03-20-00 Regular
HOUSING AND REDEVELOPMENT
AUTHORITY MEETING MINUTES
Richfield, Minnesota
Regular Meeting
March 20, 2000
CALL TO ORDER
The meeting was called to order by Chair Harms at 7:00 p.m.
ROLL CALL
HRA Members
Present:Thomas Harms; Joan Helmberger; Kristal Stokes; Dan Linnihan; and
Michael Sandahl.
Staff Present:Samantha Orduno, Executive Director; Steven Devich, Acting City
Clerk; Bruce Palmborg, Community Development Director; and John
Dean, HRA Attorney.
APPROVAL OF MINUTES
M/Sandahl, S/Helmberger to approve the minutes of the Regular HRA Meeting of
February 22, 2000 and Special HRA Meeting of March 6, 2000.
Motion carried 5-0.
Item #1OPPORTUNITY FOR CITIZENS TO ADDRESS THE HRA.
None.
HRA Meeting Minutes-2-March 20, 2000
HRA APPROVAL OF AGENDA
Item #2
Chair Harms stated that the agenda be amended by adding Item 5, consideration of
resolution authorizing condemnation of property located at 7601 Garfield Avenue. The
agenda was approved as amended by unanimous consent.
Item #3CONSIDERATION OF RESOLUTION RECOGNIZING WITHDRAWAL OF
CSM INVESTORS, INC. AS DEVELOPER WITHIN INTERCHANGE WEST
REDEVELOPMENT AREA. S. R. NO. 23
Community Development Director Palmborg reviewed HRA Letter No. 23 regarding
consideration of a resolution recognizing the withdrawal of CSM Investors, Inc. as
developer within Interchange West Redevelopment area.
M/Sandahl, S/Stokes that the following HRA resolution be adopted, that it be spread
in the HRA resolution book and that it be made part of these minutes:
HRA RESOLUTION NO.757
RESOLUTION RECOGNIZING WITHDRAWAL
OF CSM INVESTORS, INC. AS DEVELOPER
WITHIN THE INTERCHANGE WEST REDEVELOPMENT
Motion carried 5-0. This HRA Resolution appears as HRA Resolution No. 757 in
HRA Resolution Book No. 6.
Item #4CONSIDERATION OF RESOLUTION APPROVING TERMS OF CONTRACT
FOR PRIVATE REDEVELOPMENT BETWEEN BEST BUY CO., INC. AND
RICHFIELD HRA FOR REDEVELOPMENT OF INTERCHANGE WEST
AREA. S. R. NO. 24
Executive Director Orduno reviewed HRA Letter No. 24 regarding consideration of a
resolution approving terms of a contract for private redevelopment between Best Buy Co.,
Inc. and HRA for redevelopment of Interchange West area.
George Lopuch, Senior Vice President, Best Buy, Co. Inc., addressed the HRA and
stated that they are looking forward to being a part of this project.
Tim Murnane, Vice President of Real Estate Development, Opus Northwest, L.L.C.,
reviewed two concept site plans. The project, which is to be approximately 1.5 million
HRA Meeting Minutes-3-March 20, 2000
square feet, is estimated to start construction in January/February 2001 with occupancy in
the summer of 2002.
David Menke, Director of Real Estate Development, Opus Northwest, L.L.C.,
addressed the HRA concerning the neighborhood meetings that will take place to provide
a forum for the developer to exchange information with the residents. He stated that the
developer is projecting meetings with individual property owners to establish a fair and
equitable price for their respective properties by July 2000.
John Dean, Attorney for the HRA, reviewed the proposed development agreement
between the HRA and Best Buy. Mr. Dean highlighted the primary obligations of both
parties as follows:
Best Buy Obligations:
x
Primary responsibility for acquisition of the site and site preparation
pay up front for site acquisition
-
$44.5 million budget
-
x
Primary responsibility for project permits and related costs
x
Responsible to finance and build a 1.5 million square foot office project
x
Responsibility of paying taxes and other financial responsibilities outlined in
the agreement
HRA Obligations:
x
HRA authority is to assist in the acquisition of properties
x
Construct offsite project responsibilities
Penn Avenue bridge
-
Other off-site streets and public utilities
-
x
Provide economic assistance in the form of TIF
Best Buy Responsibilities at closing:
x
Provide $148 million of taxable market value in the Tax Assessment
Agreement
x
If tax increment isn’t sufficient to cover debt service payments – Best Buy
must fund the difference
HRA Responsibilities at closing:
x
Provide $22.8 million – proceeds from bonds
x
Provide $13.1 million – Tax Increment Note
x
Provide $7,100,000 – bonds for Penn Avenue bridge
Mr. Dean stated that of the total tax increment assistance, 80% is for developer and
development related costs and 20% of increment is for the Administrative and Housing
Trust Fund. He also stated that this district would be a contributor to fiscal disparities.
Finally, Mr. Dean alerted the HRA to a change in the agreement. Section 3.7 on
page 13 refers to possible TEA-21 funding. Mr. Dean stated that funding for this cycle has
been determined and Richfield did not get funds. Therefore, Section 3.7 is amended by
adding: “or any other state or federal funding”.
HRA Meeting Minutes-4-March 20, 2000
Mr. Dean commented on the other decision steps that may provide additional
consideration by public bodies and/or public hearings.
x
Comprehensive Plan amendments
x
Subdivision and land use issues
x
Public Business Subsidy Act related hearings
x
Developer presentation of detailed plans to HRA and Planning Commission
Sid Inman, Ehlers & Associates, addressed the HRA regarding the financial aspects
of the agreement. He stated that this project has some unique aspects:
x
Owner occupied project
x
Benefit to the developer about 60% instead of typical 90%
x
Best Buy will pay a market rate price for the lands to be acquired
Commissioner Helmberger asked about the TEA-21 funds and if they might be
awarded to the City in future years.
Mr. Dean responded that it could happen, but may not be timely with respect to this
project.
Chair Harms asked how many individuals will be available to address property
purchases.
Mr. Murnane responded that three contacts at Opus will be available. In addition
Mr. Brooks who formerly worked with CSM on the acquisition will also be available. Opus
is aware of the previous CSM process issues and will be using a mediator to assist in the
project.
Chair Harms stated that he felt that this project was a good one and emphasized
the importance of working with the neighbors.
Commissioner Linnihan stated his concern for the residents in this process.
M/Sandahl, S/Stokes that the following HRA resolution be adopted, that it be spread
in the HRA resolution book and that it be made part of these minutes:
HRA RESOLUTION NO. 758
RESOLUTION APPROVING CONTRACT FOR PRIVATE REDEVELOPMENT
AMONG THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND
FOR THE CITY OF RICHFIELD AND BEST BUY CO., INC.
Motion carried 5-0. This HRA Resolution appears as HRA Resolution No. 758 in
HRA Resolution Book No. 6.
HRA Meeting Minutes-5-March 20, 2000
Item #5CONSIDERATION OF RESOLUTION AUTHORIZING CONDEMNATION OF
PROPERTY LOCATED AT 7601 GARFIELD AVENUE, WITHIN LYNDALE
GATEWAY REDEVELOPMENT AREA. S. R. NO. 25
Community Development Director Palmborg reviewed HRA Staff Report No. 25
regarding consideration of a resolution authorizing condemnation of property at 7601
Garfield Avenue, within Lyndale Gateway Redevelopment area.
Mr. Palmborg explained that this was a friendly condemnation to correct a technical
issue.
M/Sandahl, S/Helmberger that the following HRA resolution be adopted, that it be
spread in the HRA resolution book and that it be made part of these minutes:
HRA RESOLUTION NO. 759
RESOLUTION AUTHORIZING EMINENT DOMAIN PROCEEDINGS TO ACQUIRE
CERTAIN REAL PROPERTY IN THE
LYNDALE GATEWAY REDEVELOPMENT AREA
Motion carried 5-0. This HRA Resolution appears as HRA Resolution No. 759 in
HRA Resolution Book No. 6.
Item #6 EXECUTIVE DIRECTOR REPORT
Executive Director Orduno stated that a special issue of Your City is being prepared
that will address the issue of Tax Increment Financing. It will be mailed to residents later
this week.
Commissioner Linnihan stated a need for a written piece describing the overall
philosophy of the HRA’s housing strategy. He asked that this topic also be considered for
a similar future Your City issue.
Item #7CLAIMS AND PAYROLL
M/Stokes, S/Helmberger that the following claims and payrolls be approved:
FIRSTAR BANK
Section 8 Checks: 100122 - 100240$126,311.18
HRA Checks: 24187 – 24204; 24320 – 24380$341,370.07
HRA Meeting Minutes-6-March 20, 2000
Motion carried 5-0.
ADJOURNMENT
The meeting was adjourned by unanimous consent at 7:40 p.m.
Date Approved:
Thomas E. Harms
Chair
Steven L. DevichSamantha Orduno
Acting City ClerkExecutive Director