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EDC Minutes June 18, 2004 Page 2 $130,000. Johnson noted that in spite of the cold weather, the Spring Golf Tournament was a success and generated increased revenues for the Chamber. D. Report of Staff: 1. Final Plat and Approval of the Hidden Hollow Purchase & Redevelopment Agreement—Pro Craft Development: On June 14th the Mounds View EDA voted 5 to 0 to approve the Purchase & Redevelopment Agreement for the Hidden Hollow project. Also on Monday the developer’s lender, Cherokee Bank, provided a letter indicating it had approved full funding for the new housing subdivision. The next step for the project in on June 28th, the final plat will be considered by the City Council. Kurt Ulrich, the City Administrator came into the Council Chambers for the meeting. 2. Final Plat and Land Closing—Velmeir Companies (CVS Pharmacy): The sale was planned for the end of June, however, the issue of stormwater management has delayed things. Backman described Loucks (Velmeir’s architects) interaction with Rice Creek Watersehd District. Loucks had submitted it application to RCWD in April only to find out that the day before the RCWD Board was going to review (June 9th) that it was not complete. With additional stormwater management costs, the developer is looking at $50,000 to $100,000 of additional expenses that it had not anticipated. The cost overrun threatens the project. Backman has discussed the situation with Velmeir to try to find a solution. Field asked if TIF assistance could be provided to Velmeir so as not to lose the project and the potential investment. Backman replied that he would discuss the idea with Jim Ericson. Ulrich stated that he thought the City providing TIF assistance was a good idea in this case, and mentioned that the RCWD is a problem for the City. He added that the City will be talking to over cities regarding RCWD policies. Backman mentioned that the City could participate in demolition and stormwater management costs. 3. Rescinding of the Termination of the Development Agreement between the Mounds View EDA and Michael Investments for the Building N Project: In April the City approved an amendment to allow religious organizations within the PUD, and the owners asked to be released from their obligations under the Development Agreement. On May 10th the EDA approved the termination of the Development Agreement between the EDA and Michael Investments. Subsequently on May 14, 2004, the owners of the building indicated that it was their intent to be released from the obligations (e.g. indemnification), but not to terminate the Agreement and stop future developer payments (even after the sale of the property in Mid- June 2004). Backman sought legal advice from Briggs & Morgan. A May 19, 2004 memo outlined three options for the City to consider: 1) Modify the terms of the Agreement to specifically release Michael Investments from any indemnification obligations and the City retains any future developer payments. 2) Rescind the termination of the Development Agreement and continue making developer payments to Michael Investments (most likely for August 2004 and February 2005). 3) Return to the plan as set forth in the Purchase Agreement where the Agreement and TIF Note are assigned to the church, BBC assumes Michael Investments, and Michael Investments is entirely released. The EDA could then negotiate with the church to terminate the Agreement. On May 24th the EDA decided to rescind the termination of the Development Agreement, meaning it stays in force and that Everest receives at least two more developer payments. On June 15th the building was sold to Bethlehem Baptist Church for $5.6 million and they now control the building. 4. Purchase Agreement for Acquiring Gas for Less (2525 Co. Hwy 10): Backman provided an aerial photograph of the site to the Commissioners. On April 26, 2004 the Mounds View Economic Development Authority authorized staff to proceed with an appraisal of the