforts. Industrial U~-.s. As noted previously, the subject area holds industrial 3es which exhibit I-2 zoning designations. Specifically, these include the Foremost Metal Specialties the Ardel Engineering and Manufacturing facility. Because the two uses represent established uses within the corridor and are neither permitted or conditional uses within the B-4 District, is suggested that their I-2 zoning designation remain unfit redevelopment opportunities arise. At such time, a rezoning B-4 should, however, be strongly considered. The study area also contains an area of I-l, Limited Industr£al and I-2 General Industrial zoned land (south of 42nd Avenue east Winnetka Avenue). while the uses along the south side 42nd Avenue are allowed in the industrial zoning district, the'; are commercial in nature. Rezoning of the properties commercial designation will be consistent with the exis'lnu development and would eliminate the potential for indus~r~al redevelopment along this portion of 42nd Avenue. A rezoning these properties to a B-4 zoning designation is suggested. Residentl&l/Residential-Office Uses. As noted previously, portion of-the subject area holds a R-4, High Density Residen~a. zoning designation. Because the R-4 property currently .~e~ vacant, provides a disruption in a contiguous'zoning pattern, an: because market conditions have not evidenced a need for such use in the area, it is recommended the vacant R-4 parcel rezoned to B-4. The study area also contains two parcels of land which hold Residential-Office zoning designations. One of the said parce. which lies adjacent to the Autohaus facility, currently vacant and exists ~ssentially as a "spot" zoning district. said parcel which had held the New Hope Veterinary Clinlr currently being incorporated into the expansion plans of adjacent Autohaus facility. Due to the parcel's inconsistency contextual zoning, a rezoning of the parcel to B-4 recommended. - 8 A second R-O Zoning District lies northwest of the intersection of 42nd and Louisiana Avenues. The parcel currently contains a "dental lab" facility and due to its adjacency to a single famil'; neighborhood, should retain its R-O zoning designation. This is not to say, however, that when redevelopment proposals do arise, a rezoning of the propert~ to B-4, Community Business should nos be considered if the site ~s incorporated into a larger project abutting 42nd Avenue. Non-Conformities. The subject area does contain a single property which currently exists as a legal, non-conforming use within its B-3 zoning and would remain so under a ~-4 designation. The First Line Engine Rebuilders facility, located southwest of the intersection of 42nd and Oregon Avenues, is act considered either a permitted or conditional use within either B-3 or B-4 Zoning Districts. Because a rezoning of the non- conforming property would not result in the change of any development rights to the property and would unify area zoning designations, a rezoning to B-4 is recommended. CONCLUSION Based on the preceding review, our office finds that properties within the 42nd Avenue study area hold designations which do not reflect their use. Because the area tn question has changed in character from an auto-oriented serYtze area to a community wide commercial center, and a rezoning wcu'l follow City policy in rezoning areas which have changec character, it is recommended that noted properties in this repc-- and illustrated in Exhibit E be rezoned from their existing Sase zoning to B-4, Community Business District. Such an action .~ allow area zoning designations to reflect area uses and al'" City considerably greater flexibility in future area redevelopment efforts. In addition, an amendment to the will be required to allow the consistent with the said document. 42nd Avenue Improvement proposed rezonings to cc: Doug Sandstad EXHIBIT A - STUDY ARE p,:..;...'.2..V.'.',..:. :,',/< ,,,' ,,'.. I~'S~,"~_' :_.'¥~ rI .... !.. ~ ~Li- ~ . -... ,. T.: · ,~-,, m, , ~.{ .... f,. ~t.-F ... ...... ;1,{.,. ,.,..., ,,i · , . ,....,,lttl . .... , ,,,+ s t-~-+ .... I t.t . · ::;; ;.. ::;..~".Lt'.:t i'~,' r..t :.~.~. '~ ~{ , t ,"/~,.' · ,r.. -I: · ,,,.+, J . t r zoning R-1 R-O [-l. I-;:' Single Family Residential Medium Density Residential Jligh Density Residential Res identi al -0 ffi ce Auto-Oriented Dusiness DisLrict Limited Industrial General Industrial- 4~11'I Ivefluo north i~REO S~MS PARK land ,2.1.:.1-1..'-2.:.2.2.2.32 :-'.'.:.1.'.2'> · ':'" ' '.' '~. .,,' .: '.:.',.q. ..~ ........ ,,~,., .,..... .,, ~t-. ,.....~;........, ~ v... co.m~ercial, off~ce single family residen~ia' mid-high density reside;: industrial 4'2nd avenue improvement study EXISTING ZONING & LAND USE J,,. OI ~',UII, new hope, minnesota A 0 100' 200' 400' EXHIBIT B - EXISTING ZONING & LAND USE legend ~ sing]e family/ resident, ia1 42nd avenue improvement study PROPOSED LAND USE new hope, minnesota ~ ~nor th 0 100' 200' 400' EXHIBIT C 'PROPOSED LAND USE EXHIBIT OI - EXISTING PROPERTY OCCUPANCY ;;: ::::::::::::::::::::: ~:: ~1I :;:::: :!:~:~:::::; ::: ::: :::: ::?? ~! :::::::: ~:::: ~::; ::::::::::::::::::::::::::: ' ::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::: :::::::::::::::::::::::::::::::::::::::::: EXHIBIT E - PROPOSED ZONING C,~ A ~IGES TAX INCREMENT POLICIES POLICY Tax Increment Financing (TIF) plans that are a result of a development proposal will be prepared by city staff and must be presented in detail to allow the city officials to determine whether they comply with the Minnesota Statutes, the city's Comprehensive Plan, development regulations and TIF policies. Explanation: This policy requires that any TIF proposal be presented by the developer in sufficient detail to allow the City Council to evaluate its feasi- bility and its consistency with State statutes and local policies. POLICY II First priority in the use of TIF: the redevelopment of areas containing blighted, sub-standard buildings, lots, or uses; incompatible land uses; hazards to the public health, safety or general welfare of the community's residents. The TIF will provide for public improvements to serve the area and/or to 'acquire, clear, write-down the land, to help in accomplishing the redevelopment in the area in accordance with the adopted city plans. Explanation: PolicY II establishes the first priority guide- lines.as being redevelopment of areas showing signs of blight and deterioration or land use problems. TIF provides a local financing instrument to help cities correct local problem areas. The correction of existing pro- blem areas will take priority over the promotion of new development. POLICY III A second priority for the use of TIF: assistance balance and sustained growth and development of commercial, service and industrial sectors of the city. to achieve a residentiaL, The assistance will serve to help expand the tax base, economy, housing opportunities in the city. The developer must demonstrate financial need for TIF assistance. The developer must demonstrate that the proposed project will accomplish the city's land use objectives as outlined in the Comprehensive Plan and related documents. Explanation: - 2 - Policy III establishes the promotion of economic development as the second priority for the use of tax increment financing. This policy encourages the growth of all land use sectors of the city, provided that the end project serves to accomplish local land use objectives and improves the local tax base and economy. POLICY IV The ~%ty will allow a higher percentage of tax increment assistance for expanding or new business that provide a project with high building costs in relation to land or public improvement costs, and which provide a higher level of fulltime job opportunities in relation to the tax increment involved. Explanation: Policy IV indicates that preference for TIF projects shall be given to those projects that provide the greatest return in relation to the tax increment involved. The return will be measured by expanded tax base or number of emplOyment opportunities per the amount of tax increment financing. POLICY V The city will give preference to residential TIF projects where it is demonstrated that thenatural conditions of the site restrict the development of the site,or the residential project .will correct land use problems or revitalize severely ~under-utilized sites. Explanation: This policy states that the use of tax increment financing development for residen- tial development should be limited to re- development efforts or to areas where the site's natural conditions present physical limitations that restrict development. Site correction efforts represent areas where TIF should be considered in a resi- dential project. POLICY VI ~he city will establish target areas where TIF will be utilized to achieve specific land use and economic objectives. Explanation: - 3 - This policy states that the city will give priority to projects that are in areas where specific development plans have been formulated by the city. POLICY VII The developer will pay an upfront fee established by the City Council (suggest $5,000) as a demonstration of good faith in a project and to cover the city's initial lead in costs, including, but not limited to: inventory, feasibility studies, and TIF plans .... Included is the cost for financial analysis of the development proposal. The city may refund the fee upon signing of the development contract, when these costs can be recouped through the tax increment financing project. Explanation: This policy allows the city to have funds avail- able during the early stages to finance plan review, feasibility reports and TIF plan prepar- ation. Without any type of developer fee, the city undertakes this work fully at their ex- pense, with no assurance that the project will proceed. The policy, therefore, allows this risky expenditure of city's resources. ~POLICY VIII The developers shall present adequate financial information to show the capability, intent, .and history of the developer or company to make all property tax payments required by law in the development agreement. At a very minimum, the developer must adequately explain all sources of revenue such as mortgage, lendors and equity ~nvestors. A pro forma statement showing ten year cash flow forecasts must be submitted to the city. This forecast, at a minimum, must include all revenues, all expenses, all debt service, pretax and after tax cash flows. Analysis of the pro forma must be able to determine operating ratios, break-even ratios, and debt service coverage ratios. In addition to the pro forma, sufficient financial and engineering data must be submitted in order to determine need,as outlined in Policy V. The city reserves the right to employ such consultants as it deems necessary in order to determine the financial feasibility of the project, and/or engineering data as submitted. Explanation: It is vital in the TIF process that the city know if the developer is capable of complet- ing the proposed project and if the project is economically feasible. If the project cannot work, it should be identified in the early stages to avoid any further investment by the Explanation: - 4 - city or developer. The burden of proof for the project's viability is left to the de- veloper to furnish any necessary information required from the project evaluation by the city. POLICY IX The developers will be required to enter into a contractual agreement with the city guaranteeing construction of a certain value, sufficient to provide the tax increment necessary to r~tire..the bond payments used to finance the TIF project. The City will require financial security to guarantee the payment of all property taxes and assessments associated with the project to assure that the city will have the tax increment necessary to retire its bond payments. It is a further policy of the city that the maximum increment will be sought in order to keep the total project life to an absolute minimum. Explanation: A development contract shall be required between the developer and the city to ensure that the proposed project will be completed. Included in the development agreement will be a financial security guaranteeing that the completed project will produce suffi- cient tax increment to pay all assessments and bond retirement payments. POLICY X The development contract will include a partial or full .recoupment of any subsidy for the write-down · of land to the ~eveloper if the property is sold during the period of the tax increment at a profit. Explanation: Tax increment financing is not intended to assist the developer in real estate specula- tion. The city is pursuing developers and businesses intent on staying in New Hope. This policy requires any developer who sells at a profit the property involved in a TIF project, during the term of the project, to recoup any subsidy he receives for property write-down. PdLICY XI Ail city costs for legal, planning, engineering, administration, and financial consultants necessary to adequately review plans, prepare reports, and recommend to the City Council, will be the responsibility of the developer for the projects involving the write-down for the sale of the land. - 5 - The city may assume anyor all costs in preparing the initial economic development plans or redevelopment plans for the city as a planning and marketing tool of the city toward addressing the goals established by the city council for economic development. Explanation: This policy requires the developer to pay for all costs incurred by the city through con- sultant review of the proposed development. ~OLICY XII The, city reserves the right developer's bond counsel. discretion of the developer. to designate the petitioner or Underwriters may be chosen at the Explanation: It is very important that the city have the ability to work in unison with somebody in the developer's group who understands the workings, the policies, and needs of the city. If the same bond counsel is used time after time, then the two sides don't have to "re-invent the wheel" every time a new project comes up. POLICY XIII The assessed value of all parcels of property in all tax increment districts in the City of New Hope shall not exceed 15% of the assessed value of. all private property in the city, as established by the HennePin County Assessor. Explanation: Because TIF is a relatively new experience for the City of New Hope, there should be a limit to the amount of tax increment financing used. While TIF bonds do not cur- rently effect bond rating or net debt limitations of a municipality, the bonds are guaranteed with the taxing power of the city. As the prevalence of the TIF issues increase, it is not unlikely that the amount of TIF bonds will have an impact on the city's credit rating in the future. The 15% of the city's total assessed value establishes a TIF ceiling which should provide some flexi- bility in light of New Hope's being a fully developed city. POLICY XIV The City Council reserves the right to determine whether the need for tax increment financing is consistent with the policies - 6 - of the city and to reject any project it deems is not best interest of the city. in Explanation: TIF is a financing instrument intended to aid the city in achieving its planning and developoment objectives. If a pro- ject is contrary to these objectives, the City Council can and should reject the TIF project. the REPORT NO. PZ453401 ,~.. RUN DATE 02/27/92 ~q~q.~ HENNEPZN COUNTY PROPERTY /NFORHAT/ON SYSTEfl 1992 TAX BOOK · # S R sUNDI~U/ST "ROCKFORD PARK" 006 62~15 $~75 17-118-21 2~ 0060 ' JERRY B NORNAN ~ /- O00.O0 281 0 02 7321 ~2ND AVE N ~36 47 I/2 AVE N '%,"' STATUS: CURRENT CONSTRUCT/ON YEAR 1975 HPLSflN N 125 FT OF. LOTS I AND 2 40 ROAD TAXABLE ILARKET 210~000 GROSS TAX CAPAC/TY 8'325 ~UAL/FY/NG AHT .OO D/V/S/ON NO NET TAX CAPAC/TY 8,3~,,6 FD SHARED TC 2,751 D/V/S/UN DATE RENTAL TAX FD AREA RATE 116.1270 SEE ZD S ZF PROJ AHT 2~087.61 ZF PROJECT NO. 1606 .1 TAX LEVY/DESCR/PT/ON HI'tSTDPRTYP RATE AHOUNT LAND BLDG HACH 0~ BASEl' BASE2 NHBASE NON-HHST NON-HOflESTEAD GROSS TX N CC 120.4970 1~jB60.01 52j500 157j500 3,1b0 STATE PA/D A/D ~9.~60 06555 #ATER /flPROVEflENT 76-1 ~0.$7 * 09856 ST /tip B 387 $50.01 ' 11~61 STREET /flPROVENENT R~$1 1~$63.68 TOTAL TAX 11~665.20 ANT UNPA/D 11~665.20 TOTAL PA/D .00 ~.. NORT CODE/LOAN B ADD/T/ON NAflE LOT BLK PLAT PARCEL PROPERTY /.D. O#NER ESCRO# NAHE/ADDRESS ACREAGE SCH #TR SEN PROPERTY ADDRESS SN TNP RG Q~ SUFX TAXPAYER NAHE/ADDRESS HETES AND BOUNDS / ' DST SHD DST NEff HOPE H R A t / 89~ ffROCKFORD PARKff 006 62~15 3560 17-118-21 2~ 0061 NEff HOPE H R A V 000.00 281 0 02 7305 ~SND AVE N ~401 XYLON AVE N STATUS: CURRENT CONSTRUCT/ON YEAR NEN HOPE fin N 125 FT OF LOTS $ AND ~ SUBJECT TO ROAD ,TAXABLE flARKET .00 D/V/S/ON NO GROSS TAX CAPAC/TY ~IUAL/FY/NG ANT / NET TAX CAPAC/TY FD SHARED TC D/V/S/ON DATE RENTAL TAX FD ARE~ RATE 00000000 SEE ID S ZF PROd ANT /F PROJECT NO. 1606 TAX LEVY/DESCRIPTION HflSTDPRTYP RATE AflOUNT LAND BLDG HACk OHN~ BASE1 BASE2 NHBASE NON-HI~T EXEHPT N VL 09856 ST ~HP # 387 69~.9~ 11~61 STREET ~HPROVE~ENT R~$1 1,$65.68 TOTAL TAX 2,058.62 ART UNPAID 2,058.62 ! TOTAL PAID .00 El, RUN DATE 08/24/90 TOTAL PARCELS 17 17' 17 17 17 17 '17 17 17 17 17 17 17 17 17 17 17 17 17 17 17 17 17 17 '17 17 17 17 17 17 17 17 17 17 17 17 17 17 17 17 17 *-......17 17 17 17 17 17 17 17 17 17 ,?,CH PROPERTY ZD DTST HENNEPZN COUNTY PROPERTY/~~3~TEH INCREHENT FINANCE/FROZEN VALUES ~ HTR SHR PROP HHSTD SHD DIST TYPE CODE LAND BUZLDZNG HACHZNERY 118 21 21 0002 281 0 02 CC 118 21 21 0003 281 0 02 CC 118 21 21 0007 281 0 02 CC 118 21 21 0008 281 0 02 C 118 21 21 0010 281 0 02 R 118 21 21 0023 281 0 02 R 118 21 21 002¢ 281 0 02 R 118 21 21 0025 281 0 02 R 118 21 21 0030 281 0 02 A 118 21 21 0031 281 0 02 CC 118 21 gl 0032 281 0 02 CC 118 21 21 0033 281 0 02' R 118 21 21 003¢ 281 0 02 CC 118 21 21 0035 281 0 02 CC 118 21 21 00¢9 281 0 02 A 118 21 22 0005 281 0 02 CC 118 21 22 0006 281' 0 118 21 22 0007 281 0 02 IX 118 21 22 0008 281 0 02 Il . 118 21 22 0011 281 0 02 CC 118 21 22 0012 281 0 02 CC 118 21 22 0013 281 0 02 CC 118 21 22 001¢ 281 0 02 C 118 21 22 0015 281 0 02 " CC 118 Z1 22 0017 281 0 02 C 118 21 22 0033 281 0 02 CC 118 21 22 0034 281 0 02 CC 118 21 23 0001 281 0 02 *CC 118 21 23 0002 281 0 OZ R 118 21 23 0003 281 0 02 Il 118 21 23 000¢ 281 0 02 118 21 23 0005 281 0 02 ZZ 118 21 23 0007 281 0 02 Z 118 21 23 0008 281 0 02 IX 118 21 23 0011 281 0 02 R 118 21 23 0012 281 0 02 R 118 Z1 ~3 0013 281 0 02 IX 118 21 2¢ 0002 281 0 02 CC 118 21 2¢ 0003 281 0 02 CC 118 21 2¢ 000¢ 281 0 02 CC 118 21 2¢ 0005 281' 0 02 C 118 21 2¢ 0007 281 0 OZ CC 118 21 2¢ 0060 281 0 02 CC 118 21 2¢ 0061 281 0 02 VL 118 21 2¢ 0062 281 0 02 A 118 21 2¢ 0063 281 0 02 A 118 21 2¢ 0088 281 0 02 A 118 21 24 0089 281 0 02 A 118 21 24 0090 281 0 02 CC 118 21 24 0091 281 0 OZ CC 118 21 24 0092 281 0 02 A 118 21 24 0093 281 0 02 A 118 21 2¢ 0105 281 0 02 A N 59,100 N 29,500 N $¢,000 N 15,700 H 17,000 N H 17,500 H N 126,000 N 15¢,000 N 60,100 H 17,000 N 28,600 N 99,200 N ¢17,900 N Z35,000 N ¢3,500 :N ¢1,500 N 51,600 N .97,000 N 90,000 N 122,500 N 1¢,100 N 68,900 N 11,000 N 59,500 N 91,600 N Il0,200 N N 1¢9,500 N 22,100 N 167,200 N 118,000 N N N 86,900 N 52,700 N 2¢0,000 N 37;000 N 11,000 N 50,000 N 52,500 N 52,500 N 36,800 N 36,800 N 36,800 N 36,800 N 31,500 N 29,700 N 36,800 N 36,800 N 42,000 24,600 15,200 166,000 16,700 '~*,500 47,500 976,500 130,000 29,300 60,100 97,000 221,700 3,467,100 525,000 216,500 192,800 388,¢00 193,000 210,000 ¢7,000 97,700 295,700 1¢6,500 202,300 573,000 99,400 238,200 687,000 lll,O00 35,700 385,000 72,000 112,500 120,700 120,700 120,700 120,700 75,500- 57,700 120,700 ILO,700 248,000 REPORT NO: PX316801 PAGE NO: 522 TOTAL HARKET TAX VALUE CAPACZTY · 83,700 2,678 44,700 1,430 200,000 8,150 32,400 1,604 61,500 615 65,000 . 650 1,102,500 284,000 89,400 77,100 125,600 320,900 3,885,000 760,000 260,000 234,300 ~.0,000 290,000 300~000 169,500 14,100 166,600 11,000 355,200 238,100 312,500 722,500 121,500 405,400 805,000 197,900 625,000 81,400 ll,O00 122,000 165,000 52,500 '157,500 157,500 157,500 157,500 107,000 87,400 157,500 157,500 290,000 39,690 12,308 2,861 862 ¢,467 14,135 139,860 35,870 11,1~'0 9,8~8 20,030 12,605 13,100 6,640 698 6,¢97 15,83Z 10,036 13,719 34,014 6,014 18,317 38,098 8,046 2,829 29,188 2,605 4,289 6,418 2,599 5,670 5,670 5,670 5,670 3,5~7 2,797 5,670 5,670 10,4~0 CITY OF NEW HOPE CASH FLOW PROJECTION TIF DIST NO. 8 BEGINNING CASH "Attachment C" CASH FLOW PROJECTION WIT LOAN TO AUTOHAUS WITH REPAYMENT REVENUE: TAX INCREMENT 142,109.31 280,000.00 280,000.00 280,000.00 280,000.00 280,000.00 INTEREST 62,000.00 27,246.56 36,949.85 47,209.84 58,378.17 69,938.20 LOAN REPAYMENT 41,435.00 41,435.00 41,435.00 41,435.00 41,435.00 TOTAL REVENUE EXPENDITURES: BOND PRIN BOND INT FISCAL AGENT FEES CONSTRUCTION COSTS OTHER COSTS 75,000.00 80,000.00 80,000.00 90,000.00 95,000.00 109,960.00 105,385.00 100,506.00 95,146.00 89,131.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 200,000.00 CITY OF NEW HOPE CASH' FLOW PROJECTION TIF DIST NO. 8 BEGINNING CASH 996 1997 1998 1999 2000 2001 ...... REVENUE: TAX INCREMENT 280,000.00 280,000.00 280,000.00 280,000.00 280,000.00 280,000.00 INTEREST 82,252.74 95,396.74 106,963.17 119,082.46 132,126.00 145,888.56 LOAN REPAYMENT 41,435.00 TOTAL REVENUE EXPENDITURES: BOND PRIN BOND INT FISCAL AGENT FEES CONSTRUCTION COSTS OTHER COSTS 100,000.00 105,000.00 115,000.00 120,000.00 130,000.00 140,000.00 82,621.00 75,623.00 67,975.00 5.9,690.00 50,750.00 40,960.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 2,000.00 CASH BALANCE CITY OF NEW HOPE CASH FLOW PROJECTION TIF DIST NO. 8 BEGINNING CASH REVENUE: TAXlNCREMENT INTEREST LOAN REPAYMENT TOTAL REVENUE 2OO2 2003 2OO4 280,000.00 280,000.00 280,000.00 160,464.28 175,954.13 192,466.38 EXPENDITURES: BOND PRIN BOND INT FISCAL AGENT FEES CONSTRUCTION COSTS OTHER COSTS 150,000.00 160,000.00 170,000.00 30,300.00 18,750.00 6,375.00 2,000.00 2,000.00 2,000.00 6~?~.AISAL ~PO~ 7]05 ~2nd Ave. No. Naw ~ope, ~£nnesoci ~£vervay Company AND DATE OF APP.~AZSAL The C£cy of Rev Hope is comsiderin$ improvin$ the ~2md Avenue Notch corridor, also known as County Rd. 9 or Rockford Rd. Th£s project involves upsradin$ various £ncerseccions, wtdenin$ Ave. No. in ocr=sin areas and Lim£c£ng access ~rom ce==a£n p=ope=~£es. The subject property is parc of the street v~denin$ ~hac will be considered v~chin chis improvement p~o$~am. T~e p~rpoae of chis s~ET appraisal is co estimate the marker value of the propeccy in order co establish the basis compensation i~ the property is acquired. A complete before and a£cer ana~ys~e has nec been undercaken because o~ the relative insignificance of the takeRS. TAts summaL~ or. scrip appraisal ~ef~eccs on~y owe ~Lue o~che parc oaken. ~a subject property vas inspected on ~a7 30. ~988.' and a~ valuaci~ conc~uai~8 re~Lve ac~d chic point ~n c~me. KALKXT VAL~B -- The hishesc price in reline of money which a property vail brin$ in a competitive and open marker under all c~adLcione requisite co a fair sa~e. the buyer and seller, each aec~S p~denc~y. ~ovLedseab~7 and ass~flj pc~ae to ~oc affected by ~due ~mpLLcL~ Ln chis definition is the consummation of a sale as of i specified dace and the pasain$ of title from seller co buyer ,.mder conditions vhereby: buyer and seller are cTpically motivated. 2. both parches are yell informed or yell advised, and each acc~n$ in whiz he considers his own best interest. 3. a reasonable c~me is allowed ~or exposure in the open earkec. 6. cbs prtaa represents a norua~ consideration ~oc the pco~er~7 ,o~d ~ffecced b7 spectaL ~nanc~nl a~cs .._ and/o~ ce~. semites. ~ees. costs, o~ c~edtcs ~nc~ea ~n cae c~ansacc~on. P~OP~TT IDENTIFICATION r. and only $ S2,S00 $t3,300.0i XnaXudea special aeeeeeueu~ paTueu~ of: $~0S.82 I~mainin~ klauee fpeetal A~eessueu~e: $ A~I~AISAL R~PO~ ~Lverv&y LOCATION AND NE!~HBORHO0~ developed second-r~n$ subucb nor~hwes~ of MlnneapoL£s. .~he c~7 has presen~ population of approz£macel7 13,000. recreational areas. ~e Hec~opoL~can Co~c~L entices ~he average ·ean value o~ ~n~Le family homea ~n the area co be approx~na~eL~ ~tnu~e8 fr~ do~co~ H~elpoL~s. I~s proz~n~y ~o do~co~ ~eapoLLs v~LL continue co be ~cs sc~onsesc asset, po~Llc~on vorka Ln d~c~HLnneapoL~s and ~Lves ~n oho suburb. · d. ~8 ~ che~81 ~d T. a. ~00/~60 on oho ~e sUbJec~ pro,ere7 ~s ~ocaced ~n oho souchvesc A~. ~. and Se~ &vs. ~2nd Ave. No. Lo a beyond. To the vest £s &n £ncs~nL~ of of~Kca buKldKnss and sKn$1e, sco~Y ~acaLL buLLdLnSs. To chi no=~h, across ~2nd Ave. irt vtcan~ parcels w~ch ~Lc~-famLLy ~eltden~aL bayard. ~s~e access fz~ 42nd A~. ~Lch vl~L be c~oaed. ~cesa co ~nd sales ~ co & rep~esene sales £m reasonable co the subJece pro~e=~y. These ranle ~n price ~rom $2.90 $&.Bb per square ~ooc. Sale ~ Ks across she street the subJece. ~ Ks a corme~ ~ocacion. A ~asc ~ood cha£n purchased the sics co reuse Kc ~or a restaurant. Sales a~ and · 2 are ab~Ae ~vQ miles veee o~ subJece-and vere ~rchazed retail aueo se~ice use. ~e lubJec~ pwo~e~y ~J zoned ~-3. auto oriented bua~ne~. I~ rece~ ~he c~e~c~/ ~nfluences froa ~he s~o~d~nl bus,ness p~opercie8, particularity co the ease. Because of e~os~e on ~2~d Ave. and Les co,er ~o~acion. Lc Is ~eLc c~e properc7 ~d re'fleet a ve~ue c~ard the uppe~ end of cerise of the e~rable sales. vtch~ chLo az~ ~d ~.co~8~nS the vari~o d~erenceo bem~ ~he ~a~ of ~heoe p~o~er~ies and ~he pz~e~. L~ ~o ~opLnl~ ~ the va~e o~ ~he Land / · ,~~ 1.01' ~URVEY~ COMPANY, INC. ','.'~?'~,,o'."°' ~'~ ' 0- OE~TES ~ 8 (l,,lennepin Cmmty Au4~cor) · .- -- G I~q°'~o' ,BS ",~ a pe~ e~t for s~r~ ~d utility p~ses ~er, ~der ~d ~ss t~ pa~ oE s~ly ~ ~d e~t line ~rm its incers~tim vith the 9~ line of line ~ L~ 1, Bi~ 6, R~o~ P~k ~d there temPtS. Area in pemaaent street eument · 12S Scl. Ft. Area in teagoriry construction en~eoeslC · Z,40t Sq. DC. Note: Sketch rely, no irms hive been set to establish property l~nes.