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HomeMy WebLinkAboutCC MINUTES 101420081 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 CITY OF ST. ANTHONY CITY COUNCIL REGULAR MEETING MINUTES OCTOBER 14, 2008 CALL TO ORDER. Mayor Faust called the meeting to order at 7:00 p.m. PLEDGE OF ALLEGIANCE. Mayor Faust invited the Council and audience to join him in the Pledge of Allegiance. ROLL CALL. Present: Mayor Faust; Councilmembers Gray, Roth, Stille, and Thuesen Absent: None Also Present: City Manager Mike Mornson and City Attorney Jay Lindgren CONSIDERATION, DISCUSSION, AND POSSIBLE ACTION ON ALL OF THE FOLLOWING ITEMS. I. APPROVAL OF OCTOBER 14, 2008 CITY COUNCIL MEETING AGENDA. Motion by Councilmember Thuesen, seconded by Councilmember Gray, to approve the City Council Meeting Agenda of October 14, 2008. Motion carried unanimously. II. PROCLAMATIONS AND RECOGNITIONS. None. III. CONSENT AGENDA. A. Consider September 23, 2008 Council meeting minutes. B. Consider licenses and permits. C. Consider payment of claims. D. Resolution 08 -064; Approving Election Judges for the Presidential Election on November 4, 2008. E. Resolution 08 -065; Approving the Hennepin County Recycling Grant. F. Resolution 08 -066; Changing the City Council meeting scheduled for December 23, 2008 to December 15, 2008. Motion by Councilmember Gray, seconded by Councilmember Stille, to approve the Consent Agenda items. Motion carried unanimously. City Council Regular Meeting Minutes October 14, 2008 Page 2 1 IV. LEGISLATIVE UPDATE. 2 3 (Moved in the agenda to follow Agenda Item 5A). 4 5 Congressman Keith Ellison was present to provide the legislative update. He stated his office is 6 well aware of the needs of the people of St. Anthony Village. He provided an overview of the 7 following legislation: 8 ■ $750 billion bailout package recently approved by Congress 9 • Program passed by the Senate and House in July to provide assistance to homeowners 10 experiencing difficulties with their mortgages 11 • Encouragement to the community to engage in the conversation on what the financial 12 services sector should look like 13 ■ Efforts with Congressman to get G.I.'s their full benefits 14 15 Congressman Ellison stated the following will be big legislative issues coming up: health care, 16 "No Child Left Behind ", and immigration. He stated he is committed to support ofNorthstar. He 17 cannot guarantee earmarks, but he will work hard to get earmarks that are important to St. 18 Anthony Village passed. His opinion is that this is the system they have, and he will use the 19 system to try to get projects passed that will benefit his constituents until there is another system 20 in place. 21 22 Mayor Faust thanked Congressman Ellison for the lead he has taken in administering his work 23 with Islamic countries and members of the armed forces. 24 25 Congressman Ellison stated the U.S. has a lot of allies in the Muslim world. They will be safer if 26 they can expand their allies and isolate their enemies. He thanked the City Council for being the 27 closest unit of government to the people. 28 29 V. PUBLIC /ADMINISTRATIVE HEARING. 30 31 A. Resolution 08 -067: Approving the a Property Tax Abatement for Emerald Park. Stacie 32 Kvilvang, Ehlers & Associates presenting. 33 34 Mayor Faust opened the public hearing at 7:04 p.m. 35 36 Ms. Stacie Kvilvang, Ehlers & Associates, provided an overview of Resolution No. 08 -067 and 37 the proposed property tax abatement for Emerald Park. She stated the City will be issuing these 38 bonds in early 2009, along with its annual road reconstruction bonds, in order to realize cost 39 savings by issuing the debt at the same time. To meet the City's financing parameters, the City 40 will issue the abatement bonds with a 20 -year term. The City can grant tax abatement for this 41 term if the School District or County declines to participate in the abatement, which is typical of 42 these entities for park improvement projects. The County will be considering approval of a 43 resolution declining to participate in the abatement project at their October 21" meeting. 44 45 Councilmember Stille noted that rates are coming in very high due to liquidity in the 46 marketplace. He inquired about the recommended action if rates spike higher. Ms. Kvilvang City Council Regular Meeting Minutes October 14, 2008 Page 3 replied they are still seeing stabilization in the municipal bond market. For a community that is non -rated it may be more difficult to see the sale of bonds, but Ehlers and Associates has seen bond sales every week on a daily basis. The rates they are seeing today are still very attractive at under 5 %. As they look to 2009, they will have the opportunity to test the market. If it will not be advantageous to sell at that time, they do not have to sell the bonds and may look to postpone or issue temporary bonds. 8 Councilmember Stille inquired about the feasibility of resurrecting the discussions on using an 9 internal loan. Ms. Kvilvang replied those discussions could be resurrected if the rates are not 10 satisfactory. 11 12 Mayor Faust noted there could be a determination made not to proceed with the project. At this 13 point they will move the process forward and see how the market plays out. 14 15 Mayor Faust closed the public hearing at 7:10 p.m. 16 17 Motion by Councilmember Stille, seconded by Councilmember Roth, to adopt Resolution No. 18 08 -067; Approving the Property Tax Abatement for Emerald Park. 19 20 Councilmember Stille stated he would like to reiterate that this action is not tying the City's 21 hands. They want to do this project, but they want to do it right from a physical and a financial 22 perspective. At this point in time they need to keep the ball rolling. He pointed out that in regards 23 to the abatement, the property taxes on the abated properties will not be increasing. 24 25 Motion carried unanimously. 26 27 VI. REPORTS FROM COMMISSION AND STAFF. 28 29 None. 30 31 VII. GENERAL BUSINESS OF COUNCIL. 32 33 A. Silver Village Update. Stacie Kvilvang. Ehlers & Associates. 34 35 Ms. Kvilvang presented the Sales and Availability Update on Silver Lake Village dated October 36 8, 2008. She provided background information on the request made by Lenn Pratt, Housing 37 Developer for Silver Lake Village, to change the Phase 1B Housing Development and Council's 38 action to approve a resolution directing staff to draft a 7th amendment to the Development 39 Agreement allowing: 40 1. The change in use of the Phase 113 housing from 128 condominiums to 100 units of 41 senior cooperatives 42 2. Extend the date for which construction should commence to September 1, 2009, since the 43 developer informed them that due to market conditions, he would be unable to meet the 44 September 1, 2008 construction start date (one year extension). 45 City Council Regular Meeting Minutes October 14, 2008 Page 4 1 Ms. Kvilvang reviewed that Council provided staff direction that the amendment would not be 2 brought back to them for approval unti l the developer was certain that senior cooperatives were a 3 viable alternative and/or had attained the required 60% presales for financing purposes (HUD 4 has recently increased this to 70 %). The 7`h amendment has been drafted but has not been 5 brought before the Council for approval as the developer has not met the presale requirements 6 yet. She stated on October 2, 2008, the City sent Mr. Pratt a Notice of Default for Phase 1B of 7 Silver Lake Village. The default was due to Mr. Pratt not commencing with construction of this 8 phase by September 1, 2008 as required in the Development Agreement. Ms. Kvilvang stated in 9 light of current market conditions and the inability for the Cooperative Development to move 10 forward this fall as originally anticipated, Mr. Pratt has requested that the City request an 11 extension to the Fannie Mae loan on his behalf. She noted that a one year extension was 12 approved by Fannie Mae and the City last year, with final payment on the outstanding $2.6 13 million loan to be made by December 31, 2008. Since the development is not anticipated to 14 begin until next spring, Mr. Pratt is requesting another one year extension. Ms. Kvilvang 15 requested direction from the Council as to whether to request the one year extension on the 16 Fannie Mae loan and whether to come forward with the 7`h amendment to take the Development 17 Agreement out of the default position 18 19 Councilmember Stille requested information regarding the payment history on the Fannie Mae 20 loan. Ms. Kvilvang replied there are three principal payments required on the Fannie Mae loan: 21 $125,000 in March, $125,000 in June, and $1.8 million on September 1, 2008, with the final 22 residual to be paid by December 31, 2008. 23 24 Councilmember Stille questioned how the lower density will affect the project. Ms. Kvilvang 25 replied she does not think it has an effect on the project. The $2.6 million is paid by $1.5 million 26 in land sale proceeds so it leaves a net of $1.1 million. With the 100 units they should be able to 27 generate what is needed to pay off the $1.1 million. 28 29 City Attorney Lindgren noted that the correct maturity date on the Fannie Mae loan is December 30 12, 2008, rather than December 31, 2008. 31 32 Mr. Pratt stated it was good to hear the Congressman and Ms. Kvilvang talk about Main Street 33 and what is happening on the ground. It is difficult to sort through all of this. He pointed out that 34 there were a total of 51 transactions at Silver Lake Village in 2008. He stated each and every one 35 of these transactions has more or less had an existing home associated with it, and this has been 36 an accomplishment in itself. As he looks at the help going to Fannie Mae and Freddie Mac, and 37 the help that hopefully comes to Main Street it is important to realize it would not be out of order 38 to expect that Fannie Mae could help them here. He stated he has spent a lot of time in 39 Washington on behalf of the National Association of Homeowners, and to have these agencies 40 serve the purpose of community redevelopment was the purpose of the funding. Mr. Pratt stated 41 he has been making the interest payments on the Fannie Mae loan. They stand here ready to ask 42 for help to get this through the next year. Mr. Pratt reviewed the cost to buy a limited share in the 43 co -op and stated this becomes an affordable senior product for Silver Lake Village and the City. 44 He stated this plan has gone through various steps to get to this design and price. HUD has 45 reviewed it and accepted this site for their loan. It is just a matter of getting the homes presold. H 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 City Council Regular Meeting Minutes October 14, 2008 Page 5 He stated there is a lot to be proud of at Silver Lake Village and they continue in their effort to get the job accomplished. Mayor Faust thanked Mr. Pratt for the Thursday night concerts put on by Silver Lake Village. Councilmember Stille requested information regarding this HUD financed project in comparison to the private bank financed project that was recently reported on in the newspaper. Mr. Pratt stated there is a significant difference in these projects. The loan on this project that is insured under the authority of HUD is a non - recourse loan to the seniors. The seniors are not left to go out and arrange for their own financing, it is underwritten by HUD. In the Gramercy situation the people were left to get a loan for a share in a building on their own; a share is a different type of vehicle for ownership and it has been hard to have that underwritten. Mr. Pratt stated the difference is significant in that there is no underlying overall blanket mortgage under the Gramercy method of financing a building. This HUD program, and there are now 40 of them in the Twin City area, has become the steadfast understood method because it becomes an instrument of HUD to address the senior housing needs, which is the demographic mix with this project. Mayor Faust pointed out that with the Gramercy project the presold threshold was only set at 30 %. The Silver Lake Village project has a presold requirement of 70% before construction on the building can begin. Councilmember Stille noted at that time the membership fees should be sufficient to cash flow the loan. Mr. Pratt stated the Gramercy project consisted of more expensive homes, while this project includes an affordability component. The experience he has had in the last two plus years of selling houses here is that the people here want to be able to move, possibly laterally at this time. As people grow older and look at their resources and pensions, they begin to look at life in a different way. They may be able to get those folks that want to stay in St. Anthony a place for them to come, and to be able to do so in this fashion with HUD's full underwriting. Mayor Faust noted the options before the Council are: 1) Do nothing and proceed with foreclosure; 2) Direct staff to negotiate with Fannie Mae for a one year extension. City Attorney Lindgren advised that there may be other options within the first option. Councilmember Stille stated these things happen in an environment like this. Mr. Pratt has done a remarkable job continuing to keep the project viable in terms of generating sales. He commented on possible changes Fannie Mae may attach to the loan if it is extended, such as raising the rate. Ms. Kvilvang provided information on the LIBOR and the possibility of a requirement for a payment on the principal if the Fannie Mae loan is extended. If a payment on principal is required it would be paid by the developer. Mayor Faust stated his recommendation is to direct staff to negotiate with Fannie Mae for a one year extension and to present the information to Council in November. City Council Regular Meeting Minutes October 14, 2008 Page 6 2 Ms. Kvilvang stated this is the timeline staff would work with. It should be noted that with the 3 last extension Fannie Mae was flexible in meeting the timelines. They may not hold firm to the 4 December 12, 2008 loan maturity date if there are active negotiations in process. Councilmember Stille stated this happens all the time with extending loans and transactions and it is not a reflection of the project. He verified with City Manager Morrison that Mr. Pratt is current with interest payments. 10 City Manager Morrison stated the HRA will be approving the October interest payment on the 11 Fannie Mae loan for this project at the HRA meeting tonight. 12 13 Consensus of the City Council was to direct staff to negotiate with Fannie Mae for a one year 14 extension and to present the information to the Council in November. 15 16 Mayor Faust stated he agrees with Councilmember Stille that this does not reflect on the 17 development and/or the long term goal and objective. This is a well run project that includes 18 good, affordable housing of various types that accommodate the residents. 19 20 VIII. REPORTS FROM CITY MANAGER AND COUNCIL MEMBERS. 21 22 City Manager Morrison reported on the following: 23 ■ Attending the ICMA Conference in September in Richmond, VA — Discussion on safe 24 routes to school and walkable communities 25 ■ Training opportunities: 1) PRIMA — Front Office Security; 2) LMCIT — Loss Control for 26 Liquor Stores 27 ■ Central Park Pavilion: work was completed by staff at a cost of $600 in comparison to the 28 $9,700 bid from the vendor 29 ■ Garbage Hauler Task Force — third meeting October 20, 2008 at 6:30 p.m. 30 ■ Re- Codification will be presented at the next Planning Commission — target date of 31 October 31, 2008 32 • Water Re -Use — target date of October 31, 2008 33 ■ Silver Lake Road — target date of November 25, 2008 34 ■ Emerald Park Open House — October 27, 2008 at 7:00 p.m. 35 ■ Junior Achievement in 2009 — Two 2 "d Grade Classes are scheduled 36 ■ APA Mobile Workshop — April 28, 2009 — 9 a.m. to noon 37 ■ Staff is working on the Animal Control Ordinance 38 ■ MAMA/LMC/Metro Cities — November 20, 2008 — noon to 8:00 p.m. at Hotel Sofitel in 39 Bloomington 40 41 Councilmember Stille reported on his attendance at the following events: 42 ■ October 5th monthly Sister City meeting. The community is invited to attend the annual 43 meeting scheduled for December 7th with a business meeting at 6:30 p.m. and a 44 presentation and entertainment following. 45 • October 9th event at Wilshire Park Elementary School that included a talk with third 46 graders about what it means to be a city council member. City Council Regular Meeting Minutes October 14, 2008 Page 7 1 October 91h Family Services Collaborative meeting. Dr. Steven Kahn will speak on 2 Monday, November 3`d at 7:30 p.m. at the St. Anthony Middle and High School Media 3 Center on the need to reduce the help we give to our children over time to allow them 4 opportunities to develop independence, competence and autonomy. 6 Councilmember Thuesen stated it is good to be back after his absence. He stated on August 201h 7 he went to the hospital and by Thursday, August 21" he was scheduled for brain surgery. On 8 Friday, August 22nd he had two tumors removed from his brain. He will be going through 9 chemotherapy and radiation. It will remain a difficult situation, but he is doing as well as can be 10 expected. He appreciates the cards and everything from the community. He intends to be on the 11 City Council through the end of his term to do what he was voted to do and to help the 12 community. 13 14 Councilmember Gray stated he has nothing to report. 15 16 Councilmember Roth stated he has nothing to report. 17 18 Mayor Faust reported on his attendance at the following: 19 • September 30t11 tour of the Water Reuse Plant 20 • September 30th quarterly City Council/School Board meeting including the emergency 21 operationsglan as it reflects to the pandemic flu 22 ■ October 3` League of Minnesota Cities Personnel Committee meeting 23 24 IX. COMMUNITY FORUM. 25 26 Mayor Faust invited residents to come forward at this time and address the Council on items that 27 are not on the regular agenda. 28 29 Hearing none, Mayor Faust moved forward with the agenda. 30 31 X. INFORMATION AND ANNOUNCEMENTS. 32 33 Mayor Faust announced the following: 34 ■ Village Notes was distributed this week. 35 • Fall yard waste disposal is available to all St. Anthony residents at the Ramsey County 36 compost site free of charge. 37 ■ The City Council will vote on the draft 2009 City Policies on November 20, 2008. 38 39 Councihnember Thuesen commended Mayor Faust for the Letter to the Community included in 40 the City Newsletter and the work of staff on the Newsletter. 41 42 XI. ADJOURNMENT 43 44 Mayor Faust adjourned the meeting at 8:18 p.m. 45 46 Motion carried unanimously. City Council Regular Meeting Minutes October 14, 2008 Page 8 2 Respectfully submitted, 4 Carol Hamer Timesaver Off Site Secretarial, Inc. 8 9 ATTEST: 10 City Clerk 11 12 ayor