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HomeMy WebLinkAbout09/06/2012 EDAC Minutes 1 APPROVED CITY OF LINO LAKES ECONOMIC DEVELOPMENT ADVISORY COMMITTEE MINUTES DATE: September 6, 2012 MEMBERS PRESENT: J. Stranik, J. Schwartz, B. Combs, L. Masonik, M. Kassner, L. Thor, D. Johnson, C. Wagner MEMBERS ABSENT: B. Terrick OTHERS PRESENT: M. Divine APPROVAL OF MINUTES The minutes of August 2, 2012 were approved. DEVELOPMENT PROPOSALS Dominium: Ms. Divine reviewed the presentation that Dominium made to the City Council. Dominium is a national developer of affordable and market rate apartments and townhomes. They own and manage the Lakewood Apartments in Lino Lakes. They would like to build 45-50 affordable rental townhomes in the Legacy development. Mr. Stranik asked about Section 8. Ms. Schwartz said Section 8 is usually run on a county basis, getting money from the state. It’s for people who are less than the affordable group that would go into affordable housing. Usually the entire complex is Section 8, and usually 3-4 bedroom units. A lot of developers like it because it’s 100% occupancy. The rent is subsidized. You don’t have to be on welfare to get it. It’s based on the amount of income and dependents you have. Affordable housing starts at 50% of the median income. Mr. Thor questions whether a developer getting tax credits must keep a certain percent of the project available for Section 8. Ms. Divine said she will clarify whether this project could be Section 8. Ms. Divine said that the county can sell the Legacy property to an affordable housing developer for below market rate. This could be an advantage to get the property developing again. The only other times the county can do that is to remove blight and for public purposes, such as parks. Mr. Masonik asked if the city has talked to other developers about this. Ms. Divine said the city has talked to many major housing developers but has not been able to attract a market rate project to date. The city council wants to continue to discuss whether this project is what they want to see. This plan would take approximately 3 acres of the 22 remaining. Mr. Combs asked if this project could affect how the rest of the land would develop and what was intended to be there. Ms. Divine has asked developers about the effect of affordable/rental, how much is too much, but got a range of responses. What was intended to be there was always high density. A townhome project much like what Dominium is proposing was ready to go in before the recession, only it was market rate for sale housing. Mr. Combs said this isn’t that far off. Mr. Stranik said the shift in society is more toward rental. Mr. Combs said the seminar they attended said this is the exact 2 type of housing the developers were talking about. Ms. Schwartz said Dominium is a quality developer and she doesn’t think it would cause any negative devaluation. She gave the example of Woodbury where they have areas within a development that has affordable, rental and for sale. This development would make it more attractive for other developers. Ms. Divine noted that affordable rental is taxed at a lower tax rate than market rate rental. Mr. Thor said it may generate less taxes but it could be years before it developed with something else. Mr. Kassner said Dominium has already proven themselves in Lino Lakes and if the new development built with the same standards, people don’t know which is affordable and which isn’t. The city needs rooftops. Mr. Johnson said the city needed to draw more people to this area. Ms. Schwartz said the opportunity to put affordable in is easier before market rate goes in. Mr. Stranik said the city is trying to solve the debt service problem on the Legacy project and this will help. Mr. Combs said that although it may not be the perfect development that the council wants, but it meets much of the criteria the city was looking for, and it’s small enough so it might pull in other projects. Ms. Schwartz asked if they could legally deny it. Ms. Divine said the city would have to purchase the land and it has no obligation to purchase it. There may be a request for city assistance at some point, which could give the city the right to deny that request. Mr. Stranik asked if Dominium could come into EDAC and Ms. Divine will ask them. Mr. Thor noted that a family paying $1300 for rent, that’s comparable to a $250K+ home. Mr. Kassner said the Lakes development in Blaine has rental townhomes next to for sale homes. Ms. Schwartz moved that EDAC recommend to the city council that the concept of affordable/rental townhomes warrants further exploration considering the following circumstances: • The developer’s positive reputation • The plan is not dissimilar from what was originally planned on the site • Current market conditions are not favorable for most townhome developers • The financial situation of the Legacy development EDAC recognizes there needs to be further exploration of financial implications to the city. Mr. Combs seconded the motion. Motion passed unanimously. LINO LAKES ASSISTED LIVING Ms. Divine informed EDAC that the owners of the assisted living want to purchase the property (Site B) adjacent to their property to build a memory care unit. It is a preliminary proposal, and the financial issues will be difficult. They have memory care on their top floor now, and are full. Mr. Thor thinks that Site B has high commercial potential. MARKETING IDEAS Ms. Divine related Councilmember Roeser’s wish that EDAC find new ways to market the city’s competitive advantages in terms of fees and taxes. She requested that EDAC look at current materials being used and provide new ideas that they see might not be touched on. Mr. Stranik said the real competition is with Blaine, Hugo and other north metro cities. Ms. Divine challenged EDAC to come up with some new ideas. Ms. Schwartz noted the future park & ride on 35E should be marketed. Mr. Johnson said Lino Lakes is convenient for people who go north for recreation. Marketing that the city and staff are pro development is important. 3 Mr. Masonik said that the 35E/14 interchange put the gas station out of business. Mr. Wagner noted that Commissioner Sivarajah took the county engineer out to see it to get it changed. ECONOMIC GARDENING PROGRAM Ms. Divine informed the committee that Anoka County is starting this program for “Second Stage” businesses (between 6-99 employees and generates within a range of profits. The CEOs get together and exchange information. Testimonials made it sound very worthwhile. If EDAC members know of business that might be interested to let her know. CHARTER AMENDMENT Ms. Divine said the council will put a question on the ballot calling for a reverse referendum for a public improvement project rather than a referendum for any improvement that uses a combination of special assessments and general levy. It has protections for residents who can still petition to have a public improvement project on the ballot. Mr. Combs mentioned the city council meeting where it was discussed and it was very contentious with a couple of charter commission members. UPDATES Mr. Stranik asked if Ms. Divine had reached out to the banker Mr. Owens to join EDAC. She will follow up with him. Meeting adjourned.