HomeMy WebLinkAbout20190903_EDA_minutesECONOMIC DEVELOPMENT AUTHORITY (EDA) MINUTES OF THE MEETING OF
SEPTEMBER 3, 2019
The meeting was called to order at 6:00 pm by President Szurek.
Members Present: Murzyn, Schmitt,
Buesgens, Novitsky, Herringer, and Szurek.
Members Absent: Williams
Staff Present: Kelli Bourgeois (City Manager), Aaron Chirpich (Community Development Director), Mitch Forney
(Community Development Coordinator), and Shelley Hanson (Secretary).
PLEDGE OF ALLEGIANCE- RECITED
CONSENT AGENDA
1. Approve the minutes from meeting of August 5, 2019.
2.
Approve Financial Report and Payment of Bills for July 2019-Resolution 2019-14
Herringer questioned payment to NE Bank detailed on page 9 for $2,654,463.88. Chirpich explained that
was the wire transfer of funds to purchase 3989 Central Avenue NE.
Motion by Herringer, seconded by Novitsky, to approve the consent agenda as presented. All ayes. MOTION PASSED.
RESOLUTION
NO. 2019-14
A RESOLUTION OF THE ECONOMIC DEVELOPMENT AUTHORITY OF COLUMBIA HEIGHTS, MINNESOTA, APPROVING THE FINANCIAL STATEMENTS FOR THE MONTH OF JULY 2019, AND THE PAYMENT OF THE
BILLS FOR THE MONTH OF JULY 2019.
WHEREAS, the Columbia Heights Economic Development Authority (the “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 statement for the month of July 2019 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
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Sept 3, 2019
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.
ORDER OF ECONOMIC DEVELOPMENT
AUTHORITY
Passed this 3rd day of September, 2019
Offered by:
Herringer
Seconded by:
Novitsky
Roll Call:
All ayes
President
Attest:
Recording
Secretary
BUSINESS ITEMS
6/7. Economic Development Authority Budget and Tax Levy-Resolution 2019-15 AND
Housing & Redevelopment Authority Tax Levy-Resolution 2019-16
Chirpich
explained that on August 26th, 2019, the proposed budget for the 2020 fiscal year was distributed to the City Council (the “Council”) of the City of Columbia Heights (the “City”). Before
the City Council completes their review of the proposed budget later this fall, the Columbia Heights Economic Development Authority (the “EDA”) and the Housing and Redevelopment Authority
in and for the City of Columbia Heights (the “HRA”) are required to adopt fund budgets for Fund 204: EDA Administration and Fund 408: EDA Redevelopment Projects; and to authorize their
respective 2019 tax levies, payable in 2020.
Overall, the proposed 2020 fund budgets are balanced, with funds specifically dedicated to maintain existing projects and initiatives,
as well as allocating funds for programs that reflect the priorities of the EDA, such as the Commercial Revitalization Project and the Façade Improvement Grant Program. It is worth noting
that the proposed EDA budget for 2020 accounts for several staffing changes within the Community Development Department that are reflected in Fund 204. These staffing changes are detailed
in the comment section of the Fund 204 summary budget that is attached to this report.
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Sept 3, 2019
The EDA effectively has two separate tax levies after the City
Council granted the EDA certain HRA powers in 1996. One tax levy is administered by the City under Minnesota Statutes, Section 469.107 on behalf of the EDA (the “EDA Levy”) and the other
is a special benefit tax levy administered by the EDA under Minnesota Statutes, Section 469.033 on behalf of the HRA (the “HRA Levy”). The proposed fund budgets reflect both levies at
their respective statutory caps of 0.01813 and 0.0185 of the City’s estimated market value. The EDA Levy would capture $245,100 from the City’s estimated market land value; whereas the
HRA Levy would net $250,100. When combined, both levies result in total net revenue of $495,200 in 2020.
Staff recommends approval of Resolution 2019-15 and Resolution 2019-16 as presented.
Questions from Members:
Schmitt questioned what the policy is for maternity leave. Bourgeois stated that under FMLA guidelines, employees are allowed 12 weeks of leave. Vacation
and sick leave are used during this time period and if that is exhausted, then the leave is unpaid. Chirpich stated the position that will be using maternity leave is funded out of
a different fund than the salaries included in the budget review of fund 204 being discussed at this meeting. The salary of the City Planner is now being funded by the General fund
which allows more money for the 408 fund. And salaries of the building department come out of the 201 fund.
Schmitt asked if the capital outlay fund accumulates over the years unless
it is used for something, and she wanted to know that if a property purchased with those funds sells in the future, do the proceeds return to fund 408. Chirpich and Kloiber told members
that the funds received at the time of sale would go back into the 408 account and could then be used to purchase additional properties.
Motion by Schmitt, seconded by Buesgens, to
waive the reading of Resolution 2019-15, there being ample copies available to the public. All ayes. MOTION PASSED.
Motion by Schmitt, seconded by Buesgens, to adopt Resolution 2019-15,
a resolution of the Columbia Heights Economic Development Authority, adopting a budget for the fiscal year of 2020 and setting the 2019 tax levy, payable in 2020. All ayes. MOTION
PASSED.
Motion by Schmitt, seconded by Buesgens, to waive the reading of Resolution 2019-16, there being ample copies available to the public. All ayes. MOTION PASSED.
Motion by Schmitt,
seconded by Buesgens, to adopt Resolution 2019-16, a resolution of the Columbia Heights Economic Development Authority, adopting a budget for the fiscal year of 2020 and authorizing
a special benefit tax levy, payable in 2020. All ayes. MOTION PASSED.
RESOLUTION NO. 2019-15
A RESOLUTION OF THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY, ADOPTING A BUDGET
FOR THE FISCAL YEAR OF 2020 AND SETTING THE 2019 TAX LEVY, PAYABLE IN 2020.
BE IT RESOLVED, by the Columbia Heights Economic Development Authority (the “EDA”) as follows:
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4
Sept 3, 2019
WHEREAS, the City of Columbia Heights (the “City”) established the EDA by an enabling resolution adopted on January 8, 1996, pursuant to Minnesota Statutes 469.090 to
469.1081 (the “EDA Act”); and
WHEREAS, the City Council of the City has given to the EDA the responsibility for all development and redevelopment projects and programs; and
WHEREAS,
under Section 469.107 of the EDA Act, the City is authorized to levy a tax for the benefit of the EDA on its area of operation for the purposes authorized under the EDA Act, subject
to the approval of the City Council.
NOW, THEREFORE BE IT RESOLVED, by the Board of Commissioners of the Columbia Heights Economic Development Authority, that the EDA adopts and requests
the City Council’s approval of its budget in the amount of $489,200 for 2020; and
BE IT FURTHER RESOLVED, that the EDA adopts and requests the City Council’s approval of its tax
levy in the amount of $245,100 for taxes payable in 2020; and
BE IT FURTHER RESOLVED, that the Executive Director is instructed to transmit a copy of this resolution to the City Manager,
Finance Director, and City Clerk of the City of Columbia Heights, Minnesota.
ORDER OF ECONOMIC DEVELOPMENT AUTHORITY
Passed this 3rd day of September, 2019
Offered by:
Schmitt
Seconded by:
Buesgens
Roll Call:
All ayes
President
Attest:
Secretary
RESOLUTION NO. 2019-16
A RESOLUTION OF THE COLUMBIA HEIGHTS
ECONOMIC DEVELOPMENT AUTHORITY, ADOPTING A BUDGET FOR THE FISCAL YEAR OF 2020 AND AUTHORIZING A SPECIAL BENEFIT TAX LEVY, PAYABLE IN 2020.
BE IT RESOLVED, by the Columbia Heights
Economic Development Authority (the “EDA”) as follows:
WHEREAS, the City of Columbia Heights (the “City”) established the EDA by an enabling resolution adopted on January 8, 1996, pursuant
to Minnesota Statutes 469.090 to 469.1081 (the “EDA Act”); and
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Sept 3, 2019
WHEREAS, the City Council granted the EDA all powers and duties of a housing and redevelopment
authority by an enabling resolution and ordinance adopted on October 22, 2001, pursuant to Minnesota Statutes 469.001 to 469.047 (the "HRA Act"), except certain powers that are allocated
to the Housing and Redevelopment Authority in and for the City of Columbia Heights (the “HRA”); and
WHEREAS, under Section 469.033 of the HRA Act, the EDA and HRA, are authorized to
levy a special benefit tax, in an amount not to exceed .0185 percent of the City’s estimated market value (the “HRA Levy”); and
WHEREAS, the EDA desires to maintain its HRA Levy at
the amount of .0185 percent of the City’s estimated market value as authorized by the HRA Act; and
WHEREAS, the EDA understands that the HRA does not expect to levy a special benefit
tax for the fiscal year of 2019; and
WHEREAS, the EDA has before it for consideration a copy of its budget for the fiscal year of 2020, and the amount of the HRA Levy, payable in 2020,
is based on said budget.
NOW, THEREFORE BE IT RESOLVED, by the Board of Commissioners of the Columbia Heights Economic Development Authority, that the EDA hereby adopts and requests
the City Council approve its budget in the amount of $489,200 for 2020, and such budget includes both the amount the EDA requests to be levied by the City under Section 469.107 of the
EDA Act, and the amount levied by the EDA under Section 469.033 of the HRA Act; and
BE IT FURTHER RESOLVED, that the EDA hereby directs staff to file its budget with the City in accordance
to Section 469.033 of the HRA Act, and take such actions necessary to levy and certify the HRA Levy in the amount of $250,100 for taxes payable in 2020.
ORDER OF ECONOMIC DEVELOPMENT
AUTHORITY
Passed this 3rd day of September, 2019
Offered by:
Schmitt
Seconded by:
Buesgens
Roll Call:
All ayes
President
Attest:
Secretary
8.
Acquisition of 230 40th Avenue – Resolution 2019-17
Chirpich told members that for the past four months, the EDA and staff have been negotiating the potential acquisition of 230 40th
Avenue NE as part of the EDA’s Commercial Revitalization Program. The Commercial Revitalization Program was created to rejuvenate commercial corridors throughout the city by purchasing
nonconforming residential structures in commercial zoning districts. The primary goal of the program is to eliminate the nonconformities and make room for new commercial development.
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After deliberation at multiple EDA meetings, and several conversations with the property owner, both parties have tentatively agreed to a purchase
price of $275,000. A summary of the purchase negotiations is listed in the table below.
EDA Offer History
Seller Counter-offer History
$200,000 – initial offer by EDA
$510,000
– counter by seller
$250,000 – counter by EDA
$300,000 – counter by seller
$275,000 – best and final offer from EDA
$275,000 - accepted by seller
Staff estimates that the
market value of the property is somewhere in the range of $230,000 to $250,000 based on research of comparable properties in the vicinity of the subject site. Staff is comfortable with
the negotiated purchase price of $275,000 given that the site is contiguous with other EDA owned properties in the area. Therefore, acquisition of 230 40th Avenue will further the EDA’s
land assembly efforts along the University Avenue corridor.
Chirpich reminded members that there was a difference of opinions about whether the Board should move forward with this
purchase or not at the last meeting. This information was relayed to the seller who accepted the tentative purchase price of $275,000 if it was formally approved by the Board.
Copies
of the purchase agreement were included in the agenda packets for the members to review.
Staff, therefore, recommends approval of Resolution 2019-17 as presented if the Board wants
to gain control of that corner piece for future development. Chirpich told members that if approved, the sale would close by mid-December. He also stated that there would be additional
costs that he estimates to be between $15,000-$20,000 after the purchase to do demolition and to get an environmental assessment of the property.
Questions/comments from members:
Herringer
again recused himself from any discussion or voting on this matter.
Buesgens is ok with the amount to purchase this property. She was confident we would get most of it back once it
is sold to a developer. She realizes this is a long term project.
Schmitt stated there will probably be lead based paint and asbestos issues that will need to be disposed of properly
at the time of the demolition. Chirpich said that is not a cost prohibitive issue for the demo of a house this size, and that he had included that in his estimate given earlier.
Murzyn
was concerned about the cost to do soil contamination cleanup if anything has spread from the Root property. Chirpich stated that is an unknown factor at this point. Kloiber questioned
whether the EDA/City would be responsible for these costs either way since we own the Root property and are aware that the site does have some contamination.
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Sept.
3, 2019
Forney stated that the environmental consultant doesn’t think the contamination has spread beyond the Root property since no construction has taken place whereby soils were
altered or spread in anyway. The only part he was concerned about was near the property line where the shed is located. There may be some minimal top soil contamination there. It
was noted that CDBG funds already granted for the Root Cleanup cannot be used on this property. We would have to make another request for additional funds if need be.
Novitsky stated
he is still against the purchase.
Schmitt asked if there was a well on the property, and if so, how that would be handled. Chirpich said it would be capped and sealed and would be
recorded with the Dept of Health. The cost of doing that generally runs between $800-$1500.
Schmitt stated that we’ve purchased several properties over the years and we don’t make
money doing so. But we’ve achieved the goal of improving the property and in improving neighborhoods. She said that once a new home is built, it usually instigates neighbors to make
improvements also.
Szurek stated she is in favor of the purchase. She felt it is better to control the site as it’s a corner piece of a larger re-development area than to let it be
sold to another party who may use it as a residence for many years to come. She also stated this is a long term goal for the city, not something that will be realized within a few months.
Motion
by Schmitt, seconded by Buesgens, to waive the reading of Resolution 2019-17, there being ample copies available to the public. All ayes. MOTION PASSED.
Motion by Schmitt, seconded
by Buesgens, to adopt Resolution 2019-17, a resolution approving the purchase agreement between the Columbia Heights Economic Development Authority and Lucille M. Dudziak, trustee.
Ayes:
Buesgens, Schmitt, Szurek
Nays: Novitsky, Murzyn
Abstain: Herringer MOTION PASSED.
COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY
RESOLUTION NO. 2019-17
RESOLUTION APPROVING
PURCHASE AGREEMENT BETWEEN THE COLUMBIA HEIGHTS ECONOMIC DEVELOPMENT AUTHORITY AND LUCILLE M. DUDZIAK, TRUSTEE.
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 and Lucille M. Dudziak, Trustee (“Seller”) desire to enter into a purchase agreement
(the “Purchase Agreement”) pursuant to which the Authority will acquire certain property in the City located at 230 40th Avenue NE (the “Property”) from the Seller for economic redevelopment
purposes. The Property is described in Exhibit A attached hereto.
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Sept 3, 2019
1.02. Pursuant to the Purchase Agreement, the Authority will purchase the Property
from the Seller for a purchase price of $275,000 plus related closing costs.
1.03. The Authority finds that acquisition of the Property is consistent with the City’s Comprehensive
Plan and will result in redevelopment of a nonconforming property, and that such acquisition will facilitate the economic redevelopment and revitalization of this area of the City.
Section
2. Purchase Agreement Approved.
2.01. The Authority hereby ratifies and approves the actions of Authority staff and of Re/Max Synergy acting as the Authority’s real estate broker (“Broker”)
in researching the Property and preparing and presenting the Purchase Agreement. The Authority approves the Purchase Agreement in the form presented to the Authority and on file at
City Hall, 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 Purchase
Agreement by those officials shall be conclusive evidence of their approval.
2.02. Authority staff and officials are authorized to take all actions necessary to perform the Authority’s
obligations under the Purchase Agreement as a whole, including without limitation execution of any documents to which the Authority is a party referenced in or attached to the Purchase
Agreement, and any deed or other documents necessary to acquire the Property from the Seller, all as described in the Purchase Agreement.
Approved this 3rd day of September, 2019, by
the Board of Commissioners of the Columbia Heights Economic Development Authority.
_________________________________
President
ATTEST:
__________________________________
Secretary
EXHIBIT
A
PROPERTY
/
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Sept 3, 2019
Chirpich told members that there will be a Special Meeting Monday, September 23, 2019 at 5:30 pm to discuss TIF Financing for the 3989
Central Ave site. This will take place prior to the City Council meeting.
The next regular meeting is scheduled for Monday, October 7, 2019.
Motion by Buesgens, seconded by Murzyn,
to adjourn the meeting at 6:42 pm.
All ayes.
Respectfully submitted,
Shelley Hanson
Secretary