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HRA 03/13/1986 - 29343CITY OF FRIDLEY • HOUSING & REDEVELOPMENT AUTHORITY MEETING MARCH 13, 1986 CALL TO ORDER: Chairperson Commers called the March 13, 1986, Housing & Redevelopment Authority meeting to order at 7:11 p.m. ROLL CALL: Members Present: Larry Commers, Elmars Prieditis, Virginia Schnabel Members Absent: Duane Prairie, Walter Rasmussen Others Present: Nasim Qureshi, HRA Director Jim Robinson, Planning Coordinator Rick Pribyl, City Finance Director Dave Newman, HRA Attorney Jim Casser]y, Miller & Schroeder Ray Stolquist, 5624 Matterhorn Dr. Joel Young, 5695 Quincy St. N.E. Coey Minear, 1291 Gardena Ave. Mel Stolquist, 5624 Matterhorn Dr. David Molda, Vantage Companies, Bloomington Matthew Nicoll, Vantage Companies, " Paul Dahlberg, Vantage Companies, " APPROVAL OF JANUARY 9, 1986, HOUSING & REDEVELOPMENT AUTHORITY MINUTES: MOTION BY MS. SCHNABEL, SECONDED BY MR. PRIEDITIS, TO APPROVE THE JAN. 9, 1986, HOUSING & REDEVELOPMENT AUTHORITY MINUTES. Ms. Schnabel stated she would like to make the following changes on page 8 of the minutes: paragraph 2, add the following words at the end of the sentence: (to pay a sub - tenant of a tenant of the owners of the condemned property). 6th paragraph from the bottom, middle line, change "tenant" to "sub- tenant" UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MINUTES APPROVED AS AMENDED. HOUSING & REDEVELOPMENT AUTHORITY MEETING, MARCH 13, 1986 PAGE 2 • 1. PRESENTATION OF APPRECIATION PLAQUE FOR CAROLYN SVENDSEN: r� L..J • Mr. Commers stated that at this time they had planned to present an appreciation plaque to Ms. Svendsen who served on the HRA for over ten years before moving to Northfield, Minnesota. Apparently, because of the weather, she was unable to attend the meeting. MOTION BY MR. PRIEDITIS, SECONDED BY MS. SCHNABEL, TO TABLE THIS ITEM UNTIL A MEETING WHEN MS. SVENDSEN COULD BE PRESENT. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 2. REQUEST FOR ASSISTANCE FROM'VANTAGE COMPANIES: Mr. Commers stated that in addition to the information in the agenda, the commissioners had received a copy of a proposed contract for development, one between the HRA and Vantage Companies and, for informational purposes, one between the City of Fridley and Vantage Companies. Mr. Qureshi stated that Vantage Companies has requested the City Council to rezone a piece of property located north of 81st Ave. and west of University Ave. Presently, a portion of the property is zoned C -2 and the rest M -2. The request is to rezone to C -3 and C -2. There has already been a hearing and the first reading of the ordinance on the rezoning. The hope was that at the next City Council meeting on March 17, the second reading of the ordinance would be held and the property rezoned. Mr. Qureshi stated Vantage Companies' proposal was to develop at least the first two phases. Phase 1 was the development of the 100,000 sq. ft. Wholesale Club, and then phase 2 was 70- 75,000 sq. ft. of retail. Vantage Companies has indicated there is a severe soil problem on the site and have estimated a cost of $1,750,000 in soil correction. What has been basically worked out is that if Vantage Companies meets certain requirements and does build a 100,000 sq. ft. building in phase 1, if the HRA approves, then the HRA would be providing assistance of $100,000 in soil correction costs. If Vantage Com- panies builds an additional building in phase 2, the HRA would be providing another $50,000 worth of assistance for a potential total of $150,000. A proposed agreement has been prepared that provided that under certain condi- tions, the HRA would provide this assistance. Mr. Qureshi stated representatives from Vantage Companies were in the audience. He showed the HRA the general concept of the development that has been submitted by Vantage to the City. He stated their plans were to complete phase 1 this year. Mr. Commers stated it was his understanding they were handling this project differently than in the past. HOUSING & REDEVELOPMENT'AUTHORITY MEETING, MARCH 13, 1986 PAGE 3 • Mr. Qureshi stated that was correct. In the past they have gotten control of the property and essentially at the same time turned it over to the developers, so it was a matter of deeding back and forth. It was his under- standing that it was the preference of the legal representative of Vantage Companies to not use that method. Mr. Newman and Vantage's legal representative have worked everything out satisfactorily. Mr. Commers stated that, as he understood it, rather than the HRA taking title and upon completion of the project when they would normally get the title back, in this case the HRA's obligation would become payable at the time the building was substantially complete. He stated the discussion at the last meeting with Mr. Paschke and Mr. Dave Harris related to the issuance of the certificate of occupancy, so the question was whether or not the HRA should meet their obligations at the time the certificate of occupancy was issued. Mr. Harris had proposed that timeframe was too long for developers to wait for the assistance. Mr. Newman stated it was his understanding that there were two certificates of occupancy - -one was a temporary certificate which allowed the business to occupy on a temporary basis, and the other was the final certificate of occu? pancy which can take up to an additional year to obtain. This agreement was drafted with the understanding that the payment would be made when the temporary certificate of occupancy was issued. 40 Mr. Commers stated it should be called the temporary certificate of occupancy in the agreement in order to prevent any confusion. Mr. Qureshi stated that if everything works out, the certificate of temporary occupancy should be issued in the month of,October. Mr. Commers stated that, as he understood it, the assistance from the HRA was based on the presentation that there was a requirement of over $1 million in soil correction. Mr. Qureshi stated that was correct. Vantage Companies would have to provide the HRA with documentation'that the soil correction was over $1,000,000. The HRA's total assistance would be $150,000, which was about 15% of the total cost. Mr. Matthew Nicoll stated he was the General Manager and Executive Vice President of the Mpls. Division of Vantage Companies. He stated they are one of the larger developers in the country. They have been in business for 26 years, have 15 separate operating offices in various locations in the United States. Their home base was in Dallas. They have been in Mpls. for 8 -82 years and have developed in Plymouth, Eden Prairie, and Bloomington. Ms. Schnabel stated she had a concern about the water in that area and what happens with the water when the development takes place, especially any impact it might have on Springbrook Nature Center. She also wondered what the City had found out from the environmental assessment worksheet. HOUSING & REDEVELOPMENT AUTHORITY MEETING, MARCH 13, 1986 PAGE 4 U Mr. Qureshi stated Vantage Companies was going to provide subsurface drainage on their property which will go to another drainage system the City has. Also, on 81st the City is proposing a subsurface drainage system that will keep the water table low. It was also his understanding that Vantage Companies would be bringing in some good soil and actually try to raise the existing level of the ground so there is at least 4 ft. or more difference from where the water table is right now. Mr. Robinson stated the project did not actually require a formal environ- mental assessment worksheet, but the City did ask Vantage to complete one and submit it for informal review. The City submitted that informal environ- mental assessment worksheet to the Environmental Quality Board and the Department of Natural Resources for their general comments, but there were no major concerns. There were a few general comments about water run -off, and the City feels that can be handled adequately by the engineering staff. Mr. Qureshi stated that if the HRA feels the agreement was satisfactory, action needed by the HRA was to approve the resolution which authorized the Chairperson and himself to execute the agreement conditioned upon certain things that will still have to be worked out with Vantage Companies between now and when the City Council completes the rezoning. One of the concerns shown from the beginning was the landscaping and the exterior quality of the facilities. MOTION BY MS. SCHNABEL, SECONDED BY MR. PRIEDITIS, TO APPROVE RESOLUTION NO. HRA 1 1986 AUTHORIZING EXECUTION OF THE CONTRACT FOR PRIVATE DEVELOP- MENT BETWEEN THE HRA AND VANTAGE COMPANIES. UPON A VOICE VOTE, ALL. VOTING AYE,CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 3. RESIDENTIAL RELOCATION CLAIM FOR PETER LIND RUKES 5747 CENTRAL AVENUE • L.. , I 1 \1 UL L. 1 , 1'111'111LJV I h - Mr. Robinson stated that, as recommended at the last meeting, Staff did check the residence to see if it was a legal apartment. He stated there were some technical violations; but in researching with the Washington D.C. office, the technical violations were no reason to disallow the relocation and that the HRA was obligated to pay the relocation costs. MOTION BY MR. PRIEDITIS, SECONDED BY MS. SCHNABEL, TO APPROVE RESIDENTIAL RELOCATION EXPENSES IN THE AMOUNT OF $41#450 TO PETER -LIND RUKES,`5747 CENTRAL AVENUE N.E. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. • HOUSING & REDEVELOPMENT AUTHORITY MEETING, MARCH 13, 1986 PAGE 5 MOTION BY MS. SCHNABEL, SECONDED BY MR. PRIEDITIS, TO APPROVE RESOLUTION NO. HRA 2 1986 AUTHORIZING THE SALE AND REMOVAL OF THE STRUCTURES AT 5747 CENTRAL AVENUE N.E. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 4. REPORT ON THE FEES FOR THE $5, 600,000.CAPITAL APPRECIATION BOND AND 50,000 VARIABLE RATE GENER L' OBLIGATION TAX INCREMENT BONDS: Mr. Qureshi stated the HRA had asked Staff to provide them with information on the fees they have paid on both of these instruments. The memo from Mr. Pribyl to Mr. Qureshi gave the HRA that information and some of the back- ground on it. He stated Mr. Casserly from Miller & Schroeder was also at the meeting to answer questions. Mr. Commers stated he had had two questions, one was on what the actual expenses were, and the other was related to the transaction btween the HRA and Woodbridge Properties. He stated maybe the HRA should ask the Staff to develop some criteria regarding the costs and the negotiations that went into it. When they originally looked at the agreement with Woodbridge, they had an agreement that did not necessarily talk about the HRA paying all Wood bridge's expenses. The agreement the HRA had before them at the December meeting did not provide for that. There were some drafts that apparently included that, but at the closing when it came time for the contract to be signed, the HRA ended up with the Benson- Malkerson fee of $100,000, Miller -& Schroeder's $84,000 fee, and some other expenses Mr. Commers did not think were quite fair. He thought it would be to the Staff's advantage to have some criteria and guidelines to follow in negotiating a contract. He did not think they should have contracts negotiated open- ended. They should know ahead of time if they are going to be paying anybody else's expenses; Mr. Qureshi stated that, as the Commissioners knew, it was a very unusual instrument they came up with on this property. He also did not see, at least in the foreseeable future, another situation where they would use this kind of instrument and be under the same time restraints as this. He stated the numbers by themselves did not look very good, but in looking at the total picture, the HRA actually came out quite well. Mr. Qureshi stated he had no problem with anything the HRA felt was appropriate. Because of the situation and time constraints, maybe the Staff did not give the HRA the quality of information they should have; however, if the same situation arose in the future, Staff would attempt to be more concerned and conscious of the costs and make the HRA aware of all the costs. Mr. Commers stated that if these things had been reasonably explained to the HRA, they might not have had a problem. There were a lot of reasonable explanations for the way things were done, but he did not think it was a good procedure, and they should not proceed in this way in the future. HOUSING & REDEVELOPMENT AUTHORITY MEETING, MARCH 13, 1986 PAGE 6 5. CONSIDERATION OF A RESOLUTION DESIGNATING OFFICIAL DEPOSITORIES FOR THE FRIDLEY HOUSING & R DEVEL PME T' AUTHORITY:, MOTION BY MR. PRIEDITIS, SECONDED BY MS. SCHNABEL, TO APPROVE RESOLUTION NO. HRA 3 1986 DESIGNATING OFFICIAL DEPOSITORIES FOR THE FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY AT THE FRIDLEY STATE BANK. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 6. CONSIDERATION OF APPROVAL OF AN AGREEMENT BETWEEN THE'FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY AND GERALD'JOHNSON'REGARDING 'S GS' CONDUCTED BY WOODBRIDGE'PROPERTIES, INC.: MOTION BY MS. SCHNABEL, SECONDED BY MR. PRIEDITIS, TO APPROVE AN AGREEMENT BETWEEN THE FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY AND GERALD JOHNSON AND THE AGREEMENT BETWEEN THE FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY AND WOODBRIDGE PROPERTIES. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 7. CHECK REGISTER: MOTION BY MR. PRIEDITIS, SECONDED BY MS. SCHNABEL, TO APPROVE THE CHECK REGISTER AS PRESENTED. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 8. OTHER BUSINESS: Mr. Commers stated the Commissioners had received a copy of a March 7 memo from.the owners who are requesting that the HRA purchase their property which was near the Saliterman property on Old Central. Mr. Qurish stated this was a little over an acre in size. There was a house on the property but it was removed because of the structural condition. He was asking for some input from the HRA as to whether they should pursue the acquisition of this property at this time. The HRA received the letter and information into the record but agreed to take no action at this time. n . HOUSING & REDEVELOPMENT AUTHORITY MEETING, MARCH 1 13, 1986 PAGE 7 ADJOURNMENT; MOTION BY MR. PRIEDITIS, SECONDED BY MS. SCHNABEL, TO ADJOURN THE MEETING. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MARCH 13, 1986, HOUSING & REDEVELOPMENT AUTHORITY MEETING ADJOURNED AT 9 :00 P.M. Respectfully sub itted, Zk 111T 1P - UnX baba Recording Secretary U • PAGE 8 T 7/L �zyi �. -rovbpr- C"eo,,. �'��