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HomeMy WebLinkAbout01-09-2006PROCEEDINGS OF THE MOUNDS VIEW EDA CITY OF MOUNDS VIEW RAMSEY COUNTY, MINNESOTA Regular Meeting January 9, 2006 New Brighton City Hall 803 Old Highway 8, New Brighton, MN 55112 6:35 P.M. 1. CALL MEETING TO ORDER 2. ROLL CALL: President Marty, Vice-President Stigney, Commissioner Gunn and Commissioner Flaherty. NOT PRESENT: Commissioner Thomas. 3. APPROVAL OF AGENDA MOTION/SECOND: Flaherty/Gunn. To Approve the January 9, 2006 Agenda as presented. Ayes – 4 Nays – 0 Motion carried. 4. PUBLIC INPUT None. 5. APPROVAL OF MINUTES MOTION/SECOND: Gunn/Marty. To Approve the December 12, 2005 Minutes as corrected. Ayes – 4 Nays – 0 Motion carried. 6. CONSENT AGENDA A. Resolution 06-EDA-213 Re-appointing Dr. Greg Belting and Jackie Entsminger to the Economic Development Commission MOTION/SECOND: Gunn/Stigney. To Approve the Consent Agenda, as presented. Ayes – 4 Nays – 0 Motion carried. President Marty thanked Dr. Belting and Ms. Entsminger for reapplying and their continued work on behalf of Mounds View. Mounds View EDA January 9, 2006 Regular Meeting Page 2 7. EDA BUSINESS None. 8. REPORTS A. Report regarding Phase Two Acceleration of the Medtronic CRM Campus; and Discussion of the Medtronic Development Proposal and Terms of the Amended Contract for Private Development Economic Development Coordinator Backman reviewed that the sale of The Bridges was completed on October of 2005 and on November 14, 2005 the Council approved the Medtronic Cardiac Rhythm Management (CRM) Campus final plat, the rezoning to Office PUD, and called for the redemption of all outstanding golf course revenue bonds. During November, Medtronic notified staff that they were interested in discussing the potential to accelerate Phase 2 construction of the CRM headquarters. On November 28, 2005 the Council directed staff to proceed with discussions with Medtronic regarding the potential acceleration for Phase 2 construction of the campus. On December 12, 2005 the Council approved setting a public hearing for February 13, 2006 to discuss modifications of the TIF plan and the business subsidy necessary for acceleration of Phase 2 to be concurrent with Phase 1. Economic Development Coordinator Backman advised that through various discussions and meetings, the terms of an amended contract are being developed for the EDA’s consideration. By combining Phases 1 and 2, the initial phase of the project would be significantly increased. The number of employees would be increased from approximately 3,000 to over 4,300. The building complex would be increased from 820,000 square feet to 1.2 million square feet for an increase of about 46%, and the minimum assessment agreement would increase accordingly. It is projected that 60% of the construction will be completed a year from today and 100% in two years. Economic Development Coordinator Backman reported that Medtronic has requested 95% of the available tax increment, the same percentage as in the current agreement. Medtronic would continue to finance their development costs up front and would receive tax increment on a pay- as-you-go basis at the same interest rate. Under the amended contract, fiscal disparities would be paid inside the district, or B election. He advised that Ehlers & Associates, the City’s TIF financial advisors, are carefully reviewing all qualified costs in a manner consistent with the original agreement. Also, the length of the TIF district would remain the same at 25 years. The largest single difference with a combined project would be the amount of costs allocated to structured parking in Mounds View. Economic Development Coordinator Backman explained that in return for TIF assistance, Mounds View EDA January 9, 2006 Regular Meeting Page 3 Medtronic would reimburse the City for administrative costs associated with the amended agreements. Medtronic would be responsible to construct water and sewer utilities to the site that was previously the City’s responsibility. Medtronic would pay 100% of the cost to relocate all four billboards, including the previously agreed City’s portion. If the buyout alternative has to be undertaken for the billboards, Medtronic would pay all costs associated with the four signs. Medtronic would consider financially participating in providing additional infrastructure for the City. Economic Development Coordinator Backman stated that examples include construction of a portion of a sound wall along Highway 10 by the Laport Meadows residential area, replacement of Well #4, or utility costs that exceed the $400,000 estimate. If trail costs on the former Sysco property are deemed excessive by the City, Mounds View would not be required to construct the trail and the designated funds would remain for other park uses. If Medtronic wants the trail constructed, Medtronic would pay for the trail costs in excess of $150,000 allocated from the park dedication fee. The City would pay the $150,000 and Medtronic would pay the sum above that. Economic Development Coordinator Backman emphasized that these items are not final accepted terms from either Medtronic or the City. They represent the best information that staff has at the present time. Staff is looking for guidance regarding the Phase 2 acceleration of the Medtronic CRM Campus. He advised that Ehlers is preparing additional financial analysis that will be presented at future EDA meetings. If the proposed terms meet the expectations of the EDA, and are approved by Medtronic, the next step would be to incorporate the new terms into an amended development agreement. Commissioner Flaherty asked if Medtronic would be willing to help with the City in starting the street projects. Economic Development Coordinator Backman stated the negotiating team of Ehlers and Medtronic representatives are reviewing issues and the EDA can certainly make suggestions as to what they feel are important items that should be looked at. He stated it is his sense that if the item is considered, there should be some connection with the Medtronic campus project. The tie-in with Well #4 is that the City needs to assure an adequate water supply. The City has that in Phase 1 but adding a larger project by accelerating Phase 2 moves up the timetable for consideration of Well #4. That is the suggestion of Public Works Director Lee because it is something the City needs to consider. Economic Development Coordinator Backman explained that with the sound wall, the tie-in to Medtronic is consideration of the additional traffic to Highway 10 and County Road J. City Administrator Ulrich stated that can be considered for negotiation but there is a limited number of dollars. The City is currently in a negotiation phase with Medtronic and staff would like EDA direction on the most important points to consider. City Administrator Ulrich explained that Medtronic did not feel the noise wall had enough community benefit so maybe they would consider putting money into the road fund, as they are doing with Well #4. Mounds View EDA January 9, 2006 Regular Meeting Page 4 Commissioner Flaherty stated he wanted to raise the issue of streets since another tie-in is the quality of life for future Medtronic employees and residents. He stated he is not implying that would be a number one or two priority, but he believes it should be discussed. President Marty expressed his support for money for the streets since the Medtronic campus will result in an increase in traffic. He stated he was somewhat encouraged when he learned of the negotiations and thanked Public Works Director Lee for raising the issue of Well #4. He noted that if the City had to construct a well, it would cost millions of dollars and this will assure an adequate water supply. President Marty reviewed that several years ago, during a drought when everyone was watering their lawns, Wells #1, #2, and #3 were pumping almost non-stop during the day and had to refill the water tower during the night. He explained that putting Well #4 on line was previously a concern to him due to an issue of contaminants. Several years ago, the Council had considered blending that well with other water but rather than providing “adequate” water, he would like to provide “good” water to Mounds View residents. He noted that the Medtronic water requirements will be greater so he considers it a “carrot” if Medtronic is willing to come on board with that. Vice President Stigney asked if there will be park dedication fees with Phase 2. Economic Development Coordinator Backman stated there will not be since Phase 2 is not associated with a land sale or transfer. Vice President Stigney asked about the cap. Shelly Eldridge, Ehlers & Associates, advised there is a total of $22.9 million of present value at 5%. She stated some of the costs could be funded outside of TIF if Medtronic is willing to do so. Ms. Eldridge stated they are waiting for the feasibility study to get a better number to work with. City Administrator Ulrich advised that a feasibility study is also being conducted on the underground utilities. Economic Development Coordinator Backman recapped that the EDA considers Well #4 to be a higher priority than the sound wall. He asked which road projects the EDA has in mind. Commissioner Flaherty stated he wanted road projects raised as a discussion item and he would be suggesting a contribution to the general street fund. Commissioner Gunn stated she supports consideration of roads in the northern area of Mounds View because Medtronic traffic will be coming on Highway 10 and using Red Oak Drive or Long Lake Road and County Road J. Mounds View EDA January 9, 2006 Regular Meeting Page 5 Economic Development Coordinator Backman asked the EDA if the street fund is a higher priority than Well #4. President Marty and Commissioner Gunn felt that Well #4 was the higher priority. Consensus was reached on the following list of priorities: 1. Well #4 2. Street Fund 3. Sound Wall 4. Other Infrastructure President Marty pointed out that if street projects are started, the sound wall can be started with spoils from the street projects. He stated he has also heard that Mn/DOT may be adding another lane to Highway 10 but, in the meantime, the City could start working towards a City berm. Vice President Stigney stated if employees are added to Medtronic, it will increase traffic and suggested the option of an additional ramp be discussed with Medtronic. Economic Development Coordinator Backman explained that the traffic study did address the County Road J and airport area with regard to turn lanes. He explained that cars coming off Highway 10, use the turn lane onto County Road J. The study indicated that is a higher impact than traffic coming from Long Lake Road and turning onto County Road J. Vice President Stigney stated that may be the model for the traffic study but he would like that issue raised with Medtronic. Economic Development Coordinator Backman advised that the cost estimates for the water and sewer extension will be received shortly and can be addressed at the January 23, 2006 EDA meeting. He asked about the priority of the trail or other terms. Vice President Stigney questioned a statement in the staff report indicating: “If Medtronic wants the trail constructed, Medtronic would pay for the trail costs in excess of $150,000 allocated from the Park Dedication Fee. The City would pay the $150,000 and Medtronic would pay the sum above that.” He asked if Medtronic would just pull the funds from the park dedication fee that they have contributed. Economic Development Coordinator Backman stated that is correct and if the cost is in excess of $150,000, Medtronic would pay the difference. 9. NEXT EDA MEETING: Monday, January 23, 2006 at 6:30 p.m. 10. ADJOURNMENT Mounds View EDA January 9, 2006 Regular Meeting Page 6 President Marty adjourned the meeting at 6:57 p.m. Respectfully submitted, Recorded and transcribed by: Carla Wirth TimeSaver Off Site Secretarial, Inc.