HomeMy WebLinkAboutHRA MINUTES 091420041 CITY OF ST. ANTHONY
HOUSING AND REDEVELOPMENT AUTHORITY MEETING
46 September 14, 2004
4
CALL TO ORDER.
Chair Pro -tem Thuesen called the meeting to order at 10:16 p.m.
9 ROLL CALL.
10 Commissioners, present: Chair Pro -tem Thuesen; Commissioners Horst, Stille, and Faust.
11 Commissioners absent: None.
12 Also present: Executive Director Michael Morrison and City Attorney Jerome
13 Gilligan.
14
15
16 1. APPROVAL OF SEPTEMBER 14, 2004 H.R.A. AGENDA.
17 Motion by Commissioner Faust, seconded by Commissioner Horst, to Approve the H.R.A.
18 Agenda of September 14, 2004.
19
20 Motion carried unanimously.
21
22 H. CONSENT AGENDA.
23 A. Approve August 10, 2004, H.R.A. Minutes.
0 B. Claims.
26 Motion by Commissioner Horst, seconded by Commissioner Stille, to Approve the Consent
27 Agenda.
28
29 Motion carried unanimously.
30
31 III. PUBLIC HEARINGS.
32 None.
33
34 IV. GENERAL POLICY OF BUSINESS OF THE H.R.A.
35 A. Kenzie Terrace Redevelopment, LaNel Financing, Stacie Kvilvang, Elhers and
36 Associates, presenting.
37 Stacie Kvilvang of Ehlers and Associates reported in lune of 2004 there was a discussion with the
38 Board of the Housing and Redevelopment Authority (HRA) regarding the sale of the HRA owned
39 land located along Kenzie Terrace. She noted the City had entered into a Purchase Agreement with
40 LaNel Financial who intended to construct 38 senior apartment units and incorporate the site into their
41 existing Autumn Woods apartment community. She indicated they proposed to purchase the
42 property for $285,000 ($7,500/unit) and were going to begin construction in 2003, however, due to
43 market conditions (high vacancy rates at Autumn Woods and in the Metropolitan Area in general),
44 the City did not close on the property and construction was not commenced.
• Ms. Kvilvang stated at a June meeting, the HRA provided Staff direction to sell the land to LaNel on
46 either a Contract for Deed or outright so the land could become taxable again, and requested that if
47 this could not happen prior to July 1, 2004 (date of property conversion from tax exempt to
Housing and Redevelopment Authority Meeting Minutes
•September 14, 2004
Page 2
1
taxable) that LaNel should pay the City its share of loss of tax revenue for 2005.
2
She noted that Staff and the City Attorney prepared a new Purchase Agreement reflecting the
3
following:
4
1.
Payment of $285,000 for the land and set a closing date of not later than October 30,
5
2004.
6
2.
Payment of a non-refundable deposit of $23,500 (loss of City portion of tax
7
revenue). '
8
3.
Payment to the City of $5,000 for attorney and consultant fees.
9
4.
Begin project by July 1, 2005 and completion of the project by July 31, 2006.
10
5.
Payment of $21,600 annually for every year they do not construct the project (this is
11
the amount the City loses annually on the project).
12
6.
HRA Right of First Refusal to purchase the property what they sold it for
13
($285,000).
14
15
16
17
18
1210
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
•
41
Ms. Kvilvang indicated that after review of the purchase agreement by LaNel Financial, they agreed
to all above listed items, except for #4 and #5, adding that they state that their desire is to develop the
property for multi -family housing, but that vacancies in the City are still an issue and they are
concerned with the competition of the senior units being constructed by Dominium in the Northwest
Quadrant. She noted that due to these two factors, they do not want to have to place a timeline on
the development, nor do they think they should be financially penalized if the market is not there to
construct the units, adding that they have stated that they are motivated to develop the site when
market conditions allow so they can construct a new common area facility for the entire site within
the new building and to be able to provide a return to their equity investors who are "fronting" the
cash to purchase the land.
Ms. Kvilvang reviewed the primary issues for the HRA to consider and provided an analysis of each
issue as follows:
What do they intend to do with the land in the interim?
LaNel Financial intends to invest around $20,000 to "clean up" the existing site
by killing existing weeds, grading the site and planting sod and/or grass seed. This
way the site will look more attractive in the interim, be maintained by them and made
to look like it is a part of the Autumn Woods community.
2. Under this scenario, when would the HRA recapture
its investment?
The HRA expended at total of $444,803 from 1996 to 1999 to acquire the five (5)
parcels. Under this scenario the HRA has to assume the worst-case scenario that
the land is never developed and that they only recapture $308,500 of their original
investment (purchase price of the land by the developer). The City will receive
taxes on the undeveloped land annually (approximately $1,850), but this amount
is negligible to the repayment of the HRA's outstanding balance of $136,000.
If LaNel does develop the site, then the HRA will recapture its full investment
within six (6) years of the development being completed.
Housing and Redevelopment Authority Meeting Minutes
•September 14, 2004
Page 3
2 3. What other options does the HRA have?
3 If the HRA does not want to pursue the sale of this land to LaNel, they could
4 send out a new Request For Proposals (RFP) to see if any housing developers would
5 be interested in constructing town homes on the site. However, it should be noted
6 that the HRA declined a town home development last time since it did not recapture
7 as much in land sale proceeds or tax revenue over time.
9 Discussion:
10 Councilmember Horst noted that LaNel seem to be serious, adding that it seems to be the best
11 option for the HRA to sell at this point and allow them to build.
12
13 There was discussion with regard to tax value collection.
14
15 Councilmember Stille indicated that he pulled up appraisals in comparison, suggesting that
16 $7,000 to $9,000 seemed to be the market value. He asked Ms. Kvilvang if she could confirm
17 his finding to be accurate; she did.
.18
19 Councilmember questioned the need of $20,000 to clean up the site, suggesting that the HRA
require a line of credit to ensure that the landscaping is completed. Ms. Kvilvang assured him
that this request would be discussed with LaNel.
22
23 Councilmember Faust questioned the zoning of the property. City Manager Morrison responded
24 in noting that it was zoned single-family, however, had been re -zoned to PUD to allow multi -
25 family.
26
27 Councilmember Faust inquired as to the difference in taxes between the different zones. It was
28 noted that single-family is 1.0 verses multi -family being 1.25. He continued in noting he feels
29 that it is a good idea to "press on" and get it on the tax roll.
30
31 Councilmember Faust concluded in discussing past water issues at the location, suggesting that it
32 is looked into to ensure that the problems have been rectified.
33
34 Motion by Councilmember Faust, Seconded by Councilmember Stille to approve the purchase
35 agreement with LaNel Financing conditioned upon 1) Payment of $285,000 for the Land and Act a
36 Closing Date of Not Later than October 30, 2004, 2) Payment of a Non-refundable Deposit of
37 $23,500 (Loss of City Portion of Tax Revenue), 3) Payment to the City of $5,000 for Attorney
38 and Consultant Fees, 4) HRA Right of First Refusal to Purchase the Property What They Sold it
39 for ($285,000), 5) Proof that Past Water Issues Have Been Resolved and 6) Financial Security
40 with Regard to Landscaping.
40 Motion carried unanimously.
43
Housing and Redevelopment Authority Meeting Minutes
•September 14, 2004
Page 4
1 B. Kenzie Terrace Redevelopment Update, Stacie Kvilvang, Elhers and Associates.
2 presenting.
3 Stacie Kvilvang of Ehlers and Associates presented the Council with a Kenzie Terrace Site,
4 Northwest Quadrant Redevelopment Update in highlighting the following:
5 1. Wal-Mart
6 a. 142,000 sq/ft facility
7 b. To open by March
8
9 2. Other Commercial
10 a. 115,900 sq/ft
11 b. Tenants signed (some to open by Thanksgiving)
12 1) Applebee's
13 2) Papa Murphy's
14 3) Cold Stone Creamery
15 4) Wendy's
16 5) Old Taco Bell Site
17
18 3. City Liquor Store #2
19 a. 9,100 sq/ft
b. Closing this week
c. Opening by end of September
22 d. Open house on October 14th from 4 to 8 p.m.
23 1) Liquor Off -Sale Restriction
24 a) Restrictive covenant that will not allow any other liquor
25 store in the development
26 2) Liquor On -Sale Restriction
27 b) Restrictive covenant that prohibits the on -sale of liquor
28 unless the City is operating a full service restaurant in
29 which food is not less than 50% of all revenues
30 3) Right to Purchase
31 c) Developer has right of first refusal to buy the liquor
32 operation if City decides to no longer run the facility
33
34 4. Tires Plus relocation
35 a. Moved into new facility across the street
36 b. Tires Plus condemnation/lease lawsuit
37 1) City awarded quick take condemnation
38 2) Lawsuit regarding lease termination pending
39 a) Made deposit with the court
40 b) Commissioners completed site visit
16 c. Demolition of the property after SAV 11 inventory moved out
43 5. Rental Housing Development - Dominium
44 a. 261 Rental Units
Housing and Redevelopment Authority Meeting Minutes
•September 14, 2004
Page 5
1
1) 80 Senior units
2
2) 161 Market rate units
3
b.
20% will be affordable to persons at or below 50% of the area median
4
income
5
c.
Closing/Construction
6
1) Closing 3rd week of October
7
2) Begin construction November
8
9
6. For Sale Housing Development
10
a.
256 Stacked Flats/Condos
11
1) 4 Buildings of 64 units
12
b.
Presales
13
1) Sales center is open
14
a) Old JA Cadawallader building
15
c.
14 presales to Date
16
d.
$180,000 to $430,000
17
Construction
18
a.
Closing on financing on September 21st
19
b.
Construction to begin end of September
1) Footings/foundation on 2 building behind Wal-Mart
2) Go vertical on building adjacent to 39th Avenue
22
3) Go vertical on 2nd building once they have 33 units pre -sold in the
23
1 st building
24
25
7. Fannie Mae Loan
26
a.
Purchase of Commercial Properties
27
b.
City approved for $3,350,000
28
C.
Developer met presale requirement to have 13 units (20%) in Phase IA
29
pre -sold before City will draw down funds for acquisition
30
d.
Closed end of August
31
32
8. City Ponds
33
a.
City Ponds (behind/front of Cub and behind Mini Mall)
34
1) Conveyed to Developer for $1 each
35
2) Developer paid for City's costs to convey them
36
a) Conveying and terminating existing easements
37
b.
Pond behind Mini Mall no longer exists
38
C.
This is where Applbee's will be located
39
d.
Developer has provided and recorded new revised easements required by
40
the City
e.
Maintenance of the storm water ponds will be paid by benefiting
16
properties
43
f.
Commercial developer contracts maintenance and pays for it. Will bill
44
benefiting properties as they are developed.
Housing and Redevelopment Authority Meeting Minutes
•September 14, 2004
Page 6
1
2 9. Upcoming Approvals
3 a. Inter fund loan
4 b. Resolution approved by HRA for TIF eligible expenditures in this district
5 C. Amendment of Phase I Budget
6 1) Phase I is under budget (both private and TIF budget)
7 2) May be a request from developer to use TIF savings for increased
8 costs for 39th Avenue Reconstruction
9 a) Doesn't increase original TIF budget
10 d. Phase II Development
I 1 1) There will be a gap
12 2) Will want to utilize excess TIF from Phase I
13
14 Ms. Kvilvang concluded in thanking all members involved in the Silver Lake Development
15 planning.
16
17 Chair Pro -tem Thuesen thanked Ms. Kvilvang for her hard work.
18
19 V. STAFF REPORTS.
0 None.
22 VI. H.R.A. COMMISSIONER COMMENTS.
23 None.
24
25 VII. INFORMATION AND ANNOUNCEMENTS.
26 None.
27
28 VIII. ADJOURNMENT.
29 Chair Pro -tem adjourned the meeting at 10:55 p.m.
30
31
32 Respectfully submitted,
33 Danielle Buckmeier
34 TimeSaver Off Site Secretarial, Inc.
35
0