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HRA 06/27/1991 - 6377HOUSING AND REDEVELOPMENT AUTHORITY MEETING, THURSDAY, JUNE 27, 1991 7:30 P.M. WILLIAM BURNS EXECUTIVE DIRECTOR OF HRA F CITY OF FRIDLEY A G E N D A HOUSING & REDEVELOPMENT AUTHORITY THURSDAY, JUNE 27, 1991, 7:30, Location: City Council Chambers Fridley Municipal Center 6431 University Avenue N.E. CALL TO ORDER: ROLL CALL: APPROVAL OF MINUTES: May 9, 1991 ACTION ITEMS• 1. Consider Request by Dr. Michael Park to Forgive a Portion of the Second Mortgage on the Fridley Plaza Office Building 2. Consider Application for Tax Increment Financing Assistance for Cub Foods Site 3. Review Approval and Adoption of Expansion of Redevelopment Project Area and Creation of TIF District #11 Aar 4. Discuss Status of Rapid Oil Site 5. Consideration of Rice Plaza Items 6. Approve Removal of Tree Stumps at Lake Pointe 7. Claims and Expenses INFORMATION ITEMS: 8. Memo from John Flora Regarding University Avenue Improvements 9. Policy Discussion Regarding School District TIF Turnbacks 10. Update on Fridley Town Square 11. Update on Mississippi Street Improvement Project 12. Other Business: ADJOURNMENT CITY OF FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 91 1991 CALL TO ORDER: Vice - Chairperson Redevelopment Au- ROLL CALL: Members Present: Members Absent: Schnabel called the May 9, 1991, Housing & thority meeting to order at 7:35 p.m. Virginia Schnabel, Duane Prairie, John Meyer, Jim McFarland Larry Commers Others Present: William Burns, Executive Director of HRA Barbara Dacy, Community Development Director Virgil Herrick, HRA Attorney Paul Hansen, Accountant Jim Casserly, Consultant George Borer, Attorney for Jai Suh Doug Erickson, Fridley Focus APPROVAL OF APRIL 4, 1991, HOUSING & REDEVELOPMENT AUTHORITY MINUTES• MOTION by Mr. Prairie, seconded by Mr. McFarland, to approve the April 4, 1991, Housing & Redevelopment Authority minutes as written. UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. 1. CONSIDERATION OF UNIVERSITY AVENUE SIGNALIZATION REOUEST• Mr. Burns stated MnDOT is proposing to replace the signals at approximately nine University Avenue intersections. Two of them are in the University Avenue Corridor project plan which the HRA had previously defined. The project cost is projected at $680,000, 90% of the project cost is to be covered by Federal Hazard Elimination and Safety Funds. The Fridley share is projected at $10,375. Mr. Burns stated John Flora, Public Works Director, said that this would be an opportunity for the HRA to incorporate the signalization recommendations that were contained in the University Avenue Corridor Plan for two intersections - -57th Avenue and 61st Avenue. The original forecast developed by staff and Barton - Aschman at the time the University Avenue HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 2 Corridor was formulated was $164,000, $82,000 for each intersection. Mr. Flora said they should get what was in that plan for $40,000 if they incorporate these items in the MnDOT workplan, and he is recommending the HRA give him the authority to expend $40,000 for that purpose. Mr. Burns stated this money will provide the internally illuminated street name signs Mr. Flora has been suggesting for all major city intersections. There are a number of other improvements that are associated with making those two intersections more pedestrian friendly. The HRA's $40,000 would go toward the cost of placing signal standards for improved pedestrian pushbutton controls in the medians and toward the installation of thermo- plastic striping and stop lines at those intersections. Mr. Meyer asked what the intersections would get with the "plain Jane" MnDOT intersection improvement plan. Mr. Burns stated he believed the "plain Jane" MnDOT plan provides only for upgraded signals. In fact, he believed the MnDOT plan will strip the signal standards out of the medians. The MnDOT plan will not provide the internally illuminated street name signs or pedestrian markings as suggested by Mr. Flora. Mr. Meyer asked why MnDOT would want to remove the signal standards. Mr. Burns stated he did not know the answer to that question. Staff will try to get that information. Ms. Dacy stated MnDOT is aware of the Barton - Aschman plans for the entire corridor. In fact, prior to the LRT issue coming up in 1989, the City had actually progressed to the level of receiving a permit from MnDOT. Ms. Schnabel asked if the illuminated street signs will be consistent up and down University Avenue, or will they just be at these two intersections? Ms. Dacy stated illuminated street signs are proposed at the Mississippi intersection and, if approved, at the 57th and 61st Avenues at this time; and then as other intersections come on board to be improved by MnDOT or the HRA corridor plan is implemented, they would be incorporated into those plans. Mr. Hansen stated that the HRA has undesignated funds that are available at this time to cover the $40,000. Mr. Meyer stated that if they are looking at these two new signals on University Avenue, then it makes him think of HOUSING -& REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 3 signals at East River Road and Highway 65. Is there a long range plan to illuminate all the major traffic intersections? Mr. Burns stated the long range plan is to provide the illuminated signs at all major intersections of the three major traffic arteries: East River Road, University Avenue, and Highway 65. Ms. Dacy stated the HRA expense would only be on University Avenue, because that is the plan that was authored and approved by the HRA. MOTION by Mr. Prairie, seconded by Mr. Meyer, to authorize the expenditure of $40,000 for the improvement of two traffic intersections on University Avenue at 57th Avenue and 61st Avenue. These improvements will include: 1. Putting the signal poles in the medians rather than at the corners. 2. Upgrading and replacement of pedestrian signals. 3. Installing internally illuminated street signs. UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. Mr. Meyer asked if staff could get more information for the next meeting on the signal improvements. Mr. Burns agreed that more information is needed. 2. APPROVE HOUSING STUDY OUTLINE: Ms. Dacy stated that at the last HRA meeting, one of staff's recommendations from the interviews they did of other first ring suburbs was to look at conducting a housing study so that the HRA could identify what opportunities there are for successful redevelopment projects in specific areas and what they need to do to maximize those opportunities with the programs that are available. Ms. Dacy stated the study that staff referred to was the Brooklyn Center study, and staff reviewed the Executive Summary of that study at the last meeting. Staff has prepared a detailed outline of the scope of the proposed housing study for the HRA's concurrence or recommendations. It was staff's understanding from the lasts meeting that the HRA did not have a preference as to the consultant, but they did want to review the scope of the study and the cost. a HOUSING & REDEVELOPMENT AUTHORITY MEETING. MAY 9, 1991 PAGE 4 Ms. Dacy stated the Brooklyn Center study cost about $28,000. The same consulting firm has done a study for the City of Roseville which cost about $12,000- 15,000. The difference between the two studies is that the Brooklyn Center study was a neighborhood -by- neighborhood analysis, a very detailed approach. At this time, $25,000 is allocated in the HRA budget for a miscellaneous category for studies as needed. Staff would like them to see if they can accomplish the task in the outline for about $15,000 or less. Mr. Meyer stated $15,000 doesn't seem like very much considering all the things they want to accomplish with this outline. He did not want a consultant to take a lot of "boilerplate" information from other sources and put it into the study for $15,000. Is $15, 000 enough to do a study of the things they want or are they being general about so many long listed items that they are not hitting at the heart of what they really want to find out with a study? Ms. Dacy agreed that staff does not want some "boilerplate" data that is applied to Fridley. They want something that fits Fridley, and they want to know what the trade area is and what market they should be looking at and what area of the community they should be looking at for different kinds of housing. Ms. Schnabel stated that under "Analysis ", perhaps they are being too general, and maybe they should better define what they hope to achieve with this type of survey. What areas of housing are aging, and what types of things should they be looking at for upgrading those areas? Should they be encouraging total redevelopment, or is the housing salvageable? Mr. Burns stated he believed they are trying to take a look at the different economic environments in which Fridley exists -- state, regional, and local environments. They want to look at the opportunities and threats, the demographic trends, and other things their economic environments tend to point to, and then, based on those opportunities, determine the opportunities and threats they see in their environment and how they can best make use of the tools that are available to the HRA to address the housing needs in Fridley. Those tools include redevelopment, scattered site housing, housing rehabilitation programs, etc. Mr. Burns stated they know some of the sites they want to redevelop. Why not do a site specific research study? This outline does not necessarily exclude that, and that could be done. HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 5 Mr. Prairie asked if cities share studies with other cities. He would think some studies from neighboring cities would be helpful. Ms. Dacy stated they do have a lot of base data available already. The study will get more specific and get at some of the issues of the local market and how the regional sales affect the Fridley trade area. Ms. Schnabel stated her neighborhood is 25 years old. It is not deteriorating, but it is aging. There are neighborhoods that are a lot older and are deteriorating more. It is her feeling that these older, deteriorating neighborhoods are the ones they should try to save or help to preserve these areas from deterioration. Mr. Herrick stated there are two concepts: redeveloping an older neighborhood, and individual home upgrading. He thought the latter is more realistic. He stated that the Robbinsdale HRA has had a scattered home rehabilitation program for 20 -25 years. If that is one of the things the HRA has in mind, they should contact the City of Robbinsdale for more information. Ms. Dacy stated that is the issue: What tool do they use and what program do they use where? Mr. Burns stated it is more than just using housing incentive programs. The Brooklyn Center study recommends establishing neighborhood organizations, to establish networking, and to use housing inspection and fire inspection and policing programs to create the conditions that protect housing. So, it is more than just focusing on housing. The Brooklyn Center study also shows there are some inappropriate uses. The study would also be aimed at inappropriate land uses as well. Ms. Dacy stated that, regarding Mr. Meyer's concerns about where specifically they should be focusing their redevelopment efforts, III.B under "Analysis" could probably be better stated. Mr. Meyer stated the two items under III.B, "Identify Fridley neighborhoods, and identify strong and weak neighborhoods" are very important. Numbers A and B under IV. Implementation, are very good also. There just seems to be too much generalization, and $15,000- 20,000 will not give them too much. He would like them to have a firm idea of what they want the study to do and the specifics and then appropriate the necessary money to do that kind of study. Mr. McFarland stated he thought they should take a more comprehensive approach so they do not run the risk of having conflicts after all the information is brought together. HOUSING & REDEVELOPMENT AUTHORITY MEETING. MAY 9, 1991 PAGE 6 Staff should work with the consultant to tailor the program to the cost and yet try to get all the benefits they are looking for at the same time. Mr. Meyer stated they should put enough money into the study to give themselves a proper tool that they can do something with, and then do something. Ms. Schnabel agreed. She stated her concern is that they not get a study that is too generalized that they cannot really use. Ms. Dacy stated staff will come back to the June HRA meeting with a more detailed, specific outline. Mr. Burns stated that, between now and the next meeting, staff will work at developing a more focused approach with Maxfield & Associates. 3. CONSIDERATION OF APPROVAL OF EXPENDITURES FOR SHOREWOOD PLAZA REPLAT• Ms. Dacy stated that after the approval of the Shorewood Plaza Plat, the City determined that the plat drawing indicated the wrong street radii in order to conform to the Municipal State Aid street standards. While the road was constructed according to MSA standards, the plat was drawn incorrectly. Complicating this further, the developer could not record the original 1988 plat because of the various description and title difficulties pertaining to the property. The City did a special Surveyor's Certificate of Correction in 1988 which enabled the developer to record the plat. At this time, they have to correct this situation. Ms. Dacy stated the City's share of the cost for replatting this area is between $2,000- 3,000. The HRA's responsibility would be $400 -600. Staff is recommending the HRA authorize the expenditure of no more than $600 toward the replatting costs of Shorewood Plaza. MOTION by Mr. Meyer, seconded by Mr. Prairie, to authorize the expenditure of no more than $600 toward the replatting costs of Shorewood Plaza. UPON A VOICE VOTE, ALL VOTING AYE, VICE- CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. 4. CLAIMS AND EXPENSES: MOTION by Mr. Meyer, seconded by Mr. McFarland, to approve the expenditures of $1,812.60 and $83.55 to Natural Green, Inc., for Lake Pointe maintenance; $3,756.58 to Greenmasters, HOUSING & REDEVELOPMENT AUTHORITY MEETING. MAY 9, 1991 PAGE 7 Inc., for Lake Pointe maintenance; and the check register dated May 2, 1991. UPON A VOICE VOTE, ALL VOTING AYE, VICE- CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. 5. DISCUSSION OF SUH ACQUISITION PROPOSAL: Mr. Burns stated he met with Dr. and Mrs. Suh about two weeks ago. They came in with a proposal to sell the HRA their shopping center property to the HRA for $950,000. They also indicated at that time that the price might be negotiable. Additionally, they suggested that if the HRA did not intend to buy their property that the HRA provide some money for a facelift of their property. Mr. Burns stated he discussed the Suh's proposal with Leon Madsen, City Assessor. He asked Mr. Madsen to comment on the $950,000 offer and showed Mr. Madsen the different methods the Suhs used for calculating the appraised value. It was Mr. Madsen's general reaction that the $950,000 offer was not a clear bargain for the HRA. Mr. Burns stated the position he had recommended to the HRA previously was the Suh property was not needed at this time and that they were not interested in beginning negotiations with Dr. Suh, however, the Suhs could make an offer if they chose to do so. It is his recommendation that the HRA continue to abstain from negotiating a purchase with Dr. and Mrs. Suh. He also recommends the HRA not be involved in providing a facelift for the Suh property. He believed that any money that is put into that property now, they will have to eventually pay for later at the time the property is either condemned or acquired through negotiation. Also, it is logical to expect that the HRA's investment in property improvements be of a more permanent nature, not a temporary nature. Mr. George Borer, attorney for Dr. and Mrs. Suh, stated that Dr. Suh was not able to attend the meeting. He stated Mr. Burns has accurately relayed the conversations with the Suhs. As he has stated before, it is a fairness issue. They feel 12 years in the district is unfair. They believe the City's actions are damaging their clients and affecting the value of the property. Mr. Burns has clearly indicated to his client that the HRA has no desire to enter into negotiations. However, Mr. Burns said they could make an offer, and they have done that. Mr. Meyer stated he agreed with staff's recommendation. HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 9 7. the check is filed, the HRA will have ownership of the property, subject to the conclusion of the value of the property. Ms. Dacy stated Mr. Fitch contacted her that day. He still wants to keep the door open to negotiate a settlement on this issue. Mr. Fitch is having an appraisal done also, and he wants to negotiate with City staff again in about a month based on the results of that appraisal. Staff has informed him that they will not stop the condemnation process, but there might be an opportunity to pull out of the process. Mr. Herrick stated the City is always willing to negotiate even after the condemnation process has started, so if they can come to an agreement, they will finalize the agreement and dismiss the court action. INFORMATION MEMO REGARDING FRIDLEY TOWN SQUARE PROJECT: Ms. Dacy stated Scott Ericson has informed her that, while they have the construction financing in place, they are pursuing a standby permanent mortgage commitment from a life insurance company. He has not yet heard the outcome of this request. She will update the HRA at the next meeting. 8. RESPONSE REGARDING INSURANCE OUESTIONS• Mr. Dacy stated at the last meeting, Chairperson Commers had raised some questions about whether or not HRA members are personally liable for decisions made by the HRA. She stated there are two statutes pertaining to commission liability. Essentially, the first statute, Chapter 469.014, says that commissioners are not personally liable "on its contracts, or for torts not committed or directly authorized by them ". The Authority is liable in contract or in tort in the same manner as a private corporation. Ms. Dacy stated Chairperson Commers also asked staff to look at nonprofit corporations which they did. Minnesota Statute 317A.257 regarding Nonprofit Corporations states that the officers are not civilly liable if the act did not constitute willful or reckless conduct, was done in good faith, and was within the person's scope of responsibility as a director /officer. Ms. Dacy stated the HRA had also raised the question as to whether there was fire coverage on the Kiffe Automotive site. That property is under the City's umbrella policy; however, if that structure is damaged in any way, the HRA would have to discuss whether or not the structure would be renovated or replaced. 10 HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 10 9. UPDATE ON RAPID OIL SITE: Mr. Burns stated he had handed out new information regarding the Rapid Oil site dated May 9, 1991. Ashland Oil and Ashland Oil's attorney, Mr. Brill, are asking that the Council schedule their request for a rezoning and special use permit. In view of the HRA's redevelopment goal for this site, the HRA needs to decide if the City should proceed with the rezoning and special use permitting process or should they proceed to begin condemnation proceedings that would allow the HRA to acquire the land for future redevelopment? Mr. Burns stated he would like to present some facts associated with the Rapid Oil site. A. Soil contamination & remediation 1. Design approval by the MPCA with modification 2. Potential cost of remediation is $500,000 over 10- 15 years 3. Information on remediation costs at other sites 4. Petro Fund availability - refund for up to 90% of costs for soil remediation and monitoring 5. Likelihood of recovery of our remediation costs through condemnation process B. Value of new Rapid Oil facility - $200,000- 300,000 (Mr. Burns stated Rapid Oil intends to build anew quick change oil facility on the site.) C. Economics of Winfield Project 1. Costs to HRA 2. Present value over 25 years = tax increment 3. Revenue from ft. = at $1.00 /sq. 4. Net value to 5. Cost to City 6. Net value to - $538,120 at 7.50 of available over 25 years = $501,576 sale of land ft. = 86,040 HRA = 49,496 of lost LGA = 81,144 HRA /City = ($31,648) Mr. Burns stated that if we increase their costs for the Winfield project by 50% or more, we are very unlikely to achieve a positive cash flow for a future redevelopment project on this site. Regarding additional impact on the future "gateway" project, preliminary estimates indicate a cost of $2 -3 million for residentially oriented "gateway" projects. Mr. Burns stated there are two issues the HRA should consider: HOUSING & REDEVELOPMENT AUTHORITY MEETING MAY 9, 1991 PAGE 11 A. Does the City and the HRA see sufficient public purpose for landbanking additional property? They have already acquired large sections of the southwest quadrant area. Additionally, they expect to negotiate a buy -out for the Lake Pointe project some time in 1991 or early 1992. Does the HRA and the City Council want to take on the cost and the political disadvantages of acquiring more land? B. Soil remediation (environmental issue). Assuming that the HRA votes yes on the landbanking issue, knowing the liabilities associated with soil remediation, are they better off not purchasing the property at this time? Landbanking Issue A. Pros 1. Acquisition of the property will help us qualify the west side of University Avenue as part of a future redevelopment district. 2. Acquisition of the property now will help us take advantage of lower real estate prices in a poor market and economy. - 3. There is considerable blight along both sides of University Avenue north of the interstate. Acquisition of the Rapid Oil site will help us address those blighted conditions earlier. 4. Acquisition of the Rapid Oil property will contribute to our overall goals of redeveloping the University Avenue Corridor. 5. Acquisition of the Rapid Oil property now will help us avoid future costs of acquiring Ashland Oil's reconstructed /brand new facility. (Estimated new value is $250,000 plus relocation costs.) B. Cons 1. Purchasing the Rapid Oil property now may be inconsistent with the HRA's position on purchasing the Suh property. 2. The HRA would incur holding costs: a. 7 1 /2a of $230,000 (acquisition price of existing Rapid oil) _ $17,250 HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 12 b. The City would lose taxes from the proposed reconstruction /brand new facility which are approximately $1,875. C. If we do not lease the property, it becomes tax exempt, and the City, school district, and County lose existing tax dollars (about $6,229). d. Since the HRA does not have a redevelopment project on line, its holding costs would incur for an indefinite period of time. 3. There are political implications and risks associated with owning additional land, and there are also additional responsibilities of managing and maintaining the one acre property. 4. If the HRA chooses not to purchase the Rapid Oil property, they could establish a TIF district in this area. As Rapid Oil constructs its new facility, the HRA could take advantage of the new taxes (about $12,000 per year) minus LGA deducts, that would be generated by the new tax value. LGA deducts would be very minimal (6 1/4% of 33% of $12,500). Soil Remediation (Environmental Issue) A. The initial cost of remediation should be reflected in reduced purchase price of the property at the time of condemnation. B. Any additional cost of remediation could be recovered through the Petro Fund. C. Actual cost of remediations and impact of remediation on willingness of lenders and investors are still unknown and not likely to be known. Mr. Burns stated staff is recommending the HRA proceed to acquire the Ashland Oil property through condemnation and that the process begin immediately. However, there are many unknowns. We do not know how much longer a recessionary economy will make any future development difficult. Although we are reasonably assured that most of the environmental costs will be covered, we do not know the extent or duration of these costs. Moreover, we do not know the impact that the presence of soil contamination will have on private sector willingness to invest in projects on this site. Mr. Burns stated staff suggests that the HRA separate the landbanking issue from the environmental issue. In doing so, they must first decide whether or not there is sufficient HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 13 public purpose served by landbanking the Ashland Oil property. The decision hinges on the value of eliminating University Avenue Corridor blight including automotive uses along University Avenue. Mr. Burns stated that regarding the environmental risk, if the HRA feels strongly about the redevelopment of the entrance to Fridley and sees the environmental risk as reasonable, then they should proceed to acquire the property. If they do not feel that redevelopment of the "gateway" area is or should be a high priority in this recessionary economy and that the environmental risk is unreasonable, then they should recommend that the Council proceed to act on the land use applications presented by Ashland Oil. Mr. Prairie stated he moderately disagreed with staff's recommendation to acquire the property through condemnation. A new Rapid Oil facility would improve this area, and the HRA can put their money in other areas where it is needed more. He is concerned about the amount of properties the HRA already owns. Ms. Schnabel stated she is also a little concerned about the properties the HRA owns, probably because there is not a lot of development going on and she did not like to see them tying up their resources on acquisitions like this when there are so many problems associated with the property which would become the HRA's responsibility. She stated the HRA's direction a year ago was to start stockpiling some dollars for future problems they might be faced with at Lake Pointe, and she did not see expending a lot of dollars on the Rapid Oil property as being consistent with that direction. Ms. Schnabel stated another reason for not looking favorably at acquiring the Rapid oil property ties in with the reasons for the recommendation made by staff to not acquire the Suh property. They have tried for many years to get the Winfield project off the ground, but it has failed. Compounding this are the soil problems which create another whole atmosphere for the HRA to not be interested in developing it. Maybe the HRA is better off letting this small parcel go and letting it be developed privately. Mr. Casserly stated this discussion about whether the HRA should get involved came up several times before. He stated there is now some legislation that will help HRA's deal with contaminated properties. So, putting aside the environmental concerns, the real issue becomes: What is the long term plan for this area and do automotive uses help or hinder that long term use? HOUSING & REDEVELOPMENT AUTHORITY MEETING. MAY 9, 1991 PAGE 14 10. Mr. Meyer stated if it costs $230,000 in condemnation, the courts could, in fact, award the HRA $1/2 million for soil remediation. If Rapid Oil expands, do they have to clean up the property? Mr. Burns stated that is correct. John Flora, Public Works Director, is recommending that the City insist that Rapid Oil at least complete the soil remediation part of the project before a building permit is issued. Mr. Herrick stated certainly someone is going to have to complete the process. He has not seen the MPCA plan, but he had been told it involves some soil removal and then a pumping process with some aeration device, and that pumping process would be a long term process. He thought it would be reasonable that before a building permit is issued that Rapid Oil would have to have at least commenced with the process which has been approved by the MPCA. Mr. Herrick stated the most important part of the legislation mentioned by Mr. Casserly is about the buyer not being the responsible party for soil remediation. The biggest problem he sees is not the liability for the cleanup, but the difficulty in selling the property. Mr. Casserly stated he is pretty positive that this legislation is going to pass. Mr. Herrick stated he is suggesting that the City Council set the public hearing date for June 17, and by that time they will know whether or not the legislation has passed. That will give the HRA one more opportunity to discuss this, and they can then make a decision at the June HRA meeting on whether or not to acquire the property. The HRA members were in agreement with this. RICE PLAZA UPDATE: Mr. Burns stated that regarding the agreement the HRA had with Terrie Mau, she has been unable to get a letter of credit that will cover her unpaid back lease amounts. Mr. Burns stated he has suggested to Jim Kordiak that they get some kind of lien or mortgage on her tanning equipment. Since that time, he has talked to Mr. Herrick, and Mr. Herrick and Mr. Kordiak will be discussing whether or not a chattel mortgage is possible as a substitute for a letter of credit. 11. UPDATE ON CUB FOODS PROJECT: Ms. Dacy stated that staff has asked Jim Casserly to contact the petitioner and get more detailed information on the r HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 15 prof orma. Perhaps the HRA could give staff some direction on how to proceed if the financial information is satisfactory. Mr. Casserly has written a memo dated April 15, 1991, regarding the creation of a new TIF district for the site. His memo outlines three options: 1. The Cub Food site qualifies independently as a 25 year redevelopment TIF district. 2. The Bob's Produce site qualifies independently as a 15 year Renewal and Renovation TIF district; it is unclear whether it qualifies individually as redevelopment. 3. Together the Cub Food site and Bob's Produce site qualify as a 25 year redevelopment TIF district. Ms. Dacy stated Mr. Casserly recommends that a single 25 year redevelopment TIF district be created for both the Cub Foods site and the Bob's Produce site across Osborne Road. He states that if redevelopment activity does not proceed on the Bob's Produce site within the next few years, the parcels involved in this property can be decertified from the district, thereby avoiding the penalties imposed under Minnesota Statutes. If development activity is proposed, then a separate TIF district could be created at that time. Mr. Prairie asked if they should include the parcels behind Cub Foods in the redevelopment TIF district. Ms. Dacy stated that is a good suggestion, and staff will explore that further. The HRA members concurred with staff's recommendation, to create a single 25 year redevelopment TIF district for both the Cub Foods property and the Bob's Produce site. 12. INFORMATION REGARDING BRICKNER DEVELOPMENT PROPOSAL: This was an information item only. 13. UPDATE ON FRIDLEY PLAZA OFFICE BUILDING: Ms. Dacy stated that at the last meeting, Mr. Commers inquired if there was any assistance given to the Fridley Plaza Office ownership in the last 2 -3 years. She stated staff found correspondence between Mr. Commers and Dave Newman, former HRA attorney. Apparently, this money that was in escrow with the trustees of the former owners was not available to the HRA. So, that matter was dismissed. HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 16 Ms. Dacy stated that for the June HRA meeting, staff is anticipating a letter from the new owner of the Fridley Plaza Office building, Dr. Michael Park, as to some type of forgiveness on the second mortgage. Ms. Dacy stated that Fridley Office Plaza owners have accepted the terms made by the HRA at the April meeting regarding the parking lot rental settlement and future parking lot rental payments. ADJOURNMENT: MOTION by Mr. Prairie, seconded by Mr. Meyer, to adjourn the meeting. Upon a voice vote, Vice - Chairperson Schnabel declared the May 9, 1991, Housing & Redevelopment Authority meeting adjourned at 10:05 p.m. Respectfully submitted, X" rynhLI Saba Recording Secretary Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley Memo to: Housing and Redevelopment Authority From: William W. Burns, City Manager ��b• Date: June 21, 1991 subject: Request from Dr. Michael Park for Forgiveness of second Mortgage Requirements and Revision of Property Taxes of Fridley Plaza Office Building We have received the attached two letters from Tony Krejci who is representing Dr. Michael Park, the new owner of the Fridley Plaza Office Building. I have addressed the request by sending the attached letter to Virgil Herrick. I have also requested other information from Leon Madsen and from our Finance Department. Although I had planned to be ready to present a recommendation to the HRA at their June 27 meeting, the press of requirements for putting the budget together and other matters have kept me from responding as quickly as I would have liked. I did, however, want to alert the HRA members to the issues that have been raised and to let you know that this is an upcoming issue at our next meeting. WWB /jb Attachments �I FRUDLEY OFFICE PLAZA May 7, 1991 City of Fridley C/O Ms. Barbara Dacy 6431 University Avenue N.E. Fridley, Minnesota 55432 RE: Settlement offer for Second Mortgage Dear Barb: This letter wql suflice as a settlement offer from Dr. Michael Park, Columbia Park Properties, to the City of Fridley (HRA), for a sum of Ten Thousand Dollars ($10,000.00) to settle the second mortgage debt that was placed on The Fridley Office Plaza by the former owner, Mr. Jack Brandt. It has been brought to my attention by Mr. Park and his legal council that If a settlement is not reached, then a final alternative would be to file a stipulated foreclosure, which would cancel out all liens and to Include the Second Mortgage. Mr. Park Is trying to sustain a good rapport with the city by trying to negotiate these problems with his own funds. Everyone Is aware, that these situations were caused by the former owner, Mr. Brandt. Mr. Park has paid $200,568.01 In back taxes(see enclosed exhibits), along with $18,000.00 In delinquent bills, not to include the $10,000.00 settlement to the HRA for the parking lot. Mr. Park has also spent In excess of $120,000.00 to Improve the building premises, and to show the City of Fridley that this property will be brought up to city standards. Please review the contents of this letter thoroughly, prior to the (HRA) City Council Meeting to be held on Thursday, June 13th ,1991 at 7:30. I will be there to represent Dr. Michael Park at that meeting. Again, I want to thank you for helping resolve the parking lot problem and if there is any further questions regarding this issue, please feel free to contac,me any time. Anthony J. Krejci *MWIEY OFFICE PLAZA, SUITE 300, 6401 AVE. NZ., FRIDLEY, MINNESOTA 55432 1.1 11A Y �1V-%5 1991 � p May 14, 1991 City of Fridley C/O Mr. Bill Burns; City Mgr. 6431 University Avenue N.E. Fridley, Minnesota 55432 RE: Tax Statement on Fridley Office Plaza ' Dear Bill: ._ At this time, I am enclosing pertinent information for your review in regards to the Fridley Office Plaza. Dr. Michael Park has requested that I proceed with the Abatement process and try to. recover partial 1989, 1990, first half of 1991 Taxes. Please note that Dr. Park paid $200,568.00 for back Taxes in 1989 — 1990 plus, Dr. Park paid an additional $39,783.08 on May 159 1991. What is hard to understand, is, Why are the Taxes for Fridley Office Plaza $79,566.16 per year at 30,700 square feet with parking lot lease as additional cost (only foot print ownership), when the Commerce B_ uilding is at $39,806.96 per year at 26,000 square feet, and they own land in addition. The Fridley Office Plaza in 1989 showed a net operating income of $226,000.00 or value of $2,260,000.00. For 1990 and 1991, an operating income of $82,920 or value of $829,200.00. When State Bond Company (Former Mortgage holder on the property) performed an MAI appraisal in November 1990, they came up with $850,000.00. That's $739,800.00 lower than the 1991 est net value. The numbers clearly show that if taxes were prorated according to value, Taxes would be cut in half for 1989 —1990, the first half of 1991, that would mean an abatement of $120,187.48 ($240,374.96 — 50%). We are not trying to be unreasonable, because as noted in my former letter to Barbara Dacy at the City of Fridley, we want to establish a good rapport with the city and all Creditors the former owner of the building left us. Please help in assisting us in recouping a reasonable amount of these paid taxes. Thank You! Office Plaza Mgmt. FRIDIEY OFFICE PLAZA, SUITE 3009 6401 UNIV RSM AVF N.E., FRIDI.'Y, A 55432 .2 O CITYOF FRIDLEY FRIDLEY MUNICIPAL CENTER . 6431 UNIVERSITY AVE. N.E. FRIDLEY, MN 55432 • (612) 571 -3450. FAX (612) 571 -1287 June 21, 1991 Virgil C. Herrick, City Attorney 205 Fridley Plaza Office Building 6401 University Avenue, N.E. Fridley, MN 55432 Dear Virgil: We have received two letters from Mr. Anthony J. Krejci who represents the new owners of the Fridley Plaza Office Building. In these letters Mr. Krejci is asking that we forgive all but $10,000 of the $40,000 second mortgage requirement for the Fridley Plaza Office Property. They are also asking that we recognize the current appraised value of the Fridley Plaza Office building and revise taxes consistent with its reduced value. I would like to ask that you provide answers to a number of legal questions that are raised by these two letters. My first concern are in regard to forgiveness of the second mortgage. As I understand our options we can do one of the following: A. Agree to accept a check for $10,000, B. Seek a continuation of our second mortgage provision through an additional subordination, or C. Insist upon the repayment of the $40,000. How accurate have I projected our options? What legal considerations should we give to evaluating any of our options? As part of evaluating our options I would also like to consider the legal precedent that we set by forgiving almost three - fourths of a second mortgage. I believe that our development agreement with the original owners of the Fridley Plaza Office Building provides the second mortgage. To what extent are we setting the precedent for forgiveness of second mortgages that may exist in other development agreements? 1.3 Letter to Virgil C. Herrick June 21, 1991 Page Two I would also ask that you evaluate the tax revision issue from the following perspectives: 1. Our development agreement with the original of the Fridley Plaza Office Building guarantees taxes at the rate of almost $73,000 per year. In your opinion is the minimum tax requirement binding on their successors and assigns? 2. If the minimum tax requirement is binding on successors and assigns, what is the strength of our legal opinion regarding the enforcement of the development agreement should the new owners challenge it? 3. What legal precedent are we establishing for other property owners who might be bound or currently feel bound by the minimum tax provisions of our development agreements? Does an agreement to renegotiate in one case require that we renegotiate in another? Finally, I would like you to opine as to whether or not you think the investment that Dr. Park has made in the Fridley Plaza Office building justifies a forgiving position on the part of the our HRA. To what extent do you feel, as the HRA I s attorney, that the new owner of the property has a valid argument? Thank you very much for looking at these items. I am hopeful that we will have your response in time for the July HRA meeting. Sincerely, 16�v William W. Burns City Manager WWB /jb Attachments 1.4 Community Development Department D HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: June 21, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Request for Tax Increment Financing Assistance at Former Cub Foods Site Project Request At the May 19, 1991 meeting, we reviewed with the HRA a request of $50,000 to assist in the redevelopment of the former Cub Foods site. Of this amount, $35,000 is to be a loan that is secured by a second mortgage. The remainder, $15,000, is to be considered a grant. As of June 20, 1991, the petitioners are now requesting $65,000 in assistance due to increased redevelopment costs. It is proposed that $50,000 would be secured by a second mortgage and $15,000 would be made in a grant. Proposal The Charles Smith estates owns the property and has retained Mike Hurley as its attorney and Bob Grootwasink as its broker to coordinate the remodeling of the existing building into three retail tenant spaces. At this point, the owners have a signed lease from Pet Food Warehouse for an August 1, 1991 occupancy. As of June 20, 1991, they have advised us that they have a potential lease with Stone Fabric for the second tenant space on the building. We have obtained balance sheets and profit and loss statements for Pet Food Warehouse for the last three years, as well as financial reports. Because of the late notification on Stone Fabric, we were not able to review their statements. Pet Food Warehouse is interested in Fridley because of its developed trade area and its proximity to the Northtown Shopping Mall. They believe that the University Avenue /Osborne Road location has a very high traffic count, and coupled with the Fridley demographics, they believe the market exists for another facility. Pet Food Warehouse currently has other locations in Roseville, Maplewood, and Richfield. K Former Cub Foods Site June 21, 1991 Page 2 Project Financin The petitioners have identified hard costs in the amount of $480,000. Project costs include exterior improvements to the parking lot, including landscaping, seal coating, re- striping, and interior improvements consisting of the roof repair, removal of asbestos - backed floor tiles, finishing the tenant spaces, and improving the interior HVAC systems, lighting and other necessary items. The petitioners received bids on the proposed work, and received bids for the roof and floor tile repair in excess of the originally anticipated costs. The removal of the floor tile was originally bid at $8,000, but after further checking, the bid is $38,000. The roof repair was originally bid at $28,000; however, that has been determined to be $58,000. Also adding to the cost of the project are the outdoor improvement requirements as imposed by the ordinance. A 20 foot setback must be created along Osborne Road and along the service drive. In the case of the strip along Osborne Road, the existing bituminous pavement needs to be removed and new landscaping installed. The property owners have secured a mortgage loan of $200,000 from Northeast State Bank, which will hold a first mortgage lien on the property. Secondly, the fee owners have made available $200,000 in personal guarantees. Third, the bank has required that the fee owners must deposit a certificate of deposit with the bank as additional collateral for the mortgage in the amount of $50,000. Therefore, the owner's interest in the property approximates $250,000. Given the additional cost of the roof and floor repair, Mike Hurley indicated that he was going to approach the bank for an additional $20,000. If that is approved, plus the additional $15,000 from the HRA, Hurley believes that the project can move forward. Casserly's original analysis was based on the original proposal of $50,000; $35,000 in a second mortgage and a $15,000 grant. His cash flow analysis indicated that the $50,000 could be recovered in approximately six years between loan repayments and tax increment receipts. It was estimated that the redevelopment would add an additional $200,000 in value to the property. At the current time, it is valued at about $832,000. The term on the second mortgage was a ten year loan at a 9% interest rate. Loan repayments would total $5,454. Now that the petitioner has requested an additional $15,000, the HRA may not be able to recover its investment until year eight or nine. Casserly will have a revised cash flow analysis available at Thursday's meeting. The "But -For" Test Hurley has indicated that if he can obtain the additional $20,000 2.1 Former Cub Foods Site June 21, 1991 Page 3 from Northeast State Bank, that is the maximum amount of financing that he can obtain. Given the poor condition of the existing building and the amount of improvements that need to be made, he indicates that TIF assistance is necessary for the project to move forward. He further reiterates that the building has been vacant for four years and is in a deteriorating condition. In terms of meeting the state requirements for the "but -for" test and to meet the City of Fridley's redevelopment goals, the proposed project will increase the taxable value of the property and will bring an existing substandard /blighted building into conformance with the building and zoning codes, and finally would provide additional employment opportunities. At this time, we only have employment estimates from Pet Food Warehouse. An additional 30 full and part time employees will be located at this facility. The remaining two tenant spaces will also provide employment opportunities. Recommendation Pending additional financial analysis, staff recommends that the HRA approve the request for assistance, and authorize staff to begin negotiations for a development contract. On a future agenda, the development contract will be presented to the HRA for review and approval. The HRA should be aware that the City Council upon establishing the public hearing for July 1, 1991 for creation of the district expressed several concerns about creating another district within the community. They asked staff to provide an overall plan for how many areas within the City would be included in redevelopment and tax increment districts. They have scheduled the public hearing for July 1, 1991, but at this point, they indicated that they were not willing to act on creating the district until July 22, 1991. BD /dn M -91 -452 2 ■2 I 1 APPLICATION FORM FOR TAX INCREMENT FINANCING NA Fee owners are as follows: Steven Hardy and Leanne Hardy, Business Name: Rent Gardner and Jerrill Lynn Gardner, and Kent Smith and Spring Address: coo 400 Nor hi-own Financing Pl awa, Inn crnnn RapiAga POW r = Rap ; ds, MN s Type (Partnership, etc.) : Fee ownership 55433 Representative: Michael P. Hurley Telephone: (612) 780 -8500 Name of Counsel: Michael F. Hurley Name and Telephone of Accountant: David A. Doerr List of Financial References: Name /Address /Contact /Telephone Available upon request Other Comments Pertinent to Your Application: Have You Ever Filed for Bankruptcy? Yes No x If Yes, provide details on separate sheet Have You Ever Defaulted on any Loan Commitment? Yes No x_ If Yes, provide details on separate sheet INFORMATION CONCERNING APPLICANT'S PROPOSED PROJECT Location of Proposed Development: (Attach a Drawing) 250 Osborne Road, Fridley, MN 55432 Nature of Proposed Business: Leaseout of building, proposed tenant is Pet Food Warehouse, who will occupy 60% of the building. 2.3 I I Principal Business or Product of the Company? _Tenant, sale of pt food supplies, wholesale in warehouse atmosphere Is the Proposed Project a New Facility' or Rehabilitation and /or Expansion of Existing Facility? Rehabilitation anoxpansion of-existing facility Industrial /Commercial /Residential: commercial What is the Present Employment of Your Firm: NA What is Your Estimate of Employment One Year After Completion of Project: NA What is Your Estimate of Employment Five Years After Completion of Project: NA Total Estimated Project Cost: $500,000 Total Estimated Construction Costs: $400,000 Potential Other Use(s) of Proposed Development: varied depending on other tenancies we can get in the property Will this Development Attract Other Related Industries: Yes x No How? site will be upgraded and more attractive to other tenants What Types? Unknown ?retail sales What is the Current Zoning Status of the Project Site? C -1 In Rezoning, will Zoning Variances or Conditional Use Permits be Required in Connection with the Project? Unable to determine at this point -2- 2.4 Is the Property Properly Subdivided for the Proposed Use? -- • - - • if sa1_a cif prQparty can hp a ng=lishM Has Site Approval been Obtained for this Project? No If So, When? By Planning Commission? By City Council? Have You Applied for Conventional Financing for the Project? Yes X No If Yes, Provide Details on Separate Sheet, "H. Information to Attach" If No, Why Not? INFORMATION TO ATTACH Please include: State Public Purpose Description of Project Schematic Drawing of Project Breakdown of Project Costs Amount of Subsidy Request See Exhibit A attached See Exhibit B attached $50,000.00 - $15,000 grant Construction Schedule As soon as financing is secured Legal Description - ( Include PIN's) 11- 30 -24 -22 -0024 Other Pertinent Information Deposit -3- 2.5 ADDENDUM TO TAR INCREMENT FINANCING APPLICATION FORM Additional Information Public Purpose: The purpose for the tax increment financing would be to upgrade this site so that it may become a viable generator of tax revenue for the city. The property is currently dilapitated and without help from the city in the form of financing, the project may sit dormant for a substantial period of time. Improvements to the property will increase the fair market value and assessed value of the property and the opening of new businesses in the property will result in additional jobs for the community. Description of Property: The entire front of the existing building on the site will be removed and renovated. The current entrance and exit to the building will be removed and renovated. A new brick facia will be placed on the building. The parking lot will be repaved and a new lighting system will be put in. The HVAC system and roof on the property will be repaired and /or replaced. Interior improvements will be completed to meet the needs of the specific tenants. 2 ■6 Casserly Molzahn & Associates, Inc. 215 South 11 th Street, Suite 200 • Minneapolis • Minnesota 55403 Office (612) 342 -2277 • Fax (612) 332 -4765 TO: City of W' Liam Lifarbara FROM: Mary E. James R DATE: June 3, M E M O R A N D U M Fridley Burns Dacy rc p` Molzahn Casserly 1991 RE: TIF District No. 11 Enclosed please find a cash flow analysis for proposed redevelopment TIF District #11. This analysis, which includes the Cub Foods and Bob's Produce sites, will be inserted into the TIF Plan for TIF District No. 11. It was prepared by combining the individual analyses, prepared previously, for each site. The assumptions, which are detailed on Page 3, include: 1. inflation of 0.000 %; 2. current tax capacity rate of 101.508; 3. administrative expenses of 5.000 %; 4.. taxable present value rate of 10.000% applied to the total available revenue; S. tax exempt present value rate of 8.000% applied to the local government aid deduction; and 6. pay 1991 tax capacities per Anoka County. Additional assumptions include: 1. Cub Foods Site —��K The estimated tax capacity of $9,200 is based on an additional estimated captured market value of $200,000. 2.7 2. Construction is assumed in 1991 with the first tax increment received in 1993. It is proposed that the Developer will repay the City $35,000 of the $50,000 assistance at 9.000% over a term of 10 years. Annual payments approximate $5,454. Bob's Produce Site The estimated tax capacity of $65,688 is based on two phases. The Phase I estimated tax capacity of $42,688 assumes estimated construction costs of $1,160,000 and an estimated market value of $928,000. Construction is assumed in 1991 with the first tax increment received in 1993. The Phase II estimated tax capacity of $23,000 assumes estimated construction costs of $625,000 and an estimated market value of $500,000. Construction is assumed in 1994 with the first tax increment received in 1996. Based on the above assumptions, $1,356,373 is generated in available tax increments, after administrative expenses are deducted, plus $54,537 in developer repayments for total estimated revenue of $1,410,910. This revenue stream translates into $465,414 in 1991 dollars based on a taxable present value rate. The total local government aid deduction for both projects is approximately $258,000. This amount translates into $63,128 in 1991 dollars based on a tax exempt present value rate. Also enclosed is a separate cash flow analysis of the Cub Food Site. 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GUZY BERNARD E. STEffEN RICHARD A. MERRILL ROBERT C. HYNES STEPHEN H. MUNSTENTEIGER RICHARD A. BEENS RONALD B. PETERSON DARRELL A. JENSEN JEFFREY S. JOHNSON RUSSELL H. CROWDER JON P. ERICKSON LAWRENCE R. JOHNSON DAVID A. COSSI THOMAS P. MALONE MICHAEL F. HURLEY June 7, 1991 THOMAS L.DONOVAN PAMELA M. HARRIS B S SHARON L. HALL KENNETH A. AMDAHL CHARLES M. SEYKORA Barna Guzy & Steffen Ltd. WILLIAM M. HANSEN Steffen, JOAN M. THIEMAN ATTORNEYS AT LAW DANIEL D. OANTER, JR. BEVERLY K. DODGE 400 Northtown Financial Plaza JOAN M. QUADE SCOTT M. LEPAK 200 Coon Rapids Boulevard STEVEN L. MACKEY Coon Rapids, MN 55433 -5894 OF COUNSEL PETER BARNA (612) 780 -8500 FAX (612) 780 -1777 NANCIE R. THEISSEN LAWRENCE M. NAWROCKI PATENT, COPYRIGHT AND TRADEMARK LAW Mr. James R. Casserly Casserly Molzahn & Associates, Inc. 215 South 11th Street Suite 200 Minneapolis, MN 55403 RE: Food Site /Osborne Crossing Dear Mr. Casserly: I am in receipt of your letter dated June 5, 1991. I apologize for any confusion regarding the amortization of the $200,000.00 mortgage from Northeast State Bank. The latest figures I gave you are accurate and the bank has agreed to those terms. I have talked to my clients regarding the HRA's.second position with its mortgage. My clients have no objection to this and will sign a subordination agreement at the time they close on their $200,000.00 mortgage. I will provide you with all of the information I have provided to the Northeast State Bank, copies of the appraisals, title insurance commitments, environmental assessments, project costs and any other information you may request. I have also asked Bob Grootwassink to immediately send you the 1988 and 1989 income statements for Pet Food Warehouse. I would like to take this opportunity to thank you for your time and energy on this project. You have been extremely helpful. SUhael rs y yo M F. Hurl MFH /lj cc: Kent Gardnem nbia Heights Office Anoka Office Bob Grooty ftV] Venue NE Anoka Professitmal Building inneapo is, N 55421 403 Jackson Street (612) 788.1644 Anoka, MN 55303 (612) 427.6300 FROM SARNA `UZY LAW MPLS. 6. 3.1991 14:32 P.2 Ill)BERT A. t;ULY BERNA1111 1; :TRFFP.N RICIIARDA. MERRILL ROBiIR'F C. I IYNts %TEPNr.11J M. MUNSItNTF.NILK RICHARD A. BMINS RONALD D. 1'11TERSOA: DARRELL A. )ENSE•N JEFFREY S. )Ol INSON RUSSELL 11. CROWDER JON r. LRICKSON L.AAIUNt_:P. R. 1011NEW214 DAVID A. CORtiI TI10MAS P. MAL0NE MICHAEL F. I{U1tLEY June 3, 1991 'DD GS Barna, Guzy & Steffen, Ltd. ATTORNUS AT LAW 400 Northtown Financial Plaza 200 C wn Rapids Boulevard C'A)on Rapids, MN 55433.5814 (612) 780-8500 FAX (612) 780 -1777 Mr. James Casserly Casserly Molzahn & Associates, Iris. 215 South 11th Street, Suite 200 Minneapolis, MN 55403 RE: Osborne crossing T140),IAS L. DONOVAN P,�116L�A M. MAR."A JMP,ON L. HALL. KENNPTH A. AMLIAHL CHARLES M. SINKORA WILLIAM Nt HANSi :N JC14N M. THMMAN DANIEL D. UANM. JR. UVERLY K. I'X)WE JOAN M. Q ►JAPE ,4-a i M. UPAK STEVEN L. MArKIiY tiF COUNSEL PETr;R BARNA NANCIE R. THEISSEN LAWRENCE M. NAWRt?CKI PATENT, C OPYR1 111T AND TRAUEMARK LAW Dear Mr. Casserly: On behalf of the fee owners of the Osborne Crossing property, I have secured a commitment from Northeast state Bank for a mortgage loan with the following particulars: 1. Loan amount - $200,000.00 2. Security - First mortgage lien on the property. 3. Interest rate - 12% 4. Amortization period - five year fully amortized. S. Additional security - fee owners must deposit a certificate of deposit with the bank as additional collateral in the amount of $50,000.00; fee owners must give personal guaranties for the $200,000.00 note. I hope the above information is acceptable. If you need any further information regarding the financing proposed by Northeast State Bank, please feel free to contact me. You have also inquired as to the status of any other encumbrances against the Osborne Crossing site. Presently, there exists no debts against the property other than outstanding special assessments. If you have any questions, please feel free to contact me. Sincerely yours, �- Mich F. Hurley WHIM Calumbls Hrlgha Office Anoka Offler 3`989 Central Avenue NL Anoka rinfeniunal RuillnC ptlnatapnh%, MN 55421 403 JkKkum Strrtet (612) 799.1644 . AnukP, kIN 55301 (61I) 477A1D0 T B MEIS May 13, 1991 Mr. Mike Hurley Bauna Cuxy & Steffen 200 Coon Rapids Blvd. Coon Rapids, HN 55433 Dear Mike: WEIS ASSET MANAGEMENT, INC. 3601 Mlnnesdo Drho MUneoMb. Minnesota 55435 telephone: 612 - 8314060 Fox: 6*831 -3132 Enclosed is the most current balance sheet on Pet Food Warehouse I picked it up on 5-10 -91. He states the Fridley store will employee 30 people full and part time At the store with some additional support employees at the home office. Sales pro forma. He predicts the store should see a profit at about the 9 month period with sales of $3,000,000 annually by the end of the second year. Years 3, 4, and 5 they believe the sales shall increase at least 5% per year. Why Fridley? A. Fridley has a developed trade area. B. Close to North Town Center C. University /Osborne location has the highest traffic count in the City of Fridley with the exception of 694. D. The trade area demographics look good. E. This location within the city is part of their expansion plans and not too close to an existing Petfood Warehouse. Mike, I hope this information is what you need. Sincerely, Weis Asset Management, Inc. r rte' 184 /r..4rotwa 4ds ink REG /vs Enclosure 2.14 ROBERT A. GUZY BERNARD E. STEFFEN RICHARD A. MERRILL ROBERT C. HYNES STEPHEN H. MUNSTENTEIGER RICHARD A. BEENS RONALD B. PETERSON DARRELL A.JENSEN JEFFREY S. JOHNSON RUSSELL H. CROWDER JON P. ERICKSON LAWRENCE R. JOHNSON DAVID A. OOSSI THOMAS P. MALONE MICHAEL F. HURLEY Ms. Barbara Dacy Fridley Community Development Director Fridley City Hall 6431 University Avenue N.E. Fridley, MN 55432 RE: Proposed Tax Increment Financing Application /250 Osborne Road Dear Ms. Dacy: Thank you for taking time out of your busy schedule to meet with myself and the brokers of the transaction, Bob Grootwassink and Richard Walquist. As I indicated to you during our discussion, I represent the fee owners of the property referred to above. The purpose of this letter is to ask that you informally approach the Housing and Redevelopment Authority of Fridley to investigate the Possibility of including the property referred to above within a tax increment financing district. If your response is positive, the fee owners of the property will make a formal application for funds from tax increment financing. To fully understand the complexities of this project, I feel it is important for you to understand the historical background behind this property. The building on the property was originally constructed to house a grocery store. Cub Foods fka Fairway Foods, Inc. entered into a long term (30 year) lease for the property in 1968. After . occupying the property for approximately 12 years, Cub Foods decided to vacate the premises and move their operation to another site. After they vacated the property Cub Foods attempted to relet the property. Various small tenants such as Stone Fabrics, American Furniture Outlet, etc. occupied the property from time to time. All of these tenants were on a short term basis. Cub Foods had a below market lease rental. They felt originally that they could sublet the property for the remaining term of the 30 year lease, meet their lease obligations and still make money. However, they were unable to attract any significant tenants. Cub Foods then attempted to sell the property as a way of getting out from under the remainder of their 30 year lease. Of course, any sale of the o have to be by and through a purchase agreement with thetfeeould Columbia Heights Office Anoka Office 3989 Central Avenue NE Anoka Professional Building Minneapolis, MN 55421 403 Jackum Street . (612) 7138.1644 Anoka, MN 55303 (612) 427-6300 THOMAS{L. DONOV'AN B%JO PAMELA M. HARRIS SHARON L. HALL KENNETH A. AMDAHL Barna, Guzy & Steffen Ltd. CHARLES M. SEYKORA WILLIAM M. JOAN M. TIIIEMAN EMAN ATTORNEYS AT LAW DANIEL D. CANTER, )R. BEVERLY K.IX)D(,E 400 Nortl)town Financial Plaza JOAN M. QUADS 200 Coon Rapids Boulevard SCOTT L. Coon Rapids, MN 55433 STEVEN MACKEY OF COUNSEL PETER BARNA (612) 780 -8500 FAX (612) 780 -1777 NANCIE R. THEISSEN March 28, 19 91 LAWRENCE ?61. NAWR PATENT, (( )PYRIGHTOCkl AND TRADEMARK LAW Ms. Barbara Dacy Fridley Community Development Director Fridley City Hall 6431 University Avenue N.E. Fridley, MN 55432 RE: Proposed Tax Increment Financing Application /250 Osborne Road Dear Ms. Dacy: Thank you for taking time out of your busy schedule to meet with myself and the brokers of the transaction, Bob Grootwassink and Richard Walquist. As I indicated to you during our discussion, I represent the fee owners of the property referred to above. The purpose of this letter is to ask that you informally approach the Housing and Redevelopment Authority of Fridley to investigate the Possibility of including the property referred to above within a tax increment financing district. If your response is positive, the fee owners of the property will make a formal application for funds from tax increment financing. To fully understand the complexities of this project, I feel it is important for you to understand the historical background behind this property. The building on the property was originally constructed to house a grocery store. Cub Foods fka Fairway Foods, Inc. entered into a long term (30 year) lease for the property in 1968. After . occupying the property for approximately 12 years, Cub Foods decided to vacate the premises and move their operation to another site. After they vacated the property Cub Foods attempted to relet the property. Various small tenants such as Stone Fabrics, American Furniture Outlet, etc. occupied the property from time to time. All of these tenants were on a short term basis. Cub Foods had a below market lease rental. They felt originally that they could sublet the property for the remaining term of the 30 year lease, meet their lease obligations and still make money. However, they were unable to attract any significant tenants. Cub Foods then attempted to sell the property as a way of getting out from under the remainder of their 30 year lease. Of course, any sale of the o have to be by and through a purchase agreement with thetfeeould Columbia Heights Office Anoka Office 3989 Central Avenue NE Anoka Professional Building Minneapolis, MN 55421 403 Jackum Street . (612) 7138.1644 Anoka, MN 55303 (612) 427-6300 March 28, 1991 Page 2 owners of the property agreeing to the sale. Cub Foods was unsuccessful in locating a purchaser for the property. In approximately 1987, the fee owners of the property were approached by a prospective purchaser, Southam Development. In order to enter into the Purchase Agreement, it was determined that the fee owners needed to either terminate or buy out the remaining lease term of Cub. The lease interest of Cub in the property was ultimately terminated. The purchase agreement with the Canadian developers ( Southam Development) fell through. They were unable to secure financing. Subsequent to Southam Development, the sellers entered into a purchase agreement with JSW Properties. JSW Properties backed out of the purchase agreement after they were unable to secure their anchor tenant. Subsequent to JSW Properties, Linville & Associates, Inc. entered into a purchase agreement with the seller. Linville & Associates Inc. were unable to secure their anchor and adequate financing. They canceled their interest in the purchase agreement. All of the purchase agreements above dealt with some sort of seller financing in order to get this transaction accomplished. The purchase price for this property was reduced dramatically to accomplish a sale. To date, the sellers have been unsuccessful in entering into and completing any purchase agreement for this property. In light of today's market, it is the seller's feeling that the property in its present condition is not saleable. In light of my client's past experience in trying to sell the property, ate " was determned that -some action needed to be -taken in- order -to stop the cash flow drain from the property until the real- estate market recovers. My clients are paying real estate taxes of $48,000.00 plus utilities and other maintenance expenses without any income of the property. Since we have been unable to sell the property, the sellers have determined that they need to lease the property to stop the cash_drain__and recognize some return. One anchor tenant, Pet Food__Warehquse, has expressed an interest -in leasing approximately 60% of the building space.. However, in order to lease out this space substantial exterior, heating, air conditioning and tenant improvements be completed. -My- clients estimate that the cost to rehab this particular parcel will exceed $400,000.00 I enclose for your review a copy of a preliminary statement as to costs which will be incurred by sellers for exterior and interior improvements. The purpose of this letter is to request that the City of Fridley Housing and Redevelopment Authority consider tax increment financing to offset some of the seller's cost for completing exterior site improvements to the project,. As the property currently stands, there is no tax revenue other than real estate taxes being generated by this project. An improvement to the property by way of site renovation and bringing tenants into the project will generate increased tax dollars and create new jobs 2.16 March 28, 1991 Page 3 and other tax revenue for the City. Therefore, the sellers of this property would request that the City of Fridley, Housing and Redevelopment Authority consider the prospect of offering $50,000.00 in tax increment financing for this project. The City has indicated that one of the conditions for site approval of this project will be the creating of a green space area between the parking lot and the roadway and revitalizing the parking lot. By way of background, the property originally did have green space between the parking lot and the street. Approximately six or seven years ago the County condemned part of the property to increase the right of way for the highway. The County reimbursed my clients approximately $6,000.00 - $7,000.00 for the taking. The present cost to create the green space will be approximately $40,000.00. The project will also loose parking area as a result of the creation of the green space. In addition, we expect the new exterior lighting system for the project will cost approximately $8,000.00 and parking lot improvement project including servicing or striping will cost approximately $20,000.00. In addition to these improvements we expect the exterior facelift of the project including removal and remodeling of some of the facia of the building and replacing sidewalks to be approximately $24,000.60 -., Therefore, you can see that the total project cost for just the exterior improvements of this project to exceed $92,000.00. In light of the history of the taking of the green space on this project, my clients would like to request that the HRA consider a $15,000.00 grant to go towards the cost of re- establishing the green area. My clients were paid approximately $7,000 for the taking of all of this green area. Now at the request of the City, they will be required to re- establish this green area. My clients feel strongly that some costs associated with the establishment of this green area should be shared by Fridley. My clients are now going through the process of trying to locate financing to cover the costs for all improvements to this project. This is an extremely difficult task The fee owners of this property are not. wealthy individuals. Their only security for the property is the project itself. Therefore, the ability of the bank to finance the total amount of the project improvements will be questionable. Therefore, my clients would like to request from the City of Fridley Housing and Redevelopment Authority, $35,000.00 in tax increment financing to help offset some of the project costs. The structuring of the repayment of this $35,000.00 should not be an issue as to the sellers. This project will enhance both the neighborhood, increase tax revenues and create jobs for the community. I would therefore ask that you informally speak to the Housing and Redevelopment 2.17 March 28, 1991 Page 4 Authority to see if the creation of tax increment financing district for this particular project would be acceptable. If so, I will commence the application process. For your information I have included some information regarding the Pet Food Warehouse who will be the anchor tenant for this project. If you need any further information regarding this project, please feel free to contact me. sincerely, Michael F. Hurley MFH:lj Enclosures RealesMetters\MDacy 2.18 Community Development Department D HOUSING AND REDEVELOPMENT ATJTHOItITY City of Fridley DATE: June 21, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Consider Approval of!Additonal Parcels to -the -Redevelopment Plan Creation of Tax Increment District #11, Pending the HRA's determination for assistance to remodel the former Cub Foods site, the HRA also needs to approve the addition of the Bob Schroer and former Cub Foods property to the redevelopment project area and to authorize creation of Tax Increment District #11� The attached pages identified as 1 -16 and 1 -17 represent the additional pages in the redevelopment plan discussing the proposed expenditures of the tax increment district. The pages identified by 12 -1 through 12 -3 and the accompanying exhibits represent the tax increment plan for the new District #11. Adding these properties into the redevelopment plan is consistent with the objectives of the plan and state statute: improving /modernizing blighted buildings, increasing tax value, and providing additional employment opportunities. As you recall, the district will be a 25 year redevelopment district. The attached memorandum from Jim Casserly and Mary Molzahn describes the cash flow analysis for- the district. Casserly will be present at Thursday's meeting to review the cash flow analysis should the HRA have specific questions. We have obtained preliminary information from Bob Schroer to make assumptions as to the amount of value that would be created on his property. Bob Schroer has indicated that he wants to redevelop his property in two phases. For the first phase, he wants to construct a 23,000 s g produce., second square foot building to sell his roduce.. phase would consist of another 12,000 square foot building for additional tenant space. A detailed site plan has not been reviewed by our office at this time; however, we believed it was enough information to give to Casserly to base his projections. The previous memo on the Cub Foods site describes in detail the features of that project. 3 Tax Increment District #11 June 21, 1991 Page 2 Remodeling the existing Cub Foods building and constructing new buildings on the Bob Schroer property meets the objective of removing blighted buildings. Casserly's analysis points out that redevelopment of both parcels will generate estimated revenue of $1,410,910. This revenue is translated into $465,414 in 1991 dollars based on a taxable present value rate. While specific numbers are not known about the estimated number of employees that would be generated at the redeveloped Bob Schroer property, we do know that the Pet Food Warehouse will employ at least 30 full and part time individuals. Pet Food Warehouse represents 1/3 of the remodeled Cub Foods building. While this proposal will add additional area in a tax increment district, it should be noted that three TIF districts will be decertified in the next five years. They are the Johnson Skywood district (1992), Paschke district (1992), and the Shorewood district (1995). Therefore, the tax increment from all of these districts will be distributed to all taxing jurisdictions, in addition to the original tax value already being collected. The HRA at the last meeting inquired about adding additional properties along Commerce Lane into the district. Candidate parcels would be the former Kentucky Fried Chicken parcel and possibly the former Brothen Meat building at 7501 Commerce Lane. Given that we have not received any assistance requests for these parcels, it is more prudent to add these parcels to the redevelopment project area only instead of adding them in the TIF district. It would also be preferable to add these parcels after an overall inventory is made regarding additional parcels eligible for redevelopment. Other priorities may arise out of the housing study, for example. Recommendation Should the HRA proceed to authorize assistance for the former Cub Foods site, staff recommends the HRA approve the attached resolution to approve the modification to the redevelopment plan and approve the creation of Tax Increment District #11 as depicted in the proposed attachments by Casserly. BD /dn M -91 -451 3.1 HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY COUNTY OF ANOKA STATE OF MINNESOTA RESOLUTION NO. A RESOLUTION MODIFYING THE REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO. 1 AND MODIFYING THE TAX INCREMENT FINANCING PLANS FOR TAX INCREMENT FINANCING DISTRICTS NO. 1 THROUGH NO. 10 TO REFLECT INCREASED PROJECT COSTS AND INCREASED GEOGRAPHIC AREA WITHIN REDEVELOPMENT PROJECT NO. 1; AND ESTABLISHING PROPOSED TAX INCREMENT FINANCING DISTRICT NO. 11 AND APPROVING AND ADOPTING THE PROPOSED TAX INCREMENT'FINANCING PLAN RELATING THERETO. BE IT RESOLVED by the Board of Commissioners (the "Commissioners ") of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority "), as follows: Section 1. Recitals. 1.01. It has been proposed that the Authority modify, approve and adopt the Modified Redevelopment Plan for Redevelopment Project No. 1 to reflect increased project costs and increased geographic area, pursuant to and in accordance with Minnesota Statutes, Sections 469.001 to 469.047, inclusive, as amended and supplemented from time to time. 1.02. It has been further proposed that the Authority modify, approve and adopt the Modified Tax Increment Financing Plans for Tax Increment Financing Districts No. 1 through No. 10 to reflect increased project costs and increased geographic area within Redevelopment Project No. 1, pursuant to Minnesota Statutes, Section 469.174 through 469.179, inclusive, as amended and supplemented from time to time. 1.03. It has been further proposed approve the establishment of proposed Tax District No. 11 and approve and adopt the Financing Plan relating thereto pursuant with Minnesota Statutes, Section 469.174 as amended and supplemented from time to 3.2 that the Authority Increment Financing proposed Tax Increment to and in accordance to 469.179, inclusive, time. 1.04. The Authority has investigated the facts and has caused to be prepared with respect thereto, a Modified Redevelopment Plan for Redevelopment Project No. 1 reflecting increased project costs and increased geographic area; Modified Tax Increment Financing Plans for Tax Increment Financing Districts No. 1 through No. 10 reflecting increased project costs and increased geographic area within Redevelopment Project No. 1; and a proposed Tax Increment Financing Plan for proposed Tax Increment Financing District No. 11, defining more precisely the property to be included, the public costs to be incurred and other matters relating thereto. 1.05. The Authority has performed all actions required by law to be performed prior to the modification, approval and adoption of the Modified Redevelopment Plan for Redevelopment Project No. 1 and the Modified Tax Increment Financing Plans for Tax Increment Financing Districts No. 1 through No. 10, and prior to the establishment of proposed Tax Increment Financing District No. 11 and the approval and adoption of the proposed Tax Increment Financing Plan relating thereto. 1.06. The Authority hereby determines that it is necessary and in the best interests of the City and the Authority at this time to modify, approve and adopt the Modified Redevelopment Plan for Redevelopment Project No. 1 to reflect increased project costs and increased geographic area; to modify, approve and adopt the Modified Tax Increment Financing Plans for Tax Increment Financing Districts No. 1 through No. 10 to reflect increased project costs and increased geographic area within Redevelopment Project No. 1; and to establish proposed Tax Increment Financing District No. 11 and to approve and adopt the proposed Tax Increment Financing Plan relating thereto. Section 2. Findings. 2.01. The Authority hereby finds that the assistance to be provided through the adoption and the implementation of the Modified Redevelopment Plan, Modified Tax Increment Financing Plans and proposed Tax Increment Financing Plan are necessary to assure the development and redevelopment of Redevelopment Project No. 1. 2.02. The Authority hereby finds that the Modified Redevelopment Plan, Modified Tax Increment Financing Plans and proposed Tax Increment Financing Plan conform to the general plan for the development and redevelopment of the City as a whole. 2 3.3 2.03. The Authority finds that the Modified Redevelopment Plan, Modified Tax Increment Financing Plans and proposed Tax Increment Financing Plan afford maximum opportunity consistent with the sound needs of the City as a whole for the development and redevelopment of Redevelopment Project No. 1. Section 3. Modification, Approval and Adoption of the Modified Redevelopment Plan for Redevelopment Project No. 1. 3.01. The modification of the Modified Redevelopment Plan for Redevelopment Project No. 1 reflecting increased project costs and increased geographic area and the approval and adoption of the Modified Redevelopment Plan relating thereto are hereby approved and adopted by the Commissioners of the Authority and are forwarded to the Fridley City Council for public hearing, review and approval. Section 4. Modification. Approval and Adoption of the Modified Tax Increment Financing Plans for Tax Increment Financing Districts No. 1 through No. 10. 4.01. The modification of the Modified Tax Increment Financing Plans for Tax Increment Financing Districts No. 1 through No. 10 reflecting increased project costs and increased geographic area within Redevelopment Project No. 1 and the approval and adoption of the Modified Tax Increment Financing Plans relating thereto are hereby approved and adopted by the Commissioners of the Authority and are forwarded to the Fridley City Council for public hearing, review and approval. Section 5. Approval of the Establishment of Proposed Tax Increment Financing District No. 11 and the Approval and Adoption of the Proposed Tax Increment Financing Plan Relating Thereto. 5.01. The establishment of proposed Tax Increment Financing District No. 11 within Redevelopment Project No. 1 and the approval and adoption of the proposed Tax Increment Financing Plan relating thereto are hereby approved and adopted by the Commissioners of the Authority and are forwarded to the Fridley City Council for public hearing, review and approval. Section 6. Filing of Plans. 6.01. Upon approval and adoption of the Redevelopment Plan, the Modified Tax Increment and the proposed Tax Increment Financing Plan "Plans "), the Authority shall cause said Plans the Commissioner of Revenue. 3 3.4 Modi f ied Financing Plans (collectively the to be filed with Adopted by the Board of Commissioners of the Authority this 27th day of June, 1991. ATTEST: Executive Director Chairman CERTIFICATION I, William W. Burns, Executive Director of the Housing and Redevelopment Authority in and for the City of Fridley, County of Anoka, Minnesota, hereby certify that the foregoing is a true and correct copy of Resolution No. passed by the Authority on the 27th day of June, 1991. William W. Burns, Executive Director 4 3.5 Casserly Molzahn & Associates, Inc. 215 South 11 th Street, Suite 200 • Minneapolis • Minnesota 55403 Office (612) 342 -2277 • Fax (612) 332 -4765 TO: City of W' liam arbara FROM: Mary E. James R DATE: June 3, M E M O R A N D U M Fridley Burns Dacy Molzahn Casserly 1991 RE: TIF District No. 11 Enclosed please find a cash flow analysis for proposed redevelopment TIF District #11. This analysis, which includes the Cub Foods and Bob's Produce sites, will be inserted into the TIF Plan for TIF District No. 11. It was prepared by combining the individual analyses, prepared previously, for each site. The assumptions, which are detailed on Page 3, include: 1. inflation of 0.000 %; 2. current tax capacity rate of 101.508; 3. administrative expenses of 5.000 %; 4. taxable present value rate of 10.000% applied to the total available revenue; 5. tax exempt present value rate of 8.000% applied to the local government aid deduction; and 6. pay 1991 tax capacities per Anoka County. Additional assumptions include: 1. Cub Foods Site The estimated tax capacity of $9,200 is based on an additional estimated captured market value of $200,000. 3.6 Construction is assumed in 1991 with the first tax increment received in 1993. It is proposed that the Developer will repay the City $35,000 of the $50,000 assistance at 9.000% over a term of 10 years. Annual payments approximate $5,454. 2. Bob's Produce Site The estimated tax capacity of $65,688 is based on two phases. The Phase I estimated tax capacity of $42,688 assumes estimated construction costs of $1,160,000 and an estimated market value of $928,000. Construction is assumed in 1991 with the first tax increment received in 1993. The Phase II estimated tax capacity of $23,000 assumes estimated construction costs of $625,000 and an estimated market value of $500,000. Construction is assumed in 1994 with the first tax increment received in 1996. Based on the above assumptions, $1,356,373 is generated in available tax increments, after administrative expenses are deducted, plus $54,537 in developer repayments for total estimated revenue of $1,410,910. This revenue stream translates into $465,414 in 1991 dollars based on a taxable present value rate. The total local government aid deduction for both projects is approximately $258,000. This amount translates into $63,128 in 1991 dollars based on a tax exempt present value rate. Also enclosed is a separate cash flow analysis of the Cub Food Site. The differences between this analysis and previous one is a higher interest rate on the City's loan and a reduced class rate to reflect recent Statutory changes. The $50,000 HRA investment will be recovered in approximately six years between loan repayments and tax increment receipts. If you have any questions, please give a call. MEM,JRC /db encls 3.7 w v d v H W W }f W J O ce W LL. O U N. M O W Q .r ey tY w tl LL 1-- O O O O O N N N MN n W W O N A M W M W O N d m N n N M O Co 1 U 1 r N M d 111 t0 n 01 O N M 1A n 01 O N 1 O v Z O J QQQZ N N in m 1 J I 1 Q J O O O O O O O O O O O O O� ONN �pb M t0 N In In n M N d M n W N ^ n I I Q ZC W h /v1 tL� O1 Od1 N d 1n0 10 n 1 r r r r r r r r r r r r Z 1 v ul Q QQ N 1 I O O O O O O O O O O O O d d 01 O� M M n n d d O O 10 N N CO It It O O 01 I'! 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After an initial analysis of the two sites in question, the.following conclusions have been made: 1. The Cub Food site qualifies independently as a 25 year Redevelopment TIF District. 2. The Bob's Produce site qualifies independently as a 15 year Renewal and Renovation TIF District; it is unclear whether it qualifies individually as Redevelopment. 3. Together the Cub Food site and Bob's Produce site qualify as a 25 year Redevelopment TIF District. The attached summarizes the advantages and disadvantages for creating a single TIF District encompassing the Cub Food and Bob's Produce sites versus creating two individual TIF Districts. 3.11 SINGLE TIF DISTRICT - _ADVANTAGES 1. It is simpler in terms of time, energy and expense to create a single TIF District: one modification to the Redevelopment Plan, one Tax Increment Financing Plan and one public hearing is required. 2. The City avoids future Legislative restrictions imposed on the creation of TIF Districts or the use of tax increments. 3. The pooling restrictions require 75% of the revenue derived from tax increments to be spent within the TIF District in which they were generated. In a single TIF District, the pooling problem is eliminated. 4. Both sites would have a 25 year term in which to maximize tax increment receipts. 5. The Local Government Aids deduction would be reduced. A Redevelopment TIF District phases in the LGA deductions at a reduced rate. The Renewal and Renovation District has a 100% phase in of LGA deductions by year 13 versus year 20 for the Redevelopment District. SINGLE TIF DISTRICT - DISADVANTAGES 1. If redevelopment of the Bob's Produce site does not occur within the next several years, the tax increment revenue may be limited. It may make sense to create a separate TIF District when the redevelopment is imminent. 2. The Five Year Limitation requires that all revenues generated within a TIF District be paid to a third party, pledged to bonds, pledged to binding third party contracts, or used for reimbursement of costs paid within five years of the TIF District's certification. If the redevelopment activity occurs after five years, the tax increment generated after the fifth year must be returned to the taxing jurisdictions. SEPARATE TIF DISTRICTS - ADVANTAGES 1. Tax increment revenues can be maximized if TIF Districts are created as projects are proposed. 2. The Five Year Limitation is easier to comply with because the redevelopment activities of each TIF District are treated individually. 3.12 MULTIPLE TIF DISTRICTS - DISADVANTAGES 1. A modification of the Development Program, the preparation of a tax increment financing plan and the holding of a public hearing is required for each TIF District created. 2. The City is at risk in terms of Legislative amendments to the Tax Increment Financing Act. 3. Under the pooling restrictions only 25% of the tax increment generated is available for use in other TIF Districts. If pooling is necessary, the amount of tax increment which may be spent in a different TIF District is greatly limited. 4. The Bob's Produce site will probably be limited to a 15 year district with the resulting increase in LGA deductions and a substantial decrease in available increment. RECOMMENDATION Based on the advantages listed above for a single TIF District, it is our recommendation that the City consider the creation of a 25 year Redevelopment TIF District including both the Cub Food and Bob's Produce sites. If redevelopment activity does not proceed on the Bob's Produce site within the next few years, the three parcels included in this site may be decertified from the TIF District. By decertifying these parcels in the fourth year following the TIF District's certification, the restrictions and penalties imposed under the Five Year Limitation can be avoided. These parcels may then be included in a separate TIF District when development activity becomes imminent. There are no negative legal consequences in creating a single district and it will allow the HRA to better manage the redevelopment of the Bob's produce site if it so chooses. MEM,JRC /db 3.13 Public Trails /Recreational Improvements /Open Space 325,000 Parking 450,000 Street Lighting 200,000 Demolition 500,000 Relocation 500,000 Architectural /Engineering Fees 500,000 Administration Fees 400.000 Total $11,078,000 Maximum Estimated Total Bonded Indebtedness* $14,401,400 *This amount includes capitalized interest in an amount sufficient to pay interest on the bonds from the date of issue until the date of collection of sufficient tax increment revenues to meet scheduled interest payments when due. AS MODIFIED FEBRUARY 26, 1990 TAX INCREMENT FINANCING DISTRICT NO. 10 (NORTHCO PHASE III) Soils Correction $ 70,000 Administration Fees 4,967 Intersection Improvements to University Avenue Frontage Road and 73rd Avenue 20.000 Total $ 94,967 Maximum Total Estimated Bonded Indebtedness* $ 94,967 *This amount includes capitalized interest in an amount sufficient to pay interest on the bonds from the date of issue until the date of collection of sufficient tax increment revenues to meet scheduled interest payments when due. AS MODIFIED JULY 1, 1991 TAX INCREMENT FINANCING DISTRICT NO. 11 (UNIVERSITY /OSBORNE SITE) Acquisition Demolition Site Cleanup /Preparation and Utility Relocation Street Modification Ingress /Egress 1 - 16 3.14 $ 200,000 40,000 200,000 60,000 Professional Fees 15,000 Administrative Fees 72.000 Total $ 587,000 Maximum Estimated Total Bonded Indebtedness* $ 737,000 *This amount includes capitalized interest in an amount sufficient to pay interest on the bonds from the date of issue until the date of collection of sufficient tax increment revenues to meet scheduled interest payments when due. Subsection 1.10. Public Improvements and Facilities Within Redevelopment Project No 1 Publicly financed improvements within Redevelopment Project No. 1 include but are not limited to: a. The acquisition and sale and /or lease of the parcels identified in Subsection 1.7. hereof; b. Soil corrections, including excavation and backfill; C. Installation and /or upgrading of utilities and other public improvements; d. Development of proper traffic circulation patterns and improved ingress and egress on public and private roadways; e. Funding of the Reserve Program; and f. Other authorized uses as provided by State law. (The following amendment of Subsection 1.10 to the Modified Redevelopment Plan was approved November 18, 1985.) Additional public improvement costs to be incurred within Redevelopment Project No. 1 and to be financed by tax increments derived from all tax increment financing districts within Redevelopment Project No. 1 are estimated to be: Land Acquisition Streets, Intersections, Walkways and Lighting Parking Facilities Soil Correction, Drainage and Landscaping 1 - 17 3.15 $3,500,000 4,100,000 1,500,000 2,300,000 SECTION XII TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 11 (UNIVERSITY /OSBORNE) Subsection 12.1. Statement of Objectives. See Section I, Subsection 1.5. Statement of Objectives. Subsection 12.2. Modified Redevelopment Plan. See Section I, Subsections 1.2. through 1.15. Subsection 12.3. Parcels to be Included. The boundaries of Tax Increment Financing District No. 11 are described on the attached Exhibit XII -A and illustrated on Exhibit XII -B. Subsection 12.4. Parcels in Acquisition. The Authority may publicly acquire and reconvey any or all of the parcels in Tax Increment Financing District No. 11 identified on the attached Exhibit XII -A. The following are conditions under which properties not designated to be acquired may be acquired at a future date: (1) The City may acquire property by gift, dedication, condemnation or direct purchase from willing sellers in order to achieve the objectives of the Tax Increment Financing Plan; and (2) Such acquisition will be undertaken only when there is assurance of funding to finance the acquisition and related costs. Subsection 12.5. Development Activity for which Contracts have been Signed. As of the date of adoption of the Tax Increment Financing Plan, the City intends to enter into a Development Agreement with an investment group incuding the following: Steven Hardy, Leanne Hardy, Kent Gardner, Jerrill Lynn Gardner, Kent Smith and Spring Smith, for the rehabilitation and expansion of an existing facility to provide 34,200 square feet of commercial space with a total construction cost estimated at $400,000, and anticipated construction completion in 1991. Subsection 12.6. Specific Development Expected to Occur. At this time it is anticipated that a facility providing 34,200 square feet of commercial space will be rehabilitated and constructed. Additional commercial development is also anticipated and is expected to include an additional 35,000 square feet with construction costs in excess of $1,700,000. 12 - 1 3.16 Subsection 12.7. Prior shall, after due and diliger certification to the County enlargement with a listing c Financing District No. 11 fc issued during the eighteen I approval of the Tax Incremer The county Auditor shall inc Tax Increment Financing Dist each improvement for which t said listing does not accoml notice, the absence of such Auditor that no building pei months prior to the Authorit Financing Plan. Planned Improvements. The Authority t search, accompany its request for Auditor or its notice of district f all properties within Tax Increment r which building permits have been 18) months immediately preceding t Financing Plan by the Authority. rease the original tax capacity of rict No. 11 by the tax capacity of he building permit was issued. If any the aforementioned request or listing shall indicate to the County mits were issued in the eighteen (18) y I s approval of the Tax Increment Subsection 12.8. Fisc 1 Disparities. The Authority hereby elects the method of tax increment computation set forth in Minnesota Statutes, Section 469.177, Subdivision 3, clause (a) if and when commercial /industrial development occurs with Tax Increment Financing District No. 11. Subsection 12.9. Esti ated Public Improvement Costs. The estimated costs associated ith Redevelopment Project No. 1 are listed in Section I, Subsec ions 1.9 and 1.10. Subsection 12.10. Estin It is anticipated that $500,C incurred with respect to this No. 1. The City also wishes or part of the activities lis and 1.10. as modified July 1, Financing District No. 11 as become available. ated Amount of Bonded Indebtedness. 00 of bonded indebtedness could be portion of Redevelopment Project to reserve the right to pay for all ted in Section I, Subsections 1.9. 1991 relating to Tax Increment tax increments are generated and Subsection 12.11. Sources of Revenue. The costs outlined in Section I, Subsection 1.9. will be financed through the annual collection of tax increments. Subsection 12.12. Esti Capacities. The tax capacit Increment Financing District by the Commissioner of Reven January 2, 1991, is estimate fated Original and Captured Tax ► of all taxable property in Tax No. 11, as most recently certified ie of the State of Minnesota on i to be $70,035. 12 - 2 3.17 The estimated captured tax capacity of Tax Increment Financing District No. 11 upon completion of the proposed improvements on January 2, 1995 is estimated to be $129,601. Subsection 12.13. Tax Capacity Rate. The current total tax capacity rate is 101.508. Subsection 12.14. Tax Increment. Tax increment has been calculated at approximately $60,464 upon completion of the improvements assuming a static tax capacity rate and a valuation increase of zero percent (0.0 %) compounded annually. Subsection 12.15. Type of Tax Increment Financing District. Tax Increment Financing District No. 11 is, pursuant to Minnesota Statutes, Section 469.174, Subdivision 12, a Redevelopment District. Subsection 12.16. Duration of Tax Increment Financing District. The duration of Tax Increment Financing District No. 11 is expected to be twenty -five (25) years from receipt of the first tax increment. The date of receipt of the first tax increment is estimated to be July, 1993. Thus, it is estimated that Tax Increment Financing District No. 11, including any modifications for subsequent phases or other changes, would terminate in the year 2018. Subsection 12.17. Estimated Impact on Other Taxing Jurisdictions. The estimated impact on other taxing jurisdictions assumes construction would have occurred without the creation of Tax Increment Financing District No. 11. If the construction is a result of tax increment financing, the impact is $0 to other entities. Notwithstanding the fact that the fiscal impact on the other taxing jurisdictions is $0 due to the fact that the financing would not have occurred without the assistance of the City, the attached Exhibit XII -E reflects the estimated impact of Tax Increment Financing District No. 11 if the "but for" test was not met. Subsection 12.18. Modification of District and/or Tax Increment Financing 1991, no modifications to Tax Increment or the Tax Increment Financing Plan the date being the date of initial approval the City Council. 12 - 3 3.18 Tax Increment Financinq Plan. As of July 1, Financing District No. 11 cefore has been made, said and adoption thereof by BOUNDARIES OF TAX AS ORIGINALLY :IBIT XII -A :NT FINANCING DISTRICT NO. 11 ITY /OSBORNE ADOPTED JULY 1, 1991 P.I.N. 11- 0 -24 -22 -0024 11- 0 -24 -22 -0020 11- 0 -24 -22 -0018 02- 0 -24 -33 -0026 XII -A -1 .19 EXHIBIT XII —B BOUNDARY MAP OF TAX INCREMENT FINANCING DISTRICT NO. 11 ej �• % r.. + 1 A / I l l01 - 03 ))oZ 'rr' y 723 J 1 ® e I;I 7�op 1 i co ■ •- .% ..r - r .r, ST •RANCH ; %!•.' EAST RANCH v ® ESTATES I F1Rsr�>> >•� �► TA 76 2a �, THIR ADD. ADD / j • ? '.; q -z - *AFs 65c cl) (50) ! i • i ti 0) , ( /F30J /psi TV (150) � 't40OJ 3 � 1 / 27 •' 1 _ TAX INCREMENT DISTRICT I , 7) (250) I I (: 350) ' I 5 (8� (300) > a 09/0) I o 6 ., I�•:. ter•:! ; so I w w I �I` 7yrl -9 °J I [ I ' W a 0. H � U En � I � W Ha x m O ..t Ha x w O w �xl� � U! M U W F- N W lz Q2 Nm O z w W Z I Ix N H H uj W iE J In O W OC O W o� K o. N ? 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Existing buildings do not meet city codes and there are several environmental concerns, including the removal of asbestos materials. One building on the site has been vacant for a number of years. In addition to providing job opportunities and increased retail traffic, the rehabilitation of this building will provide an additional $200,000 in market value to the City's tax base. Other buildings in the Tax Increment Financing District will be replaced with larger structures providing additional employment and market valuation. Due to the high costs of public improvements including demolition, site acquisition, clean up and preparation, the project would not proceed in the foreseeable future without public assistance. XI -D -1 3.24 11, Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley TO: Housing and Redevelopment Authority FROM: William W. Burns, City Manager � DATE: June 21, 1991 SUBJECT: Rapid Oil Site At the May HRA meeting, we discussed the disposition of a Rapid Oil site inconclusively. If you recall, it was decided that we would postpone a final decision on whether or not to condemn and acquire the Rapid Oil site as we waited the outcome of the 1991 state legislative session. The'legislative session is now over. The legislature did pass legislation that would indemnify cities that condemn contaminated property. I also believe that the legislation indemnifies those to whom the future contaminated property might be sold. In order to continue this discussion I have included a copy of the memorandum that I wrote to Council for their June 17 meeting as well as the copy of the legislation on the contamination issue that has been forwarded to me by Jim Casserly. Additionally, I have provided a copy of the outline of my presentation that I made at the May HRA meeting. Finally, I have included a copy of the appraisal that was provided to me by Dennis Taylor of Sheneahon- Goodlund- Taylor, Inc. Staff recommendation at the last HRA meeting was that we acquire this site by condemnation and include it in a future University Avenue gateway redevelopment project. Our feeling has been that although banking large quantities of land in an uncertain economy is not necessarily desirable, I feel that a decision to allow Ashland Oil to build another quick change oil facility on the Rapid Oil site could make future acquisition of this site more than twice as expensive as it currently is. Doubling the cost of the Rapid Oil acquisition will make financial justification for redeveloping the entire "gateway" area very difficult. I also think that with the assurances that we now have received regarding the indemnification from the costs of soil cleanup and remediation that the HRA's risk in acquiring that property has been substantially reduced. Memo to HRA June 21, 1991 Page Two The City Council is currently considering an application for rezoning the Rapid Oil site as well as considering a special use permit that has been requested by Ashland oil. The rezoning and special use permit will make it possible for Ashland Oil to build their new quick change facility. Council has heard the Rapid Oil site of the issue, they have not yet given a clear indication of their position. My feeling is that Council is genuinely interested in hearing the HRA's advice before they act on the land use applications. Thank you for your reconsideration of this matter WWB /jb 4.1 CITYOF FRIDLEY TO: FROM: DATE: MEMORANDUM Municipal Center 6431 University Avenue N.E. Fridley, MN 55432 (612) 571 -3450 Office of the City Manager The Honorable Mayor and City Council William W. Burns, City Manager June 17, 1991 SUBJECT: Rapid Oil Issue William W. Burns At tonight's council meeting you are going to be asked to conduct a public hearing regarding a rezoning of the property located at 5701 University Avenue. The property is owned by Ashland Oil Company and is currently used for a Rapid Oil site. Ultimately, you will also asked to approve a special use permit related to the construction of a new Rapid Oil facility. At the last HRA meeting I presented the attached information and recommended that the HRA proceed to condemn the Rapid Oil property by condemnation. By condemnation we avoid the cost of buying out a newly constructed Rapid Oil facility. In the process we help to hold down the costs of an already marginal University Avenue gateway redevelopment project. At the time of our last HRA meeting the legislature was still debating a bill that would indemnify municipalities and other agencies of the State that choose to condemn property from the costs of removal and remedial actions necessary because of existing environmental contamination. Since our HRA meeting that law has passed (See attached copy.). We also know that should we voluntarily take on the responsibility of cleanup and remediation we would, in all likelihood, be reimbursed by Petro Fund for ninety percent of the cleanup and remediation costs. Although there are many issues here and although my recommendation is made with less than perfect confidence, I would ask that we not close the door on the Rapid Oil condemnation through our public hearing process tonight. I would also ask that I have an opportunity to discuss in a more informal setting the recommendations of the HRA which should be forthcoming after their June 27 meeting. Thanks for your consideration. WWB /jb 4.2 C� N O � O aCIO � o 0 O � � CA o o A a� ° o ° o o cu o ,� o O C Cd C) O03 !„O �" O .4 o Cd con Cd �, p U O c,0 0 0 d °�' ° °o c o o 0 O o R '—' •� O O o o O O o m-4 CD � C/1 • • • • • 64 N N or— mo F- W I- G4 4.3 o .� O Cd O � 40 O U CIS 3 0 Z 0 a Ni" ,s U `O 01 M U U 00 6q F � II II II II II Q., o >0 , O CL +O O _ U U ( �' �, 0 O U r� O • O U U —+ U U U �'' U ♦' N U U O Z U Z +C4 Ed Ed C4--4 U v � U c U W 3 U 4.4 m 0 a� U Cd b�4 O N U 'U U cd O U N � U Ed O o . � O O .->, � 0 0 O cq3 C13 bo .� O c13 N 9 p U o 4 0 Cd ca j '� D O 0 cdq E O ;.-1 0 a) O U 70 N d. Cd V W "'"� N '� c> v 0 0 b,q Cd Cn r j 4) 0 U — � U 0 z ,� � . � cd o ,� 0 ? � o 70 u o -� �U� U � • - N �-- �— M d- to O 4.5 M i•a O O � = O ct O � � U d' bA • U p N • b�4 M U O • �C U N N cis N os c;s � � CA is cd 0 o O O cd 4-+ O N j (4 O ca 0 w U O cd co M O • r., co 0 0 0 9 1-,4 0�6q 6q a4C -4 Z II 0 0 0 N M d- O V 4.6 0 C) O cO � O 44 CIO � U N O O • ° C 0(U . .cd C O U �O O U U Cd Q _ N Cd CIO ' cd o '� �u w c O El p 0 U O •'-+ -� ' '� U �-, '� O U O O Cl) N O �O 0 O vj O O O CZ C: u O Cd Cd o o m oCd cd a) C W U P� U j 4.7 Lno r SHENEHON- GwDLUND TAYLOR, INC. 6155 DUUTM SnU= NMRNEAPOM MN 65422 6=6"9M May 3, 1991 Ms. Barbara Dacy Community Development Director City of Fridley 6431 University Avenue Northeast Fridley, Minnesota 55432 RE: MARKET VALUE APPRAISAL OF RAPID OIL CHANGE SITE AT 577H AND UNIVERSITY AVENUE NORTHFAST, FRIDLEY* MINNESOTA Dear Ns. Dacy: We have completed an appraisal of the above captioned property as you requested. We certify that we have personally inspected the property. To the best of our knowledge and belief the statements of fact contained in this report and upon which the opinions herein are based are true and correct, subject to the assumptions and limiting conditions explained in the report. Employment in and compensation for making this appraisal are in no way contingent upon the value reported, and we certify that we have no interest, either present or contemplated, in the subject property. We have no personal interest or bias with respect to the subject matter of the appraisal report or the parties involved. This appraisal assignment was not based on a minimum valuation, a specific valuation or approval of a loan. This appraisal report identifies all of the limiting conditions (imposed by the terms of our assignment or by the undersigned) affecting the analyses, opinions, and conclusions contained in this report. The value indication in this appraisal assumes there is no soil, groundwater or environmental contamination in /on the subject property. An environmental assessment of the property has not been conducted to your appraiser's knowledge. Should the subject property be contaminated, the market value indicated in this appraisal is subject to change. The appraisers are aware of contamination but they are not environmental experts and therefore recommend an inspection by environmental companies if there are concerns. REAL ESTATE APPRAISERS • ANALYSTS Ms. Barbara Dacy May 3, 1991 Page 2 No one other than the undersigned prepared the analysis, opinions, or conclusions concerning real estate that are set forth in the attached appraisal report. In our opinion, the subject property had a most probable market value of fee simple interest on April 1, 1991 of: Two HUNDRED THIRTr,THOUSAND DOLLARS $230,000 This appraisal consists of three separate legal descriptions and assumes tha the site size is 41,180 square feet. The value conclusion of this report is our estimate based on accepted real estate appraisal practice and has been made in conformity with and is subject to the requirements of the Code of Ethics and Standards of Professional Conduct of the Appraisal Institute. If you have any questions or comments after reading the appraisal report, please contact our firm. Very truly yours /Us N-GO DLUND- TAYIDR, . E. Taylor, Mk, SRPA 4.9 Casserly Molzahn & Associates, Inc. 215 South 11 th Street, Suite 200 • Minneapolis • Minnesota 55403 Office (612) 342 -2277 • Fax (612) 332 -4765 M E M O R A N D U M TO: City of Fridley Lxlliam Burns Barbara Dacy FROM: James R. Casserly DATE: May 30, 1991 RE: Enclosed Legislation Enclosed are copies of legislation which have passed the legislature and which we expect the governor to sign. These should help us in our resolution of the Rapid Oil site. JRC /db encl 4.10 v '�.. �.JA:- �,�.:.p, .s �:� _3.; '�?''S"a. "�+i'L4'j. ,�_ .. ,f... —! v ?Tr Ye f. � �7' •.tep'.s. -_. °:.. HF236 UNOFFICIAL ENGROSSMENT [REVISOR ] CA UEH0236 -1-- unoff is sal engrossMent 1 A bill for an act 2 relating to eminent domain; allowing entry on %o land 3 for environmental testing before beginning eminent 4 domain proceedings; providing for findings regarding 5 the cost of removal and remedial actions relating to 6 environmental contamination; amending Minnesota 7 Statutes 1990, sections 117.041; and 117:085. 8 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 9 Section 1. Minnesota Statutes 1990, section 117.041, is 10 amended to read: 11 117.041 [ENTRY FOR SURVEYS SURVEY OR ENVIRONMENTAL 12 TESTING.] 13 Subdivision 1. [SURVEYS.] For the purpose of making 14 surveys and examinations relative to any proceedings under this 15 chapter, it shall be lawful to enter upon any land, doing no 16 unnecessary damage. 17 Subd. 2. [ENVIRONMENTAL TESTING BEFORE EMINENT DOMAIN 18 PROCEEDINGS.] ( ) A state agency by order of the commissioner or 19 a political subdivision by resolution may enter. property for 20 purposes of investigation, monitoring, testing, surveying, 21 boring, or other similar activities necessary or appropriate to 22 identify the existence and extent of a release or threat of 23 release of a hazardous substance, pollutant, or contaminant if: 24 (1) the state agency or political subdivision has reason to 25 believe that acquisition of the property may be required 26 pursuant to eminent domain proceedings; 1 4.11 - .. .. ... ',i-x ' J.;r s .: =/.'- J'o.�.. rl�ji:icAt�7�!��:: k'«•k: > � :waa��a:,.+... HF236 UNOFFICIAL ENGROSSMENT (REVISOR ] CA. QEH0236 -1 1 (2) the state agency or political subdivisioni has'reason to " :f'- 2 believe that a hazardous substance, pollutant, or contaminant is 3 present on the property or the release of a hazardous substance, 4 pollutant, or contaminant may have occurred or is likely to 5 occur on the property; and 6 (3) entry on the property for environmental testing is 7 rationally related to health, safety, or welfare concerns of the 8 state agency or political subdivision in connection with 9 possible eminent domain proceedings. 10 (b) At least ten days before entering the property, the 11 state agency or political subdivision must serve notice on the 12 property owner requesting permission to enter the property, 13 stating the approximate time and purpose of the entry, and 14 giving the owner the option of refusing entry. The notice shall 15 also give the owner the option of requesting an equal amount of 16 any sample or portion taken from the property and a copy of any 17 data obtained or report issued. If the property owner refuses 18 to consent to the entry; the state agency or political 19 subdivision must apply for a court order authorizing the entry 20 and the removal of any sample or portion from the property, 21 giving notice of the court order to the property owner. The 22 court shall issue an order if the state agency or political 23 subdivision meets the standards in paragraph (a). Notices under 24 this paragraph must be served in the same manneras a summons in 25 a civil action. 26 (c) The state agency or political subdivision must do no 27 unnecessary damage to the property and shall restore the 28 property to substantially the same condition in which it was 29 found. If the state agency or political subdivision removes a 30 sample or portion of the property for investigation, monitoring, 31 or testing, or obtains any data or issues any report, it must 32 give the property owner an'equal amount of the sample or portion 33 and a copy of any-data or report, if requested by the property 34 owner, and must permit the property owner to perform independent 35 investigation, monitoring, or testing of the sample or portion. 36 (d) The results of testing performed under paragraph (a) 2 4.12 HF236 UNOFFICIAL ENGROSSMENT [REVISOR ] CA UEH0236 -1 1 must be included in any environmental assessment worksheet or 2 environmental impact statement that the state agency or 3 political subdivision is required to prepare under chapter 116D 4 Sec. 2. Minnesota Statutes 1990, section 117.085, is 5 amended to read: 6 117.085 [COMMISSIONERS, POWERS, DUTIES.] 7 The commissioners, having been duly sworn and qualified 8 according to law, shall meet as directed by the order of 9 appointment and hear the allegations and proofs of all persons 10 interested touching the matters to them committed. They may 11 adjourn from time to time and from place to place within the 12 county, giving oral notice to those present of the time and 13 place of their next meeting. All testimony taken by them shall 14 be given publicly, under oath, and in their presence. They 15 shall view the premises, and any of them may subpoena witnesses, 16 which shall be served as subpoenas in civil actions are served, 17 and at the cost of the parties applying therefor. If deemed 18 necessary, they may require the petitioner or owner to furnish 19 for their use maps, plats, and other information which the 20 petitioner or owner may have showing the nature, character, and 21 extent of the proposed undertaking and the situation of lands 22 desired therefor. In proper cases they may reserve to the owner 23 a right of way or other privilege in or over the land taken, or 24 attach reasonable conditions to such taking in addition to the 25 damages given or they may make an alternative award, conditioned 26 upon the granting or withholding of the right specified. 27 Without unreasonable delay they shall make a separate assessment 28 and award of the damages which in their judgment will result to 29 each of the owners of the land by reason of such taking and 30 report the same to the court. The commissioners, in all such 31 proceedings, may in their discretion allow and show separately 32 in addition to the award of damages, reasonable appraisal fees 33 not to exceed a total of $500. Upon request of an owner the 34 commissioners shall show in their report the amount of the award 35 of damages which is to reimburse the owner and tenant or lessee - 36 for the value of the land taken, and the amount of the award of - 3 4.13 HF236 UNOFFICIAL ENGROSSMENT [REVISOR ] CA UEH0236 -1 1 damages, if any, which is to reimburse the owner and tenant or 2 lessee for damages to the remainder involved, whether or not 3 described in the petition. The amounts awarded to each person / 4 shall also be shown separately. The commissioners shall, if (/ es- r,,•%ATOo 5 requested by any. party, make an express finding of the 6 cost of removal and remedial actions that will be necessary on 7 the taken property because of existing environmental 8 contamination. �..� o� 4.14. 4 SF822 THIRD ENGROSSMENT [REVISOR ] JC 50822 -3 Version as sent to Governor 1 A bill for an act 2 relating to the environment; clarifying that certain 3 persons who own or have the capacity to influence 4 operation of property are not responsible persons 5 under the environmental response and liability act 6 solely because of ownership or the capacity to 7 influence operation; amending Minnesota Statutes 1990, 8 section 1158.03, by adding subdivisions. 9 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 10 Section 1. Minnesota Statutes 1990, section 115B.03, is 11 amended by adding a subdivision to read: 12 Subd. 5. [EMINENT DOMAIN.] (a) The state, an agency of the 13 state, or a Political subdivision that acquires property through 14 exercise of the power of eminent domain, or through negotiated 15 purchase after filing a petition for the taking of the property 16 through eminent domain, or adopting a redevelopment or 17 development plan under sections 469.001 to 469.134 describing 18 the property and stating its intended use and the necessity of 19 its taking is not a responsible person under this section solely 20 as a result of the acquisition of the property. 21 (b) A person who acquires property from the state, an 22 agency of the state, or a political subdivision, is not a 23 responsible person under this section solely as a result of the 24 acquisition of property if the property was acquired by the 25 state, agency, or political subdivision through exercise of the 26 power of eminent domain or by negotiated purchase after filing a 27 petition for the taking of the property through eminent domain 1 SF822 THIRD ENGROSSMENT (REVISOR ) JC 50822 -3 1 or adopting a redevelopment or development plan under sections 2 469.001 to 469.134 describing the property and stating its 3 intended use and the necessity of its taking. 4 Sec. 2. Minnesota Statutes 1990, section 115B.03, is 5 amended by adding a subdivision to read: 6 Subd. 6. (MORTGAGES.) (a) A mortgagee is not a responsible 7 person under this section solely because the mortgagee becomes 8 an owner of real property through foreclosure of the mortgage or 9 by receipt of the deed to the mortgaged property in lieu of 10 foreclosure. 11 (b) A mortgagee of real property where a facility is 12 located or a holder of a security interest in facility assets or 13 inventory is not an operator of the facility for the purpose of 14 this section solely because the mortgagee or holder has a 15 capacity to influence the operation of the facility to protect 16 its security interest in the real property or assets. 17 Sec. 3. Minnesota Statutes 1990, section 1158.03, is 18 amended by adding a subdivision to read: 19 Subd. 7. (CONTRACT FOR DEED VENDORS.) A contract for deed 20 vendor who is otherwise not a responsible party for a release or 21 a threatened release of a hazardous substance from a facility is 22 not a responsible person under this section solely as a result 23 of a termination of the contract for deed under section 559.21. 2 4.16 G Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: June 21, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Consideration of Rice Plaza Items To follow is a list of issues regarding the. Rice Plaza Shopping Center. Some issues need discussion and action by the HRA, and some are for the HRA's information. 1. Jim Kordiak received a letter from My Sister's Closet requesting the City of Fridley HRA reduce the rent by 1/2 during the Mississippi Street improvement project. There is another memo in the agenda regarding the status of the Mississippi Street project; however, the length of the project is estimated at ten weeks. I checked with the management of Holly Center to determine whether they would be offering a similar arrangement to their tenants. Gary Jackson.advised me that they have not done that as a leasing company in the past, and they do not anticipate doing it for the tenants at Holly Center unless there is a "hardship" request from a particular tenant. We will be inviting all of the tenants of Rice Plaza and the Holly Shopping Centers to an informational meeting on the Mississippi Street project on July 8, 1991. - This issue is sure to be asked at the meeting. The HRA should discuss whether or not such a reduction would be applicable during the construction period. After speaking with Kordiak and Jackson, it is my recommendation that the HRA not authorize a rent reduction at this time. 2. Norge Village, the dry cleaner business, has left the Rice Plaza property. Kordiak has advised us that there is a lot of specialized equipment that does remain. Kordiak wanted to warn us that the HRA may have to assume the cost for removing some of the appliances. The estimated cost at this time is $2,500; however, Kordiak is working with Norge Village to remove all items. Rice Plaza Items June 21, 1991 Page 2 3. Children's Charm will also be leaving the building as of June 30, 1991. Rordiak reported that this tenant space has water damage on the floor at the rear portion of the building. Our Public Works Department is currently investigating it. BD /dn M -91 -450 5.1 My Sister's Closet 244 Mississippi St. NE Fridley, Minnesota 55432 67 Lh - /'/A v- ---e- -a. 'k a 0 RICE PLAZA 1991 RENT 03-Jun-91 5.3 NORGE VILLAGE 1,100.00 1,239.56 1,188.61 1,243.61 2,192.06 6,963.84 METZ BAKING 702.98 755.63 755.63 737.21 1,537.58 4,489.03 CHILDREN CHARM 890.02 712.46 851.16 661.90 3,115.54 HONG KONG KITCHEN 752.97 805.63 787.21 810.31 2,115.64 5,271.76 MY SISTER'S CLOSET 793.74 855.63 1,177.52 1,169.94 3,996.83 CINNAMON SKIN TAN 800.00 1,000.00 1,500.00 1,200.00 4,500.00 RAPIT PRINTING 897.14 889.00 965.22 1,022.61 2,134.921 5,908.89 TOTAL 3,453.09 6,173.58 6,264.76 7,342.42 11,012.041 34,245.89 3,453.09 9,626.67 15,891.43 23,233.85 34,245.891 34,245.89 YEAR TO DATE 5.3 r� Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: June 21, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Consider Approval of Removal of Tree Stumps at Lake Pointe Attached is a memorandum from Mark Winson recommending that the HRA remove 50 tree stumps at Lake Pointe. Winson points out that these tree stumps are from trees that died last. year and were not replaced because the warranty had run out on the original landscape contract. Winson received a quote from Green Masters, the contractor responsible for maintaining Lake Pointe, in the amount of $2,325.00, or $46.50 per stump. Recommendation Stump removal is not part of the typical maintenance contract. that the HRA has with Green Masters; however, as you may recall, we saved a significant amount of money when we went out to bid for the Lake Pointe maintenance agreements. We had originally budgeted for $36,500, and the awarded contract to Green Masters was for $27,680. Therefore, the $2,325 can easily be assimilated into the "Services Contracted" Non - Professional budget. Staff recommends that the HRA authorize the Public Works Department to notify Green Masters Industries to remove 50 tree stumps at $46.50 per tree. BD /dn M -91 -448 Engineering Sewer Water Parks Streets Maintenance MEMORANDUM TO: Barbara Dacy, Community Development Director PW91 -162 FROM: Mark A. Winson, Asst. Public Works Director /q/ttJ DATE: June 3, 1991 SUBJECT: Tree stumps at Lake Pointe There are numerous tree stumps at the Lake pointe sites from trees that have died and were not replaced because they were out of warranty. Our 1991 Lake Pointe Maintenance Contractor has pointed out to Jon Thompson that this is a potential injury situation to pedestrians and bikeriders using the pathways within Lake Pointe. Because there is a potential for injury which could be a liability to the City and also the stumps detract from the appearance of the site, I ask that you have the HRA consider approving funds to remove the stumps. Jon Thompson is in the process of obtaining a price from our.1991 Lake Pointe Maintenance Contractor for this stump removal. MAW /ts 6.1 • lndustries,�u. Professional Landscape Management T� - ? OkLA� -r/v o .� TN � 1 WATERFORD PARK - 505 HIGHWAY 169 NORTH - SUITE 775 - PLYMOUTH, MN 55441 - (612) 591 -5858 - FAX (612) 591 -6185 June 4, 1991 City of Fridley 6431 University Ave. N.E: Fridley, Minnesota 55432 Attn: John Thompson Dear John: We have reviewed the removal costs for the stumps as requested. It appears there are approximately 50 stumps to be removed at the park. The cost for: - Removal - Disposal - Fill hole with black dirt - - Seed will be $ 46.50 per tree. If the city would like us to proceed with the project, please give us a call. cer;Eecutive H. Ran Toth Accoun HRT /pjl 6.2 MEMBER ASSOCIATED LANDSCAPE CONTRACTORS OF AMERICA DATES 06/12!11 CITY OF FRIDLEY - HRA PACE 1 PROGRAM PONE( CLEC.K REGISTER CHECK RUN BATCH # :000` 002 HRA VENDOR DISC. DESCRIPTION INV # PO /INV # SEB # PCNT 2129 # * *# CHECK - PREPAID CAW169 GI•tEENMklqml INC LAKE POINT MAINT PRLJI 218 004 -01 **" TOTAL VENDOR 2130 CHECK( PREPAID x N00026 NATURAL GREEN, INC. SPRING START -LJ' MAINTENAN 42400 -01 AMOUNT ACCT NLH°FJ.,R A4QYC0.0000 :3,TbE,. DR455 -20200 3,7`�6.`uq CR455- 1410.1 S 3,756.`f8 A4G2YI0.(Ki00 a TOTAL VENDOR H- P. 1.863.42 IR47,,20M, 1,86,142 CR455 -10100 � t „363.42 2131 *x-*§ CHECK- PIUAIR * * ** CHECK PREPAID F00023 0=69 GREENMASTERS, INC A402XN0.0000 MAY PM)NAL MAINTENANCE LAKE POINTE E 00425-41 A462YFO.0000 3,756.57 IR45-20200 1,ERV /EXK, -NSE 00427 -07 3,155.57 CR455 -10100 TOTAL VENDOR 3, 756.`7 213 CHECK- PRE,FRAID H *rr SERV /EXPENSE 00421• -09 C00044 CA: U.Y LAW CFFICE SERV/EXPENSE 00427 -01 MAY LEGAL SERVICES (10426-x1 A4G2XE0.00KKI S2.x0 DR450•-20200 11.65 CR4C+(I -10100 ,140[{000.(u1CK) 92.00 CR450 -10100 &JNE LEGAL SERVICES 00426 -04 .14WXHa.0WO 3.50 DR450 -20200 2:'.50 CR450 -10100 MAY LEGAL. SERVICES 00426 -02 A4(,I°XZ4.0000 180.x0 DR4`5 -20200 150.00 CR455- 10100 --lLQf LEGAL SERVICES 00426 -09 A4G2Y2°0.0000 202.50 Ir't455 -24200 2'02.50 CR45-10100 lloc- LEGAL SERVICES 00426 -06 A4C°YWI.0000 292.50 DR45/- 20..'x0 250 CR4`7- 13100 MAY LEGAL SERVICES 00426 -03 W11030. W00 1,035.00 DR460 -20200 1,035.00 CR460- 101(KI JLNE LEGAL EVERVICES 00426 -07 A46M.00x0 2,049.00 DR460 -20200 2,049.00 CR46(� -101(* x TOTAL VENCG? imul 3,873-90 21 C, * * ** CHECK PREPAID F00023 FRIDLEY, CI7Y CIF A402XN0.0000 MAY PM)NAL SERWEXFEZE 00427 -06 MAY PERSONAL 1,ERV /EXK, -NSE 00427 -07 MAY PO NAL :ERV/EXPENSE 00427 --08 MAY PERSONAL SERV /EXPENSE 00421• -09 MAY PERSONAL SERV/EXPENSE 00427 -01 MAY PERSONAL :DERV /EXPCWE 00427 -02 MAY PERSSONAL SSRV /EXPENL;E 00427 -03 A4G,'!XK0.WOO 367.12 DR450 -20AKI 367.12 CTt450 -10100 A402XN0.0000 950.60 DR4W 02x0 550.60 CR450 -10100 A4622WO. (KkX) 30.01 DR450 -20200 IICI.xl CR450- IOICKI A402Y90.0000 737.:x° DR459,9 •20,20 737.3 C1545: -10100 A46"30BO. (WO 13,360.',Q DR460- 20:701 137360. -,G CR460 -10100 A4G3(kl0. tWO 11.65 DR460.20200 11.65 CR4C+(I -10100 ,140[{000.(u1CK) 103.50 I1,51460-•;'0200 7 103.58 CR460 -10100 JOR NNBR MESSAGES ACCOUNTS PAYABLE CAM ACVAINTS PAYABLE CASIi ACCOUNTS PAYAUF CASH ACCOUWTS PAYABLE CASE;-! ACCOUNTS PAYABLE CASH ACCOUNTS PAYA14LE CASH AC JNTS PAYABLE CASH ACCOUINTS PAYABLE CASCH ACCfXfNTS PAYABLE Ca AC COWS S PAYABLE CASH ACOUINTS PAYABLE CASH AC.CLINTS PAYABLE CASH ACWUN S PAYABLE CAST! A(ZOU VTS � °AYABLE CASH ACX'ILNVTS PAYABLE CASH ACCOUNTS PAYABLC CAS% ACCOUNTS PAYABLE CAS-1-11 DATE 05112 `al CITY OF FRIULEY - MA PAGE 2' Fl?OGRAM POO8 CHECK REGISTER CHECK RUN BATCH # :0005 002 HRA VENIIOR DISC. liciB DESCRIPTION MV # PO /INV # SEQ # PCNT AMOUNT ACCT N ME0 NMBR M SMES MAY PERSONAL SfRV /EXPENSE 00427 -04 W3241%).0=1 764.5`: I1R460-•:fi,100 ACCUUVTS PAYABLE 764.20 C1 kg)-101(() CAM MAY PERSONAL SERV /EXPEL 00427 -05 A4G30XO.0000 10.00 IQ460 -20200 ACTAINTS PAYABLE 10.((1 CR460- 101((1 CASH g TOTAL VENI0i $ g S 15, CA4. 94 2134 n -Hr CHEM- PREPAID M1019 HERRICk & NEWMAN MAY LEGAL SERVICES Mn -01 A4022190. MO 3=x(1.:.'5 DR450- 20:100 ACCOUINTS PAYABLE K,O.25 CR450 -10100 CAS!1 MAY LEGAL SERVICES 00423 -02 A4G2Y6O.0000 6:x.75 DR455 72)2 ) ACCOUNTS PAYABLE 6:.75 C.R455 -10100 CASH MAY LEGAL SERVICES 00423 -03 MUIZVO.0000 '?02.50 DR457 -20200 ACUAIITS PAYABLE M-90 CR457 -10100 CASH MAY LEGAL SERVICES 0047,1414 A4=r- -0.00M 297.50 IR460 -20200 AIDOUNTS PAYABLE 297.5) CCRArhO-10100 CAM f* TOTAL VENDOR * H-f 1,594.00 2135 1 CHECK--PRUTAID cffiF ZZ0113 1- MEHON- GOODLUM- TAYLOR7 INC. APPRAISER FEES 00429 -01 A4G27YO.(" 17500.00 I1R457-20200 AMOUNTS PAYABLE 1,500.(k) M457- 10100 CASH H-ff TOTAL VENDOR # 1,500.00 # TOTAL NMER OF CHECKS WRITTEN : 000000 * TOTAL DOLLARS FOR COCKS WRITTEN : :,',279.01 s-ff LAST CHECK MJMBER : 002121c 7.1 TO: FRIDLEY H.R.A. FROM: CITY OF FRIDLEY RE: BILLING FOR OPERATING EXPENSES FOR MAY, 1991 AND MAY 1991 ADMINISTRATIVE EXPENSES MAY ADMINISTRATIVE PERSONAL SERVICES 13,108.08 MAY ADMINISTRATIVE OVERHEAD 252.25 TOTAL ADMINISTRATIVE BILLING OPERATING EXPENSES: 13,360.33 POSTAGE 11.65 FIRST QUARTER COPIER ALLOCATION 103.58 LODGING & MEALS FOR BILL BURNS 764.33 APRIL FILING - HENDRICKSON 10.00 APRIL MANAGEMENT FEE - KORDIAK REALTY - RICE PLAZA 367.12 MAY MANAGEMENT FEE - KORDIAK REALTY - RICE PLAZA 550.60 ELECTRICITY - RICE PLAZA 30.01 IRRIGATION SERVICE - NATURAL GREEN LAKE POINTE 737.32 TOTAL OPERATING EXPENSES FOR MAY $2,574.61 TOTAL EXPENDITURES $15,934.94 7 ■2 r _ Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley TO: Housing and Redevelopment Authority Members FROM: William W. Burns, City Manager 4A e DATE: May 1, 1991 SUBJECT: University Avenue Signal Improvements The attached memorandum from John Flora requests that the HRA consider expenditure of approximately $40,000 for signalization improvements �o _57tTi and 61st_ - -Avenue_s at l7riivers3 enue . The improvements would bring signalization for these two intersections up to the standards that were identified in our University Avenue corridor plan. It is my understanding that this would include putting the signal poles in the medians rather than at the corners. It would also involve other improvements that would make the intersection more pedestrian friendly. Additionally, John is asking for permission to install internally illuminated street name signs. The advantage of accepting John's proposal is that we can piggyback our improvements on to a MNDot project. Otherwise, the cost of signalization improvements at these two intersections has been previously estimated at $164,000. The project is scheduled to asking that we move quickly these improvements. Staff's request. Thank you. WWB:rsc Attachment commence in April of 1992. John is to amend the MNDot plan to include recommendation is to agree with John's I Engineering Sewer Water Parks Streets Maintenance MEMORANDUM TO: William W. Burns, City Managerk PW91 -102 FROM: John G. Flora,' Public Works Director DATE: April 5, 1991 SUBJECT: University Avenue Signal Improvements I have just received notice from MnDOT that they are proposing to upgrade and replace most of the signals on University Avenue from 37th Street to 85th Street in 1992. Based upon their plan, within the City of Fridley they will be doing the 49th, 51st, 53rd, 57th, 61st and 85th Street intersection signals in the project which is to be bid in November, 1991. -The current estimated cost participation in the project for the- City is..$10,375-.00.' Within the City Is overall plans for the upgrade of University Avenue Corridor, the intersections of 57th and 61st Avenues call for the replacement of the signals at those two (2) sites in order to conform with the corridor concept plans. Accordingly, since MnDOT will be replacing these signals,'it would be to our benefit to have them incorporate into their plans the University Avenue Corridor system so as to allow for future incorporation of all of the other improvements associated with the corridor upgrade. Currently, the HRA has an estimate of $164,000.00 for those two (2) signal improvements. I would expect that if we requested MnDOT to incorporate these improvements into their project, the cost would be something less than $40,000.00 for the two (2). It would be my recommendation that the City submit a response to MnDOT indicating our support of the project with the understanding that the University Avenue Corridor Signals would be installed in accordance with the Barton- Aschman University Avenue Corridor -plans---which would -- - - - -- -- - -- - - -- -- clu$e mew signals, 0_ 5swalks____04SN buttons,_ as__we 1 as , - - Y -- - iri�ernall_ illuminated street name signs_-� Request guidance on whether the City Council and HRA would support this project so that I may inform the appropriate officials at MnDOT. JGF /ts CnYOF FMDLEY 'ttNESO?, Minnesota Department of Transportation 0 2 1.8 n ° Metropolitan District Transportation Building o� St. Paul, Minnesota 55155 OF TRP Oakdale Office, 3485 Hadley Avenue North, Oakdale, Minnesota 55128 Golden Valley Office, 2055 North Lilac Drive, Golden Valley, Minnesota 554M 5801 Duluth St., Reply to Golden Valley, MN 55422 Telephone No. ( 612 ) 591 -4616 March 29, 1991 Mr. John Flora Dir. of Public Works Fridley Municipal Center 6431 University Av. N.E. Fridley, MN 55432 Re: S.P.0205 -61 S.P.0205 -62 S.P.0205 -63 TH47 at 40th Av. NE (CSAH2) and 44th Av. NE TH47 at 37th, 49th (CSAH4 /CR102), 51st and 53rd Avs. NE TH47 at 57th Av. NE (CR102), 61st Av. NE, and CR132 /CSAH3 In Minneapolis-,-Columbia Heights, Fridley, and Blaine Anoka • County Request for Signal Cost Participation ' Dear Mr. Flora, The three referenced projects are programmed by Mn /DOT in order to maintain serviceable signal systems along TH47. (University Avenue). Signal equipment has a useful life of 12 -15 years, before serious and continuing maintenance problems make .replacement necessary. Corrosion and other degradation of both underground and surface components results in high maintenance costs, and in the increasing frequency of failure causing the disruption of traffic flow and safety problems_ The newest of the signal systems programmed for replacement (CR132 /CSAH3) was last rebuilt in 1971, twenty years ago. The oldest ( 61st Av. NE) was last rebuilt in 1965. vA-11- -- --of —theme- j systeins= are. wel- l— bey- -nd -thi i- r- -use-fu -1— Life; —anc - sfiould be replaced) t�en_sure-�-- safe- ,--- effeciv�; and econd r motoring environment Attached are six tables indicating the po osed -- -cost -ancT j iainenance splits -- for —tfiese pra7ECts Each of the three projects has an associated "Cost Participation" table, and an associated "Maintenance Responsibilities" table. The total cost of all three projects will be about X86;000, ) CN nett' = per_ce of_ -come from- feederai-- -HES__ f MINNESOTA 1990 An Equal Opportunity Employer 1 e 1 -C (Hazard Elimination and Safety) funds. Half of the remaining cost will be State funds. The final amount required, approximately $34,000, is being requested from the cities involved, and from Anoka County. $1,750 is being requested from Minneapolis, $8,375 from Columbia Heights,10,'7 from �Frldley;;' and': $13 , 50.0 from Anoka County. How these costs are sp specific project can be seen in the attached tables. A separate agreement will be drawn for each of the three projects. Maintenance responsibilities, as outlined in the tables, remain the same as current practice. I will be happy to discuss these cost splits and funding at your convenience. If you have any questions or comments, please call me or Mr. Joel Katz, the District Traffic Engineer (Ph: 591 - 4605). Sincerely, f Gary L. Ries, P.E. Awy n District Signal Design Engineer cc! R. A.- Stehr G.D. Thompson J.S. Katz Tom Campbell file O 0 D D O I O ® oz/ in 0 0 0 V, Ct Nn � - ��I °I °i�l�il�8 4J .9 ..... . . ........... ......... M z 14 E-1 8 8 An E-4 lV z P 0 Z o z vt wt 4J .9 A."I I,. I,. I,. 1.- 11 - 11 0 go ..... . . ........... ......... M z E-1 8 8 An E-4 lV z P 0 Z o vt wt Z's W% wl cl; z 'o (4 m C4 C4 00 E-4 WL 8 Wi 0 4.) 40% A 41W E-4 CA ot 0 O Zn lz C2, C.4 0 0 P I I ol Q 0 1 1 A."I I,. I,. I,. 1.- 11 - 11 0 go X E-4 0 E-4 ..... . . ........... ......... M z E-1 8 8 An E-4 P X E-4 0 E-4 1-D ..... . . ........... ......... E-1 8 8 An 0 P Z o vt wt W% wl P4 z 'o (4 m C4 C4 00 E-4 WL 8 Wi 0 4.) 40% A O ot O Zn lz C2, C.4 0 0 1-D E-1 An 0 P 1-D 1 -E co r- wrn 0� FNIS �j - • C o� �1 to ell W cn N ta I U ' w O M ILA r- co m w �4 .� 4 �41 > -r, . r I 8 a � C4 C.4 Go co I/1- w w • A • - • • i • 0 N Q+ O Q w s� O w • R 14 c� 1 —F QG T a qw, o r i t N a I > > in ,0r .4 pi 6 6 �1 to ell W cn N ta I U ' w O M ILA r- co m w �4 .� 4 �41 > -r, . r I 8 a � C4 C.4 Go co I/1- w w • A • - • • i • 0 N Q+ O Q w s� O w • R 14 c� 1 —F Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: June 21, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: University Avenue Signal Improvements at 57th and 61st Avenues At the HRA meeting on May 19, 199 as to the type of improvements th and 61st Avenues in conjunction project. The HRA authorized an order to implement some of the rec in the University Avenue corridor We still do not have a detailed of the proposed improvements; we h from MnDOT as of yet. When we do information to the HRA. 1, the HRA wanted to be informed at were going to be made at 57th with MnDOT signal improvement expenditure of up to $40,000 in ommendations that were contained )laps prepared by Barton - Aschman. Ane item cost estimate for each ive not received that information receive it, we will provide that However, we have identified what exists now at the intersections, and what the proposed plans will include. John Flora has written a memo with maps depicting each intersection. Again, the majority of the $40,000 will be expended on the internally illuminated street name signs ($20,000 - $30,000). Street names signs are not indicated on the plans attached to Flora's memo. Existing at each intersection now are street lights at the southwest and northeast corners of the intersection. Under the new plan, two additional street lights will be installed at the northwest and southeast corners of the intersection. This was a specific element of the University Avenue corridor improvement plan. Further, the stamark pedestrian crossing indicators will be placed on all four legs of the intersection. This also was an identified improvement in the corridor improvement plan. Additional traffic signal facilities will be installed at the northwest and southeast corners of each intersection as well as in the medians. To summarize, a majority of the costs will be the internally illuminated street name signs and the remaining money will be for two additional street lights, electrical wiring for the signals, and additional signalization of the intersections. Again, we will return to the HRA with the detailed line item amounts after the project has been bid. BD /dn M -91 -453 • Engineering Sewer Water • Parks (Streets Maintenance MEMORANDUM TO: Barb Dacy, Community Development Director PW91 -153 FROM: - John G. F1oray'Public Works Director DATE: May 23, 19 91 SUBJECT: T.H. 47 Signal Replacement Project At the HRA meeting of May 19, 1991, there was a discussion and approval to upgrade the University Avenue Signal System in conjunction with the MnDOT plan to incorporate the University Avenue Corridor theme. The University Avenue Corridor theme, not counting the red brick, landscaping, bus stops and shelters, calls for placing the push- buttons for pedestrian crosswalks at the various signals, traffic signals for all the various movements, and the installation of internally illuminated.street name signs on the mast arms at the intersection. The attached schematics of the 57th and 61st Avenues intersections with University Avenue indicate in dark colors those new elements' which are to be added to the signal system. In addition the proposal will also include the addition of the internally illuminated street name signs. This is based upon the assumption that MnDOT will shortly come up with a policy approving these installations. if you have any further questions in regards to what this addition entails, please let me know. JGF /ts Attachment c: William W. Burns 8.1 • r oa0000000r�i REMOVE GUARD POSTS F-I .......... v REMOVE GUARD F%,,- . ........ ... .. l 1 8.3 TO: FROM: SUBJECT: DATE: CITY OF FRIDLEY M E M O R A N D U M WILIJAM W. BURNS, CITY MANAGER RICHARD D. PRIBYL, FINANCE DIRECTOR PAUL S. HANSEN, ACCOUNTANT SCHOOL DISTRICT REFERENDUM LEVY RETURNS June 19, 1991 Attached you will find a copy of the estimated 1992 School District referendum levy return amounts based on the attached copy of the estimated 1991 return amounts. The 1992 return agreements are not included but will be submitted to the HRA commission members at a later date for discussion and approval. The estimated total return amount for 1992, before delinquents, is $376,061.10. This is an increase of 14% from the 1991 estimated return amount, before delinquents, of $330,207.52. In the March 28, 1991, memo attached we estimated a 20 increase in the return amount based on an projected increase in market value of approximately 20% and projected all other factors would remain constant. However, all other factors did not remain constant. Class rates were lowered by State legislation which will have a negative impact on tax increment received for payable 1992 and the years to follow. In total the increase is estimated at 14% but, per each individual School District the percentage increase varies greatly. Below shows the estimated 1991 amounts, estimated 1992 amounts, and the perce tage increase /(decrease): School Estimated Estimated Percentage District 1991 amounts 1992 amounts Increase /(Decreas ) 11 $ 15,852.91 $ 17,876.25 13% 13 $ 29,652.37 $ 26,877.31 (9 %) 14 $225,087.09 $271,516.41 21% 16 $ 59,615.15 $ 59,791.14 0% �� -mason tn�am t due to School is kn rc eased by 21 %, even though the class rate decreased, was due to the increase of market value of the Northwest Racquet & Swim Club from $5,479,300 to $12,395,900. Each School District should be aware that these are our best estimates at this time. The market values could be reduced through court decisions, abatements or by other means. Also, delinquents averaged approximately 9% in 1990. ii b 0 U 0 Z Q } m 0 0 U O IW- Q W N M M 9.1 N ti oo OD `... ..... 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' :: c7 co c9 t9 t9 M C4 C43 03 co ol C4 aiC4 uiuiuiuimi ui 'd coZZZ O u) 0) (O CO r O CO O — CY CM Lo C� O1 t0 O O O C u) Of f0 N.<0 O r d 1z O CO r N (0 O r N to N CD CY :< o CD m CO '= QQa�a QGo B0 Y �► �. Y �= m D V d V t .�. co cd ID 4D CL <.< mmm° mmm40m ¢Qum °� L O m m 0 L L L C UU� i8 ° i i zz3C 0C. z a�v- �''''" r r N qt CD T r N qt CO O co O n Of 4h ft 4t: 3k 2 Z. eh m J J c0 m m m = T 'r O <O N r O CO COD co --j N N Go `N N co 9.5 A 1 � CITY OF FRIDLEY M E M O R A N D U M TO: HRA COMMISSION MEMBERS FROM: RICHARD D. PRIBYL, FINANCE DIRECTOR PAUL S. HANSEN, ACCOUNTANT SUBJECT: SCHOOL REFERENDUM LEVY REFUNDS DATE: March 28, 1991 This memo is in response to the HRA commission's question at the March 14, 1991 HRA meeting as to whether or not we could calculate the payable 1992 referendum levy return amounts by July of 1991 instead of December. Assuming we receive the applicable tax information from the county in April or May we could have actual payable 1991 amounts by June of 1991. Therefore, at that time, we could ESTIMATE payable 1992 return amounts based on the payable 1991 amounts plus a possible increase of .20% (see attached projections as presented in a previous meeting). These amounts are only ESTIMATES and would be affected by delinquent taxes, State legislation, or any unforeseeable increases or decreases in overall property values. This matter will be brought up for discussion at the June, 1991 HRA meeting. So, in July a timely decision in regards to the referendum levy return amounts can be given to the School Districts. 9.6 co O) to W -+ y W q Cl) m 2 N co Z7 '< N i� � Q 'D Z (n o " C D O C CO _-I OQ OW T C Z C .o O -u m Z 2 D -0 m -i Q Z (n � o QZ Q x G) � 0 m n O 0 m m `D D rD- r -u Z m Q fJ C �? -I c7 (Tl �] Pi m 0 O m O --n n A cn m y >> F 0 m 9 Z 0 -i m :n o tD 3 7D m o 6 0 few �> � 1 o m cm C W+ p a O Z O Z O 1 ? 0 m D N W '? 00 W fo A w to W N N -+ N W a Z z "coo m m m �O m m o o rn o 0 CO 0 W CD n D CD co CO mm cn °o o° o °o Z �{ c c o° o O o Cl O 0 O 0 O 0 9 O D O "'I x m r- C -D CD ffi CA 169 fo D CD m GO to D O Z v CD m "cWn m W co 69 t0 � in `` � N to fi, fA W 69 � N ° O 0 CD co o w -DC -� O cn W v "aoi _c°o p c ^ _t°n o w rn < t_ O 0 0 o chi o o 1 z O o O 0 O q W o W 0 W O Co -+ W N tD 1 0 Z o % at o° 0 0 0 0° o° 0 3 o Q -a Z m eT _ G' O 69 is a CD < o ° CP3 0 0� D � v Q o m 'o � fo 69 n D N3 o tD .t cwn - o o C) o sp D -< V O "` A - • O to 'C W A 0) A N 0� l.W A '. 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D ca W O O O 0 O Cl Cl � (WTI coo co 0°o O N (Nn p N 0 o� 0 v 69 � co fn fa TMi w fo fo tt) m V (J V D C !!► fA W W N N N N O o O D O O O N co O p O CO "i � p ttn O O O '� y < O O O O N m O O O Cl o O p O O O O _ p o O O O O W m O O p p p O O p p O Q m W "q CD G9 D i D N N m ' 0) 6% -< � ° C7 D �_i j O W N N A D In N n O O D (n O (n N W N N (D CO W V W O0o tD A t N D to 0 W (WJt N O O O O O Cn N A W V A O) En 01 A Ul m C O (WTI OWj V O O O O ° 9.7 ISD #14 FPIDLEY TEL No.612 -571 -7633 Jun 19 91 13:33 No.O01 P.01 SCHOOL INDEPENDENT ♦ VH VLNNI:: L f{LNti c�irCniia F0.flFh' 6000 WLST MOORE LAKE DRIVE, FRIDLEY. MINNESOTA 55432 / 571 -6000 PAXCi12- 571 -76,33 June 19, 1991 Dr. Bill Burns, City Manager City of Fridley 6431 University Avenue NN Fridley, MN 55432 Dear Bill: My understanding is that the HRA will soon be considering the tax increment finance issue for the 1992 --93 school District budget year. First of all let me thank you and the HRA for putting this issue on your agenda in a timely manner. By making a decision on this now, you do provide us the opportunity to factor your decision into our budget planning process. Also, let me again thank the HRA for their past decisions related to turning all school referendum dollars captured within the tax increment districts back to the local School District. These dollars have helped us to maintain and develop quality programs for students. With respect to your impending decision regarding the amount to be returned to the School District in 1992 -93, I would hope that the-HRA would take into account some unusual legislative action during this past session. As I believe you are aware, District 14 intended to hold a tax levy referendum in November of 1991 to generate increased revenue for the 1992 -93 school year and beyond. This revenue was to be used to maintain current program as well as to enhance programs in certain areas. Unfortunately the legislature passed a bill which placed a one -year moratorium on referendums. This action coupled with the passage of a school aids bill that provides only a it increase in revenue in 1992 -93 places the District in a very difficult position. Not only do we receive no new revenue, but our potential access to new revenue is also eliminated. My hope is that as the HRA considers their direction with respect to 1992 -93 tax increment dollars, they will also consider the unusual circumstances the School District faces during that particular budget year. Thank you for your past support and for the continued opportunity to be heard. Sine ely Dennis E. Rens,• PhD Superintendent DER/hi BURNS2IF.WPS irapsmi ", Arno 76A post -tit`" brand fax / rrw++j Zoe:, 7/ _ S Community Development Department D HOUSIIITG AND REDEVELOPMENT Ai7THORITY City of Fridley DATE: June 21, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Update on Fridley Town Square Project Attached is a memo from Jim Casserly regarding the current status of the above - referenced project. Casserly refers to a potential tenancy by Dairy Queen instead of Burger King. I spoke with Don Fitch on June 20, 1991 and he is considering moving to the Fridley Town Square, only if he can have a separate pylon sign. I reviewed with Fitch, and am in the process of contacting Scott Ericson to review with him what the sign ordinance would require for the property. We will also be working with .Fitch in the near future to work out a potential lease arrangement such that when we take ownership on July 25, 1991, the lease will be in place with Fitch. This will be scheduled for HRA's July 11, 1991 agenda. BD /dn M -91 -449 10 c Casserly Molzahn & Associates, Inc. 215 South 11 th Street, Suite 200 • Minneapolis • Minnesota 55403 Office (612) 342 -2277 • Fax (612) 332 -4765 M E M O R A N D U M TO: City of Fridley I�kl.liam Burns arbara Dacy FROM: James R. Casserly DATE: June 18, 1991 RE: Town Square Project I spoke with Patrick Wooldridge, the underwriter at Miller & Schroeder, who has been arranging the construction financing on this project for Scott Ericson. Mr. Wooldridge told me the following: 1. Scott Ericson has secured a stand -by permanent loan from U.S. Life. 2. That Scott Ericson has deposited certain sums with Miller & Schroeder in order to complete the financing. 3. A representative from U.S. Life will be in town the week of June 17th to do a site inspection. 4. Dairy Queen is proposing to use 2,400 square feet (where Burger King was to have been located). The lease with Dairy Queen has been under negotiation for some time and an execution of the lease is expected in the near future. 5. Final commitments from Miller & Schroeder and U.S. Life should be forthcoming by the week of July 15th. Once Scott Ericson has received the final commitments, we should then conclude the negotiations on the development agreement and submit the development agreement to the HRA for its approval. I will let you know as soon as I have heard anything further. JRC /db 10.1 Virgil C. Herrick James D. Hoeft Gregg V. Herrick Of G)unsel David P. Newman TO: Barbara Da�cc��y��AA FROM: Jim Hoeft:54?k DATE: June 7, 1991 H1ERRICK & NEW ALAN ATTORNEYS AT LAW MEMORANDUM RE: Dairy Queen Acquisition This is to provide you with an update as to the above referenced matter. Please note that the Anoka County District Court has approved the transfer of title and possession to the property under the quick take provisions, subject to the expiration of the 90 day waiting period. The effective date of transfer will be July 25, 1991. The Court also appointed all of our recommendations for commissioners, those being as follows: 011ie Erickson, Harvey Peterson and Albert Rordiak, with Richard Erickson and Marlin McCready as alternates. The first meeting of the commissioners is scheduled for Monday, June 17, 1991, at which time the commissioners will be sworn in and will discuss the further scheduling of the commissioners' hearing. As soon as we receive notice of the date of that hearing we should contact Denny Taylor as to his appraisal and testimony thereon. JDH /lal 10.2 Suite 205, 6401 University Avenue N. E., Fridley. fliinnesota 5.5432, 6l_'- 571 -3K5U Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: June 21, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Update on Mississippi Street Improvement Project Consistent with City Council and your direction, I have arranged to have an informational meeting by the Anoka County Public Works Department and the City regarding the Mississippi Street improvement project for property owners and tenants immediately affected by the project. The meeting is proposed to be held on July 8, 1991 at 7:00 p.m. in Meeting Room 1 of the lower level of the Fridley Municipal Center. We have notified all persons, property owners and tenants, from 5th Street on the east side of University Avenue to 2nd Street on the west side of University Avenue. Jon Olsen from the Anoka County Public Works Department has advised us that they have not received a signed permit /agreement from MnDOT regarding the project as of yet. He stated that depending on when Anoka County receives the agreement, they are hoping for a July bid opening with constructing beginning in August. Olsen stated that the project would probably last about ten weeks. The HRA commissioners are invited to the meeting. Tenants of the Rice Plaza building were invited as well as the tenants of the Holly Shopping Center. Councilman Billings is also meeting with representatives from the Fridley Covenant Church and a homeowner from Satellite Lane regarding the City's construction of a temporary road from Satellite Lane to Mississippi Street. This road would remain until the property is redeveloped. Its purpose is to permit people in the Satellite Lane neighborhood to make left -hand turns onto Mississippi Street in order to head toward East River Road. BD /dn M -91 -443 11 4 HOUSING AND REDEVELOPMENT AUTHORITY MEETING, THURSDAY, JUNE 27, 1991 7:30 P.M. BARBARA DACY COMMUNITY DEVELOPMENT DIR. 1 CITY OF FRIDLEY AGENDA HOUSING & REDEVELOPMENT AUTHORITY MEETING THURSDAY, JUNE 27, 1991, 7:30 P.M. Location: City Council Chambers Fridley Municipal Center 6431 University Avenue N.E. CALL TO ORDER: ROLL CALL: APPROVAL OF MINUTES: May 9, 1991 ACTION ITEMS: 1. Consider Request by Dr. Michael Park to Forgive a Portion of the Second Mortgage on the Fridley Plaza Office Building 2. Consider Application for Tax Increment Financing Assistance for Cub Foods Site 3 . Review Approval and Adoption of Expansion of Redevelopment Project Area and Creation of TIF District #11 4 . Discuss Status of Rapid Oil Site 5. Consideration of Rice Plaza Items 6. Approve Removal of Tree Stumps at Lake Pointe 7. Claims and Expenses INFORMATION ITEMS: 8. Memo from John Flora Regarding University Avenue Improvements 9. Policy Discussion Regarding School District TIF Turnbacks 10. Update on Fridley Town Square 11. Update on Mississippi Street Improvement Project 12. Other Business: ADJOURNMENT I • CITY OF FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 CALL TO ORDER: Vice-Chairperson Schnabel called the May 9, 1991, Housing & Redevelopment Authority meeting to order at 7:35 p.m. ROLL CALL: Members Present: Virginia Schnabel, Duane Prairie, John Meyer, Jim McFarland Members Absent: Larry Commers Others Present: William Burns, Executive Director of HRA Barbara Dacy, Community Development Director Virgil Herrick, HRA Attorney Paul Hansen, Accountant Jim Casserly, Consultant George Borer, Attorney for Jai Suh Doug Erickson, Fridley Focus APPROVAL OF APRIL 4, 1991, HOUSING & REDEVELOPMENT AUTHORITY MINUTES: MOTION by Mr. Prairie, seconded by Mr. McFarland, to approve the April 4, 1991, Housing & Redevelopment Authority minutes as written. UPON A VOICE VOTE, ALL VOTING AYE, VICE-CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. 1. CONSIDERATION OF UNIVERSITY AVENUE SIGNALIZATION REQUEST: Mr. Burns stated MnDOT is proposing to replace the signals at approximately nine University Avenue intersections. Two of them are in the University Avenue Corridor project plan which the HRA had previously defined. The project cost is projected at $680,000, 90% of the project cost is to be covered by Federal Hazard Elimination and Safety Funds. The Fridley share is projected at $10, 375. Mr. Burns stated John Flora, Public Works Director, said that this would be an opportunity for the HRA to incorporate the signalization recommendations that were contained in the University Avenue Corridor Plan for two intersections--57th Avenue and 61st Avenue. The original forecast developed by staff and Barton-Aschman at the time the University Avenue HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 2 Corridor was formulated was $164, 000, $82, 000 for each intersection. Mr. Flora said they should get what was in that plan for $40,000 if they incorporate these items in the MnDOT workplan, and he is recommending the HRA give him the authority to expend $40,000 for that purpose. Mr. Burns stated this money will provide the internally illuminated street name signs Mr. Flora has been suggesting for all major city intersections. There are a number of other improvements that are associated with making those two intersections more pedestrian friendly. The HRA's $40,000 would go toward the cost of placing signal standards for improved pedestrian pushbutton controls in the medians and toward the installation of thereto-plastic striping and stop lines at those intersections. Mr. Meyer asked what the intersections would get with the "plain Jane" MnDOT intersection improvement plan. Mr. Burns stated he believed the "plain Jane" MnDOT plan provides only for upgraded signals. In fact, he believed the MnDOT plan will strip the signal standards out of the medians. The MnDOT plan will not provide the internally illuminated street name signs or pedestrian markings as suggested by Mr. Flora. Mr. Meyer asked why MnDOT would want to remove the signal standards. Mr. Burns stated he did not know the answer to that question. Staff will try to get that information. Ms. Dacy stated MnDOT is aware of the Barton-Aschman plans for the entire corridor. In fact, prior to the LRT issue coming up in 1989, the City had actually progressed to the level of receiving a permit from MnDOT. Ms. Schnabel asked if the illuminated street signs will be consistent up and down University Avenue, or will they just be at these two intersections? Ms. Dacy stated illuminated street signs are proposed at the Mississippi intersection and, if approved, at the 57th and 61st Avenues at this time; and then as other intersections come on board to be improved by MnDOT or the HRA corridor plan is implemented, they would be incorporated into those plans. Mr. Hansen stated that the HRA has undesignated funds that are available at this time to cover the $40, 000. Mr. Meyer stated that if they are looking at these two new signals on University Avenue, then it makes him think of HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 3 signals at East River Road and Highway 65. Is there a long range plan to illuminate all the major traffic intersections? Mr. Burns stated the long range plan is to provide the illuminated signs at all major intersections of the three major traffic arteries: East River Road, University Avenue, and Highway 65. Ms. Dacy stated the HRA expense would only be on University Avenue, because that is the plan that was authored and approved by the HRA. MOTION by Mr. Prairie, seconded by Mr. Meyer, to authorize the expenditure of $40,000 for the improvement of two traffic intersections on University Avenue at 57th Avenue and 61st Avenue. These improvements will include: 1. Putting the signal poles in the medians rather than at the corners. 2. Upgrading and replacement of pedestrian signals. 3 . Installing internally illuminated street signs. UPON A VOICE VOTE, ALL VOTING AYE, VICE-CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. Mr. Meyer asked if staff could get more information for the next meeting on the signal improvements. Mr. Burns agreed that more information is needed. 2 . APPROVE HOUSING STUDY OUTLINE: Ms. Dacy stated that at the last HRA meeting, one of staff's recommendations from the interviews they did of other first ring suburbs was to look at conducting a housing study so that the HRA could identify what opportunities there are for successful redevelopment projects in specific areas and what they need to do to maximize those opportunities with the programs that are available. Ms. Dacy stated the study that staff referred to was the Brooklyn Center study, and staff reviewed the Executive Summary of that study at the last meeting. Staff has prepared a detailed outline of the scope of the proposed housing study for the HRA's concurrence or recommendations. It was staff's understanding from the lasts meeting that the HRA did not have a preference as to the consultant, but they did want to review the scope of the study and the cost. [ I HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 4 Ms. Dacy stated the Brooklyn Center study cost about $28, 000. The same consulting firm has done a study for the City of Roseville which cost about $12,000-15,000. The difference between the two studies is that the Brooklyn Center study was a neighborhood-by-neighborhood analysis, a very detailed approach. At this time, $25,000 is allocated in the HRA budget for a miscellaneous category for studies as needed. Staff would like them to see if they can accomplish the task in the outline for about $15,000 or less. Mr. Meyer stated $15,000 doesn't seem like very much considering all the things they want to accomplish with this outline. He did not want a consultant to take a lot of "boilerplate" information from other sources and put it into the study for $15,000. Is $15,000 enough to do a study of the things they want or are they being general about so many long listed items that they are not hitting at the heart of what they really want to find out with a study? Ms. Dacy agreed that staff does not want some "boilerplate" data that is applied to Fridley. They want something that fits Fridley, and they want to know what the trade area is and what market they should be looking at and what area of the community they should be looking at for different kinds of housing. Ms. Schnabel stated that under "Analysis", perhaps they are being too general, and maybe they should better define what they hope to achieve with this type of survey. What areas of housing are aging, and what types of things should they be looking at for upgrading those areas? Should they be encouraging total redevelopment, or is the housing salvageable? Mr. Burns stated he believed they are trying to take a look at the different economic environments in which Fridley exists--state, regional, and local environments. They want to look at the opportunities and threats, the demographic trends, and other things their economic environments tend to point to, and then, based on those opportunities, determine the opportunities and threats they see in their environment and how they can best make use of the tools that are available to the HRA to address the housing needs in Fridley. Those tools include redevelopment, scattered site housing, housing rehabilitation programs, etc. Mr. Burns stated they know some of the sites they want to redevelop. Why not do a site specific research study? This outline does not necessarily exclude that, and that could be done. HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 5 Mr. Prairie asked if cities share studies with other cities. He would think some studies from neighboring cities would be helpful. Ms. Dacy stated they do have a lot of base data available already. The study will get more specific and get at some of the issues of the local market and how the regional sales affect the Fridley trade area. Ms. Schnabel stated her neighborhood is 25 years old. It is not deteriorating, but it is aging. There are neighborhoods that are a lot older and are deteriorating more. It is her feeling that these older, deteriorating neighborhoods are the ones they should try to save or help to preserve these areas from deterioration. Mr. Herrick stated there are two concepts: redeveloping an older neighborhood, and individual home upgrading. He thought the latter is more realistic. He stated that the Robbinsdale HRA has had a scattered home rehabilitation program for 20-25 years. If that is one of the things the HRA has in mind, they should contact the City of Robbinsdale for more information. Ms. Dacy stated that is the issue: What tool do they use and what program do they use where? Mr. Burns stated it is more than just using housing incentive programs. The Brooklyn Center study recommends establishing neighborhood organizations, to establish networking, and to use housing inspection and fire inspection and policing programs to create the conditions that protect housing. So, it is more than just focusing on housing. The Brooklyn Center study also shows there are some inappropriate uses. The study would also be aimed at inappropriate land uses as well. Ms. Dacy stated that, regarding Mr. Meyer's concerns about where specifically they should be focusing their redevelopment efforts, III.B under "Analysis" could probably be better stated. Mr. Meyer stated the two items under III.B, "Identify Fridley neighborhoods, and identify strong and weak neighborhoods" are very important. Numbers A and B under IV. Implementation, are very good also. There just seems to be too much generalization, and $15,000-20, 000 will not give them too much. He would like them to have a firm idea of what they want the study to do and the specifics and then appropriate the necessary money to do that kind of study. Mr. McFarland stated he thought they should take a more comprehensive approach so they do not run the risk of having conflicts after all the information is brought together. HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 6 Staff should work with the consultant to tailor the program to the cost and yet try to get all the benefits they are looking for at the same time. Mr. Meyer stated they should put enough money into the study to give themselves a proper tool that they can do something with, and then do something. Ms. Schnabel agreed. She stated her concern is that they not get a study that is too generalized that they cannot really use. Ms. Dacy stated staff will come back to the June HRA meeting with a more detailed, specific outline. Mr. Burns stated that, between now and the next meeting, staff will work at developing a more focused approach with Maxfield & Associates. 3 . CONSIDERATION OF APPROVAL OF EXPENDITURES FOR SHOREWOOD PLAZA REPLAT: Ms. Dacy stated that after the approval of the Shorewood Plaza Plat, the City determined that the plat drawing indicated the wrong street radii in order to conform to the Municipal State Aid street standards. While the road was constructed according to MSA standards, the plat was drawn incorrectly. Complicating this further, the developer could not record the original 1988 plat because of the various description and title difficulties pertaining to the property. The City did a special Surveyor's Certificate of Correction in 1988 which enabled the developer to record the plat. At this time, they have to correct this situation. Ms. Dacy stated the City's share of the cost for replatting this area is between $2, 000-3, 000. The HRA's responsibility would be $400-600. Staff is recommending the HRA authorize the expenditure of no more than $600 toward the replatting costs of Shorewood Plaza. MOTION by Mr. Meyer, seconded by Mr. Prairie, to authorize the expenditure of no more than $600 toward the replatting costs of Shorewood Plaza. UPON A VOICE VOTE, ALL VOTING AYE, VICE-CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. 4. CLAIMS AND EXPENSES: MOTION by Mr. Meyer, seconded by Mr. McFarland, to approve the expenditures of $1,812 . 60 and $83. 55 to Natural Green, Inc. , for Lake Pointe maintenance; $3,756.58 to Greenmasters, • HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 7 Inc. , for Lake Pointe maintenance; and the check register dated May 2, 1991. UPON A VOICE VOTE, ALL VOTING AYE, VICE-CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. 5. DISCUSSION OF SUH ACQUISITION PROPOSAL: Mr. Burns stated he met with Dr. and Mrs. Suh about two weeks ago. They came in with a proposal to sell the HRA their shopping center property to the HRA for $950,000. They also indicated at that time that the price might be negotiable. Additionally, they suggested that if the HRA did not intend to buy their property that the HRA provide some money for a facelift of their property. Mr. Burns stated he discussed the Suh's proposal with Leon Madsen, City Assessor. He asked Mr. Madsen to comment on the $950, 000 offer and showed Mr. Madsen the different methods the Suhs used for calculating the appraised value. It was Mr. Madsen's general reaction that the $950,000 offer was not a clear bargain for the HRA. Mr. Burns stated the position he had recommended to the HRA previously was the Suh property was not needed at this time and that they were not interested in beginning negotiations with Dr. Suh, however, the Suhs could make an offer if they chose to do so. It is his recommendation that the HRA continue to abstain from negotiating a purchase with Dr. and Mrs. Suh. He also recommends the HRA not be involved in providing a facelift for the Suh property. He believed that any money that is put into that property now, they will have to eventually pay for later at the time the property is either condemned or acquired through negotiation. Also, it is logical to expect that the HRA's investment in property improvements be of a more permanent nature, not a temporary nature. Mr. George Borer, attorney for Dr. and Mrs. Suh, stated that Dr. Suh was not able to attend the meeting. He stated Mr. Burns has accurately relayed the conversations with the Suhs. As he has stated before, it is a fairness issue. They feel 12 years in the district is unfair. They believe the City's actions are damaging their clients and affecting the value of the property. Mr. Burns has clearly indicated to his client that the HRA has no desire to enter into negotiations. However, Mr. Burns said they could make an offer, and they have done that. Mr. Meyer stated he agreed with staff's recommendation. HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 8 Ms. Schnabel stated it appears the HRA is in agreement with staff's opinion and recommendation--that the HRA is not interested in purchasing the Suh property and is not interested in offering money toward the improvement of that property at this time. Mr. Borer stated he would like to request that the Suh property be removed from the district. That request has already been formally responded to, but he would like it to be reconsidered. Mr. Herrick stated that some time ago, Mr. Burns asked him to review the request that Mr. Borer made on behalf of his clients. He believed the first question was if he felt the City or the HRA had any liability for a claim by the property owners that they have been adversely affected by the redevelopment plans of the HRA. Based on the research he did, it was his opinion that neither the City nor the HRA has any legal liability pertaining to the Suh property. Mr. Herrick stated the second question was whether or not he felt that the HRA should purchase the property. He answered that he did not feel there was any legal reason for the HRA to purchase the property unless the HRA thought it was economically feasible to do that, and they could make that decision. Mr. Herrick stated the third question had to do with eliminating the Suh property from the redevelopment district. Again, he did not see any legal requirement or practical reason for the HRA to eliminate it from the district. He stated there might be some problem with removing the property from the district, because the property was pledged for outstanding bonds and the bondholders might have some objection that their security was being diminished. Mr. Borer stated that it is a pure fairness issue, and they want the HRA to know that being in the redevelopment district is affecting long term tenants. Mr. Borer thanked the HRA for their time. 6. UPDATE ON DAIRY QUEEN ACQUISITION PROCESS: Ms. Dacy stated the necessary paperwork has been filed to start the quick-take action. A check in the amount of $125,000 payable to the District Court Administrator was included in the May check register which the HRA approved. Someone from the City Attorney's office will be at the courthouse to participate in the hearing at the end of May to appoint the commissioners and, after that, a hearing date will be set to start the process of evaluating the property. Once HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 9 the check is filed, the HRA will have ownership of the property, subject to the conclusion of the value of the property. Ms. Dacy stated Mr. Fitch contacted her that day. He still wants to keep the door open to negotiate a settlement on this issue. Mr. Fitch is having an appraisal done also, and he wants to negotiate with City staff again in about a month based on the results of that appraisal. Staff has informed him that they will not stop the condemnation process, but there might be an opportunity to pull out of the process. Mr. Herrick stated the City is always willing to negotiate even after the condemnation process has started, so if they can come to an agreement, they will finalize the agreement and dismiss the court action. 7. INFORMATION MEMO REGARDING FRIDLEY TOWN SQUARE PROJECT: Ms. Dacy stated Scott Ericson has informed her that, while they have the construction financing in place, they are pursuing a standby permanent mortgage commitment from a life insurance company. He has not yet heard the outcome of this request. She will update the HRA at the next meeting. 8. RESPONSE REGARDING INSURANCE QUESTIONS: Mr. Dacy stated at the last meeting, Chairperson Commers had raised some questions about whether or not HRA members are personally liable for decisions made by the HRA. She stated there are two statutes pertaining to commission liability. Essentially, the first statute, Chapter 469.014, says that commissioners are not personally liable "on its contracts, or for torts not committed or directly authorized by them". The Authority is liable in contract or in tort in the same manner as a private corporation. Ms. Dacy stated Chairperson Commers also asked staff to look at nonprofit corporations which they did. Minnesota Statute 317A.257 regarding Nonprofit Corporations states that the officers are not civilly liable if the act did not constitute willful or reckless conduct, was done in good faith, and was within the person's scope of responsibility as a director/officer. Ms. Dacy stated the HRA had also raised the question as to whether there was fire coverage on the Kiffe Automotive site. That property is under the City's umbrella policy; however, if that structure is damaged in any way, the HRA would have to discuss whether or not the structure would be renovated or replaced. i 1 HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 10 9. UPDATE ON RAPID OIL SITE: Mr. Burns stated he had handed out new information regarding the Rapid Oil site dated May 9, 1991. Ashland Oil and Ashland Oil 's attorney, Mr. Brill, are asking that the Council schedule their request for a rezoning and special use permit. In view of the HRA's redevelopment goal for this site, the HRA needs to decide if the City should proceed with the rezoning and special use permitting process or should they proceed to begin condemnation proceedings that would allow the HRA to acquire the land for future redevelopment? Mr. Burns stated he would like to present some facts associated with the Rapid Oil site. A. Soil contamination & remediation 1. Design approval by the MPCA with modification 2 . Potential cost of remediation is $500, 000 over 10- 15 years 3. Information on remediation costs at other sites 4. Petro Fund availability - refund for up to 90% of costs for soil remediation and monitoring 5. Likelihood of recovery of our remediation costs through condemnation process B. Value of new Rapid Oil facility - $200,000-300,000 (Mr. Burns stated Rapid Oil intends to build a new quick change oil facility on the site. ) C. Economics of Winfield Project 1. Costs to HRA - $538, 120 2 . Present value at 7.5% of available tax increment over 25 years = $501, 576 3 . Revenue from sale of land at $1. 00/sq. ft. = 86,040 4. Net value to HRA = 49,496 5. Cost to City of lost LGA = 81, 144 6. Net value to HRA/City = ($31, 648) Mr. Burns stated that if we increase their costs for the Winfield project by 50% or more, we are very unlikely to achieve a positive cash flow for a future redevelopment project on this site. Regarding additional impact on the future "gateway" project, preliminary estimates indicate a cost of $2-3 million for residentially oriented "gateway" projects. Mr. Burns stated there are two issues the HRA should consider: HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 11 A. Does the City and the HRA see sufficient public purpose for landbanking additional property? They have already acquired large sections of the southwest quadrant area. Additionally, they expect to negotiate a buy-out for the Lake Pointe project some time in 1991 or early 1992. Does the HRA and the City Council want to take on the cost and the political disadvantages of acquiring more land? B. Soil remediation (environmental issue) . Assuming that the HRA votes yes on the landbanking issue, knowing the liabilities associated with soil remediation, are they better off not purchasing the property at this time? Landbanking Issue A. Pros 1. Acquisition of the property will help us qualify the west side of University Avenue as part of a future redevelopment district. 2 . Acquisition of the property now will help us take advantage of lower real estate prices in a poor market and economy. 3 . There is considerable blight along both sides of University Avenue north of the interstate. Acquisition of the Rapid Oil site will help us address those blighted conditions earlier. 4 . Acquisition of the Rapid Oil property will contribute to our overall goals of redeveloping the University Avenue Corridor. 5. Acquisition of the Rapid Oil property now will help us avoid future costs of acquiring Ashland Oil 's reconstructed/brand new facility. (Estimated new value is $250, 000 plus relocation costs. ) B. Cons 1. Purchasing the Rapid Oil property now may be inconsistent with the HRA's position on purchasing the Suh property. 2. The HRA would incur holding costs: a. 7 1/2% of $230, 000 (acquisition price of existing Rapid Oil) = $17,250 HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 12 b. The City would lose taxes from the proposed reconstruction/brand new facility which are approximately $1,875. c. If we do not lease the property, it becomes tax exempt, and the City, school district, and County lose existing tax dollars (about $6,229) . d. Since the HRA does not have a redevelopment project on line, its holding costs would incur for an indefinite period of time. 3 . There are political implications and risks associated with owning additional land, and there are also additional responsibilities of managing and maintaining the one acre property. 4. If the HRA chooses not to purchase the Rapid Oil property, they could establish a TIF district in this area. As Rapid Oil constructs its new facility, the HRA could take advantage of the new taxes (about $12, 000 per year) minus LGA deducts, that would be generated by the new tax value. LGA deducts would be very minimal (6 1/4% of 33% of $12,500) . Soil Remediation (Environmental Issue) A. The initial cost of remediation should be reflected in reduced purchase price of the property at the time of condemnation. B. Any additional cost of remediation could be recovered through the Petro Fund. C. Actual cost of remediations and impact of remediation on willingness of lenders and investors are still unknown and not likely to be known. Mr. Burns stated staff is recommending the HRA proceed to acquire the Ashland Oil property through condemnation and that the process begin immediately. However, there are many unknowns. We do not know how much longer a recessionary economy will make any future development difficult. Although we are reasonably assured that most of the environmental costs will be covered, we do not know the extent or duration of these costs. Moreover, we do not know the impact that the presence of soil contamination will have on private sector willingness to invest in projects on this site. Mr. Burns stated staff suggests that the HRA separate the landbanking issue from the environmental issue. In doing so, they must first decide whether or not there is sufficient HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 13 public purpose served by landbanking the Ashland Oil property. The decision hinges on the value of eliminating University Avenue Corridor blight including automotive uses along University Avenue. Mr. Burns stated that regarding the environmental risk, if the HRA feels strongly about the redevelopment of the entrance to Fridley and sees the environmental risk as reasonable, then they should proceed to acquire the property. If they do not feel that redevelopment of the "gateway" area is or should be a high priority in this recessionary economy and that the environmental risk is unreasonable, then they should recommend that the Council proceed to act on the land use applications presented by Ashland Oil. Mr. Prairie stated he moderately disagreed with staff's recommendation to acquire the property through condemnation. A new Rapid Oil facility would improve this area, and the HRA can put their money in other areas where it is needed more. He is concerned about the amount of properties the HRA already owns. Ms. Schnabel stated she is also a little concerned about the properties the HRA owns, probably because there is not a lot of development going on and she did not like to see them tying up their resources on acquisitions like this when there are so many problems associated with the property which would become the HRA's responsibility. She stated the HRA's direction a year ago was to start stockpiling some dollars for future problems they might be faced with at Lake Pointe, and she did not see expending a lot of dollars on the Rapid Oil property as being consistent with that direction. Ms. Schnabel stated another reason for not looking favorably at acquiring the Rapid Oil property ties in with the reasons for the recommendation made by staff to not acquire the Suh property. They have tried for many years to get the Winfield project off the ground, but it has failed. Compounding this are the soil problems which create another whole atmosphere for the HRA to not be interested in developing it. Maybe the HRA is better off letting this small parcel go and letting it be developed privately. Mr. Casserly stated this discussion about whether the HRA should get involved came up several times before. He stated there is now some legislation that will help HRA's deal with contaminated properties. So, putting aside the environmental concerns, the real issue becomes: What is the long term plan for this area and do automotive uses help or hinder that long term use? HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 14 Mr. Meyer stated if it costs $230,000 in condemnation, the courts could, in fact, award the HRA $1/2 million for soil remediation. If Rapid Oil expands, do they have to clean up the property? Mr. Burns stated that is correct. John Flora, Public Works Director, is recommending that the City insist that Rapid Oil at least complete the soil remediation part of the project before a building permit is issued. Mr. Herrick Stated certainly someone is going to have to complete the process. He has not seen the MPCA plan, but he had been told it involves some soil removal and then a pumping process with some aeration device, and that pumping process would be a long term process. He thought it would be reasonable that before a building permit is issued that Rapid Oil would have to have at least commenced with the process which has been approved by the MPCA. Mr. Herrick stated the most important part of the legislation mentioned by Mr. Casserly is about the buyer not being the responsible party for soil remediation. The biggest problem he sees is not the liability for the cleanup, but the difficulty in selling the property. Mr. Casserly stated he is pretty positive that this legislation is going to pass. Mr. Herrick stated he is suggesting that the City Council set the public hearing date for June 17, and by that time they will know whether or not the legislation has passed. That will give the HRA one more opportunity to discuss this, and they can then make a decision at the June HRA meeting on whether or not to acquire the property. The HRA members were in agreement with this. 10. RICE PLAZA UPDATE: Mr. Burns stated that regarding the agreement the HRA had with Terrie Mau, she has been unable to get a letter of credit that will cover her unpaid back lease amounts. Mr. Burns stated he has suggested to Jim Kordiak that they get some kind of lien or mortgage on her tanning equipment. Since that time, he has talked to Mr. Herrick, and Mr. Herrick and Mr. Kordiak will be discussing whether or not a chattel mortgage is possible as a substitute for a letter of credit. 11. UPDATE ON CUB FOODS PROJECT: Ms. Dacy stated that staff has asked Jim Casserly to contact the petitioner and get more detailed information on the • HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 15 proforma. Perhaps the HRA could give staff some direction on how to proceed if the financial information is satisfactory. Mr. Casserly has written a memo dated April 15, 1991, regarding the creation of a new TIF district for the site. His memo outlines three options: 1. The Cub Food site qualifies independently as a 25 year redevelopment TIF district. 2 . The Bob's Produce site qualifies independently as a 15 year Renewal and Renovation TIF district; it is unclear whether it qualifies individually as redevelopment. 3 . Together the Cub Food site and Bob's Produce site qualify as a 25 year redevelopment TIF district. Ms. Dacy stated Mr. Casserly recommends that a single 25 year redevelopment TIF district be created for both the Cub Foods site and the Bob's Produce site across Osborne Road. He states that if redevelopment activity does not proceed on the Bob's Produce site within the next few years, the parcels involved in this property can be decertified from the district, thereby avoiding the penalties imposed under Minnesota Statutes. If development activity is proposed, then a separate TIF district could be created at that time. Mr. Prairie asked if they should include the parcels behind Cub Foods in the redevelopment TIF district. Ms. Dacy stated that is a good suggestion, and staff will explore that further. The HRA members concurred with staff's recommendation, to create a single 25 year redevelopment TIF district for both the Cub Foods property and the Bob's Produce site. 12. INFORMATION REGARDING BRICKNER DEVELOPMENT PROPOSAL: This was an information item only. 13. UPDATE ON FRIDLEY PLAZA OFFICE BUILDING: Ms. Dacy stated that at the last meeting, Mr. Commers inquired if there was any assistance given to the Fridley Plaza Office ownership in the last 2-3 years. She stated staff found correspondence between Mr. Commers and Dave Newman, former HRA attorney. Apparently, this money that was in escrow with the trustees of the former owners was not available to the HRA. So, that matter was dismissed. HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 16 Ms. Dacy stated that for the June HRA meeting, staff is anticipating a letter from the new owner of the Fridley Plaza Office building, Dr. Michael Park, as to some type of forgiveness on the second mortgage. Ms. Dacy stated that Fridley Office Plaza owners have accepted the terms made by the HRA at the April meeting regarding the parking lot rental settlement and future parking lot rental payments. ADJOURNMENT: MOTION by Mr. Prairie, seconded by Mr. Meyer, to adjourn the meeting. Upon a voice vote, Vice-Chairperson Schnabel declared the May 9, 1991, Housing & Redevelopment Authority meeting adjourned at 10: 05 p.m. Respectfully submitted, yn Saba Recording Secretary I Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley Memo to: Housing and Redevelopment Authority From: William W. Burns, City Managerd,� • Date: June 21, 1991 Subject: Request from Dr. Michael Park for Forgiveness of Second Mortgage Requirements and Revision of Property Taxes of Fridley Plaza Office Building We have received the attached two letters from Tony Krejci who is representing Dr. Michael Park, the new owner of the Fridley Plaza Office Building. I have addressed the request by sending the attached letter to Virgil Herrick. I have also requested other information from Leon Madsen and from our Finance Department. Although I had planned to be ready to present a recommendation to the HRA at their June 27 meeting, the press of requirements for putting the budget together and other matters have kept me from responding as quickly as I would have liked. I did, however, want to alert the HRA members to the issues that have been raised and to let you know that this is an upcoming issue at our next meeting. WWB/jb Attachments 1 FRIDLEY OFFICE PLAZA May 7, 1991 City of Fridley C/O Ms. Barbara Dacy 6431 University Avenue N.E. Fridley, Minnesota 55432 RE: Settlement offer for Second Mortgage Dear Barb: This letter will suffice as a settlement offer from Dr. Michael Park, Columbia Park Properties, to the City of Fridley (HRA), for a sum of Ten Thousand Dollars ($10,000.00) to settle the second mortgage debt that was placed on The Fridley Office Plaza by the former owner, Mr.Jack Brandt. It has been brought to my attention by Mr. Park and his legal council that if a settlement is not reached, then a final alternative would be to file a stipulated foreclosure,which would cancel out all liens and to include the Second Mortgage. Mr. Park is trying to sustain a good rapport with the city by trying to negotiate these problems with his own funds. Everyone is aware, that these situations were caused by the former owner, Mr. Brandt. Mr. Park has paid $200,568.01 in back taxes(see enclosed exhibits), along with $18,000.00 in delinquent bills, not to include the$10,000.00 settlement to the HRA for the parking lot. Mr. Park has also spent in excess of $120,000.00 to improve the building premises, and to show the City of Fridley that this property will be brought up to city standards. Please review the contents of this letter thoroughly, prior to the (HRA) City Council Meeting to be held on Thursday,June 13th , 1991 at 7:30. I will be there to represent Dr. Michael Park at that meeting. Again, I want to thank you for helping resolve the parking lot problem and if there is any further questions regarding this issue, please feel free to contact any time. Sincer Anthony J. Krejci FRIDLEY OFFICE PIA7A, SUITE 300, 6401 UNIVERSITY AVE. N.E., FRIDLEY, MINNESOTA 55432 1 . 1 11 111/LE Y Ur�11-1L1 YEALIA Zia)/ 15 inn i lUd May 14, 1991 City of Fridley CIO Mr. Bill Burns; City Mgr. 6431 University Avenue N.E. Fridley, Minnesota 55432 RE: Tax Statement on Fridley Office Plaza ' Dear Bill: At this time, I am enclosing pertinent information for your review in regards to the Fridley Office Plaza. Dr. Michael Park has requested that I proceed with the Abatement process and try to recover partial 1989, 1990, first half of 1991 Taxes. Please note that Dr. Park paid $200,568.00 for back Taxes in 1989 — 1990 plus, Dr. Park paid an additional $39,783.08 on May 15, 1991. What is hard to understand, is, Why are the Taxes for Fridley Office Plaza $79,566.16 per year at 30,700 square feet with parking lot lease as additional cost (only foot print ownership), when the Commerce Building is at $39,806.96 per year at 26,000 square feet, and they own land in addition. The Fridley Office Plaza in 1989 showed a net operating income of$226,000.00 or value of $2,260,000.00. For 1990 and 1991, an operating income of$82,920 or value of$829,200.00. When State Bond Company (Former Mortgage holder on the property) performed an MAI appraisal in November 1990,they came up with $850,000.00. That's $739,800.00 lower than the 1991 est. net value. The numbers clearly show that if taxes were prorated according to value,Taxes would be cut in half for 1989 — 1990, the first half of 1991,that would mean an abatement of$120,187.48 ($240,374.96 — 50%). We are not trying to be unreasonable, because as noted in my former letter to Barbara Dacy at the City of Fridley, we want to establish a good rapport with the city and all Creditors the former owner of the building left us. Please help in assisting us in recouping a reasonable amount of these paid taxes. Thank You! Sincer ly, Antho Jci Fridley Office Plaza Mgmt. FRIDLEY OFFICE PLAZA, SUITE 300, 6401 UNIVERSITYAVE N.E., FRIDLEY, A 55432 1 rat/ CITYOF FRIDLEY FRIDLEY MUNICIPAL CENTER.6431 UNIVERSITY AVE. N.E. FRIDLEY,MN 55432•(612)571-3450• FAX(612)571-1287 June 21, 1991 Virgil C. Herrick, City Attorney 205 Fridley Plaza Office Building 6401 University Avenue, N.E. Fridley, MN 55432 Dear Virgil: We have received two letters from Mr. Anthony J. Krejci who represents the new owners of the Fridley Plaza Office Building. In these letters Mr. Krejci is asking that we forgive all but $10,000 of the $40, 000 second mortgage requirement for the Fridley Plaza Office Property. They are also asking that we recognize the current appraised value of the Fridley Plaza Office building and revise taxes consistent with its reduced value. I would like to ask that you provide answers to a number of legal questions that are raised by these two letters. My first concern are in regard to forgiveness of the second mortgage. As I understand our options we can do one of the following: A. Agree to accept a check for $10, 000, B. Seek a continuation of our second mortgage provision through an additional subordination, or C. Insist upon the repayment of the $40, 000. How accurate have I projected our options? What legal considerations should we give to evaluating any of our options? As part of evaluating our options I would also like to consider the legal precedent that we set by forgiving almost three-fourths of a second mortgage. I believe that our development agreement with the original owners of the Fridley Plaza Office Building provides the second mortgage. To what extent are we setting the precedent for forgiveness of second mortgages that may exist in other development agreements? 1 .3 Letter to Virgil C. Herrick June 21, 1991 Page Two I would also ask that you evaluate the tax revision issue from the following perspectives: 1. Our development agreement with the original of the Fridley Plaza Office Building guarantees taxes at the rate of almost $73,000 per year. In your opinion is the minimum tax requirement binding on their successors and assigns? 2. If the minimum tax requirement is binding on successors and assigns, what is the strength of our legal opinion regarding the enforcement of the development agreement should the new owners challenge it? 3. What legal precedent are we establishing for other property owners who might be bound or currently feel bound by the minimum tax provisions of our development agreements? Does an agreement to renegotiate in one case require that we renegotiate in another? Finally, I would like you to opine as to whether or not you think the investment that Dr. Park has made in the Fridley Plaza Office building justifies a forgiving position on the part of the our HRA. To what extent do you feel, as the HRA's attorney, that the new owner of the property has a valid argument? Thank you very much for looking at these items. I am hopeful that we will have your response in time for the July HRA meeting. Sincerely, William W. Burns City Manager WWB/jb Attachments 1 .4 J / HOUSING Community DevelopmentREDEVELOP Department AND MENT City of Fridley DATE: June 21, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Request for Tax Increment Financing Assistance at Former Cub Foods Site Project Request At the May 19, 1991 meeting, we reviewed with the HRA a request of $50,000 to assist in the redevelopment of the former Cub Foods site. Of this amount, $35,000 is to be a loan that is secured by a second mortgage. The remainder, $15, 000, is to be considered a grant. As of June 20, 1991, the petitioners are now requesting $65, 000 in assistance due to increased redevelopment costs. It is proposed that $50,000 would be secured by a second mortgage and $15, 000 would be made in a grant. Proposal The Charles Smith estates owns the property and has retained Mike Hurley as its attorney and Bob Grootwasink as its broker to coordinate the remodeling of the existing building into three retail tenant spaces. At this point, the owners have a signed lease from Pet Food Warehouse for an August 1, 1991 occupancy. As of June 20, 1991, they have advised us that they have a potential lease with Stone Fabric for the second tenant space on the building. We have obtained balance sheets and profit and loss statements for Pet Food Warehouse for the last three years, as well as financial reports. Because of the late notification on Stone Fabric, we were not able to review their statements. Pet Food Warehouse is interested in Fridley because of its developed trade area and its proximity to the Northtown Shopping Mall. They believe that the University Avenue/Osborne Road location has a very high traffic count, and coupled with the Fridley demographics, they believe the market exists for another facility. Pet Food Warehouse currently has other locations in Roseville, Maplewood, and Richfield. 2 Former Cub Foods Site June 21, 1991 Page 2 Project Financing The petitioners have identified hard costs in the amount of $480, 000. Project costs include exterior improvements to the parking lot, including landscaping, seal coating, re-striping, and interior improvements consisting of the roof repair, removal of asbestos-backed floor tiles, finishing the tenant spaces, and improving the interior HVAC systems, lighting and other necessary items. The petitioners received bids on the proposed work, and received bids for the roof and floor tile repair in excess of the originally anticipated costs. The removal of the floor tile was originally bid at $8,000, but after further checking, the bid is $38, 000. The roof repair was originally bid at $28,000; however, that has been determined to be $58, 000. Also adding to the cost of the project are the outdoor improvement requirements as imposed by the ordinance. A 20 foot setback must be created along Osborne Road and along the service drive. In the case of the strip along Osborne Road, the existing bituminous pavement needs to be removed and new landscaping installed. The property owners have secured a mortgage loan of $200, 000 from Northeast State Bank, which will hold a first mortgage lien on the property. Secondly, the fee owners have made available $200, 000 in personal guarantees. Third, the bank has required that the fee owners must deposit a certificate of deposit with the bank as additional collateral for the mortgage in the amount of $50,000. Therefore, the owner's interest in the property approximates $250, 000. Given the additional cost of the roof and floor repair, Mike Hurley indicated that he was going to approach the bank for an additional $20, 000. If that is approved, plus the additional $15, 000 from the HRA, Hurley believes that the project can move forward. Casserly's original analysis was based on the original proposal of $50, 000; $35,000 in a second mortgage and a $15, 000 grant. His cash flow analysis indicated that the $50, 000 could be recovered in approximately six years between loan repayments and tax increment receipts. It was estimated that the redevelopment would add an additional $200,000 in value to the property. At the current time, it is valued at about $832,000. The term on the second mortgage was a ten year- loan at a 9% interest rate. Loan repayments would total $5,454. Now that the petitioner has requested an additional $15,000, the HRA may not be able to recover its investment until year eight or nine. Casserly will have a revised cash flow analysis available at Thursday's meeting. The "But-For" Test Hurley has indicated that if he can obtain the additional $20, 000 2 . 1 Former Cub Foods Site June 21, 1991 Page 3 from Northeast State Bank, that is the maximum amount of financing that he can obtain. Given the poor condition of the existing building and the amount of improvements that need to be made, he indicates that TIF assistance is necessary for the project to move forward. He further reiterates that the building has been vacant for four years and is in a deteriorating condition. In terms of meeting the state requirements for the "but-for" test and to meet the City of Fridley's redevelopment goals, the proposed project will increase the taxable value of the property and will bring an existing substandard/blighted building into conformance with the building and zoning codes, and finally would provide additional employment opportunities. At this time, we only have employment estimates from Pet Food Warehouse. An additional 30 full and part time employees will be located at this facility. The remaining two tenant spaces will also provide employment opportunities. Recommendation Pending additional financial analysis, staff recommends that the HRA approve the request for assistance, and authorize staff to begin negotiations for a development contract. On a future agenda, the development contract will be presented to the HRA for review and approval. The HRA should be aware that the City Council upon establishing the public hearing for July 1, 1991 for creation of the district expressed several concerns about creating another district within the community. They asked staff to provide an overall plan for how many areas within the City would be included in redevelopment and tax increment districts. They have scheduled the public hearing for July 1, 1991, but at this point, they indicated that they were not willing to act on creating the district until July 22, 1991. BD/dn M-91-452 2.2 APPLICATION FORM FOR TAX INCREMENT FINANCING NA Fee owners are as follows: Steven Hardy and Leanne Hardy, Business Name: Kent Gardner and Jerrill Lynn Gardner, and Kent Smith and Spring Smith Address: c/o 400 Northtown Fi nanc`i ng P1 a7a, 7nn rnnn Rapi ac Aiwa r7fv'^-P jlids, MN 55433 Type (Partnership, etc. ) : Fee ownership Representative: Michael F. Hurley Telephone: (612) 780-8500 Name of Counsel: Michael F. Hurley Name and Telephone of Accountant: David A. Doerr List of Financial References: Name/Address/Contact/Telephone Available upon request Other Comments Pertinent to Your Application: Have You Ever Filed for Bankruptcy? Yes No x If Yes, provide details on separate sheet Have You Ever Defaulted on any Loan Commitment? Yes No x If Yes, provide details on separate sheet INFORMATION CONCERNING APPLICANT'S PROPOSED PROJECT Location of Proposed Development: (Attach a Drawing) 250 Osborne Road, Fridley, MN 55432 Nature of Proposed Business: Leaseout of building, proposed tenant is Pet Food Warehouse, who will occupy 60% of the building. 2.3 Principal Business or Product of the Company? Tenant, sale of pet food supplies, wholesale in warehouse atmosphere. Is the Proposed Project a New Facility or Rehabilitation and/or Expansion of Existing Facility? Rehabilitation ancxpansion of.existing facility Industrial/Commercial/Residential: commercial What is the Present Employment of Your Firm: NA What is Your Estimate of Employment One Year After Completion of Project: NA What is Your Estimate of Employment Five Years After Completion of Project: NA Total Estimated Project Cost: $500,000 Total Estimated Construction Costs: $400,000 Potential Other Use(s) of Proposed Development: varied depending on other tenancies we can get in the property Will this Development Attract Other Related Industries: Yes x No How? site will be upgraded rxa ed and more attractive tenants t o other What Types? Unknown ?retail sales What is the Current Zoning Status of the Project Site? C-1 In Rezoning, will Zoning Variances or Conditional Use Permits be Required in Connection with the Project? Unable to determine at this point -2- 2.4 Is the Property Properly Subdivided for the Proposed Use? Yes. However applicants may request subdivision of East part of parcel (Lots 1 and 2) if sal P of property can he accompl i shcd Has Site Approval been Obtained for this Project? No If So, When? By Planning Commission? By City Council? Have You Applied for Conventional Financing for the Project? Yes X No If Yes, Provide Details on Separate Sheet, "H. Information to Attach" If No, Why Not? INFORMATION TO ATTACH Please include: State Public Purpose Description of Project Schematic Drawing of Project See Exhibit A attached Breakdown of Project Costs See Exhibit B attached Amount of Subsidy Request $50,000.00 - $15,000 grant Construction Schedule As soon as financing is secured Legal Description - (Include PIN's) 11-30-24-22-0024 Other Pertinent Information Deposit -3- 2.5 ,, ADDENDUM TO TAX INCREMENT FINANCING APPLICATION FORM Additional Information Public Purpose: The purpose for the tax increment financing would be to upgrade this site so that it may become a viable generator of tax revenue for the city. The property is currently dilapitated and without help from the city in the form of financing, the project may sit dormant for a substantial period of time. Improvements to the property will increase the fair market value and assessed value of the property and the opening of new businesses in the property will result in additional jobs for the community. Description of Property: The entire front of the existing building on the site will be removed and renovated. The current entrance and exit to the building will be removed and renovated. A new brick facia will be placed on the building. The parking lot will be repaved and a new lighting system will be put in. The HVAC system and roof on the property will be repaired and/or replaced. Interior improvements will be completed to meet the needs of the specific tenants. 2.6 Casserly Molzahn & Associates, Inc. 215 South 11th Street, Suite 200 • Minneapolis • Minnesota 55403 Office(612)342-2277 • Fax(612)332-4765 MEMORANDUM TO: City of Fridley Wfillliam Burns arbara Dacy FROM: Mary E. Molzahn 1 James R. Casserly DATE: June 3, 1991 RE: TIF District No. 11 Enclosed please find a cash flow analysis for proposed redevelopment TIF District #11 . This analysis, which includes the Cub Foods and Bob' s Produce sites, will be inserted into the TIF Plan for TIF District No. 11 . It was prepared by combining the individual analyses, prepared previously, for each site. The assumptions, which are detailed on Page 3, include: 1 . inflation of 0. 000%; 2. current tax capacity rate of 101 . 508; 3. administrative expenses of 5.000%; 4 . taxable present value rate of 10 . 000% applied to the total available revenue; 5 . tax exempt present value rate of 8. 000% applied to the local government aid deduction; and 6. pay 1991 tax capacities per Anoka County. Additional assumptions include: 1 . Cub Foods Site The estimated tax capacity of $9, 200 is based on an additional estimated captured market value of $200, 000 . 2. 7 Construction is assumed in 1991 with the first tax increment received in 1993. It is proposed that the Developer will repay the City $35, 000 of the $50, 000 assistance at 9.000% over a term of 10 years . Annual payments approximate $5, 454 . 2. Bob' s Produce Site The estimated tax capacity of $65, 688 is based on two phases. The Phase I estimated tax capacity of $42, 688 assumes estimated construction costs of $1 , 160, 000 and an estimated market value of $928, 000. Construction is assumed in 1991 with the first tax increment received in 1993 . The Phase II estimated tax capacity of $23,000 assumes estimated construction costs of $625, 000 and an estimated market value of $500, 000. Construction is assumed in 1994 with the first tax increment received in 1996. Based on the above assumptions, $1 , 356, 373 is generated in available tax increments, after administrative expenses are deducted, plus $54, 537 in developer repayments for total estimated revenue of $1 , 410, 910. This revenue stream translates into $465, 414 in 1991 dollars based on a taxable present value rate. The total local government aid deduction for both projects is approximately $258, 000 . This amount translates into $63, 128 in 1991 dollars based on a tax exempt present value rate. Also enclosed is a separate cash flow analysis of the Cub Food Site. The differences between this analysis and previous one is a higher interest rate on the City's loan and a reduced class rate to reflect recent Statutory changes. The $50, 000 HRA investment will be recovered in approximately six years between loan repayments and tax increment receipts. If you have any questions, please give a call. MEM,JRC/db encls 2 .8 a W 1 C Q. I .-. W 0 0 0 0 0 0 0 0 0 0 0 0 0) t0 t0 M O) N N M N M N r U) M O CO > 0 r N M CO N at N tO CO 0 O N VI N } 1- ►-. 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H I- w X E La> a O 0 La ►Zr I- Q C3 H J w 2 . 11 (11 a ROBERT A.GUZYBGS THOMAS L.DONOVAN BERNARD 6.STEFFEN M.._MERRILL ROBERT C.HYNES SHARON L.HALL RICHARD A KENNETHPAMELA A.AMDAHLHARRIS CHARLES M.SEYKORA STEPHEN H.MUNSTENTEIGER WILLIAM M.HANSEN RICHARD A.BEENS Barna, Guzy & Steffen, Ltd. JOAN M.THIEMAN RONALD B.PETERSON ATTORNEYS AT LAW DANIEL D.CANTER.JR. DARRELL A.JENSEN BEVERLY K.DODGE DE JEFFREY S.JOHNSON 400 Northtown Financial Plaza OANM.SCOTT M..LEPAK COPAK RUSSELL H.CROWDER 200 Coon Rapids Boulevard STEVEN L.MACKEY JON P.ERICKSON Coon Rapids, MN 55433-5894 OF COUNSEL LAWRENCE R.JOHNSON PETER BARNA DAVID A.COSSI (612) 780-8500 FAX (612) 780-1777 NANCIE R.THEISSEN THOMAS P.MALONE LAWRENCE M.NAWROCKI MICHAEL F.HURLEY PATENT,COPYRIGHT AND TRADEMARK LAW June 7, 1991 Mr. James R. Casserly Casserly Molzahn & Associates, Inc. 215 South llth Street Suite 200 Minneapolis, MN 55403 RE: Food Site/Osborne Crossing Dear Mr. Casserly: I am in receipt of your letter dated June 5, 1991. I apologize for any confusion regarding the amortization of the $200, 000.00 mortgage from Northeast State Bank. The latest figures I gave you are accurate and the bank has agreed to those terms. I have talked to my clients regarding the HRA's .second position with its mortgage. My clients have no objection to this and will sign a subordination agreement at the time they close on their $200, 000. 00 mortgage. I will provide you with all of the information I have provided to the Northeast State Bank, copies of the appraisals, title insurance commitments, environmental assessments, project costs and any other information you may request. I have also asked Bob Grootwassink to immediately send you the 1988 and 1989 income statements for Pet Food Warehouse. I would like to take this opportunity to thank you for your time and energy on this project. You have been extremely helpful. S' cer y yotrs Mi hael F. Hur10t MFH/lj cc: Kent Gardnceaanbia Heights Office Anoka Office Bob Grootw3 it l°enue NE Anoka Professional Building mneapo u, N 55421 403 Jackson Street (612)788 1644 2. L 1 2 Anoka,MN 55303 L (612)427.6300 FROM BARNA GGLIZY LAU) f1FLS. 6. 3. 1931 14:32 P. THOMAS L.DONOVAN 1I.QBERT A.c;ULY I'AM6LA M.HAR.N1 t BIiRNAN.0 1: :TF.FFS:NBGS 5HAR4N L.HALL. RICI IARD A.A�ERRILt. KENNIITH A:AMDAHL RODr•.R F C.WINES CIIARLES M.sEYKORA st'EPHr•.N H.MUNSTENTF.I<1ER WILLIAM M HANSLN Barna) Guzy (Si.. Steffen, Ltd. JQAN M.THIEM.4N RICHARD A BENSDANIEL D.UANTER,II. RONALD B,PETERSON ATTORNEYS AT LAW BEVERLY K.DODGE DARRELL A.JENSEN JOAN M QUADE JEFFRIiY S.)O1INSON 400 Northtown Financial Plaza sCnrl M.1L•PAK IWSSELL II.cA.4tz'uER 200 Coon Rapids Boulevard sTEVEN I..MACKEY JON r,hrac.x ON Coon Rapids, MN 55433-5894 or COUNSEL PETER RARNA I.AWREIVCF R.I01114:;014 NANCIE R.THEISSEN DAVID A.COSSI (612) 780-8500 FAX (612) 780-1777 L.Av1RENf_L•M.NAWROCKI THOMAS P.MAL)Ne. PATENT,(XWPYRIOU F MICHAEL F.BURLEY AND TRADEMARK LAW June 3 , 1991 Mr. James Casserly Casserly Molzahn fi Associates, Inc. 215 South 11th Street, Suite 200 Minneapolis, MN 55403 RE: Osborne Crossing Dear Mr. Casserly: On behalf of the fee owners of the Osborne Crossing property, I have secured a commitment from Northeast State Bank for a mortgage loan with the following particulars: 1. Loan amount - $200, 000. 00 2. Security - First mortgage lien on the property. 3 . Interest rate - 12% 4 . Amortization period - five year fully amortized. 5. Additional security - fee owners must deposit a certificate of deposit with the bank as additional collateral in the amount of $50, 000. 00; fee owners must give personal guaranties for the $200,000. 00 note. I hope the above information is acceptable. If you need any further information regarding the financing proposed by Northeast State Bank, please feel free to contact me. You have also inquired as to the status of any other encumbrances against the Osborne Crossing site. Presently, there exists no debts against the property other than outstanding special assessments. If you have any questions, please feel free to contact me. Sincerely yours, J 1- is.kultiot, Mich .1 F. Hurley MFH/ '.% C Iutnbl.Heights Office Anoka Offlr. 3989 L.entrn1 Avenue NE Anoka Ptnfe■%iuttal Ruildi MintteapnJ',MN 55421 403 j<kc n Street (612)789 1644 2. 13 Anuk.t,MN 55301 (612)477.6300 WEIS WEIS ASSET MANAGEMENT, INC. 3601 Minnesota Drive Minneapolis,Minnesota 55435 Telephone:612-83 4.9060 Fcx:612-831-3132 May 13, 1991 Mr. Mike Hurley Sauna Cuzy & Steffen 200 Coon Rapids Blvd. Coon Rapids, MN 55433 Dear Mike: Enclosed is the most current balance sheet on Pet Food Warehouse I picked it up on 5-10-91 . He states the Fridley store will employee 30 people full and part time at the store with some additional support employees at the home office. Sales pro forma. He predicts the store should see a profit at about the 9 month period with sales of $3,000, 000 annually by the end of the second year. Years 3, 4, and 5 they believe the sales shall increase at least 5% per year. Why Fridley? A. Fridley has a developed trade area. B. Close to North Town Center C. University/Osborne location has the highest traffic count in the city of Fridley with the exception of 694 . D. The trade area demographics look good. E. This location within the city is part of their expansion plans and not too close to an existing Petfood Warehouse. Mike, I hope this information is what you need. Sincerely, Weis Asset Management, Inc. ert E. rootwassink REG/vs Enclosure 2. 14 ROBERT A.GUZYBGS THOMAS L.DONOVAN ' BERNARD E.STEFFEN PAAIELA M.HTRRIS RICHARD A.MERRILL SHARON L.HALL ROBERT C.HYNES KENNETH A.AAIDAlIL CHARLES Al.SEYKORA STEPIIEN H.h1UNSTENTEIC ER $arna Guzy & Steffen Ltd, WILLIAM M.HANSEN RICHARD A.BEENS JOAN M.THIEMAN RONALU B.PETERSON ATTORNEYS AT LAW DANIEL D.GANTER,JR. DARRELL A.JENSEN BEVERLY K.DODGE JEFFREY S.JOHNSON 400 Northtown Financial Plaza JOAN M.QUADE SCOTT M.LEPAK RUSSELL H.CROWDER 200 Coon Rapids Boulevard STEVEN L.MACKEY JON P.ERICKSON Coon Rapids, MN 55433 OF COUNSEL LAWRENCE R.JOHNSONPETER BARNA DAVID A.COSSI (612) 780-8500 FAX (612) 780-1777 NANCIE R.THEISSEN THOMAS P.MALONE LAWRENCE M.NAWRCX KI MICHAEL F.HURLEY March 28, 1991 PATENT,COPYRIGHT AND TRADEMARK LAW Ms. Barbara Dacy Fridley Community Development Director Fridley City Hall 6431 University Avenue N.E. Fridley, MN 55432 • RE: Proposed Tax Increment Financing Application/250 Osborne Road Dear Ms. Dacy: Thank you for taking time out of your busy schedule to meet with myself and the brokers of the transaction, Bob Grootwassink and Richard Walquist. As I indicated to you during our discussion, I represent the fee owners of the property referred to above. The purpose of this letter is to ask that you informally approach the Housing and Redevelopment Authority of Fridley to investigate the possibility of including the property referred to above within a tax increment financing district. If your response is positive, the fee owners of the property will make a formal application for funds from tax increment financing. To fully understand the complexities of this project, I feel it is important for you to understand the historical background behind this property. The building on the property was originally constructed to house a grocery store. Cub Foods fka Fairway Foods, Inc. entered into a long term (30 year) lease for the property in 1968. After . occupying the property for approximately 12 years, Cub Foods decided to vacate the premises and move their operation to another site. After they vacated the property Cub Foods attempted to relet the property. Various small tenants such as Stone Fabrics, American Furniture Outlet, etc. occupied the property from time to time. All of these tenants were on a short term basis. Cub Foods had a below market lease rental. They felt originally that they could sublet the property for the remaining term of the 30 year lease, meet their lease obligations and still make money. However, they were unable to attract any significant tenants. Cub Foods then attempted to sell the property as a way of getting out from under the remainder of their 30 year lease. Of course, any sale of the property would have to be by and through a purchase agreement with the fee Columbia Ifcights Office Anoka Office 3989 Central Avenue NE Anoka Professional Building Minneapolis,MN 55421 403 ackson Street (612)788.1644 2. 1 5 Anoka,MN 55303 (612)427.6300 March 28, 1991 Page 2 owners of the property agreeing to the sale. Cub Foods was unsuccessful in locating a purchaser for the property. In approximately 1987, the fee owners of the property were approached by a prospective purchaser, Southam Development. In order to enter into the Purchase Agreement, it was determined that the fee owners needed to either terminate or buy out the remaining lease term of Cub. The lease interest of Cub in the property was ultimately terminated. The purchase agreement with the Canadian developers (Southam Development) fell through. They were unable to secure financing. Subsequent to Southam Development, the sellers entered into a purchase agreement with JSW Properties. JSW Properties backed out of the purchase agreement after they were unable to secure their anchor tenant. Subsequent to JSW Properties, Linville & Associates, Inc. entered into a purchase agreement with the seller. Linville & Associates Inc. were unable to secure their anchor and adequate financing. They canceled their interest in the purchase agreement. All of the purchase agreements above dealt with some sort of seller financing in order to get this transaction accomplished. The purchase price for this property was reduced dramatically to accomplish a sale. To date, the sellers have been unsuccessful in entering into and completing any purchase agreement for this property. In light of today's market, it is the seller's feeling that the property in its present condition is not saleable. In light of my client's past experience in trying to sell the property, it was determined that some action needed to be taken in order to stop the cash flow drain from the property until the real estate market recovers. My clients are paying real estate taxes of $48, 000. 00 plus utilities and other maintenance expenses without any income of the property. Since we have been unable to sell the property, the sellers have determined that they need to lease the property to stop the cash drain and recognize some return. One anchor tenant, Pet Food Warehouse, has expressed an interest in leasing approximately 60% of the building space. However, in order to lease out this space substantial exterior, heating, air conditioning and tenant improvements must be completed. My clients estimate that the cost to rehab this particular parcel will exceed $400, 000.00. I enclose for your review a copy of a preliminary statement as to costs which will be incurred by sellers for exterior and interior improvements. The purpose of this letter is to request that the City of Fridley Housing and Redevelopment Authority consider tax increment financing to offset some of the seller's cost for completing exterior site improvements to the project. As the property currently stands, there is no tax revenue other than real estate taxes being generated by this project. An improvement to the property by way of site renovation and bringing tenants into the project will generate increased tax dollars and create new jobs 2 . 16 March 28, 1991 Page 3 and other tax revenue for the City. Therefore, the sellers of this property would request that the City of Fridley, Housing and Redevelopment Authority consider the prospect of offering $50, 000. 00 in tax increment financing for this project. The City has indicated that one of the conditions for site approval of this project will be the creating of a green space area between the parking lot and the roadway and revitalizing the parking lot. By way of background, the property originally did have green space between the parking lot and the street. Approximately six or seven years ago the County condemned part of the property to increase the right of way for the highway. The County reimbursed my clients approximately $6, 000. 00 - $7, 000.00 for the taking. The present cost to create the green space will be approximately $40,000.00. The project will also loose parking area as a result of the creation of the green space. In addition, we expect the new exterior lighting system for the project will cost approximately $8, 000.00 and parking lot improvement project including servicing or striping will cost approximately $20,000.00. In addition to these improvements we expect the exterior facelift of the project including removal and remodeling of some of the facia of the building and replacing sidewalks to be approximately $24, 000. 00. Therefore, you can see that the total project cost for just the exterior improvements of this project to exceed $92, 000. 00. In light of the history of the taking of the green space on this project, my clients would like to request that the HRA consider a $15, 000.00 grant to go towards the cost of re-establishing the green area. My clients were paid approximately $7, 000 for the taking of all of this green area. Now at the request of the City, they will be required to re-establish this green area. My clients feel strongly that some costs associated with the establishment of this green area should be shared by Fridley. My clients are now going through the process of trying to locate financing to cover the costs for all improvements to this project. This is an extremely difficult task. The fee owners of this property are not wealthy individuals. Their only security for the property is the project itself. Therefore, the ability of the bank to finance the total amount of the project improvements will be questionable. Therefore, my clients would like to request from the City of Fridley Housing and Redevelopment Authority, $35, 000. 00 in tax increment financing to help offset some of the project costs. The structuring of the repayment of this $35, 000. 00 should not be an issue as to the sellers. This project will enhance both the neighborhood, increase tax revenues and create jobs for the community. I would therefore ask that you informally speak to the Housing and Redevelopment 2 . 17 March 28, 1991 Page 4 Authority to see if the creation of tax increment financing district for this particular project would be acceptable. If so, I will commence the application process. For your information I have included some information regarding the Pet Food Warehouse who will be the anchor tenant for this project. If you need any further information regarding this project, please feel free to contact me. Sincerely, Michael F. Hurley MFH:lj Enclosures Realest\Letters\MDacy 2. 18 Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: June 21, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Consider Approval of Additional Parcels to the Redevelopment Plan and Creation of Tax Increment District #11 Pending the HRA's determination for assistance to remodel the former Cub Foods site, the HRA also needs to approve the addition of the Bob Schroer and former Cub Foods property to the redevelopment project area and to authorize creation of Tax Increment District #11. The attached pages identified as 1-16 and 1-17 represent the additional pages in the redevelopment plan discussing the proposed expenditures of the tax increment district. The pages identified by 12-1 through 12-3 and the accompanying exhibits represent the tax increment plan for the new District #11. Adding these properties into the redevelopment plan is consistent with the objectives of the plan and state statute: improving/modernizing blighted buildings, increasing tax value, and providing additional employment opportunities. As you recall, the district will be a 25 year redevelopment district. The attached memorandum from Jim Casserly and Mary Molzahn describes the cash flow analysis for the district. Casserly will be present at Thursday's meeting to review the cash flow analysis should the HRA have specific questions. We have obtained preliminary information from Bob Schroer to make assumptions as to the amount of value that would be created on his property. Bob Schroer has indicated that he wants to redevelop his property in two phases. For the first phase, he wants to construct a 23,000 square foot building to sell his produce. The second phase would consist of another 12,000 square foot building for additional tenant space. A detailed site plan has not been reviewed by our office at this time; however, we believed it was enough information to give to Casserly to base his projections. The previous memo on the Cub Foods site describes in detail the features of that project. 3 Tax Increment District #11 June 21, 1991 Page 2 Remodeling the existing Cub Foods building and constructing new buildings on the Bob Schroer property meets the objective of removing blighted buildings. Casserly's analysis points out that redevelopment of both parcels will generate estimated revenue of $1,410,910. This revenue is translated into $465,414 in 1991 dollars based on a taxable present value rate. While specific numbers are not known about the estimated number of employees that would be generated at the redeveloped Bob Schroer property, we do know that the Pet Food Warehouse will employ at least 30 full and part time individuals. Pet Food Warehouse represents 1/3 of the remodeled Cub Foods building. While this proposal will add additional area in a tax increment district, it should be noted that three TIF districts will be decertified in the next five years. They are the Johnson Skywood district (1992) , Paschke district (1992) , and the Shorewood district (1995) . Therefore, the tax increment from all of these districts will be distributed to all taxing jurisdictions, in addition to the original tax value already being collected. The HRA at the last meeting inquired about adding additional properties along Commerce Lane into the district. Candidate parcels would be the former Kentucky Fried Chicken parcel and possibly the former Brothen Meat building at 7501 Commerce Lane. Given that we have not received any assistance requests for these parcels, it is more prudent to add these parcels to the redevelopment project area only instead of adding them in the TIF district. It would also be preferable to add these parcels after an overall inventory is made regarding additional parcels eligible for redevelopment. Other priorities may arise out of the housing study, for example. Recommendation Should the HRA proceed to authorize assistance for the former Cub Foods site, staff recommends the HRA approve the attached resolution to approve the modification to the redevelopment plan and approve the creation of Tax Increment District #11 as depicted in the proposed attachments by Casserly. BD/dn M-91-451 3. 1 HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY COUNTY OF ANOKA STATE OF MINNESOTA RESOLUTION NO. A RESOLUTION MODIFYING THE REDEVELOPMENT PLAN FOR REDEVELOPMENT PROJECT NO. 1 AND MODIFYING THE TAX INCREMENT FINANCING PLANS FOR TAX INCREMENT FINANCING DISTRICTS NO. 1 THROUGH NO. 10 TO REFLECT INCREASED PROJECT COSTS AND INCREASED GEOGRAPHIC AREA WITHIN REDEVELOPMENT PROJECT NO. 1 ; AND ESTABLISHING PROPOSED TAX INCREMENT FINANCING DISTRICT NO. 11 AND APPROVING AND ADOPTING THE PROPOSED TAX INCREMENT FINANCING PLAN RELATING THERETO. BE IT RESOLVED by the Board of Commissioners (the "Commissioners") of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority") , as follows: Section 1 . Recitals. 1 .01 . It has been proposed that the Authority modify, approve and adopt the Modified Redevelopment Plan for Redevelopment Project No. 1 to reflect increased project costs and increased geographic area, pursuant to and in accordance with Minnesota Statutes, Sections 469.001 to 469.047, inclusive, as amended and supplemented from time to time. 1 . 02. It has been further proposed that the Authority modify, approve and adopt the Modified Tax Increment Financing Plans for Tax Increment Financing Districts No. 1 through No. 10 to reflect increased project costs and increased geographic area within Redevelopment Project No. 1 , pursuant to Minnesota Statutes, Section 469 . 174 through 469. 179, inclusive, as amended and supplemented from time to time. 1 .03. It has been further proposed that the Authority approve the establishment of proposed Tax Increment Financing District No. 11 and approve and adopt the proposed Tax Increment Financing Plan relating thereto pursuant to and in accordance with Minnesota Statutes, Section 469 . 174 to 469 . 179, inclusive, as amended and supplemented from time to time. 1 3 . 2 1 .04. The Authority has investigated the facts and has caused to be prepared with respect thereto, a Modified Redevelopment Plan for Redevelopment Project No. 1 reflecting increased project costs and increased geographic area; Modified Tax Increment Financing Plans for Tax Increment Financing Districts No. 1 through No. 10 reflecting increased project costs and increased geographic area within Redevelopment Project No. 1 ; and a proposed Tax Increment Financing Plan for proposed Tax Increment Financing District No. 11 , defining more precisely the property to be included, the public costs to be incurred and other matters relating thereto. 1 . 05. The Authority has performed all actions required by law to be performed prior to the modification, approval and adoption of the Modified Redevelopment Plan for Redevelopment Project No. 1 and the Modified Tax Increment Financing Plans for Tax Increment Financing Districts No. 1 through No. 10, and prior to the establishment of proposed Tax Increment Financing District No. 11 and the approval and adoption of the proposed Tax Increment Financing Plan relating thereto. 1 .06. The Authority hereby determines that it is necessary and in the best interests of the City and the Authority at this time to modify, approve and adopt the Modified Redevelopment Plan for Redevelopment Project No. 1 to reflect increased project costs and increased geographic area; to modify, approve and adopt the Modified Tax Increment Financing Plans for Tax Increment Financing Districts No. 1 through No. 10 to reflect increased project costs and increased geographic area within Redevelopment Project No. 1 ; and to establish proposed Tax Increment Financing District No. 11 and to approve and adopt the proposed Tax Increment Financing Plan relating thereto. Section 2. Findings. 2.01 . The Authority hereby finds that the assistance to be provided through the adoption and the implementation of the Modified Redevelopment Plan, Modified Tax Increment Financing Plans and proposed Tax Increment Financing Plan are necessary to assure the development and redevelopment of Redevelopment Project No. 1 . 2.02. The Authority hereby finds that the Modified Redevelopment Plan, Modified Tax Increment Financing Plans and proposed Tax Increment Financing Plan conform to the general plan for the development and redevelopment of the City as a whole. 2 3.3 2. 03 . The Authority finds that the Modified Redevelopment Plan, Modified Tax Increment Financing Plans and proposed Tax Increment Financing Plan afford maximum opportunity consistent with the sound needs of the City as a whole for the development and redevelopment of Redevelopment Project No. 1 . Section 3. Modification, Approval and Adoption of the Modified Redevelopment Plan for Redevelopment Proiect No. 1 . 3 .01 . The modification of the Modified Redevelopment Plan for Redevelopment Project No. 1 reflecting increased project costs and increased geographic area and the approval and adoption of the Modified Redevelopment Plan relating thereto are hereby approved and adopted by the Commissioners of the Authority and are forwarded to the Fridley City Council for public hearing, review and approval. Section 4. Modification, Approval and Adoption of the Modified Tax Increment Financing Plans for Tax Increment Financing Districts No. 1 through No. 10. 4. 01 . The modification of the Modified Tax Increment Financing Plans for Tax Increment Financing Districts No. 1 through No. 10 reflecting increased project costs and increased geographic area within Redevelopment Project No. 1 and the approval and adoption of the Modified Tax Increment Financing Plans relating thereto are hereby approved and adopted by the Commissioners of the Authority and are forwarded to the Fridley City Council for public hearing, review and approval. Section 5. Approval of the Establishment of Proposed Tax Increment Financing District No. 11 and the Approval and Adoption of the Proposed Tax Increment Financing Plan Relating Thereto. 5 .01 . The establishment of proposed Tax Increment Financing District No. 11 within Redevelopment Project No. 1 and the approval and adoption of the proposed Tax Increment Financing Plan relating thereto are hereby approved and adopted by the Commissioners of the Authority and are forwarded to the Fridley City Council for public hearing, review and approval. Section 6. Filing of Plans. 6. 01 . Upon approval and adoption of the Modified Redevelopment Plan, the Modified Tax Increment Financing Plans and the proposed Tax Increment Financing Plan (collectively the "Plans") , the Authority shall cause said Plans to be filed with the Commissioner of Revenue. 3 3 .4 Adopted by the Board of Commissioners of the Authority this 27th day of June, 1991 . Chairman ATTEST: Executive Director CERTIFICATION I, William W. Burns, Executive Director of the Housing and Redevelopment Authority in and for the City of Fridley, County of Anoka, Minnesota, hereby certify that the foregoing is a true and correct copy of Resolution No. passed by the Authority on the 27th day of June, 1991 . William W. Burns, Executive Director 4 3.5 Casserly Molzahn & Associates, Inc. 215 South 11th Street, Suite 200 • Minneapolis • Minnesota 55403 Office(612)342-2277 • Fax(612)332-4765 MEMORANDUM TO: City of Fridley Wyiliam Burns IA.arbara Dacy FROM: Mary E. Molzahn Mt_t^ James R. Casserly n, DATE: June 3, 1991 RE: TIF District No. 11 Enclosed please find a cash flow analysis for proposed redevelopment TIF District #11 . This analysis, which includes the Cub Foods and Bob' s Produce sites, will be inserted into the TIF Plan for TIF District No. 11 . It was prepared by combining the individual analyses, prepared previously, for each site. The assumptions, which are detailed on Page 3, include: 1 . inflation of 0 . 000%; 2 . current tax capacity rate of 101 . 508; 3 . administrative expenses of 5 .000%; 4. taxable present value rate of 10 . 000% applied to the total available revenue; 5 . tax exempt present value rate of 8. 000% applied to the local government aid deduction; and 6. pay 1991 tax capacities per Anoka County. Additional assumptions include: 1 . Cub Foods Site The estimated tax capacity of $9, 200 is based on an additional estimated captured market value of $200, 000. 3.6 Construction is assumed in 1991 with the first tax increment received in 1993 . It is proposed that the Developer will repay the City $35, 000 of the $50, 000 assistance at 9 . 000% over a term of 10 years. Annual payments approximate $5, 454 . 2. Bob' s Produce Site The estimated tax capacity of $65, 688 is based on two phases. The Phase I estimated tax capacity of $42, 688 assumes estimated construction costs of $1 , 160,000 and an estimated market value of $928, 000. Construction is assumed in 1991 with the first tax increment received in 1993 . The Phase II estimated tax capacity of $23, 000 assumes estimated construction costs of $625, 000 and an estimated market value of $500, 000. Construction is assumed in 1994 with the first tax increment received in 1996. Based on the above assumptions, $1 , 356, 373 is generated in available tax increments, after administrative expenses are deducted, plus $54, 537 in developer repayments for total estimated revenue of $1 , 410, 910. This revenue stream translates into $465, 414 in 1991 dollars based on a taxable present value rate. The total local government aid deduction for both projects is approximately $258, 000 . This amount translates into $63, 128 in 1991 dollars based on a tax exempt present value rate. Also enclosed is a separate cash flow analysis of the Cub Food Site. The differences between this analysis and previous one is a higher interest rate on the City' s loan and a reduced class rate to reflect recent Statutory changes. The $50, 000 HRA investment will be recovered in approximately six years between loan repayments and tax increment receipts. If you have any questions, please give a call. MEM,JRC/db encls 3.7 W . Ud. C a C 7 I 1 O O O O O O O O O O O O Ch N d CO d N M U 0) CO th tO d N O J I- 11 (.3 Dc�Q N toa 4- 4- 0 CO U) U) O to 01 dd 0 to to n] f� d 0 N d CO N f� N O1 to (h 0 W t0 U5 .- N Cn .0. U1 tO N 01 O N 01 to Ps 01 N N • .0.. 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O CC 0_ V) Z et st v a v 0 < x w w w CZ N N N N N •~ Q W W O 0 0 M 0 M 0 F 0 oZ„o O Q Z I- iW- Z Q E C7 7 > 0. ►Z-I 1 1 1 .1 1 ti O' .- '- - r- 0 IZ-I F-- < ►- J W 0 3. 10 Casserly Molzahn & Associates, Inc. 215 South 11th Street, Suite 200 • Minneapolis • Minnesota 55403 Office(612)342-2277 • Fax(612)332-4765 MEMORANDUM TO: WILLIAM BURNS BARBARA DACY FROM: MARY MOLZAHN JAMES CASSERLY RE: CREATION OF NEW TIF DISTRICT DATE: APRIL 25, 1991 Consideration is again being given to whether (1 ) a TIF District should be created to include the Cub Food site, (2) a TIF District should be created to include the Cub Food site and the Bob' s Produce site or (3) two separate TIF Districts should be created. After an initial analysis of the two sites in question, the following conclusions have been made: 1 . The Cub Food site qualifies independently as a 25 year Redevelopment TIF District. 2 . The Bob' s Produce site qualifies independently as a 15 year Renewal and Renovation TIF District; it is unclear whether it qualifies individually as Redevelopment. 3 . Together the Cub Food site and Bob' s Produce site qualify as a 25 year Redevelopment TIF District. The attached summarizes the advantages and disadvantages for creating a single TIF District encompassing the Cub Food and Bob' s Produce sites versus creating two individual TIF Districts. 3. 11 SINGLE TIF DISTRICT - ADVANTAGES 1 . It is simpler in terms of time, energy and expense to create a single TIF District: one modification to the Redevelopment Plan, one Tax Increment Financing Plan and one public hearing is required. 2. The City avoids future Legislative restrictions imposed on the creation of TIF Districts or the use of tax increments. 3. The pooling restrictions require 75% of the revenue derived from tax increments to be spent within the TIF District in which they were generated. In a single TIF District, the pooling problem is eliminated. 4. Both sites would have a 25 year term in which to maximize tax increment receipts. 5 . The Local Government Aids deduction would be reduced. A Redevelopment TIF District phases in the LGA deductions at a reduced rate. The Renewal and Renovation District has a 100% phase in of LGA deductions by year 13 versus year 20 for the Redevelopment District. SINGLE TIF DISTRICT - DISADVANTAGES 1 . If redevelopment of the Bob' s Produce site does not occur within the next several years, the tax increment revenue may be limited. It may make sense to create a separate TIF District when the redevelopment is imminent. 2 . The Five Year Limitation requires that all revenues generated within a TIF District be paid to a third party, pledged to bonds, pledged to binding third party contracts, or used for reimbursement of costs paid within five years of the TIF District' s certification. If the redevelopment activity occurs after five years, the tax increment generated after the fifth year must be returned to the taxing jurisdictions. SEPARATE TIF DISTRICTS - ADVANTAGES 1 . Tax increment revenues can be maximized if TIF Districts are created as projects are proposed. 2. The Five Year Limitation is easier to comply with because the redevelopment activities of each TIF District are treated individually. 3. 12 MULTIPLE TIF DISTRICTS - DISADVANTAGES 1 . A modification of the Development Program, the preparation of a tax increment financing plan and the holding of a public hearing is required for each TIF District created. 2 . The City is at risk in terms of Legislative amendments to the Tax Increment Financing Act. 3 . Under the pooling restrictions only 25% of the tax increment generated is available for use in other TIF Districts. If pooling is necessary, the amount of tax increment which may be spent in a different TIF District is greatly limited. 4. The Bob' s Produce site will probably be limited to a 15 year district with the resulting increase in LGA deductions and a substantial decrease in available increment. RECOMMENDATION Based on the advantages listed above for a single TIF District, it is our recommendation that the City consider the creation of a 25 year Redevelopment TIF District including both the Cub Food and Bob' s Produce sites. If redevelopment activity does not proceed on the Bob' s Produce site within the next few years, the three parcels included in this site may be decertified from the TIF District. By decertifying these parcels in the fourth year following the TIF District' s certification, the restrictions and penalties imposed under the Five Year Limitation can be avoided. These parcels may then be included in a separate TIF District when development activity becomes imminent. There are no negative legal consequences in creating a single district and it will allow the HRA to better manage the redevelopment of the Bob's produce site if it so chooses. MEM,JRC/db 3 . 13 Public Trails/Recreational Improvements/Open Space 325, 000 Parking 450, 000 Street Lighting 200, 000 Demolition 500, 000 Relocation 500, 000 Architectural/Engineering Fees 500,000 Administration Fees 400,000 Total $11 , 078, 000 • Maximum Estimated Total Bonded Indebtedness* $14, 401 , 400 *This amount includes capitalized interest in an amount sufficient to pay interest on the bonds from the date of issue until the date of collection of sufficient tax increment revenues to meet scheduled interest payments when due. AS MODIFIED FEBRUARY 26, 1990 TAX INCREMENT FINANCING DISTRICT NO. 10 (NORTHCO PHASE III) Soils Correction $ 70, 000 Administration Fees 4,967 Intersection Improvements to University Avenue Frontage Road and 73rd Avenue 20, 000 Total $ 94, 967 Maximum Total Estimated Bonded Indebtedness* $ 94, 967 *This amount includes capitalized interest in an amount sufficient to pay interest on the bonds from the date of issue until the date of collection of sufficient tax increment revenues to meet scheduled interest payments when due. AS MODIFIED JULY 1 , 1991 TAX INCREMENT FINANCING DISTRICT NO. 11 (UNIVERSITY/OSBORNE SITE) Acquisition $ 200, 000 Demolition 40, 000 Site Cleanup /Preparation and Utility Relocation 200 000 Street Modification ' Ingress/Egress 60, 000 1 - 16 3. 14 Professional Fees 15, 000 Administrative Fees 72, 000 Total $ 587, 000 Maximum Estimated Total Bonded Indebtedness* $ 737, 000 *This amount includes capitalized interest in an amount sufficient to pay interest on the bonds from the date of issue until the date of collection of sufficient tax increment revenues to meet scheduled interest payments when due. Subsection 1 . 10 . Public Improvements and Facilities Within Redevelopment Protect No. 1 . Publicly financed improvements within Redevelopment Project No. 1 include but are not limited to: a. The acquisition and sale and/or lease of the parcels identified in Subsection 1 . 7 . hereof; b. Soil corrections, including excavation and backfill; c. Installation and/or upgrading of utilities and other public improvements; d. Development of proper traffic circulation patterns and improved ingress and egress on public and private roadways; e. Funding of the Reserve Program; and f. Other authorized uses as provided by State law. (The following amendment of Subsection 1 . 10 to the Modified Redevelopment Plan was approved November 18, 1985 . ) Additional public improvement costs to be incurred within Redevelopment Project No. 1 and to be financed by tax increments derived from all tax increment financing districts within Redevelopment Project No. 1 are estimated to be: Land Acquisition $3, 500, 000 Streets, Intersections, Walkways and Lighting 4, 100, 000 Parking Facilities 1 , 500, 000 Soil Correction, Drainage and Landscaping 2, 300, 000 1 - 17 3 . 15 SECTION XII TAX INCREMENT FINANCING PLAN FOR TAX INCREMENT FINANCING DISTRICT NO. 11 (UNIVERSITY/OSBORNE) Subsection 12. 1 . Statement of Objectives. See Section I, Subsection 1 .5. Statement of Objectives. Subsection 12.2. Modified Redevelopment Plan. See Section I, Subsections 1 .2. through 1 . 15 . Subsection 12.3. Parcels to be Included. The boundaries of Tax Increment Financing District No. 11 are described on the attached Exhibit XII-A and illustrated on Exhibit XII-B. Subsection 12. 4. Parcels in Acquisition. The Authority may publicly acquire and reconvey any or all of the parcels in Tax Increment Financing District No. 11 identified on the attached Exhibit XII-A. The following are conditions under which properties not designated to be acquired may be acquired at a future date: (1 ) The City may acquire property by gift, dedication, condemnation or direct purchase from willing sellers in order to achieve the objectives of the Tax Increment Financing Plan; and (2) Such acquisition will be undertaken only when there is assurance of funding to finance the acquisition and related costs. Subsection 12 .5. Development Activity for which Contracts have been Signed. As of the date of adoption of the Tax Increment Financing Plan, the City intends to enter into a Development Agreement with an investment group incuding the following: Steven Hardy, Leanne Hardy, Kent Gardner, Jerrill Lynn Gardner, Kent Smith and Spring Smith, for the rehabilitation and expansion of an existing facility to provide 34, 200 square feet of commercial space with a total construction cost estimated at $400, 000, and anticipated construction completion in 1991 . Subsection 12 . 6. Specific Development Expected to Occur. At this time it is anticipated that a facility providing 34, 200 square feet of commercial space will be rehabilitated and constructed. Additional commercial development is also anticipated and is expected to include an additional 35, 000 square feet with construction costs in excess of $1 , 700, 000 . 12 - 1 3. 16 Subsection 12 . 7. Prior Planned Improvements. The Authority shall, after due and diligent search, accompany its request for certification to the County Auditor or its notice of district enlargement with a listing of all properties within Tax Increment Financing District No. 11 for which building permits have been issued during the eighteen ( 18) months immediately preceding approval of the Tax Increment Financing Plan by the Authority. The county Auditor shall increase the original tax capacity of Tax Increment Financing District No. 11 by the tax capacity of each improvement for which the building permit was issued. If said listing does not accompany the aforementioned request or notice, the absence of such listing shall indicate to the County Auditor that no building permits were issued in the eighteen (18) months prior to the Authority' s approval of the Tax Increment Financing Plan. Subsection 12.8. Fiscal Disparities. The Authority hereby elects the method of tax increment computation set forth in Minnesota Statutes, Section 469. 177, Subdivision 3, clause (a) if and when commercial/industrial development occurs with Tax Increment Financing District No. 11 . Subsection 12 .9. Estimated Public Improvement Costs. The estimated costs associated with Redevelopment Project No. 1 are listed in Section I, Subsections 1 .9 and 1 . 10. Subsection 12 . 10. Estimated Amount of Bonded Indebtedness. It is anticipated that $500, 000 of bonded indebtedness could be incurred with respect to this portion of Redevelopment Project No. 1 . The City also wishes to reserve the right to pay for all or part of the activities listed in Section I, Subsections 1 .9 . and 1 . 10 . as modified July 1 , 1991 relating to Tax Increment Financing District No. 11 as tax increments are generated and become available. Subsection 12 . 11 . Sources of Revenue. The costs outlined in Section I, Subsection 1 . 9 . will be financed through the annual collection of tax increments. Subsection 12 . 12 . Estimated Original and Captured Tax Capacities . The tax capacity of all taxable property in Tax Increment Financing District No. 11 , as most recently certified by the Commissioner of Revenue of the State of Minnesota on January 2, 1991 , is estimated to be $70, 035 . 12 - 2 3 . 17 The estimated captured tax capacity of Tax Increment Financing District No. 11 upon completion of the proposed improvements on January 2, 1995 is estimated to be $129, 601 . Subsection 12. 13. Tax Capacity Rate. The current total tax capacity rate is 101 .508. Subsection 12. 14. Tax Increment. Tax increment has been calculated at approximately $60, 464 upon completion of the improvements assuming a static tax capacity rate and a valuation increase of zero percent (0 . 0%) compounded annually. Subsection 12 . 15. Type of Tax Increment Financing District. Tax Increment Financing District No. 11 is, pursuant to Minnesota Statutes, Section 469. 174, Subdivision 12, a Redevelopment District. Subsection 12. 16. Duration of Tax Increment Financing District. The duration of Tax Increment Financing District No. 11 is expected to be twenty-five (25) years from receipt of the first tax increment. The date of receipt of the first tax increment is estimated to be July, 1993 . Thus, it is estimated that Tax Increment Financing District No. 11 , including any modifications for subsequent phases or other changes, would terminate in the year 2018. Subsection 12. 17 . Estimated Impact on Other Taxing Jurisdictions. The estimated impact on other taxing jurisdictions assumes construction would have occurred without the creation of Tax Increment Financing District No. 11 . If the construction is a result of tax increment financing, the impact is $0 to other entities. Notwithstanding the fact that the fiscal impact on the other taxing jurisdictions is $0 due to the fact that the financing would not have occurred without the assistance of the City, the attached Exhibit XII-E reflects the estimated impact of Tax Increment Financing District No. 11 if the "but for" test was not met. Subsection 12. 18. Modification of Tax Increment Financing District and/or Tax Increment Financing Plan. As of July 1 , 1991 , no modifications to Tax Increment Financing District No. 11 or the Tax Increment Financing Plan therefore has been made, said date being the date of initial approval and adoption thereof by the City Council. 12 - 3 3 . 18 EXHIBIT XII-A BOUNDARIES OF TAX INCREMENT FINANCING DISTRICT NO. 11 UNIVERSITY/OSBORNE AS ORIGINALLY ADOPTED JULY 1 , 1991 P. I .N. 11-30-24-22-0024 11-30-24-22-0020 11-30-24-22-0018 02-30-24-33-0026 XII-A-1 3 . 19 EXHIBIT XII-B • 1 BOUNDARY MAP OF • TAX INCREMENT FINANCING DISTRICT NO. 11 . i ,t.f. 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CO C7 O ua� 0 O CO el,1 U) Ol CO Ott •- } >- V) J J O O O 8 1 I� z 0 cm5m a v v I- V) N N fA Z 1 m m CO CO CO a 0 0 0 0 0 W W W W N N 0 CO N U Li O O O O O O O O O 0I y Z 0 J g N N CV tV M I-- N N N N ('I Z U 0. a a a CC d (AZ *1' i{ VW W W 0 < X •-• CC N N N N N " d W W N Q CIC W 1 1 1 1 1 1 CD 1-- < J .-4 0 W I- U 0 t07 0 U) J VxC .Z-. <<O Q Q W CC Z 1 1 1 1 N Z 4 E Q • C' > • r- I- I- 4- 0 6-1 I- Q F- J lal a 3 . 23 u_ EXHIBIT XII-D "BUT FOR" ANALYSIS The four parcels in the proposed Tax Increment Financing District are located in an area targeted by the City for redevelopment. Existing buildings do not meet city codes and there are several environmental concerns, including the removal of asbestos materials. One building on the site has been vacant for a number of years. In addition to providing job opportunities and increased retail traffic, the rehabilitation of this building will provide an additional $200, 000 in market value to the City' s tax base. Other buildings in the Tax Increment Financing District will be replaced with larger structures providing additional employment and market valuation. Due to the high costs of public improvements including demolition, site acquisition, clean up and preparation, the project would not proceed in the foreseeable future without public assistance. XI-D-1 3 . 24 Community Development Department \ HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley TO: Housing and Redevelopment Authority FROM: William W. Burns, City Manager fr DATE: June 21, 1991 SUBJECT: Rapid Oil Site At the May HRA meeting, we discussed the disposition of a Rapid Oil site inconclusively. If you recall, it was decided that we would postpone a final decision on whether or not to condemn and acquire the Rapid Oil site as we waited the outcome of the 1991 state legislative session. The legislative session is now over. The legislature did pass legislation that would indemnify cities that condemn contaminated property. I also believe that the legislation indemnifies those to whom the future contaminated property might be sold. In order to continue this discussion I have included a copy of the memorandum that I wrote to Council for their June 17 meeting as well as the copy of the legislation on the contamination issue that has been forwarded to me by Jim Casserly. Additionally, I have provided a copy of the outline of my presentation that I made at the May HRA meeting. Finally, I have included a copy of the appraisal that was provided to me by Dennis Taylor of Sheneahon- Goodlund-Taylor, Inc. Staff recommendation at the last HRA meeting was that we acquire this site by condemnation and include it in a future University Avenue gateway redevelopment project. Our feeling has been that although banking large quantities of land in an uncertain economy is not necessarily desirable, I feel that a decision to allow Ashland Oil to build another quick change oil facility on the Rapid Oil site could make future acquisition of this site more than twice as expensive as it currently is. Doubling the cost of the Rapid Oil acquisition will make financial justification for redeveloping the entire "gateway" area very difficult. I also think that with the assurances that we now have received regarding the indemnification from the costs of soil cleanup and remediation that the HRA's risk in acquiring that property has been substantially reduced. 4 Memo to HRA June 21, 1991 Page Two The City Council is currently considering an application for rezoning the Rapid Oil site as well as considering a special use permit that has been requested by Ashland Oil. The rezoning and special use permit will make it possible for Ashland Oil to build their new quick change facility. Council has heard the Rapid Oil site of the issue, they have not yet given a clear indication of their position. My feeling is that Council is genuinely interested in hearing the HRA's advice before they act on the land use applications. Thank you for your reconsideration of this matter WWB/j b 4. 1 MEMORANDUM Municipal Center r 6431 University Avenue N.E.Fridley, MN 55432 Office of the City Manager GNOF William W. Burns FRIDLEY ` (612) 571-3450 TO: The Honorable Mayor and City Council FROM: William W. Burns, City Manager DATE: June 17, 1991 SUBJECT: Rapid Oil Issue At tonight's council meeting you are going to be asked to conduct a public hearing regarding a rezoning of the property located at 5701 University Avenue. The property is owned by Ashland Oil Company and is currently used for a Rapid Oil site. Ultimately, you will also asked to approve a special use permit related to the construction of a new Rapid Oil facility. At the last HRA meeting I presented the attached information and recommended that the HRA proceed to condemn the Rapid Oil property by condemnation. By condemnation we avoid the cost of buying out a newly constructed Rapid Oil facility. In the process we help to hold down the costs of an already marginal University Avenue gateway redevelopment project. At the time of our last HRA meeting the legislature was still debating a bill that would indemnify municipalities and other agencies of the State that choose to condemn property from the costs of removal and remedial actions necessary because of existing environmental contamination. Since our HRA meeting that law has passed (See attached copy. ) . We also know that should we voluntarily take on the responsibility of cleanup and remediation we would, in all likelihood, be reimbursed by Petro Fund for ninety percent of the cleanup and remediation costs. Although there are many issues here and although my recommendation is made with less than perfect confidence, I would ask that we not close the door on the Rapid Oil condemnation through our public hearing process tonight. I would also ask that I have an opportunity to discuss in a more informal setting the recommendations of the HRA which should be forthcoming after their June 27 meeting. Thanks for your consideration. WWB/jb 4. 2 rti cd G) vI ,..g cA i..1 ct c.i_i 4) 0 ›„ 4., ,4 0 0 U •...I 11-) � p O a U 5 O p 9 • o � a) O N•el ••� C.) CA .5 0 ,.0--1 (z) 0 .,_ Iii •d N •PM 0 0 g -I-) .4-1 C ••-•4 O _ Cd al CD g -4-) alO CD 1 1-+ a) Up "0 Oa) Q! O a0) •- ' O- O O •p OM o ra 0 721.4:=1-1 ct C/ 7—7 4: 4c7i t C:i 1 5 g g U N v) O O ,bA O j 0 0 0 � '� OO� o • aU O QC ) Q l C4 • • • • • boa i- 4.3 i-4 = czil T) O ct71 o U y"' 00 4-4 .� .r v1 dt- a, dam- 4D U N 1.,� al CD O4 Cr) U 9 •;O TI CD b�3 In 00 00 •0 .- = •II II II II II Q., O O -0 cs — vl .b 4101 cN ai "CS gO CCSQi ''" > Cr) (-NI N M O '-� a) .4 a) �--+ .2—‘ la n ±) .4... +_. criU •v-, ;-+ O a) O U x4 ,2 OOO 0 CD N 14 > >, N `-' U CD o C.) • Uc13 a),_ co O 2 > a) N O ct NA ••4 "" - c) Ua oP4 ZVZ ct > >1 0 U p 0 c. CA p •+ ) CA 0 a) ,8 c� a) 0 W ►�-4 i- t% • 4.4 O I' a) U N U al O U N N O �' O p C U N • O 3 0 • s-, zi O «3 • o IX (!) 'C . U771 . 0 O a aJ a) 0 H o ° Ct ;� o M c)g E o r., O v Q) N C a) c) . . 0 U rA ~ O •� 4 O ri by I 4) '� • w 0 r„ z ,o -� .g o c °, oE 21 a) w ,�? U > il •'�c 4 4 '-' O -1 cCoH H o o p4 0 O a. 4.5 0 CD06 O bA O •�, ' II 8 4. tr) 4-4 U Q., = 0 . . = i .a - 0-4 .� p >, ON PC rUi) 0 E. O a) •1 I E - Nc) c �. N ,�" _, a)O O "'CI ct N II U ;o v o _ cli '� •- �; N UO O N rn .---1 .--, O O O H ct• U a a (f) r-i (Nj Cr; C 0 c) 4.6 • • o • O CA a) Cl) �p 0 7-46 a - O O a, 4 a �0 o i CA a) . C> C a)o U 0 0 ;.., 0 ct U a) «3 a) U .,Ui U Cl) . rn O 0 0 a) :0 r-+ ct3 0 o a, .0 •~ - °), 0 U r O 0 U .o O Co a) a) O. E 0 �O 0 a) 0 O 3 O .� 0 U 0 0 •cd v),, 4=4 0 -0 ' 0 sa) g Wo s o a' o i E 3 .- " +-'] ra4eTh ct U .-. .-.w ►—•i O ,� .� O F-+ Q 0 G4 U CC 4 p4 U • 4. 7 C" SHENEHON-GOODLUND TAYLOR, INC. s155 DULUTH s ulc MINNEAPOLIS,MN 65422 612/544-9860 j : May 3, 1991 Ms. Barbara Dacy Community Development Director City of Fridley 6431 University Avenue Northeast Fridley, Minnesota 55432 RE: MARKET VALUE APPRAISAL OF RAPID OIL CHANGE SITE AT 57TH AND UNIVERSITY AVENUE NORTHEAST, FRIDLEY, MINNESOTA Dear Ms. Dacy: We have completed an appraisal of the above captioned property as you requested. We certify that we have personally inspected the property. To the best of our knowledge and belief the statements of fact contained in this report and upon which the opinions herein are based are true and correct, subject to the assumptions and limiting conditions explained in the report. Employment in and compensation for making this appraisal are in no way contingent upon the value reported, and we certify that we have no interest, either present or contemplated, in the subject property. We have no personal interest or bias with respect to the subject matter of the appraisal report or the parties involved. This appraisal assignment was not based on a minimum valuation, a specific valuation or approval of a loan. This appraisal report identifies all of the limiting conditions (imposed by the terms of our assignment or by the undersigned) affecting the analyses, opinions, and conclusions contained in this report. The value indication in this appraisal assumes there is no soil, groundwater or environmental contamination in/on the subject property. An environmental assessment of the property has not been conducted to your appraiser's knowledge. Should the subject property be contaminated, the market value indicated in this appraisal is subject to change. The appraisers are aware of contamination but they are not environmental experts and therefore recommend an inspection by environmental companies if there are concerns. REAL ESTATE APPRAISERS • ANALYSTS 4.8 f Ms. Barbara Dacy May 3, 1991 Page 2 No one other than the undersigned prepared the analysis, opinions, or conclusions concerning real estate that are set forth in the attached appraisal report. In our opinion, the subject property had a most probable market value of fee simple interest on April 1, 1991 of: TWO HUNDRED THIRTY,THOUSAND DOLLARS $230,000 This appraisal consists of three separate legal descriptions and assumes tha the site size is 41,180 square feet. The value conclusion of this report is our estimate based on accepted real estate appraisal practice and has been made in conformity with and is subject to the requirements of the Code of Ethics and Standards of Professional Conduct of the Appraisal Institute. If you have any questions or comments after reading the appraisal report, please contact our firm. Very truly yours 0 DLUND—TAYLOR, I . 1ZL� E. Taylor, , SRPA /ns • 4 .9 Casserly Molzahn & Associates, Inc. 215 South 11th Street, Suite 200 • Minneapolis • Minnesota 55403 Office(612)342-2277 • Fax(612)332-4765 MEMORANDUM TO: City of Fridley LWil1iam Burns Barbara Dacy FROM: James R. Casserly DATE: May 30, 1991 RE: Enclosed Legislation Enclosed are copies of legislation which have passed the legislature and which we expect the governor to sign. These should help us in our resolution of the Rapid Oil site. JRC/db encl dq /9 91 4. 10 `' HF236 UNOFFICIAL ENGROSSMENT [REVISOR ] CA , UEH0236-1 - unofficial engrossment 1 A bill for an act 2 relating to eminent domain; allowing entry onto land 3 for environmental testing before beginning eminent 4 domain proceedings; providing for findings regarding 5 the cost of removal and remedial actions relating to 6 environmental contamination; amending Minnesota 7 Statutes 1990, sections 117.041; and 117.085. 8 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 9 Section 1. Minnesota Statutes 1990, section 117.041, is 10 amended to read: 11 117.041 [ENTRY FOR SURVBYS SURVEY OR ENVIRONMENTAL 12 TESTING.] 13 Subdivision 1. [SURVEYS.] For the purpose of making 14 surveys and examinations relative to any proceedings under this 15 chapter, it shall be lawful to enter upon any land, doing no 16 unnecessary damage. 17 Subd. 2. [ENVIRONMENTAL TESTING BEFORE EMINENT DOMAIN 18 PROCEEDINGS.] (a) A state agency by order of the commissioner or 19 a political subdivision by resolution may enter property for 20 purposes of investigation, monitoring, testing, surveying, 21 boring, or other similar activities necessary or appropriate to 22 identify the existence and extent of a release or threat of 23 release of a hazardous substance, pollutant, or contaminant if: 24 (1) the state agency or political subdivision has reason to 25 believe that acquisition of the property may be required 26 pursuant to eminent domain proceedings; 1 4. 11 HF236 UNOFFICIAL ENGROSSMENT [REVISOR ) CA. : UEH0236-1 .. 1 (2) the state agency or political subdivision has'reason to ' • 2 believe that a hazardous substance, pollutant, or contaminant is 3 present on the property or the release of a hazardous substance, 4 pollutant, or contaminant may have occurred or is likely to 5 occur on the property; and 6 (3) entry on the property for environmental testing is 7 rationally related to health, safety, or welfare concerns of the 8 state agency or political subdivision in connection with 9 possible eminent domain proceedings. 10 (b) At least ten days before entering the property, the 11 state agency or political subdivision must serve notice on the 12 property owner requesting permission to enter the property, 13 stating the approximate time and purpose of the entry, and 14 giving the owner the option of refusing entry. The notice shall 15 also give the owner the option of requesting an equal amount of 16 any sample or portion taken from the property and a copy of any 17 data obtained or report issued. If the property owner refuses 18 to consent to the entry, the state agency or political 19 subdivision must apply for a court order authorizing the entry 20 and the removal of any sample or portion from the property, 21 giving notice of the court order to the property owner. The 22 court shall issue an order if the state agency or political 23 subdivision meets the standards in paragraph (a). Notices under 24 this paragraph must be served in the same manner as a summons in 25 a civil action. 26 (c) The state agency or political subdivision must do no 27 unnecessary damage to the property and shall restore the 28 property to substantially the same condition in which it was 29 found. If the state agency or political subdivision removes a 30 sample or portion of the property for investigation, monitoring, 31 or testing, or obtains any data or issues any report, it must 32 give the property owner an equal amount of the sample or portion 33 and a copy of any.data or report, if requested by the property 34 owner, and must permit the property owner to perform independent 35 investigation, monitoring, or testing of the sample or portion. 36 (d) The results of test _nn performed under. paragraph (a) 2 • 4. 12 HF236 UNOFFICIAL ENGROSSMENT [REVISOR ) CA UEH0236-1 . 1 must be included in any environmental assessment worksheet or 2 environmental impact statement that the state agency or 3 political subdivision is required to prepare under chapter 116D. 4 Sec. 2. Minnesota Statutes 1990, section 117.085, is 5 amended to read: 6 117.085 [COMMISSIONERS, POWERS, DUTIES. ] 7 The commissioners, having been duly sworn and qualified 8 according to law, shall meet as directed by the order of 9 appointment and hear the allegations and proofs of all persons 10 interested touching the matters to them committed. They may 11 adjourn from time to time and from place to place within the 12 county, giving oral notice to those present of the time and 13 place of their next meeting. All testimony taken by them shall 14 be given publicly, under oath, and in their presence. They 15 shall view the premises, and any of them may subpoena witnesses, 16 which shall be served as subpoenas in civil actions are served, 17 and at the cost of the parties applying therefor. If deemed 18 necessary, they may require the petitioner or owner to furnish 19 for their use maps, plats, and other information which the 20 petitioner or owner may have showing the nature, character, and 21 extent of the proposed undertaking and the situation of lands 22 desired therefor. In proper cases they may reserve to the owner 23 a right of way or other privilege in or over the land taken, or 24 attach reasonable conditions to such taking in addition to the 25 damages given or they may make an alternative award, conditioned • 26 upon the granting or withholding of the right specified. 27 Without unreasonable delay they shall make a separate assessment 28 and award of the damages which in their judgment will result to 29 each of the owners of the land by reason of such taking and 30 report the same to the court. The commissioners, in all such 31 proceedings, may in their discretion allow and show separately 32 in addition to the award of damages, reasonable appraisal fees 33 not to exceed a total of $500. Upon request of an owner the 34 commissioners shall show in their report the amount of the award 35 of damages which is to reimburse the owner and tenant or lessee - - 36 for the value of the land taken, and the amount of tha award of - 3 4 . 13 a HF236 UNOFFICIAL ENGROSSMENT [REVISOR ] CA UEH0236-1 1 damages, if any, which is to reimburse the owner and tenant or 2 lessee for damages to the remainder involved, whether or not 3 described in the petition. The amounts awarded to each person V/ 4 shall also be shown separately. The commissioners shall, if e3Ti%4Ar&D 5 requested by any party, make an express finding of the mistme 6 cost of removal and remedial actions that will be necessary on 7 the taken property because of existing environmental 8 contamination. 4 74 rrul,ln. IL LIIC auo •.i -- - -. SF822 THIRD ENGROSSMENT [REVISOR J JC S0822-3 Version as sent to Governor 1 A bill for an act 2 relating to the environment; clarifying that certain 3 persons who own or have the capacity to influence 4 operation of property are not responsible persons 5 under the environmental response and liability act 6 solely because of ownership or the capacity to 7 influence operation; amending Minnesota Statutes 1990, 8 section 1158.03, by adding subdivisions. 9 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 10 Section 1. Minnesota Statutes 1990, section 115B.03, is 11 amended by adding a subdivision to read: 12 Subd. 5. [EMINENT DOMAIN.] (a) The state, an agency of the 13 state, or a political subdivision that acquires property through 14 exercise of the power of eminent domain, or through negotiated 15 purchase after filing a petition for the taking of the property 16 through eminent domain, or adopting a redevelopment or 17 development plan under sections 469.001 to 469.134 describing 18 the property and stating its intended use and the necessity of 19 its taking is not a responsible person under this section solely 20 as a result of the acquisition of the property. 21 (b) A person who acquires property from the state, an 22 agency of the state, or a political subdivision, is not a 23 responsible person under this section solely as a result of the 24 acquisition of property if the_property was acquired by the 25 state, agency, or political subdivision through exercise of the 26 power of eminent domain or by negotiated purchase after filing a 27 petition for the taking of the property through eminent domain a 1 1 SF822 THIRD ENGROSSMENT (REVISOR ) JC S0822-3 1 or adopting a redevelopment or development plan under sections 2 469.001 to 469.134 describing the property and stating its 3 intended use and the necessity of its taking. 4 Sec. 2. Minnesota Statutes 1990, section 115B.03, is 5 amended by adding a subdivision to read: . 6 Subd. 6. [MORTGAGES. ) (a) A mortgagee is not a responsible 7 person under this section solely because the mortgagee becomes 8 an owner of real property through foreclosure of the mortgage or 9 by receipt of the deed to the mortgaged property in lieu of 10 foreclosure. 11 (b) A mortgagee of real property where a facility is 12 located or a holder of a security interest in facility assets or 13 inventory is not an operator of the facility for the purpose of 14 this section solely because the mortgagee or holder has a 15 capacity to influence the operation of the facility to protect 16 its security interest in the real property or assets. 17 Sec. 3. Minnesota Statutes 1990, section 115B.03, is 18 amended by adding a subdivision to read: 19 Subd. 7. (CONTRACT FOR DEED VENDORS.) A contract for deed 20 vendor who is otherwise not a responsible party for a release or 21 a threatened release of a hazardous substance from a facility is 22 not a responsible person under this section solely as a result 23 of a termination of the contract for deed under section 559.21. 2 4. 16 f � Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: June 21, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Consideration of Rice Plaza Items To follow is a list of issues regarding the Rice Plaza Shopping Center. Some issues need discussion and action by the HRA, and some are for the HRA's information. 1. Jim Kordiak received a letter from My Sister's Closet requesting the City of Fridley HRA reduce the rent by 1/2 during the Mississippi Street improvement project. There is another memo in the agenda regarding the status of the Mississippi Street project; however, the length of the project is estimated at ten weeks. I checked with the management of Holly Center to determine whether they would be offering a similar arrangement to their tenants. Gary Jackson advised me that they have not done that as a leasing company in the past, and they do not anticipate doing it for the tenants at Holly Center unless there is a "hardship" request from a particular tenant. We will be inviting all of the tenants of Rice Plaza and the Holly Shopping Centers to an informational meeting on the Mississippi Street project on July 8, 1991. This issue is sure to be asked at the meeting. The HRA should discuss whether or not such a reduction would be applicable during the construction period. After speaking with Kordiak and Jackson, it is my recommendation that the HRA not authorize a rent reduction at this time. 2. Norge Village, the dry cleaner business, has left the Rice Plaza property. Kordiak has advised us that there is a lot of specialized equipment that does remain. Kordiak wanted to warn us that the HRA may have to assume the cost for removing some of the appliances. The estimated cost at this time is $2, 500; however, Kordiak is working with Norge Village to remove all items. 5 Rice Plaza Items June 21, 1991 Page 2 3. Children's Charm will also be leaving the building as of June 30, 1991. Kordiak reported that this tenant space has water damage on the floor at the rear portion of the building. Our Public Works Department is currently investigating it. BD/dn M-91-450 5. 1 ' ' My Sister's closet 244 Mississippi St. NE Fridley, Minnesota »o*»» � � - ' ------' ------------ - ' ' --�- �� i All -�� '��—��J-/- | / � - -------�----------- ---��I�-L-�i � --` ' --T ---- ------ / �'~~ -^'-� --` --------'-'-� � ---7------------------- --------�------------�-'--' -- ---- } -�--- ------------ - --' ------ — -- . . . „ 03-Jun-91 RICE PLAZA 1991 RENT NMARCRI SigiaiAkeign millaran NORGE VILLAGE 1,100.00 1,239.56 1,188.61 1,243.61 2,192.06 6,963.84 METZ BAKING 702.98 755.63 755.63 737.21 1,537.58 4,489.03 CHILDREN CHARM 890.02 712.46 851.16 661.90 3,115.54 HONG KONG KITCHEN 752.97 805.63 787.21 810.31 2,115.64 5,271.76 MY SISTER'S CLOSET 793.74 855.63 1,177.52 1,169.94 3,996.83 CINNAMON SKIN TAN 800.00 1,000.00 1,500.00 1,200.00 4,500.00 RAPIT PRINTING 897.14 889.00 965.22 1,022.61 2,134.92 5,908.89 TOTAL 3,453.09 6,173.58 6,264.76 7,342.42 11,012.04 34,245.89 YEAR TO DATE 3,453.09 9,626.67 15,891.43 23,233.85 34,245.89 34,245.89 • 5.3 • Community Development Department \ HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: June 21, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Consider Approval of Removal of Tree Stumps at Lake Pointe Attached is a memorandum from Mark Winson recommending that-the HRA remove 50 tree stumps at Lake Pointe. Winson points out that these tree stumps are from trees that died last year and were not replaced because the warranty had run out on the original landscape contract. Winson received a quote from Green Masters, the contractor responsible for maintaining Lake Pointe, in the amount of $2, 325. 00, or $46.50 per stump. Recommendation Stump removal is not part of the typical maintenance contract that the HRA has with Green Masters; however, as you may recall, we saved a significant amount of money when we went out to bid for the Lake Pointe maintenance agreements. We had originally budgeted for $36,500, and the awarded contract to Green Masters was for $27, 680. Therefore, the $2, 325 can easily be assimilated into the "Services Contracted" Non-Professional budget. Staff recommends that the HRA authorize the Public Works Department to notify Green Masters Industries to remove 50 tree stumps at $46.50 per tree. BD/dn M-91-448 6 Engineering N • WY Water Er 0 Parks o 3 Streets VV Maintenance W J CC CO as MEMORANDUM TO: Barbara Dacy, Community Development Director PW91-162 FROM: Mark A. Winson, Asst. Public Works DirectorMIJ DATE: June 3, 1991 SUBJECT: Tree Stumps at Lake Pointe There are numerous tree stumps at the Lake pointe sites from trees that have died and were not replaced because they were out of warranty. Our 1991 Lake Pointe Maintenance Contractor has pointed out to Jon Thompson that this is a potential injury situation to pedestrians and bikeriders using the pathways within Lake Pointe. Because there is a potential for injury which could be a liability to the City and also the stumps detract from the appearance of the site, I ask that you have the HRA consider approving funds to remove the stumps. Jon Thompson is in the process of obtaining a price from our 1991 Lake Pointe Maintenance Contractor for this stump removal. MAW/ts 11J CJTYOF 6. 1 H4DLLY Omen �7� `, d J / Mastersie " industries,inc. Professional Landscape Management ' WATERFORD PARK•505 HIGHWAY 169 NORTH•SUITE 775•PLYMOUTH,MN 55441 •(612)591-5858•FAX(612)591-6185 June 4, 1991 City of Fridley 6431 University Ave. N.E. Fridley, Minnesota 55432 Attn: John Thompson Dear John: We have reviewed the removal costs for the stumps as requested. It appears there are approximately 50 stumps to be removed at the park. The cost for: - Removal - Disposal - Fill hole with black dirt - • Seed will be $ 46.50 per tree. If the city would like us to proceed with the project, please give us a call. cere , L,5`a 03Zc- H. Randal Toth Account E ecutive HRT/pjl 6 . 2 MEMBER ASSOCIATED LANDSCAPE CONTRACTORS OF AMERICA DATE 06/12/91 CITY OF FRIDLEY - HRA PAGE 1 PROGRAM PO08 CHECK REGISTER CHECK RUN BATCH # :0005 002 HRA VENDOR DISC. JOB DESCRIPTION INV # PO/INV # SEQ # PCNT AMOUNT ACCT NUMBER NMBR MESSAGES 2129 **u# CHECK-PREPAID #### G00069 OREENMASTERS, INC LAKE POINT MAINT PROJ 218 00423-01 A4G2YC0.0000 3,756.588 IR455-20200 ACCOUNTS PAYABLE 3,756.58 CR455-10100 CASH **i* TOTAL VENDOR J*a* $ 3,756.58 2130 ##k# CHECK--PREPAID *Kt* N00026 NATURAL GREEN, INC. SPRING START-UP MAINTENAN 42400-01 A4G2YI0.0000 1,863.42 DR455r-2O200 ACCOUNTS PAYABLE 1,863.42 CR455-•10100 CASH **** TOTAL VENDOR **** $ 1,863.42 2131 *i-** CHECK-PREPAID **** G00069 CiREENMASTERS, INC MAINTENANCE LAKE POINTE E 00425-01 A4O2YFO.0000 3,756.57 DR455-20200 ACCOUNTS PAYAILI 3,/56.57 CR455-10100 CASH *### TOTAL VENDOR k*$$ $ 3,756.57 2132 *** CHECK-PREPAID f### C00044 CASSERLY LAW OFFICE MAY LEGAL SERVICES 00426-01 A4G2XE0.0000 92.00 DR450•-20200 ACCOUNTS PAYABLE 92.00 CR450-10100 CASH JUNE LEGAL SERVICES 00426-04 A4G2XH0.0000 22.50 DR450-20200 ACCOUNTS PAYABLE 22.50 CR450-10100 CASH MAY LEGAL SERVICES 00426-02 A4l2XZ0.0000 180.00 UR455-20200 ACCOUNTS PAYABLE 180.00 CR455-10100 CASH JUNE LEGAL SERVICES 00426-05 A4G2Y20.0000 202.50 DR455-20200 ACCOUNTS PAYABLE 202.50 CR455--10100 CASH JUNE LEGAL SERVICES 00426-06 A4G2YNO.0000 292.50 DR45/-20200 ACCOUNTS PAYABLE 292.50 CR457--10100 CASH MAY LEGAL SERVICES 00426-03 A4G3030.0000 1,035.00 DR460-20200 ACCOUNTS PAYABLE 1,035.00 CR460--10100 CASH JUNE LEGAL SERVICES 00426-07 A403080.0000 2,049.00 DR460-20200 ACCOUNTS PAYABLE 2,049.00 CR460-10100 CASH ###a TOTAL VENDOR * $ 3,873.50 '133 **** CHECK-PREPAIL **** F00023 FRIDLEY, CITY OF MAY PERSONAL SERV/EXPENSE 00427-06 A4G2XKO.0000 367.12 DR450-20200 ACCOUNTS PAYABLE 367.12 CR450-10100 CASH MAY PERSONAL SERV/EXPENSE 00427-07 A4G2XN0.0000 550.60 DR450-20200 ACCOUNTS PAYABLE 550.60 CR450-10100 CASH MAY PERSONAL SERV/EXPENSE 00427--08 A4G2XU0.0000 30.01 DR450-20200 ACCOUNTS PAYABLE 30.01 CR450-10100 CASH MAY PERSONAL SERV/EXPENSE 00421-09 A402Y90.0000 737.32 DR455 20200 ACCOUNTS PAYABLE 737.32 CR455--10100 CAt.H MAY PERSONAL SERV/EXPENSE 00427-01 A4G30B0.0000 13,160.33 DR460-20200 ACCOUNTS PAYABLE 13,360.33 CR460-10100 CASH MAY PERSONAL SERV/EXPENSE 00427-•02 A4030J0.0000 11.65 DR460 20200 ACCOUNTS PAYABLE 11.65 CR460-10100 CASH MAY PERSONAL SERV/EXPENSE 004 /-03 A4003000.0000 103.58 DR460--20200 ACCOUNTS PAYABLE 7 103.58 CR460-1G10C+ CAS!: DATE 06/12i91 CITY OF FRIIDLEY - HRA PAGE. 2 PROGRAM P008 CHECK REGISTFR CHECK RUN BATCH # :0005 002 HRA VENDOR DISC. JOB DESCRIPTION INV # PO/INV # 6E0 # PC:NT AMOUNT ACCT NUMBER NMBR MESSAGES MAY PERSONAL SERV/EXPENSE 00427-04 A4630S0.0000 764.33 DR460-20200 ACCOUNTS PAYABLE 764.33 CR460-10100 CASH MAY PERSONAL SERV/EXPENSE 00427-05 A4G30X0.0000 10.00 DR460-20200 ACCOUNTS PAYABLE 10.00 CR460-10100 CASH **** TOTAL VENDOR *x-** $ 15,934.94 2134 **** CHECK-PREPAID► m* H00019 HERRICK & NEWMAN MAY LEGAL SERVICES 00428-01 A4G2XQ0.0000 850.25 11R450-20200 ACCOUNTS PAYABLE 850.25 CR450--10100 CASH MAY LEGAL SERVICES 00428-02 A4G2Y60.0000 63.75 DR4:15-20200 ACCOUNTS PAYABLE 63.75 CR455-10100 CASH MAY LEGAL SERVICES 00428-03 A402ZV0.0000 382.50 L,R457-20200 ACCOUNTS PAYABLE 382.50 CR457-10100 CASH MAY LEGAL SERVICES 0042B-04 A4G3OF0.0000 297.50 DR460-20200 ACCOUNTS PAYABLE 297.50 CR460-10100 CASH **** TOTAL VENDOR **** $ 1,594.00 2135 **** CHECK•-PRE,`'IAID **** ZZ0113 SHENEHON-GOODLUND-TAYI.OR, INC. APPRAISER FEES 00429-01 A4G2ZY0.0000 1,500.00 DR457-20200 ACCOUNTS PAYABLE 1,500.00 CR4S/-10100 CASH *** TOTAL VENDOR *#*a $ 1,500.00 **** TOTAL NUMBER OF C:HLCKS WRITTEN : 000000 **** TOTAL DOLLARS FOR CHECKS WRITTEN : $ 32,279.01 *n** LAST CHECK NUMBER : 00212E , ! ' 7 . 1 TO: FRIDLEY H.R.A. FROM: CITY OF FRIDLEY RE: BILLING FOR OPERATING EXPENSES FOR MAY, 1991 AND MAY 1991 ADMINISTRATIVE EXPENSES MAY ADMINISTRATIVE PERSONAL SERVICES 13, 108.08 MAY ADMINISTRATIVE OVERHEAD 252.25 TOTAL ADMINISTRATIVE BILLING 13,360.33 OPERATING EXPENSES: POSTAGE 11. 65 FIRST QUARTER COPIER ALLOCATION 103.58 LODGING & MEALS FOR BILL BURNS 764.33 APRIL FILING - HENDRICKSON 10.00 APRIL MANAGEMENT FEE - KORDIAK REALTY - RICE PLAZA 367.12 MAY MANAGEMENT FEE - KORDIAK REALTY - RICE PLAZA 550. 60 ELECTRICITY - RICE PLAZA 30.01 IRRIGATION SERVICE - NATURAL GREEN LAKE POINTE 737. 32 TOTAL OPERATING EXPENSES FOR MAY $2,574.61 TOTAL EXPENDITURES $15,934.94 7 . 2 • Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: June 21, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: University Avenue Signal Improvements at 57th and 61st Avenues At the HRA meeting on May 19, 1991, the HRA wanted to be informed as to the type of improvements that were going to be made at 57th and 61st Avenues in conjunction with MnDOT signal improvement project. The HRA authorized an expenditure of up to $40,000 in order to implement some of the recommendations that were contained in the University Avenue corridor plans prepared by Barton-Aschman. We still do not have a detailed line item cost estimate for each of the proposed improvements; we have not received that information from MnDOT as of yet. When we do receive it, we will provide that information to the HRA. However, we have identified what exists now at the intersections, and what the proposed plans will include. John Flora has written a memo with maps depicting each intersection. Again, the majority of the $40,000 will be expended on the internally illuminated street name signs ($20,000 - $30,000) . Street names signs are not indicated on the plans attached to Flora's memo. Existing at each intersection now are street lights at the southwest and northeast corners of the intersection. Under the new plan, two additional street lights will be installed at the northwest and southeast corners of the intersection. This was a specific element of the University Avenue corridor improvement plan. Further, the stamark pedestrian crossing indicators will be placed on all four legs of the intersection. This also was an identified improvement in the corridor improvement plan. Additional traffic signal facilities will be installed at the northwest and southeast corners of each intersection as well as in the medians. To summarize, a majority of the costs will be the internally illuminated street name signs and the remaining money will be for two additional street lights, electrical wiring for the signals, and additional signalization of the intersections. Again, we will return to the HRA with the detailed line item amounts after the project has been bid. BD/dn M-91-453 8 f.. `� Engineering y Sewer —' W he Water `0 CC O Parks T O 3 Streets _. U 0 Maintenance W—J ce m C.. a MEMORANDUM TO: Barb Dacy, Community Development Director PW91-153 FROM: - John G. Floral Public Works Director DATE: May 23, 1991 SUBJECT: T.H. 47 Signal Replacement Project At the HRA meeting of May 19, 1991, there was a discussion and approval to upgrade the University Avenue Signal System in conjunction with the MnDOT plan to incorporate the University Avenue Corridor theme. The University Avenue Corridor theme, not counting the red brick, landscaping, bus stops and shelters, calls for placing the push- buttons for pedestrian crosswalks at the various signals, traffic signals for all the various movements, and the installation of internally illuminated street name signs on the mast arms at the intersection. The attached schematics of the 57th and 61st Avenues intersections with University Avenue indicate in dark colors those new elements which are to be added to the signal system. In addition the proposal will also include the addition of the internally illuminated street name signs. This is based upon the assumption that MnDOT will shortly come up with a policy approving these installations. if you have any further questions in regards to what this addition entails, please let me know. JGF/ts Attachment William W. Burns c: s • IrtJ 1Y OF 8 . 1 FRlDLEY , • • 1 , I' 11•� - • ' �� R,��i'`c Fb;_....._ • k4ti f�;�, 61 s t Ave `._,. . 7{ fir' > a ;'�,:,,�',�.y�, • L 'y yy s: si''i*Kf..'1'' \ • /- ,ty;;,. i>/::::g'Ai ;; ....,...4.);:....,-,!...,..v. t4 a- ...� a� '. . .,F - � f iLS.• '• ' ffr r n _. ._ . s. L( •' � ..\ t ' t.i ,' ? o• ' hy o ` Xt1 + et •% Y �`��4j ki .' 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A :.• I MO '' HH i•1 1 , NE I i I REMOVE GUARD POSTS • A — A... (11..**-Yi:W . _....P tri)-1 '• • _,......—:„.., — • _- - . H H—5 STH 47 I . .., •.,.,...., : _-, .;......,.zta • t... • A 1 • . ...„ , •1,.. .. REMOVE GUARD ........_:-_,z:•:._-.,-., i 1 J i . , ; ••:•.!--,..7,----,.. -,-- -.!<, ,,-- :- - , i • , INE • A • ‘ 5 ..*",..'..0 4 t r.r.'•• ..?1,0 r;r Vio•.0'. 'fit'..y....: . , ../ ,1494101.:•13'.'..•*$ . ;ft. — ^ — 1 1 •.:... . —• " ••—• 1 1 t ii...fo...1.. .<;.:44:-‘); •'. •...5 , -., •••ggst*p .11 n _ _._. _ I I_ I I :1,1'4:N-, 4 4/7,0 Illifr* ' ,— . k•ltt: . 41?..liAt . Ai.; , i .z • - •it.- • ... • .,.-Niz.-5i'.',,,,, a- ' -11. - t ,,,,,,"J• b r-•-a• ' •,..>•,, .. -:f • .((7-S z ‘-k*AA P-11:4 ••••....,..% i A.:4---4,' :-.j......--ri.,.'4- I 1 • -1.47:t,-9,..,,,,..• .z.;P•...4t.1.4.Z. I '-- . 1 1 f - 8 .3 1 , r , CITY OF FRIDLEY MEMORANDUM TO: WILLIAM W. BURNS, CITY MANAGER FROM: RICHARD D. PRIBYL, FINANCE DIRECTOR PAUL S. HANSEN, ACCOUNTANT SUBJECT: SCHOOL DISTRICT REFERENDUM LEVY RETURNS DATE: June 19, 1991 Attached you will find a copy of the estimated 1992 School District referendum levy return amounts based on the attached copy of the estimated 1991 return amounts. The 1992 return agreements are not included but will be submitted to the HRA commission members at a later date for discussion and approval. The estimated total return amount for 1992, before delinquents, is $376, 061.10. This is an increase of 14% from the 1991 estimated return amount, before delinquents, of $330,207.52. In the March 28, 1991, memo attached we estimated a 20% increase in the return amount based on an projected increase in market value of approximately 20% and projected all other factors would remain constant. However, all other factors did not remain constant. Class rates were lowered by State legislation which will have a negative impact on tax increment received for payable 1992 and the years to follow. In total the increase is estimated at 14% but, per each individual School District the percentage increase varies greatly. Below shows the estimated 1991 amounts, estimated 1992 amounts, and the percentage increase/(decrease) : School Estimated Estimated Percentage District 1991 amounts 1992 amounts Increase/(Decrease) 11 $ 15,852.91 $ 17,876.25 13% 13 $ 29,652.37 $ 26,877. 31 (9%) 14 $225, 087.09 $271,516.41 21% 16 $ 59, 615.15 $ 59,791. 14 0% The reason the amount due to School District #14 increased by 21%, even though the class rate decreased, was due to the increase of market value of the Northwest Racquet & Swim Club from $5,479,300 to $12, 395,900. Each School District should be aware that these are our best estimates at this time. The market values could be reduced through court decisions, abatements or by other means. Also, delinquents averaged approximately 9% in 1990. 9 • N CO Z 000 c0 N QD >:W � co COC CO v Q N N CO CO n Z: C) C) C7 CO. 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N O 0) U) 1-- (0 O) N (NI O N ap n 0) O co r CD U) U) CO 0) Cp r r N CO r h r O) N r r N H '` ''+::;::> =% 0) CO 0) 0) ... CO CO CO U) COa C0) C.416 COO CO Q Q Q `::::: • ,:,;fly.; CV CV (Ni CV Z U) N U) tO U) t0 (O (D Z Z Z :s:?il,t : :: EV si•:+k:'::•..i• N 0 o 0) CONCOO v- 1.0 O t N O 01 O 'L';W:: ;N? n1 N CO CO r d- n CO CO r N U) N CO Z :Q:``ii' n N (0 O r n N (0 O r N r r N ig. U) r r U) r sr .- N. N r cc m mto nt Y Y giaiginif N CO co C m O m m m m m m t m o .c Z ii'.:g 1. c c o c o c c o c o C = h `c (v r W UUM -3 () OUM "3CCO ZZO OZ U. i uJ r r N �t CD r r N st CO 0 M U) N. 0) Or U * * * * * 4U * * * ft * qt * ft 4k ------------- Q Q z Z a J O 't m -J W I * m = m m 0 —U :::::;ia:: to a - 2 W :: :'Z (O N 1- to (0 Xi ?. 0 CO (0 N. 5 CO 3>::1L:: J tb CO CO J lL CO CO CO `'' N N N 0 N U0) 0) co U °) CO 9 .5 CITY OF FRIDLEY MEMORANDUM TO: HRA COMMISSION MEMBERS FROM: RICHARD D. PRIBYL, FINANCE DIRECTOR PAUL S. HANSEN, ACCOUNTANT SUBJECT: SCHOOL REFERENDUM LEVY REFUNDS DATE: March 28, 1991 This memo is in response to the HRA commission's question at the March 14, 1991 HRA meeting as to whether or not we could calculate the payable 1992 referendum levy return amounts by July of 1991 instead of December. Assuming we receive the applicable tax information from the county in April or May we could have actual payable 1991 amounts by June of 1991. Therefore, at that time, we could ESTIMATE payable 1992 return amounts based on the payable 1991 amounts plus a possible increase of 20% (see attached projections as presented in a previous meeting) . These amounts are only ESTIMATES and would be affected by delinquent taxes, State legislation, or any unforeseeable increases or decreases in overall property values. This matter will be brought up for discussion at the June, 1991 HRA meeting. So, in July a timely decision in regards to the referendum levy return amounts can be given to the School Districts. 9.6 • 0C > O X N (On a QC C) O = O (/j p D Q'+ c�i� �° m c c m �' < CO v -0 m 70 Cr) ov o -I r 0 O Z Z - y 0 0 2 O0 i O T 0 -v m 0 3) CD (- 0 _I m m 3 a o. DD rr- m C G) D � Oi nm n o. r- 09 „xi Zo 0 n m m Z go O o w (n m i m o M 0 n to • C co > o o 6 69 0i m -4 -, Z > Z Z Z f F N 69 69 69 W N N 69 Oo .-I m o _(oo a z O z z O m m o 0 o ccn can w CO CD rn 0 -Zi > CO wC m m m _ 0) o u, N v, 0) n 0 o In co m m Q o o Co Co in g < D o Z to c ) o 0 0 0 0 0 a 0 -n 0 -I 33 -13 74 m r O 11 _ - fA D m m 69 69 co Z `O o � 69 w m 69 69 fn 'Z m N oD �) v ,69u O � Cm� (Vn CO DiOn V C co OO O COC O I C) -, cn N N N A j m D 0 fn V CO Co CD CO CD to C C : w coil 0W) S CO 0) < '- O "' N O pD V 0) to1 < O 0 0 0 o tr- o 0 o m o Co 0 0 b 0 0 o co m Z a a a -•ro 0 0 a o a o a a O 3 o Z w m Cl, 69 m W •W D (D E. E. -• W EA o X O N WQD A V D 69 A V Q. 0 O 69 EA A 69 N c 0 D CO U) V In N (. 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V Co o go > D CO CA N > W COO W W co N V Wgo N O O -CO CO '"� O O (n 3 CO CD O O A O N V A D co '-I cn 0 0 0 0 O O O (71 CoO CAO 0) O cVn (Un O o _ N Q to co CO VCO (0 N -u 'U 69 69 _, 69 69 69 W N N N iv CA V V A iv000U > 0 0p o nA) o rn o 01 o 0 0 < < D 0 0 0 0 n) m 0 0 0 O 0 b 0 0 (O.) m 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 p iv D N m 69 --I 69 a D Cn N 69 69 69 69 N 69 69 69 A 69 CWn - Rd CO CO A n) x (D w w rn • y D A WN V co A A _ N C7 C) O N N cNii co W W co A N CJl W ...I --,, Cn O O Co Co V > n N W N co A V A a) a) A Cn _ m (n O 0 O O 0 O (on CD W VO O O O 0 9 . 7 ISII #14 FRIDLEY TEL No .612-571-7633 Jun 19 ,91 13 :33 No .001 P .01 INDEPENDENT SCHOOL. DISTRICT NO. 14 OH ULNNISI 11LNS 6000 WEST MOORE LAKE DRIVE. FRIDLEY.MINNESOTA 5543? / 571-6000 fAX 612-571-7633 June 19, 1991 Dr. Bill Burns, City Manager City of Fridley 6431 University Avenue NE . Fridley, MN 55432 Dear Bill : My understanding is that the HRA will soon be considering the tax increment finance issue for the 1992-93 School District budget year. First of all let me thank you and the HRA for putting this issue on your agenda in a timely manner. By making a decision on this now, you do provide us the opportunity to factor your decision into our budget planning process. Also, let me again thank the HRA for their past decisions related to turning all school referendum dollars captured within the tax increment districts back to the local School District. These dollars have helped us to maintain and develop quality programs for students. With respect to your impending decision regarding the amount to be returned to the School District in 1992-93 , I would hope that the HRA would take into account some unusual legislative action during this past session. As I believe you are aware, District 14 intended to hold a tax levy referendum in November of 1991 to generate increased revenue for the 1992-93 school year and beyond. This revenue was to be used to maintain current program as well as to enhance programs in certain areas. Unfortunately the legislature passed a bill which placed a one-year moratorium on referendums. This action coupled with the passage of a school aids bill that provides only a 1% increase in revenue in 1992-93 places the District in a very difficult position. Not only do we receive no new revenue, but our potential access to new revenue is also eliminated. My hope is that as the HRA considers their direction with respect to 1992-93 tax increment dollars, they will also consider the unusual circumstances the School District faces during that particular budget year. Thank you for your past support and for the continued opportunity to be heard. • Sinc ely __-------- - 4/ • ttansmi rt►em tax o 7C1 Dennis E. Rens, PhD post-w"brand - Superintendent vivey - �r�/ _ 6 p p 0 DER/hj Dept• , HURNSTIF.WPS 9. 8 I •J 1 / Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: June 21, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Update on Fridley Town Square Project Attached is a memo from Jim Casserly regarding the current status of the above-referenced project. Casserly refers to a potential tenancy by Dairy Queen instead of Burger King. I spoke with Don Fitch on June 20, 1991 and he is considering moving to the Fridley Town Square, only if he can have a separate pylon sign. I reviewed with Fitch, and am in the process of contacting Scott Ericson to review with him what the sign ordinance would require for the property. We will also be working with Fitch in the near future to work out a potential lease arrangement such that when we take ownership on July 25, 1991, the lease will be in place with Fitch. This will be scheduled for HRA's July 11, 1991 agenda. BD/dn M-91-449 10 Casserly Molzahn & Associates, Inc. 215 South 11th Street, Suite 200 • Minneapolis • Minnesota 55403 Office(612)342-2277 • Fax(612)332-4765 MEMORANDUM TO: City of Fridley Vi,Ziliam Burns arbara Dacy FROM: James R. Casserly DATE: June 18, 1991 RE: Town Square Project I spoke with Patrick Wooldridge, the underwriter at Miller & Schroeder, who has been arranging the construction financing on this project for Scott Ericson. Mr. Wooldridge told me the following: 1 . Scott Ericson has secured a stand-by permanent loan from U.S. Life. 2. That Scott Ericson has deposited certain sums with Miller & Schroeder in order to complete the financing. 3 . A representative from U.S. Life will be in town the week of June 17th to do a site inspection. 4 . Dairy Queen is proposing to use 2, 400 square feet (where Burger King was to have been located) . The lease with Dairy Queen has been under negotiation for some time and an execution of the lease is expected in the near future. 5 . Final commitments from Miller & Schroeder and U.S. Life should be forthcoming by the week of July 15th. Once Scott Ericson has received the final commitments, we should then conclude the negotiations on the development agreement and submit the development agreement to the HRA for its approval. I will let you know as soon as I have heard anything further. JRC/db 10 . 1 �'(�y, ,�+ & ��/y�\ HERRICK NE Y MAN ATTORNEYS AT LAW Virgil C. Herrick MEMORANDUM James D. Hoeft Gregg V. Herrick Of Counsel David P. Newman TO: Barbara Dacy FROM: Jim Hoeft DATE: June 7 , 1991 RE: Dairy Queen Acquisition This is to provide you with an update as to the above referenced matter. Please note that the Anoka County District Court has approved the transfer of title and possession to the property under the quick take provisions, subject to the expiration of the 90 day waiting period. The effective date of transfer will be July 25, 1991. The Court also appointed all of our recommendations for commissioners, those being as follows: 011ie Erickson, Harvey Peterson and Albert Kordiak, with Richard Erickson and Marlin McCready as alternates. The first meeting of the commissioners is scheduled for Monday, June 17 , 1991, at which time the commissioners will be sworn in and will discuss the further scheduling of the commissioners ' hearing. As soon as we receive notice of the date of that hearing we should contact Denny Taylor as to his appraisal and testimony thereon. JDH/lal 10 . 2 Suite 205, 6401 University Avenue N.E., ('ridl<.)•. ":linnesota 55432, 612-571-3850 4 .a /4 • nt Community Development Department \ HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: June 21, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Update on Mississippi Street Improvement Project Consistent with City Council and your direction, I have arranged to have an informational meeting by the Anoka County Public Works Department and the City regarding the Mississippi Street improvement project for property owners and tenants immediately affected by the project. The meeting is proposed to be held on July 8, 1991 at 7: 00 p.m. in Meeting Room 1 of the lower level of the Fridley Municipal Center. We have notified all persons, property owners and tenants, from 5th Street on the east side of University Avenue to 2nd Street on the west side of University Avenue. Jon Olsen from the Anoka County Public Works Department has advised us that they have not received a signed permit/agreement from MnDOT regarding the project as of yet. He stated that depending on when Anoka County receives the agreement, they are hoping for a July bid opening with constructing beginning in August. Olsen stated that the project would probably last about ten weeks. The HRA commissioners are invited to the meeting. Tenants of the Rice Plaza building were invited as well as the tenants of the Holly Shopping Center. Councilman Billings is also meeting with representatives from the Fridley Covenant Church and a homeowner from Satellite Lane regarding the City's construction of a temporary road from Satellite Lane to Mississippi Street. This road would remain until the property is redeveloped. Its purpose is to permit people in the Satellite Lane neighborhood to make left-hand turns onto Mississippi Street in order to head toward East River Road. BD/dn M-91-443 11 b