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HomeMy WebLinkAboutEDA MIN 11-05-12ECONOMIC DEVELOPMENT AUTHORITY (EDA) MINUTES OF THE MEETING OF' NOVEMBER 5, 2012 IN CONFERENCE ROOM 1, "I'he nieeting was called to order at 6:30 pm by Chair Peterson, Members Present: Bruce Nawrocki, Gary Peterson, Donna Schmitt, Marlaine Szurek, and Tarnmera Dielitil. Gerry I lerringer arrived at 6:35 pm and Bobby Williams arrived at 6:55 pni. Staff Prese tit: Walt Felist, Scott Clark, Sheila Cartney, and Shelley Hanson, 2. PLEDGE OF ALLEGIANCE- RECITED 3. CONSENT ITEMS 1. Approve the Minutes from August 6, 2012, Special meeting of August 27, 201.2, Special meeting of September 17, 2012 and fi•orn the Executive Session of September 17, 2012. 2. Approve the Financial Report and Payment of Bills for July, August, and September 2012 on Resolution 2012-14. A,fo(ion by Diehin, secon(led kv N'aTi,,rocki, to waive the reading qf'Resolution 2'012-14, there being an any)le amount ofcolfies available lo the public. All ayes. A40TION 1'AS,5EIJ. Mblion by Diehin, seconded by Naivrocki, to qpj)roi,,e the minutes camel aclojw Resolution 2012 - 14l All ayes. M0770N Pll&' "ED. EDA RESOLUTION 2012-14 RESOLUTION OF THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY (EDA) APPROVING THE FINANCIAL STATEMENT FOR JUI..,Y, AUGUST, AND SEPTEMBER 2012 AND PAYMENT OF BILLS FOR "I MONTHS OF JULY, AUGUST, AND SEPTEMBER 2012. WHEREAS, the COILInibia Heights Economic Development Authority (EDA) is required by Minnesota Statutes Section 469.096, Subd.,9, to prepare a detailed financial statenient which shows all receipts and disbursenients, their natUre, the money on ]land, the purposes to wliiell, the money oil hand is to be applied, the EDA's credits and assets and its outstanding liabilities; and WHEREAS, said Statute also requires the F"DA to examine the Statement arid treasurer's vouchers or bills and if correct, to approve then by resolution and enter the resokltiOri in its records; and WHEREAS, the financial statenient for the montlis ofhly, August, and September 2012 lias been reviewed by the EDA Corninission; and WHEREAS, the EDA has examined the financial stateinents and finds them to be acceptable as to both form and accuracy; and EDA Minutes 11age 2 November 5, 2012 WHERE EAS, the EDA Commission has othernicans, to verify the intentot'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 Corninissioners of the Columbia Heights Econornic Development Authority that it has exarnined the referenced financial statements including the check history,, and they are found to be correct, as to forin and content; and BE IT FURTHER RESOLVED the financial staternents 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 rnade a part of the permanent records of the Columbia Jr- lei ghts [conornic Development Authority. Passed this 5th Day of Novernber, 2012 MOTION BY: Dielini SECONDED BY: Nawrocki AYES: All ayes ...... . ...................... Gary Peterson, President Attest By: Shelley Manson, Secretary BUSINESS ITEMS 4. Grand Central Loft "rowan Homes Prop osa ll-Synergy Land Company Cartney explained that in 200' ), 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 I () townhouse units built and one condo building. The townhouses are platted as individual lots with zero tot line setbacks. This proposal would be part of phase two of the townhouse portion of the development that is unfinished at this time. PR10POSAl_,: 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 UllitSAOtS. The applicant proposes to reduce the number to 9 and create detached single family hornes instead of attached townhonies. The proposed lots will be slightly larger than what was previously approved at 3,150 square feet (original is 2,46(lsq. ft.). The proposed single family homes will have similar architecture and earth tones to complement the existing buildings and will be part of the flonae0wrier's Association. EDA Minutes Page 3 November 5, 2012 These changes constitute a pre] ii-ninary and final plat, and site plan review approval, The changes to this proposal are minor in nature and are before the ED A in order to determine if the proposal still meets the spirit and intent of the original development. Staff recommends, the proposal move forward to the Planning Commission and City Council for Preliminary Plat and Site Plan Review as proposed. Cartney then introduced Brent Hislop from Synergy Land Company and Christopher I lags from EXIT Real Estate Group. She reminded members they are not approving a Site Plan at this time, just giving a pretirninary opinion whether they would consider this project as proposed. Questions by members: Peterson asked who currently owns the property. Hislop told hint that Dave Klober is still the owner, but there is purchase agreernent with Tier 2 who hopes to develop the site as described. Tier 2 will, provide the funding, Synergy will act as the developer and possible builder, and Exit Realty Company will do the marketing. Nawrocki asked Hislop and Haas why they wanted to do this project. Hislop said as a developer /builder; lie believes the detached style townhornes, will sell. Ile said the concept remains the same, the only difference is a change in the style of each townhome. He explained that the townhornes will be part of the Current ]ionic owner's association and that the common areas will be maintained by the association. Nawrocki asked if the taxes were current on the property. Clark said yes, and those details would be resolved before closing in order to get a clean title to the property. Peterson stated lie was glad to see someone interested in developing these lots and didn't have any issues with the concept. Ifislop then reviewed a couple of difflerent styles that would be similar to what he is proposing to be constructed on these sites. He said the styles could vary slightly depending on the builder for each lot, but they would blend with the existing townhomes. Szurek told 11islop that she would like to see the exact styles that would be constructed on the sites Nvhen the Site flan is brought before the Planning & Zoning Commission for approval. She said the members would not approve a"bl'anket concept," that the various styles would need to be decided upon first. Hislop said that would be hard to establish since different builders may be used so it is hard to dictate what style each lOt',V'(,)Llld have. She told him it would be necessary to narrow itdown to 2 or styles in order to get the Site Plan approved. The general consensus was to, approve the concept and tor them to proceed to subrnit plans to staff for the various approvals. EDA MINUTES Page 4 November 5, 2012 5. Scattered Site Realtor RFP Review At the August 20112 EDA meeting the FDA 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 (which reaches more than 6,(100 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 oMarketing Plan * MLS listing * Sign installation * Listing on Facebook and Craigs List * L,isting on EdinaRealty.com then fed to other websites 0 Website stars ernailed to seller 0 Review trends in marketplace *Fee Schedule 0 7.31/10 per lot 0 2,7% to selling broker a, 10% Total 2) Darcy Gedney-Peoples Realty., licensed realtor since 2002. e Has Nvorked and lived in Anoka. County for over 20 years e Marketing Plan • MI.'S listing • Sign installation • Advertise all properties on multiple webpages • Communication is key eFee Schedule 0 4.5% per lot (total) 0 2.7% commission to buyer 0 Administration fee of $250 per closing 3) Jason Borowitz - fishMLS Realty, licensed realtor since 2001 • Has worked in Anoka County for 7 years • Marketing Plan • MLS listing • Sign installation • Real Estate Magazine ne • Provide a marketing report every 21 days el"ce Schedule 0 5% Per lot or minimum of$2,000 0 2.5% per lot or $ 1,000 min inium to cooperating broker EDA MINUTES Page 5 November 5, 2012 4) David Bichanga. — Re/Max Results- Thick Team, Reo Group, licensed since 2.005 •Has sold 4 single family homes in Columbia Heights and 9 inAnoka County •Has experience with governmental agencies • Marketing Plan • MLS listing • Internet CXPOSUre on Google and Yahoo • Personal promotion to other agents • Sign installation • Advertise in local Newspaper •Fee Schedule 0 3% of the lot price or rninirnurn 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 0 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 0 MLS listing 0 ww,coluni bial lei (_yfitsReaftA7..com 1--__-1 - — -------- 0 Listing on other webpages mm •Fee Schedule 0 4.7% of sales price of the lot 7) Chi-is 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 •MarketirC n, 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. EDA Minutes Page 6, November 5, 2012 8) AmeriBid — Auctioneers, oAuction properties on November 'JOT" el',"stimated selling price of lots range from $6,000424,000 • Marketing Plan • Sign installation • Print media and direct mailing • Digital media • Fee Schedule 0 Marketing Plan: $4,718.98 0 10% buyer's premium added to high bid and becomes part of the total purchase price AineriBid retains the 10% 9) Patti Ann Kaspe — Exit realty Nexus, license since 2005 *Experience in Anoka County Marketing Plan * MLS listing * BuildhereAIS 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 JaIlLiary EDA meeting. Staff recommends Bruce: Magnuson, Edina Realty; Eric Young, Edina Really/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 COITIMUflity Development office for review, because of the quantity and documentation type staff is not including the RP,F's in the packet. Questions b), members: Nawrocki thought we Nvere going to Put Signs up on the lots. Clark said we tried that on the four best lots. At a PreViOUS, Meeting it was decided to obtain RFP's from realtors to market thern. Clark said the Board can interview the candidates who submitted proposals and decide if this is the Course they want to follow. Cartney told members that if they decide to interview some of these candidates, the complete R information would be given to members prior to the interviews. She reminded members that we have already established guidelines for what can be built on the lots. Nawrocki asked if there is a m'in'imums price set for these lots. Cartney said that is something that can be decided at the meeting after considering the opinions of the realtors. There was a discussion on the varying fees that would be charged for marketing the lots. Cartney said that these rates were submitted as part of their proposal., they are not bids, and it may be possible for the rate to be further negotiated. EDA Minutes Page 7 N overnber 5, 20 12 Herringer asked who would be establishing the sales price. Clark responded that we did establish a preliminary C� price for four of the lots, but that is something that will be discussed further based on information on current market rates. Nawrocki asked if we would just be inarketino the Four best lots. Clark said that all of them will be marketed if they decide to move forward with this plan. Allotion 1eySchniilt, seconcled by Diehm, to authorizestqffio schedule interviews fir 1he Juntfury 20'13 ED,4 meeting will Barre Alagnuson, Edina Really; Eric Young, Edina Rea.14VYoung Real Estale Inc.; and Chris Kiinball, Best Value Real.Eslale hic. .411 oyes. X10TION PAS, E'D. 6. Consider Donation of 666 4011 Avenue Property Cartney told members that in late 2008 the Mayor received a letter from Michael 'rhoennes, property owner of 666 40"' inquiring if the City would be interested in receiving this property as a donation. Since receipt of that letter (enclosed in the packet) staff has worked with Thoennes' attorney Charles Paslike 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. ['his 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 SLU'Vey be conducted on the site to see if there are ally Unforeseen contaminants. Staff also recommends using the City's attorney to draft the purchase agreement and the Quit 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)-the scattered site district. Staff recommends the EDA accept the donation of 666 40"' Ave as long as there are no niaJor contaminants revealed in the pre-demolition survey. Que Peterson stated he was in favor of obtaining the property if no major contaminants are found, C, Nawrocki asked how 11-lUCh the 0011taniination SUI-Vey would cost approximately. Cartney stated she thought it would be around $500. 1 le then discussed the lot size and how many lots this property actually is. Clark said it is a 50 foot parcel that may be two platted lots that were combined long ago. There was a discussion about the future use of the property. It has been Suggested to demolish the structure and allow it to be an informal access to the park for now. Public works is looking into the possibility Of using the site as a ponding area. It will not be Used as a residential building; site as it is zoned Limited Business. Nawrocki stated that properties on either side of this site are residential sites and this could be re-zoned to allow that. Cartney stated that all the properties along this part of 40"' Avenue are zoned Limited Business and that the use as residential homes is a legally non- conforming use. EDA Minutes P a '- Ie VQ November 5, 2012 Allofloii by Williums, secoimle(l ley Schmitt, to tie oive the mcmliiig qfl?(-�solution 2012-15, there being cimlVe copies avr tihible to the public, All CI.Yes. A11C TION PASSED. il,folion kv Williams, seCOIMIed kv,Sehmiu, to qj)j)rove resolulioit 2012-15 auihorizhug a•cepance cif the (1wialion (?f'lhe properly loc(ved cit 666 40'1' A veimeAlorthecist hi the cif Cohvmbi6i Ht�igF,it,5,°.Iiii-117eri,)Yoie ollovvii1g, the City Mmager to enter h7lo (vay (ig-reen'ientsfiv the scinle. All qye,s. M0710N PASSM EDA RESOLUTION 2012-15 RESOLUTION AUTHORIZING THE ACCEPTANCE OF,rHE DONATION OF THE PROPERTY LOCATED AT 666 40 ""' � AVE NUE 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'y'AVCF[Ue, legal description of Lot 45 & 46 Columbia Heights Annex Subpect to Easement of Record, Anoka County 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 I 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 hind 376. NOW T IIEREFORE 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 dOCUrnents for the purpose of demolition of the subject property. Passed this 5"' day of November 2012 EDA Minutes Page 9 November 5, 2012 7. Anoka county'rax Levy Clark reminded members that oil August 6, 2012 staff presented all in-depth EDA letter to the Conu-nissioners, which included historical documents, regarding the subtiect issue. Based on the rules of engagement with Anoka County, if there is no formal action to deny the next five-year funding cycle, then the levy is automatically C� continued. If the EDA agrees to COutillLte, staff reconuriends that the City Council affirm the same through a Council resolution. At the last meeting it was asked as to how we call use these funds. Within the most general perspective, any activity that the City's EDA or FIRA can legally enter into by means of State Law, is all eligible activity. This means that any bonafide economic development program, marketing, housing programs, redevelopment Z!� activities call be funded. The funds cannot be used for general governmental expenses and salaries. The only caveat is that the Anoka County 1-IRA, which oversees, these activities, Must agree to the same that these are ``authorized" activities. In other words, their put-view 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 CD13G 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 sonic of the small existing corni-nercia.l 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. Clark is not recorriniending any of these programs at this tirne, but said the list is to gain a flavor of activities that the City could expand into and have a resource to rnatch the expenditure. From all economic development perspective, this city is going through a major shift, moving frorn a past industrial/service base to a pure service based economy. A. significant amount of jic%v businesses are first time start-ups, and tune and energy Should be spent oil how we ensure their success and equally, to identify other Opportunities that the market is not presently recognizing (!such as the restaLli-atit/at-t/eiitet-taiiimetit 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 nieclianisin to build sonic additional sources of revenue for future needs as the challenges of an aging C� aging C01111111.1flity Will guarantee that additional resources Will be necessary to bolster residential and/or commercial neighborhoods. Staff recorriniends continuation of the Anoka County Levy for an additional five years. If the City chooses to opt out, we cannot participate in this program for five years. Questions from rnernbers: Fehst said that most of the inner ring suburbs have used past tax increment to accurnulate significant funds for redevelopment projects., but Columbia Heights has not done that. He expressed his opinion that we need to establish reserves in order to purchase properties for redevelopment and this is a rticants to provide that funding. He agrees that the administration fee the County charges for handling these funds is too high, however as an alternative to Our City Council not raising taxes to provide funding for redevelopment, we should probably continue on with this levy program. Williams asked if we could do Our own tax levy to provide the funds. He would like to see us receive the tax dollars directly and not have to pay all administration fee. Clark told hire it is too late for this ),car's levy, but we could increase the levy next year, but we wouldn't be able to raise quite as much money as this Anoka County levy provides. The most we could probably raise would be EDA Minutes Page 10 November 5, 2012 $100,000/year and the Anoka County levy provides approximately $170,000/year. Felist stated that if levy limits were imposed, it would limit the amount We Could levy even more. Nawrocki stated the total amount paid by taxpayers over the last five years has been approximately $1 million and the County will keep $150,000 of that money, and we haven't used it for anything yet. Peterson stated if we proceed with the purchase of Mady's or any other sin-iflar site, this the funding we will use and it will be depleted. Clark said we began with the Anoka County I..,evy Program to reserve funds for the redevelopment of 37'h and Central, a GMI-IC contract for a house on 2 nd Street, and the possible redevelopment of the Mad 's site. Nawrocki said the City has other unallocated funds that should be used. There was a brief discussion as to whether the funds he referred to are allocated or not. Uerringer asked if the proceeds from the sale of Parkview Villa Could be used to establish our own. fund. Clark said that there has been some preliminary discussion to possibly consider those proceeds as a potential funding source for a new library, and not redevelops -ient. Schmitt said her biggest concern would be that Anoka County decides to withhold the funds from us when we request to use it. Clark explained they can't do that as it is collected by them on Our behalf. We get the funds issued to LIS When we apply for payment, once we get a project to pay for that is an approved use of the funds. Fehst told members that we have a good working relationship with the County and they have Z:� provided other funding to us which helps offset the administration fee they keep for this particular program. Szurek asked. if there was also a charge for the other funding we receive. Clark said the County takes an initial administrative fee prior to a given pool of dollars being set for competition, especially if it is ;provided by Federal dollars. Dielim asked what other communities are doing. Clark said that all the small cormi-itinities within Anoka County are continuing with the program. The larger communities are doing their own tax levies for redevelopment or using other funds. Motion kv Nmvroeki, secon,ded lay .�chtnilf to not continue With the Anoka County Levy, Prograin. Roll ("all: ayes-Schmill, Nawrocki, Tlerringer. Diehin, Williams, Peterson AIO TION IVA ILI; Diehrri asked if we could participate for a period less than dive years. Clark didnt think that was possible but he would research that and would also try to get the County to agree to a reduced fee of 1.0%, rather than 15010. Schmitt Would like to see us start our own redevelopment fund as Mr. Williams has suggested. Nawrocki stated there is an alternative way to put money in the frond. He suggests reducing the budget further and put the excess money in the redevelopment furid. Other members said the budget is already "cut to the bone" and there isn't any place they would recomn'lend cutting further. EDA MINUTES Page I I November 5, 2012 Nawrocki then asked how it was determined that this is an EDA decision and not a Council decision. Clark said that five years ago when the program started it was approved by both the EDA and the City Council. It was decided to do the saine thing this year. Williams said we should find a way to do this ourselves before it has to be renewed five years from now. Motion by S'zurek, seconclect by °chtnitt, to awhorize slqf e ,flo subinii a I iter qj"acknoi44cedgement to Anoka (7(mq)) that the ity will continue i0th the Anoka Counly Economic Development Levy. Roll C'U//: qves- &urek, Diehm, Herringer, Williams, Peterson Nop-S•hinitt, Nitivrocki AIOTION PAS,VD. 8. Administrative Report Clark asked if the EDA desires to have another Special Meeting to consider a Purchase Agreement with the Z= owner ofMady's as the owner approached staff this week and wants to enter into negotiations for the property once again. Clark suggested mee6ig at 6:30 pin on Tuesday, November 13, 2012 prior to the City Council Z:lg meeting. The next regular ED,A meeting will be Tuesday, December 3, 2012 at City Hall at 6:30 pm. The meeting was adjourned at 7:52 pm. Respectfully submitted, Shelley Hanson Secretary