HomeMy WebLinkAboutMar 7 2016 EDA Min
ECONOMIC DEVELOPMENT AUTHORITY (EDA)
MINUTES OF THE MEETING OF
MARCH 7, 2016 IN CONFERENCE ROOM 1
The meeting was called to order at 6:00 pm by Gary Peterson.
Members Present: Bruce Nawrocki, Donna Schmitt, Gary Peterson, John Murzyn, Marlaine Szurek, Bobby
Williams, and Gerry Herringer (arrived at 6:25 pm).
Staff Present: Walt Fehst, Joseph Hogeboom, Keith Dahl, and Shelley Hanson.
PLEDGE OF ALLEGIANCE-
RECITED
Hogeboom stated they had one item to add to the agenda in order to give members some information on
an agenda item that will be discussed in their work session later tonight regarding the existing Library
building. It will be addressed under Business Items.
CONSENT ITEMS
1.Approve the Minutes from January 4, 2016
.
2.Approve the Financial Report and Payment of Bills for December 2015 and January 2016 on
Resolution 2016-05.
Questions by Members:
Nawrocki questioned the figures on the December report, page 22, as they didn’t match up. Hogeboom
said he found out that the totals are not the year end totals. He said the final transfers between funds 201 &
204 aren’t depicted on these reports. He said the final totals will be ready for the next meeting. He told
members that last year they were under budget by $1,600 once the journal entries were made.
Motion by Nawrocki , seconded by Schmitt , to waive the reading of Resolution 2016-05 there being an
ample amount of copies available to the public. All ayes. MOTION PASSED.
Motion by Nawrocki , seconded by Schmitt , to approve the consent agenda as presented. All ayes.
MOTION PASSED.
RESOLUTION NO. 2016-05
A Resolution of the Economic Development Authority of Columbia Heights, Minnesota, Approving the
Financial Statements for Months of December, 2015 and January, 2016 and the Payment of the Bills for
the Months of December, 2015 and January, 2016.
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
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March 7, 2016
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 December, 2015 and January, 2016 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.
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Passed this 7 day of March, 2016.
Motion by: Nawrocki
Seconded by: Schmitt
BUSINESS ITEM
1.Existing Library Building
Kevin Hansen will be speaking to the City Council at the work session regarding plans for the existing Library
Building. Hansen had Dahl do a preliminary market analysis of the existing building to obtain information on
the possible market value and the amount of tax that could be expected if the building is sold.
Dahl stated that he worked with Core Commercial Company that gave him a (BOV) Broker’s Opinion of Value
for the site. He explained that Core Commercial classified the building as a “Class C” structure which means it
is an older building that will require extensive renovations such as new windows, a sprinkler system, and
modifications to make it ADA accessible. Dahl told members they felt the estimated value of the building
based on comparable sales would be around $600,000. They thought it could be listed for $650,000 and would
sell fairly quickly. Dahl said he contacted the County and found out that based on that value and if it were used
as office space it would generate approximately $25,000/year in taxes.
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March 8, 2016
Schmitt asked how much the funeral home across the street from the Library sold for. Hogeboom stated he
would look up that information and report back to the members in the green sheet. The sale just took place in
January so staff has not received that information yet from Anoka County.
Nawrocki asked if this preliminary value included the extra lot across the street where the community garden is
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located (828 40 Ave). Dahl told members that it was not included in the estimate he had done. Nawrocki felt
the amount of parking on the Library site is insufficient and that the extra lot could be part of the overall
package. He went on to tell members that this building was originally built as a bomb shelter and that Federal
funds were used. He asked whether there would be any restrictions on the sale of the building based on the
funding source when it was built. Staff will research this, but since it was so long ago, they doubted it.
Schmitt said research would also have to be done to see if there are any strings attached to the sale of the extra
lot since it was purchased with CDBG funds. Hogeboom said there are certain objectives that must be met, but
he has done some research on this and he is confident the conditions can be met.
Nawrocki stated he thought there should be a “For Sale” sign up now and he would suggest it be listed for
$700,000.
2.Purchase and Redevelopment Agreements with Tollberg Homes LLC-Resolution 2016-06
Dahl explained that in September 2015, the Economic Development Authority (EDA) established the Single
Family Home Lot Sales Program. At the meeting of January 2016, the EDA approved resolution 2016-03,
authorizing the approval of a purchase and redevelopment agreement with Tollberg Homes for six residential
lots. As of February 2016, Tollberg Homes has purchased three of the six residential lots at $22,500 per lot.
However, due to unexpected sewer and water improvements to the remaining three residential lots, Tollberg
Homes has proposed a $4,000 purchase price reduction per lot. Tollberg Homes is now offering a purchase
price of $18,500 per lot for the remaining three residential lots listed as follows:
4636 Polk Street NE PID 25-30-24-33-0025
4648 Polk Street NE PID 25-30-24-33-0023
4618 Polk Street NE PID 25-30-24-33-0028
Listing prices for the aforementioned lots were established at the Estimated Market Value for the individual
properties, ranging from $40,200 to $50,600. However, in speaking with various home builders, staff received
feedback that the lots currently available in the program, which are located in the Heritage Heights area, are of
lower value than other properties throughout the City. Tollberg Homes offer of $18,500 still exceeds the
estimated property value given by a local real estate agent.
Tollberg Homes has included a proposal that describes the company’s portfolio and plans for the lots. Staff has
reached out to other communities in which Tollberg has built homes, and has received very positive feedback
about the quality of Tollberg Homes’ product, as well as the company’s professionalism.
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January 4, 2016
Dahl told members that he had checked with Public Works and Contractors to verify the cost of
doing the extra Sewer and Water work that Tollberg claims would be required for these three
lots. He said the $4,000/lot expense is a reasonable amount to use. Therefore, staff
recommends approval of Resolution 2016-06, authorizing approval of the Purchase and
Redevelopment Agreements with Tollberg Homes, LLC for the acquisition of the following
properties:
4636 Polk Street NE PID 25-30-24-33-0025
REMOVED-
4648 Polk Street NE PID 25-30-24-33-0023-No extra work reqd.
4618 Polk Street NE PID 25-30-24-33-0028
Questions from members:
Nawrocki strongly disagreed with staff’s recommendation and does not approve lowering the
price of the lots any further than what was already approved at $22,500/lot.
Peterson asked if we had other interested parties in these lots. Hogeboom stated that this
information was posted on the Web site and notices were sent directly to 12 companies who had
previously expressed interest in them. Tollberg Homes was the only one to submit a formal
offer. Hogeboom stated that based on feedback he had received, other lots throughout the City
would sell for more, closer to the estimated market values, but in the Heritage Heights area, sales
prices tend to be less. Peterson thought $4,000/lot reduction was fair, if in fact, extra sewer and
water work is necessary.
Murzyn stated he thought the water and sewer disconnects on the properties the City bought
were done correctly and would not need the extra work as claimed. He told staff to check the
paperwork that was attached to the Purchase Orders and Payment Vouchers for detailed
information on each property to determine how they were done, and if done correctly, a
reduction in price would not be warranted.
Peterson suggested making the motion approving a reduction contingent upon confirmation of
whether the sewer and water work was not done as it should have been.
Motion by Williams , seconded by Murzyn, to waive the reading of Resolution 2016-06, there
being ample copies available to the public. All ayes. MOTION PASSED.
Motion by Williams , seconded by Murzyn, to adopt Resolution 2016-06, Resolution Approving
Purchase and Redevelopment Agreements with Tollberg Homes, LLC for the acquisition of
certain residential lots for a price of $18,500/lot contingent on whether they have to do extra
sewer and water work as determined by City staff. Roll call: ayes-Herringer, Williams, Szurek,
Schmitt, Murzyn, and Peterson. Nay-Nawrocki. MOTION PASSED.
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March 7, 2016
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO. 2016-06
RESOLUTION APPROVING REVISED PURCHASE AND
REDEVELOPMENT AGREEMENTS WITH TOLLBERG
HOMES, LLC.
BE IT RESOLVED BY the Board of Commissioners ("Board") of the Columbia Heights
Economic Development Authority (the "Authority") as follows:
Section 1. Recitals.
1.01. The Authority has previously adopted a program called the Single Family Home Lot
Sales Program (the “Program”), and has adopted guidelines in connection with the Program (the
“Guidelines”).
1.02. The Authority has received an offer from Tollberg Homes, LLC (the “Buyer”) to
purchase certain properties included in the Program (the “Property”), described as attached
hereto as Exhibit A, and the parties have negotiated Purchase and Redevelopment Agreements
(the “Agreements”) which provide for the conveyance of the Property to the Buyer and the
construction by the Buyer of single-family homes on the Property, all pursuant to the Guidelines.
1.03. On October 21, 2015, the Planning Commission of the City reviewed the
proposed conveyance of the Property pursuant to the Program and found that such conveyance is
consistent with the City’s comprehensive plan.
1.04. On January 4, 2016, the Authority conducted a duly noticed public hearing
regarding the conveyance of the Property to the Buyer, at which all interested parties were given an
opportunity to be heard, and approved the Agreements.
1.05. Subsequent to Authority approval of the Agreements, the Buyer requested and the
Authority agreed to a reduction in the purchase price of the Property, due to higher-than-anticipated
Buyer expenses related to the water and sewer connections of the Property to City water and sewer
mains. The parties agreed to amend the Agreements to reflect the reduced purchase price.
1.06. The Board has reviewed the Agreements as so amended (the “Amended
Agreements”) and finds that the execution thereof and performance of the Authority's obligations
thereunder, including the conveyance of the Property to the Buyer, are consistent with the
Guidelines and in the best interest of the City and its residents.
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March 7, 2016
Section 2. Approval and Authorization of Amended Agreements and Conveyance
2.01. The Amended Agreements as presented to the Board and the conveyance of the
Property provided for therein are hereby in all respects approved, subject to modifications that do
not alter the substance of the transaction and that are approved by the President and Executive
Director, provided that execution of the Amended Agreements by such officials shall be conclusive
evidence of approval.
2.02. Authority staff and officials are authorized to take all actions necessary to perform
the Authority’s obligations under the Amended Agreements as a whole, including without limitation
execution of any documents to which the Authority is a party referenced in or attached to the
Amended Agreements, and any deeds or other documents necessary to convey the Property to the
Buyer, all as described in the Amended Agreements.
Section 3. Effective Date. This resolution shall be effective upon approval.
Approved by the Board of Commissioners of the Columbia Heights Economic Development
Authority this 7th day of March, 2016.
President
ATTEST:
Secretary
4648 Polk Street was removed as the extra sewer and water work was not necessary.
EXHIBIT A
Property
ADDRESS LEGAL DESCRIPTION PID
4636 Polk Street NE Lot 5, except the North 35 feet thereof, all of Lot 6, 25-30-24-33-0025
and the North ½ of Lot 7, in Block 2, Sheffield’s
Second Subdivision, Anoka County, Minnesota
[Torrens]
4618 Polk Street NE Lot 11, and the North 10 feet of Lot 12, Block 2, 25-30-24-33-0028
Sheffield’s Second Subdivision, Anoka County,
Minnesota [Torrens]
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March 7, 2016
OTHER BUSINESS
1.Blue Cross Blue Shield Active Place Demonstration Grant
Dahl told members that staff has applied for the Active Places Demonstration Projects Grant
offered through Blue Cross Blue Shield (BCBS) requesting $20,000. The demonstration project
must support changes to policy or to the physical environment. These changes should focus on
encouraging people to participate in physical activity.
Staff proposed, in conjunction with the opening of the new library, temporary beautification
improvements along Central Avenue NE between 39th Avenue and Gould Avenue. The
temporary beautification improvements would incorporate a mural painted on the street at the
intersection of Gould Ave. and Central Ave. NE, a mural painted on the South wall of the
Heights Theater, and wood structure planter boxes sprouting edible vegetables lined along the
East sidewalk of Central Ave. NE. Our hope is art will catch the eye, stimulate the mind, and
create social responsibility shaping the communities sense of place, which will directly increase
physical activity through traffic calming controls.
All of the aforementioned beautification improvements would be entirely funded by the amount
that is awarded to Columbia Heights from the BCBS grant. Dahl said he got a quote from an
artist for a 330 sf mural for $16,000. He is hoping the mural would not have to be removed at
the end of the season and yet qualifies for the grant funds.
The goal of the temporary BCBS grant is to inspire change long-term to create a safe Central
Avenue Business District for both pedestrians and cyclists, easily accessible for residents, and
maintains a sense of place and pride within the community. It is meant to encourage the City
Council and residents to support future funding for improvements similar to these temporary
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ones. We will be notified on March 30 if we will be awarded the grant funds.
Szurek hoped that if that kind of money is spent on the mural that it would not have to be
removed. She wants staff to check further into that and any other options that the funds could be
used for. She stated that the mural would not be very visible due to the placement of the Library
building so close to Central. Dahl stated that the mural would only be 330 sf and would be
placed close to Central Avenue. It will also be visible to Library patrons from inside the
building.
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March 7, 2016
2.Single Family Home Lot Sales Program-ACCAP
Anoka County Community Action Program (ACCAP) reached out to the City at the end of
January about possible acquisition of 4641/43 Polk Street, a duplex owned by ACCAP.
Previously in 2015, the City had intentions of purchasing the property for $75,000; however,
both parties shared different views on how to proceed.
4641/43 Polk Street is bound by a 30 year mortgage that matures in 2028 with the Minnesota
Housing Finance Agency. ACCAP believed, at this time, the only way to persuade the
Minnesota Housing Financing Agency to release the property from financial commitment was to
have the City condemn the property. After staff review, the property was not found to be
condemnable by City standards, which resulted in no further action from both parties.
If the City is still interested in acquiring the property, ACCAP is requesting the City to submit an
expression of interest for the acquisition of 4641/43 Polk Street. In which case, ACCAP will then
approach the Minnesota Housing Finance Agency to persuade them to release the property from
financial commitment.
Staff recommends, if the City is still interested in acquisition of 4641/43 Polk Street, to submit a
letter to ACCAP outlining the City’s interest in the property and to offer no more than $75,000
for the property.
Questions from Members
Members said they may still be interested in obtaining the property, but will need to discuss it at
the next meeting since time constraints didn’t allow enough time to discuss at this meeting.
Hogeboom stated it was not time sensitive and can wait until the next meeting.
Hogeboom reminded members that there will be a special goal setting meeting on Tuesday,
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March 15 at 4 pm. at the Public Safety Building, and that the next regular meeting will be
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Monday, April 4, 2016. Nawrocki stated that Coffee with a Cop is scheduled for April 4 also.
Fehst and Peterson said that EDA meetings and work sessions are regularly scheduled for the
first Monday of each month, so he will have to decide which meetings to attend.
The meeting was adjourned at 6:45 pm.
Respectfully submitted,
Shelley Hanson
Secretary