12-17-1990CITY OF RICHFIELD, MINNESOTA
HOUSING AND REDEVELOPMENT AUTHORITY MEETING
December 17, 1990
HRA MEMBERS PRESENT: Thomas Harms; Vern Luettinger; Joan
a Helmberger; and Ivan Ludeman.
CITY COUNCIL MEMBERS Mayor Quam; Ivan Ludeman; and Martin
PRESENT: Kirsch.
CITY COUNCIL MEMBERS
ABSENT: Michael Sandahl
STAFF PRESENT: James Prosser, City Manager; Steven
Devich, Administrative Services Director/
Acting City Clerk; Byron Wallace,
Community Development Director; and
John Dean, City Attorney.
The HRA meeting was called to order by Chairperson Harms at
7:00 p.m.
The City Council meeting was called to order by Mayor Quam
at 7:00 p.m.
The Housing and Redevelopment Authority and the City Council
met concurrently on the following items:
HRA
Item #1 TERMS OF LETTER OF INTENT, HUB WEST. HRA LETTER NO. 47
City CONSIDERATION OF RESOLUTION APPROVING MODIFICATION #6
Council TO THE LYNDALE/HUB/NICOLLET COMMERCIAL DEVELOPMENT
Item #1 IMPROVEMENT PROGRAM. COUNCIL LETTER N0. 313
Executive Director Prosser reviewed HRA Letter No. 47
regarding the terms of the Letter of Intent, Hub West.
Larry Miller of Bradley Real Estate Trust addressed the HRA
and City Council presenting a background of Bradley Real Estate
Trust and of Bradley's business interests in the Hub.
Larry Miller next reviewed a slide presentation of the Hub,
including several before and after photos of many different
establishments in the Hub.
David Shea, Bradley Real Estate Trust, presented a plan
design for redeveloping the west portion of the Hub. The design
included an expanded parking lot and Rainbow grocery store
facility. The redevelopment proposal establishes a single
identity center with an improved traffic flow.
HRA Meeting Minutes (2) December 17, 1990
Sid Inman, Publicorp Inc., reported on the financial
feasibility of the project. Mr. Inman explained the tax
increment "But for" analysis; some sort of assistance is
necessary foz the redevelopment project. The question is really
how much assistance is warranted. The level of assistance
proposed by the staff is well within the amount which could be
supported by tax increment the entire project area.
The second aspect reviewed by Publicorp was~the overall
effect of the project on the existing district. To make that
analysis, Publicorp set forth a scenario of the most conservative
financial variables. There would be a sufficient cash flow to
maintain the fiscal health of the district, even under this
worst-case scenario.
Executive Director James Prosser reviewed the issue of the
existing parking problems and how this development would address
that problem.
City Attorney John Dean reviewed the Letter of Intent of the
project with City Council and HRA Members.
Mayor Quam and HRA Chairperson Harms opened the public
hearing. It was stated that the City Council would consider a
resolution approving Modification No. 6 to the
Lyndale/HUB/Nicollet Commercial Improvement Program and the HRA
would consider the terms of the proposed Letter of Intent.
Larry Wozniczka, 6744 Wentworth Ave., asked for a more
detailed explanation of what would be eliminated and retained in
the Hub West.
Mr. Shea reviewed the proposed changes and the proposed
pedestrian flow.
Mr. Wozniczka asked if the project would pay for the total
cost of acquisition.
John Dean, City Attorney, said the costs would be provided
by the entire Hub property alone, not the entire LHN.
Mr. Wozniczka asked why, if the purchase price is $3,937,500
and the assessor's market value is $2,900,000, are we paying an
extra one million dollars?
John Dean responded that the assessor's estimated market
value is set at approximately 92.5$ of value. That brings it up
to $3,250,000, which exceeds the net cost of the purchase to the
HRA. The City also obtained an independent review appraiser who
set the value at or more than four million-dollars to purchase.
HRA Meeting Minutes (3) December 17, 1990
Mr. Wozniczka also stated that he was concerned about the
sale price to the developer for $725,000.
Mr. Dead responded that much of the City's costs are
represented by buildings that will be torn down. It is also
important to remember that a portion of this is also assistance.
Commissioner Ludeman-said that he appreciated Mr.
Wozniczka's questions. However, Mr. Ludeman felt that under this
agreement, the City and HRA are better off than under the
original purchase of the LHN. Additionally, the HRA does not
have to sell bonds and may use debt service funds instead. Mr.
Ludeman also was concerned about the dollar difference but feels
that the project has a very good financial basis.
Mr. Wozniczka asked about the $50,000 relocation cost for
Snyders. Is the lease expiring?
Mr. Dean said that the matter of the lease will be handled
by the current property owner. The City's only obligation is
relocation costs.
Mr. Wozniczka asked why the HRA and City Council were not
requiring a developer's agreement.
Mr. Dean said there was no financial obligation until after
a developer's agreement is approved. Approval of the
modification tonight does not approve expenditure of those funds.
Mr. Dean explained how the $725,000 payment might take place and
that the $725,000 will be used directly to acquire the property
for this project.
M/Ludeman, S/Quam to close the City Council public hearing.
Motion carried 3-0.
M/Ludeman, S/Luettinger to close the HRA public hearing.
Motion carried 4-0.
Chairperson Harms asked Mr. Inman if a worst case scenario
with unfavorable law changes also was considered.
Mr. Inman responded that
Chairperson Harms stated
in the Letter of Intent, page
minimum market value will not
Mr. Dean responded that
it
the
3,
be
Kr.
was considered.
3t it was his understanding that
paragraph 8 - Subordination, the
subordinated.
Harms was correct.
HRA Meeting Minutes
(4)
Chairperson Harms asked if a timeline has
conclude purchases before developer agreement
under abandonment.
December 17, 1990
been set to
and who pays fees
Mr. Dean said a timeline has been prepared and there are no
fees under the quick take process.
Chairperson Harms and Attorney Dean discussed legal aspects
regarding the subordination provision of the agreement.
Council Member Kirsch thanked Bradley and stated that he
felt that City staff worked well on arranging the funding. Mr.
Kirsch also said that a survey of residents has reflected that
residents want a large grocery store, such as a Rainbow.
M/Kirsch, S/Ludeman that the following resolution be
adopted• that it be spread in the resolution book and that it be
made part of these minutes:
RESOLUTION NO. 7702
APPROVING MODIFICATION NO. 6 IN THE LYNDALE/HUH/NICOLLET
COMMERCIAL IMPROVEMENT PROGRAM:
REQUESTING THE RICHFIELD CITY COUNCIL TO CONDUCT
A PUBLIC HEARING THEREON:
RECOMMENDING APPROVAL OF THE PLANS
Motion carried 3-0. This resolution appears as Resolution
No. 7702 in Resolution Book No. 59.
HRA M/Ludeman, S/Helmberger that the Letter of Intent be
agproved subject to the condition that not withstanding any
provision of the Letter of Intent, the HRA shall possess full
discretion with respect to the actions to be taken by the HRA
pursuant to the Letter of Intent.
Motion carried 4-0.
The Special City Council meeting was adjourned by unanimous
consent at 8:22 p.m.
Chairperson Harms and HRA Commissioners thanked Mayor Quam
for his work. Mr. Harms then went on to other HRA scheduled
business.
1
HRA Meeting Minutes (5) December 17, 1990
HRA
Item #2 APPROVAL OF MINUTES
M/Luettinger, S/Helmberger to approve the minutes of the HRA
meeting of November 19, 1990.
Motion carried 4=0.
HRA
Item #3 OPPORTUNITY FOR CITIZENS TO ADDRESS THE HRA ON ITEMS
NOT ON THE AGENDA
No one wished to address the HRA.
HRA
Item #4 AUTHORIZATION TO EXECUTE AGREEMENTS WITH MINNEGASCO AND
SELF RELIANCE CENTER. HRA LETTER NO. 48
Executive Director Prosser reviewed HRA Letter No. 48
regarding authorization to execute agreement with Minnegasco and
the Self Reliance Center for funding and delivery of Project Air
weatherization services.
,,M/Helmberger, S/Luettinger that the following resolution be
adopted; that it be spread in the resolution book and that it be
made part of these minutes:
HRA RESOLUTION NO. 407
RESOLUTION RELATING TO PROVIDING
WEATHERIZATION PROGRAM SERVICES
Motion carried 4-0. This resolution appears as Resolution
No. 407 in Resolution Book No. 3.
HRA
Item #5 AUTHORIZATION TO EXTEND AGREEMENTS WITH NORTHERN STATES
POWER COMPANY AND THE SELF RELIANCE CENTER. HRA LETTER
N0. 49
Executive Director Prosser reviewed HRA Letter No. 49
regarding authorization to extend agreements with Northern States
Power Company and the Self Reliance Center for funding and
delivery of Home Energy Checkup services.
HRA Meeting Minutes (6) December 17, 1990
M/Ludeman, S/Luettinger that the following resolution be
adopted; that it be spread in the resolution book and that it be
made part of these minutes:
HRA RESOLUTION NO. 408
RESOLUTION RELATING TO PROVIDING ENERGY AUDIT SERVICES
Motion carried 4-0. This resolution appears as Resolution
No. 408 in Resolution Hook No. 3.
HRA
Item #6 REPORT OF EXECUTIVE DIRECTOR
Executive Director Prosser reported that the staff was
looking at how the legislature may assist the City in
redevelopment.
It was noted that the January and February HRA meeting would
be held ®n th® Tuesday f'ellowing ~~he n®rmal P~Ionday meeting date
due to the holidays.
HRA
Item #7 CLAIMS AND PAYROLLS
M/Luettinger, S/Helmberger that the following claims and
payrolls be approved:
FIRST WESTERN BANK
Checks 1060-1066; 1930-2020; $399,350.28
9730-9756; 10266-10296
Checks 1029 Section 8 $ 50,000.00
Motion carried 4-0.
HRA
Item #8 ADJOURNMENT
The meeting was adjourned by unanim\ consent a 8.2 p.m.
Date Approved : 1 / 22 / 91 '~ ~~~~~
'Thomas Harm Chair
.,ail
ev n L. ev ch Ja s D. Prosser
Acting City Clerk xecutive Director