02-23-1998 EDA - Laserfiche WebLink

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Item No. 5/4" Staff Report No. Meeting Date: 2/23/98 Type of Business: EDAB WK: Work Session;PH:Public Hearing; CA:Consent Agenda;EDAB:EDA Business Mounds View Economic Development Authority Staff Report To: Mounds View Economic Development Authority From: Rick Jopke, Community Development Director Item Title/Subject: Authorization to contract with acquisition and relocation consultant for the Mermaid Hotel/Banquet Facility Date of Report: February 19, 1998 BACKGROUND: At the February 2, 1998 work session staff discussed the current status of the of the proposed project involving the expansion of the Mermaid to include an 11,700 square foot banquet facility and a 185-room hotel. The direction to staff was to continue to work to review and refine the numbers to determine what is necessary to make this project work and that the project should go through the normal review process including review by the Economic Development Commission. • The preliminary numbers provided by the developer show a need for$700,000 of TIF assistance for the banquet facility and additional $1,000,000 for the hotel. Project costs show a total of $800,000 for land acquisition. This may be low based on the amount of land to be acquired. The hotel developer has indicated that TIF assistance for the hotel must be structured to be of"direct benefit"to the hotel development and financial program. To use the TIF funds to acquire land only is not considered to be of"direct benefit." Some TIF assistance will be needed for financing eligible building and development costs. In reviewing the project as shown on the preliminary concept plan, big unknowns at this point are the costs of acquiring three parcels and a portion of a fourth parcel and relocating existing businesses. To assist in determining these costs, staff has contacted two acquisition and relocation consultants and have received proposals from them. The acquisition and relocation consultant would handle negotiations with the property owners and work with the businesses which would be displaced by this project to find other sites and insure that they receive the benefits which are required by federal and state laws. Copies of the two proposals are attached for your review. Conworth, Inc. is proposing to provide these sevices for an estimated $2300 per property. Evergreen Land Services Co. estimates that they could provide these services for$1500 per property. An additional cost not covered in either of the proposals would be the cost of appraisals. The consultant would contract with an appraiser approved by city staff. The city would reimburse the consultant for these costs or the appraiser could bill the city directly. •