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HRA 03/09/1989 - 29662,� CITY OF FRIDLEY HOII3ING & REDEVELOPMENT AIITHORITY MEETING, MARCH 9� 1989 ----------------------------------------------------------------- CALL TO ORDER• Chairman Larry Commers called the March 9, 1989 meeting of the Housing and Redevelopment Authority to order at 7:08 p.m. ROLL CALL; Members Present: Larry Commers, Virginia Schnabel, John Meyer, Walter Rasmussen Members Absent: Duane Prairie Others Present: Jock Robertson, Executive Director of HRA Bill Burns, City Manager Rick Pribyl, Finance Director Mayor William Nee Councilwoman Nancy Jorgenson Councilman Dennis Schneider Councilman Edward Fitzpatrick ^ Councilman Steve Billings James Casserly Cheryl Stinski Pat Fisher Barry Warner, Barton-Aschman � APPROVAL OF FEBRUARY 9, 1989, HOUSING & REDEVELOPMENT AUTHORITY MINUTES• MOTION by Ms. Schnabel, seconded by Mr. Rasmussen, to approve the February 9, 1989, Housinq & Redevelopment Authority minutes as written. IIPON A VOICE VOTE, ALL VOTING AYE, CBAIRPERSON COMMER3 DECLARED THE MOTION CARRIED IINANIMOIISLY. 1. INFORMATION ON TANURB PROPOSAL FOR REDEVELOPMENT OF SOUTHWEST QUADRANT OF UNIVERSITY AVENUE & MISSISSIPPI STREET: Mr. Commers stated a letter dated February 28, 1989 has been submitted to David Newman from Edwin Chanin which states that Tanurb has exercised its right to terminate the Purchase Agreements for the University Avenue Shopping Center parcel and the Rice Plaza parcel. Mr. Robertson stated he will attempt to obtain further information � � HOIISING & REDEVELOPMENT AIITHORITY MEETING, MARCH 9, 1989 PAGE 2 from Tanurb and contact Coldwell Banker to determine why this project will not be proceeding. 2. INFORMATION OF WINFIELD PROPOSAL FOR REDEVELOPMENT OF 57TH PLACE• Mr. Commers stated Twin City Testing is not able to proceed with their contract with the HRA because of a conflict of interest. Mr. Robertson stated he has approached the Pollution Control Agency and they are evaluating the monitoring well data that Mr. Flaherty, the former owner, is obligated to provide. He stated Mr. Flaherty is submitting necessary documents to the Pollution Control Agency to satisfy requirements to receive reimbursement up to 75 percent of the maintenance evaluation and correction costs. Mr. Robertson stated the evaluation of this data is taking place on a monthly basis. Mr. Robertson stated it might take up to six months to obtain enough data to prescribe a cleanup procedure and another six months to accomplish the cleanup. He stated he will report the results received from the Pollution Control Agency on a monthly basis to the HRA. Mr. Robertson stated Mr. Flaherty submits materials monthly to the Pollution Control Agency. Mr. Commers asked when this procedure began and Mr. Robertson stated it started in January. Mr. Robertson stated Mr. Flaherty felt the greatest concern was the contingency clause with Crosstown Bank in obtaining the billboard. He stated Winfield and Mr. Dorn are trying to make some kind of arrangement for Crosstown Bank's sign. He stated they would be willing to go to some length to tailor this sign to the City's satisfaction. Mr. Robertson stated since they have to wait for the soil correction, they will pursue the question of the sign simultaneously. Mr. Meyer was asked if defining the problem was not being accelerated because Twin City Testing had withdrawn. Mr. Robertson stated he would check into this question and submit a recommendation to the HRA next month. Mr. Commers stated it is thought the HRA had to complete the testing; however, since the Pollution Control Agency is now involved, they are making the original property owner responsible for this cleanup. Mr. Rasmussen asked the developer's reaction to the delay. Mr. Robertson stated he accepted it and indicated he would pursue the sign variance while waiting for the test results. � HOUSING & REDEVELOPMENT AIITHORITY MEETING, MARCH 9, 1989 PAGE 3 Mr. Meyer stated he cannot understand why the developer who was in such a rush before is now willing to relax the schedule for six months or more. He questioned why the contamination issue is not actively being pursued. Mr. Robertson stated staff was advised they had hired another firm to independently evaluate the data given them by Ashland a year ago. Mr. Meyez felt the time for the test results and correction should be accelerated. Mr. Commers felt staff should probably check if the six month period for testing could be shortened. Mr. Robertson stated this is a good suggestion, but the question is also how long the Pollution Control Agency has the soil samples before they are analyzed. Ms. Schnabel stated she is under the impression that the bank is very eager for the development and construction of their facility. Mr. Rasmussen stated he would agree the developer seemed eager to ^ proceed and it seems peculiar that they are willing to wait for this length of time. Ms. Schnabel asked if anyone such as Mr. Flaherty or the Pollution Control Agency is on site. Mr. Robertson stated Mr. Flaherty is on site because he was the prior owner and responsible for the cleanup. He stated there are test wells on site. Mr. Commers felt the HRA should obtain further information before action is taken on an extension of the agreement. 3. CONSIDERATION OF EASEMENTS FOR FRIDLEY PLAZA OFFICE BUILDING: Mr. Commers stated he is concerned about the expenses and legal fees incurred with this issue as it seems additional legal opinions are needed from the HRA. Mr. Robertson stated, hopefully, the closing for the sale of this office building will take place this Friday. He stated in the course of preparing for the closing, a title issue arose. He stated the HRA entered into a long term lease of the adjoining parking facilities with the owners of the Fridley Plaza Office Building and an amendment entered into due to the HRA's decision to construct a structured parking facility on this site. He stated ^ it has been brought to the City's attention that the HRA only owns � the eastern portion of this parking facility, and the balance is �'1 HOIISING & REDEVELOPMENT AIITHORITY MEETING, MARCH 9, 1989 PAGE 4 owned by the City. Mr. Robertson stated the City's legal counsel, David Newman, is suggesting the City deed over that portion of the parking ramp located on City property to the HRA so that the lease agreement for the parking will be exclusively with the HRA rather than having two leases, one with the IiRA and one with the City. He stated the City Council acted favorably on this suggestion at their March 6, 1989, meeting. Mr. Robertson recommended the HRA accept this parcel of land. Ms. Schnabel asked if the HRA incurs any legal obligations by accepting this property. Mr. Robertson stated he did not believe so and neither did the Assistant City Attorney, David Newman. Mr. Commers questioned if the HRA has liability coverage under the City's policy. Mr. Pribyl felt for that particular piece of property, the HRA is covered for general liability under the City's policy. Mr. Commers stated no action is needed on the part of the HRA. He � expressed thanks to the Council for deeding a portion of this lot to the HRA. 4. CONSIDERATION OF STINSKI PROPOSAL FOR REDEVELOPMENT ON HILLWIND ROAD• n Mr. Robertson stated Mr. Casserly has submitted his analysis of this project in a memo dated March 8, 1989. He stated Mr. Casserly's report indicates it would take a drastic change in the HRA's financial assistance policy in order for this project to meet the request of the developer. Mr. Casserly stated he has had conversations with Mr. Fisher, Ms. Stinski's financial consultant. He stated he does not doubt their figures presented for this project. He stated they are proposing a very high quality project and need the assistance in order to meet the cash flow. He stated he is not disputing the numbers and Ms. Stinski and Mr. Fisher have provided all the information requested. Mr. Casserly stated, however, in providing assistance, the HRA has done so within some basic guidelines. Mr. Casserly stated assistance is usually provided in the form of a grant of 5 percent of the estimated market value of the project which would amount to approximately $150,000 or a loan amounting to 15 percent of the estimated market value of the project which would amount to approximately $373,000 and paid back with deferred interest over a 15 year period. He stated whether assistance is in the form of a loan or grant, the petitioner must still qualify, � HOUSING & REDEVELOPMENT AUTHORITY I�EETING, MARCH 9, 1989 PAGE 5 and these funds can only be used for tax increment expenditures such as utility improvements, demolition, soil correction, etc. Mr. Casserly stated the developer is requesting a grant of 15 percent or $373,000 and not a loan. He stated he would recommend a grant of 5 percent or a loan of 15 percent or a combination of a loan and grant, but within those confines. Mr. Fisher stated the only way the project will work is to obtain a 15 percent grant. Mr. Meyer asked if it is necessary to have underground parking. Ms. Stinski stated it is necessary in order to meet City Code requirements for the parking. Mr. Robertson stated the proposed building is too large for the lot and the only way to meet the parking requirement is to have underground parking. He stated the other alternative is to acquire additional land to have all outside parking. Ms. Schnabel asked if the costs of this underground parking are consistent with the parking ramp proposed for the renovated Civic Center. Mr. Robertson stated these costs are consistent. � Mr. Rasmussen stated as long as this is a quality building, he would be in favor of assistance on a loan basis or combination of a grant and loan. Mr. Commers felt some direction should probably be given to the developer as to the HRA's position. Mr. Robertson stated staff is not willing to spend much more time on this project unless it can be proven it will work. Ms. Schnabel stated she would have a difficult time justifying any deviation from their current guidelines. She stated she wants a quality development; however, there are other areas of redevelopment in the City which must also be considered. MOTION by Mr. Meyer, seconded by Ms. Schnabel, to re-affirm the HRA's previous policy of assistance regarding the Hillwind office proj ect. Mr. Fisher asked if financing for this project can be done within the HRA's guidelines, if it is approved. Mr. Commers felt if the developer can meet the guidelines, the HRA is willing to make the commitment for financial assistance. He stated the building itself has not been an issue and the HRA would ^ welcome this type of facility. '�'� HOIISING & REDEVELOPMENT AIITHORITY MEETING, MARCH 9, 1989 PAGE 6 Mr. Meyer stated he knows this is a high quality building, however, if the plan for the facility changes, he would want assurances that a lower quality structure would not be constructed. IIPON A VOICE VOTE TAKEN ON T8E ABOVE MOTION, ALL VOTING AYE, CHAIRPERBON COMMER3 DECLARED THE MOTION CARRIED IINANIMOII3LY. 5. CONSIDERATION OF BIDS FOR 1989 LAKE POINTE MAINTENANCE: Mr. Robertson stated bids were received for the Lake Pointe Maintenance Project #187 and staff recommends the contract be awarded to the low bidder, Greenmasters, Inc., for $34,220. He stated Greenmasters is very experienced in this line of work and this bid is slightly lower than the previous contract and the bid from the company who received the contract last year. Mr. Robertson stated there is also twice as much sod to maintain this year as there was last year. MOTION by Ms. Schnabel, seconded by Mr. Meyer, to award the Lake Pointe Maintenance Project #187 to Greenmasters, Inc. for $34,220. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED IINANIMOIISLY. ,,,•� 6. CONSIDERATION OF UNIVERSITY AVENUE CORRIDOR IMPROVEMENTS SCHEDULE• Mr. Robertson stated he reviewed the background and history of this project with the Council last Monday evening. He stated one of the major concerns was the compatibility between the light rail transit proposal and the landscaping design prepared by Barton-Aschman, Inc. He stated although there is no basic incompatibility between landscaping and light rail transit, the timing is critical. Mr. Robertson stated the opinion of Barton-Aschman, who is completing some work for Hennepin County on light rail transit, is that light rail is farther into the future than what is being discussed in Anoka County. He stated Hennepin County has set priorities for other lines, before one in Anoka County, and such a line needs Hennepin County's participation. Mr. Robertson stated the Council's concern is the private properties on University Avenue adjacent to the public right-of- way and what may be done to accelerate redevelopment of the underdeveloped properties to coincide with the improvements in the public right-of-way. Mayor Nee stated he has mixed feelings about light rail transit and whether or not it will become reality in the near future. He stated if this occurs in five or ten years really does not make a ^ difference, if the investment can be amortized. He stated his own � personal feeling is that things have changed since the University !"� ^ �"1 HOII3ING & REDEVELOPMENT AIITHORITY MEETING, MARCH 9, 1989 PAGE 7 Avenue Corridor improvements were discussed. Mayor Nee stated that Kirk Hart, who represents the Chamber of Commerce, stated the business community requested that University Avenue be cleaned up and something done with the grass and fencing. He stated although the businesses would not object to the improvement, they would not take credit for the expenditure of one million dollars or more for this project. Mayor Nee stated he felt he could not rationalize this improvement which is, essentially cosmetic, unless it is part of a plan to improve the entire area. Mayor Nee stated in looking at priorities, he felt there is a need to address the underdeveloped and vacant properties on University between 57th and 61st Avenues. Mr. Rasmussen stated he would concur with Mayor Nee's comments. Councilwoman Jorgenson stated the Council attended a retreat this past weekend and one of the items covered was the redevelopment policy and what the Council envisions for Fridley in the future. She felt to proceed with the present plan for improving University Avenue would mean blighted areas would still remain. Councilwoman Jorgenson felt it may be better to concentrate on a particular area along University Avenue for redevelopment between 57th and 61st Avenues since this is an entrance to the City. She felt if funds were spent just to improve the aesthetics by installing brick and landscaping, she did not know how the citizens would react. Councilwoman Jorgenson stated she is not against landscaping and improving University Avenue, but she felt this should be done in conjunction with a plan to also improve the blighted areas. Mr. Meyer stated saying, however, improved, this may to the area. he understands what Councilwoman Jorgenson is if the cosmetics along University Avenue are be the key to drawing more attractive businesses Councilwoman Jorgenson stated she is not against the improvement and would like some of it done, but they should also consider the properties between 57th and 61st Avenues. She felt if there is redevelopment, quality businesses will be attracted to the area. Mr. Meyer asked where the Council felt funds might be spent and not scandalize the community. Councilwoman Jorgenson stated she felt perhaps half of the amount proposed to be spent on improving University Avenue should be allotted for redevelopment of the area between 57th and 61st Avenues. She stated this is her personal opinion and she has not had a lot of comments from the residents. Mr. Commers stated there was public participation when the proposed improvement of University Avenue was originally discussed. �� HOIISING & RBDEVELOPMENT AIITHORITY MEETING, MARCH 9, 19$9 PAGE 8 Councilwoman Jorgenson stated from Kirk Hart's comments, she felt the proposed plan for improving University Avenue was not exactly what was wanted by the business community. She stated they wanted a cleanup, weeds removed, and something done with the fencing. Councilwoman Jorgenson stated consideration also has to be given to the possibility of light rail transit. She stated if this becomes reality and the line proceeds along University Avenue, some of the landscaping proposed in this improvement plan may have to be redone. She stated she liked the idea for improving University Avenue, but did not feel the timing is right. Mr. Commers stated the timing may have changed, but it cannot be said that this project was not reviewed and assessed at the time it was first considered. He stated there was broad participation, including the Chamber of Commerce, and, at the time, the project seemed appropriate. He felt the economics have changed significantly so it does deserve reconsideration. Councilwoman Jorgenson stated she did not mean to insinuate that there was not active participation, but felt the times have changed. Ms. Schnabel stated she also has some reservations about this n improvement even though she chaired the committee for these improvements on University Avenue. She stated it was felt if aesthetic changes were made to improve University, this might attract businesses to the community. She stated if a new bank is constructed at 57th Avenue, the rest of University Avenue might start to improve. Ms. Schnabel felt they have to arrive at a goal and then adhere to it. Financing is a critical part. Councilwoman Jorgenson stated there are some very nice developments on University Avenue in the northern portion of the City and thought perhaps concentration should be in the urban section rather than the rural section. Mayor Nee stated the City has faced this problem on the south portion of University for the last 25 years. He stated it will not change without some intervention. Councilman Fitzpatrick stated he agreed with Mayor Nee's comment. He felt improvement in this area should be an HRA project. He stated he cannot help but feel that light rail transit is many years away and should not be one of the biggest considerations. Councilman Schneider stated in the retreat attended by the Council, one of the goals was to improve the image of Fridley. He stated he supports the idea of aesthetic improvement, but not to the extent proposed. He stated in looking at the new development on � East Moore Lake Drive, he wonders if this development would have taken place if other improvements had not been made in the area. �� ,�1 /"� HOIISING & REDEVELOPMENT AIITHORITY MEETING, MARCH 9, 1989 PAGE 9 He felt if there could be some inducement to improve the area around 57th Avenue, it might benefit the entire area. Councilman Schneider stated he was concerned about the maintenance issue because if improvements are done and not maintained, it becomes very counter-productive. Councilman Billings stated even though he was not a member of the Council when the University Avenue improvement was considered, he was aware of it as he was Chairman of the Planning Commission. He stated the persons who are now speaking hesitantly about the project were the same ones who were hesitant when the project was originally considered. Councilman Billings stated there were funds available and the advice was if they were not spent, the City would lose the funding. He felt this influenced decisions on whether to proceed with this improvement. He stated he felt there has been some realization that some of the things expected have not materialized. Councilman Billings stated some of the Council members feel that a greater concentration of funds to improve the intersection and site at 57th and University would have a greater impact than spreading the funds throughout the University Avenue Corridor. He stated in analyzing the situation, the question is if it is better to do some improvements throughout the entire Corridor or to have an improvement that would make a significant impact to show the City is serious about making the City attractive to new businesses. Councilman Billings stated he is not necessarily speaking for or against the project for the University Avenue Corridor. He felt the concerns of the Council are the same as they were when this improvement was discussed and they are now taking a second look. Mr. Commers asked if the HRA cannot do something to improve the south portion of University Avenue, does the Council feel they should not proceed with this project? Mayor ATee stated he felt something should not be done this year. He stated if the City makes a highly visible investment and light rail would proceed, improvements that were done may need to be removed. Mr. Commers stated the City will be faced with light rail transit from now to the next century and may never well see it materialize. He stated he is concerned about tying light rail transit in with other developments, but there might be financial reasons to reassess the plans at this point. Mr. Commers stated if the HRA proceeds with redevelopment between 57th and 61st Avenues, a broad based plan is needed. Ms. Schnabel felt there should be a goal to which the Council concurs to allow them to begin their next focus. She felt the HOIISING & REDEVELOPMENT AIITHORITY ME$TING, MARC$ 9, 1989 PAGE 10 �� Council should take the next step to determine what they foresee for the City. Ms. Schnabel asked if this would be acceptable if the original plan for improvement of University Avenue is scaled back to eliminate the lighting and paving and focus on the maintenance. Mayor Nee stated he would have no problem with this suggestion. Ms. Schnabel stated in the East Moore Lake Drive development there was a distinct advantage as a developer came to them with a plan. This is not the case at 57th Avenue. She stated there could be problems if businesses are aleared out, and there are no plans for development. Mayor Nee stated there is some rational to provide housing in some of this area, and it would be a major improvement. Councilman Billings stated he felt some of the concerns of the Council are that improvements might be done and then have to be removed because of light rail transit. Mr. Commers stated the HRA would like some direction from the Council regarding their priorities. There probably should be a ^ joint meeting. Mr. Robertson stated that as a result of the Council meeting last Monday evening, the City Manager, Bill Burns, requested suggestions on ways to proceed. He stated the question was raised how much the original Phase 1 proposal would cost if it was done this year. He stated that both Mr. Warner of Barton-Aschman and he had independ- ently estimated about $700,000. He stated this amount is split between the rural and urban sections. Mr. Robertson presented a drawing which outlined the areas the Council felt were critical for redevelopment. He stated a rough estimate, using 57th Place as an example, for the total cost of redevelopment including acquisition, relocation, demolition, and utility relocation is about $700,00 to $750,000. He stated this amount is about double what the Assessor had as the estimated market value. He stated current sales are running about $2.50 to $4.00 a square foot. Mr. Robertson stated that to explore the possibilities for redevelopment would take some further research and felt a timetable to accomplish this work would be about six months in order to prioritize and have a better definition of the costs. Ms. Schnabel stated there are a lot of issues involved in this area. She felt the City cannot afford to have parking for light � rail transit in this area. � ^ n HOIISING & REDEVELOPMENT AIITHORITY MEETING, MARCH 9, 1989 PAGE 11 Mr. Robertson stated the present schedule for the improvement of the University Avenue corridor is that the Department of Transportation is reviewing the detailed plans and it is scheduled for spring bidding. He stated staff has been advised by Mr. Warner that bidding should not proceed until plans are definite. He stated if it is necessary to rebid, the HRA can incur some liability. Mr. Meyer agreed the HRA should not proceed with bids unless they have a firm idea that they would proceed. He felt they should regroup after hearing the comments from the Council members. He stated if the business community does not see any advantages, he did not see why the HRA should proceed with what has been planned to date. Mr. Rasmussen stated he has not been in favor of the plan from the beginning, but felt maintenance is almost a necessity. Ms. Schnabel stated some of the principals are gone that were originally involved so their lack of interest might be for many reasons. She felt perhaps the HRA could spend some funds for maintenance in the median and a program for regular mowing, weed control, and possibly re-seeding. Mr. Robertson asked about removal of the fence. Ms. Schnabel a barrier. people from point. stated the fence in front of the businesses acts as She stated the business owners feel it is keeping patronizing their establishments and this is a valid Mr. Commers felt staff should come back with costs for removing the fence and proper maintenance. Mr. Burns felt the maintenance is probably a high priority and should be intensified, however, there should be direction on how to proceed for the future. He stated he felt everyone's top priority is Lake Pointe. Fie suggested perhaps there should be some prioritizing and then determine what is feasible. Ms. Schnabel stated if the HRA were to categorize their interest at this point, Lake Pointe would be the top priority. Mr. Commers felt Lake Pointe has to be the number one priority. He stated until this issue is resolved, the HRA does not know their long-term financial position. He stated, however, he is not sure if he would place the 57th area over the Rice Creek Plaza area. Mayor Nee stated the priorities might be Lake Pointe, Rice Creek Plaza and then the area of 57th Avenue. Mr. Burns stated he would agree with Mayor Nee's assessment of the r'�1 80USING & REDEVELOPMENT AIITHORITY MEETING, MARCH 9, 1989 PAGE 12 priorities. Councilman Billings stated he did not want the HRA to forsake this plan for the University Avenue Corridor improvement simply because it cannot be accomplished at this time. Mr. Warner, Barton-Aschman, stated based on the comments he has heard, he felt it would be prudent to go back to the original master plan that was prepared because it took into consideration improving the appearance of University Avenue without spending a lot of money. He suggested either calling the University of Minnesota for a Turf Specialist or the Department of Transportation for a Turf Grass Expert to review and evaluate the problem. He felt for a nominal investment, the appearance could be greatly improved until the Council is more comfortable with the urban improvements. It was the consensus of the HRA and Council members that Mr. Warner's suggestion should be pursued. Mr. Commers thanked everyone for attending the meeting and stated the HRA will look forward to some long term goals. 6A. RESOLUTION NO. HRA 2-1989 OF THE BOARD OF COMMISSIONERS OF THE ^ FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY APPROVING AND AUTHORIZING THE REIMBURSEMENT TO BARTON-ASCHMAN FOR THE COST OF ADDITIONAL DESIGN SERVICES FOR TRAFFIC SIGNALS. CONTROLS. LIGHTING AND LANDSCAPE MODIFICATIONS: Mr. Robertson asked that the HRA consider this resolution. He stated it is a housekeeping item to reflect the HRA's action taken at their February 11, 1988, meeting. MOTION by Ms. Schnabel, seconded by Mr. Meyer, to adopt Resolution No. HRA 2-1989. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLP,RED THE MOTION CARRIED UNANIMOUSLY. 7. CLAIMS (1865-1875): Mr. Pribyl, Finance Director, stated there are some expenditures regarding the parking ramp and security for the ramp. Mr. Commers asked if these expenditures are within budget. Mr. Pribyl stated they are. Mr. Robertson stated there are some questions about the concrete and these are in the process of being negotiated. He stated there ^ are some rough areas and in some places, the slope is not correct to permit run-off. He stated the clearance also does not meet the 80IISING � REDEVELOPMENT AIITHORITY MEETING, MARCH 9, 1989 PAGE 13 �'�i State requirement of seven feet and in some areas, it is about 1- 3/4 inches lower. Mr. Pribyl stated $80,000 to $90,000 has been withheld to insure that the proper follow-up will be undertaken. MOTION by Mr. Rasmussen, seconded by Mr. Meyer, to approve Check Register Nos. 1865 through 1875. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. ADJOURNMENT: Chairperson Commers adjourned the March 9, 1989 meeting of the Housing and Redevelopment Authority at 9:55 p.m. Respectfully submitted, � ���Q� Carole Haddad Recording Secretary � �