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07-20-81 agendaCITY OF RICHFIELD, MINNESOTA Office of City Manager Council Letter No. 247 Agenda July 20, 1981 The Honorable Mayor and Members of the City Council City of Richfield Council Members: Subject: Extension of Loan to HRA,; L /H /N Redevelopment Project During 1976, 1977 and 1978, the Housing and Redevelopment Authority purchased several properties on Graham Avenue which included the property located at 6600 Graham Avenue. These purchases were made upon request of the property owners. The source of funding for these acquisitions was a loan from the city's permanent improvement revolving fund (PIR). The PIR loan was to be paid back to the city in three years. However, redevelopment of this area did not progress as previously contemplated and the L /H /N plan was modified in 1979. The HRA anticipates redevelopment of the area this fall. Because the loan expires this month, it would be appropriate to extend it as requested by the HRA. It is recommended that the city council authorize extension of the $50,000 loan for 6600 Graham Avenue at a 9% interest rate for one year by adopting the attached resolution. Respectfully submitted, U Karl Nollenberger City Manager KN /sh RESOLUTION NO. RESOLUTION AUTHORIZING THE EXTENSION OF-AN ArRFEMENT TO LOAN MONEY TO THE RICHFIELD HOUSING AND REDEVELOPMENT AUTHORITY AND PROVIDING FOR THE PERFORMANCE THEREOF BY ADVANCEMENT FROM THE PERMANENT IMPROVEMENT REVOLVING FUND WHEREAS, the HRA desires to continue to borrow money for the purpose of funding certain real property purchases pursuant to and in furtherance of the L /H /N Redevelopment Project heretofore adopted by the City and HRA, said real property being described as follows: Lot 11, Block 3, Fairwood Shores, Hennepin County, Minnesota (6600 Graham Avenue). WHEREAS, the HRA is authorized by Minnesota Statutes, Section 462.445, to purchase real property and to borrow money from the City therefore, and WHEREAS, the City is authorized by Minnesota Statutes, Section 462.581, to make loans to the HRA in aid of projects, and WHEREAS, the HRA will pay a 9% interest rate on the $50,000.00 loan effective July 1, 1981, for a one year term. NOW, THEREFORE, BE IT RESOLVED BY THE CITY OF RICHFIELD: 1. That the Mayor and City Manager be, and hereby are, authorized to execute, as agents to the City of Richfield, an agreement with the Richfield Housing and Redevelopment Authority entitled "Loan Extension Agreement," a copy of which is hereby given Clerk's File No. HRA and is ordered placed on file. 2. That the City Clerk be, and hereby is directed to continue to provide monies to the Richfield Housing and Redevelopment Authority in such amount and at such time as is provided in the above agreement, said monies having heen loaned from the Permanent Improvement Revolving Fund and to return to said fund all payments made by the Housing and Redevelopment Authority pursuant to said agreement. Passed by the City Council of the City of Richfield this 20th day of July, 1981. Donald J. Priebe, Mayor ATTEST: Sylvia K. Bergh, City Clerk CITY OF RICHFIELD, MINNESOTA Office of City Manager Council Letter No. 246 Agenda July 20, 1981 ° <( The Honorable Mayor 0 and Members of the City Council cN City of Richfield Council Members: Subject: Public Hearing Concerning Financing Under the Minnesota Industrial Revenue Bond Act On June 22, 1981, the city council set July 20, 1981 as the date for a public hearing on a proposal by the Richfield State Agency (RSA) to expand their facility. This hearing is a necess- ary step in the process of providing tax exempt financing for this project as requested by RSA under the Minnesota Industrial Revenue Bond Act. Expansion of the RSA facility has been contemplated since the inception of the Lyndale /Hub /Nicollet project, and the L /H /N plan documents reflect this project. Attached to this letter is a synopsis of the project and several drawings which depict the con- struction of this two -phase project. The design concept will be presented in detail at the July 20, 1981 meeting. A construction start date of spring, 1982 is anticipated. The RSA has acquired virtually all of the properties needed for the development except for one dwelling located at 6636 Grand Avenue, the Kentucky Fried Chicken (KFC) store and Bjorn Hagen's fur shop. As the interim site plan indicates, the dwelling at 6636 Grand Avenue will remain for the first phase of development. The staff has bgun to facilitate property acquisition discussions between the RSA, representatives of KFC and Mr. Hagen. At this time, it is hoped that the RSA will be able to purchase these two properties directly without the financial assistance of the HRA. However, the dollar magnitude of this project may justify financial assistance by the HRA if it is crucial to carrying through the project. Because it may be necessary for the HRA to assume a more direct role in purchase of the KFC and Hagen properties, the Planning Commission has been requested to review such property acquisitions for conformance with the comprehensive plan. The City of Richfield will realize several benefits from the project. It is estimated that the project construction cost would be $6.3 million dollars and additional related costs would increase Council Letter No. 246 -2- July 20, 1981 the project value to more than $7.0 million dollars. The maximum amount of bonds requested is $9.0 million dollars. Approximately 40 new jobs would be created by this development and the annual payroll increase is estimated at $600,000. Increased tax revenue will also result from this project. After the public hearing, it would be appropriate for the city council to consider adopting the preliminary resolution for the tax exempt financing. It would also be appropriate for the city council to refer this proposal for comment to the surrounding neighborhood, RING and CIC. Because the development should proceed within the framework of the PUD ordinance, it would also be appropri- ate to make a referral to the planning commission to consider this proposal after the aforementioned community meetings. The next planning commission meeting will be August 24,.1981, which would be the earliest they could review the project. Hopefully, in Septem- ber, the HRA and the City Council will be presented with a draft of a developer's agreement. It is recommended that the city council take the following actions: 1. Adopt the attached resolution, giving preliminary approval to tax exempt financing and authorizing the Mayor and City Manager to execute the other documents related to this preliminary approval; 2. Authorize the staff to meet with the adjoining neighbor- hood, RING, and CIC, to review the RSA development proposal; 3. Refer the proposal to the Planning Commission for their review and recommendation. Respectfully submitted, Karl Nollenberger City Manager KN /eja cc: Community Development Director Housing and Redevelopment Coordinator Housing and Redevelopment Commissioners PLANNING 111M, TRANSPORTATION ARCH'�TARCHITECTS ENGINEERING ARCHITECTURE BENNETT, RINGROSE, WOLSFELD, JARVIS, GARDNER, INC. • 2829 UNIVERSITY AVENUE SE • MINNEAPOLIS, MN 55414 • PHONE 612/379 -7878 9 July 1981 TO: Planning Director City of Richfield 6700 Portland Avenue S. Richfield, MN 55423 FROM: David J. Bennett, AIA Principal In Charge Dennis J. Sutliff, AIA Project Architect RE: Richfield State Agency Proposed P.U.D. Zoning District BRW Architects, on behalf of Richfield State Agency wishes to make application to establish a PLANNED GENERAL COMMERCIAL (PC -2) P.U.D. Development District within the City of Richfield. The property involved in this proposal is all of that bounded by Lyndale Avenue South on the west, Grand Avenue South on the east, West 66th Street on the north, and West 67th Street on the south. It would include a vacated Harriet Avenue South between 66th Street and 67th Street. The property is described as all of Block 2 and all of Block 3 except Lots 6, 7 and portions of Lot 1 in J. N. Hauser's addition. The project area also includes a parcel roughly 140 feet by 140 feet at the southeast corner of Lyndale Avenue and 67th Street, described as lots 23, 24, and 25: Block 4 of Lyndale Shores on Wood Lake. The majority of this property is currently owned by Richfield State Agency. With the aid of the City, Richfield State Agency is in the process of acquiring the remaining few parcels. Lying as it does at a major street intersection in Richfield and within the Lyndale /Hub /Nicollet Redevelopment District, the Richfield State Agency project will be a highly visible and certainly a needed addition to the area. In its ultimate form, the project will involve 138,000 square feet of leasable office and banking functions, including approximately 79,000 square feet of new construction and the 59,000 square feet of remodeled construction. The $7,800,000.00 of hard construction costs, the expansion of the existing business and the new businesses which will ultimately be housed in the project will create a new vitality in the neighborhood as well as provide an increase in real tax income for the City of Richfield and the Redevelopment District. The development proposal for the Richfield State Agency project is currently planned in two phases with construction of the first phase scheduled to begin in the spring of 1982. It will add to and remodel the existing bank building bringing its total gross area to 110,485 square feet, an increase of over 50,000 square feet. The existing medical building at the northeast corner of the site will remain as will 4 of the existing houses in the southeast portion of the site. Additional surface parking will be provided on the north and east por- MINNEAPOLIS CHEYENNE DENVER City of Richfield 9 July 1981 Page 2 tions of the site. Access to the parking is site circulation system which will virtually into the residential neighborhoods to the ea this modified "ring- road" will allow many of west side of Grand Avenue to remain, further development on the existing neighborhood. made primarily by a new interior exclude intrusion of heavy traffic 5t and south. The configuration of the mature boulevard trees on the reducing the impact of the new Within the expanded building, Phase I will provide 70,000 square feet of space to be occupied by Richfield Bank and Trust Company. Of this 70,000, 47,500 square fee will be new, earth - sheltered construction with new drive -up tellers, parking, and landscaping located on its roof. 6,400 square feet will be new at -grade construction. Both additions lie to the south of the existing building. The remainder of the 70,000 square feet of banking facilities, approximately 16,000 square feet, will be remodeled within the existing building. Phase I will also include almost 30,000 square feet of leasable office space, and 10,800 square feet of circulation and mechanical spaces. These areas will be located in remodeled areas of the existing bank building. Construction cost of Phase I is anticipated to be $6,300,000.00. Phase II construction of the Richfield State Agency project will remove the 4 remaining houses, add parking, and add three additional floors of leasable office space to the top of the two story, north half, of the existing building. Each of these floors would contain 9,205 gross square feet bringing the total area of Phases I and II to 138,100 gross square feet. Total parking after Phase I 1,000 square feet of usable stairs, elevators, toilets, also increased stacking are; congestion which now occurs periods. I will be 549 cars. This is a ratio of 4.5 cars per floor area (not including atriums, mechanical space, etc.) or 4 per 1,000 for total gross area. There is 9 for the drive -up tellers which will reduce the on the site and adjacent roadways during busy The precise schedule for Phase II construction is somewhat dependant upon the developing market for quality office space, but Richfield State Agency would like to proceed at the earliest practical date, potentially even simultaneous with Phase I. The construction cost of Phase II, in 1982 dollars is $1,500,000 bringing the total development cost of both phases to $7,800,000. Since almost 60 percent of the new cosntruction will be earth - sheltered, the visual impact will not be great. Much of its architectural image will be expressed as structured landscaping and planted courtyards. The principal exterior material will be face brick which matches the existing building and will be accented by canopies and architectural metals. Site design, paving materials, and exterior lighting will be compatible with Lyndale /Hub /Nicollet Redevelopment Guidelines. We all look forward to continuing to work with Richfield City Planning and Richfield H.R.A. in the development of this project and wish to aid in any way we can in following through with the Review and Approval Process. F rn 1 6 n 1 � s )n i 3 �g till �} 8 L�ogLE u� y y rn 7r".� 3� Dv z LL OfAWD AV8. 6lXJTH fit Cn o Li 11 rz": .6L o ---1 . ...... OfAWD AV8. 6lXJTH fit Cn o Li 11 rz": I z :1 I- R <I d J y O� `O N � m rn N' X rn� IVAN >�@TD IN BE 7- LU 1LL< Nay N I �ff a �� I 0 6 ry z N y C rn rn ~i 0 IV >00