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Home My WebLink About05-18-2018CITY OF MOUNDS VIEW ECONOMIC DEVELOPMENT COMMISSION AGENDA 7:30 a.m. MOUNDS VIEW CITY HALL FRIDAY, May 18, 2018 1. CALL TO ORDER 2. ROLL CALL 3. APPROVAL OF THE AGENDA 4. APPROVE MINUTES from April 20, 2018 5. EDC BUSINESS A. Hear Presentation from the Center for Energy and Environment and Determine next steps for 2018 EDC Housing Goal B. Update from Comprehensive Plan Task Force Members C. Update on New Business Categories to fill vacant space 6. REPORTS OF STAFF A. Mounds View Project Updates 7. REPORTS OF COMMISSIONERS 8. NEXT REGULAR EDC MEETING – June 15, 2018 if needed 9. ADJOURN Commissioners: Chair Jim Freichels, Dan Larson, Jason Helgemoe, Gary Stevenson, Teresa Muckala, Dennis Farmer, Ken Breske City Staff: Brian Beeman, Business Development Coordinator Minutes of the Economic Development Commission City of Mounds View Ramsey County, Minnesota Regular Meeting April 20, 2018 City of Mounds View, Council Chambers 2401 County Road 10, Mounds View, MN 55112 1. CALL TO ORDER Chair Jim Freichels called the meeting to order at approximately 7:30 a.m. 2. ROLL CALL Members Present: Chair, Jim Freichels, Vice Chair, Dan Larson, Commissioners, Gary Stevenson, Dennis Farmer, Teresa Muckala, & Ken Breske Members Absent: Jason Helgemoe Staff Present: Business Development Coordinator, Brian Beeman Meeting Attendees: Gary Meehlhause, Jacob Martin, Mary Lou Egan 4. APPROVAL OF APRIL 20, 2018, AGENDA Motion/Second: Commissioner Muckala moved and Commissioner Larson seconded the approval of the April 20, 2018 EDC agenda. Motion Carried: 6 Ayes, 0 Nays 5. APPROVAL OF MARCH 16, 2018, EDC MINUTES Motion/Second: Commissioner Stevenson moved and Commissioner Breske seconded the approval of the February 16, 2018 EDC minutes. Motion Carried: 6 Ayes, 0 Nays 6. EDC BUSINESS Review Ramsey County Housing Financing Programs Mary Lou Egan from the Economic Development Department from Ramsey County provided information of available housing loan programs. The CDBG program is for low to moderate income levels and can’t be used for new construction. But can be used for the acquisition of land and job creation. There are limitations to infrastructure and Mounds View has used this in the past for Towns Edge. There are two homeowner loan programs. One for energy efficiency and the other for home safety and general improvements. The First Home program is for first time homebuyers and is income based. CDBG can also be used for business loans up to $10,000 for matching of what the bank puts in. The program is linked to job creation. Business Coordinator Beeman helped Ramsey County structure this program. The Environmental Response Fund is for soil remediation to make it shovel ready. The program can be used for gap financing for EDC Minutes April 20, 2018 Page 2 of 5 multi-family dwellings and the program is currently helping the Boulevard Apartments in Mounds View. The funds can also be used for tax forfeited properties. Chair Freichels asked about the definition of low to moderate income. Egan informed the Commission that it mean up to 80% of the Area Median Income (AMI). For a single person this is about $40,000. Commissioner Muckala asked about the County’s fiscal year. Egan responded by saying it is July 1–June 30. Muckala asked if next year’s programs will have the same level of funding as this year. Egan said the CGBG fund will have about $1.5 mill for next year. About $500,000 comes from businesses and developers. Freichels asked about deadlines. Egan said March is normally the deadline but the County will consider projects all year round. Breske asked about the business loans. Egan said they are tied to job creation. Freichels asked about Rice Creek Commons and how the funding programs would be affected by the project. Egan said the Rice Creek development has a separate set of funding that won’t affect Mounds View. Many of the programs don’t qualify if they are for new construction. Muckala asked if all the programs were loans. Egan said all but the soils remediation are loan programs. Beeman asked about multi-family programs. Egan said most property owners are not interested because of the restrictions and the vacancy rate is so low they don’t have to apply to the programs. Egan informed the Commission that Mounds View has used a program in the past for lighting and other safety features and the owner worked with the Police Department to identify high risk areas etc. The County is working with Minnesota Housing & Finance Agency (MHFA) to come up with a housing program for multi-family owners. The County also has cooperated with larger non-profit organizations to help purchase older homes, fix them up, and keep the rents low. Breske said the owners may be interested in tax incentives. Egan said they are talking with Minnesota Housing to design a program that would address this. Farmer asked if Cities have identified specific buildings and worked with the owner to get financing to fix up the property. Egan said this has happened in the past. Beeman asked about the PACE program. Egan said it is a program that property owners can update their homes through energy efficiency and they pay back the loan through property assessments. She is not aware if anyone in Mounds View has used it. Beeman asked about a County EDA levy. Egan said it is on hold and the County Board may be considering this in the future. Ramsey County is the only county in the area that doesn’t have one. Review Residential Housing Issues-Building Code Official Presentation Jacob Martin, Building Code Official presented pictures of multi-family structures in Mounds View and asked the Commission what types of issues they are seeing. Martin mentioned that the architecture and style is outdated and that may be the reason why the buildings stick out. Martin said most of the buildings are well maintained but look outdated. They may need some minor painting and landscaping to dress up the properties. Freichels asked what can be done. Martin said painting and maybe the City could develop a plan with the owners to address specific issues each year. Egan said in the past, the County has worked with Mounds View property owners to address landscaping projects. Breske said when he looked at the buildings around the city he came to the same conclusion that the buildings look outdated but they are safe. Farmer agreed that it is mostly the architecture and many of the older single-family homes have the same issues. Perhaps landscaping of homes would help improve the properties. EDC Minutes April 20, 2018 Page 3 of 5 Beeman said the Center for Energy and Environment is offering a home improvement loan, a Mobil home loan, and an emergency loan, and none of the programs are tied to income limits. In addition, the Home Energy Squad will complete home energy audits for $50. Freichels asked how many have taken advantage of the programs. Beeman said no one has taken advantage of these programs so far and the programs have been advertised on the City’s website, Facebook, Twitter, local newspaper, the City’s newsletter, and they will be setting up a booth at the upcoming Town Hall meeting. Martin said he used a similar program in Minneapolis and he had a resident take advantage of the program. Egan said it is a good idea for the inspector to distribute information not only on the City programs but also the County programs. Larson asked about the cost and burden of demolishing older homes. Martin didn’t know the costs but said it would be a good program to look into. Update from Comprehensive Task Force Members Commissioner Dennis Farmer provided the EDC with an update on the most recent Comprehensive Task Force meeting. The Task Force met March 27, 2018 and they worked on a community survey to gain a better understanding of what residents and businesses like and don’t like about the City in regards to land use and if the Comprehensive Plan is consistent with those opinions. The City is requesting an extension to the Comprehensive Plan. Farmer said that there could be resistance from the Met-Council to delay the process because other communities need to have time to review the document and an extension many not give them enough time. The Town Hall meeting will have a section on the Comprehensive Plan. The main focus is finding out what the residents have in mind and interpreting their ideas to develop the City’s land use goals. Update from Commissioner Muckala on New Business Categories to fill Vacant Space in Mounds View Commissioner Teresa Muckala provided an update on her efforts in assisting with the new 2018 EDC goal, “Monitor & Explore New Business Categories through Trade Groups like Medical Alley and Identify Available Spaces in Mounds View with the Intent to Fill Those Vacancies with New Companies”. The idea is to attract start-up companies to fill the vacant space in some of our industrial buildings and growing them. Muckala and Beeman met with Medical Alley and Minnesota is rated number two in the country for medical companies behind Silicon Valley and ahead of Boston. Mounds View is a growing area for the medical industry and focusing on the suppliers may be the best approach. There are other areas such as Minnesota High-tech to focus on in recruiting businesses to fill vacant spaces. Beeman said most of the medical companies are situated north and south along Hwy 65 and mostly north of I-694. Many millennials are innovative and wanting to live and work in the same areas with updated amenities and working in information technology medical clusters who are looking for specialized space for research and possibly the need for clean rooms. Looking at incubator or collaborative space could be the solution to attract these millennials for start-up companies into our existing flex space. Meeting with Medical Alley has been a good start but we need to further develop where we go from here. Farmer mentioned the luxury apartments and how the Rice Creek Commons EDC Minutes April 20, 2018 Page 4 of 5 development could affect developments in Mounds View. Beeman said Mounds View has very limited space so being creative in using the existing land or repurposing land in combination with a regional economic development approach is much better that taking an individual city approach to economic development. If a nearby city has a business development and a neighboring city has the housing developments then both cities win. If those same two cities compete against each other, they could effectively take themselves out of the market and the developer may go else ware. 7. REPORTS OF STAFF Crossroad Pointe Redevelopment Project Coordinator, Beeman provided the Commission with an update on the Crossroad Pointe redevelopment site stating that staff has met with the developer and they are trying to decide which of three options to move forward for development. One option is constructing all apartments on all three parcels. The second option is to build apartments with a separate daycare facility. The third option is to build apartments and a grocery convenience store concept. The developers will be presenting the options at the Council Worksession May 7. The developers would like to get into the ground this year but if a decision can’t be made at the May 7th meeting then the development may not start until 2019. Rice Creek Commons No update was given as nothing has changed from the last meeting. North Metro Business Council The next North Metro Business Council meeting will be held at the Mermaid Event Center June 13, 2018 from 7:30-9:00 a.m. The topic will be cyber security. MWF Developers Beeman informed the Commission that he is cooperating with MWF Properties to work through the title and tax forfeiture issues and Ramsey County may be requiring additional steps to complete the purchase agreement. In addition, the investors are challenging the access easement for any new development that would occur to the west of the property. This was a requirement from Ramsey County as a compromise for the County allowing access from Mounds View Boulevard. MWF would like to continue to move forward with the goal of starting this fall. The Triton Beeman informed the commission that The Triton has requested that the Council preliminarily approve a TIF district up to $375,000 for 15 years. The Council approved the request through a resolution and the Mayor has also signed a letter of support for the project to be used for the Tax Credit application. The project would be four-stories above underground parking. Norhart Homes EDC Minutes April 20, 2018 Page 5 of 5 Norhart is looking to construct a 200 unit market rate luxury apartment building with several amenities that would attract millennials. The developers liked the Arden Park site and the five parcels southeast of the Bel-Rae Senior Living building. There are many complications with the Arden Park site like relocating the compost site, water storage, traffic, etc. There was a redevelopment plan for Arden Park in 2003. The other site has holdout homeowners that have increased their asking price to a point that is unrealistic. The City is working with Norhart to determine if any financial assistance is available and if the developers would qualify. The developers are looking to start in 2019 and may be forced to build in phases due to the holdouts. Other Upcoming Events/Reports Beeman informed the Commission that there is an open house April 25, 2018 for Parts- Midwest who is a new business located at Mustang Circle. The Town Hall meeting is April 30, 2018. Displays will open at 5:30 p.m. and the presentations will begin at 6:00 p.m. There will be water main flushing from April 23-27, 2018. Discoloration of the water could occur and residents can contact the City for more information. 8. REPORTS OF COMMISSIONERS Commissioner Breske said there is a property on Jackson & Quincy across from Lambert Park that has become an eye sour with the removal of trees and parked vehicles. A resident wants to know what can be done about the property. Beeman will address the issue with the Code Enforcement Officer. Breske looked at the properties around the city and concluded that they are in compliance for the most part and in good shape, there isn’t much that can be done with the owners. 9. NEXT REGULAR EDC MEETING Chair Freichels reminded the Commissioners that the next EDC meeting will be held May 18, 2018 at 7:30 a.m. if needed. 10. ADJOURN There being no further business, Chair Freichels adjourned the March 16, 2018 meeting at approximately 8:40 a.m. Respectfully submitted, _______________________________ Brian Beeman Business Development Coordinator Item #: 5A Meeting Date: May 18, 2018 Type of Business: EDC City of Mounds View Staff Report To: Economic Development Commission From: Brian Beeman, Business Development Coordinator Item Title/Subject: Review Single & Multifamily Residential Housing Issues Background As part of the 2018 EDC Priorities the EDC has identified the following goal: “Monitor and assist with citywide housing issues & priorities and projects and older properties as well as cooperating with multifamily property owners to assist with upgrading facilities”. The first step in this process was to identify the individual properties that are causing concern and list specific issues associated with each property. A list of code violations and trends such as landscaping, façade improvements, and some interior improvements were identified. The City's Code Enforcement Officer and Mary Lou Egan from Ramsey County presented both pictures of properties and financial incentive program information to the EDC. Terry Chaney of the Center for Energy & Environment will provide a presentation of the custom housing loan programs specific to Mounds View. Phase III of this process is for the EDC to determine what if anything should be done to complete the EDC’s housing goal. If the EDC determines that the City should move forward with any new programs then the EDC will need to make a recommendation to the EDA at the appropriate time. If the EDC is considering creating an entirely new financing program then a determination of the source of the financing will have to be made. Additionally, the EDC will need to identify specifically how the program can adequately address the identified issues. If it is determined that our existing programs can address the identified issues then that is an acceptable conclusion. Discussion The EDC should review and discuss the information and presentations that were presented to them concerning housing codes, financing programs, and any remaining issues associated with the EDC’s housing goal for 2018. Additionally, the EDC should discuss and identify any next steps if any, to complete the housing goal for 2018. Recommendation Staff recommends that the EDC review and identify any remaining issues and make a determination if any further action is needed in order to complete the EDC’s housing goal for 2018. If it is determined that further action is needed, that should come in the form of a formal recommendation to the EDA. Respectfully submitted, ____________________________ Brian Beeman Business Development Coordinator Attachments (s): 1. City of St. Paul’s Rental Rehab Program Article 2. City of Mounds View’s Housing Loan Programs Summary 3. City of Mounds View’s Home Energy Squad Summary Sheet NEWS St. Paul’s rental rehab program expands citywide after failing to draw applicants By Frederick Melo | fmelo@pioneerpress.com | Pioneer Press PUBLISHED: January 30, 2018 at 7:44 am | UPDATED: January 30, 2018 at 8:52 am The St. Paul City Council last year unveiled a $750,000 program to upgrade rental housing in St. Paul’s poorest neighborhoods. Zero-interest loans of up to $30,000 would allow landlords to rehab small, low-grade properties throughout the East Side, Frogtown, the North End and Summit- University. Mailers were sent to 1,500 property owners who met the criteria. Six months later, how the is program faring? Poorly. From August through January, the St. Paul Housing and Redevelopment Authority’s Rental Rehabilitation Loan Program drew eight applications. The program has closed on three loans with a fourth in the works, and only two of them for the maximum loan amount of $30,000. None of the four loans, which mostly covered overdue or “deferred” basic maintenance, have resulted in properties moving up a grade within the city’s rankings. Meeting as the HRA, the seven city council members discussed the lackluster results at length last week. Their conclusion? Mend it, don’t end it. Over the objections of council member Dan Bostrom, the council voted 6-1 to continue and expand the pilot program as originally planned. As of Feb. 1, rental rehab loans will now be available citywide. “These people are in business. This is their business,” said Bostrom, before voting against continuing the program. “And we’re subsidizing them. And now we’re not even fixing the worst of the worst. I can’t support it.” City council President Amy Brendmoen, who was chair of the Housing and Redevelopment Authority when the program rolled out, said the city uses low- income housing tax credits and other tools to rehab large properties all the time, and it’s time to shift resources to smaller rentals. “We do subsidize businesses. We do facade improvements. We do incentives. We do quite a bit of subsidizing of small and large businesses in the city,” said Brendmoen, whose ward includes areas of the North End and the East Side. “There’s also a restriction on the rent, so we’re also preserving affordable housing. … I don’t think there’s a lot of other cities that do this. We’re kind of learning as we go.” Council member Russ Stark, who was council president when the rental program started, said the basic concept was sound, even if the details needed fine-tuning. “One way or the other, the tenants feel the impact of the lack of maintenance,” Stark said. There are several restrictions to the rental rehab program. The loans are available exclusively to owners of small rental properties — single- family, duplex, triplex, or fourplex buildings — and landlords must agree not to raise rents more than 3 percent per year for the life of the loan. They must also get letters of recommendation from their local district councils. City staff from the Department of Planning and Economic Development said the original intent of the program was to boost the declining housing in areas of racially- concentrated poverty — low-income census tracts where racial minorities make up the majority of residents. In those neighborhoods, however, some owners of “Class A” or “Class B” properties — the highest conditions within the city’s rankings — felt they were being unfairly excluded after spending sizable sums to keep their rentals up to date. Following staff advice, the city council on Wednesday agreed that the rental rehab program will now be available to landlords of Class C and D properties — the poorest conditions within the city’s rankings — anywhere in St. Paul. The requirements will be looser in low-income, high-minority neighborhoods, where loans will be available to owners of A, B, C and D small rental properties alike. The City of Mounds View has partnered with the Center for Energy and Environment’s Lending Center to offer improvement loan programs for residents. LOW INTEREST LOAN  3% fixed rate (3.225% APR)* or 4% (4.229% APR)* Interest rate is determined by household income  $15,000 maximum loan amount  No maximum income limit  Up to a 10 year loan term  Most interior and exterior improvements are eligible MOBILE HOME LOAN  3% or 4% fixed APR rate Interest rate is determined by household income  $10,000 maximum loan amount  No maximum income limit  Up to a 7 year loan term  Most interior and exterior improvements are eligible EMERGENCY REPAIR LOAN  0% fixed rate  $5,000 maximum loan amount  The deferred loan is 100% due if the property ownership changes  Eligible improvements will be determined through a required analysis of the emergency condition of the property  Applicants must not be eligible for the low interest loan and must be current on mortgage payments and property taxes. For more information on this or other programs contact 612 -335-5884, email loaninfo@mncee.org or visit mnlendingcenter.org. CITY OF MOUNDS VIEW LOAN PROGRAM The current loan terms and conditions stated, including interest rates, do not constitute a commitment to lend or offer to enter into an agreement, and such an offer may only be made pursuant to Minnesota Statues, Section 47.206(3) and (4). *APR is based on $15,000 for 10 years. Closing costs apply. The City of Mounds View is supporting Home Energy Squad Enhanced by buying down the cost to $50. Home Energy Squad is provided by CenterPoint Energy and Xcel Energy and delivered by the Center for Energy and Environment (CEE), a Minneapolis non-proﬁt. ENERGY SAVINGS CUSTOMIZED FOR YOUR HOME. If your home needs insulation or air sealing our crews will provide a quote for the recommended work and connect you to a qualiﬁed contractor that will honor the quote. TO SCHEDULE YOUR VISIT: Call 651-328-6220 or visit mncee.org/hes/moundsview HOME ENERGY SQUAD ENHANCED- $50 Our team of trusted energy consultants will come to your home, evaluate your energy savings opportunities, and install the energy-efﬁcient materials of your choice: • Door weather stripping • A water heater blanket • Programmable thermostat • LED light bulbs • High-efﬁciency showerheads • Faucet aerators • Pipe Wrap Our team will also: • Perform a blower door test to measure your home for air leaks. • Complete an insulation inspection of your attic and walls using an infrared camera. • Safety check your home’s heating system and water heater. • Help with next steps. Item #: 5B Meeting Date: May 18, 2018 Type of Business: EDC City of Mounds View Staff Report To: Economic Development Commission From: Brian Beeman, Business Development Coordinator Item Title/Subject: Update from Comprehensive Plan Task Force Members Background As part of the 2018 EDC Priorities the EDC has identified the following goal: “Review Business section of the Comprehensive Plan Task Force for 2018 update by utilizing the two Comprehensive Plan Task Force Members who are also on the EDC” Discussion When reviewing the 2018 EDC Priorities it was suggested that an update from the Comprehensive Plan Task Force Members be added to the agendas going forward. Recommendation Staff recommends that the EDC hear the update from the Comprehensive Plan Task Force Members and discuss any suggestions/concerns the EDC may have relating to the business section of the Comprehensive Plan for the task force members to pass along. Respectfully submitted, ____________________________ Brian Beeman Business Development Coordinator Item #: 5C Meeting Date: May 18, 2018 Type of Business: EDC City of Mounds View Staff Report To: Economic Development Commission From: Brian Beeman, Business Development Coordinator Item Title/Subject: Update from Commissioner Muckala on New Business Categories to fill vacant space in Mounds View Background As part of the 2018 EDC Priorities the EDC has identified the following goal: “Monitor & explore new business categories through trade groups like Medical Alley and identify available spaces in Mounds View with the intent to fill those vacancies with new companies”. Discussion Commissioner Muckala is volunteering some of her time to assist in setting up meetings with industry trade groups like Medical Alley in cooperation with Business Development Coordinator Brian Beeman. Beeman and Muckala have met to discuss the process and met with Medical Alley April 4, 2018. EDC Commissioners are encouraged to provide ideas on other trade groups that staff can meet with to discuss possibilities in locating to Mounds View. If Commissioners have contacts with other trade groups and companies that may be a fit for Mounds View they are encouraged to pass along those contacts Coordinator Beeman who will start compiling a list of contacts and work towards setting up meeting with the industry trade groups. At the March 16, 2018 EDC meeting it was suggested that Minnesota High-tech also be contacted. The idea is to target young start-up companies and get to them early to identify the location, technical space, and engineering office areas that Mounds View could host and grow the businesses. Recommendation Staff recommends that the EDC hear the update from Commissioner Muckala and discuss and offer any suggestions the EDC may have relating to the business industry categories and contacts. Respectfully submitted, ____________________________ Brian Beeman Business Development Coordinator Item #: 7A Meeting Date: May 18, 2018 Type of Business: EDC City of Mounds View Staff Report To: Economic Development Commission From: Brian Beeman, Business Development Coordinator Item Title/Subject: Reports of Staff A. Crossroad Pointe Redevelopment Project On January 8, 2018 the EDA approved the predevelopment agreement between the EDA and INH Properties who is proposing to build an approximately 120-160 unit market rate apartment building. The developer will present three options in a proposal to the City Council at its June 4, 2018 Council Worksession. EDC Members are welcome to attend this meeting. INH will begin their due diligence by coordinating with their architect and testing the soils etc. soon. INH will have legal access to the Crossroad Pointe site for one year to conduct their due diligence and work towards a formal development agreement. C. Rice Creek Commons (TCAAP) Development Update There are no new updates for the Rice Creek Commons development. D. Mounds View Project Updates N/A E. North Metro Business Council Meeting The next North Metro Business Council meeting will be held June 13, 2018 from 7:30- 9:00 a.m. at the Mermaid Event Center. The topic is, “Cyber Security”. All meetings are free. F. MWF Properties MWF Properties is looking to construct around 60 units of workforce housing on two lots owned by Cynthia Johnson, located at 2865 Mounds View Boulevard and 7980 Groveland Road and also two adjacent tax forfeiture parcels. The City Council approved a Housing TIF district March 12, 2018. The City is working with Ramsey County and MWF to finalize the land acquisition. Construction is expected to begin in 2018 and completed December 2019. Reports of Staff May 18, 2018 Page 2 of 2 G. The Triton The Triton is a 61 unit affordable housing project to be located at the old Skyline Motel site. The developer has until the end of 2018 to close on the purchase agreement. The proposed project will be a four-story above underground parking facility partly funded by the 9% Tax Credit program. At its April 9 meeting, the City Council approved a resolution showing support in creating a TIF district after it has been announced that the developer has been awarded the Tax Credits. This likely will not occur until late this fall. The developer is asking the City for a Housing TIF in the amount up to $375,000 for 15 years. H. Norhart Homes Norhart Homes is proposing to build an approximately 200 unit market rate apartment building on the five parcels east of Bel-Rae. The Council reviewed this project at its April 2, 2018 worksession. The developer is working through the financial feasibility with Ehler’s, the City’s financial consultant. I. Other Upcoming Events/Reports City offices will be closed Monday May 28, 2018 in observance of Memorial Day. J. Reports of Commissioners (Agenda Item 7) K. Upcoming EDC Meetings (Agenda Item 8) The next meeting will be held June 15, 2018 at 7:30 a.m. if needed. ______________________________ Brian Beeman Business Development Coordinator