11-18-02 Regular
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HOUSING AND REDEVELOPMENT
AUTHORITY MEETING MINUTES
Richfield, Minnesota
Regular Meeting
November 18,2002
The meeting was called to order by Chair Harms at 7:00 p.m.
HRA Members
Present:
Thomas Harms; Kristal Stokes; Michael Sandahl; and Dan Linnihan.
HRA Members
Not Present:
Joan Heimberger.
Staff Present:
Samantha Orduno, Executive Director; Steven Devich, Acting City Clerk;
John Stark, Community Development Manager; and Bruce Nordquist,
Housing and Redevelopment Manager.
Item #1
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Acting City Clerk Devich administered the oath of office to Commissioner Tom Harms.
Item #2
Chair Harms announced the recess of the Regular Housing and Redevelopment Authority
meeting to a HRA Closed Executive Session to discuss terms of settlement of relocation benefits
HRA Meeting Minutes
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November 18, 2002
related to Walser Buick/lsuzu and Motorwerks BMW formerly at and adjacent to 2100 West 78th
Street.
Chair Harms adjourned the meeting at 7:03 p.m. to the Closed Executive Session in the
Executive Conference Room.
The Housing and Redevelopment Closed Executive Session was called to order by Chair
Harms in the Executive Conference Room at 7:05 p.m.
Members Present:
Thomas Harms; Kristal Stokes; Dan Linnihan; and Michael Sandahl.
Members
Not Present:
Joan Heimberger.
Staff Present:
Samantha Orduno, Executive Director; Steven Devich, Acting City Clerk;
John Stark, Community Development Manager; and Bob Vose, Attorney
with Kennedy & Graven.
The purpose of this meeting was for discussion of terms of settlement of relocation benefits related
to Walser Buick/lsuzu and Motorwerks BMW formerly at and adjacent to 2100 West 78th Street.
The Closed Executive Session was convened pursuant to M.S. 471.705.
The Closed Executive Session adjourned at 7:22 p.m.
Item #3
Chair Harms reconvened the Regular HRA meeting in the City Hall Council Chambers at
7:25 p.m.
MIStokes, S/Sandahl to approve the minutes of (1) Reqular HRA Meetinq of October 21,
2002 and (2) Special Concurrent of HRA, City Council and Planninq Commission Meetinq of
October 30, 2002.
Motion carried 4-0.
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HRA Meeting Minutes
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November 18, 2002
Item #4
The agenda was approved by unanimous consent.
Item #5
A. Approved Apartment Remodeling Program expenditure at 7545 Penn S.R. No. 47
M/Sandahl, S/Stokes to approve the consent calendar.
Motion carried 4-0.
Item #6
Executive Director Orduno reviewed Staff Report No. 48 regarding consideration of a
resolution approving Modifications to Redevelopment Plan for Richfield Redevelopment Project
Area; a resolution modifying Tax Increment Financing Plan for Interchange West and Lyndale
Gateway Tax Increment Financing District within Richfield Redevelopment Project Area; and a
resolution establishing Lyndale Gateway West Tax Increment Financing District within Richfield
Redevelopment Project Area and adopting a Tax Increment Financing Plan.
Executive Director Orduno asked Community Development Manager Stark to present the
background information concerning these items to the HRA.
Community Development Manager Stark presented an historical background of this area
and previous redevelopment proposals. Mr. Stark summarized the process used to select the
Cornerstone group and their proposal. He stated that ultimately this project would not be feasible
without the use of Tax Increment Financing (TIF). Mr. Stark stated that because of the need for
TIF assistance on this project, there are three related actions before the HRA for consideration at
this time. He then described in detail, each of the three items, including the application of the "But
For" test.
Mr. Stark stated that the consulting firm of Short, Elliot, Hendrickson (S.E.H.) conducted two
separate studies of the area. The first study was entitled "Blight Assessment" and describes the
conditions of blight in the area. The second study, entitled the "Redevelopment Eligibility
Assessment", provides a technical analysis of the requirements for establishing a TIF district. The
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November 18, 2002
findings of the S.E.H. studies were presented to the HRA including the conclusions that: a) the
area is blighted, and; b) that the area meets the technical requirements required for the
establishment of a TIF district.
Dan Cornejo of S.E.H., who conducted the Blight Assessment study, presented a detailed
overview of the findings of that study. He reported that among the findings of the study are that
Minnesota statutes list ten criteria to define blight and that the study indicates that "moderate" or
"strong" evidence of at least one blighting criteria were found on all but two of the 21 properties in
the area (those two properties are public rights-of-way). The finding found that the majority of the
properties are affected by three to six of the blighting conditions listed in State Statute. The study
identifies the location at which each of these criteria was found and, in most cases, provides
photographs as visual evidence. Mr. Cornejo stated that the ultimate conclusion of the study is
that the area is blighted.
Jason Zemke, also of S.E.H., presented the findings of the study entitled "Redevelopment
Eligibility Assessment." Mr. Zemke described the standards which must be made in order to
establish a TIF district. First, an area must be at least 70% covered by buildings or other
improvements; the study concluded that 100% of the area is covered by buildings or other
improvements; thus meeting the first requirement. Secondly, the majority of structures (more than
50%) must be deemed as "structurally substandard" in order for the area to qualify as a TIF district.
To meet the definition of structurally substandard, a property must meet both the "conditions test"
and the "code test". In the conditions test, a structure must meet a definitional requirement of
structurally substandard. In the code test, the cost of bringing a structure up to current codes must
cost more that 15% of the replacement cost of that structure in order to qualify as structurally
substandard. Mr. Zemke described his efforts to gain interior inspection of the structures (which
was possible in 15 of the 18 structures). He then decribed the process by which he applied the two
tests for structurally substandard. And, finally, Mr. Zemke presented the conclusion that 61.9% of
the structures met both tests and are, therefore, considered under Minnesota TIF statutes
considered to be structurally substandard.
M/Linnihan, S/Sandahl that the followinq 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. 869
RESOLUTION APPROVING MODIFICATIONS TO THE REDEVELOPMENT PLAN
FOR THE RICHFIELD REDEVELOPMENT PROJECT AREA
Motion carried 4-0. This HRA Resolution appears as HRA Resolution No. 869 in HRA
Resolution Book NO.7.
M/Sandahl, S/Stokes to close the public hearinq.
Motion carried 4-0.
M/Sandahl, S/Stokes that the followinq 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. 870
RESOLUTION MODIFYING THE TAX INCREMENT PLAN FOR THE INTERCHANGE WEST AND
L YNDALE GATEWAY TAX INCREMENT FINANCING DISTRICT
(A REDEVELOPMENT DISTRICT) WITHIN THE
RICHFIELD REDEVELOPMENT PROJECT AREA
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HRA Meeting Minutes
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November 18, 2002
Motion carried 4-0. This HRA Resolution appears as HRA Resolution No. 870 in HRA
Resolution Book NO.7. r'
Sid Inman, Ehlers and Associates, Inc., described his "but for" analysis for this.
M/Sandahl, S/Linnihan that the followinq 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. 871
RESOLUTION ESTABLISHING THE L YNDALE GATEWAY WEST TAX INCREMENT
FINANCING DISTRICT (A REDEVELOPMENT DISTRICT) WITHIN THE
RICHFIELD REDEVELOPMENT PROJECT AREA AND ADOPTING A
TAX INCREMENT FINANCING PLAN THEREFORE
Motion carried 4-0. This HRA Resolution appears as HRA Resolution No. 871 in HRA
Resolution Book NO.7.
Chair Harms congratulated staff on the City's recent bond rating from Moody's in New York.
Item #7
Executive Director Orduno reviewed Staff Report No. 49 regarding a resolution scheduling
a public hearing on use of eminent domain proceedings to acquire property for redevelopment
pursuant to the Lyndale Gateway West project.
Commissioner Sandahl stated that he recalls looking at potential redevelopment for nearly
20 years. He stated that as resident of this area for over 50 years, he is appreciative of this
opportunity to finally redevelop the area.
M/Sandahl, S/Stokes that the followinq HRA resolution be adopted, that it be spread in the
HRA resolution book and that it be made part of these minutes:
RESOLUTION NO. 872
RESOLUTION OF THE HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD, MINNESOTA
SCHEDULING A PUBLIC HEARING ON USE OF EMINENT DOMAIN
PROCEEDINGS TO ACQUIRE PROPERTY FOR REDEVELOPMENT
PURSUANT TO THE L YNDALE GATEWAY WEST PROJECT
Motion carried 4-0. This HRA Resolution appears as HRA Resolution No. 872 in HRA
Resolution Book NO.7.
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November 18, 2002
Item #8
Housing and Redevelopment Manager Nordquist reviewed Staff Report No. 50 regarding a
resolution approving a concept plan for the Gramercy Corporation for City Bella.
Lou Stocco, Gramercy Corporation, described a new drawing that depicts the City Bella
plaza area.
M/Sandahl, S/Stokes that the followinq 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. 873
RESOLUTION APPROVING THE CONCEPT PLAN
FOR GRAMERCY CORPORATION
FOR CITY BELLA
Motion carried 4-0. This HRA Resolution appears as HRA Resolution No. 873 in HRA
Resolution Book NO.7.
Item #9
Executive Director Orduno reviewed Staff Report No. 51 regarding a resolution to schedule
a public hearing on use of eminent domain proceedings to acquire property for redevelopment
pursuant to the City Bella project.
M/Sandahl, S/Stokes that the followinq HRA resolution be adopted. that it be spread in the
HRA resolution book and that it be made part of these minutes:
RESOLUTION NO. 874
RESOLUTION OF THE HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF RICHFIELD, MINNESOTA
SCHEDULING A PUBLIC HEARING ON USE OF EMINENT DOMAIN
PROCEEDINGS TO ACQUIRE PROPERTY FOR REDEVELOPMENT
PURSUANT TO THE CITY BELLA PROJECT
Motion carried 4-0. This HRA Resolution appears as HRA Resolution No. 874 in HRA
Resolution Book NO.7.
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HRA Meeting Minutes
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November 18, 2002
Item #10
Housing and Redevelopment Manager Nordquist reviewed Staff Report No. 52 regarding
consideration of a Purchase and Private Redevelopment Agreement with Penn Place Townhouses
LLC for redevelopment of residential sites at 6833 and 6855 Penn Avenue.
Developer David Gepner presented a drawing of the proposed project.
Chair Harms asked what the price point would be and what type of market research was
used.
Mr. Gepner responded $250,000 and $300,000 and that they would be using market data
previously used by other developers.
Chair Harms asked staff to carefully watch this project for potential future redevelopment of
this type along Penn Avenue. .
M/Sandahl, S/Linnihan to authorize the Chairperson and Executive Director to execute a
Purchase and Private Redevelopment Aqreement with Penn Place Townhouses LLC for the
redevelopment of the residential sites at 6833 and 6855 Penn Avenue South.
Motion carried 4-0.
Item #11
No report.
Item #12
M/Stokes, S/Sandahl that the followinq claims and pavroll be approved:
FIRSTAR BANK
Section 8 Checks: 103928 - 104033
HRA Checks: 26364 - 26395
$167,826.54
$40,801.88
Motion carried 4-0.
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November 18, 2002
The meeting was adjourned by unanimous consenl~1 p.m. .
l~/t& I' / /
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Tom Harms
C
Steven L. DevicH
Acting City Clerk
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