HomeMy WebLinkAboutEDA MIN 11-14-00 Exec. SessionCOLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
CLOSED SESSION MEETING MINUTES OF NOVEMBER 14, 2000
CALL TO ORDER - The Closed Session Meeting of the Columbia Heights Economic Development Authority (EDA) was
called to order by Vice President Jindra at 6:40 p.m., Tuesday, November 14, 2000, in Conference Room 1, City Hall, 590
40~ Avenue NE, Columbia Heights, Minnesota.
ROLL CALL
Commission Members Present:
Commission Members Absent:
Staff Present:
Patricia Jindra, Marlaine Szurek, Don Jolly, Julienne Wyckoff
Robert Ruettimann, Gary L. Peterson, John Hunter
Walt Fehst, Executive Director
Ken Anderson, Deputy Executive Director
Randy Schumacher, Community Development Assistant
This session was closed to the public due to potential Litigation per Steve Bubul of Kennedy and Graven, Chartered.
Sullivan Lake TIF District Decertification.
The Columbia Heights HRA and City of Columbia Heights created the Sullivan Lake TIF District back in 1987. For this
District the EDA/City should have collect funds until June 15, 1997. Funds were collected from Anoka County through all
of 1997 and January of 1998. Total Payments received in 1997 was approximately $97,000. The City received a letter
from the State Auditors office in regards to the overpayment to the City of Columbia Heights. The letter states that all of
the money received by the City past June of 1997 should be repaid to Anoka County. These funds have already been spent
by the City. The Tax Increment Statute says that there cannot be a remedy of repaying the Tax Increment that you
supposedly received in appropriately, because of the payment by the County that is passed the duration that is stated in the
Tax Increment Plan. The Tax Increment Plan stated that it would be whatever was the lesser of the time period, of the eight
or ten year plan. He believes that what this is saying is that the City/EDA wouldn't have to pay back these funds.
Therefore, Mr. Bubul stated the following options to the Commissioners.
Option 1 - Payback the full amount.
Option 2 - We could agree with the State Auditor and agree to pay the funds back in a three(3) year installment plan.
Option 3 - Say no we disagree. This wasn't our fault. Therefore, the City would receive a violation letter from the State
Auditors office. The City Council would have 60 days to respond to the violation letter. The City could go to an Anoka
County Litigation Court were it would most likely be decided to payback all but one month of the total funds received.
If the EDA would go to court it is likely that the county auditor and the attorney will feel the same about letting the City
payback the amount over a period of time. Mr. Bubul stated that the law says that the first place that these funds go is to
the County and they can make the judgment if the city is to pay back the taxes or not. He suggested that the best way to go
about this would be to use the 3 year plan to pay back the funds to the county. Mr. Anderson questioned what the legal fees
would be for processing? In response, Mr. Bubul stated that he felt that the amount would be relatively small because most
the paperwork has already been done. He stated that with Option 3, the approximate amount that the City would have to
payback would be $1,678. The next step that staff should do would be to respond in writing to the State Auditor in regards
to what was decided on by the Commissioners.
Ms. Eldridge of Ehlers and Associates, Inc. explained that Anoka County paid the City of Columbia Heights for a full year
in error. However, they need the money paid back to them. Shelly explained that the Court Auditors have had three other
instances similar to this case. So far they have not heard if any other city has taken this matter to court. This is the only
TIF District in Columbia Heights that is under the ten (10) year payback specifications. Therefore, all of the other TIF
Districts will not fall under this specification.
In discussion, Don Jolly asked what penalty would the City have to pay? Steve Bubul explained that it would probably
amount to approximately $1,678 that was received for the month of January. This would be handled in Anoka County
Litigation Court.
Mr. Fehst explained what was happening was that most of the cities were not paying the taxes back that they were over paid
for so, the State auditor got involved to investigate into the matter.
The Board was in agreement to taking Option 3. Bubol stated that the next step would be for City Staff to respond to the
State Auditor in letter form that the City does not intend to pay the full amount back and just see how he responds back.
The meeting was closed at 7:18 p.m. by Vice President Jindra.
Respectfully submitted,
Cheryl Bakken
Recording Secretary
H:\EDA Minutes\l 1-14-2000Closed Session