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HomeMy WebLinkAbout05/23/1988 Council Minutes1 COUNCIL WORK SESSION MAY 23, 1988 A special work session of the Lino Lakes City Council was called to order by Mayor Benson at 6:39 P.M. Council Members present: Bisel, Bohjanen, Reinert. Council Members absent: Neal. City Planner, John Miller; Administrator, Randy Schumacher; Engineer, Ron Stahlberg and Clerk - Treasurer, Marilyn Anderson were also present. Mayor Benson explained the purpose of this work session is to discuss Mr. Arvid Gearman's Rice Lake Estates refinancing of temporary bonds and future development. Mr. Schumacher reviewed his memorandum to the Council dated May 23, 1988 outlining the historical facts on this development, the developer's agreement and recommendations for improving the possibility of completing the subdivision. He told the Council that he has met with Mr. Gearman who feels that there is not the market for manufacturing housing as there was four years ago. He is requesting that this City work out a method whereby he can sell his lots to developers for stick -built homes. Mr. Reinert felt that the problem is not just manufacturing housing but also marketing. He cannot compete with area builders and should have stuck with homes in the $80,000 to $100,000 price range. Mr. Bisel was concerned about protecting the property values of the homes already built. Mr. Reinert was also concerned the other developers would be upset because Mr. Gearman would be allowed to build stick -built homes on sub- standard lots. Mr. Schumacher noted that Mr. Gearman has provided a cash guarantee of $365,000 and there is approximately $200,000 in the fund from prepaid special assessments. His concern is that the temporary bond has to be refinanced this fall. Mr. Gearman has already missed three years payment of taxes and special assessments. Therefore, according to the developer's agreement, the City has the right to start foreclosure procedures. Mr. Reinert asked what price range homes would the stick - built home be. Mr. Schumacher said that they would stay in the higher price range. PAGE 1 053 054 COUNCIL WORK SESSION MAY 23, 1988 Mr. Gearman and Mr. Tim Keenan arrived and Mayor Benson updated them on this discussion. Mr. Gearman explained his present situation. He noted that he has now sold three of his models below cost. He felt there was a "stigma" on manufactured homes and told the Council that if he were allowed to build stick -built homes he could sell his lots in large blocks to area contractors. Mr. Reinert explained his concern regarding putting an equal value stick -built home next to the manufactured home. Mr. Gearman said he felt his manufactured homes would not suffer any loss since they do not look like manufactured homes. Mr. Keenan felt that the people there now got a good deal since they bought the home below cost. He felt the present homes would only be devalued if someone brought in a $40,000 manufactured home. Mr. Reinert felt that if a person was offered a stick -built home or an equal valued manufactured home, they would choose the stick -built home. Mayor Benson explained that this City is concerned with the upcoming bond issue and the Council has not had time to review all the problems involved. Mr. Gearman explained that he is willing to donate two lots for park purposes and would guarantee a couple builders will buy lots. Mayor Benson asked if the City does this how will the City deal with other builders who have had to build according to Code. Mr. Miller summarized the matter listing potential problems if Mr. Gearman is allowed to build stick -built homes. He recommended that the City rezone the property to PUD with certain requirements that will protect the property owners who are already there and insure that he will not have a competitive advantage, with langauge regarding minimum lot size, minimum value, extra land or cash for park purposes. This will get the area developed. Mr. Bisel asked how the integrity of the development can be protected. Mr. Miller said this could be spelled out in the PUD plan. Mr. Bisel asked about a time table. Mr. Miller said this would depend on the public hearing but felt probably it would be a least 60 days before it could be in place. Mr. Hawkins said that Mr. Gearman could begin selling lots contigent upon City approval. Mayor Benson said the City would consider this proposal providing that, 1) individual owners in Rice Lake Estates are contacted prior to the public hearing on the rezone, 2) Planner, Administrator and Mr. Gearman draw up the PUD with restrictions (Park Board and P & Z Board to be involved). PAGE 2 1 1 1 1 COUNCIL WORK SESSION MAY 23, 1988 The concept should go to the P & Z Board on June 8th and the Park Board, June 6th and then come to the Council on June 13th and set the public hearing for July llth. Mr. Hawkins suggested that the ordinance for the rezone could be passed by the Council on an emergency basis. This would eliminate the need to wait the extra thirty days before the rezone would be effective. Mayor Benson asked that Mr. Schumacher and Mr. Miller handle the written matters such as the notice to the current home owners in Rice Lake Estates and then forward it to Mr. Gearman to put in place. Mayor Benson closed the work session at 7:27 P.M. Approved this 23rd day of May 1988. MARILY G. ANDERSON Clerk- Treasurer PAGE 3 BE JAMIN G. BENSON Mayor 055