HomeMy WebLinkAboutEDA AGN 11-05-12AGENDA
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
Monday November 5, 2012
6:30pm City Hall, Conference room
1. Call to Order/Roll Call
Gary L. Peterson, President
Donna Schmitt, Vice President
Bruce Nawrocki, Secretary /Trasurer
2. Pledge of Allegiance
Bobby Williams
Tanunera Diehm
Gerry Herringer
Marlaine Szurek
CONSENT AGENDA
3. Approve Minutes of August 6, 2012 meeting, Special meeting of August 27, 2012, Special meeting
of September 17, 2012 and Executive Session of September 17, 2012
a. Approve financial report and payment of bills for July, August and September 2012 on
Resolution 2012 -14.
Motion: Move to waive the readings of Resolution 2012 -14 to approve Consent agenda as presented.
BUSINESS ITEMS
4. Grand Central Loft Town homes proposal — Synergy Land Company
5. Scattered Site Relator RFP Review
6. Consider donation of 666 40 °i Street Property
Motion: Move to waive the reading of Resolution 2012 -15, there being ample copies available to
the public.
Motion: Move to approve Resolution 2012 -15, authorizing acceptance of the donation of the
property located at 666 40 °i Avenue Northeast in the City of Columbia Heights; furthermore
authorizing the City Manager to enter into any agreements for the same.
7. Anoka County Tax Levy
8. Administrative Report
9. Adjourn
The next regular FDA meeting will be Monday December 3. 2012 at City 11all.
ECONOMIC DEVELOPMENT AUTHORITY (EDA)
MINUTES OF THE MEETING OF
AUGUST 6, 2012 IN CONFERENCE ROOM 1
The meeting was called to order at 7:12 pm by Chair Peterson.
Members Present: Bruce Nawrocki, Gary Peterson, Donna Schmitt, Gerry Hettinger, and
Tammera Diehm.
Members Absent: Marlaine Szurek and Bobby Williams
Staff Present: Walt Fehst, Scott Clark, Sheila Cartney, and Shelley Hanson.
Also present were: Peter Jesh of Coventry Senior Living and Keith Ebensteiner from ReMax Real
Estate Company.
2. PLEDGE OF ALLEGIANCE- RECITED
3. CONSENT ITEMS
1. Approve the Minutes from Special Meeting of May 7, 2012 and from the Executive
Session of May 7, 2012.
2. Approve the Financial Report and Payment of Bills for April, May and June 2012 on
Resolution 2012 -09.
Questions from members:
There were no questions.
Motion by Diehm, seconded by Schmitt; to waive the reading of Resolution 2012 -09, there
being an ample amount of copies available to the public. All ayes. MOTION PASSED.
Motion by Diehm, seconded by Schmitt; to approve the minutes and adopt Resolution 2012 -09.
All ayes. MOTION PASSED,
EDA RESOLUTION 2012 -09
RESOLUTION OF THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
(EDA) APPROVING THE FINANCIAL STATEMENT FOR APRIL, MAY, AND JUNE 2012 AND
PAYMENT OF BILLS FOR THE MONTHS OF APRIL, MAY, AND JUNE 2012.
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
EDA Minutes
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August 6, 2012
WHEREAS, the financial statement for the months of April, May, and June 2012 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 meld 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 6th Day of August, 2012
MOTION BY: Diehm
SECONDED BY: Schmitt
AYES: All ayes
Gary Peterson, President
Attest By:
Shelley Hanson, Secretary
BUSINESS ITEMS
4. General Discussion with Coventry for Assisted Living Proposal at 370i and University
Clark explained that Peter Josh, representing Coventry Senior Living which is part of a Company
named ICON, was resent to have an informal discussion with the EDA regarding a potential assisted
living facility at 37" and University. The EDA's role in this is that the subject property parcels are
under the "Huset Park Redevelopment Agreement" which specifically calls for 183 units of owner
occupied condominiums or cooperative limits, plus 11,600 sq. of retail. If this project proceeds, a
formal amendment to the Agreement would have to be made in addition to the normal land use
permitting process through the Planning Commission and City Council. Clark explained the
ownership history of the site to the members.
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August 6, 2012
Mr. Jesh introduced Keith Ebensteiner from ReMax who is working with BNC Bank to market and
develop the remaining pieces of this site. Jesh stated that ICON is interested in constructing an
Assisted Living building on the remaining Phase 2 piece and a Sr. Independent Living building on the
site by the roundabout. If those buildings are successful they would potentially build another
Assisted Living Building on the south piece at 37°i and University Ave. Jesh says having an
independent building nearby naturally feeds the occupancy of the Assisted Living building. He told
members that if the project moves forward, they plan on having Ebenezer manage the building(s).
Jesh said they have done market studies and there is a need for this type of housing in this area. He
told members the preliminary plan is to construct a 95 -100 unit, 4 story building on the Phase 2 site
of Assisted Living space, and a 50 -100 unit, 3 or 4 story building on the roundabout site of Sr.
Independent Living space. He said it generally takes one year to build and two years to fill the units.
Development of the south piece would depend on how quickly the units rent out.
Clark asked Jesh if ICON would be taking Fee Title for all three pieces and Jesh stated they would, if
they can come to an agreement with the bank. The members asked if the retail component would still
be considered as part of their plans. Jesh stated that would depend on the market needs in the area.
He intends to keep it as a possibility.
Diehm said there are currently other Assisted Living facilities in Columbia Heights and that those
buildings are not full. She questioned whether he has done recent market studies to justify additional
construction of this type. Jesh said he had, and that the studies indicate a need for "Elderly Waiver"
units. New Perspectives /Lighthouse is a market rate building. He told members their buildings
would primarily be `Elderly Waiver" or a mix of both.
Herringer asked if the `Elderly Waiver" would apply to the Independent Living units as well. Jesh
said no, just the Assisted Living Building. He told members that part of the plan is to react to the
needs of the public as there are many types or levels of Sr. Assistance. Jesh said that often times they
can tie some of the services for both buildings together such as the emergency life line alerts.
Nawrocki asked if the units would be owner- occupied condo units, or rental units. Jesh said they
would be rental.
Coventry Senior Living has found it beneficial to have Ebenezer manage their buildings since they
are affiliated with Fairview Health Systems which also direct people to their housing options. Jesh
told members Coventry Sr. Living has the following buildings: Maplewood -they are 90% done with
construction of 107 -unit building and that 25 units are already reserved. They will be breaking
ground this summer for another building in Mounds View. Coon Rapids -90 units that is 90% full, and
a new building in Mahtomedi with 48 units that is 75% full. Jesh said his job is to find sites and get
the financial deals put together.
Schmitt asked if the EDA is in favor of this, how soon it would be until ICON started construction.
Jesh told them it would take 4 or 5 months to complete the sales transaction if the bank accepts their
offer, and they would probably start construction in the spring of 2013. Ebensteiner told members
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August 6, 2012
there are 23 banks involved in the ownership of this site and they must work through that, but they
felt the first step was to see if the EDA is interested in this type of project before they expend funds to
pursue this.
Diehm stated she was excited to see any interest in the site and would like ICON to keep an open
mind about including some space for retail in their plans.
Schmitt thought it was a great idea, especially since they are interested in developing all three pieces.
She also stated she is very comfortable with Ebenezer managing the buildings as they have a good
reputation with such facilities.
Herringer said he believed it is a positive move to complete the development and that he would keep
an open mind about the deal and the plans.
Nawrocki said he wouldn't commit yet as he didn't have enough information.
Peterson stated he felt it was a good option for the community. He knows there are a lot of hurdles,
but is excited to see the project move forward. Peterson told Jesh, that four of the five members
present were in favor of them pursuing the purchase and development of the remaining parcels for
Senior Living Buildings as informally discussed.
5/6. Resolution 2012 -10 HRA Levy Budget
Clark explained that the 2013 budget for all of the Community Development Department was
enclosed in the agenda packets. Although some of the Department's budget (fund 20 1) is not
controlled by the EDA, the EDA traditionally reviews and acts on this budget as a whole, which is in
turn, finalized by the City Council. The actual EDA portion of the budget is fund 204 and the
attached resolutions serve as 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, and expenditures (combining fund 201 and
204) have been reduced by 2.6% comparing 2012 to 2013.
Clark reviewed this year's budget highlights are as follows
1.The 2012 HRA levy (called statutorily a special benefits levy), is driven by a State
formula using the City's market value, has been reduced by $8,553 from $218,343 to
$209,790. The EDA traditionally maximizes the HRA levy as budget revenue, and the
aforementioned reduction is due to market value reductions. The EDA levy (under
separate resolution) has been maintained at prior year levels equaling $84,811.
2.The reduction in the HRA levy, coupled with the EDA levy and one quarter only of
Parkview administration revenue ($9,250) almost balances the fund 204 expenditures.
The anticipated $20,209 expenditure over revenue difference, if realized, will be made
up by fund 204 fund balance.
3.17und 201 (Protective Inspections which includes building inspections and planning) has a
proposed shortfall of $69,049. The difference will be made up by existing fund balances
EDA Minutes
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August 6, 2012
in Fund 201. The aforementioned loss is a projected worst case scenario and one or two
unanticipated projects in 2013 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 operating losses and
the fund is replenished in years when revenues exceed expenditures.
Staff recommends the Levy's as recommended.
Questions by members:
Nawrocki stated he was surprised at some of the figures. He believes the whole budget should be reviewed, not
just individual departments or funds. He went on to say there should be further reduction of expenditures.
Clark said Fund 204 (EDA Administration) has been reduced by $16,000. He went on to explain that the EDA
does not approve Fund 201 (Protection Inspections) —that is done by the City Council. Information on that fmid
was included since Community Development is responsible for both funds. Nawrocki stated that the budget
indicates that fluid balances will be used to balance the 201 budget, and he disagrees with doing that. Clark
explained to members that some years the revenues exceed projections due to a healthy economy, and a lot of
construction and remodeling being done. Other years do not bring in enough revenue to cover expenses, so fimd
balances must be used. This is something that is hard to foresee and action one way or the other is usually done
in hindsight. This service is something that must be provided per State Law, but revenues constantly fluctuate
and are hard to predict.
Nawrocki then asked about increased amounts in the contingency fund and was told that was where the cost of
living expenses were categorized. He then complained about the cost of refreshments for residents who went
through the Citizen's Academy. He noted that the reduction in the administration fee from Parkview Villa
indicates that the sale will probably go through and it is another reason that personnel should be cut from
Community Development. Fehst stated that this Department curt three positions in the last five years, and that
none of them have been replaced.
Schmitt stated she thought the Parkview Administration Revenue should be included in the budget for the entire
year since the sale has not been finalized. Clark will make that adjustment.
Nawrocki asked for clarification on the two Resolutions and needed to know which figures went with each
Resolution.
Motion by Diehrn, seconded by Schrnitt, to waive the reading of Resolutions 2012 -10 and 2012 -11 there being
ample copies available to the public. All Ayes. MOTIOIN PASSED.
Motion by Melon, seconded by Schrnitt, to approve Resolution 2012 -10, Resolution 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 2013. Roll Call: ayes- Diehni, Schmitt, Peterson, and Herringer
Nays - Nawrocki MOTIONPASSED.
Motion by Diehrn, seconded by Schrnitt, to approve Resolution 2012 -I1, Resolution of the Economic
Development Authority (EDA) in and for Colunibia Heights Adopting the 2013 budget and setting the EDA Levy
with the correction of adding revenues for entire year for Parkview Villa Administration. Roll Call: ayes- Diehrn,
Schmitt, Peterson, and Herringer
Nays - Nawrocki MOTIONPASSED.
EDA Minutes
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August 6, 2012
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO. 2012-10
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 2013
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 HRA, together, to
levy and collect a special benefit levy of tip 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 2013; and
WHEREAS, the EDA has before it for its consideration a copy of a budget for its operations for the fiscal
year 2013 and the amount of the levy for collection in fiscal year 2013 shall be based on this budget.
NOW, THEREFORE, Be It Resolved by the Board of Commissioners of the Columbia Heights
Economic Development Authority:
I . The budget of $324,060 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 $209,790 with respect to taxes payable in
calendar year 2013.
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 2013 and to take such other actions as are necessary to
levy and certify such levy.
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August 6, 2012
Motion by: Diehm
Second by: Schmitt
Roll Call: ayes - Diehm, Schmitt, Peterson and Herringer
Nays - Nawrocki
Motion passed this 6i' day of August 2012
Attest by:
Walter R. Fehst, Executive Director
Gary L. Peterson, President
EDA RESOLUTION 2012 -11
RESOLUTION OF TIIE ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR COLUMBIA
HEIGHTS (EDA) ADOPTING THE 2013 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 469.1081, 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 $324,060 for year
2013.
2. The EDA adopts and recommends to the City Council for approval a levy of $84,811 for year 2013.
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 6 °i day of August 2012
MOTION BY: Diehm
SECONDED BY: Schmitt
Roll Call: ayes - Diehm, Schmitt, Peterson, and Herringer
nays- Nawrocki MOTION PASSED.
Attest by:
Walter R. Fehst, Executive Director Gary L. Peterson, President
EDA Minutes
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August 6, 2012
7. Resolution 2012 -12 Approving Funding for the Single Family Deferred Loan Program
Cartney requested that the Economic Development Authority (EDA) authorize funding of $35,000 for the
Single - Family Home Deferred Loan Program (SFDL), which was included in the Housing Maintenance Plan
2008 — 2017, approved by the EDA on August 18, 2007.
The purpose of the SFDL 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 SFDL 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. To qualify for the program, the homeowner must provide
matching funds for the remaining project costs. 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 funds available to finance future loans.
In February 2011, the EDA allocated $35,000 to this program, to date $60,940 in loans have been obligated
resulting in $0 fund balance for the remainder of 2012; if the EDA would like to continue the SFDL program
staff suggests allocating $35,000 for 2012, which historically has been sufficient for a yearly allotment.
Staff recommends the EDA obligate $35,000 from fund 420 for the Single Family Deferred Loan Program.
Questions from members:
Members inquired how much money was in the fund 420. Cartney responded that currently there is
approximately 1.9 million in that fund and this request is for $35,000.
Herringer asked how much interest applicants pay for this money. Cartney stated they pay 2% simple interest at
the time of sale. The interest is not accrued on an annual basis.
Nawrocki stated that the EDA recently approved $50,000 in funding and wondered why we are approving
another $35,000. Cartney said the $50,000 funding approved in May was for the Rebate Program. She explained
the difference between the two programs and told members how much was used last year.
Herringer asked how many applications we currently have waiting. Cartney told him staff has not been taking
any applications for this program since additional funding had not yet been approved. He asked if the funds
would carry over till next year if not used in the remaining mouths of 2012 and she told him, yes.
Motion by Diehrn, seconded by Schmitt, to waive the reading of Resolution 2012 -12 there being ample copies
available to the public. All ayes. MOTIONPASSED.
Motion by Schmitt, seconded by Diehnr, to approve Resolution 2012 -12 approving funding of $35, 000 for the
Single Family Deferred Loan fr-a» r fund 420. All ayes. MOTION PASSED.
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August 6, 2012
EDA RESOLUTION NO. 2012-12
A RESOLUTION APPROVING FUNDING FOR THE SINGLE FAMILY DEFERRED LOAN
PROGRAM ($35,000)
WHEREAS, since 2007 the Economic Development Authority (EDA) has provided the Single Family
Deferred Loan Program to residents of the City of Columbia Heights, and
WHEREAS, the Columbia Heights EDA through its Comprehensive Plan has established as a goal
the preservation of the single - family housing stock; and
WHEREAS, the EDA approved the Housing Maintenance Plan 2008 -2017 to improve and maintain the
residential homestead housing stock; and
WHEREAS, this resolution seeks to authorize and provide additional funds for the continuation of the
City's Single Family Deferred Loan Program to be administered by the City.
NOW, THEREFORE, BE IT RESOLVED that the EDA allocates $35,000 for the Single Family
Deferred Loan Program from Fund 420 — Capital Improvement Development Fund.
Passed this 6 °i day of August, 2012.
President
Walter Fehst, Executive Director
8. Scattered Site Update /Direction
Cartney told members that in February, the EDA approved RFP guidelines and directed staff to send out
the RFP for development of four scattered site lots (4303 Reservoir Blvd, 4502 Washington, 4110 6`r',
and 4421 5`r'). Staff sent out twenty RFP's directly and also listed the lots and RFP on the City's
Webpage. The RFP provided a two month window for applicants to submit their proposals, no
proposals were received. Currently the four lots are listed for sale on the City's webpage, on
Hndingmyroof.com a free real- estate listing site and Postlets.com a website that lists the real estate on
several webpages for free. Because of the direction in February to only list the four lots, staff has not
listed any other lots for sale on the webpage, as price points have not been established.
In February the EDA also discussed three other options: (1) City continue to market and sell the
properties with assistance of the EDA attorney, (2) Hire a realtor to market and sell the properties, (3)
Partner with Anoka County's Realtor who is familiar with the area and restrictions as he is selling the
County's NSP lots.
If the EDA were to choose option (1) a budget should be created for marketing (signage, web listings
etc). If option (2) is selected an RFP would go out to the St. Paul Realtors Association and on our
webpage and staff would bring back a recommendation at a later EDA meeting. Staff met with Anoka
County's realtor, Jared Hoylo with Remax Advantage Plus, in January to discuss what Anoka County is
doing with their lots, at that time he indicated he would be interested in listing the EDA lots, but has not
EDA Minutes
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August 6, 2012
been contacted since then (option 3). Regardless of what option the EDA decides to go with staff
recommends using the established guidelines for all the lots. Staff recommends the Board give approval
to send out RFPs to various Realtors and see what they propose. The RFPs will ask them to submit
their contacts, background, credentials and the amount of Commission they will charge to market the
lots for us.
uestions from members
Schmitt asked about the possibility of selling the lots to neighboring properties. Fehst said he'd rather
see the lots marketed for construction of new homes. This way we would recoup some of our expenses
and it would generate more tax dollars through the years. Cartney said the lots would have to be taken
out of the TIF District in order to do that. It was noted that if these empty lots were combined with
another lot that it would generate much less tax dollar revenues.
Nawrocki thought the goal should be to try and recuperate some of our costs associated with buying
these properties and demolishing the structures.
Clark said the EDA knew it would take some time to sell the lots for new construction, and we must try
different ways to market them to meet this goal.
Hettinger asked if they would fall under the" 9 year rule" for paying taxes on them. Clark told him,
yes.
Schmitt liked Option 2, plus she suggested putting up "For Sale" signs on the 4 properties we are
focusing on currently. She also stated that when we get the RFP's back from the Realtors that we
should be able to negotiate the amount of commission and that a list of all the lots should be included
for them to market, not just the four "select" lots. The members agreed with this direction.
9. Anoka County Tax Levy
Clark stated that in 2007 both the Economic Development Authority and the City Council entered
into discussions and approved participating with the Anoka County Housing and Redevelopment
Authority, for five years, to levy a tax for economic development purposes. Enclosed in the packet
was the August 28, 2007 EDA report and City Council Resolution #2007 -156 which will give the
rationale for the participation. At that time, it was calculated that the total five year allocation would
be approximately $1,285,776 minus the County's administration fee of 15% (the final net number
would be $1,092,250). However, the total net anticipated allocation from years 2008 -2012 is only
$937,524 since the levy amount is driven by State formula and is calculated based on City marketable
tax value, which has decreased greatly over the past 5 years.
Also enclosed was a spread sheet showing the obligated and unobligated funds for the 2008 through
2012 allocations. The majority of the funds were previously dedicated to the purchase of the "Mady's
Property" as part of a large redevelopment action, but the offer to purchase the property was
rescinded by the owner.
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August 6, 2012
The Anoka County levy program is a rolling five year program which means that the City /EDA has
to either (1) Agree to be part of the program for another five years (years 2013- 2017 with an
estimated total net allocation of $850,000 ($170,000 annually) or (2) Not re -up and forfeit the
opportunity to participate for the full five year cycle. The policy question for the EDA is whether or
not to use this program as a future source for redevelopment, housing and /or economic development
programs. The EDA has limited resources for future activities and this allocation provides another
tool for activities that could otherwise be halted due to a lack of funds. From a staff perspective, the
lack of a specific program attached to these funds should not be a rationale for discontinuing the levy
program. As the City ages, new issues and hopefully opportunities, will present themselves for public
assisted reinvestment. As stated previously, these funds can't be generated at a future date, nor are
they characterized as grant funds that could be applied for when needed. The funds can be viewed as
a means to create a fund balance towards future expenditures that are consistent with an aging
community and match the goals of the City. Examples of future use could be purchasing or assisting
in a major redevelopment effort (such as a Mady's type project) or a loan program that would
leverage these funds and allow access to a greater range of income levels.
According to Anoka County, if the City desires to proceed with a new five year allocation no new
resolution has to be passed and the extension is automatic. If the City elects not to pursue this funding
levy a letter should be forwarded regarding the same.
Staff views that as an aging community the EDA should avail themselves to whatever funding
sources that they can for future projects. As stated in the 2007 report, if an EDA has a future project
that is critical these funds can serve as an alternative to bonding, reducing the EDA's current
redevelopment funds and /or the need to seek funding from other sources. Many first ring suburbs
have compiled significant levels of redevelopment fund balances from old tax increment districts and
this City has not had that luxury, meaning that building fund balances for redevelopment efforts
needs to come from whatever sources can be found. That being said staff recommends continuing
with the five year program.
Questions from Members:
Nawrocki strongly opposed continuing with this program. He feels this is a deceptive way to collect
additional tax dollars from our residents and that $125,000 is taken off the top by Anoka County. He
said if additional funds are warranted for redevelopment efforts then raise the taxes to do so, and not
go through this process which hands over funds to the County that could be used by the City.
Fehst agrees with Nawrocki to a point on how it's done. However, we have no other way to get
money for redevelopment projects, and if we don't have funds in place, then we cannot take action on
properties that may become available to us for improvement. There was a brief discussion about the
options we have to increase levy amounts that would provide funds without continuing with this
particular program.
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August 6, 2012
Diehm questioned whether we will still have an I -IRA levy once Parkview Villa is sold. Clark stated
that, yes there will still be an HRA levy and a HRA Commission since we deal with other housing
issues and programs other than just Parkview Villa. The levy structure won't be changed after the
sale. Diehm then asked how soon we have to make a decision on this matter. Clark told her by
October. She then suggested tabling this until the next meeting so that more information can be
reviewed in regards to potential target areas, additional tax levy options, and current fund balances.
Motion by Schmitt, seconded by Herringer, to bring this item back at the September meeting. All ayes.
MOTION PASSED.
10. 828 40`x' Avenue Tax Exemption Status
In 1999 the EDA purchased property at 828 40 °i Ave with an old TV repair building on the lot. In 2001 the
building was torn down leaving a vacant green space. Community Development Block Grant (CDBG) money
was used for the purchase and demolition. The purchase price was $72,246.50 and demolition was $7,117.20 a
total of $79,363.70 of CDBG funds used. After purchase of the lot, the property was placed into tax exempt
status.
For the past three years the subject lot has been used as a community garden and in 2011 the EDA turned down a
proposal to sell the subject lot for a parking lot proposal for an adjacent accounting firm. It was also at that time
that Anoka County explained national objective needs to be met or the city would need to pay back some of the
CDBG funds (market value not the total funds used).
Based on a letter dated January 23, 2012 from Anoka County, as of December 31, 2012 the subject lot will no
longer be tax exempt. State Statute 272.02 Subd. 39 states "The holding of property by a political subdivision of
the state for later resale for economic development purposes shall be considered a public purpose in accordance
with subdivision 8 for a period not to exceed nine years.." Anoka County 2013 value is $31,600 resulting in
2013 taxes of $659 in which $309 would come back to the City. The EDA has three options:
1. Stmt marketing this site for redevelopment and pay taxes
a. If sold for redevelopment CDBG national objects will need to be met or the market value
will have to be paid back to Anoka County.
2. Keep the site as is and start paying taxes on the site until ready to market.
3. Dedicate the lot as park land to permanently use as a community garden or green space, which will
maintain the tax exempt status. However, this will trigger the need to pay back CDBG funds to
Anoka County ($31,600).
Due to the small net amount in taxes plus the cost to repay CDBG funds, staff recommends option #2 using Fund
420.
Questions from members:
Peterson agrees with staff's recommendation to go with option 42. Nawrocki said it was originally intended to be
used by the Library. Cartney explained that if we turned it into a parking lot for the Library that we would have
to pay back the CDBG fiords in the amount of $31,600 to Anoka County as it doesn't meet the national
objectives. Staff checked on this when the Accountant wanted to purchase the lot a year or so ago.
EDA Minutes
Page 13
August 6, 2012
Motion by Diehrn, seconded by Peterson, to keep the parcel as a cormnunity garden and pay taxes until the EDA
is ready to market the lot for sale. All ayes. MOTION PASSED,
11. Administrative Report
There were no further reports.
The next regular EDA meeting will be Tuesday, September 4, 2012 at City Hall at 6:30 pm. Dielun
stated she will not be at that meeting.
The meeting was adjourned at 9:05 pm.
Respectfully submitted,
Shelley Hanson
Secretary
ECONOMIC DEVELOPMENT AUTHORITY (EDA)
MINUTES OF THE SPECIAL MEETING OF
SEPTEMBER 17, 2012 IN CONFERENCE ROOM 1
The meeting was called to order at 6:00 pm by Chair Peterson.
Members Present: Bruce Nawrocki, Gary Peterson, Donna Schmitt, Gerry Herringer, and
Tammera Diehm, and Marlaine Szurek.
Members Absent: Bobby Williams
Staff Present: Walt Fehst, Scott Clark, Sheila Cartney, and Shelley Hanson.
Also present was: Bob Lindahl from Kennedy & Graven Law Office.
PLEDGE OF ALLEGIANCE- RECITED
The meeting was adjourned to an Executive Session to discuss a Purchase Agreement for 3919 -3927
Central Ave.
After some discussion it was decided to hold the next EDA meeting on Monday October 8, 2012 at
City Hall.
The special meeting and Executive Session were adjourned at 6:52 pm.
Respectfully submitted,
Shelley Hanson
Secretary
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meeting of: November 5, 2012
AGENDA SECTION: Consent
ORIGINATING
EXECUTIVE
NO: 3a
DEPARTMENT: EDA
DIRECTOR
APPROVAL
ITEM: Financial Report and Payment of Bills
BY: Sheila Cartney
BY:
DATE: July 17, 2012
BACKGROUND:
The Financial Reports are for the month of July, August and September 2012 and Resolution 2012 -14 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 Reports and approve the payment of bills.
RECOMMENDED MOTION:
Move to waive the reading of Resolution 2012 -14 there being ample copies available to the public.
Move to approve Resolution 2012 -14, Resolution of the Columbia Heights Economic Development
Authority (EDA) approving the Financial Statements and Payment of Bills for the month of July, August
and September 2012.
Attachments: Kesmunon ana
EDA ACTION:
EDA RESOLUTION 2012 -14
RESOLUTION OF THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
(EDA) APPROVING THE FINANCIAL STATEMENTs FOR JULY, AUGUST AND SEPTEMBER
2012 AND PAYMENT OF BILLS FOR THE MONTHS OF JULY, AUGUST AND SEPTEMBER
2012.
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, August and September 2012 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 51h day of November 2012
MOTION BY:
SECONDED BY:
AYES:
President
Attest By:
Shelley Hanson, Secretary
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COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meeting of November 5, 2012
AGENDA SECTION: Business Item
ORIGINATING
EXECUTIVE
NO:4
DEPARTMENT: EDA
DIRECTOR
APPROVAL
PfEM: Grand Central Loft Town Homes
BY: Sheila Cartney
BY:
Proposal — 4800 Grand Ave
DATE: October 25, 2012
BACKGROUND:
In 2003, a development plan was approved for three 60 -unit condo buildings and 21 townhouses as part
of the Grand Central Lofts Agreement. Currently there are 10 townhouse units built and one condo
building. The townhouses are platted as individual lots with zero lot line setbacks. This proposal would
be part of phase two of the townhouse portion of the development that is unfinished at this time.
PROPOSAL: The applicant is proposing to reduce the number and style of townhouse units. The
approved unit number was 21 with 10 built and 11 remaining units /lots. The applicant proposes to
reduce the number to 9 and create detached single family homes instead of attached townhomes. The
proposed lots will be slightly larger than what was previously approved at 3,150 square feet (original is
2,460sq. ft.). The proposed single family homes will have similar architecture and earth tones to
complement the existing buildings and will be part of the Home Owner's Association.
These changes constitute a preliminary and final plat, and site plan review approval. The changes to this
proposal are minor in nature and are before the EDA in order to determine if the proposal still meets the
spirit and intent of the original development.
RECOMMENDATION: Staff recommends the proposal move forward to the Planning Commission
and City Council for Preliminary plat and Site Plan Review as proposed.
RECOMMENDED MOTION:
Motion: The EDA affirms that the proposed modifications meet the spirit and intent of the original
Grand Central Townhouse Proposal based upon successful review by the Planning Commission and City
Council.
Attachments: Narrative, Site plaii, original plat, proposed etevations
EDA ACTION:
Proposal: Cottages at Grandview
Tier 2 & affiliates seek to re -plat the 11 existing townhome
pads and abutting outlet into 9 single family detached
homes.
Similar to the existing 11 vacant townhome lots, the 9 new SF
lots would participate in the existing association's common
elements (proportionate to the 11 lots share). Similar to
typical SF homes, exterior & lot maintenance would be the
responsibility of the homeowner.
The Proposed Lots:
• Proposed lot size is 45' x 70'. These lots are generally
consistent with the existing townhome pads. Since
the townhome pads were platted to the rear wall
line, the SF lots are 7' +/- deeper to accommodate
rear lot space (i.e. patio).
• Proposed side yard setbacks = 5' on both sides
(10' between units)
• Proposed pads /home dimensions —will vary per plan,
but generally 32 -35' wide X 63' +/- deep
• Proposed homes (with prelim engineering review)
will likely be able to take advantage of existing
sewer /water stubs.
Photos to Right:
• Top: Concept plan layout (with existing plat lines
below proposed)
• Middle: Concept home front elevation (color
packages in earth tones to complement existing lofts
& townhome buildings). Note general use of
architectural accents.
• Bottom: Main & 2nd floor plans
FRONT E!F-VATION
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---------------
MAIN FLOOR — ____._ .......... _
SECOA'J FLOOR
General Benefits:
Consistent with our discussion with City staff, Tier 2 believes
several benefits exist to the City & the HOA — including:
• Vacant, distressed lots built & occupied
• SF homes differentiate from existing product ( & limit
oversupply)
• Proposed lots are generally typical of other city lots
• Completed units will more fully contribute to the
Homeowners Association and City tax base.
• Market based solution to distressed property not
seeking outside subsidy or City participation.
About The Applicant :
Tier 2 Funding is a locally owned & operated real estate
investment firm. Through relationships with affiliates, the
company is vertically integrated to provide the following
activities: land development, financing, home construction,
building products, mortgage financing, & realty services.
Tier 2 & its affiliates have a history of successful development
& construction. The company currently owns lots in
Woodbury, Rosemount, & Prior Lake. They use this lot
inventory for in -house homebuilding as well as resale to
individuals or builders. In addition to multi -lot developments,
they also build homes on individual lots.
Photos to Right :
• Top: Sample home Tier 2 /Regal in Burnsville (200
Krestwood Blvd)
• Middle: Sample homeTier2 /Regal in Minneapolis
(3310 E. 54`x' St.)
• Bottom: Sample project -12 lots in Prior Lake
(Jeffer's)
Next Steps :
If the City is generally supportive of the proposed concept, Tier 2 will move toward the following activity:
• Workwith City staff to prepare & submit a formal preliminary plat
• Work with the existing Homeowners Association to address questions and facilitate the concept
• See final plat approval & plan for construction start this coming March /April.
Cottages at Grandview
Concept Overview
Nov. 5 ". 2012
Summary of Request:
As the City is aware, portions of the Grand Central Loft
project has been distressed for some time. This past
summer, Tier 2 & its affiliates contracted 11 finished,
developed townhome lots abutting the Grand Central Lofts
project. Over the past 2 months, Tier 2 has met several times
with City staff to review & discuss the proposed concept of
re- plating the property to 9 single family detached lots.
Tier 2 seeks general feedback in support of the concept. If
provided, the intent is to work with City staff & the HOA to
move toward a formal application for re -plat of the property.
Existing Conditions :
Separate from the condo /loft portion of the original project,
21 townhome pads were approved & platted. Of these 10
townhomes were built prior to the remaining 11 pads falling
into a distressed status. Due to dramatic shifts in market
demand & overall conditions these pads have sat vacant for
several years.
Given market conditions, location, demographics, & area
supply /demand, it is unlikely the market will support
construction of additional attached townhome units in the
foreseeable future on this site.
Photos to Right :
• Top: Aerial view of project area
• Middle: Existing 4 unit building
• Bottom: Existing 2 unit building
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MAIN FLOOR PLAN
SECOND FLOOR PLAN
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meeting of November 5, 2012
AGENDA SECTION: Business Item
ORIGINATING
EXECUTIVE
NO:5
DEPARTMENT: EDA
DIRECTOR
APPROVAL
ITEM: Scattered Site Real Estate RFP's
BY: Sheila Cartney
BY:
DATE: October 23, 2012
BACKGROUND:
At the August 2012 EDA meeting the EDA directed staff to prepare an RFP for real estate services for the
scattered site lots. Staff prepared the RFP and sent it to the St. Paul Association of Realtors and advertised on the
City's webpage. To date 9 responses have been received. Below is a summary of the responses in no particular
order.
1) Bruce Magnuson — Edina Realty, licensed realtor since 2005.
*Has lived in Columbia Heights for 42 years and has participated in several civil activities.
• Sold 15 properties in Columbia Heights
• Magnuson is also collaborating with a developer to purchase the lots for development
*Marketing Plan
• MLS listing
• Sign installation
• Listing on Facebook and Craigs List
• Listing on EdinaRealty.com then fed to other websites
o Website stats emailed to seller
o Review trends in marketplace
*Fee Schedule
0 7.3% per lot
0 2.7% to selling broker
0 10% Total
2) Darcy Gedney- Peoples Realty, licensed realtor since 2002.
• Has worked and lived in Anoka County for over 20 years
• Marketing Plan
• MLS listing
• Sign installation
• Advertise all properties on multiple webpages
• Communication is key
*Fee Schedule
0 4.5% per lot (total)
0 2.7% commission to buyer
o Administration fee of $250 per closing
3) Jason Borowitz - tisllMLS Realty, licensed realtor since 2001.
*Has worked in Anoka County for 7 years
• Marketing Plan
• MLS listing
• Sign installation
• Real Estate Magazine
• Provide a marketing report every 21 days
M
*Fee Schedule
5% Per lot or minimum of $2,000
2.5% per lot or $1,000 minimum to cooperating broker
4) David Bichanga —Re/Max Results -Klick Team, Reo Group, licensed since 2005
• Has sold 4 single family homes in Columbia Heights and 9 in Anoka County
*Has experience with governmental agencies
•Marketing Plan
• MLS listing
• Internet exposure on Google and Yahoo
• Personal promotion to other agents
• Sign installation
• Advertise in local Newspaper
• Fee Schedule
0 3% of the lot price or minimum of $1000
5) Myrna Bourcy — Re /Max Results, licensed since 1991
• Re /Max is the number one real estate seller in Anoka County
• Marketing Plan
• MLS listing
• Sign Installation
*Fee Schedule
8% per lot
6) Eric Young — Edina Realty/Young Real Estate Inc., licensed since 2004
• Worked with a builder who has built and sold 4 new single family homes in the last five years in
Columbia Heights
*Realtor for Grand Central Lofts and Parkside Village
• Past experience working with governmental entities
• Marketing Plan
o MLS listing
o www columbial- IeightsReal .con
o Listing on other webpages
• Fee Schedule
0 4.7% of sales price of the lot
7) Chris Kimball — Best Value Real Estate Inc., licensed since 1987
• Columbia Heights resident for 15 years
• Owner and Vice President of Vanderbilt Homes Inc., a licensed home builder
*Past experience working with governmental entities
• Marketing Plan
• MLS listing
• Sign installation
*Fee Schedule
• Using a co -op broker, a commission of 5% would be charged, Best Value to offer a
2.7% buyer - broker commission and retaining 2.3%
• Not a co -op transaction and Best Value represents both buyer and seller, a 4%
commission would be applicable.
8) AlneriBld — Auctioneers
• Auction properties on November 30 °i
2 Scattered Site RFP
•Estimated selling price of lots range from $6,000 - $24,000
• Marketing Plan
• Sign installation
• Print media and direct mailing
• Digital media
*Fee Schedule
o Marketing Plan: $4,718.98
0 10% buyer's premium added to high bid and becomes part of the total purchase price
AlnerlBid retains the 10%
9) Patti Ann Kaspe — Exit Realty Nexus, license since 2005
• Experience in Anoka County
• Marketing Plan
o MLS listing
• Buildhere.us magazine
• Stand -alone website
• Sign installation
• Various other internet pages
*Fee Schedule
• Listing agent services $700 per lot
• Regulatory Compliance Broker Admin fee $395 per lot
• Buyer Broker or Buyer Agent compensation 2.5% of gross lot sale price
Staff suggests that the EDA narrow down the candidates to three and conduct interviews at the next EDA
meeting. Staff recommends Bruce Magnuson, Edina Realty; Eric Young, Edina Realty /Young Real Estate
Inc.; and Chris Kimball, Best Value Real Estate Inc. All three of these candidates have experience in
Columbia Heights, with builders and government. All RFP's received are available in the Community
Development office for review, because of the quantity and documentation type staff is not including the
RPF's in the packet.
RECOMMENDATION: Staff recommends that the EDA narrow down the candidates to three and conduct
interviews at a later EDA meeting. Staff recommends Bruce Magnuson, Edina Realty; Eric Young, Edina
Realty /Young Real Estate Inc.; and Chris Kimball, Best Value Real Estate Inc.
RECOMMENDED MOTION: Move to authorize staff to schedule interviews for the December 3, 2012 EDA
meeting with Bruce Magnuson, Edina Realty; Eric Young, Edina Realty /Young Real Estate Inc.; and Chris
Kimball, Best Value Real Estate Inc.
EDA ACTION:
3 Scattered Site RNP
COLUMBIA 1IEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meeting of: November 5, 2012
AGENDA SECTION: Business Items
ORIGINATING
EXECUTIVE
NO:6
DEPARTMENT: EDA
DIRECTOR
APPROVAL
ITEM: Donation 666 40 °i Ave — Resolution 2012 -15
BY: Sheila Cartney
BY:
DATE: October 24, 2012
BACKGROUND:
In late 2008 the Mayor received a letter from Michael Thoennes, property owner of 666 40 °i inquiring if the City
would be interested in receiving this property as a donation. Since receipt of that letter (attached) staff has worked
with Thoennes' attorney Charles Pashke on obtaining ownership documents. It wasn't until September 2012 that
those documents were presented to staff. The property is zoned Limited Business and is vacant.
In August 2011, Fire Department staff secured the property as it had been broken into and revealed that water, was
turned on and flooded the basement. The Building Official posted the property as hazardous in September 2011. In
the meantime the subject property has continued to physically decline and staff recommends demolition. This
property has historically been used as a "cut- through" to Huset Park, staff suggests that the city use this property as
an informal access to the park once the demolition is complete.
This property was previously used as a dental laboratory; therefore staff recommends that before the EDA accept
the donation a pre demolition survey be conducted on the site to see if there are any unforeseen contaminants. Staff
also recommends using the City's attorney to draft the purchase agreement and the Quick Claim Deed.
It is anticipated that the survey and demolition work will cost approximately $10,000.00 and will be funded
through fund 376 (C8 TIF district).
RECOMMENDATION: Staff recommends the EDA accept the donation of 666 40 °i Ave as long as there are no
major contaminants revealed in the pre - demolition survey.
RECOMME, LADED MOTION:
Motion: Move to waive the reading of Resolution 2012 -15, there being ample copies available to the public.
Motion: Move to approve resolution 2012 -15 authorizing acceptance of the donation of the property located at 666
40 °i Avenue Northeast in the City of Columbia Heights; furthermore allowing the City Manager to enter into any
agreements for the same.
Attachments: Letter dated December 23, ZUUZS. Kesolutlon ZVIZ -1 J, Uoullty valve
EDA ACTION:
FDA RESOLUTION 2012 -15
RESOLUTION AUTHORIZING THE ACCEPTANCE OF THE DONATION OF THE
PROPERTY LOCATED AT 666 40TH AVENUE NORTHEAST
IN THE CITY OF COLUMBIA HEIGHTS
WHEREAS, the property owner Michael Thoennes desires to donate the property located in Columbia
Heights at 666 40 °i Avenue, legal description of Lot 45 & 46 Columbia Heights Annex Subject to
Easement of Record, Anoka Comity Minnesota; and
WHEREAS, the confirmation of the desire to donate the subject property has been received by the City
in a letter dated December 23, 2008; and
WHEREAS, accepting the donation and removing the building is consistent with the EDA's 2011-2012
Goals and Work plan of Sustaining Residential neighborhoods; and
WHEREAS, the property will be used as an informal park access to Huset Park; and
WHEREAS, the EDA is recognizing the donation through a formal resolution; and
WHEREAS, Closing costs, demolition, and related costs shall be paid by fund 376.
NOW THEREFORE BE IT RESOLVED, that the EDA accepts the subject donation based on the
following:
1) All utilities are paid by the subject property owner by the date of closing
2) The EDA will be responsible for any taxes due and payable in 2013 and beyond
3) The building shall be vacant upon closing
4) Staff is authorized to prepare bids and documents for the purpose of demolition of the subject
property.
Passed this 5 °i day of November 2012
President Peterson
Attest: Shelley Hanson, Secretary
December 23, 2008
Mayor City of Columbia Heights
590 -40th Avenue NE
Columbia Heights, MN 55421
Dear Mayor Peterson:
For many years I have owned the dental laboratory property at 666 -40th
Avenue NE in Columbia Heights. It is a very old building at the "T"
intersection of Madison and 40th Avenue NE. The building is no longer
being used by my dental laboratory. The property has served many years
also as a pathway or "shortcut" between Huset park and 40th Avenue NE.
I am not complaining, just making an observation that the south side block
is very long to get to the park via city sidewalks or streets, thus the
shortcut.
In any event, I am in the process of selling the property but would consider
a "gifting of the land and building" to the City of Columbia Heights.
Basically there would be no strings attached except the transfer of the
property and building as is after I move the equipment out.
Do you think there would be any interest of the park commission or City in
this kind of proposition? The timeframe would probably be in the
spring /early summer.
Sincerely,
Michael J. Thoennes, DDS
A WC1COale to the lveb site dAnoka County
fvfiuneeata
Property Details
Values
Page 1 of 1
Property ID 35- 30- 24 -42; 0099 Situs Address 666 40TH AVE NE ,COLUMBIA HEIGHTS, MN 55421 -0000 _�
Developed by Manatron, Inc.
@2010 All rights reserved.
Version 1.0.4581.14247
https :// starlite. co .anoka.mn.tis /030cgv2tLiegzcd25l c2l ge55) /pareelinfo.aspx 9/28/2012
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meeting of: November 5, 2012
AGENDA SECTION: Business items
ORIGINATING
EXECUTIVE
NO:7
DEPARTMENT: EDA
DIRECTOR
APPROVAL
ITEM: Anoka County Levy
BY: Scott Clark
BY:
DATE: October 29, 2012
BACKGROUND: On August 6, 2012 staff presented an in -depth EDA letter to the Coin inissioners, which
included historical documents, regarding the subject issue. Based on the rules of engagement with Anoka County,
if there is no formal action to deny the next five -year finding cycle, then the levy is automatically continued. If the
EDA agrees to continue, staff recommends that the City Council affirm the same through a Council resolution.
At the last meeting it was asked as to how we can use these finds. Within the most general perspective, any
activity that the City's EDA or I -IRA can legally enter into by means of State law, is an eligible activity. This
means that any bonafide economic development program, marketing, housing programs, redevelopment
activities can be funded. The funds cannot be used for general governmental expenses and salaries. The only
caveat is that the Anoka County HRA, which oversees these activities, must agree to the same that these are
"authorized" activities. In other words, their purview is not policy but eligibility. More specifically, we could
use these funds to expand into programs that we do not have such as a business retention loan ( this was an
activity that CDBG funds were applied for and not approved in 2012), the City could look at a different rehab
loan program which could include more residents, the EDA could buy and lease some of the small existing
commercial buildings for specific uses, the money could be saved towards a major redevelopment land
purchase, some cities have moved towards having the EDA fund small business consultants for advice, etc. Staff
is not recommending any of these programs at this time, but the list is to gain a flavor of activities that the City
could expand into and have a resource to match the expenditure. From an economic development perspective,
this city is going through a major shift, moving from a past industrial /service base to a pure service based
economy. A significant amount of new businesses are first time start -ups, and time and energy should be spent
on how we ensure their success and equally, to identify other opportunities that the market is not presently
recognizing (such as the restaurant /art /entertainment success of northeast Minneapolis). Lastly, as stated before,
these dollars should be viewed in terms of both the now and the future. This levy provides another mechanism to
build some additional sources of revenue for future needs as the challenges of an aging community will
guarantee that additional resources will be necessary to bolster residential and /or commercial neighborhoods.
RECOMMENDATION: Staff recommends continuation of the Anoka County Levy for an additional five
years.
RECOMMENDED MOTION: Motion: Move to authorize staff to submit a letter of acknowledgement to
Anoka County that the City will continue with the Anoka County Economic Development Levy.
Attachments: City County Resolution 2007 -156, EDA Letters of August 28.2007 and August 6, 2012, Anoka County levy Fund 202
EDA ACTION:
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA)
Meeting of: August 6, 2012
AGENDA SECTION: Business Items
ORIGINATING
EXECUTIVE
NO:9
DEPARTMENT: EDA
DIRECTOR
APPROVAL
ITEM: Anoka County Levy
BY: Scott Clark
BY:
DATE: July 22, 2012
BACKGROUND: In 2007 both the Economic Development Authority and the City Council entered
into discussions and approved participating with the Anoka County Housing and Redevelopment
Authority, for five years, to levy a tax for economic development purposes. Attached is the August 28,
2007 EDA report and City Council Resolution #2007 -156 which will give the rationale for the
participation. At that time, it was calculated that the total five year allocation would be approximately
$1,285,776 minus the County's administration fee of 15% (the final net number would be
$1,092,250). However, the total net anticipated allocation from years 2008 -2012 is only $937,524
since the levy amount is driven by State formula and is calculated based on City marketable tax value,
which has decreased greatly over the past 5 years.
Attached is a spread sheet showing the obligated and unobligated funds for the 2008 through 2012
allocations. The majority of the funds were previously dedicated to the purchase of the " Mady's
Property" as part of a large redevelopment action, but the offer to purchase the property was rescinded
by the owner.
The Anoka County levy program is a rolling five year program which means that the City /EDA has to
either (1) Agree to be part of the program for another five years ( years 2013- 2017 with an estimated
total net allocation of $850,000 ($170,000 annualy) or (2) Not re -up and forfeit the opportunity to
participate for the full five year cycle. The policy question for the EDA is their desire, or not, to use
this program as a future source for redevelopment, housing and /or economic development programs.
The EDA has limited resources for future activities and this allocation provides another tool for
activities that could be halted due to a lack of funds. From a staff perspective, the lack of currently
having a specific program attached to these funds should not be a rationale for not continuing with the
levy program. As the City ages, new issues and hopefully opportunities, will present themselves for
public assisted reinvestment. As stated previously, these funds can't be generated at a future date nor
are they characterized as grant funds that could be applied for when needed. The funds can be viewed
as creating a fund balance towards future expenditures that are consistent with an aging community
and match the goals of the City. Examples of future use could be purchasing or assisting in a major
redevelopment effort (such as a Mady's type project) or a loan program that would leverage these
funds and allow access to a greater range of income levels.
According to Anoka County, if the City desires to proceed with a new five year allocation no new
resolution has to be passed and the extension is automatic. If the City elects not to pursue this funding
levy a letter should be forwarded regarding the same.
RECOMMENDATION — staff views that as an aging community the EDA should avail themselves
to whatever funding sources that they can for future projects. As stated in the 2007 report, if an EDA
has a future project that is critical these funds can serve as an alternative to bonding, reducing the
EDA's current redevelopment funds and /or the need to seek funding from other sources. Many first
ring suburbs have compiled significant levels of redevelopment fund balances from old tax increment
districts and this City has not had that luxury, meaning that building fund balances for redevelopment
efforts needs to come from whatever sources can be found. That being said staff recommends
continuing with the five year program.
RECOMMENDED MOTION: Motion: Move to authorize staff to submit a letter of
acknowledgement to Anoka County that the City will continue with the Anoka County Economic
Development Levy.
Attachments: Spreadsheet of fiords, 2007 -156 resolution, staff report dated August 28, 2007
EDA ACTION:
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
Meeting of: August 28, 2007
AGENDA SECTION: Business Items
ORIGINATING DEPARTMENT:
CITY MANAGER'S
NO: 7
Community Development
APPROVAL
ITEM: Anoka County Housing &
BY: Robert Streetar
BY:
Redevelopment Authority
DATE: August 24, 2007
Economic Development Activities
This memo presents EDA Commissioners with an offer from the Anoka County Housing and
Redevelopment Authority (ACHRA) to participate in ACHRA economic development activities.
Commissioners are asked to make a recommendation to the City Council. If Commissioners
recommend participating, the recommendation will be forwarded to the City Council at their
September 10th meeting for action. If not, no further action is required.
Should the City participate in the ACHRA economic development activities?
BACKGROUND:
Should the City participate in the ACHRA Economic Development Activities?
For background on the ACHRA's offer, please read the executive summary on pages 2 -4 of the
Report of the Anoka County Economic Development Exploratory Committee that is attached.
Analysis
To participate the City Council must pass a resolution to "opt in" to the ACHRA economic
development activities. If the City chooses to participate, it must participate for a minimum of
five years, after which time the City may choose to "opt out." Should the City choose to
participate the ACHRA would levy a tax in Columbia Heights each year the City participated. If
the City chooses not to participate it must wait five years before it may choose to "opt in."
As Commissioners know, the City is faced with many redevelopment and housing challenges,
which will continue to present themselves long into the future. Redevelopment and improving
the housing stock renews, and revitalizes the City, but it requires sufficient investment of public
resources.
By participating, the City would have additional resources to invest in these imrortant priorities.
Redevelopment projects such as 37th and Central, 39th and Central, and 40 h and University
could benefit from these additional resources, as federal, state and regional resources have
been declining or flat. It also means the City may not have to establish as many TIF districts, or
may result in TIF districts with shorter terms, thereby ensuring the new taxes from
redevelopment are placed on the tax roles sooner.
In addition to increased resources for redevelopment and housing priorities, the City could also
use all or part of the levy to pay for costs related to redeveloping the Heritage Heights site for
the new public safety facility and /or a community center.
For example, over the next fives years the ACHRA would probably levy a minimum of
$1,021,245, or about $205,000 annually. If the City used all of the levy proceeds to reduce the
annual debt service on the general obligation bonds to fund the acquisition, demolition and
relocation costs required to make the site ready, the interest savings are estimated to be about
$975,000, on a 25 -year issue at 5.25 %.
Also, using the levy proceeds would reduce the amount of general obligation debt, thereby
preserving the city's debt capacity for other needs such as public safety, or public works. The
table below estimates the minimum and maximum the ACHRA could levy, and the cost to
homeowner with a home with an estimated market value of $200,000.
2008 2009
Minimum Levy* 196,24 $200,166
Cost ** $30.20 $30.51
Maximum Levy 247,07 $252,014
3
Cost ** $38.03 $38.42
2010 2011 2012 1 Total
$204,169 $208,252 $212,417
$30.82 $31.13 $31.44
$257,054 $262,195 $267,439
80 $39.19 $39.58
*As determined by the ACHRA, * *Estimated Market Value of Home - $200,000
$1,021,245
$154.10
$1,285,776
$194.02
In summary, the ACHRA is offering the City of Columbia Heights the opportunity to participate
in the ACHRA economic development activities. This could provide additional resources for
redevelopment and housing related activities, as well as reduce the cost of a public safety
facility and /or community center. The cost of participating is estimated to be $30 to $40
annually. The Commissioners are asked to make a recommendation to the City Council to be
acted upon at the September 10 City Council meeting.
Karen Skepper, Anoka County Community Development Managerwill be present to answer any
questions.
RECOMMENDATION: Staff recommends commissioners discuss and make a
recommendation to City Council to participate or not in the ACHRA Economic Development
Activities.
RECOMMENDED MOTION: None
Attachments
EDA ACTION:
CITY OF COLUMBIA HEIGHTS RESOLUTION 2007 -156
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 local job 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 _ day of , 2007
MOTION BY:
SECONDED BY:
AYES:
NAYS:
Mayor- Gary L. Peterson
Attest by
Patricia Muscovitz, Deputy Clerk /CIAP
EDA Minutes
Page 10
August 6, 2012
been contacted since then (option 3). Regardless of what option the EDA decides to go with staff
recommends using the established guidelines for all the lots. Staff recommends the Board give approval
to send out RFPs to various Realtors and see what they propose. The RFPs will ask them to submit
their contacts, background, credentials and the amount of Commission they will charge to market the
lots for us.
uestions from members
Sclmnitt asked about the possibility of selling the lots to neighboring properties. Fehst said he'd rather
see the lots marketed for construction of new homes. This way we would recoup some of our expenses
and it would generate more tax dollars through the years. Cartney said the lots would have to be taken
out of the TIF District in order to do that. It was noted that if these empty lots were combined with
another lot that it would generate much less tax dollar revenues.
Nawrocki thought the goal should be to try and recuperate some of our costs associated with buying
these properties and demolishing the structures.
Clark said the EDA knew it would take some time to sell the lots for new construction, and we must try
different ways to market them to meet this goal.
Herringer asked if they would fall under the" 9 year rule" for paying taxes on them. Clark told him,
yes.
Schmitt liked Option 2, plus she suggested putting up "For Sale" signs on the 4 properties we are
focusing on currently. She also stated that when we get the RFP's back from the Realtors that we
should be able to negotiate the amount of commission and that a list of all the lots should be included
for them to market, not just the four "select" lots. The members agreed with this direction.
9. Anoka County Tax Levy
Clark stated that in 2007 both the Economic Development Authority and the City Council entered
into discussions and approved participating with the Anoka County Housing and Redevelopment
Authority, for five years, to levy a tax for economic development purposes. Enclosed in the packet
was the August 28, 2007 EDA report and City Council Resolution #2007 -156 which will give the
rationale for the participation. At that time, it was calculated that the total five year allocation would
be approximately $1,285,776 minus the County's administration fee of 15% (the final net number
would be $1,092,250). However, the total net anticipated allocation from years 2008 -2012 is only
$937,524 since the levy amount is driven by State formula and is calculated based on City marketable
tax value, which has decreased greatly over the past 5 years.
Also enclosed was a spread sheet showing the obligated and unobligated funds for the 2008 through
2012 allocations. The majority of the funds were previously dedicated to the purchase of the "Mady's
Property" as part of a large redevelopment action, but the offer to purchase the property was
rescinded by the owner.
EDA Minutes
Page 11
August 6, 2012
The Anoka County levy program is a rolling five year program which means that the City /EDA has
to either (1) Agree to be part of the program for another five years (years 2013- 2017 with an
estimated total net allocation of $850,000 ($170,000 annually) or (2) Not re -up and forfeit the
opportunity to participate for the full five year cycle. The policy question for the EDA is whether or
not to use this program as a future source for redevelopment, housing and /or economic development
programs. The EDA has limited resources for future activities and this allocation provides another
tool for activities that could otherwise be halted due to a lack of funds. From a staff perspective, the
lack of a specific program attached to these funds should not be a rationale for discontinuing the levy
program. As the City ages, new issues and hopefully opportunities, will present themselves for public
assisted reinvestment. As stated previously, these funds can't be generated at a future date, nor are
they characterized as grant funds that could be applied for when needed. The funds can be viewed as
a means to create a fund balance towards future expenditures that are consistent with an aging
community and match the goals of the City. Examples of future use could be purchasing or assisting
in a major redevelopment effort (such as a Mady's type project) or a loan program that would
leverage these funds and allow access to a greater range of income levels.
According to Anoka County, if the City desires to proceed with a new five year allocation no new
resolution has to be passed and the extension is automatic. If the City elects not to pursue this funding
levy a letter should be forwarded regarding the same.
Staff views that as an aging community the EDA should avail themselves to whatever funding
sources that they can for future projects. As stated in the 2007 report, if an EDA has a future project
that is critical these funds can serve as an alternative to bonding, reducing the EDA's current
redevelopment funds and /or the need to seek funding from other sources. Many first ring suburbs
have compiled significant levels of redevelopment fund balances from old tax increment districts and
this City has not had that luxury, meaning that building fund balances for redevelopment efforts
needs to come from whatever sources can be found. That being said staff recommends continuing
with the five year program.
Questions from Members:
Nawrocki strongly opposed continuing with this program. He feels this is a deceptive way to collect
additional tax dollars from our residents and that $125,000 is taken off the top by Anoka County. He
said if additional funds are warranted for redevelopment efforts then raise the taxes to do so, and not
go through this process which hands over funds to the County that could be used by the City.
Fehst agrees with Nawrocki to a point on how it's done. However, we have no other way to get
money for redevelopment projects, and if we don't have funds in place, then we cannot take action on
properties that may become available to us for improvement. There was a brief discussion about the
options we have to increase levy amounts that would provide funds without continuing with this
particular program.
EDA Minutes
Page 12
August 6, 2012
Diehm questioned whether we will still have an HRA levy once Parkview Villa is sold. Clark stated
that, yes there will still be an HRA levy and a HRA Commission since we deal with other housing
issues and programs other than just Parkview Villa. The levy structure won't be changed after the
sale. Diehm then asked how soon we have to make a decision on this matter. Clark told her by
October. She then suggested tabling this until the next meeting so that more information can be
reviewed in regards to potential target areas, additional tax levy options, and current fund balances.
Motion by Schmitt, seconded by Herringer, to bring this item back at the September meeting. All ayes.
MOTION PASSED.
10. 828 40a' Avenue Tax Exemption Status
In 1999 the EDA purchased property at 828 40 °i Ave with an old TV repair building on the lot. In 2001 the
building was torn down leaving a vacant green space. Community Development Block Grant (CDBG) money
was used for the purchase and demolition. The purchase price was $72,246.50 and demolition was $7,117.20 a
total of $79,363.70 of CDBG funds used. After purchase of the lot, the property was placed into tax exempt
status.
For the past three years the subject lot has been used as a community garden and in 2011 the EDA turned down a
proposal to sell the subject lot for a parking lot proposal for an adjacent accounting firm. It was also at that time
that Anoka County explained national objective needs to be met or the city would need to pay back some of the
CDBG funds (market value not the total funds used).
Based on a letter dated January 23, 2012 from Anoka County, as of December 31, 2012 the subject lot will no
longer be tax exempt. State Statute 272.02 Subd. 39 states "The holding of property by a political subdivision of
the state for later resale for economic development purposes shall be considered a public purpose in accordance
with subdivision 8 for a period not to exceed nine years.." Anoka County 2013 value is $31,600 resulting in
2013 taxes of $659 in which $309 would come back to the City. The EDA has three options:
1. Start marketing this site for redevelopment and pay taxes
a. If sold for redevelopment CDBG national objects will need to be met or the market value
will have to be paid back to Anoka County.
2. Keep the site as is and start paying taxes on the site until ready to market.
3. Dedicate the lot as park land to permanently use as a community garden or green space, which will
maintain the tax exempt status. However, this will trigger the need to pay back CDBG funds to
Anoka County ($31,600).
Due to the small net amount in taxes plus the cost to repay CDBG funds, staff recommends option 92 using Fund
420.
Questions from members:
Peterson agrees with staff's recommendation to go with option #2. Nawrocki said it was originally intended to be
used by the Library. Cartney explained that if we turned it into a parking lot for the Library that we would have
to pay back the CDBG funds in the amount of $31,600 to Anoka County as it doesn't meet the national
objectives. Staff checked on this when the Accountant wanted to purchase the lot a year or so ago.
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