HomeMy WebLinkAboutEDA AGN 09-06-11AGENDA
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
Special Meeting
Tuesday September 6, 2011
6:30pm City Hall, Conference room 1
1. Call to Order /Roll
Gary L. Peterson, President Bobby Williams
Marlaine Szurek, Vice President Bruce Nawrocki
Tammera Diehm, Secretary /Treasurer Gerry Herringer
Donna Schmitt
2. Pledge of Allegiance
CONSENT AGENDA
3. Approve Minutes of August 1, 2011 meeting
Approve financial report and payment of bills for July 2011 on Resolution 2011 -12.
Motions
Motion: Move to waive the reading of Resolution 2011 -12, there being an ample amount of
copies available to the public.
Motion: Move to approve the minutes and adopt Resolution 2011 -12 approving payment of
bills for July 2011.
BUSINESS ITEMS
4. Review of Scattered Site Housing TIF Plan — no action
5. Allocation of funds for City's Single Family Deferred Loan Program- Resolution
2011 -13
6. Root Property investigation grant
Executive Session
7. Discuss purchase of 4641 and 4647 Tyler (Sheffield) Resolution 2011 -14
8. Adjourn
ECONOMIC DEVELOPMENT AUTHORITY (EDA)
MINUTES OF THE SPECIAL MEETING OF
AUGUST 1, 2011 IN CONFERENCE ROOM 1
The meeting was called to order at 6:30 pm by President -Gary Peterson.
Members Present: Bruce Nawrocki, Gary Peterson, Tammera Diehm, Bobby Williams, Gerry
Hettinger, Marlaine Szurek. and Donna Schmitt.
Staff Present: Walt Fehst, Scott Clark, Sheila Cartney, and Shelley Hanson.
2. PLEDGE OF ALLEGIANCE- RECITED
3. CONSENT AGENDA
1. Approve the Minutes of June 6, 2011 for the Special Meeting and Executive Session.
2. Approve the Financial Report and Payment of Bills for May and June 2011 per
Resolution 2011 -06
Questions from members:
There were no questions /comments on the Minutes or Financial Reports.
Motion by Willliams, seconded by Szurek, to waive the Reading of Resolution 2011 -06, there
being ample copies available to the public. All ayes. MOTIONPASSED.
Motion by Williams, seconded by Szurelr; to approve the minutes and to adopt Resolution
2011 -06, approving the Financial Report and payment of bills,for May and June 2011. All
ayes. MOTION PASSED.
EDA RESOLUTION 2011 -06
RESOLUTION OF THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
(EDA) APPROVING THE FINANCIAL STATEMENT FOR MAY AND JUNE 2011 AND PAYMENT
OF BILLS FOR THE MONTH OF MAY AND JUNE 2011.
WHEREAS, the Columbia Heights Economic Development Authority (EDA) is required by Minnesota
Statutes Section 469.096, Subd. 9, to prepare a detailed financial statement which shows all receipts and
disbursements, their nature, the money on hand, the purposes to which the money on hand is to be applied, the
EDA's credits and assets and its outstanding liabilities; and
WHEREAS, said Statute also requires the EDA to examine the statement and treasurer's vouchers or bills and
if correct, to approve them by resolution and enter the resolution in its records; and
WHEREAS, the financial statement for the month of May and June 2011 has been reviewed by the EDA
Commission; and
WHEREAS, the EDA has examined the financial statement and finds them to be acceptable as to both form
and accuracy; and
EDA COMMISSION MINUTES
PAGE 2
August 1, 2011
WHEREAS, the EDA Commission has other means to verify the intent of Section 469.096, Subd. 9,
including but not limited to Comprehensive Annual Financial Reports, Annual City approved Budgets, Audits
and similar documentation; and
WHEREAS, financials statements are held by the City's Finance Department in a method outlined by the
State of Minnesota's Records Retention Schedule,
NOW, THEREFORE BE IT RESOLVED by the Board of Commissioners of the Columbia I- (eights
Economic Development Authority that it has examined the referenced financial statements including the check
history, and they are found to be correct, as to form and content; and
BE IT FURTHER RESOLVED the financial statements are acknowledged and received and the check
history as presented in writing is approved for payment out of proper funds; and
BE IT FURTHER RESOLVED this resolution is made a part of the permanent records of the Columbia
Heights Economic Development Authority.
Passed this I st day of August, 201 l .
MOTION BY: Williams
SECONDED BY: SZUrek
AYES: All ayes
BUSINESS ITEMS
4. RESOLUTION 2011 -07 HRA LEVY BUDGET and RESOLUTION 2011 -08 EDA
LEVY BUDGET
Clark explained that the 2012 budget for the Community Development Department was sent to the members in
the packets. Although some of the Department's budget (fund 201) is not controlled by the EDA, traditionally
the EDA reviews and acts on this budget as a whole. The actual EDA portion of the budget is fund 204 and the
attached resolutions generate a recommendation to the City Council for levying both an EDA and a HRA levy.
The Department's operating budget is straightforward due to the size of the department and no on -going
capital and /or rolling stock requirements.
This year's budget highlights are as follows
1) The 2012 HRA levy (called a special benefits levy), which is driven by a State formula using
City's market value, has been reduced by $22,031 from $240,374 to $218,343. The EDA
maximizes the HRA levy as a budget revenue, and the aforementioned reduction is due to
market value reductions. The EDA levy has been maintained at prior year levels.
2) The reduction in the HRA levy, coupled with the EDA levy and Parkview administration
revenue, balances fund 204 expenditures. As in past years, a small transfer to fund 420,
Capital Improvement Development, is proposed.
PDA Commission Minutes
Page 3
August 1, 2011
3) Fund 201 (Protective Inspections which includes building inspections and planning) has a
proposed negative $71,541 difference between revenue and expenditures. The difference will
be made up by existing Fund 201 fund balance. The aforementioned loss is a projected worst
case scenario and one or two unanticipated projects in 2012 could substantially change these
figures. Due to the inconsistency of building inspection revenue, revenue seldom matches
expenditures. Fund 201 fund balances are used to offset years in which there are losses and the
fund is replenished in years when revenues exceeds expenditures.
4) Staff has curt back a number of line item expenses, especially in the area of professional and
expert services. If additional funds are needed, staff will come back to the BDA for
expenditures out of Fund 420, Capital Improvement Development.
5) The only major expenditure increase is for computer replacement for all members of the
Department (5). The total expenditure (Funds 201 and 204 combined) of $6,125 is consistent
with the recommendations of the City of Columbia Heights' IS Division.
Clark explained the projections could change if Phase 3 of the I -luset Park Development moves forward. He
stated that BNC is in the process of doing a market study since taking over the property from Shafer Richardson.
Questions by Members:
Nawrocki said he thinks it is premature to act on this department's budget since the Council hasn't seen the rest
of the Department Budgets. He also expressed his belief that the Council needs to look closely at the budget, just
as the State and Federal governments will be doing. The cuts they will be making could have a large impact on
future funds to local governments as well, and we need to plan accordingly. Clark responded that these budgets
still go to the City Council for final approval with the rest of the City budget, even if these Resolutions are
approved tonight.
Fehst told members that the City will receive the LGA amount that was planned on for 2011 and 2012, and
explained what changes will be made to the Market Value Homestead Credit next year. Fehst also explained that
there are no levy limits, which enables the City to stick with the five year plan in place to reduce our dependence
on LGA as part of our Revenue stream. He explained the City froze its budget for 2011 and is holding to a 1%
overall increase for 2012 in order to accomplish this.
Nawrocki stated that we have a large debt for the Liquor Stores and Public Safety Building that need to be paid
off. He believes we need to cut the budget and change the levy amounts and not necessarily stick to the five year
plan. Fehst explained that the City actually received an upgrade of two points in its credit rating due to the fact
that we established the 4 -5 year program to eliminate the need for LGA monies as a necessary component of our
budget revenues.
Nawrocki then questioned the Special Levy that Anoka County is collecting on our behalf. Clark stated that this
is not budgeted since this is a capital fund, and tonight's action is for the CDA's operational budget.
Nawrocki asked what the $37,000 amount was for in the Reimbursement account of the 204 fund. Clark stated
that was the Administration Fee for Parkview Villa.
EDA Commission Minutes
Page 4
June 6, 2011
There was a discussion regarding the 201 Fund (Protective Inspections) and how differences between Revenues
and Expenses are handled. Clark explained that the 201 Fluid is separate from the General Fund. Some years we
experience a surplus and some years we have a loss. To date, we have a surplus that should help meet the
expenses for 2011 and 2012. This fund constantly fluctuates depending oil the economy and construction
activity which dictates the type of permits issued. Fehst stated that due to law changes the funds must be kept in
the Building Inspection Fund and any surpluses cannot be transferred to the General Fund. Clark told members
that Department Staff spends a great deal of time on counter assistance, answering questions on Zoning and
Building Code issues. This customer service does not generate revenue, but is very important to ensure
construction and remodeling is done according to the Codes in place.
Nawrocki didn't feel the department needed to spend money on five new computers. Clark said the IS
Department worked up the figures for the replacement computers and they recommend replacing them as they are
outdated. The computers now used are seven years old and generally do not work well. It wastes a lot of staff
time waiting for the software to operate as it should.
Nawrocki questioned the salary increase in the 204 Fund. Clark stated that there was an adjustment to increase
the 204 fund and decrease the 201 fund to reflect a division of the License /Permit Clerk's salary due to the fact
that her duties now encompass work for both the EDA /Community Development Department and the Building
Inspection Department. Nawrocki then asked if Jeff Sargent's salary was also divided between Fire and
Protective Inspections. Clark said it was not, but as direction had been given by the EDA to be vigilant on
property inspections in order to be pro - active in maintaining neighborhoods, staff is doing its best to do just that.
Clark also stated that Sargent spends a smaller portion of his time, and only on a seasonal basis, doing outside
inspections.
Schmitt questioned telephone expenses of Funds 201 and 204 and wondered why they had increased
substantially. Clark said lie would check on that and report back, He was given the figures from the IS Dept.
Nawrocki stated he felt the cell phone policy for employees should be looked at. He doesn't believe all
employees need one. Clark stated that only the Building Inspector and Jeff Sargent have City cell phones since
they are out in the field and must be reached from time to tune. Everyone else in the Department uses a personal
cell phone.
Motion by Diehm, seconded by Schmitt, to waive the reading of Resolutions 2011 -07 there being couple copies
available to the public. All ayes. MOTION PASSED.
Motion by Diehm, seconded by Schmitt, to approve Resolution 2011 -07, Resolution Authorizing the Levy of a
Special Benefit Levy pursuant to Minnesota Statutes, Section 469.033, Subdivision 6. Roll Call: Ayes- Williams,
Herringer, Szurek, Schmitt, Diehm and Peterson.
Nays- Nawrocki MOTION PASSED.
EDA Commission Minutes
Page 5
August 1, 2011
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO. 2011-07
AUTHORIZING THE LEVY OF
A SPECIAL BENEFIT LEVY PURSUANT TO MINNESOTA STATUTES,
SECTION 469.033, SUBDIVISION 6 AND APPROVAL
OF A BUDGET FOR FISCAL YEAR 2012
WHEREAS, pursuant to Minnesota Statutes, Section 469.090 to 469.1081 ( "EDA Act ") the City of
Columbia Heights ( "City ") created the Columbia Heights Economic Development Authority (the "EDA "); and
WHEREAS, pursuant to City Resolution 2001 -62 and Ordinance No. 1442, the City Council granted
to the EDA all powers and duties of a housing and redevelopment authority under the provisions of Minnesota
Statutes, Sections 469.001 to 469.047 (the "HRA Act "), except certain powers that are allocated to the
Housing and Redevelopment Authority in and for the City of Columbia Heights (the "HRA "); and
WHEREAS, Section 469.033, Subdivision 6, of the HRA Act permits the EDA and I -IRA, together, to
levy and collect a special benefit levy of up to .0185 percent of taxable market value in the City upon all taxable
real property within the City; and
WHEREAS, the EDA desires to levy a special benefit levy in the amount of .0185 percent of taxable
market value in the City; and
WHEREAS, the EDA understands that the HRA does not expect to levy a special benefit tax for fiscal
year 2012; and
WHEREAS, the EDA has before it for its consideration a copy of a budget for its operations for the fiscal
year 2012 and the amount of the levy for collection in fiscal year 2012 shall be based on this budget.
NOW, THEREFORE, Be It Resolved by the Board of Commissioners of the Columbia Heights
Economic Development Authority:
1. The budget of $340,154 for the operations of the EDA presented for consideration by the Board
of Commissioners of the EDA is hereby in all respects approved. Such budget includes the amount the EDA
requests (by separate resolution) to be levied by the City under Minnesota Statutes, Section 469.107, together with
the amount to be levied hereunder by the EDA under Minnesota Statutes, Section 469.033, subdivision 6.
2. Staff of the EDA are hereby authorized and directed to file the budget with the City in accordance
with Minnesota Statutes, Section 469.033, Subdivision 6.
3. There is hereby levied, subject to the approval of the City Council of the City, a special benefit
levy pursuant to Minnesota Statutes, Section 469.033, Subdivision 6, in the amount equal to the lesser of a
levy at a rate of .0185 percent of taxable market value in City, or $218,343 with respect to taxes payable in
calendar year 2012.
4. Staff of the EDA are hereby authorized and directed to seek the approval by resolution of the City
Council of the City of the levy of special benefit taxes in 2012 and to take such other actions as are necessary to
levy and certify such levy.
Motion by: Diehm
Second by: Schmitt
Motion passed this 26th day of July 2011
Attest by:
Walter R. Fehst, Executive Director Gary L. Peterson, President
EDA Commission Minutes
Page 6
August 1, 2011
Motion by Diehm, seconded by Szurek, to waive the reading of Resolutions 2011 -08 there being ample copies
available to the public. All ayes. MOTIONPASSED.
Motion by Williams, seconded by Diehrn, to approve Resolution 2011 -08, Approval of a Budget for Fiscal Year
2012. Roll Call: Ayes- Williams, Herringer, Szurek, Schmitt, Diehun and Peterson.
Nays- Nawrocki MOTION PASSED.
EDA RESOLUTION 2011 -08
RESOLUTION OF TIIE ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR COLUMBIA
HEIGHTS (EDA) ADOPTING TIIE 2012 BUDGET AND SETTING THE EDA LEVY.
BE IT RESOLVED By the Columbia Heights Economic Development Authority (EDA) of Columbia Heights,
Minnesota as follows:
WHEREAS, the Columbia Heights City Council established the Columbia Heights Economic Development
Authority January 8, 1996 pursuant to Minnesota Statutes 469.090 to 469.1081; and
WHEREAS, the City Council has given to the EDA the responsibility for all development and redevelopment
projects and programs; and
WHEREAS, the EDA is authorized under State Statutes, Section 469.107 to levy a tax on its area of operation
for the purposes authorized under State Statues 469.090 to 469.108 1, subject to consent by the City Council.
NOW, THEREFORE BE IT RESOLVED BY THE EDA FOR THE CITY OF COLUMBIA
HEIGHTS, MINNESOTA THAT:
1. The EDA adopts and recommends to the City Council for approval a budget of $340,154 for year
2012.
2. The EDA adopts and recommends to the City Council for approval a levy of $ 84,811 for year 2012.
The Executive Director is instructed to transmit a copy of this resolution to the City Manager and Finance
Director /City Clerk of the City of Columbia Heights, Minnesota.
APPROVED THIS I DAY OF AUGUST 2011
MOTION BY: Williams
SECONDED BY: Diehm
Attest by:
Walter R. Fehst, Executive Director Gary L. Peterson, President
EDA Commission Minutes
Page 7
August 1, 2011
5. RESOLUTION 2011 -09 CALLING FOR A PUBLIC HEARING TO CREATE A
SCATTERED SITE HOUSING DISTRICT
At the April 28, 2009 EDA meeting, the commission directed staff to implement all the necessary processes to
create a Scattered Site Housing District. This included the use of all remaining TIF District C8 funds (fund
balance and revenue derived until the end of the District in 2010) as a revenue source and the immediate
acquisition of properties that met policy guidelines established by the EDA. To date 14 properties have been
purchased through the scattered site program, in addition the Plan's initial proposal will include seven other lots
owned by various parties.
In order to create the district, the FDA's first step is to request that the City Council call for a public hearing to
modify the Downtown CBD Revitalization Plan for the CBD Redevelopment project and the Establishment of
the City-Wide Scattered Site Housing TIP District. The EDA will have to approve the plan modification as well
in September and should consider holding a special meeting in early September to review the plan (the schedule
was included in the packet). As is the case with all of our TIF Districts Ehlers will prepare plans with the
standard fee of $10,000. The source of funds will come from the district itself.
In September we will discuss marketing and selling parameters for these lots, and have included the City of
Crystal and Richfield's programs for your information as to how other cities operate these types of programs.
With a scattered site district the first buyer must meet certain income limits (100% area median income for one
and two person and 115% of median area income for three or more persons), other than that there are not findings
that need to be met or other restrictions. The EDA could establish more restrictions as part of the program.
uestions from members
Nawrocki asked about the Scattered Site District we have in place. Clark said we don't currently have a
Scattered Site District. We previously had one that was dissolved about two years ago. Nawrocki wanted to
know what impact this might have on tax revenue if established. Clark said this Resolution is to call for a Public
Hearing, not to decide on the details of the Plan. As previously stated, Ehlers will prepare plans the Board can
consider during the meetings and Public Hearing in September.
Clark went on to explain there are currently about 20 -25 housing sites that would make up this district, which
would include properties purchased by Anoka County and GMHC as they meet the necessary requirements.
Fehst said one plan to consider would be to use the increased tax revenue to cover the expenses we have incurred
to purchase and demolish the sites and maybe to regenerate the fund so the City could continue purchasing old,
run down homes that could be rebuilt to improve neighborhoods. He said we have purchased these single family
homes at reduced rates, and once new homes are built, they will generate higher taxes than the previous ones.
Nawrocki questioned how much was left in the A3 /C8 District currently being used to purchase properties. Clark
stated there is about $340,000 left which means we could possibly purchase six more homes. By establishing a
new District, we call generate new revenue to replenish the fund.
Nawrocki thought Ehlers fee of $10,000 to establish this District might be too high. He thought the City should
go out for bids. Clark stated that there are only two companies who do this type of work and Ehlers is the more
experienced of the two, and specializes in working on TIF District issues.
Nawrocki asked what the median income was. Cartney stated it is between $80,000 - $82,000 and that it is
established by HUD taking into account the Metro average.
EDA Commission Minutes
Page 8
August 1, 2011
Schmitt asked what advantage it is to establishing a TIP District rather than selling the property outright. Clark
explained it gives us a mechanism to fund future housing programs for a period of time (up to 25 years), by
capturing a greater portion of the tax dollar. Otherwise, the money would go back to the General Fund at 40
cents on the dollar because we would lose some money to the County, School District, etc in the normal tax
process. Soto maximize our dollars to continue revitalizing neighborhoods in this way, we would want to
establish the TIF District. This would make it possible to cover what has been expended, as well as replenish the
fund. Otherwise, money would have to be appropriated in the General Fund if the City chose to continue
purchasing properties and /or doing other type of housing programs.
Motion by Williams, seconded by Szurek, to waive the reading of Resolution 2011 -09, their being ample copies
available to the public. All ayes. MOTION PASSED.
Motion by Williams, seconded by Szurek, to approve Resolution 2011 -09, a Resolution Requesting the City
Council of the City of Cohnnhia Heights call for a public hearing on the modification of the CBD redevelopment
project and the establishment of the chy-wide scattered site housing tax increment financing district (a scattered
site housing district). Roll Cali: Ayes- Williams, Herringer, Szurek, Diehm, and Peterson
Nays- Nawrocki and Schmitt MOI'IONPASSED.
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION 2011 -09
RESOLUTION REQUESTING THE CITY COUNCIL OF THE CITY OF COLUMBIA
HEIGHTS CALL FOR A PUBLIC HEARING ON THE MODIFICATION OF THE CBD
REDEVELOPMENT PROJECT AND THE ESTABLISHMENT OF THE CITY -WIDE
SCATTERED SITE HOUSING TAX INCREMENT FINANCING DISTRICT (A
SCATTERED SITE HOUSING DISTRICT).
BE IT RESOLVED, by the Board of Coin inissioners (the 'Board ") of the Columbia Heights Economic
Development Authority, Minnesota (the 'EDA ") as follows:
WHEREAS, the City Council (the "Council') of the City of Columbia Heights, Minnesota (the "City ")
established the CBD Redevelopment Project pursuant to Minnesota Statutes, Minnesota Statutes, Sections
469.174 to 469.1799, inclusive, as amended, in an effort to encourage the development and redevelopment of
certain designated areas within the City; and
WHEREAS, the EDA is proposing the modification of the CBD Redevelopment Project and the
establishment of the City -Wide Scattered Site Housing Tax Increment Financing District, pursuant to, and in
accordance with, Minnesota Statutes, Sections 469.174 to 469.1799 and Sections 469.090 through 469.1082,
inclusive, as amended;
NOW, TI IEREFORE BE IT RESOLVED by the Board as follows:
The EDA hereby requests that the Council call for a public hearing on September 26, 2011 to consider the
proposed modification of the Downtown Central Business District (CBD) Revitalization Plan for the CBD
Redevelopment Project and the proposed adoption of the TIF Plan for the City -Wide Scattered Site
Housing Tax Increment Financing District (collectively, the "Plans ") and cause notice of said public
hearing to be given as required by law.
EDA Commission Minutes
Page 9
August 1, 2011
2. The EDA directs the Executive Director to transmit copies of the Plans to the Planning Commission of the
City and requests the Planning Commission's written opinion indicating whether the proposed Plans are in
accordance with the Comprehensive Plan of the City, prior to the date of the public hearing.
3. The Executive Director of the EDA is hereby directed to submit a copy of the Plans to the Council for its
approval.
4. The EDA directs the Executive Director to transmit the Plans to the county and the school district(s) in
which the City -Wide Scattered Site Housing'rax Inclement Financing District is located not later than
August 26, 2011.
5. Staff and consultants are authorized and directed to take all steps necessary to prepare the Plan and related
documents and to undertake other actions necessary to bring the Plan before the Council.
Approved by the Board on August 1, 2011.
6. PURCHASE OF 3808 JOHNSON ST-
As part of the scattered site program staff has made all offer to purchase property at 3808 Johnson Street for
$20,000 plus closing costs. This property meets the following guidelines for acquisition that were approved by
the EDA as part of the Scattered Site program:
1) An acquisition price point of $55,000 or less
2) All homes purchased will be demolished
3) Homes acquired should fall in one of the following categories:
a. Evidence of structural failure
b. Hazardous conditions including extensive mold
c. Functional obsolescence (size of property, interior layout)
d. Extensive physical deterioration
4) Residual vacant lots shall meet existing zoning standards for purposes of rebuilding
5) Recognition that extenuating circumstances may require deviation from the above policies
The existing house is 456 square feet with one bedroom and there is a detached garage. The lot is 9,000 square
feet. The house has been completed stripped down to the shell there is no plumbing, furnace, cupboards, fixtures,
lighting etc. The Building Official has posted this property as vacant and abandoned and uninhabitable.
Fannie Mae is selling this property and we have not heard a response to our offer. The property was listed at
$16,500 and there are five parties bidding on this property. That is why staff offered $3,500 more than the listing
price as this would be a good house to have demolished due to the small size and possible structural issues. As
we have done in the past the EDA can approve this purchase with an up to amount (or $20,000) and if Fannie
Mae comes back with a counter the limit is set and staff does not have to come back to the EDA for approval.
The Anoka County land value for 2012 is $61,000.
Staff recommends purchasing the property at 3808 Johnson Street for $20,000 as part of the Scattered Site
program.
Questions from members:
Schmitt stated that as long as it is posted as an abandoned property it will have to go through all inspection
process and meet minimum standards. She doesn't think it makes sense to purchase it if someone is willing to do
so and expend funds renovating the property. If we purchase for $20,000 and demolition expenses are
approximately $18,000, the City has already expended at least $38,000 oil the property. She felt the house could
be renovated, even if it is only 456 square feet in size.
EDA Commission Minutes
Page 10
August 1, 2011
Others thought it made sense to purchase it due to the size and condition of the structure, which meets the intent
of the program. They felt it could be replaced with a newer home with more square footage that would improve
the neighborhood.
Motion by Williams, seconded by Herringer to waive the reading of Resolution 2011 -10, there being ample
copies available to the public. All ayes. MOTION PASSED.
Motion by Williams, seconded by Herringer to adopt resolution 2011 -10, approving the acquisition of 3808
Johnson Street furthermore to authorize the Mayor and City Manager to enter into an agreement for the same.
Ayes- Williams, Nawrocki, Herringer, Szaurek, Diehm, and Peterson
Nay - Schmitt MOTION PASSED.
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION 2011 -10
RESOLUTION AUTHORIZING EXECUTION OF A PURCHASE AGREEMENT
FOR CERTAIN REAL PROPERTY LOCATED AT 3808 JOHNSON STREET
NORTHEAST IN THE CITY AND ASSIGNMENT THEREOF TO THE COLUMBIA
HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
Section 1. Recitals
1.O1. The Columbia Heights Economic Development Authority (the "Authority ") administers the
Downtown CBD Redevelopment Project (the "Project') within the City, which was established under
Minnesota Statutes, Sections 469.001 to 469.047 (the "HRA Act').
1.02. The Authority has undertaken a program to acquire homes in the Project in order to address
foreclosure problems and remediate and prevent the emergence of blight.
1.03 City staff have negotiated a Real Estate Purchase Agreement with the Fannie Mae (the "Seller ") dated
as of July 25, 2011 including all related addenda and disclosures thereto (collectively, the "Purchase
Agreement'), for real property located at 3808 Johnson Street Northeast and legally described as follows:
AUDITORS SUBDIVISION OF WALTONS SUNNY ACRES THIRD ALL OF S 1/2 OF S 1/3 OF EI /2 OF
BLK 15 AUD SUB OF WALTONS SUNNY ACRES 3RD -EX E 30 FT THEREOF TAKEN FOR JOHNSON
ST NE - -EX W 149.96 FT THEREOF. (the "Property"), which Purchase Agreement is contingent upon
approval by the Economic Development Authority.
1.04. The Purchase Agreement has been prepared and submitted to this Authority and is on file with
the City Manager, and /or the Executive Director of the EDA.
Section 2. Approval and Assignment
2.01. The Purchase Agreement for the Property is hereby approved, and the execution of the
Purchase Agreement by the FDA is hereby ratified. Pursuant to the Purchase Agreement, the EDA will
purchase the Properly for $20,000. City staff and officials are authorized and directed to take all such other
actions to complete the purchase of the Property, including without limitation execution of all documents and
agreements related to such transaction.
EDA Commission Minutes
Page 11
August 1, 2011
2.02. Contingent upon approval of the Authority, the City hereby assigns its interests in the
Purchase Agreement to the Authority. City staff and officials are authorized and directed to take all such other
actions to complete the assignment of the City's interests in the Purchase Agreement to the Authority,
including without limitation execution of any documents and agreements necessary to effectuate such
assignment.
Passed this I" clay of August
Offered by: Williams
Second by: 1lerringer
Roll Call: Ayes - Williams, Nawrocki, Dielun, Herringer, Szurek, and Peterson
Nay - Schmitt
ATTEST:
Shelley Hanson, Secretary
President Gary L. Peterson
7. PURCHASE 4133 2nd STREET -
As part of the scattered site program staff has made an offer to purchase property at 4133 2nd Street for
$22,500 plus closing costs. This property meets the following guidelines for acquisition that were approved by
the EDA as part of the Scattered Site program:
1) An acquisition price point of $55,000 or less
2) All homes purchased will be demolished
3) Homes acquired should fall in one of the following categories:
a. Evidence of structural failure
b. Hazardous conditions including extensive mold
c. Functional obsolescence (size of property, interior layout)
d. Extensive physical deterioration
4) Residual vacant lots shall meet existing zoning standards for purposes of rebuilding
5) Recognition that extenuating circumstances may require deviation from the above policies
This house has been structurally compromised and is unfit for human occupancy. The existing house is 875
square feet with two bedrooms and one bathroom and there is a detached garage that is in disrepair. The lot is
6,500 square feet. The listing has it listed as "sold as is in tough shape with strong, strong pet odor. Tear down
condition. Value for lot. Make offer." As part of the purchase staff had to agree to tear down the house and not
occupy the house. The Building Official has posted this property as vacant and abandoned and uninhabitable.
The Anoka County land value for 2012 is $54,000.
Clark passed around pictures of the house so they could see the condition of the property on the interior. Staff
recommends purchasing the property at 4133 2nd Street for $22,500 as part of the Scattered Site program.
The general consensus was to purchase this property since it meets the intent of the ordinance.
EDA Commission Minutes
Page 12
August 1, 2011
Motion by Williams, seconded by Herringer to waive the reading of Resolution 2011 -11, there being ample
copies available to the public. All ayes. M077ONPASSED.
Motion by Williams, seconded by Herringer, to adopt resolution 2011 -11, approving the acquisition of 4133 2' "
Street furthermore to authorize the Mayor and City Manager to enter into an agreementfor the same. All ayes.
MOTION PASSED.
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION 2011 -11
RESOLUTION AUTHORIZING EXECUTION OF A PURCHASE AGREEMENT
FOR CERTAIN REAL PROPERTY LOCATED AT 4133 2nd STREET NORTHEAST
IN THE CITY AND ASSIGNMENT THEREOF TO THE COLUMBIA HEIGHTS
ECONOMIC DEVELOPMENT AUTHORITY
Section 1. Recitals
1.01. The Columbia Heights Economic Development Authority (the "Authority") administers the
Downtown CBD Redevelopment Project (the "Project ") within the City, which was established under
Minnesota Statutes, Sections 469.001 to 469.047 (the "HRA Act ").
1.02. The Authority has undertaken a program to acquire homes in the Project in order to address
foreclosure problems and remediate and prevent the emergence of blight.
"
1.03 City staff have negotiated a Real Estate Purchase Agreement with the Remax Results (the "Seller ")
dated as of July 25, 2011 including all related addenda and disclosures thereto (collectively, the "Purchase
Agreement "), for real property located at 4133 2nd Street Northeast and legally described as follows: THAT
PRT OF LOT 14 BLK 2 REAR OF BLK D COLUMBIA HEIGHTS ANNEX LYG SLY OF N 90 FT
THEREOF & LYG WLY OF A LINE DRAWN FROM A PT ON S LINE OF N 90 FT OF SD LOT 14 129.6
FT E OF W LINE OF SD LOT l4 TO A PTON N LINE OF LOT I I SD BLK 2 129.6 FT E OF W LINE OF
SD LOT I I SUBJ TO EASE OF REC. (the "Property"), which Purchase Agreement is contingent upon
approval by the Economic Development Authority.
1.04. The Purchase Agreement has been prepared and submitted to this Authority and is on file with
the City Manager, and /or the Executive Director of the EDA.
Section 2. Approval and Assignment
2.01. The Purchase Agreement for the Property is hereby approved, and the execution of the
Purchase Agreement by the EDA is hereby ratified. Pursuant to the Purchase Agreement, the EDA will
purchase the Property for $22,500. City staff and officials are authorized and directed to take all such other
actions to complete the purchase of the Property, including without limitation execution of all documents and
agreements related to such transaction.
2.02. Contingent upon approval of the Authority, the City hereby assigns its interests in the
Purchase Agreement to the Authority. City staff and officials are authorized and directed to take all such other
actions to complete the assignment of the City's interests in the Purchase Agreement to the Authority,
including without limitation execution of any documents and agreements necessary to effectuate such
assignment.
EDA Commissiou Minutes
Page 13
August 1, 2011
Passed this I" clay of August
Offered by: Williams
Second by: Herringer
Roll Call: All ayes
ATTEST
President Gary L. Peterson
Shelley Hanson, Secretary
8. DISCUSSION ON MEETING DATES
At the February 22` EDA meeting the commission decided to temporarily change the meeting date
and times to the first Monday of each month prior to City Council work sessions at 6:30pm. At that
meeting it was decided that after six months the commission would revisit the meeting schedule and
decide if a bylaw change would be made to formally change the meeting date to the first Monday of
the month rather than the fourth Tuesday of the month. If the commission would like to change the
meeting date to the first Monday of the month staff will prepare a bylaw amendment for the
September meeting.
The theory behind the meeting date and time change is for those EDA meetings that have a short
agenda, they can be completed by the 7:00 p.m. work session start time. If there is a need for a longer
agenda, the EDA meeting would effectively consume the first thirty minutes or so of the first part of
the work session and the work session would start immediately following the EDA meeting.
On the rare occasions where a lengthy meeting is required the EDA can always call a special
meeting. A number of cities convene their FDA or HRA commissions prior to the start of a Council
meeting, with the purpose of consolidating meeting nights.
If the EDA would like the formally change the meeting date to the first Monday of the month at
6:30pm, staff recommends making a motion to amend the bylaws.
uestions /Comments from members
Diehm said this schedule has worked well for her. Schmitt said she has a conflict since the Traffic
Commission isn't done by 6:30, so she prefers a different night.
Kevin Hansen, Public Works Director, who was in attendance, said he would poll members of the
Traffic Commission to see if they could meet at 5:30 pm rather than 6 pm. He will let everyone know.
The decision will be to either double up EDA and HRA meetings, or the EDA and work sessions. We
will address this again at the next meeting after we find out about the Traffic Commission.
EDA Commission Minutes
Page 14
August 1, 2011
9. ADMINISTRATIVE REPORTS
Citizens Academy -
Clark explained that the Citizens Academy is a program directed to staff through the November 2011
work plan. Staff is working to implement the program in January, 2012. The program is designed to
better inform citizens of Columbia Heights on the inter - workings of local government. In this
program, citizens will be able to:
• BECOME MORE INFORMED ABOUT YOUR LOCAL GOVERNMENT
• LEARN THE ROLE OF EACH DEPARTMENT IN THE CITY
o GET HANDS -ON EXPERIENCE WITH YOUR GOVERNMENT
• PARTICIPATE IN SIMULATED EXERCISES
Other cities have implemented this program and found that residents were very interested and found
it a good way to get involved. Clark said the handout for those interested in becoming a participant,
will ask them to please sign up and further information will be distributed to them. If residents have
any further questions, they may contact Jeff Sargent at (763) 706 -3673.
Questions /Comments from members:
Nawrocki asked if there is a budget for this. Clark said it would only cost about $300. There may be
some staff time to prepare information on the department and commission functions, but otherwise the
costs would be minimal for paper and refreshments. I-Ie thought the plan would be to offer this on an
annual basis and that the meetings would be 2 -3 hours in length, one night a week, for six weeks.
The 2010 Census Report-
Clark said he included the report in the agenda packets for the members to review.
Foreclosure Stats-
Clark stated there are currently 366 active foreclosures in the City. And since 2007, 544 have been
sold. He stated that staff is working on stats detailing the number of rentals we now have due to this
foreclosure situation, and the price points that properties in the City have been selling for. Those will
be distributed to members at the next meeting.
Root Property-
The City received notice on July 18, 2011 of Columbia Heights properties that went in to Tax
Forfeiture. One of those properties is the Root Property located on the southwest corner of 40 and
University Ave. Clark told members that he has sent a letter to Anoka County asking them to partner
with the City of Columbia Heights to see if DEED would consider awarding an Investigation Grant for
possible clean -up of this property.
EDA Commission Minutes
Page 15
August 1, 2011
10. OTHER BUSINESS-
37' and Central Ave -Clark reported it is moving forward and O'Reilly's may be submitting plans in
September for October meeting approvals. O'Reilly's would not accept any previous reports that had
been done on the site, and basically started over. That is the reason it has been delayed.
The backside of the Grand Central Lofts site is being cleaned up. They have re- graded the empty land,
the bituminous has been removed, and it will be re- seeded shortly. The front portion is being
maintained, but there is no further word from the owner of the site as to future development.
Motion by Williams, seconded by Diehm, to adjourn the meeting at 8:08 pm.
Respectfully submitted,
Shelley Hanson
Secretary
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Special Meeting of: September 6, 2011
AGENDA SECTION: Consent
ORIGINATING
EXECUTIVE
NO:3
DEPARTMENT: EDA
DIRECTOR
APPROVAL
ITEM: Financial Report and Payment of Bills
BY: Sheila Cartney
BY
DATE: August 30, 2011
BACKGROUND:
The Financial Report is for the months of July 2011 and Resolution 2011 -12 is attached for approval.
RECOMMENDATION:
Staff will be available to answer questions. If the report is satisfactorily complete, we recommend the
Board take affirmative action to receive the Financial Report and approve the payment of bills.
RECOMMENDED MOTION:
Move to waive the reading of Resolution 2011 -12 there being ample copies available to the public.
Move to approve Resolution 2011 -12, Resolution of the Columbia Heights Economic Development
Authority (EDA) approving the Financial Statement and Payment of Bills for the months of July 2011.
17197AW [fJIIM[ORii
EDA RESOLUTION 2011 -12
RESOLUTION OF THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
(EDA) APPROVING THE FINANCIAL STATEMENT FOR JULY 2011 AND PAYMENT OF
BILLS FOR THE MONTHS OF JULY 2011.
WHEREAS, the Columbia Heights Economic Development Authority (EDA) is required by
Minnesota Statutes Section 469.096, Subd. 9, to prepare a detailed financial statement which
shows all receipts and disbursements, their nature, the money on hand, the purposes to which
the money on hand is to be applied, the EDA's credits and assets and its outstanding liabilities;
and
WHEREAS, said Statute also requires the EDA to examine the statement and treasurer's
vouchers or bills and if correct, to approve them by resolution and enter the resolution in its
records; and
WHEREAS, the financial statement for the months of July 2011 has been reviewed by the EDA
Commission; and
WHEREAS, the EDA has examined the financial statements and finds them to be acceptable as
to both form and accuracy; and
WHEREAS, the EDA Commission has other means to verify the intent of Section 469.096,
Subd. 9, including but not limited to Comprehensive Annual Financial Reports, Annual City
approved Budgets, Audits and similar documentation; and
WHEREAS, financials statements are held by the City's Finance Department in a method
outlined by the State of Minnesota's Records Retention Schedule,
NOW, THEREFORE BE IT RESOLVED by the Board of Commissioners of the Columbia
Heights Economic Development Authority that it has examined the referenced financial
statements including the check history, and they are found to be correct, as to form and content;
and
BE IT FURTHER RESOLVED the financial statements are acknowledged and received and the
check history as presented in writing is approved for payment out of proper funds; and
BE IT FURTHER RESOLVED this resolution is made a part of the permanent records of the
Columbia Heights Economic Development Authority.
Passed this 6 th Day of September
MOTION BY:
SECONDED BY:
AYES:
Gary Peterson, President
Attest By:
Shelley Hanson, Secretary
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COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meeting of: September 6, 2011
AGENDA SECTION: Business Items
ORIGINATING
EXECUTIVE
NO:4
DEPARTMENT: EDA
DIRECTOR
APPROVAL
ITEM: Scattered Site Tax Increment Financing
BY: Scott Clark
BY
Housing District
DATE: September 1, 2011
BACKGROUND:
On April 28, 2009 the EDA took the following motion:
" Motion by Szurek, seconded by Williams to direct the staff to implement all necessary processes to
create a Scattered Site Housing District including the use of all remaining TIF District C8 Funds (find
balance and revenue derived until the end of the District in 20 10) as a revenue source and the
immediate action of properties per the policies as stated in the report dated April 24, 2009." Motion
passed 6 to 1.
This action started the process of acquiring blighted properties, the majority of which were in
foreclosure or short sale status. The goal of the EDA was to purchase these properties and then
recapitalize the originating'ITF District (C8) from both sales proceeds and tax increment (to be
created through a Scattered Site Housing District). These funds would be used for additional housing
program needs. Staff has attached a chart which illustrates the aforementioned concept.
At this meeting, the EDA will have a chance to ask questions regarding the draft TIP Plan which is a
requirement in order to create the Scattered Site TIE District. The EDA will be asked to formally act
on the Plan at their October meeting, with a public hearing to be held by the City Council on October
10, 2011.
It is also important to note that the approval of the TIF Plan is not an agreement on how to sell the
properties and at what price. There are some assumptions within the Plan but these serve as a general
guideline for various computations. In November the staff will present and have a discussion on
disposition policies.
RECOMMENDATION: To proceed with the Plan to the October EDA meeting and City Council
public hearing.
RECOMMENDED MOTION: None at this time.
EDA ACTION:
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As ofAngusl 30, 2011
Draft for Fiscal Implications
Modification to the Redevelopment Plan
for the Central Business District Redevelopment Project
and the
Tax Increment Financing Plan
for the establishment of the
City -Wide Scattered Site Housing Tax Increment Financing
District
(a housing district)
within
the Central Business District Redevelopment Project
Columbia Heights Economic Development Authority
City of Columbia Heights
Anoka County
State of Minnesota
Public Hearing: October 10, 2011
Adopted:
This document is in drafl form for distribution to the County and the School District. The TIF
Plan contains the estimatedf:scal and economic implications ofthe proposed TIF District, The
City and the EDA may make minor changes to this draft document prior to the public hearing.
M=
Prepared by: EHLERS & ASSOCIATES, INC.
3060 Centre Pointe Drive, Roseville, Minnesota 55113 -1105
651 - 697 -8500 fax: 651 - 697 -8555 www.ehlers- inc.com
Table of Contents
(for reference purposes only)
Section 1 - Modification to the Redevelopment Plan for the Central Business District
Redevelopment Project
Foreword.............................. ............................... 1 -1
Section 2 - Tax Increment Financing Plan for the City -Wide Scattered Site Housing Tax Increment
Financing District
Subsection 2 -1.
Foreword ................ ...............................
2 -1
Subsection 2 -2.
Statutory Authority ......... ...............................
2 -1
Subsection 2 -3.
Statement of Objectives .... ...............................
2 -1
Subsection 2 -4.
Redevelopment Plan Overview ..............................
2 -1
Subsection 2 -5.
Description of Property in the District and Property To Be Acquired
. 2 -2
Subsection 2 -6.
Classification of the District .. ...............................
2 -2
Subsection 2 -7.
Duration and First Year of Tax Increment of the District ...........
2 -3
Subsection 2 -8.
Original Tax Capacity, Tax Rate and Estimated Captured Net Tax
Capacity Value /Increment and Notification of Prior Planned Improvements ....
2 -4
Subsection 2 -9.
Sources of Revenue /Bonds to be Issued ......................
2 -5
Subsection 2 -10.
Uses of Funds ............ ...............................
2 -6
Subsection 2 -11.
Fiscal Disparities Election ... ...............................
2 -6
Subsection 2 -12.
Business Subsidies ........ ...............................
2 -7
Subsection 2 -13.
County Road Costs ........ ...............................
2 -8
Subsection 2 -14.
Estimated Impact on Other Taxing Jurisdictions .................
2 -8
Subsection 2 -15.
Supporting Documentation . ...............................
2 -10
Subsection 2 -16.
Definition of Tax Increment Revenues .......................
2 -10
Subsection 2 -17.
Modifications to the District . ...............................
2 -11
Subsection 2 -18.
Administrative Expenses ... ...............................
2 -11
Subsection 2 -19.
Limitation of Increment .... ...............................
2 -12
Subsection 2 -20.
Use of Tax Increment ..... ...............................
2 -13
Subsection 2 -21.
Excess Increments ....... ...............................
2 -13
Subsection 2 -22.
Requirements for Agreements with the Developer ..............
2 -14
Subsection 2 -23.
Assessment Agreements .. ...............................
2 -14
Subsection 2 -24.
Administration of the District ...............................
2 -14
Subsection 2 -25.
Annual Disclosure Requirements ...........................
2 -14
Subsection 2 -26.
Reasonable Expectations .. ...............................
2 -14
Subsection 2 -27.
Other Limitations on the Use of Tax Increment .................
2 -15
Subsection 2 -28.
Summary ............... ...............................
2 -15
Appendix A
Project Description ....................... ............................... A -1
Appendix B
Map of the Central Business District Redevelopment Project and the District ......... B -1
Appendix C
Description of Property to be Included in the District ............................ C -1
Appendix D
Estimated Cash Flow for the District ......... ............................... D -1
Appendix E
Housing Qualifications for the District ......... ............................... E -1
Appendix F
Findings for the District .................... ............................... F -2
Section 1 - Modification to the Redevelopment Plan
for the Central Business District Redevelopment Project
Foreword
The following text represents a Modification to the Redevelopment Plan for the Central Business District
Redevelopment Project. This modification represents a continuation of the goals and objectives set forth in
the Redevelopment Plan for the Central Business District Redevelopment Project. Generally, the substantive
changes include the establishment of City -Wide Scattered Site Housing Tax Increment Financing District.
For further information, a review of the Redevelopment Platt for the Central Business District Redevelopment
Project is recommended. It is available from the Community Development Director at the City of Columbia
Heights. Other relevant information is contained in the Tax Increment Financing Plans for the Tax Increment
Financing Districts located within the Central Business District Redevelopment Project.
Columbia Heights Economic Development Authority
Modification to the Redevelopment Plan for the Central Business District Redevelopment Project 7 -i
Section 2 - Tax Increment Financing Plan
for the City -Wide Scattered Site Housing Tax increment Financing District
Subsection 2 -1. Foreword
The Columbia Heights Economic Development Authority (the "EDA "), the City of Columbia Heights (the
"City "), staff and consultants have prepared the following information to expedite the establishment of the
City -Wide Scattered Site HousingTax Increment Financing District (the "District "), a housing tax increment
financing district, located in the Central Business District Redevelopment Project.
Subsection 2 -2. Statutory Authority
Within the City, there exist areas where public involvement is necessary to cause development or
redevelopment to occur. To this end, the EDA and City have certain statutory powers pursuant to Minnesota
Statutes CVS.'), Sections 469.090 to 469.1082, inclusive, as amended, and MS., Sections 469.174 to
469.1799, inclusive, as amended (the 'Tax Increment Financing Act" or "TIF Act "), to assist in financing
public costs related to this project.
This section contains the Tax Increment Financing Plan (the "TIF Plan ") for the District. Other relevant
information is contained in the Modification to the Redevelopment Plan for the Central Business District
Redevelopment Project.
Subsection 2 -3. Statement of Objectives
The District currently consists of 23 parcels of land and adjacent and internal rights -of -way. The District is
being created to facilitate the sale and redevelopment of EDA, Anoka County and Greater Metropolitan
Housing Corporation owned parcels into new single - family homes for income qualified buyers. Please see
Appendix A for further District information. The EDA has not entered into an agreement to sell any of the
properties or designated a developer to redevelop the properties at the time of preparation of this TIF Plan,
but redevelopment of some of the parcels is likely to occur in 2012. This TIF Plan is expected to achieve
many of the objectives outlined in the Redevelopment Plan for the Central Business District Redevelopment
Project.
The activities contemplated in the Modification to the Redevelopment Plan and the TIF Plan do not preclude
the undertaking of other qualified development or redevelopment activities. These activities are anticipated
to occur over the life of the Central Business District Redevelopment Project and the District.
Subsection 2 -4. Redevelopment Plan Overview
1. Property to be Acquired - The EDA or City currently owns 16 parcels of property within the
District. The retraining property located within the District may be acquired by the EDA
or City and is further described in this TIF Plan.
2. Relocation - Relocation services, to the extent required by law, are available pursuant to
MS., Chapter 117 and other relevant state and federal laws.
3. Upon approval of a developer /homcowner's plan relating to the project and completion of
the necessary legal requirements, the EDA or City may sell to a developer /homeowner
selected properties that it may acquire within the District or may lease land or facilities to
a developer /homeowner.
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -1
4. The EDA or City may perform or provide for some or all necessary acquisition , construction,
relocation, demolition, and required utilities and public street work within the District.
Subsection 2 -6. Description of Property in the District and Property To Be Acquired
The District encompasses all property and adjacent rights -of -way and abutting roadways identified by the
parcels listed in Appendix C ofthis TIF Plan. Please also see the map in Appendix F for further information
on the location of the District.
The FDA or City currently owns sixteen of the parcels within the District including interior and adjacent
street rights of way. Five of the parcels are owned by the Comity and one is owned by Greater Metropolitan
Housing Corporation. The EDA or City may acquire any parcels owned by other entities by gift, dedication,
condemnation or direct purchase in order to achieve the objectives of this TIF Plan. Such acquisitions will
be undertaken only when there is assurance of funding to finance the acquisition and related costs.
Subsection 2 -6. Classification of the District
The EDA and City, in determining the need to create a tax increment financing district in accordance with
M.S., Sections 469.174 to 469.1799, as amended, inclusive, find that the District, to be established, is a
housing district pursuant to MS., Section 469.174, Subd. 11 and MS., Section 469.1761 as defined below:
M. S., Section 469.174, Subd 11
"Housing district" means a type of tax increment financing district which consists of'a project, or a
portion of a project, intended for occupancy, in part, by persons or families of'low and moderate
income, as defned in chapter 462A, Title H of the National Housing Act of 1934, the National
Housing Act of 1959, the United States Housing Act of1937, as amended, Title VoftheHousingAct
of 1949, as amended, any other similar present or future federal, state, or municipal legislation, or
the regulations promulgated under any of those acts, and that satisfies the requirenents of MS.,
Section 469.1761. Housing project means a project, or portion of a project, that meets all the
qualifications of a housing district under this subdivision, whether or not actually established as a
housing district.
MS.. Section 469.1761:
Subd. 1. Requirement hnposed.
(a) In order for a tax increment financing district to qualify as a housing district:
(1) the income limilations provided in this section must be satisfied, and
(2) no more than 20 percent of the square footage of buildings that receive assistance front tax
increments may consist of commercial, retail, or other nonresidential uses.
(b) l he requirements imposed by this section apply to property receiving assistance financed rovith
tax increments, including interest reduction, land transfers at less than the Atdhority's cost of
acquisition, utility service or connections, roads, parking facilities, or other subsidies. The
provisions of this section do not apply to districts located within a largeted area as defined in
Section 462C.02 Subd 9, clause (e).
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -2
(c) For proposes oflhe requirements ofparagraph (a), the authority may elect to treat an addition
to an existing structure as a separate building if.'
(1) construction of the addition begins more than three years after construction of the
existing struclure was completed; and
(2) for an addition that does not meek the requirements ofparagraph (a), clause (2),if it is
treated as a separate building, the addition was not contemplated by the tax increment
financing plan which includes the existing structure.
Subd. 2. Owner occupied housing.
For owner occupied residential property, 95 percent of the housing units must be initially
purchased and occupied by individuals whose family income is less than or equal to the
income requirements for qualified mortgage bond projects under section 143(f) of the
Internal Revenue Code,
Subd. 3. Rental property.
For residential rental property, the property must satisfy the income requirements for a
qualifled residential rental project as defined in section 142(d) of the Internal Revenue
Code. The requirements of this subdivision apply for the duration of the tax ineremenl
financing district.
Subd 4. Noncompliance; enforcement.
Failure to comply with the requirements of this section is subject to MS., Section 4691771.
In meeting the statutory criteria the EDA and City rely on the following facts and findings:
The District consists of 23 parcels.
The development will consist of 23 units of single family owner occupied housing
At least 95 %ofthe houses assisted with tax increment trust be occupied with persons at 100% of median
income for a family of two or less and 115% of median income for families of three or more (rental
housing would have stricter income limitations). Median income under this provision is the greater of
the statewide median or the county median. For Anoka County, the median income is $82,700 and the
statewide median is $72,900 (year 2011). Therefore, the family of three or more could earn up to
$95,105 (115% of $82,700) and still qualify to live in the homes. (See Appendix E).
Pursuant to MS., Section 469.176, Subd. 7, the District does not contain any parcel or part of a parcel that
qualified Under the provisions of MS., Sections 273.111 or 273.112 or Chapter 473H for taxes payable in
any of the five calendar years before the filing of the request for certification of the District.
Subsection 2 -7. Duration and First Year of Tax Increment of the District
Pursuant to MS., Section 469.175, Subd. ],and Section 469.176, Subd. 1, the duration and first year of tax
increment ofthe District must be indicated within the TIF Plan. Pursuant to M.S., Section 469.176, Subd lb.,
the duration of the District will be 25 years after receipt of the first increment by the EDA or City (a total of
26 years of tax increment). The EDA or City elects to receive the first tax increment in 2015, which is no
later than four years following the year of approval of the District. Thus, it is estimated that the District,
including any modifications of the TIF Plan for subsequent phases or other changes, would terminate after
2040, or when the TIF Plan is satisfied. The EDA or City reserves the right to decertify the District prior to
the legally required date.
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -3
Subsection 2 -8. Original Tax Capacity, Tax Rate and Estimated Captured Net Tax Capacity
Value /increment and Notification of Prior Planned Improvements
PUY9uallt to MS., Scetion Subd. 7 and M S., Section 469177, Subd. 1, the Origi nal Net Tax Capacity
(ONTC) as certified for the District will be based on the market values placed on the property by the assessor
in 2011 for taxes payable 2012.
Pursuant to M.S., Section 469.177, Subds. 1 and 2, the County Auditor shall certify in each year (beginning
in the payment year 2015) the amount by which the original value has increased or decreased as a result of:
1. Change in tax exempt status of property;
2. Reduction or enlargement of the geographic boundaries of the district;
3. Change due to adjustments, negotiated or court - ordered abatements;
4. Change in the use of the property and classification;
5. Change in state law governing class rates; or
6. Change in previously issued building permits.
In any year in which the current Net Tax Capacity (NTC) value of the District declines below the ONTC, no
value will be captured and no tax increment will be payable to the EDA or City.
The original local tax rate for the District will be the local tax rate for taxes payable 2012, assuming the
request for certification is made before June 30, 2012. The ONTC and the Original Local Tax Rate for the
District appear in the table below.
Pursuant to MS, Section 469.174 Subd. 4 and MS., Section 469.177, Subd. 1, 2, and 4, the estimated
Captured Net Tax Capacity (CTC) of the District, within the Central Business District Redevelopment
Project, upon completion of the projects within the District, will animal ly approximate tax increment revenues
as shown in the table below. The EDA and City request 100 percent of the available increase in tax capacity
for repayment of its obligations and current expenditures, beginning in the tax year payable 2015. The
ProjectTax Capacity (PTC) listed is an estimate ofvalues when the projects within the District are completed.
UTA 14013I
Project Estimated Tax Capacity upon Completion (PTC)
$82,170
Original Estimated Net Tax Capacity (ONTO)
$12,522
Estimated Captured Tax Capacity (CTC)
$69,648
Original Local Tax Rate
1.25681 Pay 2011
Estimated Annual Tax Increment (CTC x Local Tax Rate)
$87,534
Percent Retained by the EDA
100%
Tax capacity includes a 3% inflation factor for the duration of the District. The tax capacity included in
this chart is the estimated tax capacity of the District in year 25. The tax capacity of the District when all
development is completed in 2018 is estimated to be $42,884.
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -4
UTA 150138
Project Estimated Tax Capacity upon Completion (PTC) $3,769
Original Estimated Net Tax Capacity (ONTC) $671
Estimated Captured Tax Capacity (CTC) $3,098
Original Local Tax Rate 1.2732 Pay 2011
Estimated Annual Tax Increment (CTC x Local Tax Rate) $3,944
P ercent Retained by t he EDA 100%
Tax capacity includes a 3% inflation factor for the duration of the District. The tax capacity included in this chart
is the estimated tax capacity of the District in year 25. The tax capacity of the District when all development in
completed in 2013 is estimated to be $1,800.
Pursuant to MS., Section 469.177, Subd. 4, the EDA shall, after a due and diligent search, accompany its
request for certification to the County Auditor or its notice of the District enlargement pursuant to MS.,
Section 469.175, Subd. 4, with a listing of all properties within the District or area of enlargement for which
building permits have been issued during the eighteen (18) months immediately preceding approval of the
TIF Plan by the municipality pursuant to MS., Section 469.175, Subd. 3. The County Auditor shall increase
the original net tax capacity of the District by the net tax capacity of improvements for which a building
permit was issued.
The City has reviewed the area to be included in the District and found that the only permits that have
been issued are for the demolition of the existing structures, which will not increase the original tax
capacity.
Subsection 2 -9. Sources of Revenue /Bonds to be Issued
The costs outlined in the Uses of Funds will be financed primarily through the annual collection of tax
increments. The EDA or City reserves the right to incur bonds or other indebtedness as a result of the TIF
Plan. As presently proposed, the projects within the District will be financed by an interfund loan. Any
refunding amounts will be deemed a budgeted cost without a formal TIF Plan Modification. This provision
does not obligate the EDA or City to incur debt. The EDA or City will issue bonds or incur other debt only
upon the determination that such action is in the best interest of the City.
The total estimated tax increment revenues for the District are shown in the table below:
SOURCES OF FUNDS TOTAL
Tax Increment $1,462,968
Interest $110,032
TOTAL $1,573,000
The EDA or City may issue bonds (as defined in the TIF Act) secured in whole or in part with tax increments
from the District in a maximum principal amount of $1,037,357. Such bonds may be in the form of pay -as-
you-go notes, revenue bonds or notes, general obligation bonds, or interfund loans. This estimate of total
bonded indebtedness is a cumulative statement of authority under this TIF Plan as of the date of approval.
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -5
Subsection 2 -10. Uses of Funds
Currently under consideration for the District is a proposal to facilitate the sale and redevelopment of EDA,
Anoka County and Greater Metropolitan Housing Corporation owned parcels into new single - family homes
for income qualified buyers. The EDA and City have determined that it will be necessary to provide
assistance to the project(s) for certain District costs as described in the use of funds below. In addition, tax
increments may be used to pay for a land write down and repayment of an interfund loan(s). The EDA has
studied the feasibility of the development or redevelopment of property in and around the District. To
facilitate the establishment and development or redevelopment of the District, this TIF Plan authorizes the
use of tax increment financing to pay for the cost of certain eligible expenses. The estimate of public costs
and uses of funds associated with the District is outlined in the following table.
USES OF TAX INCREMENT FUNDS
TOTAL
Land/Building Acquisition
$450,000
Site Improvements /Preparation
$150,000
Other Qualifying Improvements
$291,060
Administrative Costs (up to 10 %)
$146,297
PROJECT COST TOTAL
$1,037,357
Interest
JaL643
PROJECT AND INTEREST COSTS TOTAL
$1,573,000
The total project cost, including financing costs (interest) listed in the table above does not exceed the total
projected tax increments for the District as shown in Appendix D.
Estimated costs associated with the District are subject to change among categories without a modification
to this TIF Plan. The cost of all activities to be considered for tax increment financing will not exceed,
without formal modification, the budget above pursuant to the applicable statutory requirements. The EDA
may expend funds for qualified housing activities outside of the District boundaries.
Subsection 2 -11. Fiscal Disparities Election
Pursuant to MS., Section 469.177, Subd. 3, the City may elect one of two methods to calculate fiscal
disparities. If the calculations pursuant to MS., Section 469.177, Subd. 3, clause a, (outside the District) are
followed, the following method of computation shall apply:
(1) The original net tax capacity and the current net tax capacity shall be determined before the
applicalion of the fiscal disparity p ofClbapter 276A or 4731%. Where the original net
tax capacity is equal to or greater than the current net tax capacity, there is no captured net tax
capacity and no lax increment determination. Where the original net tax capacity is less than
the current net tax capacity, the difference behveen the original net tax capacity and the current
net tax capacity is the captured net fax capacity. This amount less anyportion thereofa the
authority has designated, in its tax increment financing plan, to share with the local taxing
districts is the retained captured net tax capacity of the authority.
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -6
(2) The county auditor shall exclude the retained captured net lax capacity of the authorityfr•orn the net
tax capacity of the local taxing districts in determining local taxing district lax rates. The local tax
rates so dete pined are to be extended against the retained captured net tax capacity ofthe authority
as well as the net tax capacity ofthe local taxing districts. The tae generated by the extension of the
lesser of (A) the local taxing district tax rates or (B) the original local tax rate to the retained
captured net tax capacity of the authority is the tax increment of the awhority.
The City will choose to calculate fiscal disparities by clause a. It is not anticipated that the District will
contain connnercial /industrial property. As a result, there should be no impact due to the fiscal
disparities provision on the District.
According to M.S., Section 469.177, Subd. 3:
(c) Tlae neethod of computation of lac increment applied to a district pursuant to paragraph (a) or
(b) shall remain the same for the duration of the district, except that the governing body may
elect to change its election from the method of computation in paragraph (a) to the method in
paragraph (h).
Subsection 2 -12. Business Subsidies
pursuant to M.S., Section 1162993, Subd 3, the following forms of financial assistance are not considered
a business subsidy:
(1) A business subsidy of less than $150,000;
(2) Assistance that is generally available to all businesses or to a general class of similar businesses,
such as a line of business, size, location, or similar general criteria;
(3) public improvements to buildings or lands owned by the state or local government that serve a
public purpose and do not principally benefit a single business or defined group of businesses at
the time the improvements are made;
(4) Redevelopment property polluted by contaminants as defined in MS., Section 116,1.552, Subd. 3;
(5) Assistance provided for the sole purpose of renovating old or decaying building stock or bringing
it up to code and assistance provided for designated historic preservation districts, provided that
the assistance is equal to or less than 50% of the total cost;
(6) Assistance to provide job readiness and training services if the sole purpose of the assistance is to
provide those services;
(7) Assistance for housing;
(8) Assistance for pollution control or abatement, including assistance for a tax increment financing
hazardous substance subdistrict as defined under MS., Section 469.174, Subd. 23;
(9) Assistance for energy conservation;
(10) Tax reductions resulting from conformity with federal tax law;
(11) Workers' compensation and unemployment compensation;
(12) Benefits derived from regulation;
(13) Indirect benefits derived from assistance to educational institutions;
(14) Funds from bonds allocated under chapter 474A, bonds issued to refund outstanding bonds, and
bonds issued for the benefit of an organization described in section 501 (c) (3) of the Internal
Revenue Code of 1986, as amended through December 31, 1999;
(15) Assistance for a collaboration between a Minnesota higher education institution and abusiness;
(16) Assistance for a tax increment financing soils condition district as defined wider MS., Section
469.174, Subd 19;
(17) Redevelopment when the recipient's investment in the purchase of the site and in site preparation
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -7
is 70 percent or more of the assessor's current year's estimated market value;
(18) General changes in tax increment financing law and other general tax law changes of a principally
technical nature;
(19) Federal assistance until the assistance has been repaid to, and reinvested by, the state or local
government agency;
(20) Funds from dock and wharf bonds issued by a seaway port authority;
(21) Business loans and loan guarantees of $150,000 or less;
(22) Federal loan funds provided through the United States Department of Commerce, Economic
Development Administration; and
(23) Property tax abatements granted under MS., Section 469.1813 to property that is subject to
valuation under Minnesota Rules, chapter 8100.
The EDA will coin ply with MS., Sections 116.1993 to II6.995 to the extent the tax increment assistance
under this TIF Plan does not fall under any of the above exemptions.
Subsection 2 -13. County Road Costs
Pursuant to MS., Section 469.175, Subd. ]a, the county board may require the EDA or City to pay for all or
part of the cost of county road improvements if the proposed development to be assisted by tax increment
Will, in the judgment of the county, substantially increase the use of county roads requiring construction of
road improvements or other road costs and if the road improvements are not scheduled within the next five
years under a capital improvement plan or within five years under another county plan.
If the county elects to use increments to improve county roads, it must notify the EDA or City within forty -
five days of receipt of this TIF Plan. In the opinion of the EDA and City and consultants, the proposed
development outlined in this TIF Plan will have little or no impact upon county roads, therefore the TIF Plan
was not forwarded to the county 45 days prior to the public hearing. The EDA and City are aware that the
county could claim that tax increment should be used for county roads, even after the public hearing.
Subsection 2 -14. Estimated Impact on Other Taxing Jurisdictions
The estimated impact on other taxingjurisdictions assumes that the redevelopment contemplated by the TIF
Plan would occur without the creation of the District. However, the EDA or City has determined that such
development or redevelopment would not occur "but for" tax increment financing and that, therefore, the
fiscal impact on other taxing jurisdictions is $0. The estimated fiscal impact of the District would be as
follows if the "but for" test was not met
IMPACT ON TAX BASIC
Anoka County
City of Columbia Heights
Columbia Heights ISD No. 13
2010 /Pay 2011
Total Net
Tax Capacity
265,086,108
11,744,663
16,731,669
Estimated Captured
Tax Capacity (CTC)
Upon Completion
13,193
13,193
13,193
Percent of CTC
to Entity Total
0.0050%
0.1123%
0.0789%
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -8
IMPACT ON TAX RATES - 14013I
The estimates listed above display the captured tax capacity when all construction is completed. The tax rate
used for calculations is the actual Pay 2011 rate. The total net capacity for the entities listed above are based
on actual Pay 2011 figures. The District will be certified under the actual Pay 2012 rates, which were
unavailable at the time this TIP Plan was prepared.
Pursuant to MS. Section 469.175 Subd. 2(b):
(1) Estimate of total tax increment. It is estimated that the total amount of tax increment that will be
generated over the life of the District is $1,573,000;
(2) Probable impact of the District on city provided services and ability to issue debt An impact of the
District on police protection is not expected. An increase in call load is not expected since the
program is replacing blighted single family homes with new single family homes. However, blighted
and vacant buildings are being removed and should eliminate some safety concerns. The City does
not expect that the proposed development, in and of itself, will necessitate new capital investment
in vehicles or require that the City hire additional officers.
The probable impact of the District on fire protection is not expected to be significant. The existing
homes, which will be eliminated by the new development, are vacant and blighted which poses safety
concerns. In addition, all new residential construction is required to have a smoke detector in each
bedroom, which was not required at the time the existing homes were built.
The impact of the District on public infrastructure is expected to be minimal. The development is
not expected to significantly impact any traffic movements in the area. The current infrastructure for
sanitary sewer, storm sewer and water will be able to handle the additional volume generated from
the proposed development. Based on the development plans, there are no additional costs associated
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -9
Pay 2011
Percent
Potential
Extension Rates
of Total
CTC
Taxes
Anoka County
0.372350
29.63%
12,522
4,663
City of Columbia I leights
0.618040
49.18%
12,522
7,739
Columbia Heights ISD No. 13
0.186760
14.86%
12,522
2,339
Other
0.079660
6.34%
12,522
998
Total
1.256810
100.00%
15,738
IMPACT ON TAX RATES - 15013B
Pay 2011
Percent
Potential
Extension Rates
of Total
CTC
Taxes
Anoka County
0.372350
29.25%
671
250
City of Columbia Heights
0.618040
48.54%
671
415
Columbia Heights ISD No. 13
0.186760
14.67%
671
125
Other
0.0960507
54%
671
64
Total
1.273200
100.00%
854
The estimates listed above display the captured tax capacity when all construction is completed. The tax rate
used for calculations is the actual Pay 2011 rate. The total net capacity for the entities listed above are based
on actual Pay 2011 figures. The District will be certified under the actual Pay 2012 rates, which were
unavailable at the time this TIP Plan was prepared.
Pursuant to MS. Section 469.175 Subd. 2(b):
(1) Estimate of total tax increment. It is estimated that the total amount of tax increment that will be
generated over the life of the District is $1,573,000;
(2) Probable impact of the District on city provided services and ability to issue debt An impact of the
District on police protection is not expected. An increase in call load is not expected since the
program is replacing blighted single family homes with new single family homes. However, blighted
and vacant buildings are being removed and should eliminate some safety concerns. The City does
not expect that the proposed development, in and of itself, will necessitate new capital investment
in vehicles or require that the City hire additional officers.
The probable impact of the District on fire protection is not expected to be significant. The existing
homes, which will be eliminated by the new development, are vacant and blighted which poses safety
concerns. In addition, all new residential construction is required to have a smoke detector in each
bedroom, which was not required at the time the existing homes were built.
The impact of the District on public infrastructure is expected to be minimal. The development is
not expected to significantly impact any traffic movements in the area. The current infrastructure for
sanitary sewer, storm sewer and water will be able to handle the additional volume generated from
the proposed development. Based on the development plans, there are no additional costs associated
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -9
with street maintenance, sweeping, plowing, lighting and sidewalks. Based on Metropolitan Council
guidelines, no SAC credits will be required since the City is replacing single family with single
family and increasing the use.
The probable impact of any District general obligation tax increment bonds on the ability to issue
debt for general fund purposes is expected to be minimal. It is not anticipated that there will be any
general obligation debt issued in relation to this project, therefore there will be no impact on the
City's ability to issue future debt or on the City's debt limit.
(3) Estimated amount of tax increment attributable to school district levies. It is estimated that the
amount of tax increments over the life of the District that would be attributable to school district
levies, assuming the school district's share of the total local tax rate for all taxing jurisdictions
remained the same, is $233,613;
(4) Estimated amount of tax increment attributable to county levies. It is estimated that the amount of
tax increments over the life of the District that would be attributable to county levies, assuming the
county's share of the total local tax rate for all taxingjurisdictions remained the same, is $465,811;
(5) Additional information requested by the county or school district. The City is not aware of any
standard questions in a county or school district written policy regarding tax increment districts and
impact on county or school district services. The county or school district must request additional
information pursuant to MS. Section 469,175 Subd. 2(b) within 15 days after receipt of the tax
increment financing plan.
No requests for additional information from the county or school district regarding the proposed
development for the District have been received.
Subsection 2 -15. Supporting Documentation
Pursuant to M.S. Section 469.175, Subd. I (a), clause 7 the TIF Plan must contain identification and
description of studies and analyses used to snake the findings are required in the resolution approving the
District. Following is a list of reports and studies on file atthe City that supportthe EDA and City's findings:
• Map of foreclosed property in the City;
• 2010 Census Summary;
• Housing Study.
Subsection 2 -16. Definition of Tax Increment Revenues
Pursuant to M.S., Section 469.174, Subd. 25, tax increment revenues derived from a tax increment financing
district include all of the following potential revenue sources:
1. Taxes paid by the captured net tax capacity, but excluding any excess taxes, as computed under MS.,
Section 469.177;
2. The proceeds from the sale or lease of property, tangible or intangible, to the extent the property was
purchased by the Authority with tax increments;
3. Principal and interest received on loans or other advances made by the A uthority with tax increments;
4. Interest or other investment earnings on or from tax increments;
5. Repayments or return of tax increments made to the Authority under agreements for districts for
which the request for certification was made after August 1, 1993; and
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -10
6. The market value homestead credit paid to the Authority under MS., Section 273.1384.
Subsection 2 -17. Modifications to the District
In accordance with U.S., Section 469.175, Subd. 4, any:
1. Reduction or enlargement of the geographic area of the District, if the reduction does not meet the
requirements of MS., Section 469.175, Subd. 4(e);
2. Increase in amount of bonded indebtedness to be incurred;
3. A determination to capitalize interest on debt if that determination was not a part of the original TIF
Plan;
4. Increase in the portion of the captured net tax capacity to be retained by the EDA or City;
5. Increase in the estimate of the cost of the District, including administrative expenses, that will be paid
or financed with tax increment from the District; or
6. Designation of additional property to be acquired by the EDA or City,
shall be approved upon the notice and after the discussion, public hearing and findings required for approval
of the original TIF Plan.
Pursuant to MS Section 469.175 Subd. 4(f), the geographic area of the District may be reduced, but shall not
be enlarged after five years following the date of certification of the original net tax capacity by the county
auditor. If a housing district is enlarged, the reasons and supporting facts for the determination that the
addition to the district meets the criteria of MS., Section 469.174, Subd. 11 must be documented, The
requirements of this paragraph do not apply if (1) the only modification is elimination of parcel(s) from the
District and (2) (A) the current net tax capacity of the parcel(s) eliminated from the District equals or exceeds
the net tax capacity of those parcel(s) in the District's original net tax capacity or (E) the EDA agrees that,
notwithstanding MS., Section 469.177, Subd. 1, the original nettax capacity will be reduced by no more than
the current net tax capacity of the parcel(s) eliminated from the District.
The EDA or City must notify the County Auditor of any modification to the District. Modifications to the
District in the form of a budget modification or an expansion of the boundaries will be recorded in the TIF
Plan.
Subsection 2 -18. Administrative Expenses
In accordance with MS., Section 469.174, Subd. 14, administrative expenses means all expenditures of the
EDA or City, other than:
1. Amounts paid for the purchase of land;
2. Amounts paid to contractors or others providing materials and services, including architectural and
engineering services, directly connected with the physical development of the real property in the
District;
3. Relocation benefits paid to or services provided for persons residing or businesses located in the
District; or
4. Amounts used to pay principal or interest on, fund a reserve for, or sell at a discount bonds issued
pursuant to MS., Section 469.178; or
5. Amounts used to pay other financial obligations to the extent those obligations were used to finance
costs described in clauses (1) to (3).
For districts for which the request for certification were made before August 1, 1979, or after June 30, 1982,
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -11
and before August 1, 2001, administrative expenses also include amounts paid for services provided by bond
counsel, fiscal consultants, and planning or economic development consultants. Pursuant to M.S., Section
469.176, Subd. 3, tax increment may be used to pay any authorized and documented administrative
expenses for the District up to but not to exceed 10 percent of the total estimated tax increment expenditures
authorized by the'FlF Plan or the total tax increments, as defined by MS., Section 469.174, Subd. 25, clause
(1), from the District, whichever is less.
For districts for which certification was requested after July 3l, 2001, no tax increment may be used to pay
any administrative expenses for District costs which exceed ten percent of total estimated tax increment
expenditures authorized by the TI F Plan or the total tax increments, as defined in M. S, Section 469.174, Subd.
25, clause (1), from the District, whichever is less.
Pursuant to M.S., Section 469.176, Subd. 4h, tax increments may be used to pay for the County's actual
administrative expenses incurred in connection with the District and are not subject to the percentage limits
of MS., Section 469.176, Subd. 3. The county may require payment of those expenses by February 15 of the
year following the year the expenses were incurred.
Pursuant to MS., Section 469. 177, Subd. 11, the County Treasurer shall deduct an amount (currently .36
percent) of any increment distributed to the hDA or City and the County Treasurer shall pay the amount
deducted to the State Commissioner of Management and Budget for deposit in the state general fund to be
appropriated to the State Auditor for the cost of financial reporting of tax increment financing information
and the cost of examining and auditing authorities' use of tax increment financing. This amount may be
adjusted annually by the Commissioner of Revenue.
Subsection 2 -19. Limitation of Increment
The tax increment pledged to the payment of bonds and interest thereon may be discharged and the District
maybe terminated ifsufficientfunds have been irrevocably deposited in the debt service fund or other escrow
account held in trust for all outstanding bonds to provide for the payment of the bonds at maturity or
redemption date.
Pursuant to MS., Section 469.176, Suhd. 6:
if, after four years from the date of certifcation of the original net tax capacity of the tax
increment financing district pursuant to M.S., Section 469.177, no demolition, rehabilitation
or renovation ofproperty or other site preparation, including qualified improvement of
street adjacent to a parcel but not installation of utility service including sewer or water
systems, has been commenced on a parcel located within a lax increment financing district
by the authority or by the owner ofthe parcel in accordance with the tax increment financing
plan, no additional tax increment may be taken f our that parcel and the original net tax
capacity of that parcel shall be excluded from the original net tae capacity of the tax
increment financing district. If the authority or the owner of the parcel subsequently
commences demolition, rehabilitation or renovation or other site preparation on thatparcel
including qualified improvement of a sheet adjacent to that parcel, in accordance with the
tax increment frnancingplan, the authority shall certify to the county auditor that the activity
has commenced and the county auditor shall certify the net tax capacity thereof as most
recently certified by the commissioner ofrevenue and add it to the original net tax capacity
ofthe tax incremeralfinancingdistrict. The county auditor must enforce the provisions ofthis
subdivision. The authority must submit to the county auditor evidence that the required
activity has taken place for each parcel in the district. The evidence for a parcel must be
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -12
submitted by February I ofthe fiftli year following the year in which the parcel was certified
as included in the district. For purposes of this subdivision, qualified improvements of a
street are limited to (1) construction or opening of a new street, (2) relocation of a street,
and (3) substantial reconstruction or rebuilding of an existing street.
The EDA or City or a property owner must improve parcels within the District by approximately October
2015 and report such actions to the County Auditor.
Subsection 2 -20. Use of Tax Increment
The EDA or City hereby determines that it will use 100 percent of the captured net tax capacity of taxable
property located in the District for the following purposes:
1. To pay the principal of and interest on bonds issued to finance a project;
2. to finance, or otherwise pay the cost of redevelopment of the Central Business District
Redevelopment Project pursuant to MS., Sections 469.090 to 469.1082;
3. To pay for project costs as identified in the budget set forth in the TIP Plan;
4. To finance, or otherwise pay for other purposes as provided in MS., Section 469.176, Subd. 4;
5. To pay principal and interest on any loans, advances or other payments made to or on behalf of the
EDA or City or for the benefit of the Central Business District Redevelopment Project by a
developer;
6. To finance or otherwise pay premiums and other costs for insurance or other security guaranteeing
the payment when due of principal of and interest on bonds pursuant to the TIP Plan or pursuant to
MS., Chapter 462C. MS., Sections 469.152 through 469.165, and /or MS., Sections 469.178; and
7. To accumulate or maintain a reserve securing the payment when due of the principal and interest on
the tax increment bonds or bonds issued pursuant to M.S., Chapter 462C, MS., Sections 469.152
through 469.165, and /or MS., Sections 469.178.
Revenues derived from tax increment from a housing district must be used solely to finance the cost
of bossing projects as defined in M.S., Sections 469.174, Subd. 11 and 469.1761. The cost of public
improvements directly related to the housing projects and the allocated administrative expenses of the
E DA or City may be included in the cost of a housing project.
These revenues shall not be used to circumvent any levy limitations applicable to the City nor for other
purposes prohibited by MS., Section 469.176, Subd. 4.
Subsection 2 -21. Excess Increments
Excess increments, as defined in MS., Section 469.176, Subd. 2, shall be used only to do one or more of the
following:
1. Prepay any outstanding bonds;
2. Discharge the pledge of tax increment for any outstanding bonds;
3. Pay into an escrow account dedicated to the payment of any outstanding bonds; or
4. Return the excess to the County Auditor for redistribution to the respective taxing jurisdictions in
proportion to their local tax rates.
The EDA or City must spend or return the excess increments under paragraph (c) within nine months after
the end of the year. In addition, the EDA or City may, subject to the limitations set forth herein, choose to
modify the TIP Plan in order to finance additional public costs in the Central Business District
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -13
Redevelopment Project or the District.
Subsection 2 -22. Requirements for Agreements with the Developer
The EDA or City will review any proposal for private development to determine its conformance with the
Redevelopment Plan and with applicable municipal ordinances and codes. To facilitate this effort, the
following documents may be requested for review and approval: site plats, construction, mechanical, and
electrical system drawings, landscaping plan, grading and storm drainage plan, signage system plan, and any
other drawings or narrative deemed necessary by the EDA or City to demonstrate the conformance of the
development with City plans and ordinances. The EDA or City may also use the Agreements to address other
issues related to the development.
Pursuant to M.S., Section 469.176, Subd. 5, no more than 10 percent, by acreage, of the property to be
acquired in the District as set forth in the TIF Plan shall at airy time be owned by the EDA or City as a result
of acquisition with the proceeds of bonds issued pursuant to MS., Section 469.178 to which tax increments
from property acquired is pledged, unless prior to acquisition in excess of 10 percent of the acreage, the EDA
or City concluded an agreement for the development of the property acquired and which provides recourse
for the EDA or City should the development not be completed.
Subsection 2 -23. Assessment Agreements
Pursuant to M.S., Section 469.177, Subd. 8, the EDA or City may enter into a written assessment agreement
in recordable form with the developer of property within the District which establishes a minimum market
value of the land and completed improvements for the duration of the District. The assessment agreement
shall be presented to the County Assessor who shall review the plans and specifications for the improvements
to be constructed, review the market value previously assigned to the land upon which the improvements are
to be constructed and, so long as the minimum market value contained in the assessment agreement appears,
in the judgment of the assessor, to be a reasonable estimate, the County Assessor shall also certify the
minimum market value agreement.
Subsection 2 -24. Administration of the District
Administration of the District will be handled by the Community Development Director
Subsection 2 -26. Annual Disclosure Requirements
Pursuant to M.S., Section 469.175, Subds, 5, 6, and 6b the EDA or City must undertake financial reporting
for all tax increment financing districts to the Office of the State Auditor, County Board and County Auditor
on or before August I of each year. MS., Section 469.175, Subd. 5 also provides that an annual statement
shall be published in a newspaper of general circulation in the City on or before August 15.
If the City fails to make a disclosure or submit a report containing the information required by M.S., Section
469.175 Subd. 5 and Subd. 6, the OSA will direct the County Auditor to withhold the distribution of tax
increment from the District.
Subsection 2 -26. Reasonable Expectations
As required by the TIF Act, in establishing the District, the determination has been made that the anticipated
development would not reasonably be expected to occur solely through private investment within the
reasonably foreseeable future. hi making said determination, reliance has been placed upon written
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -14
representation made by the developer to such effects and upon EDA and City staff awareness of the feasibility
of developing the project site(s) within the District.
Subsection 2 -27. Other Limitations on the Use of Tax Increment
General Limitations All revenue derived from tax increment shall be used in accordance with the TIF
Plan. The revenues shall be used to finance, or otherwise pay the cost of redevelopment of the Central
Business District Redevelopment Project pursuant to MS., Sections 469.090 to 469.1082. Tax
increments may not be used to circumvent existing levy limit law. No tax increment may be used for the
acquisition, construction, renovation, operation, or maintenance of a building to be used primarily and
regularly for conducting the business of a municipality, county, school district, or any other local unit of
government or the state or federal government. This provision does not prohibit the use of revenues
derived from tax increments for the construction or renovation of a parking structure.
2. Housiug District Exceptions to Restriction on Pooling; Five Year Limit Pursuant to MS., Section
469.1763, (1) At least 80% of the tax increment derived from the District must be expended on Public
Costs incurred within said district, and up to 20% of said tax increments may be spent on Public Costs
incurred outside of the District but within the Central Business District Redevelopment Project; provided
that in the case of a housing district, a housing project, as defined in MS., Section 469.174, Subd. 11, is
deemed to be an activity in the District, even if the expenditure occurred after five years.
Subsection 2 -28. Summary
The Columbia Heights Economic Development Authority is establishing the District to provide an impetus
for residential development and provide safe and decent life cycle housing in the City. The TIF Plan for the
District was prepared by Ehlers & Associates, Inc., 3060 Centre Pointe Drive, Roseville, Minnesota 55113-
1105, telephone (651) 697 -8500.
Columbia Heights Economic Development Authority
Tax Increment Financing Plan for City -Wide Scattered Site Housing Tax Increment Financing District 2 -15
Appendix A
Project Description
In 2009, the City's EDA directed staff to implement all the necessary processes to create a Scattered site
Housing District. This included the use of all remaining TIF District C8 funds as a revenue source for
acquisition of foreclosed properties throughout the City that met guidelines established by the EDA. The
following guidelines were used when buying property:
1. An acquisition price point of $55,000 or less
2. All homes purchased will be demolished
3. Homes acquired should fall into one of the following categories:
a. Evidence of structUral failure
b. Hazardous conditions including extensive mold
c. Functional obsolescence (size of property, interior layout)
d. Extensive physical deterioration
4. Residual vacant lots shall meet existing zoning standards for purposes of rebuilding
5. Recognition that extenuating circumstances may require deviation from the above policies
All properties that have been purchased through this program have been demolished. The TIF District is
being created to facilitate the sale and redevelopment of EDA, Anoka County and Greater Metropolitan
Housing Corporation owned parcels into new single - family homes for income qualified buyers. The EDA
and City have determined that it will be necessary to provide assistance to the project(s) for various District
costs, including a land write down and repayment of an interfund loan(s).
Appendix A -1
Appendix B
Map of the Central Business District Redevelopment Project and the District
Appendix B -1
Appendix C
Description of Property to be Included in the District
The District encompasses all property and adjacent rights -of -way and abutting roadways identified by the
parcels listed below.
Parcel Numbers
Address
Owner
35- 30 -24 -13 -0044
4235 Washington Street
City of Columbia Heights
35- 30 -24 -11 -0065
4448 Quincy Street
City of Columbia Heights
35- 30 -24 -13 -0191
4147 7 "' Street
City of Columbia Heights
35- 30 -24 -24 -0120
4110 6 1 ' Street
City of Columbia Heights
35- 30 -24 -33 -0167
3853 3"' Street
City of Columbia Heights
36- 30 -24 -12 -0064
4303 Reservoir Blvd.
City of Columbia Heights
35- 30 -24 -24 -0093
4108 7 "' Street
City of Columbia Heights
35- 30 -24 -31 -0048
4011 5 ` Street
City of Columbia Heights
35- 30 -24 -31 -0055
4039 5 "' Street
City of Columbia Heights
35- 30 -24 -21 -0044
4421 5 "' Street
City of Columbia Heights
36- 30 -24 -24 -0025
1307/09 Circle Terrace Blvd.
City of Columbia Heights
26- 30 -24 -43 -0074
4502 Washington Street
City of Columbia Heights
36- 30 -24 -33 -0076
3846 Tyler Street
City of Columbia Heights
36- 30 -24 -33 -0077
3842 Tyler Street
City of Columbia Heights
35- 30 -24 -44 -0046
3812 Jackson Street
Anoka County HRA
26- 30 -24 -34 -0160
4522 5 "' Street
Anoka County HRA
26- 30 -24 -24 -0116
4947 University Avenue
Anoka County HRA
35- 30 -24 -12 -0151
4320 Madison Sheet
Anoka County HRA
36- 30 -24 -42 -0055
3973 Hayes Street
Anoka County HRA
26- 30 -24 -31 -0089
4833 University Avenue
City of Columbia Heights
35- 30 -24 -33 -0025
3805 2 "' Street
Greater Metropolitan Housing
35- 30 -24 -41 -0086
3982 Van Buren Street
Columbia Height HRA
35- 30 -24 -23 -0089
4133 2 "" Street
City of Columbia Heights
Appendix C -1
Appendix D
Estimated Cash Flow for the District
Appendix D -1
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Appendix E
Housing Qualifications for the District
INCOME RESTRICTIONS - ADJUSTED TOR FAMILY SIZE
(OWNER- OCCUPIED HOUSING DISTRICT) -ANOKA COUNTY'
No. of Persons
100% of Median Income
115% of Median Income
1 -2 persons
$82,700
N/A
3 -4 persons
N/A
$95,105
Source: U.S. Department of Housing and Urban Development
Appendix E -t
Appendix F
Findings for the District
To be added prior to the public hearing
Appendix F -2
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Special Meeting of September 6, 2011
AGENDA SECTION: Business Items
ORIGINATING
EXECUTIVE
NO:5
DEPARTMENT: EDA
DIRECTOR
APPROVAL
ITEM: Approve funding for City's single family
2011
BY:
BY:
deferred loan program — Resolution -13
DATE:
I /
BACKGROUND:
For the past four years the EDA has administered two home improvement programs: Rehab Incentive
Program and Single Family Deferred Loan Program (SFDL), and every year a reallocation of fiords is
done by resolution to keep the programs running. In February of this year staff requested that funds be
allocated to the Rehab Incentive program and not the SFDL program. The SFDL program still had
$24,000 remaining from the previous year. The Rehab program was funded with $50,000 this year and
the SFDL was to use the remaining funds from last year.
Since the beginning of 2011 the City took over administering the programs and staff has approved five
SFDL applications in a total amount of $21,587.00 therefore the 2010 funds are running out. If the EDA
would like to continue this program an allocation of funds is necessary typically the EDA allocates
$35,000 to this program from the Capital Improvement Development Fund (420).
Single - Family Home Deferred Loan Program (SFHD)
The purpose of the Single - Family Home Deferred Loan Program (SFHD) is to provide low- interest loans to
homeowners of lower income to complete structural improvements that would help maintain the quality of
their homes and the City's housing stock. Assistance is targeted at homeowners who need to perform home
maintenance, but who may not be able to pay a monthly debt service of a conventional loan.
The SFHD would provide half of the total project costs, or up to $7,500, in a deferred loan to homeowners
making 80% of the median area income or less ($67,200). 'To qualify for the program, the homeowner
must provide matching funds for the remaining project costs. Home equity loans or an MHFA loan qualify
as matching funds. Exterior home improvements related to health and safety, code violations or energy
efficiency, such as windows, siding and roofs would be eligible.
Repayment of the loan, plus simple interest of two percent, will be required upon sale of the house or
transfer of title. The homeowner can use the proceeds from the sale of the house to pay the loan. Repaid
loans will be returned to the fiords available to finance future loans. A lien applied to the property ensures
that the loan will be repaid.
RECOMMENDATION: Staff recommends the EDA fund the SFDL program
RECOMMENDED MOTION:
MOTION: Move to waive the reading of Resolution 2011 -13 there being ample copies available to the
public.
MOTION: Move to adopt Resolution 2011 -13, a Resolution approving funding for the Single Family
Deferred Loan Program (SFDL) in the amount of $35,000 from Fund 420.
EDA ACTION:
EDA RESOLUTION NO. 2011 -13
A RESOLUTION APPROVING FUNDING FOR THE SINGLE FAMILY
DEFERRED LOAN PROGRAM ($35,000)
WHEREAS, since 2002 the Greater Metropolitan Housing Corporation (GMHC)
has provided housing consulting services for the City of Columbia Heights, and
WHEREAS, over time the majority of their service time has centered on the
City's Rehabilitation Incentive Program and the City's Deferred Loan Program process,
and
WHEREAS, in 2011 the City's Community Development Department, in order
to provide better service for the residence of the community, has taken over the duties of
providing information and implementing these programs, and
WHEREAS, this resolution seeks to authorize and provide additional fiords for
the continuation of the City's Deferred Loan Program, to be administered by the City,
NOW THEREFORE BE IT RESOLVED
THEREFORE, BE IT RESOLVED, that the EDA allocates $35,000 for the Single
Family Deferred Loan (SFDL) Program from Fund 420 — Capital Improvement
Development Fund.
Passed this 6 °i Day of September
President, Gary Peterson
Walter Fehst, Executive Director
COLUMBIA HEIGI -ITS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meeting of: September 6, 2011
AGENDA SECTION: Business Items
ORIGINATING
EXECUTIVE
NO:6
DEPARTMENT: EDA
DIRECTOR
APPROVA
ITEM: Root Property -3930 University Ave. —
BY: Scott Clark
BY:
DEED Investigation Grants
DATE: September 1, 2011
BACKGROUND: On July 18, 2011 the City of Columbia Heights received official notification
from Anoka County that the Root Property, 3930 University Ave. (map enclosed) was taken into a
State Trust as a tax forfeiture parcel. Based on State law, the County becomes the manager of the
property and eventually handles the disposition of the parcel. It is obvious that this is an unusual
property due to the potential levels of site contamination issues, and it is doubtful that the property
could be sold at auction and put back into productivity. Therefore, staff is making a series of
recommendations to the EDA to assist in the long term process of cleaning this property and to
establish this as a redevelopment site (identified as a redevelopment "Area of Opportunity" within the
City's Comprehensive Plan, August 2010 -page 20, Figure 2 -3).
This site has been problematic for the City for a number of years. This includes a series of abatements
of the property for general clean -up, removal of mercury containers in October of 2007 and demolition
and contaminated ash removal from a fire in 2010. It should be noted that the tax forfeiture process
eliminates the existing abatement assessments against the property, but once the property is sold to the
private market the City can reassess. The last action to note was that the City sponsored a Department
of Employment and Economic Development (DEED) grant for the property owners in 2009, but those
owners failed to act on the grant due to their inability to provide the required matching equity.
All of this history leaves the City in a position to be the agent of change, since Anoka County is
merely a property manager of the site and have no driving reason to remedy the issues at hand. Based
on this staff is recommending the following:
1) The EDA (City) should apply for an investigation clean -up grant from DEED similar to
the one secured in 2009. Although the City does not own the property, DEED will
allow us to apply directly based on consent of the County. In turn, staff has had
discussions with the County who stated that they would allow, based on their approval
process, consent to the grant and allow access to the property for investigation.
Completion of these actions will position the City to apply for the next series of grants
which are for the actual brownfield clean -up funds. The initial investigation grant has a
25% equity participation match so if the EDA desires to proceed, a motion to obligate
these funds will be necessary. In addition to this grant, it is assumed that the City/EDA
will continue on with a general clean -up grant which could be significant in cost. Based
on this, staff is recommending that $50,000 in Anoka County Levy money be
appropriated to a Root property fund. This appropriation would have to be acted on by
the Council and actual expenditure blocks would have to be acted on by the EDA, so
this is not a blanket request for expenditure authorization up to the $50,000.
2) The second part of this grant is to secure an environmental consultant that will both
assist in the grant application and to do the actual work, if the grant is funded.
The quotes that were received are as follows:
Pro Source - range of $32,790 to $42,620
American Engineering Testing- $24,225
Bay West - $31,623.50
Since these bids were received late Thursday a recommendation will be at the meeting by staff in
order for the Community Development Department to confer with the City Engineer. If the grant is
successful staff will work with the County and DEED to move to the next step in the process which
will be grants for actual clean -up.
RECOMMENDATION: Staff recommends that the EDA apply for an investigation grant, appropriate
$50,000 for a Root property clean -up fund through the Anoka County Levy funds (and authorizing an
actual expenditure of $10,000 for the investigation phase) and enter into an agreement with Anoka
County allowing the grant to commence, and entering into a service agreement with an environmental
firm for the initial work.
RECOMMENDED MOTION:
Motion: Move to direct staff to initiate and complete the following:
1) Take all actions necessary to create a $50,000 appropriation fund designated for the Root
Property at 3930 University -funds to be secured through the City's Anoka County HRA
Levy program.
2) Authorize the staff, based on review by the City and /or EDA Attorney, to enter into an
Agreement with Anoka County that will allow the City to apply for an investigation grant,
through DEED, by November 1, 2011.
3) Authorize up to $10,000 of actual dollar expenditure as part of the 25% equity contribution
required for the grant.
4) Accept a bid for environmental work from (to be discussed at the meeting) based on
successful funding of the grant.
EDA ACTION:
To: Walt Fehst, City Manager
From: Scott Clark, Community Development Director
Re: Anoka County Levy
Date: September 1, 2011
This memo is in response to questions regarding the Anoka County HRA Levy program that was
approved by the City Council on September 10, 2007 (Resolution 2007 -156 attached). Attached with this
memo is an excel spreadsheet dated September 1, 2011 which should give the reader most of the
requested information. Staff would like to note the following:
• The Levy was approved by the EDA and the City Council in 2007 as an additional resource for
important redevelopment or housing priorities.
• Funds must be used for programs that meet either the State's Economic Development
Authority, and /or Housing and Redevelopment Authority's enabling legislation.
• The approval period was a five year levy, after 2012 the City will need to decide if they want to
"opt -in or opt -out" for another five year period. If they "opt -out" they will have to wait an
additional five year period.
• The Levy period runs from 2008 to 2012. The anticipated total five levy credited to the City will
be approximately $1,033,674, depending on the final 2012 allocation.
• To date, the City has three programs that have funds obligated to them totaling $346,647,
leaving a net $687,000.
• The three programs obligated include:
o GMHC Development Agreement for gap financing at 3805 2 nd Street in the amount of
$86,647. Last Agreement amendment approved on June 22, 2010.
o $100,000 for the 37 and Central Agreement -last approved by the EDA on May 2, 2011.
o $160,000 for Make Heights Your Home program approved by the City Council on May
26, 2009 (Resolution 2009 -66). This was a special down payment assistance program for
individuals working with banks to secure combined acquisition and rehabilitation loans
for major rehabilitation work. This program has not been successful in attracting
participants and a reallocation of a portion of these funds to the Root property, 3930
University, clean -up efforts will be presented to the EDA.
• In 2010 the plan was to use the unobligated 2010, 2011 and 2012 appropriations as part of the
redevelopment costs associated with the purchase of the Mady's property. Since that did not
a occur a relook at the use of these funds will need to be made by the EDA.
• Since these funds are capital in nature budgeting and appropriation only occurs at the time that
a specific program is developed, not on an annual basis.
• Staff will present to the EDA, in either late 2011 or early 2012, ideas for obligating the remaining
unobligated funds.
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RESOLUTION 2007 -156
CITY OF COLUMBIA HEIGHTS
RESOLUTION OF THE CITY OF COLUMBIA HEIGHTS TO PARTICIPATE IN THE ANOKA
COUNTY HOUSING AND REDEVELOPMENT AUTHORITY ECONOMIC DEVELOPMENT
ACTIVITIES.
WHEREAS, the City of Columbia Heights is an Anoka County municipality, and such is a rapidly growing and
important segment of the Twin Cities Metropolitan Region, made up of rich variety of vital, desirable communities;
and
WHEREAS, the City of Columbia Heights Council members believe that the residents of Columbia Heights
would realize many benefits from expansion of the Anoka County tax base, including but not limited to; the
creation of localjob opportunities, redeveloping certain sites within the City, as well as maintaining and improving
the City's housing stock, wider sharing of tax burden, and access to enhanced infrastructure, services, and retail
and business activities, and,
WHEREAS, in order to expand the local tax base, the Anoka County Board of Commissioners has indicated an
interest in fostering a regional approach to economic development in Anoka County, and,
WHEREAS, in 2007 a statutorily formed citizens exploratory committee recommended to the Board of
Commissioners that the Anoka County Housing and Redevelopment Authority be granted the powers of an
economic development authority, and
WHEREAS, on June 12, 2007, the Anoka County Board of Commissioners, after fulfilling the statutory
requirements, did authorize their Housing and Redevelopment Authority to exercise the powers of an economic
development authority, and,
WHEREAS, MN Stat. 469.1082 requires that a municipality shall, declare its willingness, by resolution, to join
the county in its economic development activities.
NOW, THEREFORE BE IT RESOLVED, that the City of Columbia Heights does hereby declare its support of
Anoka County and its countywide economic development objectives and activities, and,
BE IT FURTHER RESOLVED that the City of Columbia Heights does hereby elect to participate in Anoka
County Housing and Redevelopment Authority economic development activities, and,
BE IT FURTHER RESOLVED that the City of Columbia Heights does hereby elect to participate in the Anoka
County Housing and Redevelopment Authority economic development activities to request funds to support the
City's redevelopment and housing maintenance and improvement goals, and,
BE IT FURTHER RESOLVED this resolution and attachments are to be made a part of the permanent records of
the City of Columbia Heights.
Passed this 10 °i day of September, 2007.
Motion by: Diehm
Second by: Kelzenbeig
Roll Call: Ayes: Peterson, Williams, Diehm, Kelzenberg
Nay: Nawrocki
L.
Attest: P 4., YY\ r
Patricia Muscovitz, CMC - City 011erk
( k
ID&V West
Casfomor- Focused Eoftn , Maf & Industdaf Sa of a s
August 30, 2011
Bay West Inc.
5 Empire Drive, St. Paul, MN 55103
651291 -0456 ' FAX 651- 291 -0099
www,baywest.com * infoObaywest.com
City of Columbia Heights
Attention Scott Clark
Community Development Director
590 40th Ave NE, 55421
Phone: 763.706.3672 E -mail: Scott clark()ci columbia- heights mn us
Re: Proposal for Phase I and Phase II ESA, and RAP Preparation
Former Root Building
3930 University Avenue NE
Columbia Heights, Minnesota 55421
Proposal Number: P110512
Dear Mr. Clark:
Bay West, Inc. (Bay West) is pleased to provide
this draft work plan to the City of Columbia Heights
Economic Development Authority (EDA). We
understand the EDA is acting as a sponsor for the
above noted property and is coordinating the
environmental assessment of the property with
assistance from the Minnesota Pollution Control
Agency (MPCA) and the Department of
Employment and Economic Development (DEED)
Contamination Clean Up and Investigation Grant
Program.
Bay West responded to an emergency
response call for a mercury spill cleanup on
October 26, 2007. Mercury was identified in
several areas throughout the buildings. The
visible mercury was containerized into drums
and secured in the Root building. In addition,
PCBs were detected at the Site in wipe
samples collected from the main building
basement and loading dock areas. Soil and
groundwater contamination may be present in
and around the buildings from the past uses
of the Site as a trucking company and an
electrical supply company with outside
storage /dumping.
Equal Employment Opportunity /Affirmative Action Employer
1.0 BACKGROUND
During September 2009, Bay West completed a Phase I Environmental Site Assessment (ESA)
for the property on behalf of Realty Executives for due diligence purposes in conjunction with
seeking to qualify for the landowner liability protections (40 CFR 312.26) and to enter into the
MPCA Voluntary Investigation and Cleanup (VIC) Program. Bay West completed the Phase 1,
submitted it to Realty Executives, and was never paid for the work performed. That Phase I is
now out of date and needs to be updated to reflect the passage of time and changes that have
occurred at the Site. Some notable changes at the Site include the removal of main Site
building after it caught fire and partially burned. We understand that the ash from the building
was characterized as PCB contaminated waste that was disposed of as a MNO3PCB1 waste at
a Michigan end facility.
3.0 SCOPE OF SERVICES
The scope of services include the preparation of a Phase I ESA, Phase 11 ESA, and Remedial
Action Plan and assistance in coordinating with DEED and the MPCA. Additionally, Bay West
has estimated the cost for the MPCA VIC program to review and approve these documents,
specifically the RAP.
Bay West has been associated with this Site since 2007 when we initially responded to a call for
emergency response services. Subsequently, we performed a Phase I ESA, prepared multiple
proposals for additional work, aided the City and owners develop other strategies, answered
many phone calls from bankers etc. It is now 2011, and very little progress has been made with
the site. Our approach /scope of work has been designed to be comprehensive in nature in an
attempt to gather the data needed to proceed directly to the preparation of a remedial action
plan (RAP). We anticipate other proposals that may come in will not be as comprehensive as
ours, as we best understand the history of this property and maintain many photographs,
videos, and firsthand knowledge of the site. We hope the Columbia Heights EDA will give
careful consideration to our proposal's content, and keep in mind that a comprehensive
approach is what this Site needs.
The Phase II Subsurface Investigation will be conducted in accordance with the MPCA's VIC
and Risk -based Site Evaluation Process Guidance Documents. The anticipated sampling media
will include primarily soil, with limited groundwater sampling. Soil probes will be advanced near
entry and exit points of the former Site buildings, below the former main building basement floor,
near areas of visible surface staining, and in select areas that help provide broad Site coverage.
Based on the past use of the property, the presence of hazardous materials, the preliminary
Phase I findings, and discussions with property owners, Bay West recommends the following
scope of work be performed:
Prepare a site - specific health and safety plan (HASP);
Conduct a Site visit to update the previous Phase I Bay West had previously prepared
and identify the locations of the soil probes and test pits. The probe and test pit
locations will be based on current and past visual observations, our photo library of the
site, and the location of adjacent or historical areas of concern;
Clear public and private utilities and obtain appropriate permits for drilling work. During
a Site visit on September 24, 2009, Bay West observed several metal pipes protruding
from the ground east of the main building basement drive area. Bay West will attempt to
identify these unknown pipes using the private locator if they are still present.
Soil Probes
Advance up to 20 soil probes around the Site to a depth of six feet; three probes will be
advanced to the groundwater table which is estimated to be approximately 40 feet below ground
surface. At least two of the 20 probes of three probes will be advanced within the foot print of
the main building. Based on the historical knowledge of the Site, the interior building and
exterior of the south side of the building appears to be the most likely location for contaminant
releases. One of the deep probes to groundwater will be advanced in that area to assess what
is likely the "worst case" area for environmental impacts.
Test Pits
Advance up to 10 narrow test pits around the Site to a depth of approximately six feet below the
ground surface to assess if fill material or buried debris is present. Test pits will be observed by
a Bay West environmental scientist who is also a Minnesota Licensed Asbestos Inspector. The
test pits will be advanced in locations that appear to contain fill and /or debris and in select other
areas to provide general Site coverage. The test pits will be excavated and backfilled using a
rubber -tired excavator.
Building Materials
Field screen building materials that remain at the site with the Lumex and XRF in an
attempt to identify potential hazardous materials. If elevated metals are identified, bulk
samples of the material will be collected for laboratory analysis.
Collect up to 5 samples of concrete floors and remaining walls of the main building for
laboratory analysis to assess if the materials are hazardous and require special disposal.
The samples will be analyzed for PCBs and TCLP RCRA Metals.
g ay W
: ma- �,rnxuwFn�w;mw�n�aNmuinsrsoctxs Page 4
Screening and Sampling
Collect soil samples from each soil probe and test pit on a continuous basis, screen the samples
at one foot intervals for headspace readings for organic vapors with a flame- ionization detector
(FID) due to historical Site use and petroleum storage and staining observed; for mercury using
a Lumex meter due to historical Site use and mercury spills; for metals using a X -ray
fluorescence analyzer (XRF) due to historical Site use and observed fill and debris, and classify
the samples based on geology. An on -Site asbestos inspector will observe the test pits and soil
probes for the presence of potential asbestos containing materials.
Submit up to 20 soil samples and three groundwater samples to the laboratory for analysis of
volatile organic compounds (VOCs), polychlorinated biphenyls (PCBs), diesel range organics
(DRO), asbestos, mercury only, and RCRA metals. If RCRA metals are analyzed, mercury will
not be analyzed independently as mercury is included in the RCRA metals analysis. Soil
samples selected for analysis will be from the top two feet of soil, or from the sample interval
that exhibits the most indications of contamination following field screening (FID /Lumex/XRF)
and /or visual observations.
Field screening action levels that trigger laboratory sampling will be as follow:
Screening Method
Action Level
Laborator
FID
>10 arts per million m
VOCs, DRO
Lumex
, " 00 n /m
Mercur
XRF
200 ppm lead
RCRA Metals
Visual Staining
Samples near building entrances
and exits, or visual oil stainin
VOCs, DRO, PCBs
Report
Prepare a Phase II Investigation Report summarizing the results of the investigation and Bay
West's recommendations for the project site. Bay West will then prepare a Response Action
Plan (RAP) to mitigate the release of hazardous substances within /below the remaining building
structure (s) and potential releases to the subsurface soil and groundwater.
Grant Assistance
Bay West will provide grant assistance at no cost to the EDA. It is assumed that the EDA staff
will complete the majority of the grant with Bay West supplying information for the cost analysis
section and scheduling.
COST SUMMARY
Work will be performed on a time - and - materials basis in accordance with Bay West's Standard
Rates. The following table summarizes the cost proposal:
Task '
Estimated Fee
Phase I ESA
$2,891.50
Phase II ESA
$22,236.00
Response Action Plan
$5,505.00
MPCA VIC fees
$1,000.00
TOTAL
$31,632.50
Bay West appreciates the opportunity to complete this Work Plan and Cost Proposal for City of
Columbia Heights EDA. If you have any questions or concerns regarding this project, please
contact us at the below numbers.
Respectfully Submitted,
Matt Schemmel, P.G.
Hydrogeologist
(651) 291 -3410
matts(a)bavwest.com
Attachments:
� Fnvironmental
Murdock
Services Manager
(651) 248 -4291
brvan m a..bavwest. com
A - Cost Proposal
B - Analytical Cost Summary
L:ufar:erfc�unl
and Bay West, Inc. (Bay West) of St. Paul, Minnesota.
Client and Bay West agree as follows:
CONTRACT DOCUMENT — Referred to as the "Contract Document' or "Agreement." Defined as:
PROPOSAL ACCEPTANCE AGREEMENT, the Bay West Project Services Agreement, and any proposals
that includes a scope of services, fee schedules and other documents listed below under PROFESSIONAL
SERVICES.
2. PROFESSIONAL SERVICES — Bay West will provide professional services ( "Services ") for the Client as
indicated in the following documents:
Proposal entitled Phase II Environmental Site Assessment Proposal dated August 30, 2011,
Proposal No. P110512.
Other proposal documents by reference: Proposal Acceptance Agreement Bay West Standard
Fee Schedule.
3. DESIGNATED REPRESENTATIVES —The parties designate the following named individuals as their
authorized representatives to provide approvals, directives, and permissions, including changes, and to
receive notices or other communications under this agreement at the following addresses:
DESIGNATED REPRESENTATIVE
DESIGNATED REPRESENTATIVE
Bay West, Inc.
CLIENT:
Name Address Phone -Email -Fax
Name Address Phone -Email -Fax
Bryan Murdock Office: 651 - 291 -3473
Bay West bryanmebaywest.com
5 Empire Drive Fax: 651 - 291 -0099
St. Paul, Minnesota 55103
YOUR SIGNATURE INDICATES ACCEPTANCE OF THE CONTRACT DOCUMENT INCLUDING THE ATTACHED
PROJECT SERVICES AGREEMENT (TERMS AND CONDITIONS), AS DEFINED ABOVE, UNLESS EXPRESSLY
MODIFIED IN WRITING. ONCE EXECUTED, PLEASE RETURN A COPY OF THE EXECUTED AGREEMENT TO
BAYWEST BY EMAIL, FAX OR MAIL.
ACCEPTED BY:
ag est
(Person authorized to execute contracts)
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ATTACHMENT
Analytical Cost Summary - Subsurface Investigation
Former Root Building
3930 University Avenue NE, Columbia Heights, MN
Id LMy
Hal .Mdtri4 , �, @q„ .:� - AnaIYSIS „�' -P,nca S, �S.ubfolal '
20
1
2
1.
Solid
Pace
Mercury
$ 28.00
$ 56000
EPA 74719470
2
20
1
1 2
Solitl
= 4
Solid
Pace
PCBs
$ 60.00
$ 1,20000
EPA 8082
20
1
'J '.4
Solitl
Pace
VOCS
$ 65.00
$ 1,300.00
EPA 8260
20
1
M21
Solid
Pace
DRO
$ 25.00
$ 500.00
EPA Mod, 8015 /WI DRO
20
1
4
Solid
Pace
RCRA Metals
$ 68,00
$ 1,360OD
EPA 60109470H471
20
Asbestos
$ 10.00
$ 20000
PLM
S
$
Soil Analyals Subtotal =l$ 5,120.D0'$ "nor
V" 0
1
2
1.
Solid
Pace
Mercury
$ 28.00
$
EPA 7471U470
2
3
1
1 2
Solitl
= 4
Solid
Pace
PCBs
$ 60.00
$ 180.00
EPA 8082
3
1
'J '.4
Solitl
Pace
VOCS
$ 85.00
$ 185.00
EPA 8260
3
1
4
Solid
Pece
DRO
$ 25.00
5 75.00
EPA Mod. 8015/ WI DRO
3
1
4
Solid
Pace
RCRA Metals
$ 6800
$ 20400
EPA6010947DR474
Soil Analysis Subtotal= 1 $ 654.00 $ 21.00
iutl n
2
2
Solitl
Pace
TCLP RCRA Metals
$ 113.00
$ 228.00
EPA 1311/8010/]4]0
Concrete
2
I
1
1 2
Solitl
Pare
PCBs
$ 60.00
$ 12000
EPA 8082
Concrete
bon Hnalysls Jgglelal 5 d4a.no
Total Laboratory Analysis COS1= $ 6,120.00
Cry Quantity
FB = Field blank
TS = Trip blank
Dup. = Bupiicala sample
AMERICAN
ENGINEERING
TESTING, INC.
August 30, 2011
City of Columbia Heights
590 40 °i Avenue NE
Columbia Heights, Minnesota 55421
Attn: Mr. Scott Clark
RE: Proposal for Environmental Consulting Services
Redevelopment Property
Columbia Heights, Minnesota
AET Proposal No. 03 -04141
Dear Mr. Clark:
CONSULTANTS
• ENVIRONMENTAL.
• GEOTECHNICAL
• MATERIALS
• FORENSICS
In response to your recent project posting, American Engineering Testing, Inc. (AET) is pleased to
offer environmental consulting services to the City of Columbia Heights (hereafter referred to as
"Client ") for the Redevelopment Property referenced above. This proposal describes the scope of
services, schedule, fees and other information regarding our services.
Protect Information
AET understands the Redevelopment Property is also known as the Root Property, located at 3930
University Avenue. It is currently a vacant property with blighted industrial storage /workshop
buildings. We are unaware if storage tanks are present, but it is a good possibility. Parts of the lot
are covered by scrub trees. We understand that the Client is considering redeveloping the property.
Purpose
The purpose of the environmental consulting services is to provide general assistance with a
Department of Employment and Economic Development (DEED) Investigation Grant application,
prepare a Phase I Environmental Site Assessment (ESA), conduct a Phase II ESA, assist the
Client in enrolling the property in Minnesota Pollution Control Agency (MPCA) voluntary
programs, and prepare a Response Action Plan (RAP) to address contaminant impacts which may
be identified during the Phase I and Phase II stages.
We understand this Phase I ESA is being performed as part of the Client's due diligence process
to satisfy one of the requirements to qualify for the innocent landowner, contiguous property
owner, or bona fide prospective purchaser limitations to CERCLA liability. A complete
evaluation of business environmental risks associated with the subject site may necessitate
assessment beyond that identified in the ASTM Standard Practice for Environmental Site
Assessments and the scope of services described below.
550 Cleveland Avenue North I 5t. Paul, MN 55114
Phone 651- 659 -90011 Toll Free 800- 972 -63641 Fax 651-659-13791 www.amengtest.comI AA /EEO
This document shall not be reproduced, except in full, without written approval from American Engineering Testing, Inc.
City of Columbia Heights
AET Proposal No. 03 -04141
August 30, 2011
Page 2 of 5
Scone of Services
AET proposes to perform the following scope of services:
• Provide general assistance with content and budget for a DEED Investigation Grant
application. AET assumes the City will undertake the formal preparation of the application.
• Prepare a Phase I ESA report. The scope of AET's Phase I ESA is in general compliance
with the Standards and Practices for All Appropriate Inquiries (AAI) rule (40 CFR Part 312,
November 1, 2005) and the American Society for Testing and Materials Standard Practice
for Environmental Site Assessments: Phase I Environmental Site Assessment Process -
ASTM E 1527 -05. You should be aware that, even though we follow the current AAI rule
and ASTM practice standard for this service, there may be localized contamination on the
property we cannot ascertain and will not be responsible for, given this scope of services.
Such contamination could be related to disposal of contaminants not reported to appropriate
government agencies, not made known to us or not reasonably visible to us at the time of
our site observations as part of service for this Phase I ESA.
• Coordinate Phase 11 ESA field sampling activities. Activities will include a site visit, public
utility clearance, field instructions, and preparation. This task does not include permitting
for site access, private utility locates, or clearance of surface obstructions to allow for
accessibility to sample locations.
• Perform ten to twelve soil borings at select locations to depths of 12 to 16 feet below grade,
where we expect to encounter natural deposits underlying fill soils. The borings will be
performed with a truck- mounted Geoprobe system and logged by AET environmental
personnel.
• AET environmental personnel will collect and screen soil samples recovered from the
borings with a photoionization detector (PID) equipped with a 10.6 eV lamp for the presence
of organic vapors. Also, obvious odors and visual evidence of contamination will be noted.
• Collect select soil samples into laboratory- prepared containers for chemical analysis.
Sample selection will be based on screening results, visual /odor observations, and our
understanding of subsurface conditions. In the absence of obvious indications of
contamination, representative samples of fill and natural soil will be collected for chemical
analysis to confirm the samples are uncontaminated. Samples will be retained on ice or in
our laboratory refrigerator until submitted to the qualified subcontract laboratory, following
chain-of-custody procedures.
• Direct the laboratory to perform chemical analysis of the soil samples. AET assumes the
following parameters will be analyzed (anticipated maximum number of samples in
brackets):
- Diesel range organics (DRO) plus silica -gel treatment by WDNR method [15]
- Volatile organic compounds (VOCs) by EPA8260 181
- Polycyclic aromatic hydrocarbons (PAHs) "extended list" by EPA8270 [15]
City of Columbia Heights
ACT Proposal No. 03 -04141
August 30, 2011
Page 3 of 5
- Polychlorinated Biphenyls (PCBs) by EPA8082 [5]
- Organochlorine Pesticides by EPA8081 [5]
- 8 RCRA -list metals by EPA6010B and 7471A [15]
- 8 RCRA -list metals for "hazardous character" by TCLP [6]
• Upon completion of the field activities and receipt of analytical results, AET will summarize
the results and recommendations in a written Phase 11 ESA report. The report will include
documentation on records reviewed, boring logs, methodologies used, maps, and the results
of the analytical testing compared to standards established by the MPCA.
• AET will assist the City in enrolling the property into the MPCA Voluntary Investigation
and Cleanup (VIC) Program and the Petroleum Brownfield Program (PBP), as appropriate.
AET will also provide assistance in coordinating project activities with the MPCA.
• Prepare a RAP to address the identified contaminant impacts for MPCA review.
Remarks
Our services to you are strictly limited to the scope described above. For your information, there
may be certain environmental conditions on a property that are beyond the scope of our Phase I
ESA services. Some of these environmental conditions include substances that may be present on a
property in quantities and under conditions that may lead to contamination of the property or of
nearby properties but are not included in CERCLA's definition of hazardous substances or do not
otherwise present potential CERCLA liability.
Client and User, shall provide AET with all available information pertaining to the subject property,
including the following: legal description(s), plats, and surveys; recorded land title records and
judicial records for environmental liens or activity and use limitations; reports of environmental
assessments, geotechnical exploration, hydrogeologic conditions, and environmental audits;
hazardous waste generator notices and reports; notices or other correspondence with any
government agency regarding contamination at the property or relating to past or current violations
of environmental laws with respect to the property or relating the environmental liens encumbering
the property; registrations for aboveground and underground storage tanks; plans including
Community Right to Know Plans, Safety Plans, Preparedness and Prevention Plans, and Spill
Prevention, Countermeasure, and Control (SPCC) Plans; material safety data sheets (MSDS);
present and past owners /occupants (phone numbers and /or addresses); existing and proposed uses,
activities, etc., which are pertinent to the services provided by AET as part of this proposal.
This scope of services assumes ready access to the sampling locations with a conventional truck rig
on a continuous basis during the field mobilization. We also assume that structures and materials at
the sample locations will not obstruct borings. If these conditions are not met, then the scope may
require adjustments.
City of Columbia Heights
AET Proposal No. 03 -04141
August 30, 2011
Page 4 of 5
Performance Schedule
Based on AET's current schedule, we are available to begin the project upon receiving authorization
to proceed. A Phase I ESA can be completed in three weeks. Soil borings may be scheduled within
two weeks if sufficient background information and site accessibility are established; this schedule
is subject to variability. We expect the borings will take two days to complete. The standard
laboratory turnaround time is 5 to 10 work days. Please contact us if you need to discuss expedited
turnarounds, which will affect laboratory rates.
Conditions
AET's services will be performed per the attached Service Agreement and Subsurface Boring
Supplement.
Fees
AET's fees for services will be charged on a time- and - materials basis. The fee schedule is attached.
We estimate total fees of $24,225.
The estimate above is broken down as follows:
Grant Assistance - $825
Phase I ESA - $1,750
Phase II ESA — $17,825
MPCA Assistance - $825
RAP Preparation - $3,000
The estimated fees are based on the assumptions detailed elsewhere in this proposal. If conditions
vary from assumptions or the scope needs to be amended, AET will discuss the budgetary effects
with the Client's representative.
TECNN ®1�1E5.INC.
9219 East River Road NW
Minneapolis, Minnesota 55433
763 - 786 -1445
Fax 763.786 -1030
www.p rosou rcetecii.coni
September 1, 2011
Scott Clark
Community Development Director
City of Columbia Heights
590 40 °i Avenue NE
Columbia Heights, MN 55421
RE: Professional Environmental Services
3930 University Avenue (Root Property), Columbia Heights, MN
Dear Mr. Clark:
ProSource Technologies, Inc. (ProSource) is pleased to submit this proposal for a Phase I
and Phase 11 Environmental Site Assessment (ESA) and the preparation of a Response
Action Plan (RAP) for the property located at 3930 University Avenue, Columbia Heights,
Minnesota (Site). It is our understanding that these documents are needed by the
Columbia Heights' Economic Development Authority (EDA) in preparing for a grant
application and MPCA VIC application and review. The following project background
information provides a brief description of the potential environmental history of the
property and is the basis of our proposal.
PROJECT BACKGROUND INFORMATION
From our information search, ProSource understands that structures on the property
include the remains of an abandoned warehouse with several outbuildings. The Site is
purported to have been a former residence, a used electric -motor company and a machine
shop formerly operated as Root Equipment Supply. The property address has been listed
on internet sites as a resale, second hand & used merchandise store as well as an electrical
salvage yard.
ProSource has contacted Mr. Jason Moran Emergency Responder for the Minnesota
Pollution Control Agency (MPCA) regarding the Site. Mr. Moran stated that he has
managed emergency responses at the property twice and he was very familiar with the
property. The first emergency response, in October 2007, was for the presence of free
mercury in the main building on the property. The second response, in April 2010, was for
the removal of four 55- gallon drums of an unknown hydrocarbon that was found to be
used motor oil. Mr. Moran stated that the main building burned in mid -March 2010.
Of special note — Mr. Moran stated that ProSource should be aware of other concerns he
had about the property. He stated that he had walked the entire extent of the property
during one of the emergency responses. He stated that he observed many unusual mounds
and disturbed areas across the site. He noted the presence of several "burn areas" that also
drew his attention. He shared that he would anticipate that substances and material of
environmental concern might likely be present beneath these areas. He stated that these
areas should be explored for the possible presence of improperly disposed containers of
potentially hazardous materials, improperly disposed materials or equipment or potentially
hazardous residues of burned liquids and materials.
Environmental e Right of Way a Engineering e Surveying
An Affirmative Action Equal Opportunity Employer
Professional Environmental Services
Columbia Heights Economics Development Authority
ProSource reviewed Minnesota Department of Health Well and Boring Records of wells and monitoring
wells in the immediate vicinity of the site. Based on these records, the depth to groundwater was recorded
as 81 feet below the ground surface. The geology above the groundwater was recorded as sandy clays, sand
and cobbles above 60 feet with hardness recorded as "soft." From 60 feet to the bottom of the borings,
however, the hardness was recorded as `hard" as the geology transitioned into hard sandstone. This data
was consistent for all of the well records reviewed. Due to the depth and geology, ProSource recommends
using hollow -stem auger drilling with a traditional drilling rig. Traditional drilling also allows for the
installation and removal of temporary wells far more effectively than with the GeoProbe.
PHASE IElSA
Upon successful funding, ProSource will conduct a Phase I ESA for the Site. The purpose of conducting the
Phase I ESA is identify historical site activities that could have had environmental impacts on the Site and to
determine if a reported release or threatened release of a hazardous substance, pollutant, or contaminant
exists or has occurred under the meaning of the Minnesota Environmental Response and Liability Act
(MERLA). hn addition, the Phase I ESA will assess the potential for environmental impacts to this Site
from other nearby facilities also covered under MERLA.
The Phase I ESA will be conducted following guidelines established by the American Society for Testing
and Materials (ASTM), "Standard Practice for Environmental Site Assessments: Phase I Environmental Site
Assessment Process, Standard E1527 -05." In addition to the ASTM guidelines, the MPCA Voluntary
Investigation and Cleanup Program (VIC) Program Fact Sheet #8 "Phase I Investigation' will be utilized as
a guide for conducting the work, The work to be provided by ProSource as part of the Phase I ESA includes
the following:
• Site Location Describe the location of the Site by street address, township and /or municipality, county,
and United States Geological Survey (USGS) Quadrants to the nearest 1/4 section.
• History of Ownership Provide the histories of ownership for the Site over the past 50 years or as far
back as there are records, including the name of each owner and the approximate year(s) of ownership.
• History of Operations For each owner /operator of the Site, determine what activities they engaged in.
In particular, determine operation processes, raw products used, types and composition of any waste
streams, disposal methods, environmental permits and solid or hazardous waste streams including
manifests, treatment, storage, disposal, spills or enforcement actions.
• Site Reconnaissance Conduct a walkover of the Site to determine the presence of items including, but
not limited to underground or above ground storage tanks (USTs or ASTs), refuse disposal, wells, septic
systems, sumps, pits, ponds, lagoons, catch basins, retention ponds, areas of surface soil staining,
stressed vegetation, or any other indication of a potential contamination source. Adjacent properties
will also be evaluated to determine if they are potential sources of contamination.
• Site Maps Provide historic and current site maps, which designate the locations of all pertinent current
or former features, structures and potential sources of contamination.
• Database File Search Conduct a database file search of all applicable State and Federal regulatory
agencies to determine the presence or known contaminated properties near the Site.
proso�urce
Professional Environmental Services
Columbia Heights Economics Development Authority
• Information Requests tests Inquire via letter or telephone interview with local officials regarding their
knowledge of the Site. Persons to be contacted may include, but are not limited to the local engineering
and /or public works department, planning and development personnel from the City, County or other
development authorities, zoning and assessment personnel from the City or Canty, the county solid
waste officer, the county hazardous waste officer and /or the local fire department.
• Aerial Photogra hs Review copies of aerial photographs, or reasonable facsimiles, to check for altered
land use, previous storage, etc.
• Sanborn Mans Review copies of historic Sanborn fire insurance maps, or reasonable facsimiles, to
check for altered land use, previous storage, etc.
• City Directories Review historic city directories, which have been published to determine the history of
occupancy.
PHASE II SITE INVESTIGATION
The purpose of the Phase II ESA is to determine if a release of a regulated substance has occurred to the
underlying soils or ground water on the Site. The Phase II is also the basis for the preparation and approval
of the RAP.
Deep Soil Borings for the Collection of Soil and Groundwater Samples
Three soil borings will be advanced for the purpose of collecting soil samples for field screening and
laboratory analysis. The estimated depth for the borings is ninety (90) feet below ground surface.
Recovered soil will be logged in the field using the USCS Soil Classification System. In addition,
ProSource will screen the recovered soils using a photoionization detector (PID), following MPCA bag
headspace methods. Upon completion, each boring will be abandoned in accordance with Minnesota
Department of Health (MDH) well code using granular bentonite. Each boring will be topped off with
compacted soils and staked or marked for future reference and /or survey. Groundwater samples will be
collected from temporary wells that will be installed in the borings following Minnesota Department of
Health requirements.
Based on field screening (visual and olfactory observations, as well as P1D readings), up to 2 soil samples
per boring, one groundwater sample per boring and one quality assurance sample will be collected and
submitted to a laboratory for chemical analysis. A clean pair of disposable latex or nitrile gloves will be
used prior to the collection of each sample. Samples will be preserved, as required and placed into clean,
laboratory supplied sample containers. Each sample container will be uniquely numbered and labeled using
indelible ink. Additional information on the label may include the analytical parameter(s), preservative(s),
sampling personnel, date and time of sample collection, sample type (grab or composite) and the project
number. The label will then be directly affixed to the appropriate sample container. The samples will then
be placed on ice and maintained at a temperature of 4 °C. A chain -of- custody will be initiated and kept with
the samples until custody is relinquished to the laboratory.
We are assuming that drill- cutting soils can be thin spread at the surface in the vicinity of each boring
location. Prior to drilling and prior to demobilization, drilling equipment will be decontaminated to
minimize the potential for any cross- contamitnation.
prosoxurce
Professional Environmental Services
Columbia Heights Economics Development Authority
Chemical Analysis
Six (6) to eight (8) soil and ground water samples will be submitted to and analyzed by a State of Minnesota
certified laboratory for diesel range organics (DRO), gasoline range organics (GRO), volatile organic
compounds (VOCs), polyaromatic hydrocarbons (PAHs), Resource Conservation and Recovery Act
(RCRA) metals and polychlorinated biphenyls (PCBs). We are assuming that the analytical results will be
requested using a standard laboratory turnaround time.
Exploratory Excavation o(Saspicious Mounds and Burn Areas
Due to the known emergency responses at the site by the MPCA and their observations shared with
ProSource, several locations of potential soil impacts may exist across the site, especially around the
warehouse building and observed burn areas not related to the warehouse fire. In addition, the suspect
mounds and areas of disturbed soil may conceal other potential areas of environmental concern.
ProSource recommends, as part of the Phase 11 Environmental Site Assessment, one day of exploration of
the property with a small backhoe and field technician to investigate if these areas might present additional
environmental issues. The exposed areas will be documented with digital photography and samples will be
collected when appropriate. We anticipate 1 -3 samples of impacted soil or suspect material would be
collected for laboratory analysis for the same parameters listed above or, with additional authorization, for
forensic analysis to identify the sampled material.
Chemical Analysis
One (1) to three (3) soil and suspect material samples will be submitted to and analyzed by it State of
Minnesota certified laboratory for diesel range organics (DRO), gasoline range organics (GRO), volatile
organic compounds (VOCs), polyaromatic hydrocarbons (PAHs), Resource Conservation and Recovery Act
(RCRA) metals and polychlorinated biphenyls (PCBs). We are assuming that the analytical results will be
requested using a standard laboratory turnaround time. If a forensic analysis is authorized, analytic
methodologies and associated cost will vary per sample. Such analysis may take longer for results.
Shallow Impacted Soil Sampling Using a Geoprohe
ProSource will perform additional shallow soil sampling to determine the degree and extent of
environmental impacts around the former warehouse and the suspicious mounds and burn areas using a
truck- mounted Geoprobe trait (Matrix Environmental, Inc.). For cost estimating purposes, we have
estimated one day of sampling. The test holes will be positioned in an effort to determine potential impacts
to the soil from potential Site sources. The actual location of the test holes will be based on underground
utilities and Site accessibility.
Soil samples will be continuously collected within the test holes using a MacroCoreTm sampler and screened
on -site with a photoionization detector (PID). Based on field screening and visual /olfactory characteristics,
at least one soil sample from each test hole will be collected and submitted for analytical testing, if indicated.
Chemical Analysis
Eight (8) to fifteen (15) soil and ground water samples will be analyzed by a State of Minnesota certified
laboratory for diesel range organics (DRO), gasoline range organics (GRO), volatile organic compounds
(VOCs), polyaromatic hydrocarbons (PAHs), Resource Conservation and Recovery Act (RCRA) metals and
polychlorinated biphenyls (PCBs). We are assuming that the analytical results will be requested using a
standard laboratory turnaround time.
prosource
Professional Environmental Services
C olumbia Heig Economics Development Authority
For this proposal, because there is limited information regarding how many areas may exhibit adverse
environmental impacts; ProSource is recommending the collection and submittal of 8 to 15 soil samples from
suspected areas across the site.
All information gathered during the Phase I ESA and the Phase II investigation will be presented in separate
reports. ProSource will also provide recommendations for any additional actions at the Site.
VPIC/VIC PROGRAM ASSISTANCE
Dependent on the type of contamination encountered, if any, and with additional authorization, ProSource will
enroll the site into the MPCA's Voluntary Investigation and Cleanup Program (VIC) and /or Petroleum
Brownfields (PB) on behalf of the City of Columbia Heights. With further additional authorization, ProSource
will request a "No Association Determination Letter" from the VIC program.
RESPONSE ACTION PLAN
ProSource proposes to prepare a Response Action Plan (RAP) for review and approval by the MPCA
Voluntary Investigation and Cleanup (VIC) program based on the information we acquire during our Phase I
and II scope of services.
The RAP will include the following:
• Recommendations for additional assessment, if warranted;
• Site Safety and Contingency Plan;
• Determination of risk based cleanup goals;
• Cleanup procedures (i.e. soil excavation procedures);
• Material handling and potential disposal;
• Confirmation sampling and analysis; and,
• RAP Implementation report preparation.
COST ESTIMATE
Phase I Environmental Site Assessment $ 1,800
Phase II Environmental Site Assessment
(Includes laboratory & drilling fees)
I. Deep borings, groundwater sampling $12,326 - $13,978
2. Baekhoe exploration $ 3,476 - $ 4,294
Geoprobe evaluation $ 8,328 - $12,438
3. Preparation of Phase II report $ 1,835 - $ 2,840
Preparation of RAP report $ 3,440 - $ 4,930
Miscellaneous meetings $ 1,585 - $ 2,340
Total Estimated Project Costs $32,790 - $42,620
Please note that the above cost estimate does not include actual soil disposal costs (should that be necessary)
nor does it include fees charged by the MPCA for entry into the VIC program or for MPCA review of reports.
prosource
TECHNOLOGIES. INC.
Professional Environmental Services
Columbia Heights Economics Development Authority _
ProSource is prepared to begin work on the project immediately upon receipt of your approval to proceed.
Should you have any questions, please feel free to contact us at 763- 786 -1445. We look forward to working
with you on this project.
Sincerely,
ProSource Technologies, Inc.
Dfd Ile�m en
Director of Environmental Services
Project Manager
To authorize the work, please review the attached Terms and Conditions, sign in the space provided below and
return via fax to 763-786-1030.
Accepted by:
Name and Title
Thomas H. Maiello�
Date
ProSource
TEOHNO&OOIES,IND.
Not for public. rn
int iotion
'IQ -7
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meeting of: September 6, 2011
AGENDA SECTION: Executive Session
ORIGINATING
EXECUTIVE
NO:6
DEPARTMENT: EDA
DIRECTOR
APPROVAL
ITEM: Discussion on purchase of 4641 and 4647
BY: Sheila Cartney
BY:,
Tyler Street— Resolution 2011 -14
DATE: August 24, 2011
BACKGROUND: In May 2009, the City and EDA modified the Tax Increment Plan for the Kmart/
Central Avenue TIF District (T4) to include 55 parcels in the "Sheffield Neighborhood." The plan
provides for a wide range of redevelopment work that is including, but not limited to, acquisition,
demolition, utility and street work. Additionally the city was awarded a CDBG grant in the amount of
$170,000 for demolition of properties located in the Sheffield neighborhood. As part of the grant
application the Council approved the Sheffield Neighborhood Action Plan (SNAP) that includes a
collaborative effort between departments and outside sources for this area.
To date the City /EDA has purchased 7 parcels in the Sheffield neighborhood and demolished all the
buildings associated with these parcels. The majority of the parcels have been located on Polk Street.
There has been a significant decrease in crime and calls for service as well as code enforcement issues
on Polk Street. Removing these structures are the first steps in stabilizing this area. The Police
Department continues to dedicate significant time and resources to this area. City departments have
been working collectively on different levels of enforcement in this area as well to try to sustain and
improve these neighborhoods.
Anoka County Community Action Program (ACCAP) owns the properties at 4641 and 4647 Tyler
Street and has approached the city to purchase these properties. ACCAP has stated they have had
difficulties in finding good tenants for these properties and no longer wish to own and operate these
facilities. ACCAP approached the city before going to the open market because they support our
redevelopment efforts in this area. The City /EDA does not own property on Tyler Street and see this
as an excellent opportunity for a socially responsible acquisition in making a physical environmental
change to this block and in our efforts to restructure the neighborhood density and land configuration
(the lots are 7,680 square feet each). The Police Department has increased their resources to Tyler
Street and is in full support of this purchase and sees this as another positive step for the community
(see attached letter from Police Chief Nadeau, dated 8/24/11). The payable 2012 market value for the
ACCAP properties is 315,000 each ($630,000 total), the appraised value for the two properties is
$186,800 each ($373,600 total). ACCAP has indicated they would be willing to sell to us for a little
below appraised value and they would remove usable appliances and materials from the units. Staff
suggests offering a maximum purchase price of $320,000 for both properties (this equates to $40,000
a unit). If the EDA elects to purchase the properties the T4 TIF district will have a remaining balance
of $327,140.
RECOMMENDATION: Staff recommends entering into negotiations for the purchase of the four -
plexes at 4641 and 4647 Tyler Street, by approving the Resolution authorizing a purchase price up to
$320,000.
RECOMMENDED MOTION:
Motion: Move to waive the reading of Resolution 2011 -14, there being ample copies available to the
public.
Motion: Move adopt Resolution 2011 -14, authorizing staff to enter into negotiations with ACCAP for
the purchase of the four - plexes located at 4641 and 4647 Tyler Street with a maximum purchase price of
$320,000, using fiord 371. Furthermore to authorize the Mayor and Executive Director to enter into an
agreement for the same.
Mesolittim 21111 -14 Letter or support mom Po ace �mei rvnucau
EDA ACTION:
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION 2011 -14
RESOLUTION AUTHORIZING EXECUTION OF A PURCHASE AGREEMENT
FOR CERTAIN REAL PROPERTY LOCATED AT 4641 TYLER STREET
NORTHEAST AND 4647 TYLER STREET NORTHEAST IN THE CITY AND
ASSIGNMENT THEREOF TO THE COLUMBIA HEIGHTS ECONOMIC
DEVELOPMENT AUTHORITY
Section 1. Recitals
1.01. The Columbia Heights Economic Development Authority (the "Authority ") administers
the Downtown CBD Redevelopment Project (the "Project ") within the City, which was established
under Minnesota Statutes, Sections 469.001 to 469.047 (the "HRA Act ").
1.02. The Authority has undertaken a program to acquire homes in the Project in order to
address foreclosure problems and remediate and prevent the emergence of blight.
1.03 City staff is negoting a Real Estate Purchase Agreement with the Anoka County Community
Action Program ACCAP (the "Seller ") dated as of July 25, 2011 including all related addenda and
disclosures thereto (collectively, the "Purchase Agreement "), for real property located at 4641 Tyler
Street Northeast and legally described as follows: ALL OF LOT 25 & S 20 FT OF LOT 26, BLK 2,
SHEFFIELDS 2ND SUB
and 4647 Tyler Street Northeast and legally described as follows: LOT 27 BLK 2 SHEFFIELDS 2ND
SUB, TOG /W LOT 26 SD BLK, EX S 20 FT THEREOF, SUBJ TO EASE OF REC
(the "Properties "), which Purchase Agreement is contingent upon approval by the Economic
Development Authority.
1.04. The Purchase Agreement will be prepared once a price is negotiated and on file with the
City Manager, and /or the Executive Director of the EDA.
Section 2. Approval and Assignment
2.01. The Purchase for the Property is hereby approved, and the execution of the Purchase
Agreement by the EDA is hereby ratified. Pursuant to the Purchase Agreement, the EDA will purchase
these Properties for up to $320,000. City staff and officials are authorized and directed to take all such
other actions to complete the purchase of the Property, including without limitation execution of all
documents and agreements related to such transaction.
2.02. Contingent upon approval of the Authority, the City hereby assigns its interests in the
Purchase Agreement to the Authority. City staff and officials are authorized and directed to take all
such other actions to complete the assignment of the City's interests in the Purchase Agreement to the
Authority, including without limitation execution of any documents and agreements necessary to
effectuate such assignment.
1
Passed this 6 day of September
Offered by:
Second by:
Roll Call:
ATTEST:
President Gary L. Peterson
Shelley Hanson, Secretary
A Ni
M .
Columbia Heights Police Department
Scott Nadeau, Chief of Police '.
h
M"
August 24, 2011
Columbia Heights Economic Development Authority
City of Columbia Heights
590 40` Avenue NE
Columbia Heights, MN 55421
Members of the Economic Development Authority:
Subject: Acquisition of ACCAP properties at 4641 and 4645 Tyler Street
It has come to my attention that Columbia Heights Community Development is considering the
purchase of the properties at 4641 and 4645 Tyler Street from the Anoka County Community
Action Program. I would like to write a letter in support of this effort. As you may be aware, re-
development of the Sheffield area has been a city priority for over ten years, and in the past three
years has been the focus of a collaborative effort between Columbia Heights city departments, the
City Council and other strategic partners.
Working together in the Sheffield Neighborhood Action Plan, the Columbia Heights Police
Department, the Columbia Heights Fire Department and Community Development have been able
to lower the incidents of criminal activity and have made some improvements to the physical
environment to the Sheffield neighborhood. These improvements have included more strict code
enforcement, removal of graffiti and junk vehicles, as well as the acquisition and removal of
blighted and foreclosed multi - family dwellings.
It is the strong opinion of the Police Department that code enforcement and a disproportionate
allocation of law enforcement resources has made gains; however, these gains are not sustainable as
continued changes need to be made to the physical environment in Sheffield, and on Tyler Street in
particular. In the past three years, the Police Department has dedicated thousands of hours of time,
including meeting with landlords to ensure that they are following ordinances and statutes in
relation to tenant activity and often having to work on crime mitigation plans to try and stem
activity such as narcotics, assaults, robberies and nuisance types of infractions. While dedicating
law enforcement resources to the Sheffield area has produced lower crime, it has come at the cost of
vast amounts of overtime, as well as the Police Department's not being able to use proactive
resources in other areas of concern in the community. The issues in Sheffield can't be solved only
through law enforcement and code enforcement activity.
825 41" Ave NE Columbia Heights, MN 55421 (763) 706 -8100 f.• (763) 706 -8126
www.chpolice.com
Columbia Heights Economic Development Authority
August 24, 2011
Page 2
In analyzing the purchase of the ACCAP property, the Police Department selected comparable
properties at 4625 and 4633 Tyler Street which have a similar design as both are four -unit row -style
buildings. One of these buildings was purchased by a private party in foreclosure and rehabbed in
2009. These properties have continued to present challenges for the Police Department in the terms
of people loitering, drunk and disorderly activity, multiple search warrants for stolen property and
narcotics, sexual assaults and other serious offenses, accounting for over 120 police calls for service
since 2009. The Police Department has also served multiple search warrants and had to work with
the property owner on a crime mitigation plan which reduced the incidents of crime, although the
property continues to be an area of concern for the Police Department, requiring a disportionate
amount of law enforcement resources.
In speaking with Community Development Director Scott Clark, I have been informed that Anoka
County had concerns about trying to find suitable tenants to rent these units because of the
environment in the 4600 block of Tyler Street. These comments are consistent with other landlords
we have regular contact with on Tyler Street, to include the owners of 4616 and 4622 Tyler Street
and 4628 and 4634 Tyler Street. We feel that the redevelopment of Tyler Street is consistent with
previous efforts to redevelop the Sheffield area and that the opportunity to acquire these properties
from Anoka County at a significantly reduced price is an opportunity that should be seriously
explored.
Please contact me if you have any questions regarding this letter of support or if there is any other
way the police department can provide information that would assist you in making the decisions.
Sincerely,