07-14-10 Council Workshop Minutes

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MINUTES CITY COUNCIL JULY 14, 201.0 The workshop meeting was reconvened at 8:22 p.m. VIKING The City Administrator reported that Elhers & Associates prepared TIF DRIVE projections for the proposed development of the Viking Drive property PROPERTY at Rice Street. The Administrator reported that the Abdo's are projecting AT RICE & a $1.588 million value for their proposed project. That should generate about HIGHWAY 36 $125,000 in present value'F1P dollars. Lhlers also used a value of $1.4 million based on projected County valuations, and that project would generate approximately $65,000 in TIF revenue. The Administrator noted that Abdo's are requesting awrite-down in land costs of approximately $70,000 from our $400,000 asking price. This coupled with the cost of creating the TIF District would leave little to cover administration costs at the lower value estimate. "Fhe Administrator indicated that while financially this seems to be workable, the numbers would be tight. Blesener asked if the Council was willing to write down the land costs from the $400,000 value that was established for the property. There was discussion about whether or note there was a better development potential for this property. The Administrator reported that he discussed this with Reg Plowman of RJ Marco who indicated that the property could be a good single-user office building site. However, given the market, Plowmaiz was not sure how quickly such a development would occur. "I"he Administrator reported that the City sold the smaller Viking Drive site for about $6.50 per square foot and is asking just under $10 per square foot for this one acre site. It was noted that this site has visibility to Rice Street. Blesener asked how many users the Abdo's were projecting as part of their development. Paul Abdo responded that there was the potential for four users. Keis indicated that he was willing to sit on the site until the Rice Street/Highway 36 bridge and road construction project were completed. Keis expressed concern with the use of TIF noting the length of time before additional tax revenue would be generated from the site. McGraw pointed out that this is a unique piece of property to the community located at a gateway point into the City. McGraw stated that he supported holding the site until the Rice Street project was completed. Abdo asked what the Council's vision for the property was in considering this a gateway location. He asked if the vision was for an upscale building or did it have to do with the type of user on the site. Keis indicated that for him most of the concern was with the use of TIF. It was noted that the Subway, Culvers, and CVS projects all developed without TIF. Keis stated that if TIF is appropriate, he had no problem with utilizing it. However, he was not sure that TIF was appropriate for the project as proposed by the Abdo's. 8