HomeMy WebLinkAboutFeb 6, 2017 minutesECONOMIC DEVELOPMENT AUTHORITY (EDA)
MINUTES OF THE MEETING OF
FEBRUARY 6, 2017
The meeting was called to order at 5:30 pm by Executive Director, Walt Fehst
PLEDGE OF ALLEGIANCE- RECITED
The
Oath of Office was taken by Donna Schmitt, Robert Williams, and Connie Buesgens.
Members Present: Donna Schmitt, John Murzyn, Marlaine Szurek,, Bobby Williams, and Connie Buesgens.
Members
Absent: Gerry Herringer
Staff Present: Walt Fehst, Joseph Hogeboom, Keith Dahl, and Shelley Hanson.
Legal Counsel: Martha Ingram, Kennedy & Graven
ELECTION OF OFFICERS:
Nomination
for President: Buesgens nominated Schmitt, and Williams nominated Szurek.
Roll call for Schmitt-Buesgens and Schmitt
Roll call for Szurek-Szurek, Murzyn, and Williams. Szurek is new
President.
Nomination for Vice President: Murzyn nominated Williams, and Schmitt nominated herself.
Roll call for Williams-Murzyn and Williams
Roll call for Schmitt-Buesgens, Schmitt
and Szurek. Schmitt is new Vice President.
Nomination for Treasurer: Schmitt nominated Buesgens, and Szurek nominated Williams.
Roll call for Buesgens-Buesgens and Schmitt
Roll call
for Williams-Szurek, Murzyn, and Williams. Williams is new Treasurer.
Motion by Szurek, seconded by Williams, to elect Szurek as President of the EDA. All ayes.
MOTION PASSED.
Motion
by Szurek , seconded by Williams, to elect Schmitt as Vice President of the EDA. All
ayes. MOTION PASSED.
Motion by Szurek, seconded by Williams, to elect Williams as Treasurer of
the EDA. All ayes.
MOTION PASSED.
Motion by Szurek , seconded by Williams, to appoint Keith Dahl as Secretary of the EDA. All
ayes. MOTION PASSED.
EDA Minutes
Page 2
February 6, 2017
Motion by Szurek , seconded byWilliams, to appoint Shelley Hanson as Assistant Secretary of the
EDA. All ayes. MOTION PASSED.
Motion by Szurek,
seconded by Williams, to appoint Joseph Kloiber as Assistant Treasurer of the
EDA. All ayes. MOTION PASSED.
The meeting was then resumed under the leadership of the newly elected
EDA President.
CONSENT ITEMS
Approve the Minutes from January 3, 2017–
Approve the Financial Report and Payment of Bills for December 2016 on Resolution 2017-01(A).
Questions by
Members:
No questions or comments.
Motion by Williams, seconded by Buesgens, to waive the reading of Resolution 2017-01 there being an ample amount of copies available to the public.
All ayes. MOTION PASSED.
Motion by Williams, seconded by Buesgens, to approve the Minutes and Financial Report and Payment of Bills for December, 2016 as presented. All ayes. MOTION
PASSED.
RESOLUTION NO. 2017-01 (A)
A Resolution of the Economic Development Authority of Columbia Heights, Minnesota, Approving the Financial Statements for the Month of December, 2016
and the Payment of the Bills for the Month of December, 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 outstand ing 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 statements for the month of December, 2016 has been reviewed by the EDA Commission;
and
EDA Minutes
Page 3
February 6, 2017
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 7th day of February, 2017.
Motion by: Williams
Seconded by: Buesgens
BUSINESS ITEM
1. Designation of Official Depositories for the EDA-Resolution 2017-02
Finance
Director, Joe Kloiber, explained that Minnesota statute generally requires local units of government to designate by resolution the financial institutions used as depositories by the
local unit of government. The attached resolution follows the general format of the related resolution passed in previous years by the City and the HRA.
Most general banking transactions
of the EDA/City/HRA are conducted through Northeast Bank. Accounts are also maintained at Wells Fargo Bank of Minnesota, N.A. and U.S. Bank for certain specialized services such as payroll
and debt service payments.
Under this resolution, investment firms used for the pooled investments of the EDA/City/HRA must have an office in the State of Minnesota, and all investments
must comply with authorized investments as set forth in Minnesota statutes.
EDA Minutes
Page 4
February 6, 2016
The only material difference between this proposed resolution and the resolution adopted annually by the City Council is that the EDA resolution
allows for the EDA’s funds to be held in accounts under name of the City. This has always been the EDA’s practice. Since the creation of the EDA in 1996, it has never had a separate
checking account under its own name. All EDA expenditures since its inception have been made using checks drawn in the City’s name on behalf of the EDA. The proposed resolution serves
to clarify this and complies more appropriately with the By-laws.
STAFF RECOMMENDATION:
Staff recommends maintaining these three banking relationships--in combination, they meet the
EDA/City/HRA’s current needs. Staff is currently reviewing the number of brokerage firms used for the investment pool, and will provide the Commissioners with broker updates as that
review progresses.
Questions from members:
There were no further questions.
Motion by Murzyn , seconded by Williams, to waive the reading of Resolution 2017-002, there being ample
copies available to the public. All ayes. MOTION PASSED.
Motion by Murzyn, seconded by Williams, to adopt Resolution 2017-002, being a resolution designating official depositories
for the Columbia Heights Economic Development Authority. All ayes. MOTION PASSED.
RESOLUTION NO. 2017-02
A RESOLUTION OF THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY,
DESIGNATING
OFFICIAL DEPOSITORIES.
Now, therefore, in accordance with the bylaws and regulations of the Columbia Heights Economic Development Authority (the Authority), the Board of Commissioners
of the Authority makes the following:
ORDER OF BOARD
IT IS HEREBY RESOLVED, that Northeast Bank, Wells Fargo Bank of Minnesota, N.A., and U.S. Bank are hereby designated as depositories
for the Authority’s funds.
IT IS FURTHER RESOLVED, that the funds of the Authority can be held in accounts at these depositories under the name and federal identification number of
the City of Columbia Heights, Minnesota (the City), together with the funds of the City, provided that separate fund accounting records are maintained for the respective Authority and
City shares of such accounts in a manner consistent with generally accepted accounting and auditing standards.
EDA Minutes
Page 5
February 6, 2017
IT IS FURTHER RESOLVED, that the responsibility for countersigning orders and checks drawn against funds of the Authority, assigned in the Authority’s
bylaws to the Authority President, is hereby delegated to the City Mayor.
IT IS FURTHER RESOLVED, that checks, drafts, or other withdrawal orders issued against the funds of the Authority
on deposit with these depositories under the City’s name shall be signed by the following:
City Mayor
City Manager
City Treasurer-Finance Director
and that said banks are hereby
fully authorized to pay and charge said accounts for any such checks, drafts, or other withdrawal orders issued by the City on behalf of the Authority.
IT IS FURTHER RESOLVED, that
Northeast Bank, Wells Fargo Bank of Minnesota, N.A., and U.S. Bank are hereby requested, authorized and directed to honor checks, drafts or other orders for the payment of money drawn
in the City’s name on behalf of the Authority, including those drawn to the individual order of any person or persons whose name or names appear thereon as signer or signers thereof,
when bearing or purporting to bear the facsimile signatures of the following:
City Mayor
City Manager
City Treasurer-Finance Director
and that Northeast Bank, Wells Fargo Bank
of Minnesota, N.A., and U.S. Bank shall be entitled to honor and to charge the Authority, or the City on behalf of the Authority, for all such checks, drafts or other orders, regardless
of by whom or by what means the facsimile signature or signatures thereon may have been affixed thereto, if such facsimile signature or signatures resemble the facsimile specimens duly
certified to or filed with the Banks by the Treasurer or other officer of the Authority or City.
IT IS FURTHER RESOLVED, that all transactions, if any, relating to deposits, withdrawals,
re-discounts and borrowings by or on behalf of the Authority with said depositories, made directly by the Authority or by the City on the behalf of the Authority, prior to the adoption
of this resolution be, and the same hereby are, in all things ratified, approved and confirmed.
IT IS FURTHER RESOLVED, that any bank designated above as a depository, may be used as
a depository for investment purposes, so long as the investments comply with authorized investments as set forth in Minnesota Statutes.
IT IS FURTHER RESOLVED, that any brokerage firm
with offices in the State of Minnesota may be used as a depository for investment purposes so long as the investments comply with the authorized investments as set forth in Minnesota
Statutes.
IT IS FURTHER RESOLVED, that the funds of the Authority can be held in accounts at such brokerage firms under the name and federal identification number of the City, together
with the funds of the City, provided that separate fund accounting records are maintained for the respective Authority and
City shares of such accounts in a manner consistent with generally accepted accounting and auditing standards.
EDA Minutes
Page 6
February 6, 2016
BE IT FURTHER RESOLVED, that any
and all resolutions heretofore adopted by the Board of Commissioners of the Authority with regard to depositories or brokerage firms are superseded by this resolution.
ORDER OF ECONOMIC
DEVELOPMENT AUTHORITY
Passed this __6th___ day of ____February___________, 2017
Offered by:
Murzyn
Seconded by:
Williams
Roll Call:
All ayes
President
Attest:
Assistant Secretary
2. EDA Bylaws Amendment
After reviewing the Columbia Heights Economic Development Authority (the “EDA”) bylaws, staff has become aware of outdated language
specifically in regards to the election of an Assistant Treasurer. The Assistant Treasurer is an EDA position that is supposed to be elected annually; however the Assistant Treasurer
has always been the Finance Director of Columbia Heights. Instead of electing an Assistant Treasurer annually, staff proposes that the EDA bylaws be amended to permanently appoint the
duties of the Assistant Treasurer to the Finance Director of Columbia Heights. Attached please find the amended and restated bylaws of the EDA. Members were provided with a copy of
the bylaws showing all proposed language changes in the EDA bylaws that were marked with an underline for an addition or a strikeout to indicate a deletion.
Staff recommends approving
the Amended and Restated Bylaws of the EDA as presented.
Questions from members:
Schmitt questioned whether the EDA appointments must be approved by the City Council. She questioned
the transition of members in January and whether the old members should have been at the first meeting of 2017 since the Council members appointed to the EDA serve the same term as their
Council seat. The confusion of this issue was because the EDA meeting was held prior to the City Council meeting where the newly elected members usually take their oath of office.
However, Buesgens and Schmitt took their oath of office prior to that meeting.
EDA Minutes
Page 7
February 6, 2017
Ingram told members that the By-laws and Enabling Resolution to create the EDA states that the City Council must approve the new commission members
according to the Mayor’s appointment. Hogeboom told members that action was taken by the City Council at the January 9th meeting which was held after the January EDA meeting. Therefore,
the EDA members from 2016 were still active per legal counsel.
Motion by Williams, seconded by Murzyn, to waive the reading of Resolution 2017-03, there being ample copies available
to the public. All ayes. MOTION PASSSED.
Motion by Williams, seconded by Buesgens, to adopt Resolution 2017-03, a resolution approving an amendment to the bylaws of the Columbia Heights
Economic Development Authority. All ayes. MOTION PASSED.
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO. 2017-03
RESOLUTION APPROVING AMENDMENT OF BYLAWS
Section 1. Recitals.
1.01.
The Board of Commissioners (“Board”) of the Columbia Heights Economic Development Authority (the “Authority”) has considered proposed certain amendments to its Bylaws.
1.02. Article
IV, Section 6 of the Bylaws provides for amendments to the Bylaws by majority vote of the Board at any regular or special meeting of the Authority.
1.03. The Board has determined that
it is reasonable, expedient and in the best interest of the public to amend Article II, Sections 1 and 7 of the Bylaws to designate the City Finance Director as Assistant Treasurer of
the Authority, and to amend Article III, Section 1 of the Bylaws to update the regular meeting dates of the Authority Board.
Section 2. Approval of Amendment to Bylaws. The Authority
hereby approves the amendment to its Bylaws in the form attached to this Resolution as Exhibit A.
Adopted by the Columbia Heights Economic Development Authority this 6th of February,
2017.
__________________________________
President
ATTEST:
______________________________________
Assistant Secretary
EDA Minutes
Page 8
February 6, 2017
EXHIBIT A
AMENDED AND RESTATED BYLAWS OF THE
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
ARTICLE I - THE AUTHORITY
Section 1. NAME OF
AUTHORITY. The name of the Authority is the "Columbia Heights Economic Development Authority."
Section 2. OFFICE OF AUTHORITY. The offices of the Authority are at City Hall in
the City of Columbia Heights, Minnesota. The Authority may hold its meetings at such other place or places as it designates by resolution.
Section 3. COMMISSIONERS. The Authority
is governed by seven commissioners appointed in the manner prescribed by City Council Resolution No. 96-01, as amended (Enabling Resolution) and Minnesota Statutes, Sections 469.090
to 469.1081 (Act).
Section 4. OFFICIAL SEAL. The Authority shall have an official seal, which shall be in the form of a circle and shall bear the name of the Authority and the year
of its organization.
ARTICLE II - OFFICERS
Section 1. OFFICERS. The officers of the Authority are the President, the Vice-President, the Secretary, the Treasurer and the Assistant
Treasurer. The President, Vice President, Treasurer and Secretary shall be elected annually. No commissioner may serve as President and Vice President at the same time. The offices
of Secretary and Assistant Treasurer need not be held by a commissioner.
Section 2. PRESIDENT. The President presides at meetings of the Authority. Except as otherwise authorized
by resolution of the Authority, the President signs contracts, deeds and other instruments made by the Authority. At each meeting, the President may submit recommendations and information
concerning the business, affairs and policies of the Authority. At the annual meeting, the President must submit to the Authority a report summarizing the activities and programs of
the Authority for the past year and containing the President's recommendations for Authority activities for the ensuing year.
Section 3. VICE-PRESIDENT. The Vice-President performs
the duties of the President in the absence or incapacity of the President; and in case of the disability or absence of the President, or in the case of a vacancy in the office of President,
the Vice-President performs the duties of the President until a successor has been appointed and qualifies.
EDA Minutes
Page 9
February 6, 2017
Section 4. SECRETARY. The Secretary performs the duties of a secretary for the Authority.
Section 5. TREASURER. The Treasurer has the duties
given by the Act.
Section 6. EXECUTIVE DIRECTOR. The Columbia Heights City Manager is the Executive Director of the Authority and has general supervision over the administration
of its business and affairs subject to the direction of the Authority and signs contracts, deeds and other instruments made by the Authority. The Executive Director is responsible for
the management of the projects and general affairs of Authority under the direction of the Commissioners.
Section 7. OTHER ADMINISTRATIVE OFFICERS. Subdivision 1. Assistant Secretary.
The Authority may designate an assistant to the Secretary to keep the records of the Authority, record the meetings of the Authority in a journal of proceedings to be kept for that
purpose and to perform the duties of secretary under the direction of the Secretary. The assistant must keep in safe custody the seal of the Authority and may affix the seal to contracts
and instruments authorized by the Authority.
Subd. 2. Assistant Treasurer. The Columbia Heights Finance Director of the City is the Assistant Treasurer of the Authority. The Assistant
Treasurer of the Authority has custody of funds of the Authority. The Assistant Treasurer must deposit the funds in the name of the Authority in a bank or banks selected by the Authority.
The Executive Director and the Assistant Treasurer must sign orders and checks for the payment of money and pay out and disburse such monies under the direction of the Authority. Except
as otherwise authorized by resolution of the Authority, orders and checks must also be countersigned by the President. The Assistant Treasurer must keep regular books of accounts showing
Authority receipts and expenditures and render to the Authority, at the annual meeting (and when requested by the Authority), an account of the financial condition of the Authority.
Subd.
3. Deputy Executive Director. The Columbia Heights Community Development Director is the Deputy Executive Director and performs such duties and services as specified by the Executive
Director, subject to direction of the Authority. In the absence or incapacity of the Executive Director, the Deputy Executive Director may sign contracts, deeds and other instruments
made by the Authority.
Section 8. COMBINING ADMINISTRATIVE OFFICES. Administrative offices may be combined.
EDA Minutes
Page 10
February 6, 2017
Section 9. ADDITIONAL DUTIES. The officers of the Authority perform other duties and functions as may from time to time be required by the Authority,
these bylaws or the rules and regulations of the Authority.
Section 10. VACANCIES. If the office of President, Vice-President, Treasurer, or Secretary becomes vacant, pursuant to
Minnesota Statutes 351.02 or by other provisions of law, the Authority must elect a successor at the next regular meeting or at a special meeting called for that purpose. The successor
serves for the unexpired term of the office.
ARTICLE III - MEETINGS
Section 1. REGULAR MEETINGS. Monthly meetings are held at the regular meeting place of the Authority on the first
Monday of each month at 6:30 p.m. unless that date is a legal holiday, in which case the meeting will be held on the next succeeding business day. In the event the date/time/meeting
place of a particular meeting must be changed, the Executive Director may make such change deemed necessary by notifying all Commissioners of the revised meeting time and date in accordance
with the procedures for a special meeting.
Section 3. SPECIAL MEETINGS. Special meetings of the Board of Commissioners may be called by the President, two members of the Board of
Commissioners, or the Executive Director for the purpose of transacting any business designated in the call. The call (including location of meeting) for a special meeting must be delivered
to Commissioners at least two days before the meeting, and notice of the meeting must be posted in the Authority’s offices at least three days before the meeting. At a special meeting,
no business may be considered other than designated in the call, but if all the members of the Authority are present at a special meeting any business may be transacted at such special
meeting by unanimous vote.
Section 4. QUORUM. The powers of the Authority are vested in the commissioners in office from time to time. Four commissioners constitute a quorum for
the purpose of conducting business, but a smaller number may adjourn from time to time until a quorum is present, and when a quorum is not present, a smaller number may adjourn the meeting.
Section
5. ORDER OF BUSINESS. The following is the order of business at regular meetings of the Authority.
1. Roll call.
2. Approval of minutes of the previous meeting.
3. Management Report.
4. Consen
t.
5. All other items.
6. Adjournment.
EDA Minutes
Page 11
February 6, 2017
Section 6. RESOLUTIONS: CONDUCT. Upon direction of the President, or the motion by two members of the Board of Commissioners, resolutions must
be in writing and placed in the journal of the proceedings of the Authority. The meeting will be conducted in accordance with Roberts Rules of Order, Revised.
Section 7. MANNER OF
VOTING. Voting on questions coming before the Authority must be entered in the minutes of the meeting. When a quorum is in attendance, action may be taken by the Authority upon a vote
of the majority of the commissioners.
ARTICLE IV - MISCELLANEOUS
Section 1. FISCAL YEAR. The fiscal year of the Authority shall be the same as the City's fiscal year.
Section
2. TREASURER'S BOND. The Treasurer shall give bond to the state conditioned for the faithful discharge of official duties. The bond must be approved as to form and surety by the Authority
and filed with the Secretary and must be for twice the amount of money likely to be on hand at any one time as determined at least annually the Authority, provided, however, that the
bond must not exceed $300,000.
Section 3. REPORT TO CITY. The Authority shall annually, at a time designated by the City, make a report to the City Council giving a detailed account
of its activities and of its receipts and expenditures for the preceding calendar year. The Authority shall, at the City's request, make available all records necessary to conduct an
audit of the Authority's finances.
Section 4. BUDGET. The Authority shall annually send its budget to the City Council which budget includes a written estimate of the amount of money
need by the Authority from the City in order for the Authority to conduct business during the upcoming fiscal year.
Section 5. SERVICES. The Authority may contract for services of
consultants, agents and others as needed to perform its duties and to exercise its powers. The Authority may also use the services of the City Attorney or hire a general counsel, as
determined by the Authority. The Authority may not hire temporary or permanent employees without prior approval of the City Council.
Section 6. AMENDMENTS TO BYLAWS. The bylaws
of the Authority may be amended only with the approval of at least four commissioners at a regular meeting or at a special meeting called for that purpose.
Amended Bylaws Approved:
_____February 6__________, 2017.
EDA Minutes
Page 12
February 6, 2017
3. Right of Reverter Clause for property located at 4647 Polk Street NE-Resolution 2017-04.
As requested by Steve and Katherine Pepple (the “Pepples”),
on January 3, 2017, the Columbia Heights Economic Development Authority (the “EDA”) directed staff to proceed with exercising the right-of-reverter, pursuant to the Purchase and Redevelopment
Agreement (the “Agreement”) dated August 28, 2014 for the construction of a single-family, owner-occupied home at 4647 Polk Street NE (the “Property”).
Staff sent out a 30-day written
notice to the Pepples on January 6, 2017. The written notice obligated the Pepples to obtain a building permit for an approved house plan by 3:30 PM on February 6, 2017 or the EDA would
re-enter and take back possession of the Property. Since the Pepples requested that the EDA purchase the Property back, they have let the 30-day written notice expire. The EDA may now
take back possession of the property and reimburse the Pepples $6,144.26 for the Property. This amount was previously determined at the EDA
meeting on January 3, 2017 by deducting one
plan review fee of $1,355.74 from the original purchase price of $7,500.
A commitment will be completed for title insurance to verify that the Property has not been encumbered by mortgages
liens, and/ or home equity loans. The cost of title insurance will be deducted from the sale price of the Property once the EDA sells the lot to a developer. Staff anticipates that the
Property would sell to a state licensed home builder for about $20,000 - $25,000.
For the consideration of the EDA at this meeting is Resolution 2017-04 that approves the right-of-reverter,
cancels the Agreement with the Pepples, and adds the Property back into the Single Family Home Lot Sales Program, all subject to the receipt of a commitment for title insurance that
is satisfactory to staff and legal counsel.
Staff recommends approving Resolution 2017-04 as presented.
Question from members:
Szurek asked if the Pepples are aware of the amount
they are being refunded. Dahl said they are satisfied with the amount. He told members he can’t market it yet until we actually get it back, but he hopes to re-sell the property for
$20,000-$25,000 since prices have gone up. He went on to explain that this Resolution will take care of all actions necessary to take the property back and to sell it again under the
City’s housing program.
Ingram told members that they did get the title work back and the property is free of any liens or encumbrances.
EDA Minutes
Page 13
February 6, 2017
Motion by Schmitt, seconded by Williams, to waive the reading of Resolution 2017-04, there being ample copies available to the public. All ayes.
MOTION PASSED.
Motion by Schmitt, seconded by Williams, to adopt Resolution 2017-04, Resolution approving the cancellation of the purchase and redevelopment agreement between the Columbia
Heights Economic Development Authority and Katherine and Steve Pepple. All Ayes. MOTION PASSED.
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO. 2017-04
RESOLUTION
APPROVING CANCELLATION OF PURCHASE AND REDEVELOPMENT AGREEMENT BETWEEN THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY AND KATHERINE AND STEVEN PEPPLE
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 and Katherine and Steven Pepple
(the “Buyer") previously entered into a Purchase and Redevelopment Agreement dated August 4, 2014 (the “Contract”), setting forth the terms and conditions of sale and redevelopment of
certain property located at 4647 Polk Street and described as Lots 25 and 26, Block 1, Sheffield’s Second Subdivision to Columbia Heights, Anoka County, Minnesota (the “Property”),
and the Authority conveyed the Property to the Buyer pursuant to the Contract.
1.02. Pursuant to the Contract, the Buyer was required to construct a single family home, subject to
the City’s zoning and building codes and policies, within one year after closing on the conveyance of the Property. If the Buyer failed to meet this deadline, the Contract provided
that the Authority could, upon 30 days’ notice to the Buyer, exercise its right of reverter and reacquire the Property.
1.03. The Buyer has failed to construct the single family home
as required under the Contract, and the Authority sent written notice of default to the Buyer on January 4, 2017, informing the Buyer of its right to exercise its right of reverter.
The Buyer has agreed to convey the Property back to the Authority.
1.04. The Authority finds that exercise of its right of reverter, cancellation of the Contract, and the addition
of the Property to the Authority’s Residential Lot Sales Program (the “Program”) for the purpose of remarketing the Property to other potential buyers are in the public interest and
in the best interest of the Authority and City, because these actions will allow the Property to be made available for private development under a duly approved housing program and will
further the City’s housing goals.
Section 2. Authority Approval; Further Proceedings.
EDA Minutes
Page 14
February 6, 2017
2.01. The Board hereby approves exercise of its right of reverter and reacquisition of the Property via a warranty deed from the Buyer, cancellation
of the Contract, and the addition of the Property to the Program, all subject to receipt of a commitment for title insurance and verification by Authority’s legal counsel that no liens
exist against the Property that would have a detrimental effect on the Authority’s ownership interest in the Property.
2.02. The President and Executive Director are hereby authorized
to execute on behalf of the Authority the cancellation of the Contract and any documents related to reacquisition of the Property requiring execution by the Authority.
2.03. Authority
and City staff are authorized and directed to take all actions to add the Property to the Program and to market the Property pursuant to the Program guidelines.
Approved by the Board
of Commissioners of the Columbia Heights Economic Development Authority this 6th day of February, 2017.
President
ATTEST:
Assistant Secretary
4. Third
Amendment – ACCAP Purchase Agreement for EDA Acquisition of 4641-43 Polk St-Resolution 2017-05.
Dahl explained that previously, the Columbia Heights Economic Development Authority (EDA)
approved a Second Amendment to the Purchase Agreement on November 7, 2016 to extend the closing date to December 30, 2016. However, due to more unanticipated delays, ACCAP is requesting
the closing date be extended again. For the EDA consideration at this meeting is a Third Amendment to the Purchase Agreement, which extends the closing for the sale of the Property to
take place on or before March 31, 2017. ACCAP intends to close on the Property as soon as an extension is granted.
Staff recommends the approval of Resolution 2017-05, a resolution
approving the Third Amendment of a Purchase Agreement that will extend the closing date of the Property to take place on or before March 31, 2017.
Questions from members:
There were
no questions or comments regarding this matter.
Motion by Williams, seconded by Buesgens, to waive the reading of Resolution 2017-05, there being ample copies available to the public.
All ayes. MOTION PASSED.
EDA Minutes
Page 15
February 6, 2017
Motion by Williams, seconded by Murzyn, to adopt Resolution 2017-05, a resolution approving a Third Amendment of a Purchase Agreement between the
Columbia Heights Economic Development Authority and Anoka County Community Action Program. All ayes. MOTION PASSED.
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
EDA RESOLUTION
NO. 2017-05
RESOLUTION APPROVING A THIRD AMENDMENT TO A PURCHASE AGREEMENT BETWEEN THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY AND ANOKA COUNTY COMMUNITY ACTION PROGRAM, INC.
BE
IT RESOLVED BY the Board of Commissioners (“Board”) of the Columbia Heights Economic Development Authority (the “Authority”) as follows:
Recitals.
1.01. The Authority currently administers
the Downtown CBD Redevelopment Project (the “Project”) within the City of Columbia Heights (the “City”), pursuant to Minnesota Statutes, Sections 469.090 to 469.1082, as amended.
1.02. The
Authority and Anoka County Community Action Program, Inc. (the “Seller”) executed a Purchase Agreement, dated as of May 26, 2016 (the “Agreement”), providing for the conveyance by the
Seller to the Authority of certain property within the Project and City legally described as follows:
That part of Lot 23 lying north of the South 20 feet of the SD Lot 23 and Lot 24,
Block 1, Sheffields 2nd Subdivision, County of Anoka, State of Minnesota (the “Property”).
1.03. On August 31, 2016, the parties entered into a First Amendment to the Purchase Agreement
(the “First Amendment”) to extend the deadline for conveyance of the Property.
1.04. On October 28, 2016, the parties entered into a Second Amendment to the Purchase Agreement (the
“First Amendment”) to further extend the deadline for conveyance of the Property.
1.05. The parties have negotiated and propose to execute a Third Amendment to the Agreement (the “Third
Amendment”) to further extend the deadline for the conveyance of the Property.
EDA Minutes
Page 16
February 6, 2017
Section 2. Third Amendment Approved.
2.01. The Third Amendment as presented to the Board is 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 Third Amendment by such officials shall
be conclusive evidence of approval.
2.02. The President and Executive Director are hereby authorized to execute on behalf of the Authority the Third Amendment and any documents referenced
therein requiring execution by the Authority, and to carry out, on behalf of the Authority, its obligations thereunder.
2.03. Authority staff and consultants are authorized to take
any actions necessary to carry out the intent of this resolution.
Approved by the Board of Commissioners of the Columbia Heights Economic Development Authority this 6th day of February,
2017.
President
ATTEST:
Assistant Secretary
THIRD AMENDMENT TO PURCHASE AGREEMENT
This Third Amendment to Purchase Agreement (“Amendment”) is made this
6 day of February, 2017 by and between Anoka County Community Action Program, Inc., a Minnesota nonprofit corporation (the “Seller”) and the Columbia Heights Economic Development Authority,
a Minnesota public body corporate and politic (the “Buyer”).
WHEREAS, the Seller and the Buyer entered into that certain Purchase Agreement dated as of May 26, 2016 (the “Agreement”)
providing for the conveyance by the Seller to the Buyer of certain property at 4641/4643 Polk Street located in the City of Columbia Heights, Anoka County, Minnesota and legally described
as follows:
That part of Lot 23 lying north of the South 20 feet of the SD Lot 23 and Lot 24, Block 1, Sheffields 2nd Subdivision, County of Anoka, State of Minnesota (the “Property”);
and
WHEREAS, on August 31, 2016, the parties entered into the First Amendment to Purchase Agreement in order to extend the closing date to October 31, 2016 (the “First Amendment”);
and
EDA Minutes
Page 17
February 6, 2017
WHEREAS, on October 28, 2016, the parties entered into the Second Amendment to Purchase Agreement in order to extend the closing date to December
30, 2016 (the “Second Amendment”); and
WHEREAS, due to unanticipated delays, the parties have determined to further extend the deadline for closing on the conveyance of the Property.
NOW,
THEREFORE, in consideration of the premises and the mutual obligations of the parties hereto, each of them does hereby covenant and agree with the other as follows:
1. Amendment to
Paragraph 7 of the Agreement. Paragraph 7 of the Agreement is amended as follows:
CLOSING DATE. The closing of the sale of the Property shall take place on or before March 31, 2017
unless otherwise mutually agreed by the parties. The closing shall take place at Columbia Heights City Hall, located at: 590 40th Avenue NE in Columbia Heights, Minnesota or such other
location as mutually agreed upon by the parties.
2. Miscellaneous. Except as amended by this Amendment, the Agreement shall remain in full force and effect.
IN WITNESS WHEREOF,
the parties have executed this Third Amendment to Purchase Agreement as of the date written above.
SELLER
ANOKA COUNTY COMMUNITY
ACTION PROGRAM, INC.
By:
________________________________
Its: _________________________________
BUYER
COLUMBIA HEIGHTS
ECONOMIC DEVELOPMENT
AUTHORITY
By:
_________________________________
Its: President
By:_________________________________
Its: Executive Director
EDA Minutes
Page 18
February 6, 2017
OTHER BUSINESS:
1. DISCUSS OPTIONS FOR REFUNDING (REFINANCING) THE EDA 2007 LIQUOR STORE BONDS
Kloiber explained that in 2007, the EDA issued
$5 million of revenue bonds to finance the construction of two new liquor stores. The EDA owns the two buildings constructed, and leases the buildings to the City in exchange for lease
payments equal to the EDA’s bond payments. The City owns the underlying land.
Those 2007 EDA bonds are now eligible for refunding (refinancing). The remaining $3.4 million of the 2007
bonds that is still outstanding is scheduled to be paid through the year 2030. The 2007 bonds have an interest rate of approximately 4.9%. Interest rates of approximately 2.6% are
currently available, depending on the type and terms of the refunding bonds issued.
Kloiber reviewed the available refunding options with the EDA/City’s bond advisor, Ehlers and Associates,
and presented an overview of these options to the Commissioners. He said the first decision is how to re-finance the Liquor Store Bonds that became eligible last week. He told members
the EDA could ref-finance the Lease Revenue Bond at 3.1% for a savings of approximately $400,000, or the City could go with a General Obligation Bond with an interest rate of 2.6% for
a savings of about $700,000. He recommended that the refunding bonds be issued by the City instead of the EDA, in order to obtain the more favorable interest rate available to the City’s
general obligation bonds, as compared to the EDA’s revenue bonds.
In addition to the Liquor Bonds, the Public Safety Building Bonds are coming up for re-financing in the fall of 2017
or we could do an advance re-financing and do both of them at the same time. The advance re-financing does cost more than if we wait till they become eligible in the fall. But if interest
rates rise, it may save more than what the additional costs would be to do it now. Since we don’t know what interest rates will do, it is a risk that the Council will have to discuss
and decide on. Fehst thought we should take advantage of the low interest rates we have in place now, not knowing how much they may increase as the economy improves.
The final thing
to consider is the City has been building up a Reserve Fund as part of their five year plan. It was anticipated that long term we would use part of that fund when the Public Safety
funds became eligible to pay off some of the bonds to reduce the debt level. There currently is about 2 million dollars in the Reserve account. The EDA/Council needs to decide what
it wants to do with that amount. Kloiber said the decision may be to use it as originally planned or for a new City Hall building located near the Library. We could then sell the existing
building and it could become an EDA Redevelopment Project.
EDA Minutes
Page 19
February 6, 2017
Kloiber said he will work with Ehlers to firm up the options the City has regarding these three issues. He said he understands the general consensus
of the EDA is to move forward with re-financing the Liquor Bonds with General Obligation Bonds and to move forward with the transfer of ownership of the buildings to the City in exchange
for the City paying off the EDA bonds. He said there isn’t much risk if the City takes ownership of the buildings and bonds since in a worst case scenario that the Liquor stores were
closed there still is 2.5 million in inventory plus the three properties that could be sold which would be able to pay down the 3.5 million dollar debt. Even if it takes a while to
sell the buildings, Ehlers said the City is in the position of coming up with other funds to pay for the bonds in an emergency to avoid defaulting on the bonds.
Schmitt asked if the
EDA would have to give ownership of the Liquor stores to the City before the process to re-finance the Bonds could start. Ingram said the EDA has collateral ownership anyways, so it
shouldn’t matter, and could be done all at once.
Buesgens suggested holding a mini goal setting session to discuss the use of the 2 million dollar reserve fund prior to the target
date for re-financing of May. Fehst and Kloiber said they will get the options from Ehlers during the next month and then a meeting will be scheduled to discuss the refinancing options
and the use of the reserve funds.
2. DISCUSSION REGARDING MEMBERSHIP OF THE EDA
Commission member Schmitt requested a discussion regarding membership requirements for the number
of council members that must be on the EDA and if there are requirements that address non-resident members. Martha Ingram prepared a memo to the members that explained the established
bylaws of the EDA and the flexibility allowed under them. It was noted that there must be 7 members total, that at least two have to be councilmembers, but no more than five. She
also noted that there is no residency requirement for eligibility to serve on the EDA Commission.
Schmitt stated she would like to see other residents with business backgrounds be
included as members of the EDA, especially those with Community or Economic Development experience. Schmitt said that the City received an application from a Mr. Kaiser who has a background
in this field and would like to see him appointed to the vacant EDA seat rather than waiting for the new Council member to be appointed. She suggested appointing the new council member
as an alternate. Ingram told members that an alternate would not be able to vote on issues.
EDA Minutes
Page 20
February 6, 2017
Ingram then told members that the Enabling Resolution mirrors the language of the EDA Act so there is no need to make any changes to the By-Laws
if they wish to appoint a person other than a council member. She explained that several cities allow business owners to sit on their EDA’s especially in out-state areas.
Szurek asked
if we could change the number of members from 7 to 9. Ingram said we could, but she isn’t aware of any EDA’s that have more than that.
Hogeboom and Dahl spoke of the Business Council
that is an off shoot of the Chamber. They said that interest in it has waned but maybe participants from that group could be tapped to serve on some type of task force that would make
recommendations to the EDA if the EDA is interested in forming this type of committee.
Kloiber said if the EDA changes so that City Council members don’t make up the majority (4 persons)
it would have an impact on the Annual Financial Reports.
Hogeboom told members that staff will come back next month with some scenarios to consider.
3. 2017 STRATEGIC PLANNING DISCUSSION
Dahl
explained that throughout 2016, the Economic Development Authority (EDA) has accomplished several projects and objectives. The purpose of this report is to review and discuss the EDA’s
accomplishments in 2016, but also to determine the projects and objectives that the EDA would like staff to focus on in 2017. Highlights of 2016 accomplishments include, but not limited
to the following:
2016 EDA Accomplishments
Completed the development of the Library on the Mady’s property.
Facilitated redevelopment on the corner of University Avenue NE and
37th Avenue NE with the development of the Legends of Columbia Heights in an effort to complete the Huset Park redevelopment project initiated back in 2005 (One undeveloped parcel remains
on the corner of Huset Parkway and Jefferson Street).
Leveraged funds through the Legends of Columbia Heights development for the completion of a trail and fencing along the east side
of University Avenue NE between 40th Avenue NE and 37th Avenue NE.
Completed a voluntary groundwater monitoring report in Huset Park for the MPCA.
Stimulated the redevelopment opportunity
of the Central Valu Center by establishing a TIF district and entering into a Contact for Private Redevelopment with Hy-Vee for a grocery store to be located in Columbia Heights once
again.
EDA Minutes
Page 21
February 6, 2017
Sold the remaining lots in the Scattered Site TIF District Housing Program.
Initiated the Single Family Home Lot Sales Program and sold 5 of
6 lots that were available.
Now, as the EDA looks ahead to 2017, staff seeks to facilitate discussion about what projects, programs, and objectives commission members desire to see
initiated and/ or completed in 2017. First, staff would like to review the fund balances of several accounts that the EDA utilizes to accomplish its initiatives. The figures below are
estimations and subject to change as the year-end fund balances have not been finalized for all the accounts.
Fund 213, Parkview Villa South-an HRA Account $ 1,000,000
Must be used
for Housing Redevelopment
Fund 226, Special Projects Revenue-Used by EDA, CD, Public Wks. $ 675,000
Use for something pertinent to all 3 depts. (i.e. street scaping)
Fund 371, TIF T4
Kmart/ Central Ave-Heritage Hts. area $ 400,000
For Grand Central and Heritage Hts. Area Development
Fund 376, TIF A3,C7,C8 Scattered Site District-Residential only $ 190,000
Must
be for Income Qualified Buyers
Fund 420, CAP Improvement Development: $ 950,000
There is still $304,000 owed to us.
The list below provides a starting point for the discussion tonight.
Staff highly encourages the EDA commission members to provide feedback and propose changes to the following 2017 proposed projects, programs, and objectives:
2017 Proposed Projects,
Programs and Objectives
Develop and initiate a business retention and expansion program to assist the Columbia Heights business community.
Land acquisition of residential properties
located in commercial zoning districts along Central Avenue. (Supporting Map Attached)
Land acquisition and initiate redevelopment of the Root Property located on the corner of 40th
Avenue and University Avenue. Anoka Co. will accept applications/presentation for CDBG funds on Feb. 14th and will make their decision in March. The City would get notice of final
funding in June.
Finalize the closing of the ACCAP property located at 4641-43 Polk Street NE.
Demolish the structures located at 4201 Jefferson Street NE and 4641-43 Polk Street NE,
and add both properties to the Single Family Home Lot Sales Program.
Reacquire and add 4647 Polk Street to the Single Family Home Lot Sales Program.
EDA Minutes
Page 22
February 6, 2017
After the remaining lots sell (4641 Tyler Street NE, 4647 Tyler Street NE, 4641 Polk Street NE, 4647 Polk Street NE, and 4201 Jefferson Street
NE) in the Single Family Home Lot Sales Program, discontinue the program until more lots are acquired.
Determine a fund source and create a housing rehabilitation grant or low to no
interest loan program for exterior remodels and/ or interior renovations.
Discussion:
There was also a discussion regarding non-conforming homes along Central Avenue. The EDA would
like staff to reach out to owners between 37th and 45th to see who may be interested in selling their properties, or to pursue the first right of refusal. Dahl said he would prepare
a letter and an inventory list of the non-conforming properties, with owner information, estimated market values, etc. and provide this to the members at the next meeting.
Dahl asked
members to think about whether they want to continue purchasing residential properties for demolition or for rehab, or to change the focus to business retention and expansion funding.
He said this is something else to be discussed at the goal setting session. The soonest we can probably schedule this meeting would be in April after the new council member is appointed,
however no date was established at this meeting .
Buesgens asked where the proceeds from the Library sale go. Dahl said the 420 account would be reimbursed then the rest goes to the
City.
The meeting was adjourned at 7:30 pm.
Respectfully submitted,
Shelley Hanson
Secretary