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HomeMy WebLinkAboutEDA MIN 12-11-00 SpecialCOLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA) SPECIAL MEETING MINUTES OF DECEMBER 11, :2000 CALL TO ORDER - The Special Meeting of the Columbia Heights Economic Development Authority (EDA) was called to order by President Ruettimann at 6:45 p.m., Monday, December 11, 2000, in Conference Room 1, City Hall, 590 40°" Avenue NE, Columbia Heights, Minnesota. ROLL CALL Commission Members Present: Commission Members Late: S~aff Present: Robert Ruettimann, Patricia Jindra, Marlaine Szurek, Gary Peterson, Julienne Wyckoff, Don Jolly and John Hunter Marlaine Szurek Walt Fehst, Executive Director Ken Anderson, Deputy Executive Director Randy Schumacher, Community Development Assistant Shirley Barnes, CEO, Crest View Corporation. ADDITIONS/DELETIONS TO MEETING AGENDA - NONE. REPORT OF THE MANAGEMENT COMPANY - Shirley Barnes, CEO, Crest View Corporation. Shirley Barnes presented the report in the absence of Anita Kottsick. She did not go over all of the details from Anita's report but touched on the most important areas. She stated that there are some heating zone belts that were scheduled for repair on the 62 of the month, and had to be moved out to the 12~ of December. The units involved currently have sufficient heat even without these parts, so she felt this was not a health and safety issue. She reported on a concern with unit 106. The reside~t has died and the family has sent management a notice to vacate the unit. That tenant had resided in that unit since 1978 and at that time other apartments were converted to handicapped units. The tenant at that time chose not to have her apartment converted. Also unit 103 has not been changed to handicapped accessible. Shirley felt that this would be a good time to bring both units up to handicapped standards. This would consist of new cabinets in the kitchen, the bathroom would have a new shower, (currently it is a tub with a step in shower), new carpet for the living room and bedroom, new vinyl in the kitchen area and entry way, electrical work to upgrade outlets, adding lighting to the unit, adding new appliances, and adapting the closet shelving. Bill Gault is working on getting quotes for all of this work. Bill's is estimating between $8 and $10,000. In closing, Shirley commented that the Park'view Villa residents Christmas Party went very well. In discussion, Hunter questioned where the funds to fix up Unit 106 would come from? Mr. Anderson reported that we would possibly use Capital Grant funds. Ruettimann asked that Shirley get separate estimates for both unit 106 and 103. Mr. Hunter questioned if we had to have a certain number of handicapped units in the apartment complex? Mr. Anderson responded that he did not believe that there was any designation. CITIZEN FORUM TO ADDRESS EDA ON MATFERS NOT ON AGENDA - NONE. RECOGNITION, PROCLAMATIONS~ PRESENTATIONS, GUESTS. President Ruettimann introduced Bruce Nawrocki and Bobby Williams as the newly elected Councilmembers. PUBLIC HEARINGS 1) Consider Sale of 4150 Central Avenue N.E. to Columbia Heights Transition Block, LLC -Ken Anderson. The Public Hearing was opened by President Ruettimann and Ken Anderson gave the explanation of the sale. The property at 4150 Central Avenue N.E. is located in the Transition Block Redevelopment area of Columbia Heights. This property is needed to provide space for the 50 unit senior assisted living facility to be built as part of the Transition Block Development. Staff is asking the EDA to approve the motion to sell the property to the Columbia Heights Transition Block, LLC for development of the senior assisted living facility. Mr. Nawrocki and Mr. Williams were updated as to the status of the project by Ken Anderson and Dan Economic Development Authority Minutes December 11, 2000 Page 2 Greeusweig. Mr. Ruettimann asked if the approvals have gone to all of the associated departments for approval. Mr. Anderson stated that the contracts have all been discussed and approved by the appropriate departments and commissions. Mr. Greensweig commented that there were a couple of things to keep in mind. 1) The EDA retains the right to take the property back if the development isn't completed in accordance with the terms of the agreement, and 2) there is a time frame in which the development has to be performed. Therefore, he recommended that the EDA approve the agreement. ; MOTION by Pat Jindra, seconded by Marlaine Szurek, to close the public hearing. All Ayes. MOTION CARRIED. MOTION by John Hunter, seconded by Marlaine Szurek, to approve the private negotiated sale of property at 4150 Central Avenue N.E., PIN 35-30-24-14-0092 to the Columbia Heights Transition Block, LLC as it is in the public interest to 1) eliminate blight, 2) provide adequate, safe, and sanitary dwellings for seniors needing services, and 3) the proposed plans have been approved and are in accord with the economic development policies of the City; said approval is subject to complying with all terms in the Purchase and Redevelopment Agreement; and furthermore, to authorize the President and Executive Director to enter into an agreement for the same. All Ayes. MOTION CARRIED. ITEMS FOR CONSIDERATION A. Other Resolutions. 1) Resolution 2000-19, Resolution Approving Contract for Private Redevelopment and Issuance of $175,100 Note. - Ken Anderson. Anderson stated that this Resolution would approve the contract for private redevelopment and the issuance of a $175, I00 note issued by the EDA to the developer for the pay-as-you-go tax increment f'mancing principal amount that would be made available to the developer over a 20 year term for the 22 unit affordable rental units of this project. The contract was drawn out by our legal counsel, Dan Greensweig and because it was very lengthy Mr. Anderson did not go over the entire contract but rather, offered to answer any questions in its regards. In discussion, Ruettimann questioned underwriting the document. He felt that it should be stated in the Contract that there is no obligation to the EDA. Mr. Greensweig confkmed that he did a review of the contract and he felt that even though the contract isn't worded exactly that way, the EDA legally isn't obligated to go through with the project. Nawrocki asked who is going to come up with a check for the $175,1007 Anderson explained that the Developer will be responsible for the upfront financing in the form of a note and is in a contract that obligates the EDA to pay the developer back the principal amount with interest at 9.5%. Nawrocki then questioned how the 9.5% interest rate was determined? Ken explained that the rate will vary somewhat and that this is what the projected market rate is as of today. Nawrocki brought up that on page 10, Article 4.1, Construction of Minimal Improvements, it states that the Developer will construct the minimum improvements of the property in accordance with the Construction Plans. With that statement he could see what the developer will get out of the development, but he did not see what the City will get out of having affordable housing and he wanted to know what amount the units would be rented out for. Ruettimann explained that the EDA will not get anything as far as a dollar amount out of the townhomes. Keith Jans explained that he has submitted complete drawings and plans for approval, to HUD. Thus, the affordable units will be available in the three MHOP areas at 30% of the median or $260/month for a 2,3 or 4 bedroom unit. The other units will be $655/month for a 2bedroom, $755/month for a 3 bedroom, and Economic Development Authority Minutes December 11, 2000 Page 3 $830/month for a 4 bedroom, single family townhome. Nawrocki questioned why these amounts were not listed in the Contracts? Ken stated that they were listed as approximate amounts in the Preliminary Agreement approved by the EDA back in August or September. Nawrocki was concerned that the residents of Columbia Heights would have to pay higher taxes due to schooling for the children in the new development area. Ruettimama stated that the last he had heard from our school system is that the City was loosing money because we didn't have enough kids. Therefore, he felt that it would be a good idea bringing more kids into our schoolS. Walt stated that the last he had heard from the school district they were receiving approximately $7,000 per student in state aid. MOTION by Don/oily, seconded by Marlaine Szurek to ~alve the reading of Resolution 2000-19, there being ample copies available to the Public. In further discussion, Mr. Peterson suggested that the motion be amended to read not to exceed $175,000. MOTION by Don Iolly, seconded by Marlaine Szurek, to approve EDA Resolution 2000-19, being a Resolution Approving Contract for Private Redevelopment and Awarding the Sale of, and Providing the Form, Terms, Covenants, and directions for the Issuance of its Taxable Tax Increment Revenue notes, Series 2000, in an amount not to exceed $175,000; and furthermore, to authorize the President and Executive Director to enter into an agreement for the same. One Nay and the rest were all Ayes. MOTION CARRIED. 2) Resolution 2000-20, Resolution Approving Contract for Private Development and Issuance of $780,000 Note - Ken Anderson. Mr. Anderson explained that this Resolution is to approve the contract for private development and awarding the sale of, providing the form, terms, covenants, and direction for the issuance of its $780,000 Taxable Tax Increment Revenue Note, series 2000, for the construction of a 50 unit senior assisted living facility. The developer is the Columbia Heights Transition Block, LLC, which will develop the site and assign its authority and responsibility to an entity to be created and operated by Crest View Corporation. The note will be for 20 years and extend between 2003 and 2023 and will allow tax increment to be generated between those years. The interest rate is 11% versus the 9.5% for the affordable housing. This is due in part because the senior Assisted living facility will be a 20 year term versus 17 years for the affordable rental townhomes. Therefore, there will be a higher tax value and more increment will be generated from this project. In discussion, Nawrocki wanted it explained to him about how the Bond Issues will be distributed for both of the development facilities. Dan Greensweig explained that only one bond will be issued for the senior affordable housing units. He explained that we are dealing with 3 different entities: 1) $6,000,000 bond issue that will be FHA Insured for the senior assisted living facility, 2) $780,000 Pay-as-you-go note for the senior assisted living facility, and 3) $175,000 note for the affordable rental facility. MOTION by Gary Peterson, seconded bY John Hunter, to waive the reading of Resolution 2000-20, there being ample copies available to the public. All Ayes. MOTION CARRIED. MOTION by Gary Peterson, seconded by John Hunter, to Approve Resolution 2000-20, being a Resolution Approving the Contract for Private Development and Awarding the Sale of, and Providing the Form, Terms, Covenants, and Directions for the Issuance of its Taxable Tax Increment Revenue Notes, Series 2000, not to exceed $780,000. One Nay and the rest were Ayes. MOTION CARRIED. B. Bid Considerations 1) Approval of Proposal for Parkview Villa Software and Hardware Package - Randy Schumacher. President Ruettimann explained that Randy and City staff has been worked diligently in investigating all aspects of this software and hardware package. He felt that this is a necessary asset to our Parkview Villa Economic Development Authority Minutes December 11, 2000 Page 4 Administrators job and that the EDA Board should feel confident in approving this proposal. Ia discussion, Nawrockl asked what was the total cost of the package and how many quotes were received? Mr. Sehumacher explained that there was only one quote received by staff due to the fact that this is a unique program that will meet the requirements that HUD asks of our Public Housing Administrator. The quote for the Software was $23,309 and a total of $4,100 for the hardware. Randy stated that the most important issue of this proposal is that City staff has been doing some of the paperwork that the City pays Crest View Management to do because they have not had the proper software and hardware'to administer the programs. MOTION by Julienne Wyckoff, seconded by Pat Jindra, to award the contract/proposal for software, installation, support and training to HAB, Inc. based on their bid dated 12-1-2000 and to authorize the acquisition of all necessary hardware per the I.S. Directors letter of 12-7-2000 with all expenditures to be funded from the operating reserve account; and furthermore, to authorize the President and Executive Director to enter an agreement for the same. All Ayes. MOTION CARRIED. C. Other Business 1) Center for Energy and Environment Contract Renewal - Ken Anderson. Ruettimann explained that this is an Anoka County program that administers the loan process for cities in Anoka County. The EDA is renewing the contract with them. We pay approximately $875 to CEE for each grant/loan that they process for us. MOTION by Gary Peterson, seconded by Marlaine Szurek, to approve the Agreement for Administrative Services Between the Center for Energy and Environment and the Columbia Heights EDA (2000 CDBG and Home Improvement Program) based upon their proposal renewal dated December 11, 2000; and furthermore, to authorize the President and Executive Director to enter into an agreement for the same. All Ayes. MOTION CARRIED. 2) Master Redevelopment Plan for Downtown Columbia Heights - Walt Fehst. This is an informational piece stating that the EDA agrees with the City Council to use the "Town Square Concept~ for the Master Redevelopment Plan Booklet for Downtown Columbia Heights. President Ruettimaun expressed that we are not approving any part of the redevelopment but merely stating that we use this name for that area of Columbia Heights redevelopment. MOTION by Bob Ruettimaun, seconded by John Hunter, to accept the Town Square Concept of the Columbia Heights Downtown Master Plan to guide future redevelopment efforts with the goals of creating a positive identity for downtown Columbia Heights, strengthen ties among nearby neighborhoods, and to attract appropriate new business opportunities. All Ayes. MOTION CARRIED. ADMINISTRATIVE REPORTS A. Report of the Deputy Executive Director -NONE. B. Report Of the Executive Director -NONE. C. Committee/Other Reports-NONE. MEETINGS The next EDA meeting is scheduled for 6:30 p.m., Tuesday, January 16, 2000 in Community Room B at Parlcview Villa. Economic Development Authority Minutes December 11, 2000 Page 5 ADJOURNMENT MOTION by Gary L. Peterson, seconded by Pat Jindra, to adjourn the meeting at 6:30 p.m. MOTION CARRIED. Respectfully submitted, Cheryl Bakken Recg. rding Secretary H:\EDAminutes\12-11-2000Special Meeting. All ayes.