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HRA 01/10/1991 - 29617� � /"� CITY OF FRID7�EY HOIIBING{ & REDEVELOPMENT AIITHORITY MEETIN(�, JANUARY 10, 1991 ..��..��....�..���»����..�..�����..����....�..���..��........�..�..��..���..�..������� CALL TO ORDER• Vice-Chairperson Schnabel called the January 10, 1991, Housing & Redevelopment Authority minutes to order at 7:40 p.m. ROLL CALL: Members Present: Members Absent: Virginia Schnabel, Duane Prairie, John Meyer Larry Commers, Walter Rasmussen Others Present: William Burns, Executive Director of HRA Barbara Dacy, Community Development Director Jim Hoeft, HRA Attorney Rick Pribyl, Finance Director Paul Hansen, Accountant Steve Billings, City Councilmember Jim Casserly, Development Consultant Terry Moses, BMB Realty Investmen�s Ray Wormsbecker, Caba Realty Doug Erickson, Fridley Focus Lisa Williams, 2742 Hennepin Ave. S. APPROVAL OF DECEMBER 13, 1990 HOUSING & REDEVELOPMENT AUTHORITY MINUTES: MOTION by Mr. Meyer, seconded by Mr. Prairie, to approve the December 13, 1990, Housing & Redevelopment Authority minutes as written. IIPON A VOICL VOTE� ALL VOTIN(3 AYE, VICE-CHAIRPER80N SCHNAHEL DECLARED THE MOTION CARRIED IINANIMOIISLY. APPROVAL OF AGENDA: Mr. Burns stated he would like to add an item, Lake Pointe Maintenance, to the agenda under "Action Items". 1. RMS DEVELOPMENT AGREEMENT Mr. Burns stated that at this meeting, the HRA is being asked to consider a proposal to return 50� of the value of outstanding assessments for public improvements to RMS Company. These assessments are for projects involving street widening, resurfacing, and the construction of a storm sewer. A lot of this occurred on Commerce Lane in 1989 and 1990. It � HOIIBINa � RBDEVELOPMENT AIITHORITY MEETINa JAN. 10, 1991 PA�3E 2 � also involved some storm sewer work on Main Street in the vicinity of this property. Mr. Burns stated the RMS Corporation is a manufacturer of parts for the aircraft industry and large companies requiring other precision metal parts. RMS currently employs 248 people at four different locations: Baker Street, Osborne Road, 81st Avenue, and 2,500 sq. ft. location at the Martens/Brenny building on 83rd Avenue. Mr. Burns stated RMS plans to purchase a 8.9 acre site at the northwest corner of Osborne Road and Main Street. The preliminary plan is to construct a 70,000-80,000 sq. ft. building which will cost an estimated $4-5 million. Total taxes on the property are estimated at $2.75/sq. ft. or $206,225. The local share of that will be $33,000. The new consolidation of the three facilities will create 50-75 new jobs; and if another company is included as part of a buy-out, there would be 140-150 new jobs. Mr. Burns stated RMS is a privately held subsidiary of Cretex Corporation in St. Cloud, Minnesota. They expect another division of Cretex to move to the 12,000 sq. ft. facility on Osborne Road. Mr. Burns stated there are several justifications for the HRA spending the approximately $40,000-50,000 to RMS: 1. The project is consistent with the objectives of the HRA's redevelopment plan for the subject area. 2. The assistance will enable the City to retain 250 jobs and create another 50-75 jobs. 3. The property tax benefit ($33,000 per year) is supposed to cover the cost within two years. 4. The proposed level of assistance is about 1-2� of the total construction value. Mr. Burns stated Jim Casserly has drafted the development agreement, and he would like Mr. Casserly to review some of the details of the development agreement with the HRA. Mr. Casserly stated the development agreement handed out at the meeting is the latest version. He stated the two kinds of changes made were at the request of RMS and its legal counsel: ^ 1. RMS wanted to make it very certain that the company was not obligating themselves to build a building � HOII8IN�3 & REDEVELOPMENT AIITHORITY MEETINa� JAN. 10. 1991 PAGE 3 right now, and they understand they will not receive any assistance if they do not build a building. 2. Because they are still in the design and planning stages, they really wanted to give themselves a little more leeway for the size of the building. Legal counsel has said they have not yet determined the final size of the facility, and they did not want to be limited to a certain size. Mr. Casserly stated he put in the agreement that the building size has to be at least 50,000 sq. ft. and have a value of at least $2 million. Mr. Casserly stated it is a very straight-forward development agreement. He stated there is also a two page resolution, and there are no changes to the resolution. Mr. Meyer asked if there is any history where the HRA has aided a developer by paying a portion or all of the special assessments. Mr. Burns stated he believed the f�tA paid for the special assessments on the west side of the Moore Lake Commons project � for either street improvements or public utilities. This is not the first time the HRA has done this. Mr. Casserly stated another obvious example would be the Lake Pointe property where, instead of doing special assessments, they used a tax increment approach for all the infrastructure. Ms. Schnabel stated she appreciated knowing that the HRA has given similar assistance in the past. Initially she had spoken against this development's support only from a philosophical standpoint, not from a standpoint of not wanting the development. Her philosophical approach was that the property has not even been purchased yet, and there is still time to negotiate that assessment between the parties that are involved, the buyer and the seller. Knowing that the HRA has provided this type of assistance in the past put it in a different perspective, and she is more comfortable with it. Mr. Terry Moses, a consultant for RMS, stated there is some concern about the timing of the construction. Mr. Forcelle, who is President of RMS Company, has said he wants to build as soon as possible, and all indications are that construction will start this year. Since RMS is owned by Cretex, Mr. Forcelle could be overruled, but he does have a lot of influence. � MOTION by Mr. Meyer, seconded by Mr. Prairie, to approve Resolution No. HRA 1-1991, "A Resolution Authorizing Execution � � � SOIISINa � REDEVELOPMENT AIITHORITY MEETINt3. JAN. 10. 1991 PAGE 4 2. 3. and Delivery of a Contract for Private Redevelopment By and Between the Housing and Redevelopment Authority in and for the City of Fridley and RMS Company". IIPON A VOICE VOTE, ALL VOTIN(3 AYE, VICE-CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED IINANIMOIIBLY. Ms. Schnabel stated the HRA appreciates the fact that RMS is going to stay in Fridley, and they hope this assistance will encourage that development to proceed very quickly. Mr. Moses thanked the HRA and stated he would convey that message to Mr. Forcelle. Mr. Casserly stated he wanted to point out that this is the first time the HRA has assisted a project without creating a tax increment district. So, all the value that is being put on it will be received by the taxing jurisdictions. Councilmember Billings stated that it might be a good idea for the HRA to send a letter to the City, County, and school districts informing them that the HI2A just committed money to a project that they will not recover through tax increment. This project is in Spring Lake Park School District #16. Letters should also be sent to Representative Wayne Simoneau, Representative Alice Johnson, and Senator pon Frank. Ms. Schnabel stated Mr. Billings' point is well taken. If the other members agree, she would ask staff to write the appropriate letters. Mr. Prairie and Nlr. Meyer agreed. RESOLUTION DESIGNATING OFFICIAL DEPOSITORIES FOR FRIDLEY HRA: MOTION by Mr. Prairie, seconded by Mr. Meyer, to approve Resolution No. HRA 2-1991, "Resolution Designating Official Depositories for the Fridley Housing and Redevelopment Authority". IIPON A VOICE VOTE � ALL VOTIN(3 AYE � VICE-CHAIRPERBON SCffiJABl�L DECLARED THE MOTION CARRIED IINANIMOIIBLY. CLAIMS {2090-2094): MOTION by Mr. Meyer, seconded by Mr. Prairie, to approve the check register as presented. IIPON A VOICE VOTE, ALL VOTING AYE, VICE-CHAIRPERBON SCHNABEL DECLAR�D THE MOTION CARRIED IINANIMOIISLY. � HOII8IN�3 & REDEVELOPMENT AIITHORITY MEETIN(�i, JAN. 10. 1991 PAGE 5 4. LAKE POINTE MAINTENANCE: Ms. Dacy stated that the Public Works Department notified them of three issues pertaining to the maintenance of the Lake Pointe property. The HRA currently pays for an annual maintenance contract for lawn cutting and other trash pick-up on the Lake Pointe property. These three items are in addition to that cost. 1. Mr. Winson, Assistant Public Works Director, has pointed out that the Public Works Department would like to execute an annual fertilization and tree pruning contract. They would like the HRA to include funds in the 1991 budget to do those activities. After getting some preliminary estimates from a landscape contractor, Mr. Winson has told her that the cost could be as high as $7,500. She would like the HRA to authorize that $7,500 be included in the 1991 budget for that expense. They would go out for bid for that particular activity, so the cost could be less. 2. Twenty trees on the Lake Pointe property have died within the last year. The warranty period the HRA retained for landscaping has expired, and if the HRA replaced all 20 � trees, the maximum cost would be $12,960. After discussing this with the City Manager, Mr. Burns, it is staff's recommendation that the HRA not expend that money and that it is possible a number of these trees could be replaced by virtue of development on the property. The City recently passed a new landscaping ordinance that will require developers to plant extensive landscaping. At this point, the number of dead trees is still minor and is not affecting the overall appearance of the site. 3. The third item pertains to the underground irrigation system to maintain all the landscaping. The Public Works Department says that from time to time, maintenance issues may arise for the underground irrigation system. Currently, staff is preparing a 1991 budget and is looking at allocating about $10,000 for a"just in case" provision if something should happen. Ms. Dacy stated that at this meeting, the only action necessary is for the HRA to authorize the City to go out for bid for an annual fertilizing and tree pruning contract not to exceed $7,500. Mr. Meyer stated he did not know the status of the lawn and sodded areas or if there are any weeds or crab grass. He knows � what weeds can do to expensive lawns, and he hoped that they are watching that closely. He would appreciate staff checking to make sure that the contract for lawn maintenance includes �._ HOIIBINa_& REDEVELOPMENT AIITHORITY 1KETsTINa JAN. 10. 1991 PAGE b fertilizing and weed control in order to preserve the expense they have put into that lawn. OTION by Mr. Prairie, seconded by Mr. Meyer, to approve and authorize the City to go out for bid for a fertilizing and tree pruning contract not to exceed $7,500. IIPON A VOICE VOTL� ALL VOTING AYE� VICE-CHAIRPER80N SCHNABEL DECLARED THE MOTION CARRIED ONANIMOIIBLY. 5. TARGET PROJECT: Ms. Dacy stated First Western Equity Corporation is interested in constructing a 126,500 sq. ft. shopping center at the southwest corner of 85th and University Avenues. In conjunction with that shopping center, they are also working with Dayton-Hudson Corporation to locate a 117,000 sq. ft. Target facility at that site. Ms. Dacy stated the developer has made applications for variances, a rezoning, and a plat. The status of the applications is that the developer wants to go through the variance process first to receive direction from the Council for one specific variance, and that is the parking stall r� width. The developer is requesting a 9 foot wide space. The City ordinance dictates a 10 foot wide space for commercial development. That issue is so important to Dayton-Hudson and the developer that they want to determine whether or not that would be granted before they proceed with other parts of their applications. Ms. Dacy stated the variances will be going to the Appeals Commission on January 22, and then to the Council in February. It will take about 2-3 months for the developer to finish the rest of their development approvals. Staff has raised some questions about traffic and storm water quality and has requested some specialized studies. Ms. Dacy stated staff inet briefly with the developer in December regarding soil correction assistance from the HRA. Staff gave them the new application forms and the policies used by the HRA for that type of assistance. The developer has not indicated any dollar amount or the amount of their request at this time. Ms. Dacy stated there is about 4 acres of wetlands on tY�e property right now located approximately in the northwest corner of the site and is the area where they will be putting their stormwater management pond. Obviously, the area where the shopping center is to be located will destroy the wetlands �' site. The developer has received an Army Corps of Engineer's permit based on the fact that they are required to recreate �r , �"� �._ HOIIBINa & REDSVELOPMENT AIIT80RITY MEETINa� JAN. 10, 1991 PAaE 7 6. another wetland elsewhere in the community. That site is the Meadowlands Park site just north of Mississippi Street. The Army Corps appears to be happy with the plans prepared for the Meadowlands Park site. The Army Corps is still reviewing this particular development plan. Ms. Dacy stated there is a substantial amount of peaty soils on the property right now, as deep as 3-4 feet in some places. A lot of excavation work will be necessary and a lot of clean fill will be needed to be placed on the site. Ms. Dacy stated she had originally anticipated an application from the developer as soon as the February HRA agenda, but that does not appear to be the case. This information is just to make the HRA aware that First Western Equity Corporation may apply for soil correction assistance. Mr. Meyer asked what affect this development would have on the Springbrook Nature Center. Ms. Dacy stated the developer made a presentation to the Springbrook Nature Center Board on December 17, 1990. The Board�s main concerns were the impacts from the shopping center lights as well as the quality of the water runoff from the property. Another issue that has come up since that meeting is that because of the high water table in the east part of the site, the Board is wondering how construction will affect the water table into the park area. The Board wants to make sure the Nature Center's integrity is maintained in terms of night programming and that the water quality is not degraded any more than the runoff through the park right now. Mr. Meyer stated he would be very concerned about the water runoff that would contain oil and gas from the development into Springbrook Nature Center. UPDATE ON UCD PROJECT: Mr. Burns stated that at the last HRA meeting, they talked about a development agreement with Fridley Town Square project. Since that time, they have had continual concerns about the addition of a Burger Ring proposed by the developer, Scott Erickson. Staff has pointed out to the City Council that the addition of a Burger King will substantially increase peak hour traffic (between 4:30 - 5:30 p.m.). As a result of additional traffic, there is the potential for creating stacking problems on Mississippi Street for eastbound traffic that wants to turn left into the center. There is also the potential for undesirable traffic impact behind the shopping center. Staff has noted the possibility of loud mufflers and other vehicle noises and the impact of those things on the neighbors. There is also a potential conflict between the � HOIIBIN(,4 & REDLVEI�OPMENT AIITHORITY MEETINm. JAN. 10. 1991 PAGE 8 , � traffic using the Burger Ring moving behind the shopping center and those that are loading and unloading, particular at the Walgreen store. Mr. Burns stated the staff has discussed these concerns with City Council, and basically the Council members are not supportive of the Burger King addition unless there is a way to mitigate the impacts of the additional traffic. About the only way staff sees to mitigate the problem is to buy the property next door and move the driveway down. That is very expensive and something that the Walgreen Corporation would not approve. Mr. Burns stated that in view of the mitigation problems and Council's position on the Burger King addition, Mr. Erickson was urged to find a new tenant or a new project. Mr. Erickson has requested that he be allowed to have a public hearing that is available to him under the S-2 chapter of the zoning ordinance which says that any time there is a major change in the plan for a redevelopment district, the Planning Commission has to have a public hearing, and the plan change has to be approved by the Planning Commission and the City Council. Mr. Burns stated that after consulting Virgil Herrick, City ,� Attorney, about Mr. Erickson's request, staff developed the following schedule of events: 1. January 7, 1991: Informal review of the situation after the Council meeting. 2. January 10, 1991: Informal review of the situation at the HRA meeting. 3. January 23, 1991: Public hearing on the proposed change before the Planning Commission. 4. February 11, 1991: City Council consideration of the proposed change. Mr. Burns stated the Council has opted to consider a major chanqe requiring a hearing before the Planning Commission and to follow the calendar (above). Mr. Burns stated that as far as the HRA is concerned, Mr. Erickson had requested tax increment assistance for his project. They would have had a tax increment agreement before the HRA at this meeting if the addition of the Burger King had not arisen. Does the HRA now want to bear the cost of proceeding with the draft of the development agreement for the � Fridley Town Square project, or does the HRA want to wait ' until the Burger Ring problem is ironed out? If the HRA wants to proceed with the draft of the development agreement, then ^ 80II8IN�3 & REDEVELOPMENT AIITHORITY MELTINa� JAN. 10. 1991 PAGE 9 does the I�2A agree in concept with the equity participation agreement discussed at the last meeting? Mr. Burns stated it is staff's recommendation that the HRA hold up on the development agreement and not spend any money at this time to have it drafted until the Burger King issue is resolved. Ms. Schnabel stated they should at least hold up on the drafting of the development agreement until after the Planning Commission public hearing. If the Planning Commission and City Council do not vote in favor of it, then it is over. Mr. Prairie stated the HRA is very concerned about the traffic, and he thought anything that would add more traffic to that site is a negative. Mr. Meyer stated that when this was discussed with the traffic consultant, the consultant said that any additional traffic would change it from a D to an E intersection. That is getting pretty bad. The Burger Ring addition is definitely a negative. Mr. Meyer stated that when the developer was before the HRA � with the project originally, he assured the HRA that the neighbors on 67th Avenue would not be jeopardized by the development. Now he is introducing a Burger Ring that will bring vehicle noise, loud speaker noise, extra lights, etc., and now they are impinging onto the residential nature of that street more than before with the center as first proposed. Mr. Casserly stated the City Manager has the prerogative that if the Council moves on the land use decision, he can authorize Mr. Casserly to move on the development agreement very quickly. 7. UPDATE ON RICE PLAZA: Ms. Dacy stated that in November, the HRA members made a motion to approve rent forgiveness for Terrie Mau of the Cinnamon Skin Tan with the stipulation that when she moves, she moves only to the Fridley Town Square development. Mr. Rordiak is still pursuing with her the money that she owes. Her slow season is in the fall months, Sept.-Dec., and her business picks up during the winter. He feels confident that she will keep current. However, if the Fridley Town Square development does not go through, then Ms. Mau still has to pay what she owes the HRA. ,,�,e Ms. Schnabel stated she appreciated the update. She stated ' she was surprised that she had voted in favor of this rent forgiveness, because she had spoken against it in the past. r,-, HOIIBING & REDEVELOPMENT AIITHORITY MEBTIN�3. JAN. 10. 1991 PAGE 10 Because of her concern, she would like to see this type of report on a month-to-month basis. 8. APPLICATION FEES AND PROCESS; Ms. Dacy stated that at the July 19, 1990, meeting, the HI2A discussed their policies and procedures for assisting with tax increment financing. Out of the discussion and out of the materials Mr. Robertson had prepared, she developed three handouts that staff will give to developers. These materials were included in the agenda packet and consisted of the following: 1. Policy statement regarding TIF administrative costs including the statement of fees. 2. Agreement for which the developer would execute with the HRA for an application. 3. A three page application form 9. INFORMATION REGARDING PAST HOUSING REHABILITATION PROGRAM: Ms. Dacy stated the information included in the agenda was ,� self-explanatory. Later in the meeting, Mr. Burns will be talking about some of the research staff will be doing for other housing programs for the 1990's. Ms. Schnabel stated that at other meetings she has brought up the possibility of creating a pool or fund that could be used in a manner such as the way the Habitat for Humanity program operates. She is curious about their process and how their applicants are screened. Maybe they should obtain some information from the Habitat for Humanity program as there might be something in their screening process that would be of assistance to the HRA. Ms. Dacy stated she has worked with two builders for that program, and she would be happy to contact them and see if she can get some information. 10. FRIDLEY OFFICE PLAZA BUILDING: Mr. Burns stated he has been contacted by Mr. Dan Cardona, a representative of a group planning to purchase the Fridley Plaza Office Building for approximately $850,000. Their request was that the HI2A consider a tax reduction on this property and also give them a better price on the parking ramp. The HRA has an agreement with the office building to � provide parking at $800/month. ,,� HOIIBINl3 �_REDEVELOPMENT AIITHORITY MEETING. JAN. 10. 1991 PAGE 11 Mr. Burns stated Mr. Cardona requested a copy of the development agreement, along with the second subordination agreement for the second mortgage and the agreement on the rental of the parking. He had indicated to Mr. Cardona that the City thought it was the petitioner's responsibility to make a case for his claim; and that he was welcome to state his case to the HRA. Mr. Burns stated he has not heard from Mr. Cardona since that time. He has also heard that this group is no longer pursuing the purchase of the office building, so the issue is moot at this point. Mr. Burns stated there are a couple of other issues that are related to the office building that he will discuss under "Other Business�� . 11. STATUS OF TAX COLLECTIOAIS FOR VARIOUS TAX INCREMENT PROJECTS: Mr. Burns stated that when staff looked at the tax increment turnback for the schools, he had suggested that the amount they were turning back was probably going to stabilize as the taxes for various projects in tax increment districts start to come on line. In a discussion after the last HRA meeting, ,� they decided it might be worthwhile to look at what taxes had originally been projected for the various projects, what proj ects have come on 1 ine, and what proj ects have yet to come on line. In the material given to the HRA, they could see that it will be a another year or so before the remaining taxes for the Moore Lake Racquet, Swim & Health Club come on line. That is the biggest project yet to come on line, so there should be another big jump in the next couple of years. However, there have been some tax devaluations for other projects. The Fridley Plaza Office Building is an example. Mr. Burns stated the table included in the agenda packet gives a good overall view of potential project revenues which may have a bearing on the TIF turnback to the school districts. 12. 1991 BUDGET: Mr. Burns stated he had hoped to have the 1991 budget ready to distribute at this meeting. Staff is still working on it, and it will be available for the February 14, 1991, meeting. 13. OTHER BUSIIJESS: a. Medtronic Mr. Burns stated he recently had a luncheon meeting with representatives from Medtronic. Medtronic is talking � HOIIBINa � REDEVELOPMENT AIITHORITY MEETINa� JAN. 10. 1991 PAGL 12 about two proj ects--a neurological center and an addition to their technology center. Mr. Burns stated that in order to produce the neurological center, Medtronic is going to combine three groups--one in California, one in Canton, Ohio, and one in Columbia Heights. They are looking for 40, 000 sq. ft. They have identified three sites and want to identify the final site within one week. One site is the East River Road Business Park. The new facility would create 40-60 new jobs with the consolidation, with a total of 100 jobs. Medtronic will ask the City to apply for economic recovery funds, a low interest loan program for companies that employ at-risk individuals. They will not be asking for any tax increment financing or other HRA assistance. Mr. Burns stated Medtronic is very seriously talking about building a 90,000 sq. ft. addition to their technology center (the building on the east side of Central Avenue). At this point, Medtronic is not asking for tax increment financing, but they do want to avoid doing a new environmental assessment. They did an environmental assessment in October 1980. According to Medtronic, the MPCA is happy with the 1980 environmental �"� assessment unless the City requests another one. He stated he needs to respond to Medtronic about this as soon as possible. Mr. Burns stated that as an alternative, he has promoted the Lake Pointe site to Medtronic, and they seem interested in the site. Medtronic has agreed to send the HRA a written request for proposal asking the HRA to tell them what the HRA would provide on the Lake Pointe site. Before sending the written request for proposal, they will identify the amount of space they need for the 90,000 sq. ft. building, as well as the amount of space they might need for future campus. Additionally, they are going to list other uses that might go on the Lake Pointe site. b. Lake Pointe ldegotiations Mr. Burns stated that before Christmas, Ray Haik, Virgil Herrick, Jim Casserly, Barbara Dacy, Jock Robertson, and he met to discuss the nonpayment of taxes on Lake Pointe by Woodbridge. They decided the City is not going to pay the taxes and would eventually claim tax forfeit or acquisition through the tax forfeiting process. Mr. Burns stated the bigger question that they discussed '�` was what are they going to do with Lake Pointe. They have identified four options: ^ HOIIBINd be REDEVEIAPMENT AIITHORITY MEETIN�� JAN. 10, 1991 PA(3E 13 1. Let Woodbridge buy the HI2A out. 2. The HRA buys out Woodbridge. 3. They negotiate a new development agreement, based on today's market. 4. They do nothing. Mr. Burns stated they decided it might be worthwhile in 1991 to pursue option #2. On December 21, 1990, Jim Casserly sent him a memo asking for authority to begin discussions with John Utley, the attorney representing Woodbridge, about a negotiated buy-out. Mr. Casserly will be coordinating these discussions closely with Mr. Burns. c. TIF Turnback to the School Districts Mr. Burns stated that at their last meeting, the Council tabled any action on the TIF turnback until January 28, 1991. Fridley School District Chairperson, Jim Ferguson was at the Council meeting and spoke strongly in favor n of the City returning the entire amount to the school districts. Mr. Ferguson was opposed to the $200,000 cap put on by the HRA. The School District staff is asking to get together with City staff to see if there is a way to accommodate the school district's interests on this issue. Ms. Schnabel asked what concerns the City Council had regarding this item. Councilmember Billings stated he was rather concerned when he saw this on the City Council agenda. One of the proposals that was before the legislature last session was that any new tax increment financing districts had to go to the counties and school districts. Now they can object, but their objections are not necessarily a veto. Some of the proposals floating around one year ago was that the county and school districts could essentially have veto power. So, he was a little concerned from a political standpoint that essentially they were taking the school districts money and using it for HRA purposes. Since the Council meeting on Monday night, and realizing that the increase in value on the properties has therefore also increased the referendum amount, his suggestion might be to come up with a formula rather than a dollar amount of $200,000 as recommended by the HRA. �` Although a lot of thought may have gone into the dollar amount, that dollar amount appears to be a little bit ; �� 80IIBING &_REDEVELOPMENT AIITHORITY MEETIN(�, JAN. 10. 1991 PAGE 14 � arbitrary. He stated Fridley is probably one of the only cities that is turning TIF monies back to the school districts. He stated it is important to be fair to the school districts so that, if in the future, the Legislature does come up with a program wherein the school districts and counties actually have veto power, the City and HRA have maintained a friendly relationship with the school districts. Ms. Schnabel stated she thought the HIZA was really fair when they voluntarily took the initial steps to turn back TIF monies to the school districts ahead of any other community. They certainly were not obligated to do it. But when the HRA saw how the turnback monies are dramatically increasing, and yet at the same time took another look at the Lake Pointe development and other projects, they were a little concerned and decided they maybe should not be too generous. Mr. Commers was the one who really brought these concerns to the HRA's attention. Ms. Schnabel asked the HRA members if they wished to reopen the discussion on the TIF turnback to the school districts. Mr. Meyer stated he did not think so. He stated the HRA discussed this at length at the last meeting. They had logical reasons for their decision, and they should leave it at that. Mr. Prairie agreed. Councilmember Billings stated maybe all that is necessary is for the City staff to meet with the school district staff. Ms. Schnabel stated the HRA did not think it was the type of situation where they needed to negotiate with the school district--the HRA is strictly looking at their budgets and what they are facing in the future. Ms. Schnabel stated it seems to be the consensus of the HRA members present that they are still comfortable with the $200,000 as recommended at the last meeting and do not see any reason to change it. Mr. Burns stated he believed that before the next meeting, the staff will have to meet internally and look at what the levy referendum was originally intended to ,^ bring in with what has actually gone into the tax increment return process. HOIISING & REDEVELOPMENT AIITHORITY MEETING. JAN. 10. 1991 PAGE 15 Mr. Prairie asked that the HRA be sent that information when staff has put it together. He stated it might also be helpful for the HRA members to see the figures from the first, second, and third years and the breakdown of what they were so the HRA can understand exactly what has happened. Mr. Burns stated he will get this information for the HRA. If they then feel they want to discuss this issue again, he can put it on the February agenda. Mr. Prairie asked that Mr. Commers be informed of what was discussed at this meeting. d. Housing Rehab and Housing Redevelopment Programs Mr. Burns stated he and Ms. Dacy have scheduled a number of ineetings with economic development people and city managers in other cities to take a look at how other cities are structuring their housing rehabilitation and housing redevelopment programs. Staff would like to put together an inventory of different strategies and different incentive programs that are being used in these two areas. They have meetings scheduled with Columbia Heights, Minneapolis, and Brooklyn Center. Mr. Burns stated the HRA members also were given a copy of a letter from Dave Newman with a copy of an article that deals with the project in the E1 Cerito, California. El Cerito has been involved in a housing redevelopment program that has used an equity participation process, so that is another technique the HRA might want to consider. e. Lake Pointe Mr. Burns stated he will be meeting on January 15 with Mike Scott and client who is interested in about 12 acres at the Lake Pointe site for a retail project. He stated he is trying to discourage this as he believed the HRA is more in favor of a project that is closer to the original plan for that site. f. Old Cub Food Site Mr. Burns stated Mr. Sid Inman, former Finance Director for the City, will be talking to City staff about a possible redevelopment project on the old Cub Food site. � � HOIIBING & REDEVELOPMBNT AIITHORITY MEETINGi JAN. 10. 1991 PA(3E 16 g. Fridley Plaza Office Building Mr. Burns stated City staff has been approached by Jerry Caputo, who has been asking the City to cut down the property taxes on the Fridley Plaza Office building. That raises the issue about whether or not the pledge of future taxes contained in development agreement passes onto successors and assigns. Mr. Casserly stated it is his opinion that if there has been an involuntary succession, it probably is not enforceable against the successor. Mr. Burns stated that staff really did not want to start disturbing development agreements and the taxes pledged in the development agreements; however, as property values decline, at some point in the future the HRA may need to face the policy issue of whether or not it is prudent for the HRA to reconsider the tax levels that are pledged in these agreements. ADJOURNMENT: Vice-Chairperson Schnabel declared the January 10, 1991, Housing n and Redevelopment Authority meeting adjourned at 10:55 p.m. Respectfully sub itted, , �, �'�-,G� yn Saba Recording Secretary � 8 I G N- IN B H E E T � � HOIIBING AND REDEVELOPMENT AIITHORITY MEETING, — Jan� l� 1991 Name Address/Business ���f� iA, PL�I�� �7�L�Z ���N �O' ( e�-�- � � �8 �� ( � r�c � �� � E �. �� � .� 5�4� �'� �o 3 0 , w� "�k �r��dl F-o� � �U�����,��5 ` 3 I ��lc►�s;� ���� � n