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HomeMy WebLinkAboutHRA MINUTES 02241988i C 2 TY O F S T. ANTHONY HO U S 2 N G AND RE D EVE L O PMENT AUTHOR 2 TY M = NUT E S FEBRUARY 2 4, 1 9 8 8 1 The meeting was called to order at 10:15 P.M. by Chair Sundland. 2 Present for roll call: Sundland, Vice Chair Enrooth, Secretary/ 3 Treasurer Marks, and Commissioners Makowske 4 and Ranallo. 5 Also present: David Childs, Executive Director 6 William Soth, H.R.A. Attorney 7 FEBRUARY 9. 1988 H.R.A. MINUTES 8 Motion by Marks, seconded by Ranallo to approve as presented. 9 Motion carried unanimously. 10 CLAIMS �1 Motion by Marks, seconded by Makowske to approve payment of $2,294.29 2 to the Dorsey & Whitney law firm for legal services to the H.R.A. 13 during October, 1987. 14 Motion carried unanimously. 15 STAFF UPDATE ON KENZIE REDEVELOPMENT PROJECT - CHILDS AND SOTH 16 After Staff's meeting with the H.R.A. February 9th, staff met with 17 both Gaughan and Lang/Nelson and indicated the City.wanted $20,000 now 18 and $20,000 in 30 days for an additional 15 days which would not be 19 applied to the purchase price for the land. There was no interest on 20 the part of either developer to that proposal. 21 Conversation that day with Gaughan indicated their willingness to put 22 up $20,000 for 45 days with the amount to apply to the purchase price. 23 Staff is waiting for a final response from Lang/Nelson, Monday because 24 their representative reported his boss' first reaction had been that 25 the City was in effect, "raising the purchase price by $40,000." 26 Staff's response had been to tell Lang/Nelson that the intent had not 27 been to raise the price of the land but that the H.R.A. was only 28 looking for security to assure project development and if that 29 happened, there was no reason the money couldn't be applied to the 30 purchase price. Mr. Childs added that because Lang/Nelson doesn't 1 have an exclusive on the project, they are unable to proceed at this 2 point anyway. •1 2 3 4 5 6 7 8 9 Gaughan has reported, having a Phoenix insurance company, whose representatives will be coming to St. Anthony the next day to look over the site, which had been confirmed by Piper Jaffray. The consensus was that the insurance company route was preferable to waiting the necessary period it would take for H.U.D. to approve financing. Sundland pointed to the insurance company who had come forth to put up 570 million dollars towards the development of the Bloomington Mega Mall. He perceived this might provide the needed incentive for Gaughan to put up the $40,000. 10 The presence of Diane and Robert Slick of the Alternative during the 11 recess was noted by Sundland, who said they were understandably 12 concerned about how the project was progressing. 13 Childs concluded his report by commenting that he had to believe each 14 of the developers when they said they were waiting for interest rates 15 to come down which was happening right now. Ranallo pointed to 16 Rothchilds' rates which had dropped to 9-3/4 February 23rd from 1071/2 17 which they had been for a long time. 18 Soth said staff had told the developers that the H.R.A. expected some 19 money to be put up as a measure of their confidence that the project 20 would be done. 21 Ranallo indicated he perceived "$20,000 was better than nothing" and 42 he suggested giving staff the power to negotiate that kind of a deal 3 with Gaughan for 45 days. Soth posed the possibility that a bidding 24 war might ensue between the two developers, which was generally agreed 25 might be advantageous to the project. Soth told Makowske that if the 26 insurance company indicated an interest in the project, Gaughan would 27 be told they could put up their Letter of Credit, which would be 28 returned if that method of financing failed, but they would lose the 29 $20,000. 30 It was agreed that a short H.R.A. meeting would be called if events 31 warranted it. 32 33 Motion by Marks, seconded by Enrooth to adjourn the H.R.A. meeting at 34 10:30 P.M. for a Council Executive Session, which followed 35 immediately, related to direction to staff regarding the City's 36 lawsuit against the U.S. Army et al in connection with St. Anthony's 37 water contamination problems. 09 39 Respectfully submitted, 40 Helen Crowe, Secretary W1 :cjk 2 Motion carried unanimously.