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HomeMy WebLinkAboutSeptember 27, 2004OFFICIAL PROCEEDINGS CITY OF COLUMBIA HEIGHTS CITY COUNCIL MEETING SEPTEMBER 27, 2004 The following are the minutes for the regular meeting of the City Council on Monday, September 27, 2004 in the City Council Chambers, City Hall, 590 40th Avenue N.E., Columbia Heights, MN. Mayor Wyckoff indicated that an EDA meeting preceded this meeting. Pastor Theresa Taylor, Oak Hill Baptist Church, gave the Invocation. CALL TO ORDER/ROLL CALL Mayor Wyckoff called the meeting to order at 7:38 p.m., immediately following the Economic Development Authority meeting. Present: Mayor Wyckoff, Councilmember Williams, Councilmember Nawrocki, Councilmember Ericson, Councihnember Kelzenberg. PLEDGE OF ALLEGIANCE - Recited ADDITIONS/DELETIONS TO MEETING AGENDA Motion by Ericson, second by Williams, to table items 7E and 7F, per staff recommendation. Upon vote: All ayes. Motion carried. PROCLAMATIONS, PRESENTATIONS, RECOGNITIONS AND GUESTS Proclamations 1) Polish American Heritage Month Dolores Strand, Sister Cities Co-Chair, read the Proclmnation. Strand indicated that she and Walter Logacz attended the Sister Cities National Conference in Texas. The Wheelchairs for Peace Foundation has indicated that Columbia Heights would be the smallest community in the United States to contribute the $18,000 required for the container of 240 wheelchairs. Colmnbia Heights pins have been shared with people in all areas of the world, which raises the profile of Columbia Heights. Strand indicated that four people from Columbia Heights just returned from our Sister City, Lomianki, Poland where they attended the American Flyers Ceremony. Strand listed the events, speakers and places they visited. Their library has requested more interaction with our Library. Three checks were donated to the children's hospital, for which they were very appreciative. The Sister Cities Colmnittee will sponsor a fundraiser concert on Sunday, October 17 at 4:00 p.m., at First Lutheran Church, featuring a noted pianist. She indicated where tickets could be purchased. Wyckoff gave the history, of the American Flyers Ceremony, and Columbia Heights resident Walter Szymczak being shot down in Lomianki. Strand passed along the warm wishes of the Polish dignitaries. 2) Domestic Violence Awareness Month Mayor Wyckoffread the Domestic Violence Awareness Month Proclamation. Presentations - none City Council Minutes September 27, 2004 Page 2 of 21 Introduction of New Employees 1) Bridget Hill, Police Secretary IIA Police Chief Tom Johnson introduced Bridge Hill, who was previously employed by the New Hope Police Department, records division. Johnson indicated that Ms. Hill already has all of the required certifications. 2) Jesse Davies, Public Works Administrative Assistant Kevin Hanson, Public Works Director introduced Jesse Davies, who comes from Lennox, South Dakota and gave his background. Recognition - none CONSENT AGENDA Walt Fehst, City Manager, took Councilmembers through the Consent Agenda items. 1) Approve City Council Meeting Minutes a) Motion to approve the minutes of the September 9, 2004 special City Council meeting as presented. b) Motion to approve the minutes of the September 13, 2004 regular City Council meeting as presented. c) Motion to approve the minutes of the September 15, 2004 City Council Election Canvass meeting as presented. 2) Accept Boards and Commissions Meeting Minutes a) Motion to accept the July 28, 2004 minutes of the Park and Recreation Commission b) Motion to accept the September 8, 2004 minutes of the Planning and Zoning Commission c) Motion to accept the August 17, 2004 minutes of the Economic Development Authority d) Motion to accept the September 7, 2004 minutes of the Library Board 3) Establish Budget Work Session meeting dates Motion to set budget work session meeting dates to review the 2005 budget for the following Mondays: October 4, October 18, November 1, November 15, November 29, and December 6. 4) Approve Application for Raffle for the Courage Center of Golden Valley Motion to direct the City Manager to forward a letter to the State Charitable Gambling Control Board indicating that the City of Columbia Heights has no objection to a raffle event to be conducted by Courage Center of Golden Valley in conjunction with a wheelchair basketball tournmnent on October 15, 2004 at the Columbia Heights High School, 1440 49th Avenue NE, Columbia Heights; and furthermore, that the City Council hereby waives the remainder of the sixty-day notice to the local governing body. Fehst stated there is a resohttion that allows for this. 5) Establishing Amount of Assessments to be Levied Motion to waive the reading of Resolution No. 2004-57, there being ample copies available to the public. Motion to adopt Resolution No. 2004-57 being a Resolution establishing amount of City share and amount of Special Assessments on Projects to be levied. City Council Minutes September 27, 2004 Page 3 of 21 Fehst listed the amounts to be assessed. Nawrocki asked the comparison to the amozmt indicated at the Improvement Hearing. Hansen stated this amoztnt is aboztt a 3.3 percent decrease and will be reflected in the amount assessed to residents. RESOLUTION NO. 2004-57 CITY OF COLUMBIA HEIGHTS BEING A RESOLUTION ESTABLISHING AMOUNT OF CITY SHARE AND AMOUNT OF SPECIAL ASESSMENTS ON PROJECTS TO BE LEVIED WHEREAS, the City Council of the City of Columbia Heights by motion on the 23rd day of August, 2004, ordered a special assessment hearing to levy the cost of improvements and; WHEREAS, the following projects will be specially assessed in October, 2004, and a portion of the costs may be borne by the City, NOW THEREFORE BE IT RESOLVED pursuant to Minnesota Statutes 429.061, and City Code 4.103, that the breakdown is as follows: Proiect Estimated Assessed Estimated City Portion Portion Total Zone 7A Street Construction Project $504,400 $820,400 $1,324,800 Zone 7A General State Aid, Utility Funds $459,000 $-0- $459,000 6) Authorization to seek bids for architectural services for a building maintenance project at the MSC. REMOVED 7) Adopt Resolution No. 2004-59, being a Resolution supporting MnDOT consideration of a cost sharing municipal agreement for construction of a drainage facility on T.H. 65 south of 49th Avenue Motion to waive the reading of Resolution No. 2004-59, there being ample copies available to the public. Motion to adopt Resolution No. 2004-59, being a Resolution supporting MnDOT consideration of a cost sharing municipal agreement for construction of a drainage facility on T.H. 65 south of 49th Avenue RESOLUTION NO. 2004-59 BEING A RESOLUTION REQUESTING Mn/DOT CONSIDERATION OF FUNDING THROUGH THE MUNICIPAL AGREEMENT PROGRAM FOR THE RECONSTRUCTION OF EXISTING DRAINAGE FACILTIES WHEREAS, the City of Columbia Heights proposes to make certain drainage facility improvements on T.H. 65, south of 49th Avenue. WHEREAS, the improvements will benefit both the City of Columbia Heights and the Minnesota Department of Transportation. WHEREAS, the City of Columbia Heights is committed to providing the local share of the costs if the project is selected as part of the Municipal Agreement Program. NOW THEREFORE BE IT RESOLVED by the City Council of the City of Columbia Heights that the City shall be responsible for the preliminary engineering, project design, and permitting functions of said improvements; and BE IT FURTHER RESOLVED that the construction costs of the improvements be shared between the Minnesota Department of Transportation and the City of Columbia Heights; and BE IT FURTHER RESOLVED, that following approval by the Minnesota Department of Transportation of plans and specifications for said improvements, and before the contract letting for the construction of said improvements, the Minnesota Department of Transportation shall prepare an agreement to provide for the State to pay its share of the costs of the improvements in accordance with the latest "Procedures for Cooperative Projects with Municipalities". 8) First Reading of Ordinance No. 1476, being an Ordinance providing for the issuance and sale of approximately $2,045,000 G.O. Tax Increment Refunding Bonds, Series 2004A REMOVED Fehst stated that this is for Parlcview Villa Soztth and would save us $170, 000 a year. City Council Minutes September 27, 2004 Page 4 of 21 9) Establish a Heating date of October 11, 2004 for revocation or suspension of rental property license at 4612 Polk Street N.E. Motion to establish a hearing date of October 11, 2004 for revocation or suspension of a license to operate a rental property within the City of Columbia Heights against Marilyn Dalseth at 4612 Polk Street N.E. lO) Approve Rental Housing License Applications Motion to approve the items listed for rental housing license applications for September 27, 2004. 11) Approve Business License Applications Motion to approve the items as listed on the business license agenda for September 27, 2004 as presented. 12) Approve Payment of Bills Motion to approve payment of the bills out of the proper funds as listed in the attached check register coveting Check Number 109900 through 110067 in the amount of $1,129,467.30. Motion by Willimrts, second by Kelzenberg, to approve the consent agenda, with the exception of item #6 and #8. Upon Vote: All ayes. Motion carried. #6 Municipal Service Center Nawrocki indicated he viewed the building and the roof and disagreed with the amount of work requested at this time. He questioned the need for a three level elevator, the roof could use some repair on the edges and around the vents, and the necessity of a wash bay for the lower level. Kevin Hansen, Public Works Director, stated this request is for design services for a preservation/maintenance project. An independent roof professional has analyzed the roof and reconuuended complete roof replacement, as there are two levels of roof with leakage and concern for weight limits. Other improvements are for security systems and facilities for women. The addition of an elevator would be required with any improvements of over $100,000. The building exterior has deteriorating masonry and this work would extend the life of the building. Staff has requested the addition of a lower level wash bay to wash the large equipment and improve sediment removal. The main floor is a reinforced concrete floor and is on a maintenance schedule at a cost of $20-$25,000 per year. Hansen stated that funds have been set aside at about $75,000 per year for this project, with about $375,000 in that fund. Remaining funds would be borrowed internally. Fehst stated there are about eight spots on the roof which leak that are causing water damage to the roof insulation and two spots where you can see light through the ceiling. Nawrocki reiterated his observations. Wyckoff co~rnuended staff for staying on top of this situation and planning ahead for payment of the repairs. Nawrocki questioned where the future funds required would come from. Fehst stated that Council agreement would continue support of the project through the yearly budget process. Williams stated this request is only for architectural service bids. He questioned the cost and indicated he has a friend that is a Columbia Heights architectural engineer that would probably do it for less. City Council Minutes September 27, 2004 Page 5 of 21 Fehst indicated the necessity for women's restrooms and building security. The HVAC is the original system. Our intent is to consider options of the Honeywell and cleaning service contract versus local maintenance and our own cleaning personnel. Hansen stated we have been aware of the smaller problems, but deferred them to do one main project, with the hope of getting a better value. Ericson stated this has been in the planning process for a long time, and is glad that staff goes through the process to set aside funds. She felt Council should follow through and do their part to allow the necessary maintenance to be done. Motion by Ericson, second by Kelzenberg, to authorize Public Works to seek bids for Architectural Services for plan development and inspection services for the MSC Building Maintenance Project. To answer Council's question, Hansen stated the roof is now 17 years old and the consultant indicated the normal life of roof is 11 to 12 years. Upon vote: Kelzenberg, aye; Williams, aye; Ericson, aye; Nawrocki, nay; Wyckoff, aye. 4 ayes -1 nay. Motion carried. #8 First Reading of Ordinance No. 1476, being an Ordinance providing for the issuance and sale of approximately $2,045,000 G.O. Tax Increment Refunding Bonds, Series 2004A Mark Ruff, Ehlers and Associates, Financial Consultant for the City, indicated review of the 1990 Bond interest rate, now at over seven percent, which today could be less than three percent. This has been discussed for two years. This should save nearly $1 million dollars and assist in covering property tax shortfalls or enhance the City budget. The only downside is the Charter requirement for two readings of an Ordinance and a 30 day waiting period, which can determine the final rate received. He suggested the Charter Cormriission review this. Fehst questioned if selling Parkview Villa would be a problem. Ruff stated that if sold to a private business, the bonds would need to be paid. Motion by Nawrocki, second by Williams, to waive the reading of Ordinance No. 1476, there being ample copies available to the public. Upon Vote: All ayes. Motion carried. Motion by Nawrocki, second by Williams to schedule October 11, 2004 at approximately 7:00 p.m. in City Council Chambers for the second reading of Ordinance No. 1476 being an ordinance providing for the issuance and sale of approximately $2,045,000 in Tax Increment Refunding Bonds, Series 2004A. Upon Vote: Kelzenberg, aye; Williams, aye; Ericson, aye; Nawrocki, aye; Wyckoff, aye. All ayes. Motion carried. PUBLIC HEARINGS A) Public Hearing called for Revocation/Suspension of Rental Housing License at 1019 3 7th Ave. Mayor Wyckoff closed the public hearing regarding the revocation or suspension of the rental license held by Erika Thom regarding rental property at 1019 37th Avenue N.E. in that the property owner has corrected a significant number of the deficiencies inside and outside the building, and has received an extension to complete the work. Ericson stated this owner has been on the agenda for revocation several times, and questioned if it is for the same property or other rental properties. Fehst stated that staff would research this. City Council Minutes September 27, 2004 Page 6 of 21 B) Public Hem-ing called for Revocation/Suspension of Rental Housing License at 208-10 42nd Ave. Mayor Wyckoff closed the public hearing regarding the revocation or suspension of the rental license held by Tahazib Bacchus regarding rental property at 208-210 42nd Avenue N.E. until such time all interested parties can be properly notified. c) Public Hearing called for Revocation/Suspension of Rental Housing License at 1635 49th Ave. Mayor Wyckoff close the public hearing regarding the revocation or suspension of the rental license held by Abullahi Elmi regarding rental property at 1635 49th Avenue N.E. in that the property owner has corrected some of the deficiencies inside the building and has received a extension to complete the work on the outside of the building, and as of September 30, 2004 the property will be vacated and no longer be used as rental property. Deb Johnson, 999 41st Avenue, disagreed with allowing time extensions, as it will soon be winter and the work will not be done. We need to keep up the rental properties in the co~mnunity. ITEMS FOR CONSIDERATION Other Ordinances and Resolutions 1) INDUSTRIAL AREA a) Adopt Emergency Ordinance No. 1474, an ordinance repealing Ordinance No. 1471 ending a moratorium on development in Industrial Park Master Plan area Randy Schumacher, Cormnunity Development Assistant and Project Manager for the Industrial Area Park, indicated the following issues are for land use and redevelopment in the industrial area. Over two years ago the City Council designated 28 acres for redevelopment in the industrial area. Planning funds were received from the County. Contamination was found and $1,300,000 was received fi.om the State and Met Council for removal of the industrial contamination. $4-5,000,000 will be required to clean up the land. Funding is available, however a redevelopment agreement for the area following clean up is required. The EDA has approved a development agreement with Schafer Richardson and another clean up grant will be submitted in November. Ellen Berkelhamer, City Planner, indicated that a moratorium was established in 2002 for certain properties identified in Phases 1 and 2 of the Master Plan. The planning process has been completed and the moratorium can be lifted. Steve Bubul, Kennedy and Graven, indicated the property owners would be notified. Nawrocki disagreed with this being an emergency ordinance. Berkelhamer indicated that Council can not take action on the redevelopment process until the moratorium is lifted. Motion by Kelzenberg, second by Ericson, to waive the reading of Emergency Ordinance No. 1474, there being ample copies available to the public. Upon vote: All ayes. Motion carried. Motion by Kelzenberg, second by Ericson, to adopt Emergency Ordinance No. 1471, being an Ordinance repealing Emergency Ordinance No. 1471 and ending the moratorium on the use of property identified in Phase I and II of the Industrial Park Master Plan for the City of Columbia Heights. Upon vote: Kelzenberg, aye; Williams, aye; Ericson, aye; Nawrocki, aye; Wyckoff, aye. 5 ayes. Motion carried. EMERGENCY ORDINANCE NO. 1474 CITY OF COLUMBIA HEIGHTS, MINNESOTA BEING AN EMERGENCY ORDINANCE REPEALING EMERGENCY ORDINANCE NO. 1471 The City of Columbia Heights does ordain: Section 1: On July 8, 2002, the City of Columbia Heights adopted Emergency Ordinance No. 1449, which was an ordinance that was created in an effort to protect the strategic planning process, health, safety, City Council Minutes September 27, 2004 Page 7 of 21 and the general welfare of the public for the City of Columbia Heights; and Section 2: On June 9, 2003, the City of Columbia Heights adopted Ordinance No. 1457, extending the moratorium for the Light Industrial zoned properties to protect the strategic planning process, health, safety, and the general welfare of the public for the City of Columbia Heights; and Section 3: On Jnne 14, 2004, the City of Columbia Heights adopted Ordinance No. 1471, extending the moratorium as of July 8, 2004 for six months to protect the strategic planning process, health, safety, and the general welfare of the public for the City of Columbia Heights, recognizing that said time period may be shortened at anytime by the City Council; and Section 4: On July 7, 2004, the Planning & Zoning Commission conducted a public hearing to consider a Comprehensive Plan ganendment and Rezoning for the industrial area as part of the strategic planning process and therefore the strategic plamfing process is now complete. Section 5: The City Council determines that Emergency Ordinance No. 1471 may be repealed because the strategic plalming process to determine the highest and best use for the industrial zone properties has been completed. b) Adopt Resolution 2004-58, Case #2004-0702 Industrial Park Comprehensive Plan Amendment Berkelhamer showed a site plan of the area and described the boundaries. She described the actions previously taken and the desire to enter into a developer's agreement with Schafer Richardson for development of this area. This would require a zoning change from Industrial to Transit Oriented Development. The plan is consistent with the goals within the Comprehensive Plan. It would also provide life cycle housing, and increase pedestrian/bicycle transit. The Planning Co~mnission voted unanimously for the City Council to approve this Comprehensive Plan Amendment. This mnendment would then go to the Met Council for their review. Wyckoff indicated this requires a 4/5th vote. Nawrocki stated his opposition to this project, as it would remove 60 percent of the City's industrial property. The area is not in good shape, but could be revitalized. The proposed density for the area is too high. He referred to problems in other high density areas of the city. He stated that he is not convinced this will improve the community tax base. He felt it would take 26 years before the Tax Increment would pay for the up front costs. Nawrocki stated that this development would be equivalent to adding two cities the size of Hilltop to our con-nnunity, and the city would pay a disproportionate share of road costs, and utility costs. Nawrocki indicated he was told the owners could not be required to keep the homes owner occupied. Ericson stated her appreciation for concern in removing industrial area, but felt our community might not be suited for industrial. She indicated that density does not necessarily mean problems, and stated displeasure with the statement that this will be two City of Hilltops. This issue is regarding the Comprehensive Plan and what we want to do with our community. Ericson stated confidence in the project and pointed out support of the State and Met Council with funding. Kelzenberg stated that experts indicate this is not a good area for industrial and is presently an eye sore. If we don't do anything, it will stay an eye store. He felt this would probably be the best asset to come into our colmuunity. Wyckoff stated this area had a beautiful view of downtown Minneapolis and should not be industrial, and be better suited to owner occupied $300,000 townhomes. There is a glut of industrial in the metro area already. Wyckoff indicated that this property has been decaying for years and we now have a chance to move forward and should do so. City Council Minutes September 27, 2004 Page 8 of 21 Williams stated this area is really polluted with toxic chemicals and needs to be cleaned up and at this point, industrial is dead in this area.. He indicated that we need to approve this to continue receiving funds to clean up the area. Williams asked the number of units proposed. Berkelhamer indicated 183 town homes 296 flats and 80 co-op units. Williams stated the length ofpayback is too long, but agreed new homes will attract people. He indicated there would be demands to our city that we would have to address. Deb Johnson stated that any redevelopment is better than we have now. Nawrocki stated that the City has not done a thing about having the property owners clean up the trash, junk cars, and weeds in this area, which doesn't help to bring in interested businesses. JoAnn Student, 1645 49th Avenue, stated displeasure that the public meeting was delayed until after the EDA meeting. She indicated that a negative attitude toward this project was not acceptable and offered her support for the redevelopment. The credit for this development should go to City Staff and the Developer. She felt the Developer should be given an apology by the City Council and should be recognized for their professionalism. Student referred to chastising developers regarding rental property, but we can not stop them from including rental. Wyckoff indicated that four Councilmembers supported the project. Mickey Rooney, a local realtor, indicated this project is a real positive. He felt that elderly people want townhomes in Columbia Heights so they can stay in this area. Motion by Kelzenberg, second by Williams, to waive the reading of Resolution 2004-58, there being ample copies available to the public. Upon vote: All ayes. Motion carried. Motion by Kelzenberg, second by Williams, to approve Resolution 2004-58, being a resolution pertaining to a Comprehensive Plan amendment for certain properties located at 317 37th Avenue NE; 450, 515, and 517 38th Avenue NE; 510, 550, 600 and 620 39th Avenue NE; and 3700, 3800, 3801 and 3901 5th Street NE. Upon vote: Kelzenberg, aye; Williams, aye; Ericson, aye; Nawrocki, nay; Wyckoff, aye. 4 ayes - 1 nay. Motion carried. RESOLUTION 2004-58 A RESOLUTION PERTAINING TO A COMPREHENSIVE PLAN AMENDMENT FOR CERTAIN PROPERTIES LOCATED AT 317 37TH AVENUE NE; 450, 515, AND 517 38TH AVENUE NE; 510, 550, 600 AND 620 39TH AVENI. ZE NE; AND_ 3700, 3800, 380! _~_ND 390! 5TH ST_R_EFET NE WHEREAS, the City of Columbia Heights adopted the Industrial Area Redevelopment Plan to set a framework for redevelopment options for the greater Industrial Park area with the objectives of providing a catalyst for change in the area; and WHEREAS, the City of Columbia Heights recognizes that the Industrial land use designation of subject properties in the Comprehensive Plan does not allow the flexibility needed to accommodate successful redevelopment in accordance with the Industrial Area Redevelopment Plan; and WHEREAS, the Industrial Park Redevelopment Plan is consistent with the description of the Transit Oriented Mixed Use-District; and WHEREAS, the Metropolitan Council's residential density guidelines for "Developed" communities is 5 units plus per acre, with higher densities in locations with convenient access to transportation corridors and the overall residential development proposed for the Industrial Park is approximately 20 units per acre; and WHEREAS, the Comprehensive Plan Amendment supports other policies of the Metropolitan Council such as reinvestment/redevelopment, providing a mix of uses, planning pedestrian and bicycle connections between workplaces, residences, retail and services, using mixed use development and transit oriented development zoning, increasing density along University Avenue NE fo support transit services, providing City Council Minutes September 27, 2004 Page 9 of 21 a mix of residential types and densities to provide the opportunity for lifecycle and affordable housing, and reclaiming contaminated lands for redevelopment; and, WHEREAS the City's approval of the Comprehensive Plan amendment for the Industrial Park area is contingent on Metropolitan Council review and the amenchnent will be sent to the Metropolitan Council accordingly; and BE IT FURTHER RESOLVED that the Planning and Zoning Commission conducted a public hearing to review the Comprehensive Plan Amendment and recommends approval of the proposed mnendment changing the land use designation for the subject properties from Industrial to Transit Oriented Development. c) First Reading of Ordinance No. 1475, Case #2004-0702, Industrial Park Rezonin~ Berkelhamer stated the Comprehensive Plan sets City policy, and the zoning ordinance enforces that plan. She showed a map of the area of the proposed rezoning and described the boundaries. This rezoning will create non-conforming use of the current industrial area. The existing users can continue to operate, but could not expand. State law indicates that if a business is destroyed it can be replaced if the building permit is obtained within 90 days. This rezoning required a hearing by the Planning and Zoning Colmnission, which was approved unanimously. Motion by Ericson, second by Kelzenberg, to waive the reading of Ordinance 1475, there being ample copies available to the public. Upon vote: All ayes. Motion carried. Motion by Ericson, second by Kelzenberg, to establish a second reading of Ordinance 1475, being an Ordinance pertaining to Zoning and Development Ordinance No. 1428, pertaining to the rezoning of certain properties located at 317 37th Avenue NE; 450, 515, and 517 38th Avenue NE; 510, 550, 600 and 620 39th Avenue NE; and 3700, 3800, 3801 and 3901 5th Street NE for October 11, 2004 at approximately 7:00 p.m. in the City Council Chambers. Nawrocki questioned if 3700 5th Street was occupied by the envelope business. Berkelhamer indicated that the envelope business property is not part of this zoning change. Officer Paul Bonesteel indicated the envelope business address is 455 37th Avenue. Ruff stated that according to the property tax records 3700 5th Street is owned by the Grief Brothers. Upon vote: Kelzenberg, aye; Williams, aye; Ericson, aye; Nawrocki, nay; Wyckoff, aye. 4 ayes - 1 nay. Motion carried. d) Resolution 2004-53, Record of Decision for a Negative Declaration of the Need for an Enviroranental Impact Statement (EIS) for the Industrial Park Redevelopment Berkelhmner stated this Resolution approves findings that the preparation of an EIS is not necessary for the Industrial Park redevelopment, thereby allowing a negative declaration of the need for an EIS and approving the Record of Decision. The Environmental Assessment Worksheet (EAW) describes the potential enviromnental impacts to traffic, storm sewer, schools, noise, and odors. On August 9th the City Council approved passing this on for review and comment by the required 30 agencies. Four cmmnents were received, none of which indicated the need for an EIS on the proposed project. Wyckoff described the questions raised by the agencies. Berkelhamer stated that some questions only needed clarification. They were indicative that additional study was not needed. City Council Minutes September 27, 2004 Page 10 of 21 MOTION by second, second by Nawrocki, to waive the reading of Resolution 2004-53, there being ample copies available to the public. Upon vote: All ayes. Motion carried. MOTION by Ericson, second by Nawrocki, to adopt Resolution 2004-53, being a resolution approving a negative declaration of the need for an Environmental Impact Statement and approving the Record of Decision. Upon vote: Kelzenberg, aye; Williams, aye; Ericson, aye; Nawrocki, aye; Wyckoff, aye. All ayes. Motion carried. RESOLUTION NO. 2004-53 CITY OF COLUMBIA HEIGHTS, MINNESOTA A RESOLUTION ADOPTING THE RECORD OF DECISION REGARDING THE NEGATIVE DECLARATION OF THE NEED FOR AN ENVIRONMENTAL IMPACT STATEMENT FOR THE INDUSTRIAL PARK REDEVELOPMENT WHEREAS, Minnesota Rules Chapter 4410 contains the requirements for the Minnesota Environmental Quality Board ("EQB") Environmental Review Program; and WHEREAS, the scope of the Industrial Park Redevelopment required a mandatory Environmental Assessment Worksheet ("EAW") pursuant to Minnesota Rules Chapter 4410.4300 subp. 14; and WHEREAS, on August 9, 2004, the City of Columbia Heights, as the Responsible Governmental Unit ("RGU") for preparation of the Industrial Park Redevelopment EAW approved the EAW for distribution to the Environmental Quality Board ("EQB") distribution list and interested parties; and WHEREAS, the EAW was published in the August 16, 2004, edition of the EQB Monitor, which started the required 30-day public comment period that commenced on August 16 2004 and ended on September 15, 2004; and WHEREAS, the RGU received four comment letters that are provided in Appendix B to the Record of Decision and the comments received do not support a need for an EIS on the proposed project; and WHEREAS, responses were prepared for comment letters received and these responses to comments are provided in Appendix C to the Record of Decision; and WHEREAS, pursuant to Minnesota Rules, Section 4410.1700, the RGU shall base its decision regarding the need for an EIS on the information gathered during the EAW process, the comments received on the EAW, and the criteria established by the EQB to determine whether a project has the potential for significant environmental effects as provided in Appendix D to the Record of Decision; and WHEREAS, the RGU has prepared a Record of Decision (Attachment 1) that has been considered and reviewed by the City Council documenting the findings of fact and decision regarding the negative declaration of the need for an Enviroltrnental Impact Statement ("EIS") for the Industrial Park Redevelopment. BE IT FURTHER RESOLVED that the City Council of the City of City of Columbia Heights hereby approves the negative declaration of the need for an EIS and approves the Record of Decision. e) Adopt Resolution 2004-55, Adopting a Modification to the Downtown Central Business District (CBD) Revitalization Plan for the CBD Redevelopment Project and Establishing the Huset Park Area TIF District and TIF Plan - tabled. f) Adopt Resolution 2004-54, approving the elimination of parcels from the TIF 4 Multi Use Redevelopment Project (MURP) IC2 TIF District - tabled g) Adopt Resolution 2004-56, Approving a Contract for Private Redevelopment with Schafer Richardson Brad Schafer co-owner of Schafer/Richardson stated they have been a Columbia Heights industrial area property owner for six years. He described other redevelopment projects they have completed in the metro area. Schafer referred to the number of calls received from other builders expressing an interest in this redevelopment. He stated their gratitude for the positive colrnnunity response and the hard work by staff on this project. Steve Bubul, Kennedy and Graven, indicated this contract for private development would set the framework for the five year project. He listed the types of housing anticipated. Land acquisition is a key issue. Schafer Richardson now owns three parcels and will City Council Minutes September 27, 2004 Page 11 of 21 continue to obtain agreements for four more sites, at their Cost, including relocation fees. Bubul stated that contamination cleanup will include ahnost every parcel, with first phase clean up beginning upon approval of this contract. Costs for clean up will be shared with the developer, if grants are not received. The City would be involved in the parkway and storm water work, paid through State Aid. The Developer would be responsible for internal streets and roads, and hookups. Tax increment assistance, which makes this project possible, would be on a "pay as you go" basis. The developer pays for land, relocation, and site improvements, with the EDA's promise to pay back the estimated $7.9 million, with interest, over time. Once the project is built and TIF is flowing, the EDA would turn these into tax exempt revenue bonds, which benefits the developer and the EDA, but is not a risk to the city. Wyckoff asked the consequences if the units do not sell. Bubul stated that is the developer's risk; if the project slows down there would be less tax increment to pay the developer. Nawrocki stated this dealing is with a limited liability corporation, not the Schafer firm. We do not have any infonrtation on the corporation set up. Nawrocki questioned if we are committed to building a parkway. Bubul stated that we would be by approving this agreement. Nawrocki felt that general city monies would be used and then would not be available for other city projects like street repair. He indicated the disadvantage of "pay as you go" is a higher interest rate on the bond, meaning a longer payoff. Bubul stated that would be the reason to replace "pay as you go" with Tax Exempt Revenue Bonds, at a lower interest rate. Nawrocki asked how many bedrooms each unit would have. Bubul stated that detail would be determined during site development. Nawrocki questioned parking. Bubul stated that the majority of the development would not be completed until five years after the project beginning. Motion by Ericson, second by Kelzenberg, to end discussion. Nawrocki objected. Upon vote: Kelzenberg, aye; Williams, nay; Ericson, aye; Nawrocki, nay; Wyckoff, aye. 3 ayes - 2 nays. Motion carried. Motion by Ericson, second by Kelzenberg, to waive the reading of Resolution 2004-56, there being an muple amount of copies available to the public. Upon vote: All ayes. Motion carried. Motion by Ericson, second by Kelzenberg, to adopt Resolution 2004-56, a Resolution Approving a Contract for Private Redevelopment between the Columbia Heights Economic Development Authority, the City of Columbia Heights and Schafer Richardson, Inc. or a related entity. Nawrocki referred to item 2F of the agreement indicating 20 percent of the units must be within metro guidelines, and asked if that would be the same for Phases II and III. Bubul stated it would be reasonable to expect the same. Nawrocki referred to item 2G and asked if Council would see these plans. Bubul stated they would be treated the same as any building penuit, and each phase would need approval. Nawrocki referred to SAC/WAC charges. City Council Minutes September 27, 2004 Page 12 of 21 Wyckoff called for the question. Upon vote: Kelzenberg, aye; Williams, aye; Ericson, aye; Nawrocki, nay; Wyckoff, aye. 4 ayes -1 nay. Motion carried. Williams stated he would have liked more questions answered before voting. Nawrocki stated that he would not support the motion, as we do not know what the cost to the City will be, tax increment may be for 26 years, and the cost to provide City services to the area. Fehst thanked the citizens present for their support, and questions, and thanked Schafer Richardson for their professionalism. RESOLUTION NO. 2004-56 RESOLUTION APPROVING A CONTRACT FOR PRIVATE REDEVELOPMENT BETWEEN THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY, THE CITY OF COLUMBIA HEIGHTS AND SCHAFER RICHARDSON, INC OR A RELATED ENTITY BE IT RESOLVED By the City Council ("Council") of the City of Columbia Heights, Minnesota ("City") as follows: Section 1. Recitals. 1.01. The Columbia Heights Econonfic Development Authority ("Authority") has determined a need to exercise the powers of a housing and redevelopment authority, pursuant to Minnesota Statutes, Sections. 469.090 to 469.108 ("EDA Act"), and is currently administering the Downtown CBD Redevelopment Project ("Redevelopment Project") pursuant to Minnesota Statutes, Sections 469.001 to 469.047 ("HRA Act"). 1.02. The Authority, the City and Schafer Richardson, Inc. or a related entity (the "Redeveloper") have proposed to enter into a into a Contract for Private Redevelopment (the "Contract"), setting forth the terms and conditions of redevelopment of certain property within the Redevelopment Project, generally located east of University Avenue and south and west of Huset Park. 1.03. The Council has reviewed the Contract and f'mds that the execution thereof and performance of the City's obligations thereunder are in the best interest of the City and its residents. Section 2. City Approval; Further Proceedings. 2.01. The Contract as presented to the Council is hereby in all respects approved, subject to modifications that do not alter the substance of the transaction and that are approved by the Mayor and City Manager, provided that execution of the documents by such officials shall be conclusive evidence of approval. 2.02. Tlie Mayor and City Manager are hereby authorized to execute on behalf of the City tlie Contract and any documents referenced therein requiring execution by the City, and to carry out, on behalf of the City its obligations thereunder. Mayor Wyckoff called a five minute recess. PLANNING a) Adopt Resolution 2004-51, being a Lot Split, Case #2004-0901, 1813 40th Avenue NE/4041 Hayes Street NE Berkelhamer indicated this request is by Gladys Wychor to reconfigure the property line separating her property and 4041 Hayes Street, which would add more property to the adjacent owner. Any new construction on this property would have to be within the zoning ordinance guidelines. The Planning and Zoning Commission voted unanimously to approve the lot split. Mickey Rooney was present on behalf of the applicant. Nawrocki asked if there was a guarantee this would be attached to the lot on Hayes. Berkelhamer indicated the legal description of both properties would change. The parcel cannot become an isolated lot because there is no street access and it does not meet the requirements for a single lot. The addition of property could allow for a home expansion or a garage, but not a single home. There can only be two accessory structures and cannot exceed 1,000 square feet. The footprint can not exceed 30 percent of the lot. City Council Minutes September 27, 2004 Page 13 of 21 Motion by Nawrocki, second by Willimns, to waive the reading of Resolution 2004-51, there being ample copies available to the public. Upon vote: All ayes. Motion carried. Motion by Nawrocki, second by Ericson, to adopt Resolution 2004-51, being a resolution approving a lot split of the property at 1813 40th Avenue NE/4041 Hayes St. NE, subject to the following conditions of approval that are deemed necessary to protect the public interest and ensure compliance with the provisions of the Zoning Ordinance: 1. The applicant shall provide required utility and drainage easements for all newly created lots and be responsible for the cost of filing and recording written easements with the Anoka County Recorder's Office. 2. Upon approval of a minor subdivision, the applicant shall be responsible for filing the subdivision survey with the Anoka County Recorder's Office. The minor subdivision shall become invalid if not filed with the Anoka County Recorder within one (1) year of the date of the City Council action. Nawrocki questioned the wording for utility easements. Berkelhamer stated this is standard wording. Hoeft stated there is a standard utility and drainage easement required for any new lot. Upon vote: Kelzenberg, aye; Williams, aye; Ericson, aye; Nawrocki, aye; Wyckoff, aye. All ayes. Motion carried. RESOLUTION NO. 2004-51 SUBDIVISION REQUEST I, Gladys Wychor, hereby request a split of PIN 36-30-24-42-0112 Legally described as: That part of Lot 4, Block 17, Auditor's Subdivision of Walton's 2nd Subdivision, Anoka County, Minnesota, lying southerly of the north 180.00 feet thereof. Together with: The easterly 10.00 feet of Lot 6, Block 17, Auditor's Subdivision ofWalton's 2nd Subdivision, Anoka County, Minnesota, except the north 210.00 feet thereof. Also together with: The west 70.00 feet of Lot 7, Block 17, Auditor's Subdivision ofWalton's 2nd Subdivision, Anoka County, Minnesota. PIN 36-30-24-42-0014 Legally described as: The south 60.00 feet front and rear of the north 240.00 feet, front and rear of Lot 5, Block 17, Auditor's Subdivision of Walton's 2nd Subdivision, Anoka County, Minnesota. THE DESCRIPTIONS HENCEFORTH TO BE: PIN 36-30-24-42-0112 Legally described as: That part of Lot 4, Block 17, Auditor's Subdivision of Walton's 2nd Subdivision, Anoka County, Minnesota, lying southerly of the north 240.00 feet, as measured along the east and west lines thereof. Together with: The easterly 10.00 feet of Lot 6, Block 17, Auditor's Subdivision of Walton's 2nd Subdivision, Anoka County, Minnesota, except the north 210.00 feet thereof. Also together with: The west 70.00 feet of Lot 7, Block 17, Auditor's Subdivision ofWalton's 2nd Subdivision, Anoka County, Minnesota. PIN 36-30-24-42-0014 Legally described as: The south 60.00 feet of the north 240.00 feet, as measured along the east and west lines of Lot 4 and 5, Block 17, Auditor's Subdivision ofWalton's 2nd Subdivision, Anoka County, Mhmesota. Be it further resolved that special assessments of record in the office of the City of Columbia Heights as of this day, against the above described property, are paid. Any pending or future assessments will be levied according to the new split as approved this day. Any lot split given approval shall become invalid if the resolution, motion or other Council action approving the said lot split is not filed with the County Recorder within one (1) year of the date of the Council action. City Council Minutes September 27, 2004 Page 14 of 21 b) Resolution 2004-52, being a Lot Split Case #2004-0902, 1226 43rd Avenue NE Berkelhmrter indicated this application is from Laurie Karnes, KEL Holding Company, requesting the split of one lot into tba'ee lots. The two additional lots would be created for a zero lot line twin home. Berkelhamer indicated that the lot split meets all requirements. Homes on this block are set back further than the zoning ordinance requirement, so any new construction would have to be set back the average of other homes on the block. The Planning and Zoning Commission (P&Z) voted 4 ayes and 1 nay to recommend approval subject to conditions, and with park dedication fees of $2,195 per lot required. Berkelhamer indicated that if there were bad soils on the property it would be the responsibility of the owner to correct them at the time of building penrtit application. She stated that Laurie Karnes was present to answer questions. Wyckoff referred to the question from the P&Z meeting regarding lack of green space. Berkelhamer stated that for lots of 6,500 sq. ft. or greater, you may cover 30 percent of the property with buildings. These lots, with single family homes, meets those requirements. The twin home is considered as a whole building. Based on the conceptual plan, they propose to maximize what is allowed. Ericson questioned if payment of the park dedication fee is a risk that the applicant takes if the property is not buildable. Berkelhamer stated that park dedication fees have to be paid at the time of the building permit application. Williams indicated that a twin home would not fit into this neighborhood, and even though it meets our code, it is wrong. Discussion included preference for a single fmuily home, having the soil tested prior to lot split approval, and tabling the request. Laurie Karnes indicated that soil problems would be her responsibility to correct. Nawrocki asked the City Planner if the minimum set back applies to commercial structures. Berkelhamer stated it only applies to residential. Nawrocki did not agree with approving a lot split where the soil condition is questionable, and chancing that the building become abandoned. Berkelhamer stated this request meets the requirements for lot splits. Soils can be corrected, at some expense, but it is not an issue that affects the lot split. Ericson agreed there are probably serious soil conditions and staff can be directed to be diligent with the building application. She stated that if Council does not like the townhome policy, it needs to be addressed, but can not affect the lot split. Wyckoff questioned the history of the lot. Berkelhamer stated these were originally two separate lots that were combined, as one was a tax forfeit parcel. Hoeft stated that any lot has value, and if not buildable it would be valuable to deed to the adjoining properties. Wyckoff questioned if the penrtit for a twin home could be denied. Hoeft stated it would receive the regular scrutiny and would be dealt with in the building permit process. Karnes indicated that a duplex would also be allowed on the lot, but that would require one unit to be rental, so she was opting for the twin home where both units would be owner occupied. David Behun, 1209 43rd Avenue, gave the history of properties in this area, with soil core samples going 60 feet without hitting buildable ground. The property was tax forfeit City Council Minutes September 27, 2004 Page 15 of 21 because it was not buildable. He disagreed with the lot split as this area only contains single family homes and the land was deemed unbuildable in the past. Wyckoff asked if Council could require soil borings. Hoeft stated that approval of the lot split couldn't require soil borings Ron Reichenberger, 1208 43rd Avenue, stated this area was an old roofing dumPwith a swamg behind it. There are neighbors that do not want a twin home in the area, whether the soil is suitable or not. He suggested only allowing a split into two lots. Ann Reimer, 1214 43rd Avenue, stated she lives right next to this lot and objections to the proposed large dwelling as it would take away too much green space. The soil here is sinking, as is her garage. It would add a burden to an all ready busy road. Reimer indicated that she has called the Pollution Control Agency to be sure there are safety precaution when digging on these lots. Wyckoff asked if the 60 day rule applies. Hoeft indicated there could be a 60 day extension, but was not sure what additional items Council would look at. Wyckoff asked if our Public Works Department could do soil testing. Fehst stated no. Hoeft stated it is not our property. Ericson asked if we have any legal basis for denying this. Hoer indicated the request meets our criteria for a lot split and does not see any basis for denial. Motion by Williams to table the lot split request for 1226 43rd Avenue for 60 days. Wyckoff asked the owner if she would be willing to table this until Oct. 1 lth. Karnes indicated that whatever the soil problems may be, they are her problem to deal with. With today's technology, any property is buildable. Ericson questioned timing upon approval. Hoeft stated the lot split must be filed with Anoka County. Ericson felt the owner could withdraw the split, do the borings, then come back for the lot split, and she would not be hurt. Kames stated she was going to sell the lot to a builder and has one year to record the split. Ericson indicated she would approve the lot split, but will be hard on staff to make sure all conditions are met, and to look out for the good of the neighbors. Fehst refen'ed to hearing of a comment by staffthat there were no problems on this property, and indicated there was a note in the property file regarding bad soils, which was indicated to the owner. Karnes stated she does not hold the city responsible for what a staffperson said. Dave Ryan, 1215 4?, indicated that the Fire Department might have records of soil borings for this property. He stated that when his home was built, the basement sank out of site, so they built another basement on top of it. He had to put in pilings to build a deck. Bob Streetar, Comlxaunity Development Director, stated that the soil boring colmuent in the property files is from the property adjacent to this, showing soils were poor down to 70 feet. This information will be made available to Karnes. City Council Minutes September 27, 2004 Page 16 of 21 Nawrocki stated we should use the extension time to create an emergency ordinance. Hoeft stated it would not apply to the current application. Nawrocki stated that we should recognize the potential problems through past experience and be sure it does not happen again. Fehst stated that utility pipes in this area are on pilings. Berkelhamer indicated the application was made August 5th. Williams restated his motion, Nawrocki seconded. Ericson questioned if a lot split requires building plans. Streetar indicated it does not. Ericson stated the owner could apply for a split even if she only wanted green space and following approval could come back to request a building permit. Ryan stated that the owner would sell the land to a developer and then be gone. Deb Johnson asked if these problems would be explained to a future buyer. Hoeft stated there is due diligence to the buyer. Streetar suggested the neighbors offer to buy the lot and leave it as green space to satisfy their concern for the look of the neighborhood. Kames stated that she is a licensed realtor, and a house built on pilings can be stronger than a regular foundation. Also, the builder is liable for their work for ten years. Ericson stated that Council is shrinking from their responsibility to enforce the ordinance, by pushing aside the ordinance and going against the law. There is no basis to deny the lot split. The owner has not applied for a building permit. If she meets the conditions for a lot split, she is entitled to have it. Fehst stated that due diligence would require borings on the footprints upon a building penuit request. Hoeft stated that the ordinance could be changed to require soil compaction testing, but doubted it would be required on a split of the lot. Kames indicated soil borings would be completed on the footprint before building. Streetar stated that the Planning and Zoning Commission could direct the City Planner to review allowing twin homes throughout the City, when we get a full time planner. Kelzenberg stated he also has qualms and a twin home does not fit with this neighborhood, however, we have to follow the letter of the law. They have met every requirement for a lot split. Wyckoff suggested reviewing the utilities that are on pilings. Hoeft stated there is no relevance between the city utilities and the lot split. Kelzenberg asked the owner what she has invested in the property. She stated almost $200,000. Williams indicated the motion is not denying the lot split, just asking for a 60 day extension. Williams called for the question. Kelzenberg asked the City Attorney if we could legally call for a 60 day extension. Hoeft referred to what the need for the extension was. City Council Minutes September 27, 2004 Page 17 of 21 Berkelhamer stated the extension would be until December 5th. Ericson asked if we could require the applicant to follow through with the lot split. Hoeft indicated we could not. Streetar questioned what Council would like staff to do. Nawrocki stated he would like to see if we could change the ordinance. Streetar indicated that would apply to all properties in the city. Fehst stated the P&Z is already looking at not allowing twin homes in an R2 district. Ericson questioned if the extension would allow time to change the ordinance. Hoeft stated it would depend if the change is in lot split requirements or the zoning ordinance. The general answer is that you are not able to change requirements while a request is in process. Nawrocki requested staff find out when the property went tax delinquent. Upon vote: Kelzenberg, aye; Williams, aye; Ericson, nay; Nawrocki, aye; Wyckoff, aye. 4 ayes - 1 nay. Motion carried. Wyckoff indicated the desire for the owner and staff to work together during the upcoming 60 days. Bid Considerations 1. Adopt Resolution 2004 -61, being a resolution appropriating and designating fund balances from the Parking Ramp Fund 290 and the Sheffield Fund 410 to the Capital hnprovement Development Fund 420. Wyckoff stated this is for purchase of the Burger King property for $800,000. Streetar this Resolution would loan funds to the Economic Development Authority (EDA) to purchase the property. This is similar to the acquisition of the NEI property. It would transfer $530,000 from the parking fund and $270,000 from the Sheffield fund to fund 420 to pay for the land, building, and relocation. Burger King is willing to forgo the $300,000 relocation fees they are eligible for. When the EDA buys the property there would be no cost for demolition. Streetar indicated this was determined by City Council as a redevelopment priority and the theater owner has expressed interest in expansion of the theater and a possible dining area. Staffwill meet with the owner. Streetar indicated that the loan would be paid back with four percent interest within 15 years. Nawrocki questioned the Sheffield funds. Streetar stated there would be $200,000 to 250,000 left to cover the debt. Nawrocki felt that we do not pay off the debt to continue drawing as much tax increment as we can, and stated it would be more prudent to pay offthe debt. Nawrocki questioned the value of the equipment being $200,000. The company doing the salvage at the NEI site offered $500 for the same equipment. Streetar indicated that would be the salvage value only. Streetar indicated that Burger King is willing to sell the property and contents at a $300,000 savings. Williams stated his opposition, as he feels we are paying too much and sending the wrong message to our residents by increasing taxes 20 percent and using our fund balances to purchase property. Ericson asked if we should take a wait and see approach if it sells or if not if they lower the price. Streetar stated they could have leased the building to a fly by night restaurant. We have City Council Minutes September 27, 2004 Page 18 of 21 to follow the statutes and if we condelrmed the property we would pay AFF&E and relocation. Williams felt we should have a developer redo the entire area. Streetar stated Council could solicit a developer and give their expectations, but the developer would ask our assistance for condemnation and clearing of the property. Streetar indicated the City purchase of the property would save two to three years time. Holding the property for a while may cause it to appreciate. Wyckoff asked if there have their been negotiations with Heights Rental. Streetar indicated that staff has not talked with the owner, but the tenants could buy the property and sell to the City, as they want to build behind the White Castle building. Ted Landwehr, 5034 7th Street, expressed concern about the city being in the real estate business, and felt private owners should determine how their properties are used. The city's role is to be sure the properties are maintained. Streetar stated that if the City chooses not to purchase this property, the company could request a tax reduction from the County and they would be successful. Motion by Kelzenberg, second by Ericson, to waive the reading of Resolution 2004-61, there being an ample amount of copies available to the public. All ayes Motion carried. Motion by Kelzenberg, second by Ericson, to adopt Resolution 2004-61, a Resolution appropriating and designating fund balances from the Parking Ramp Fund 290 and the Sheffield Fund 410 to the Capital Improvement Development Fund 420. Upon vote: Kelzenberg, aye; Williams, nay; Ericson, aye; Nawrocki, nay; Wyckoff, aye. 3 ayes - 2nays. Motion carried. RESOLUTION 2004 - 61 BEING A RESOLUTION APPROPRIATING AND DESIGNATING FUND BALANCES FROM THE PARKING RAMP FUND 290 AND THE SHEFFIELD FUND 410 TO THE CAPITAL IMPROVEMENT DEVELOPMENT FUND 420. WHEREAS, the City of Columbia Heights has accumulated fund balances in the Parking Ramp Fund 290, and the Sheffield Fund 410 for the purpose of funding future redevelopment projects in the City and, WHEREAS, these funds would be more appropriately accounted for in a separate fund designated for the purpose in which these funds were accumulated and, WHEREAS, the City has established the area of 39th and Central Avenue, that includes the Burger King property, a high redevelopment priority in Columbia Heights. NOW, THEREFORE, BE IT RESOLVED that the following transfers be made and appropriated for the acquisition of the Burger King property. Transfer from the following funds: 290 Parking Ramp Fund 410 Sheffield Fund Total Transfers out: Transfers to the following funds: 420 Capital Improvement Development $530,000 $270,000 $800,000 $800,000 2. Adopt Resolution 2004-60, Inter-Fund Loan for acquisition of property at 3939 Central Avenue (Burger King) Streetar read the agreement wording and stated that the tenrts are the same as they were for the NEI property. Nawrocki questioned what would happen if the EDA would not pay the City Council back. Streetar indicated that the majority of the EDA members are the City Council. City Council Minutes September 27, 2004 Page 19 of 21 Landwehr stated that the City can find $600,00 to purchase NEI and $800,000 to purchase Burger King, but can not stop raising taxes. Motion by Kelzenberg, second by Ericson, to waive the Reading of Resolution 2004-60, there being an ample mnount of copies available to. the public. Upon vote: All ayes. Motion carried. Motion by Kelzenberg, second by Ericson, to adopt Resolution 2004-60, a Resolution approving and specifying terms of inter-fund loan for acquisition of the Burger King property. Ericson stated that we could continue to be the second lowest taxed co~mnunity, or do things to improve our cormnunity. Wyckoff stated that we are looking at long-term improvement for our city and the potential for more tax dollars. Nawrocki related Columbia Heights position in the tax statistics. Fehst referred to loss of State Aid, and the level of service homeowners expect. Fehst indicated this block was given one of the highest priorities for redevelopment. Willimns referred to financial pressures on our residents. Fehst stated that taxes on a $170,000 home would increase $10 a month. Wyckoff referred to the need for more police officers and things that should have been done before the City was in this financial situation. Landwehr indicated that the City could delay these choices. Nawrocki referred to projects completed in the past. He indicated to keep in mind that residents are also paying for street assessments. Financing of Parkview Villa was discussed. Wyckoff referred to the aluminum building on Central Avenue and the building with the fake balcony that is falling down, and stated that we need to invest in ourselves for the future. Upon vote: Kelzenberg, aye; Williams, nay; Ericson, aye; Na;vrocki, nay; Wyckoff, aye. 3 ayes - 2 nays. Motion carried. RESOLUTION 2004-60 RESOLUTION APPROVING AND SPECIFYING TERMS OF INTER-FUND LOAN FOR PURCHASE OF NATH (BURGER KING) PROPERTY RECITALS A. The City of Columbia Heights. ("City") and its Economic Development Authority ("Authority") have undertaken a program to promote the development and redevelopment of land which is underutilized within the City, and in this connection the Authority administers the Redevelopment Project No. 1 ("Project") pursuant to Minnesota Statutes, Sections 469.001 to 469.047 and Sections 469.090 to 469.1081 (the "Act"). B. Pursuant to the Act, the Authority is authorized to acquire real property for development and redevelopment by private enterprise or public use. C. The Authority proposes to acquire the Burger King property located in the Project at 3939 Central Avenue NE (the "Property"). D. The Authority and City may establish a tax increment f'mancing district ("TIF District") under Mi~mesota Statues, Sections 469.174 to 469.176, the ("TIF Act) that includes the Property in order to facilitate development of that property; or the Authority and City may develop the property for various public uses. E. Under Section 469.178, Subdivision 7 of the TIF Act, the City is authorized to advance or loan money from any fund from which such advances may be legally made in order to f'mance expenditures that are eligible to be paid with tax increments under the TIF Act. F. The City has determined that it is in the best interests of the City to loan funds to the EDA in order to acquire the Property, which loan may be repaid from tax increments or other sources, all as further described in this City Council Minutes September 27, 2004 Page 20 of 21 resolution. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Columbia Heights as follows: 1. The City authorizes a loan to the Authority in the maximmn amount of $800,000 (the "Loan"), to be drawn from the Capital Improvement Development Fund 420 for such purposes. Such amount will be made available to the Authority at or before the closing on acquisition of the Property by the Authority. 2. The outstanding principal balance of the Loan bears interest at the rate of 4.0 percent per annum. Interest accrues from the date of disbursement from the identified funds in order to acquire the Property. 3. The Loan is payable from tax increments generated from a TIF District to be created (if any), from any other tax increments legally available for such purposes, from proceeds of the sale of the Property (if any), and from any other revenues available to the Authority. Principal and interest ("Payments") shall be made at the times any revenue sources are available to make installment payments. The outstanding balance of principal and interest is due on the later of 15 years after the date of the first disbursement, or the date of last receipt of tax increment from the TIF District (if created). Payments will be credited to the respective fund from which the Loan was drawn. All payments shall be applied first to accrued interest, and then to unpaid principal of tlie Loan. 4. The principal sum and all accrued interest payable under the Loan are pre-payable in whole or in part at any time by the Authority without premium or penalty. 5. To the extent the Loan is paid with tax increment, the Loan is evidence of an interfund loan in accordance with Minnesota Statutes, Section 469.178, subd. 7, and is a limited obligation payable solely from the revenues pledged to the payment hereof under this resolution. This Loan and the interest hereon shall not be deemed to constitute a general obligation of the State of Minnesota or any political subdivision thereof, including, without limitation, the Authority. Neither the State of Minnesota, nor any political subdivision thereof shall be obligated to pay the principal of or interest on this Loan or other costs incident hereto except out of the pledged revenues, and neither the full faith and credit nor the taxing power of the State of Minnesota or any political subdivision thereof is pledged to the payment of the principal of or interest on the Loan or other costs incident hereto. 6. If the Property acquired with proceeds of the Loan is used for a purpose that is a prohibited expenditure of tax increment under the TIF Act (including without limitation a building to be used primarily for conducting the business of the City, a public or private facility used for social or recreational purposes, or a public facility used for conference purposes), then the Authority may not make any payments on the Loan from tax increments. If the Property is used for any public facility, the City and Authority will mutually determine how and whether the Loan is to be repaid. 7. The City may amend the terms of this Loan at any time by resolution of the City Council, including a determination to forgive the outstanding principal an~ount and accrued interest to the extent permissible under law. 8. The City Council authorizes and directs staff to take all actions and execute any collateral documents necessary to carry out the intent of this resolution. Other Business -none ADMINISTRATIVE REPORTS Report of the City Manager - nothing to report Report of the City Attorney - nothing to report CITIZENS FORUM Harold Hoium, 5th Street, refen'ed to damage to his property and harassment of residents. Landwehi' asked to receive the information showing where the City of Columbia Heights taxes fall in relation to other cities. Joyce Meier asked that Citizen Forum be moved up on the agenda. Wyckoff stated that another option would be to hold the Citizens Forum separately. COUNCIL CORNER Kelzenberg - nothing to report Willimns City Council Minutes September 27, 2004 Page 21 of 21 Check on an unlicensed vehicle parked at 4232 Madison. Comments from residents are 2 to 1 to not increase taxes. Pray for the health and peace of our City. Wyckoff Receiving more complaints than ever on housing issues. We need to continue with abatement, and pursue a Truth In Housing code. Ed Carlson, local businessman, has retired. He serves on our Traffic Cormnission. Wednesday with the Mayor on October 6th will feature a Meet the Candidates session beginning at 6:30 p.m. Ericson Crestview Gala will be October 8th. Contact Janet at Crest View for details. Town meeting for the school referendum Vote Yes Colmuittee on October 14th at 7:00 p.m. at the Family Center. · High school football gaines are now broadcast on cable TV Rising to New Heights will again sponsor "Make a Difference Day" on October 23''d. This is the 13th year and encourages individual to do community projects. Participation forms are available from Ted Landwehr and at City Hall. City employees will do a project and wish to issue a challenge to others, such as the Sister Cities Cormnittee, or the Women of Today. Nawrocki All candidates may not be at the candidate's session. There needs to be an impartial moderator. Wyckoff indicated this was to be an informal, social event. 104/106 Gould - a duplex owned by the Salvation Army: there have been no permits issued, but understand it is Transitional Housing. Fehst stated people are there on a day-to-day basis, with an average stay of one year. Questioned who approved the reconmaended motion and alternate motion for the tax levy at the last lneeting. This was not the consensus at the work session and asked how it relayed into an additional five percent tax increase. Wyckoffreferred to a May memo from the Finance Director. Fehst stated that staff's recolmnendation did not change. Questioned status of the garbage hauler contract. Fehst stated this would come forward within the next month. Jean Kuehn, Special Projects Coordinator, has put together a comparison of the two companies. We will save substantially more than initially recolmnended. ADJOURNMENT Mayor Wyckoff adjourned the meeting at 12:41 a.m. ( Patricia Muscovitz, CMC ~ Deputy City Clerk/Council Secretary