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Item No. 6A <br />Meeting Date: July 26, 2004 <br />Type of Business: EDA <br />WK: Work Session; PH: Public Hearing; <br />CA: Consent Agenda; EDA: EDA Business <br /> City of Mounds View Staff Report <br /> <br />To: Mounds View Economic Development Authority <br />From: Aaron Backman, Economic Development Coordinator <br />Item Title/Subject: Resolution No. 04-EDA-191, Approving the <br />Development Agreement to Provide $75,000 in <br />Tax Increment Financing (TIF) Assistance to <br />Velmeir Co., LLC to facilitate the Redevelopment <br />of the Amoco Property located at 2800 County <br />Highway 10 in Mounds View <br /> <br />Date of Report: July 26, 2004 <br /> <br /> <br />Background: <br /> <br />The commercial site at 2800 Co. Highway 10 was formerly an Amoco gasoline <br />station and has been vacant for over three years. Three underground storage <br />tanks, the associated piping and contaminated soils were removed from the site <br />in June of 2001. For over a year the Velmeir Companies, a Michigan <br />development group, has been working to redevelop the site for a 13,000 sq. ft. <br />CVS Pharmacy facility. Velmeir has negotiated purchase agreements with <br />Amoco and all adjoining property owners, prepared and submitted site plans to <br />the City, obtained preliminary and final plat approval from both the Planning <br />Commission and City Council. <br /> <br />The current total project cost is over $3.65 million, which exceeds the project <br />budget as set by the end user (CVS Pharmacy). Unexpected additional costs <br />during the past two months have been added to the site development costs. In <br />particular, Rice Creek Watershed District (RCWD) has added over $106,000 in <br />stormwater management costs. In a June 22, 2004 letter John Kauppila, Director <br />of Construction for Velmeir, indicates that construction of the new store in <br />Mounds View is at risk unless the developer can obtain some financial <br />assistance from the City. Mr. Kauppila highlights three potential areas of <br />assistance—Demolition & Site Clearing, Stormwater Requirements with RCWD, <br />and Park Dedication Fees. The company requests a TIF grant for $75,000 that <br />could be applied to one or more of the eligible items. Velmeir indicates that if the <br />amount is provided they are still over budget and absorbing costs, but they will <br />commit to moving forward with the development.