HomeMy WebLinkAboutEDA MIN 06-23-14
ECONOMIC DEVELOPMENT AUTHORITY (EDA)
MINUTES OF THE SPECIAL MEETING OF
JUNE 23, 2014 IN CONFERENCE ROOM 1
The meeting was called to order at 5:35 pm by Chair Peterson.
Members Present: Bruce Nawrocki, Donna Schmitt, Marlaine Szurek, Gary Peterson, Tami
Diehm, and Gerry Herringer. Bobby Williams arrived at 5:40 pm
Staff Present: Walt Fehst and Shelley Hanson.
Legal Counsel: Martha Ingram, Kennedy and Graven
2. PLEDGE OF ALLEGIANCE-
RECITED
3CONSENT ITEMS
.
1.Approve the Minutes from June 2, 2014.
2.Approve the Financial Report and Payment of Bills for May 2014 on Resolution 2014-05.
Questions by Members:
Nawrocki questioned the payment to the MN Board of Cosmetology. Hanson told him it was for
the Salon license renewal at Parkview Villa. He had other questions, but due to the time
constraints on the meeting he was asked to contact Community Development staff directly for the
answers regarding payment of bills.
Motion by Diehm, seconded by Schmitt, to waive the reading of Resolution 2014-05, there
being an ample amount of copies available to the public. All ayes. MOTION PASSED.
Motion by Diehm, seconded by Schmitt, to approve the consent agenda items as presented. All
ayes, with exception of Nawrocki who abstained. He couldn’t vote to approve without the
answers to all his questions. MOTION PASSED.
EDA RESOLUTION 2014-05
RESOLUTION OF THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
(EDA) APPROVING THE FINANCIAL STATEMENT FOR MAY 2014 AND PAYMENT OF BILLS
FOR THE MONTH OF MAY 2014 .
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
Page 2
June 23, 2014
WHEREAS,
the financial statement for the month of May 2014 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 23rd day of June, 2014
MOTION BY: Diehm
SECONDED BY: Schmitt
AYES: All ayes with
Nawrocki abstaining __________________________________
President
Attest By:
______________________
Shelley Hanson, Secretary
NEW BUSINESS
4. Huset Park Contract for Private Development – Sixth Amendment
BNC Bank, the current owner of the undeveloped parcels at the Huset Park development, has requested
to amend the Contract for Private Development that regulates land use for Huset Park. At the June 2
Economic Development Authority (EDA) meeting, the EDA voted to approve Amendment Six to the
Contract that revised the development completion schedule. The EDA tabled the request to amend the
“Minimum Improvements” definition for Phase 1B to accommodate Habitat for Humanity’s proposal to
construct 16 townhomes on the site.
EDA Minutes
Page 3
June 23. 2014
The Minimum Improvements definition was last amended on June 23, 2008 to accommodate 80 units of
multi-family senior rental housing for Phase 1B. The real estate broker for the property has stated that
there is currently no interest in that site by senior housing developers. Several residents from the
adjacent townhome development spoke at the June 2, 2014 EDA meeting and stated their opposition to
the proposed development. Allowing 16 townhome units to be constructed in this area is consistent
with land use and zoning regulations. If the EDA were to amend the Contract for Private Development
to allow the townhomes as an acceptable use on the site, the developer would have to still obtain Site
Plan approval for the project by the Planning and Zoning Commission and the City Council.
The proposed development site, located at the southwest corner of Jefferson Street and Huset Parkway,
is approximately 1.32 acres in size. The 2015 Estimated Market Value of the site is $303,200. Taxes
for 2013 are delinquent on this property. Including interest, penalties and special costs, $18,194.10 is
owed for 2013 taxes. In addition, the first half of 2014 taxes, which were due on May 15, 2014 in the
amount of $7,229.24 have not been paid. Special assessments for this property in 2014 have been
calculated at $14,041.35. BNC Bank has stated that financial obligations would be satisfied as a
condition of the sale to Habitat for Humanity.
If the EDA chooses to deny the request to revise the Minimum Improvements to accommodate
townhomes on Phase 1B, the EDA must make findings that support retaining the current plan for 80
units of multi-family senior rental housing.
Fehst passed out a letter from Melissa Student, attorney for Habitat for Humanity warning City Officials
to restrict their discussion to the zoning and use of the property and not discuss who would be
developing it or who would be living there.
Martha Ingram, Legal Counsel, was present to answer questions from the members. She told members
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that a modified amendment to the 6 Amendment is the only question being considered tonight to
consider a language change to allow the use to be changed from Sr. Housing to townhouse construction.
She explained the extension of construction dates was approved at the June 2, 2014 meeting.
There were several people from Habitat for Humanity, a representative from BNC Bank, and Jim
McCaffrey present at the meeting to answer additional questions.
Clint Bowling from BNC said the bank has been trying to sell this property since 2011, and there hasn’t
been much interest from Developers, especially in regards to Sr. Housing. He feels the language
change would allow for construction on the site with something that would fit the area.
Williams said he thought Ryland Homes wanted to continue their project five years ago, but were
rejected as they wanted the land price reduced in order to finish the project. Bowling said that was
before BNC got the property back and they have not approached the bank with an offer to resume.
There was a discussion regarding the appraised value of the vacant piece that is the subject of
discussion. Williams stated that the Homeowner’s Association is interested in purchasing the property
so they could work with a developer of their choice. BNC said the HOA had never contacted anyone
about that until after Habitat made their offer.
EDA Minutes
Page 4
June 23, 2014
Wade Falstad who is on the Board of Directors from the Huset Park HOA stated they never made an
offer since they thought it was slated to be used as Sr Housing and therefore, didn’t see a need to do so.
If the allowed use changes then they would be interested in also making an offer for the property.
Questions/Comments from Members & Public Hearing:
Nawrocki stated that he took exception to the language of the letter from Habitat’s Attorney. He said
City Officials spent a lot of time developing a plan and getting financing in place to make a project
such as this work. He would like to stick with the plan in place for the time being since the market is
rebounding and construction is improving.
Peterson said he thinks the proposed townhouses aesthetically look like the neighboring ones built by
Ryland. He thinks these would fit in the area and would get the property back on the tax rolls.
Herringer questioned the size of the vacant lot and the number of proposed units. He asked if Habitat
would add more units to the site than what they say they are proposing now, if there is room. He was
told the proposal is for 16-20 units. Herringer then asked McCaffrey if he sees the market changing in
the next 3-5 years as the baby boomers continue to age. He said Schuette Co is looking at modifying
the NE Business Center into Sr Housing, so the market must be there. McCaffrey said that developers
aren’t interested in Columbia Heights for Sr. owner occupied or co-op housing as they are not
comfortable with the income and rents in the area. The Schuette Co. plan is geared to low income or
affordable incomes, which is different than a market rate co-op building.
Chad Dipman, Project supervisor for Habitat reiterated some of the points he made at the last meeting:
Compatible with the Comprehensive Plan—it is already zoned Mixed Use—blends in with other
townhouses in the area—he sees no reason to deny request. He also told Williams that he
represents others in the community, not just the residents in the Huset Park HOA and he should
remember his legal obligations to members of the community as a whole.
Fehst asked Dipman about the process if someone who gets one of the townhouses decides to sell it.
Dipman explained that Habitat has the first option to buy it back if they choose to do so. It would then
be sold to another party that qualifies for Habitat housing. Sometimes Habitat chooses not to purchase
them if they have too much equity and it becomes unaffordable. Some mortgages may also have
declarations/covenants which would require it to be sold to another low income party if public funds
have been used to obtain that mortgage.
Williams said it is not a decision about Habitat being the developer that is influencing his vote on this.
The City has supported Habitat for Humanity on other homes and some of the elected officials and
staff have even worked on them. The City supports affordable housing in many fashions throughout
the community. However, he thinks the development agreement is fine the way it is and is willing to
wait to see if interest eventually picks up for the plan in place.
EDA Minutes
Page 5
June 23, 2014
Mike Olson from Habitat is willing to work with the Huset Park HOA. He said if Habitat could build
10 of the units, he would let the HOA work with them on the other 6 units if they can get this
approved.
Motion by Williams, seconded by Szurek to waive the reading of Resolution 2014-04, there being ample
amount of copies available to the public. All ayes. MOTION PASSED.
Motion by Williams, seconded by Szurek to deny Resolution 2014-04, a Resolution approving the
Modified Sixth Amendment and Restated Contract for Private Redevelopment by and between Columbia
Heights EDA and BNC Bank as Successor to Huset Park Development Corporation.
There was some more discussion after the motion was made.
Herringer said we currently have 27 Habitat Homes in Columbia Heights. He said this is a hard
decision for him, and sometimes it leaves the members second guessing themselves if they have made
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the right decisions. He reflected on the fact that they turned down a proposal at 47 and Central for an
upper end market rate rental apartment building. He is looking at the welfare of the community as a
whole and that the City needs to keep focused on the long term, not short term goals. He feels the City
should give it another couple years to see what the market does.
Peterson talked about what a diverse community we have turned into and how he has always tried to
welcome everyone into our community. He said to vote for the motion on the floor would be
hypocritical and that he feels bad.
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Sean Bruin of 4117 5 St said when he first heard about the proposed townhouses for this site he was
excited. He feels very passionate about giving people a chance and urges support of the change in
language to allow the Habitat townhomes to be built.
Habal currently owns a Habitat house. She is the mother of two children and used to live in south
Minneapolis in an unsafe neighborhood. She is happy to live here where she feels safe and is happy to
be able to own a house. She says Habitat is the best help ever to families.
Sala Jama originally came from Somalia. He grew up in a Habitat house after living in many
apartments. He supports Habitat and their programs which allow families an opportunity to thrive.
The children get educations and have a stable environment to grow and become good citizens who
eventually give back to the community.
There were also a couple of future Habitat residents present who live in Columbia Heights now and are
waiting for a housing unit to open up for them.
The vote on the above Motion was as follows:
Ayes: Herringer, Nawrocki, Williams, Szurek
Nays: Schmitt, Diehm, and Peterson
MOTION PASSED.
EDA Minutes
Page 6
June 23, 2014
OTHER BUSINESS
Fehst told members that the EDA has owned several parcels of land for the past 9 years which have
been tax exempt. By state law these parcels must go back to taxable parcels if not developed. Since
receiving notification from Anoka County on this, a law was passed which changes the time period
from 9 years to 15 years as interpreted by our Legal Counsel. The County however, has been resistant
to this interpretation. In order to avoid the parcels becoming taxable, the City can transfer title on
them to the City of Columbia Heights which would buy us another 9 years to determine what should
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be done with them long term. Action on this must be taken before July 1. Therefore, a Resolution
must be approved tonight to go through with the transfer of title if the county rejects the 15 year time
period. Fehst explained that most of the parcels are surrounding the Public Safety Building, Crestview
Assisted Living Building, and Jackson Pond.
Motion by Diehm, seconded by Herringer to approve the Resolution approving transfer of titles on
EDA owned parcels. All ayes. MOTION PASSED.
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO. _________
RESOLUTION AUTHORIZING THE CONVEYANCE OF CERTAIN PROPERTY BY
THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY TO THE
CITY OF COLUMBIA HEIGHTS
BE IT RESOLVED By the Board of Commissioners ("Board") of the Columbia Heights Economic
Development Authority ("Authority") as follows:
Section 1. Recitals.
1.01. The Authority owns certain property (the “Property”) located in the City of Columbia Heights
(the “City”) which it acquired for economic development purposes, and which is exempt from property tax under
Minnesota Statutes, Section 272.02, subdivision 39 (the “Exemption Act”). A description of the Property is
attached as Exhibit A.
EDA Minutes
Page 7
June 23, 2014
1.02. The Authority has determined that if Anoka County makes a final determination that the
applicable exemption period for the Property under the Exemption Act has expired, it is in the best interest of the
Authority and City that the Authority convey the Property to the City for economic development purposes prior to
July 1, 2014.
Section 2. Authority Approval; Further Proceedings.
2.01. The Authority hereby approves the conveyance of the Property to the City for a purchase price of
$1, to be held by the City for economic purposes. Such conveyance will occur solely in the event of a final
determination that the applicable exemption period for the Property under the Exemption Act has expired.
2.02. The President and Executive Director are hereby authorized to execute on behalf of the Authority
any documents required to carry out, on behalf of the Authority, the conveyance of the Property.
Approved by the Board of Commissioners of the Columbia Heights Economic Development Authority
this 23rd day of June, 2014.
President
ATTEST:
_
Secretary
EXHIBIT A
Property
st
825 41 Avenue, PID No. 35-30-24-14-0151
st
837 41 Avenue, PID No. 35-30-24-14-0155
nd
894 42 Avenue, PID No. 35-30-24-14-0157
4301 Quincy Street, PID No. 35-30-24-14-0159
st
839 41 Avenue, PID No. 35-30-24-14-0160
The next regular EDA meeting will be Monday, August 4, 2014 at City Hall at 6:30 pm.
The meeting was adjourned at 6:38 pm.
Respectfully submitted,
Shelley Hanson
Secretary