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EDC Minutes September 17, 2004 Page 2 D. Report of Staff: 1. Street and Utility Contract Award and Construction Start—Pro Craft Development (Hidden Hollow): Things have continued to move forward. As members are aware the grading for the Hidden Hollow project began in July. The city-owned house was demolished on July 28th. On August 19th bids were received for the street and utility project (for bidding purposes Hidden Hollow was combined with the second access road project for the Mounds View Manufactured Home Community). On August 28, 2004 the City Council selected Redstone Construction of Mora to install the street (Hidden Hollow Court) and utilities. On September 2nd a Pre-Construction Meeting was held at City Hall. Currently the contractors are installing the stormwater lines. Jim Melcher, the builder, indicates that several homes of prospective buyers are now in the blueprint stage. 2. Construction Start—Velmeir Companies (CVS Pharmacy): Backman expressed satisfaction with the progress with this project. He received the grand opening of the CVS Pharmacy in Eagan and mentioned a news article that discussed other CVS stores locating in Andover, Blaine, Coon Rapids, Maple Grove, White Bear Lake, NE Minneapolis, and St. Paul. Approximately 16 store locations are being considered by Velmeir. In Mounds View, site clearance began on August 30, 2004 and the Amoco building was demolished on September 2nd. One thing Backman noticed after the site was leveled was that the adjacent PAK Building’s deteriorated look is more visible than before. The City will follow up with the owners and encourage them to improve the site. Belting asked when CVS would open the Mounds View store. Backman replied that earlier this year the developer was aiming for October/ November. Now it is projected to be around Christmas. 3. Selection of Canyon Grille as New Manager for the Mounds View Banquet Facility and Development of the New Management Agreement: After doing D&B and personal background checks on the principals, staff recommended that the City go with Canyon Grille as the new manager of the M.V. Banquet Center. On August 23, 2004 the City Council unanimously selected Canyon Grille as the new manager effective January 1, 2005. On September 1st the Mermaid communicated to the City that it was exercising its early termination clause in the Interim Agreement and that it would be done on November 1st. Instead of four months the new manager has only two months to get ready to take over the operation (inc. finalizing the management agreement, gearing up staff, ordering and installing equipment). Canyon Grille remains very interested in taking over Banquet Center management. The Mermaid also indicated that it was actively moving events from the M.V. B.C to its main location. While not prohibited under the Interim Agreement, it was disappointing for the City. Field asked about the lease amount currently projected at $5,000 per month. Backman noted that the Mermaid currently pays the City $6,000 a month and retains any lease payments from the Twin Cities North Chamber. Under the Canyon Grille proposal, the new management group would lease the whole banquet area, excluding the Chamber offices and would pay the City $5,000 a month. Additionally, the TCN Chamber would pay directly to the City $1,160 a month. Field asked about the qualifications of the equipment coming in to the M.V.B.C. Backman stated that the walk-in cooler would be new and that the convection oven would likely be refurbished. 4. Approval of the Proposed TIF Parcel Decertification (10 parcels in TIF District #2; and 1 parcel in District #1): Backman noted that the City Council has approved the decertification of 10 parcels mostly in the area around Realife Housing Cooperative. This will cost the EDA approximately 10% or $220,000 in economic development dollars, but this will be offset by increased increment elsewhere due to higher property values. The general TIF policy is that if we are not intending to redevelop an area or specific parcels, then those properties should