HRA 02/03/1994 - 6341HOUSING AND REDEVELOPMENT AUTHORITY
MEETING
THURSDAY, FEBRUARY 3,r 1994
7:30 P.M.
PUBLIC COPY
CITY OF FRIDLEY
A G E N D A
HOUSING & REDEVELOPMENT AUTHORITY MEETING
THURSDAY, FEBRUARY 3, 1994, 7:30 P.M.
Location: Council Chambers
Fridley Municipal Center
CALL TO ORDER
ROLL CALL
APPROVAL OF MINUTES: January 6, 1994
ACTION ITEMS:
AWARD BID FOR RICE PLAZA . . . . . . . . . . . .
. . . . 1.1 -1.5
CLAIMS AND EXPENSES . . . . . . . . . . . . . . .
. . . . 2.1 -2.4
INFORMATION ITEMS:
LAKE POINTE MARKETING UPDATE . . . . . . . . . .
. . . . 3.1
UPDATE ON MEETINGS WITH HOUSING DEVELOPERS . . .
. . . . 4.1 -4.7
POTENTIAL TIF REQUEST, SCOTT LUND. . . . . . . .
. . . . 5.1
STATUS OF DAIRY QUEEN ACQUISITION. . . . . . . . .
. . . 6.1 -6.5
UPDATE ON NORWOOD SQUARE . . . . . . . . . . . . .
. . . 7.1 -7.5
OTHER BUSINESS:
ADJOURNMENT
CITY OF FRIDLEY
HOUSING & REDEVELOPMENT AUTHORITY MEETING, JANUARY 6, 1994
CALL TO ORDER:
Vice - Chairperson Schnabel called the January 6, 1994, Housing &
Redevelopment Authority minutes to order at 7:30 p.m.
ROLL CALL:
Members Present: Virginia Schnabel, John Meyer, Jim McFarland
Members Absent: Larry Commers, Duane Prairie
Others Present: William Burns, Executive Director of HRA
Barbara Dacy, Community Development Director
Craig Ellestad, Accountant
APPROVAL OF DECEMBER 16, 1993. HOUSING & REDEVELOPMENT AUTHORITY
MINUTES•
MOTION by Mr. Meyer, seconded by Mr. McFarland, to approve the
December 16, 1993, Housing & Redevelopment Authority minutes as
written.
UPON A VOICE VOTE, ALL VOTING AYE, VICE- CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
1. CONSIDER AUTHORIZATION TO PUBLISH SPECIFICATIONS AND TARE BIDS
FOR DEMOLITION OF RICE PLAZA:
Ms. Dacy stated that the Engineering Department and she coordinated
and prepared the spec document, the notice to bidders, and two
publications to the Fridley Focus and Construction Bulletin. The
taking of bids will occur on Thursday, January 27, 1994. The HRA
will receive and award the bids and authorize demolition at its
February 3, 1994, meeting.
Ms. Dacy stated the contractor will be responsible for the
demolition and removal of the building, its contents, and the
foundation by March 15, 1994, and regrading and reseeding the site
by May 1, 1994. The City is also asking the contractor to remove
the concrete sidewalk in front of the building and the bituminous
pavement to the rear and west of the building. The pavement in
front of the building will remain to allow the drive - through
traffic for the Dairy Queen.
Mr. Meyer referred to A -2, Scope of Work, page 1, of the
Specifications, second sentence from the bottom, which states:
"Upon completion of the demolition work, the Contractor shall fill
the excavation and compact the fill." He would recommend that this
m a
HOUSING & REDEVELOPMENT AUTHORITY MEETING, JAN. 6, 1994 - PAGE 2
sentence be changed to: "Upon completion of the demolition work,
the Contractor shall fill the excavation with clean granular fill
and compact the fill."
Mr. Meyer stated that B -12, Failure to Complete the Work on Time,
page 7, shows a "Schedule of Deduction for Each Day of Overrun in
Contract Time ". He asked why the City is penalizing the
contractor for not finishing work by a certain time. The reason
for his question is that usually this is not done unless the City
can prove liquidated damages (a demonstrated loss to the City) .
If the City penalizes a contractor, then legally the City has to
indemnify an extra as a bonus or reward. These are things he has
been told by lawyers in his work as an engineer.
Ms. Dacy stated staff took the Engineering Department's typical
bid package and amended it for this particular project. However,
this is the HRA's project, and the HRA can amend B -12 if they wish
to do so.
Mr. Burns stated that the Council has been very adamant on
penalties and rewards in City contracts.
Mr. Meyer stated that when a contractor sees a schedule like this,
usually the contractor will add something onto the cost to protect
him /herself. So, it can artificially increase the cost of the bid.
There is no need for the City to have a schedule like this unless
there is a real need to do that. It is just not good business.
Mr. Meyer referred to C -14, Site Restoration, number 1, Topsoil
page 14, which stated: "When sodding or seeding is specified, the
contractor shall furnish the designated quantities of natural
soil." He stated that in another part of the specifications, it
says "fill material, grading, top soil, and seeding ", and it
implies that seeding is a part of the work. He believed they
should be very specific with where the seeding is required on the
site. Who is going to maintain the seeding? Does the HRA want
the contractor to water it for a period of time, or should the
City's Public Works Department maintain the seeding?
Ms. Dacy stated the contractor is only required to demolish the
building and seed the area. After demolition and seeding, the HRA
can have the Public Works Department water and maintain the site
or the HRA can contract out for the maintenance.
Ms. Dacy stated that regarding Mr. Meyer's comment about being
specific about the seeding, C -14, page 16 of the Contract, is
specific that "placement of topsoil, seed and mulch shall be
completed by May 1, 1994, and shall constitute the final completion
of the project." She believed C -14 is the typical language used
in all City specifications. The Contract on pages 16 -17 will be
the contract that the HRA will approve at the February meeting.
Mr. Meyer stated that if they want seeding to be done, they should
be specific that 'seeding shall be done' and be specific about the
ik
HOUSING & REDEVELOPMENT AUTHORITY MEETING, JAN. 6, 1994 - PAGE 3
area where the seeding should be. Then this should obviously be
carried through into the contract verbiage.
Ms. Dacy stated she will incorporate the change regarding the
seeding into the text so it is clear.
Mr. Meyer stated he would still like to see the penalty, section
B -12, taken out of the contract. Usually, in a contract, the owner
will ask the contractor to estimate how many days it will take to
complete the project. There doesn't seem to be any place for that
in the specifications.
Ms. Dacy stated the project is supposed to be completed by March
15, 1994. The City will issue the contractor a notice to proceed
within 10 days after the award of the bid.
Mr. McFarland stated the project is set up so that the HRA would
not pay the contractor until the work is completed. He believed
that would be enough of an incentive for the contractor to get the
project completed within a reasonable length of time.
MOTION by Mr. Meyer, seconded by Mr. McFarland, to approve the
Specifications for Demolition of Structure at Rice Plaza, 236
Mississippi Street N.E., with the change in wording to "clean
granular fill" in A -2, Scope of Work; the deletion of B -12, Failure
to Complete Work on Time; and a definition of the area to be
seeded.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
2. CONSIDER APPROVAL OF 1994 HRA BUDGET:
Ms. Dacy stated the HRA budget has been prepared in the same
booklet form, color coded, as last year. As last year, staff is
trying to separate the expense portion side into two funds, the
operating expenses and the housing expenses. The operating
expenses are proposed to decrease by 5 %, and the housing expenses
will approximately double because the HRA has not made any payments
for the rehab programs to date, nor have they have acquired any
scattered site properties. Staff took the 1993 allocation and
added the 1994 allocation, and that accounts for the increase in
the size of the housing budget.
Ms. Dacy stated that subsequent to the December 1993 HRA meeting,
staff did make one minor change in the housing budget. That was
to increase the advertising by about 100 %. Mr. Grant Fernelius,
Housing Coordinator, feels that the HRA should be more aggressive
in advertising the first -time homebuyer program and more aggressive
in advertising rehabilitation programs for the single family homes.
So, this will probably be the first year of advertising the
multiple family rehab programs. Staff would like to do a full page
ad on the first -time homebuyer program early this year.
A
HOUSING & REDEVELOPMENT AUTHORITY MEETING, JAN. 6, 1994 - PAGE 4
Mr. McFarland asked if the MHFA would split the advertising costs.
Ms. Dacy stated the MHFA will provide a basic brochure on the
program and will customize the brochure to accommodate the local
community. In terms of other advertising, MHFA runs its own
routine ad in local papers, and that is usually just a press
release.
Mr. McFarland asked if the banks would participate in the
advertising costs. He stated that if the banks are beneficiaries
of the loans, they may be willing to do that.
Ms. Dacy stated that is a good idea, and staff will ask the banks
if they would consider participating in the advertising costs.
Ms. Dacy stated that staff also prepared an overall view of the
revenues versus expenditures. Staff is trying to be as realistic
as possible in terms of the anticipated cash flow up to the year
2000. It is staff's consensus that it is not realistic to make
too many assumptions after the year 2000. The only negative
balance that occurs in terms of the annual balance is in 1995, in
large part because of the final payment of the Lake Pointe
temporary tax increment bond. Rick Pribyl, Finance Director, has
advised her that staff will probably come to the HRA to sell
another bond and /or roll -over that bond into another issue.
Ms. Dacy stated staff has not programmed the Suh acquisition into
the expenditures, but did include the possible acquisition of the
Gunderson property and Fridley Town Square assistance of $300,000.
Ms. Dacy stated the HRA 1994 budget is conservative, but it is
realistic. Staff recommends approval of the 1994 HRA budget.
MOTION by Mr. McFarland, seconded by Mr. Meyer, to approve the 1994
HRA budget as presented.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
3. APPROVE RESOLUTION NO. HRA 1 - 1994. RESOLUTION DESIGNATING
OFFICIAL DEPOSITORIES FOR THE FRIDLEY HOUSING AND
REDEVELOPMENT AUTHORITY:
MOTION by Mr. Meyer, seconded by Mr. McFarland, to approve
Resolution No. HRA 1 -1994, Resolution Designating Official
Depositories for the Fridley Housing and Redevelopment Authority.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
4. LAKE POINTE MAINTENANCE:
Ms. Dacy stated staff recommends that the HRA approve a motion to
authorize staff to prepare plans and specifications and take bids
r
HOUSING & REDEVELOPMENT AUTHORITY MEETING, JAN. 6, 1994 - PAGE 5
for the Lake Pointe maintenance project. This is an annual
project.
MOTION by Mr. McFarland, seconded by Mr. Meyer, to authorize staff
to prepare plans and specifications and take bids for the 1994 Lake
Pointe maintenance project.
UPON A VOICE VOTE, ALL VOTING AYE, VICE- CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
5. CLAIMS AND EXPENSES:
MOTION by Mr. Meyer, seconded by Mr. McFarland, to approve the
check register (checks 2482 -2497) as presented.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
6. RICE PLAZA UPDATE:
Ms. Dacy stated Hong Kong Kitchen closed on December 24, 1993.
Staff is wrapping up all the details with Jim Kordiak before
demolition.
7. LAKE POINTE MARKETING PROPOSALS:
Ms. Dacy stated the HRA had an informational memo dated January 6,
1994, on this item. She stated Merrill Busch, the consultant, has
prepared a tentative schedule for the marketing program.
Ms. Dacy stated Mr. Burns, Mayor Nee, Mr. Busch, and herself have
been looking at potential logos, sign styles, and brochure designs.
She showed the HRA members the various logos, sign styles, and
brochure designs.
Ms. Dacy stated that in terms of an identity or logo, the
consultant did a number of variations on the theme of Lake Pointe.
The consultant developed a number of different styles in terms of
lettering and how it would appear on the printed materials.
Mr. Meyer asked if they are overworking the use of the word
"corporate ", suggesting a use for the site that might be too
restrictive to other uses that might also be acceptable.
Ms. Dacy stated she thought a corporate use was always the HRA's
intent of the use for the site. Corporate could mean many things.
The word "corporate" seems to convey the campus image.
Ms. Schnabel stated she believed the HRA's original intent was to
have' this as a corporate site or office buildings where many
corporations would have their offices, yet they had also thought
of a bank and maybe a hotel.
HOUSING & REDEVELOPMENT AUTHORITY MEETING. JAN. 6. 1994 - PAGE 6
Mr. Meyer stated that if they dropped the word "corporate" and used
the words "office park ", that would include many different types
of businesses but with an office environment. He just doesn't want
them to imply that only one corporation takes the whole site.
Mr. Burns stated the marketing program is being aimed at Minnesota
corporations. That was the HRA's and City Council's direction to
staff as a result of the joint HRA /City Council work session on
January 9, 1993, and that has been the whole thrust with Mr. Busch.
Mr. Meyer stated that if the HRA and City Council had agreed on a
corporate headquarters in their earlier discussions, then this is
fine.
Mr. McFarland asked how the HRA will control the aesthetics on site
once the land is sold.
Ms. Dacy stated that question came up in interviews with the
brokers. She stated she believed the HRA should look at a specific
set of design criteria and architectural guidelines. What she is
hearing from the HRA is that they want this to be a high class,
visible project that is a showpiece for Fridley. They might want
to put these changes in the development contract or restrictive
covenants. That is part of the reason for setting the style in the
advertising to let people know that this is a high class site.
Mr. Meyer stated he believed the HRA had some pretty specific
design criteria in the agreements with the first developer. He
stated that as. this site is being marketed, there might be some
questions in terms of restrictive covenants, zoning, etc., and it
might be smart to have those answers already in hand.
Ms. Dacy stated that is a good idea.
The HRA members were in agreement with the logo and design work as
chosen by staff.
ADJOURNMENT:
MOTION by Mr. Meyer, seconded by Mr. McFarland, to adjourn the
meeting. Upon a voice vote, all voting aye, Vice - Chairperson
Schnabel declared the motion carried and the January 6, 1994,
Housing and Redevelopment Authority meeting adjourned at 8:40 p.m.
Respectfully sub itted,
f
Lyon Saba
Recording Secretary
ft Aw
I
1.1
Community Development Department
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: January 27, 1994
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Award Bid for Demolition of Rice Plaza
On Thursday, January 27, 1994, the HRA received 16 bids to demolish
the Rice Plaza Shopping Center. The lowest bid was Herbst & Sons,
Inc., at $22,000. The Engineering Department has prepared the
appropriate contract which was reviewed in the specification
booklet at the last HRA meeting. The Engineering Department has
worked with this contractor in the past and believes them to be a
reputable contractor. Demolition will begin within ten days of the
HRA's approval.
Recommendation
Staff recommends that the HRA award the bid for the Rice Plaza
demolition to Herbst & Sons, Inc., for $22,000 and authorize the
Chairperson and Executive Director to execute the attached
contracts.
BD:ls
M -94 -35
g �
1.2
BID FOR PROPOSALS
RICE PLAZA DEMOLITION, PROJECT NO. 261
THURSDAY, JANUARY 27, 1994, 11:00 A.M.
Herbst & Sons Inc 5% Old Republic $22,000.00
2299 County Road H
New Brighton MN 55112
Renollett Trucking Inc Cashier Check $22,062.00
2324 153rd Ln NW $1,103.10
Andover MN 55304
Kevitt Excavating Inc
5% United Fire &
$24,282.00
7324 33rd Ave No
Casualty
Minneapolis MN 55427
Veit & Company Inc
5% Amer.
$25,163.90
14000 Veit Place
Institute of Arch.
Rogers MN 55374 -9583
Doty & Sons
Cashier Check
$26,400.00
116 Logan Parkway
$1,320
Fridley MN 55432
Steiniger Construction
5% Amer.
$30,000.00
3070 South Lexington Ave
Institute of Arch.
Eagen MN 55121 .
Carl Bolander & Sons
5% CNA Ins.
$31,000.00
251 Starkey St
St Paul MN 55107
Belair Builders
5% Amwest
$31,175.00
2200 Old Hwy 8
Surety
New Brighton MN 55112
Alexander Company
5% Granite Rep
$31,555.55
179 Irving Ave No
Inc.
Minneapolis MN 55405
Wickenhauser Excavating
5% United Fire &
$32,950.00
350 Villa Drive
Casualty
Cologne MN 55322
Doboszenski & Sons Inc.
5% Fidelity &
$34,975.00
6450 Pioneer Trail
Guarantee
Loretto MN 55357
'
RICE PLAZA DEMOLITION, PROJECT NO. 261 1.3
PAGE 2
:..:::...:...::::::............................:...:.......................................................
...............: .......................
...............................
i.........................................
::::. ...................
...............................
R. J. Valek Const.
5% Granite Re,
$33,720.00
4464 W Arm Rd
Inc.
Spring Park MN
F M Frattalone Excay.
5% Fidelity &
$41,600.00
3066 Spruce St
Deposit
St Paul MN 55117
Thomas Contracting
5% Transam.
$43,720.00
Ginther Excavating
5% Amer. Ins. of
$63,900.00
1930 Oak St
Arch.
Hastings MN 55033
J & D -Enterprise
5% Frontier Ins.
$63,940.00
5197 Laraque Rd
Duluth MN 55803
Abatement Inc
No Bid
2116 Myrtle Ave
St Paul MN 55114-1827
Amt Construction Company
No Bid
P O Box 224
Hugo MN 55038
Bjorkman Excavating
No Bid
7990 1st St No
Lake Elmo MN 55042
Innovative Irrigation
No Bid
10006 University Ave NW
Coon Rapids MN 55433
Mavo Systems
No Bid
5230 Parell Ave NE
Rogers MN 55374
DEMOUTION PROJECT
RICE PLAZA 236-250 MISSISSIPPI ST NEI .4 q
CONTRACT
This Agreement made and entered into this 3rd day of February 1994, by and
between the Housing and Redevelopment Authority of the City of Fridley hereinafter referred
to as the CITY (Party of the First Part) and Herbst & Sons, Incorporated
hereinafter referred to as the CONTRACTOR (Party of the Second Part).
WITNESSETH:
That the CONTRACTOR, in consideration of the covenant and the agreement of the CITY
hereinafter set forth, and for the sum and price of $22.000.00 hereby agrees that,
WHEREAS, THE CITY has heretofore asked for proposals for the furnishing of materials, labor,
and the use of the CONTRACTOR's equipment and all else necessary for demolition and
disposal of the structure at 236 - 250 Mississippi Street N.E. and appurtenances thereto, as
shown on the drawing and as set forth in the specifications now on file with the City, and that,
WHEREAS, THE CONTRACTOR has submitted a Proposal in response thereto, which has been
accepted by the CITY, in which the CONTRACTOR agrees to and shall furnish all necessary
materials, labor, use of tools, equipment, and everything necessary to perform the work
designated and set forth in the Contract, including all CONTRACTOR's superintendence, and
to fumish everything necessary for the completion of the Project.
FURTHER: The CONTRACTOR shall commence work under this Contract within ten (10) days
after notification by the Engineer to commence work; and he shall complete all of the demolition
work and backfilling as set forth in the Proposal and in the Plans and Specifications on or before
March 15, 1994. Placement of topsoil, seed and mulch shall be completed by May 1, 1994 and
shall constitute final completion of this project.
FURTHER: He agrees, under penalty of a Corporate Surety Bond in a sum equal to 100% of
the full amount of the Bid, to complete the work under the contract in accordance with the
Contract Documents.
The Contract documents consist of the following component parts, all of which are as full a part
of this Contract as though therein stated verbatim, or if not attached, as if hereto attached:
The "Plan" and "Special Provisions."
2. The "Proposal," "Bid Schedule" and "Bond" of the Contractor.
3. This "Contract" between the City and the Contractor.
4. Any modifications or changes in the terms of the Contract or Bid or additions to or
deductions from the amount or character of the work which is to be performed or which
may be agreed to in writing by the Contractor and the City.
16
DEMOUTION PROJECT 1.J
RICE PLAZA 236 -250 MISSISSIPPI ST NE
The CONTRACTOR agrees to pay all persons furnishing labor and material in and about the
performance of the Contract; and the CONTRACTOR will, within ten (10) working days after the
acceptance of the CONTRACTOR's Bid, execute this Contract and furnish a bond to be
approved by the City in a sum equal to 100% of the full amount of the Bid. The CONTRACTOR
further agrees to take all precautions to protect the public against injury and to save the CITY
harmless from all damages and claims of the CONTRACTOR or the CONTRACTOR's Agents or
Employees while engaged in the performance of this Contract and will indemnify the CITY
against all claims, liens and claims for liens for labor performed or material furnished as
aforesaid and against all loss by reason of the failure of the CONTRACTOR in any respect to
fully perform all obligations of the Contract.
The CITY agrees to pay the CONTRACTOR for the performance of this Contract, and the
CONTRACTOR agrees to accept in full compensation thereof the prices set forth within the
attached Proposal.
The CONTRACTOR and the CITY agree that all of the terms of this Contract shall be binding
upon themselves, their heirs, administrators, executors, legal and personal representatives,
successors, and assigns.
IN WITNESS WHEREOF, the Parties hereto have set their hands and seals this 3rd day of
February , 1994.
WITNESS
WITNESS
PARTY OF THE FIRST PART
HOUSING & REDEVELOPMENT AUTHORITY
CITY OF FRIDLEY
by
WILLIAM W. BURNS
EXECUTIVE DIRECTOR HRA
LARRY COMMERS, CHAIRMAN HRA
PARTY OF THE SECOND PART
r
ONTRACTOR
i
by
7 WIT S NA ME (TITLE)
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2.2
TO: FRIDLEY H.R.A
FROM: CITY OF FRIDLEY
RE: BILLING FOR ADMINISTRATIVE AND OPERATING EXPENSES
JANUARY 1994
................... ...............................
.................... ...............................
................... ...............................
ADMINISTRATIVE BILLING:
ADMINISTRATIVE PERSONAL SERVICES
ADMINISTRATIVE OVERHEAD
TOTAL ADMINISTRATIVE BILLING:
OPERATING EXPENSES:
U.S. West — Telephone Service
TOTAL OPERATING EXPENSES:
TOTAL EXPENDITURES — JANUARY 1994
File: \123DATA \HRA \TJF\BILLING.wk1 Details
Account #'s for
HRA's Use
2.3
Account #'s for
City's Use
14,271.00 101 - 0000 - 341 -1200
275.00 101 -0000- 336 -3000
460-0000-430-4107 14, 546.00
262- 0000 - 430 -43312 13.68 236 -0000- 336 -3000
13.68
1
3.1
i
Community Development Department
HoUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: January 28, 1994
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Lake Pointe Marketing Update
Merrill Busch & Partners, Inc., is now preparing a draft of the
direct mail brochure, as well as designing two 50 square foot signs
for the property. Busch is also assisting me with the development
of a display booth at the 1994 Commercial Real Estate Exhibition
in downtown Minneapolis on April 15. If we receive a draft of the
direct mail brochure or the sign plans prior to Thursday's meeting,
we will review that with the HRA at the meeting. We will continue
to keep the HRA apprised of the progress on the marketing effort.
BD:ls
M -94 -39
a°
Community Development Department
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: January 28, 1994
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Meeting with Housing Developers
The Executive Director and I are in the process of scheduling
meetings with a variety of housing developers to determine if there
is any interest in.a housing development in the southwest quadrant
of University Avenue and Mississippi Street. We have met with Jim
Winkels from Bellaire Construction and George Sherman from Sherman
& Associates. We also tried to arrange a meeting with Lynn Carlson
Shell from Shelter Corporation; however, she did not want to meet
with us at this time (see attached correspondence). We are also
in the process of contacting Larry Laukka of Laukka Development to
determine his interest in the property (he developed a portion of
the Centennial Lakes development in Edina).
As we did with the Lake Pointe property, we are meeting with
professionals in the housing development industry to obtain a
preliminary evaluation of the strength and weaknesses of the south-
west quadrant as a housing site. We are also in the process of
developing an economic analysis of redevelopment alternatives on
the southwest quadrant including a housing development only option,
a mixed use option of housing and smaller service retail /office
uses, and a office development as was contemplated for Target
Stores, Inc., a few years ago.
BD:ls
M -94 -41
900 Second Avenue South
Shelter Corporation Suite 880 4,2
Minneapolis, MN 55402
(612) 341 -7800
Fax (612) 332 -8284
January 12, 1994
Barbara Dacey
City of Fridley
6431 University Ave NE
Fridley, M 55432
Dear Barb:
I apologize for the difficulty you have had in reaching me. You
are correct, I was to get back to you with a time that was
convenient for Shelter Corporation to meet with you. After much
consideration and discussion with my partner, we feel that Shelter
Corporation's credentials are much more valuable to the City if the
City were considering rental housing. In our earlier discussion it
was not yet clear which direction the City would take in their
redevelopment efforts. However, given other current priorities at
Shelter Corporation and the depth of the for sale experience the
other candidates possess, we feel we would not be able to
significantly contribute to the research the.City is now currently
doing.
Should the City consider rental housing as an option for the
redevelopment site, we would be happy to share our expertise in the
field with the city and review various options the City would have
to expand their stock of housing.
I sincerely appreciate the consideration the City has shown Shelter
Corporation and I hope that there will be an opportunity for us to
work within in the City of Fridley in the future.
Sincerely,
Lynn Carlson Schell
Vice President
LCS
4.3
'
SWrm.an Associates
March 1, 1993 -
Ms*. Barb Dacy
Convuunity. . Development l?irector
6431 University Avenue
Fridley, , MN 55432
' Doa:r Ms. uacy :. _
We Are writing. in regard to pur ' ph.one conversation on Friday,
February .26th.. As we "mentioned', -,Sherma.n Associates iS, a active
doveloper o£ quality multi£amil5r housing iri -the metropotHan market.-
We would be interested_ in, rema' Ing in contact with the City of Fridley
• An regard, to development 'opypgr. tunnies : Enclosed you ' will find a bri(f
_ surrunary, of Sherman Associates development activities ('!e =as�a don It
he- sitate to give U., a - -gall.
incerely,
SiaERMAN' ASSOCIATES
Geor e E. Sherman
61100suip.
,!rrrrr tlddrr;cs: /525 Stmili Aoiffth Crreer, Suil=•>;(rf APV .51 4,51
1'hcrir:
(612,1332-3000 1 aY (h 12? ?22-8119
.t 2
4.4
Sherman Associates
Company Resume
Sherman Associates specializes in the design, construction and financing
of quality housing opportunities in Minnesota, North and South Dakota
and Wisconsin. We have 1,350 housing units with tax credits including
Riverside Plaza, Castle Rowhouses, 3100 Clinton and Stradford Flats
Apartments. With over 14 years of development and construction
experience, we are able to offer a diverse range of services in the
single family, multi - family and commercial markets. They encompass:
* Development Services
* Financial Analysis /Feasibility
* Site Analysis
* Marketing Programs /Feasibility
* Architectural Design
* Design Build Services
* Construction
* Equity and Debt Funding
* Federal, State Housing Programs
* Property Management Services
PROJECTS 4.5
Riverside_ Plaza
* Total rehab of Minnesota's largest apartment complex
* 1,303 units totaling $30 million
Stradford Flats
* 82 Units - Efficiency & 1 Bedroom
* Downtown Location
* $1 Million Moderate Rehab
Highland Terrace
* 22 single family homes
* Built in cooperation with the Farview Neighborhood
Development Corporation
3100 Clinton
* 8 single family homes
* 12 rehab rental units
* Built in cooperation with the Central Neighborhood
Improvement Association
3100 4th Avenue
* Currently under construction
* 9 single family homes
* 10 rehab rental units
* Built in cooperation with the Central Neighborhood
Improvement Association
Castle Rowhouses
* Substantial rehabilitation of 11 unit rental property
* Building is on National Historic Register
Browns Meadow
* 148 unit apartment building located in
Coon Rapids, Minnesota
* $8 Million New Construction
a e.
Hawthorn _Crossings 4.6
* $2 Million - 70,000 sq . ft. retail shopping center
* Built in cooperation with Farview Neighborhood
Development Corporation
* Currently under construction on West Broadway Avenue
In Minneapolis
Kenwood Isles Condominiums
* 146 Unit Senior Condominium Hi -Rise
* Built on the old West High School site.
in Minneapolis
* New Construction - $14 Million
Kenwood Isles Townhomes
* Unique townhome development located in the lovely
Kenwood Neighborhood of Minneapolis
* Built in conjunction with Kenwood Isles Condominiums
* New Construction - $5.4 Million
Cooperative Houses
* Franklin Commons Cooperative
2109 Blaisdell Avenue, Minneapolis
* Lowry Hill East Cooperative
24th & Lyndale, Minneapolis
* Bell Building Cooperative
* Rehabbed old Bell Telephone Building into apartments
Parkway Terrgge
* Single family home development in
Maplewood, Minnesota
* 90 Single Family Homes Priced $100,000 to $200,000
* New Construction - $14 Million
* Boardwalk and Park Place Townhomes
* 63 For Sale Townhome Units
Minneapolis, Minnesota
* New Construction - $4.2 Million
REFERENCES
Mark Schletty
Farview Neighborhood Development Group
1025 West Broadway
Minneapolis, MN 55411
Tim Mungavan
Central Neighborhood Improvement Association
310 East 38th Street, Suite 228
Minneapolis, MN 55409
Jay Jensen
Minneapolis Community Development Agency
105 5th Avenue South, Suite 200
Minneapolis, MN 55401
Mary Tero
Minnesota Housing Finance Agency
400 Sibley Street, Suite 300
St. Paul, MN 55101
Jim Weichert
Deloitte & Touche
4300 Norwest Tower
Minneapolis, MN 55402
Jim R. Wenker
Norwest Investment Services, Inc.
1400 Norwest Center
Sixth and Marquette
Minneapolis, MN 55479 -0146
Angela Christy
Leonard, Street & Deinard
150 South Fifth Street, Suite #2300
Minneapolis, MN 55402
Dean Thomson
Fabyanske, Svoboda, Westra & Davis
1000 Minnesota Mutual Life Building
400 North Robert Street
St. Paul, MN 55101
Dan Nelson
Best and Flanigan
Suite 3500
IDS Center
Minneapolis, MN 55402
(612) 521 -3982
(612) 338 -6036
(612) 673 -5095
(612) 296 -8139
(612) 344 -0249
(612) 667 -3380
(612) 335 -1672
(612) 228 -0115
(612) 339 -7121
4.7
r �
5.1
Community Development Department
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: January 27, 1994
TO: William Burns, Executive Director
FROM: Barbara Dacy, Community Development Director
SUBJECT: Scott Lund Development Proposal
Scott Lund will be submitting a rezoning and plat application for
construction of a building on the property owned by Royal Electric
and a portion of Al Schrader's property. Lund intends to relocate
his business to this property.
The plat is necessary since a portion of Schrader's property will
be added to the rear of the Royal Electric property. The rezoning
request is to rezone the Schrader property from C -3 to M -1 to allow
for an industrial building nfor mobile home maintenance activities.
The Royal Electric property is already zoned M -1.
The property is in the Onan Tax Increment district. Lund may apply
for soil correction assistance. If the project meets our guide-
lines, assisting the project would enable the HRA to prove to the
County that activities are occurring in the district. After four
years, state law permits the County to suspend tax increment
payments to the HRA if no activity is occurring within the
district.
More details on the development will be provided at a future date.
M -94 -37
6.1
Community Development Department
u HOUSING AND R,EDEVELOPmENT AUTHORITY
City of Fridley
DATE: January 28, 1994
To: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Status of Dairy Queen Acquisition
Darrell Jensen has advised that the scheduling order previously
approved by the court to resolve the Fitch condemnation is to
expire. The scheduling order stipulated that discovery would be
completed by February 1, 1994, and that the time for the hearing
of this positive motion was to occur by March 1, 1994, and the
filing of a joint statement of the case was to be completed by
April 1, 1994.
Given that the development agreement for redevelopment of the
northeast quadrant has not been completed at this point, the matter
must either be postponed once again or that the appeal filed by
Fitch proceeds as originally filed. Jensen advised that the court
would probably be unwilling to provide both parties with another
extension; therefore, the HRA should be advised that the appeal
could be continued.
Fitch has not indicated to me whether or not he will continue the
appeal process. I do know that he is still negotiating the
acquisition of the former Amoco site at the northeast corner of
Osborne Road and University Avenue. Further, I have not received
final confirmation from Wagner or Walgreen's as to their decision
on the property. Consequently, Darrell Jensen has prepared the
attached Notice of Motion and Motion for Summary Judgment to be
heard by the Court on February 28, 1994. No action is needed on
this item by the HRA.
BD:ls
M -94 -42
ROBERT A. GUZY
BERNARD E. STEFFEN
RICHARD A. MERRILL
DARRELL A. JENSEN
JEFFREY S. JOHNSON
RUSSELL I-L CROWDER
JON P. ERICKSON
LAWRENCE R. JOHNSON
DAVID A. COSSI
THOMAS P.MALONE
MICHAEL E HURLEY
VIRGIL C. HERRICK
HERMAN L. TALLE
January 3, 1994
ST/ A - ' ' ' I N,
Barna, Guzy & Steffen, Ltd.,,
ATTORNEYS AT LAW
400 Northtown Financial Plaza
200 Coon Rapids Boulevard
Minneapolis, MN 55433
(612) 780 -8500 FAX (612) 780 -1777
Court Administrator
Anoka County Courthouse
325 East Main Street
Anoka, Minnesota 55303
RE: Fridley Housing and Redevelopment vs. Fitch
Court File No. C7 -91 -4439
Our File No. 42001 -002
Dear Sir /Madam:
6.2 PAMELA M. HARRIS
CHARLES M. SEYKORA
WILLIAM M. HANSEN
DANIEL D. GANTER, JR.
BEVERLY K. DODGE
GREGG V. HERRICK
JAMES D. HOEFT
JOAN M. QUADE
SCOTT M. LEPAK
STEVEN L. MACKEY
DAVID M. WEIGEL
ELIZABETH A. SCHADING
WILLIAM E HUEFNER
ROBERT C. HYNES
1935.1993
Enclosed for filing please find a Notice of Motion and Motion for
Summary Judgment. On April 30, .1993 we filed the Affidavits of
Virgil C. Herrick and Barbara Dacy and the Memorandum in Support of
Motion for Summary Judgment with the Court.
Yours truly,
B A,, UZZ & STEFFEN, LTD.
`. Jensen
DAJ:
En osures
cc: Barbara Dacy
An Equal Opportunity Employer
ROBERT A. GUZY
BEIWARD E. — WMFFEN
RICHARD A. MERRILL
DARRELL A. JENSEN
JEFFREY S. JOHNSON
RUSSELL H. CROWDER
JON P. ERICKSON
LAWRENCE R. JOHNSON
DAVID A. COSSI
THOMAS P. MALONE
MICHAEL F HURLEY
VIRGIL C. HERRICK
HERMAN L. TALLE
January 3, 1994
Barna, Guzy & Steffen, Ltd.
ATTORNEYS AT LAW
400 Northtown Financial Plaza
200 Coon Rapids Boulevard
Minneapolis, MN 55433
(612) 780 -8500 FAX (612) 780 -1777
Bradley J. Martinson
Petersen, Tews & Squires
4800 IDS Center
80 South Eighth Street
Minneapolis, Minnesota 55402 -2208
RE: Fridley Housing and Redevelopment vs. Fitch
Your File No. 3561 -02
Our File No. 42001 -002
Dear Mr. Martinson:
PAMELA M. HARRIS
6.3 CHARLES M. SEYKORA
ISTLLIAM M. HANSEN
DANIEL D. GANTER. IR.
BEVERLY K. DODGE
GREGG V. HERRICK
JAMES D. HOEFT
JOAN M. QUADE
SCOTT M. LEFAK
STEVEN L. MACKEY
DAVID M. WEIGEL
ELIZABETH A. SCHADING
\XTLLIAM F. HL'EFNER
ROBERT C. HYNES
1935 -1993
Enclosed and served upon you by United States Mail, please find the
Notice of Motion and Motion scheduled for February 28, 1994 at
10 :00 a.m. at the Anoka County Courthouse. On April 30, 1993 we
served you with our Memorandum in Support of Motion. for Summary
Judgment along with the Affidavits of Virgil Herrick and Barbara
Dacy which relate to this Motion.
Your5�-f4uly,
ensen
DAJ:tp
cc: Barbara Dacy
FFEN, LTD.
An Equal Opportunity Employer
STATE OF MINNESOTA
COUNTY OF ANOKA
The Housing and Redevelopment
Authority of the City of Fridley,
Minnesota, a public body
corporate and politic under the
laws of the State of Minnesota,
Petitioner,
VS.
Ernest L. Fitch, Muriel K. Fitch,
Donald A. Fitch, and Judith A.
Fitch,
Respondents.
6.4
CONDEMNATION
DISTRICT COURT
TENTH JUDICIAL DISTRICT
Court File No. C7 -91 -4439
NOTICE OF MOTION AND
MOTION FOR SUMMARY JUDGMENT
IN THE MATTER OF THE CONDEMNATION OF CERTAIN REAL ESTATE
IN THE COUNTY OF ANOKA, STATE OF MINNESOTA, FOR
REDEVELOPMENT PURPOSES
TO: Respondents above - named, and their. attorneys, Bradley J.
Martinson, Petersen, Tews & Squires, P.A. , 4800 IDS Center, 80
South Eighth Street, Minneapolis, Minnesota 55402 -2208:
PLEASE TAKE NOTICE, that the undersigned will bring a Motion
on for hearing before the Court in the Anoka County Courthouse, 325
East Main Street, City of Anoka, County of Anoka, State of
Minnesota, on the 28th day of February, 1994, at 10:00 a.m., or as
soon thereafter as counsel may be heard.
Petitioner respectfully moves the Court for an Order pursuant
to Rule 56 of the Minnesota Rules of Civil Procedure, for Summary
Judgment in favor of Petitioner. The affidavits, Memorandum, files
and records establish that there is no genuine issue as to any
material fact and that Petitioner is entitled to judgment in its
favor as a matter of law.
Dated: January 3, 1994
6.5
Respectfully Submitted,
BARNA.,,6UZY &i STEF .EEN,, LTD.
DOr Eel�.j'A. nsen #49980
Virgil I�, rrick #44489
Attorneys f Petitioner
400 North o n Financial Plaza
200 Coo pids Boulevard
Minnea is, MN 55433 -5894
(612) 80 -8500
r
7.1
Community Development Department
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: January 28, 1994
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Status on Norwood Square Project
Jim Casserly and Westminster, Inc., are continuing to work on the
development contract authorized by the HRA in November 1993. Since
the authorization, KARE TV, Channel 11, did a news segment about
one of Westminster's projects in St. Paul. Attached for the HRA's
information is Westminster's response to the KARE it TV's article,
a letter from Thomas Feeney from HUD, and a synopsis of what the
segment said by Jim Froehle, the City's Public Information
Specialist.
I contacted St. William's Church and gave them a copy of the
attached information. They have reviewed it and advised me that.
they are confident that Westminster will proceed with the Fridley
project as planned, and they have no plans to make any changes as
a result of the KARE 11 TV coverage.
I also spoke with Thomas Feeney from HUD. He assured me that
Westminster, Inc., is a reputable company, and the issues
concerning the project in St. Paul should not affect the Fridley
project. Feeney spoke highly of Doug Mayo from Westminster, Inc.
Mayo was not involved in the St. Paul project.
BD:ls
M -94 -40
7.2
F R I D L E Y M E M O R A N D U M
h
TO: WILLIAM W. BURNS, CITY MANAGER,,
I�
FROM: JAMES B. FROEHLE, PUBLIC INFORMATION SPECIALIST J'
DATE: DECEMBER 23, 1993
RE: ALLEGATIONS AGAINST WESTMINSTER
On the December 16th 10 o'clock KARE TV Channel 11 news I watched
an in depth news segment about a Westminster property. I believe
it was in St. Paul and had about 100 units.
Unfortunately I do not .recall all the details, but here is what
sticks in my mind.
Apparently this was a follow -up to a shorter segment done earlier
this summer. Since the code problems including rotting carpeting,
broken sliding doors, poor maintenance and other stuff mentioned in
the earlier report were not corrected Channel 11 investigated
further.
Charges by Channel 11
- Westminster is defrauding HUD
- Residents are being recertified and their Section 8 rent is
being increased. Some are being charged back rent. (It is
supposed to be illegal to charge back rent when recertifying.)
- Westminster is circulating petitions which will help evict
renters who are sending their rent to a trust so the code
problems will be corrected. State law states renters can
escrow rent to ensure that problems are fixed.
- Westminster was audited (or what ever the term is) by HUD a
year ago. Even though HUD only does this to 10% of its
properties they will conduct another soon because of KARE's
investigation.
- Westminster refused to comment on this segment, though they
did during the summer investigation.
If you have other questions or want me to get a video copy for $50,
let me know. They do not have transcripts available.
Westminster
Building Partnerships for a Caring Community
January 11, 1994
WESTMINSTER CORPORATION Memorandum
BOARD OF DIRECTORS
7.3
*Joseph Errigo, President
to:
Barbara Dacy
*Edward Driscoll, Chair
*Albert Colianni
fr:
Doug Mayo
*Anne Heegaard
*Josephine Reed Taylor
re:
Further inquiries regarding KARE 11's report
Patrick Conway
Diana Markfort
Thank you• for. sending me the memo from your public information
Mary Leintz
specialist. Ill respond to each of the points raised in his memo.
Frank Snowden
Jerry Madsen
1.
No. allegation of fraud-has been levelled against Westminster by
Rev. Kevin McDpnough --
HUD or by the small group of residents who have concerns about
Ellen Brown
*Executive Committee
Westminster Place Apartments.
William Cosgriff (of Counsel)
2.
Rent recertification are carried out in accordance with applicable
WESTMINSTER
Federal regulation. Three Westminster Place residents have
CORPOGRTION
registered concern with.HUD about their recertification: As a
result, HUD-plans to review the files ,of these -three 'residents this
Joseph Enrigo
month. We `do not anticipate any problems with -the, way
John Horner
recertification was handled for these residents.
Susan Sands
WESTMINSTER
None of the residents at Westminster Place are being charged "back
CORPORATION ICES
rent ". However, under particular circumstances HUD's regulations
may require a tenant's rent be adjusted back to the date of
Joseph Errigo
recertification.
Richard McCarthy
Barbara Kilbourne
3.
Petition have not been circulated by Westminster in an attempt to
evict any residents. The only petition at Westminster Place that
we're aware of are ones the Westminster Place Resident Association
has used to get resident support in an attempt to change the officers
of the resident association.
There are no code violation at Westminter Place. Because of the
normal aging of the buildings and the wear - and -tear of active
families, rehabilitation was needed. The rehabilitation, which is
over 50% complete, includes such things as new stoves and
refrigerators, carpeting and vinyl flooring, counter tops, replacement
siding, and landscaping.
328 West Kellogg Boulevard a St. Paul, Minnesota 55102 • (612) 291 -1750 • Fax (612) 291 -1003
AN EQUAL OPPORTUNITY /AFFIRMTIVE ACTION ORGANIZATION
7.4 '
4. Westminster is not being investigated by HUD as was suggested by the KARE 11
report. As mentioned before, HUD is reviewing the files of three residents this
5. In lieu of "on- camera" responses, Westminster provided thorough written
responses to KARE 11's questions. We believe this left less room for
misrepresentation of Westminster's position.
Please let me know if there are any additional questions we can answer for you.
FROM CDC - WESTMINSTER CORE
I I R
/`yaws
• �r 6
,
4i. 91V
DEC 1 71993
Joaaph Errigo
we,stminater Corporation
328 West Kellogg Boulevard
3t Paul MN 55102
Dear Mr. grrigo:
1.14.1.394 12.33 7.5 F. 2
U.& DoomtRImt et Hewing and Urban Davtopnant
MJnnerpolj$4L Paul ofte, Aggl m v
W 0*6w d ""% 8001
%QAMf"R6. mmts eta SWI -2165
subject: 492-44207
Wootminster place
St. Paul, Minnesota
This is to confirm our recent telephone conversation
about the so called "federal investigation" of Westminster
Corporation reported on a local talav1sion nawa program.
The u.9. bepartmeat of Housing and Urban Development is
not conducting a "federal inveatigatioa or probe" of the
management practiced of Westminster Corporation. Rather,
based upon three tenant Written complaints about the tenant
application and recertification process, we have scheduled a
Leasing and occupancy review at Westminster place in JAAvArg
1994. This review will cover.thd administration of the
subsidy program at the development.
very nine r 'yours,
ihou-aa T. L�ee�ney
Manager
I r
I
Community Development Department
HOUSING AND REDEVELOPMENT AUTHORITY
City of Fridley
DATE: January 28, 1994
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Establish Guidelines for Property Acquisition
under Scattered Site Acquisition Program
We have received the appraisal for 560 Hugo Street N.E. and plan
to review it at the HRA meeting on February 3, 1994. At the
meeting, we would like direction from the HRA on price parameters
and other conditions.
GF:ls
M -94 -43
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOV 18, 1993 - PAGE 3
techniques. These dollars kfrom the City are helping them to do
this and to achieve their m ssion in a proactive manner.
Ms. Keenan stated her reaso for coming was not only as a School
Board member, but also as a p rent, to say that there are thousands
of students who have benefit ed from this financial support. It
also gives the School Board t e ability to keep their programming
current and to be an innovati and creative school district. She
thanked the HRA for their tim .
Ms. Schnabel thanked Ms. Keer
stated their remarks were very
sorry that the other two HRA
these nice statements.
2.
CONTRACT, ECO FINISHING:
Ms. Dacy stated that at the Oct,
staff to prepare a development ca
to ECO Finishing to assist them
square foot plating facility at
and Industrial Boulevard. Staff
the resolution and authorize the c
to execute the development cont:
Victor Rosenblum is defined as
responsible for repayment of the
and Dr. Rens for coming. She
h appreciated, and she was very
Hers could not be here to hear
meeting, the HRA authorized
pct to provide a $125,000 loan
the construction of x 29,000
northwest corner of 51st Way
commends that-the HRA approve
:person and executive director
The HRA should note that
redeveloper so he alone is
MOTION.by Mr. McFarland, seconded by * Meyer, to adopt Resolution
No. HRA 10 -1993 "A Resolution Author zing Execution and Delivery
of a Contract for Private Redevelopme t By and Between the Housing
and Redevelopment Authority in and r the City of Fridley and
Victor Rosenblum ".
UPON A VOICE VOTE, ALL VOTING AYE, VICE- CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSL .
3. DISCUSS SCATTERED SITE ACOUISITION:
Mr. Fernelius stated that at the HRA's October meeting, staff
presented the recommendation to divide the pool of funds budgeted
for the scattered site acquisition program in half; 50% to be
allocated to properties for general acquisition activities, and
50% to be allocated for properties identified through the housing
rehab program. Those would be properties that were not feasible
to rehabilitate.
Mr. Fernelius stated staff identified several properties they
thought would be good candidates to acquire. The HRA members had
some questions about what to do with the properties once they are
acquired. Both properties (560 HugoStreet and 513 Fairmont) are
considered non - buildable sites, because they do not meet the
yt %
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOV. 18, 1993 - PAGE 4
minimum lot area requirements so it would be very difficult for
someone to purchase those properties and build on the lot without
a variance. Essentially, the HRA would be acquiring sites that
would be difficult to reuse, and there would be some costs involved
in holding on to those properties.
Mr. Fernelius stated staff would like the HRA to take another look
at the goals of the scattered site acquisition program. One
potential goal of the program is to acquire properties that are
buildable lots so there is the potential for some type of return
as far as land sale incomes. On the other hand, there is the
ability to acquire properties which' are definitely blighting
influences on the neighborhood and are difficult for the owners to
sell based on their current conditions.
Mr. Fernelius stated staff believes that for the dollars that are
allocated, the scattered site acquisition program would really be
serving the greatest public good by acquiring those sites. The
only other option would be to do nothing -and let the. problems
continue. By acquiring the sites, they are eliminating the
blighting influence. There is the possibility to divide the lots
and sell to the adjacent property owners. Staff continues to
believe that properties in the second category should be the
primary objective of the program; however, they wanted to get the
HRA's input and concurrence.
Ms. Dacy stated the HRA had a lot of questions at their October
meeting, and staff wanted to confirm whether or not the HRA
believed the goals of the program are to remove deteriorated homes
or if they would prefer to' acquire properties that may have
deteriorated homes but were also buildable lots.
Ms. Schnabel stated there seems to be a lot of variables in this
program. There might be a property with a house that can be
rehabilitated, and there might be a property with a house that
cannot be rehabilitated.
Ms. Schnabel stated that if the HRA buys an unbuildable site, they
also incur the cost of demolition. What happens if they go through
all those expenses and then find out that the neighbors on either
side of the property are not interested in purchasing half of the
property?
Mr. Fernelius stated staff wanted to identify the site first to
determine the HRA's interest; however, before they would actually
move forward to acquire a site, they would make sure that the
adjacent property owners were interested in purchasing half of the
property and had the ability to do so.
Mr. Burns stated there is an economic incentive for the adjacent
property owners to purchase the lot because it would make their
properties conforming and easier to sell.
y t, r
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOV. 18, 1993 - PAGE 5
Mr. Meyer stated that if they are trying to rid a neighborhood of
blighted housing, that should be the HRA's primary objective. He
believed they should not turn away from purchasing a property and
getting rid of a blighted property because of a few thousand
dollars up or down. It should not matter if no one purchases the
property, because they have then accomplished the major goal which
is getting rid of the blight. Getting rid of a dilapidated house
on a nonconforming lot should be a priority over getting rid of a
dilapidated house on a conforming lot. He believed they should
purchase the properties at 560 Hugo Street and 513 Fairmont Street
and demolish the houses regardless of whether or not they have
buyers on the adjacent lots.
Ms. Schnabel stated that if they purchase a property and the
neighbors are not willing to purchase half the property, who is
responsible for maintenance of the property and the taxes?
Mr. Burns stated the HRA would be responsible for maintenance
however, they could probably get the property tax exempt.
Mr. McFarland asked if there is a prohibition against transferring
nonconforming properties.
Ms. Dacy stated there. is no prohibition against transferring
nonconforming properties.
Mr. McFarland asked how the City has evaluated the properties.
Ms. Dacy stated they have been using the assessed value from the
Assessor's office. At the last meeting, the HRA asked staff to
check on the current mortgages recorded against the properties and
staff will do that. Staff's original concern was what type of
procedure the HRA wanted staff to take on these type of a programs.
Whether buildable or nonbuildable, the HRA will not be making
money. Staff wanted to hear the HRA's priorities and discuss the
consequences of what they would do with the properties until they
could potentially be split between the two adjacent property
owners. Another option would be to wait to purchase these
properties until they have solid buyers.
Mr. McFarland asked the approximate purchase price for a lot.
Ms. Dacy stated most of the lots range between $25,000 and $40,000,
based on estimated market value for tax purposes.
Mr. McFarland stated he did not want to see the HRA get bogged down
with the dollars. He believed they should be interested in making
the property conforming; and even if they had to split the property
and give it to the adjacent property owners, it would be better to
get the properties off their hands.
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOV. 18, 1993 - PAGE 6
Mr. McFarland asked if it would make sense to condemn some of these
properties first and then purchase them.
Mr. Burns stated the City Council's general direction to staff has
been to not condemn residential properties; however, the Council
might have a different attitude toward. condemnation of blighted
properties and there may be some benefit in discussing this with
the City Council.
Mr. Meyer stated he agreed with Mr. McFarland that if they purchase
a property and cannot sell it, it is better to give each adjacent
property owner half of the property than to hang onto it and have
to maintain it. He also cannot see allowing the value of the
property to become a deal breaker. If they really believe they
should spend public monies to get rid of blight, then they should
go ahead and acquire the properties and not worry about the cost
of a lot. They have to keep their eye on their goal, and that is
getting rid of blighted properties. -
Mr. Fernelius stated he believed staff is pretty clear on the
direction-the HRA would like to go. He believed the recommenda-
tions staff developed fall in line with the HRA's objectives.
Staff -will proceed to research the two properties in question, but
will not do anything before coming back to the HRA..
Ms. Schnabel asked if the HRA members wanted to pursue the -issue
of condemnation with the City Council at this time.
Mr. Meyer stated he believed the HRA should wait until they have
more information.
Ms. Schnabel stated that her concerns are two -fold:
1. How are the taxpayers going to view the use of public
monies to purchase blighted properties? Is the HRA going
to receive criticism for taking City funds to buy
blighted housing or substandard lots, and then turning
them over to adjacent property owners?
2. If people hear about the HRA doing this, will there be
a tendency by some property owners to not maintain their
property because they know the City is going to come in
and purchase it?
Mr. Burns stated there are limited funds, and they will have to go
at it very slowly. This gets back to the question: How much
leveraging does the HRA want staff to do? If the HRA wants staff
to leverage, then maybe they should acquire developable properties
and work on those first to build a fund.
Mr. Meyer stated that regarding Ms. Schnabel's concern about the
taxpayers, he agreed it is a risk. However, he. believed the HRA
A
I,, .. I•
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOV. 18, 1993 - PAGE 7
has made a strong point in trying to get rid of blighted properties
in the City, and they will have to explain it to the public.
Ms. Schnabel stated she agreed it is worth it to try it with these
two properties and see how the program works.
Mr. Burns stated he has not heard any public criticism of the
City's rehab programs. He is more afraid that if they do not keep
the momentum going and get things accomplished, the criticism will
be more in the direction of why isn't the City doing more?
4.
PROGRAM:
Mr. Fernelius stated that in t e
from the Minnesota Housing Fin Ai
called the "Community Rehabilit
million initiative by MHFA to he:
preservation and improvement
program, because it allows the
design its own programs, and
accomplish the objectives.
last month, staff received notice
ce Agency (MHFA) of a new program
tion Fund Program ". This is a $2
p cities with various neighborhood
tivities. It is a tremendous
ity to identify its own needs,
hen bring in the dollars to
Mr. Fernelius stated the funds ar issued from the state to the
cities in the form of a grant. The cities can, in turn, use those
dollars for such activities acquisition, demolition,
rehabilitation, permanent financing, gap financing, and a number
df different options. Cities would ssentially do that by either
making loans or grants in turn to ell ible mortgagors.
Mr. Fernelius stated the City has the pp
to $350,000 in funds. Staff is. request g
an application to submit to the state 'n
The idea staff would like to 'present 's
expand the City's existing rental reh b
Under the current MHFA regulations fo
program, only natural persons are allo
loans. Corporations, partnerships, a
eligible. Based on this requirement, the
who would not be able to apply. So, st
these dollars to make loans to those in di
terms and conditions used under the exist
Drtunity to apply for up
authorization to prepare
the amount of $350,000.
to use the dollars to
ilitation loan program.
the rental rehab loan
:d to apply and receive
d non - profits are not
e are owners in Fridley
Mals is proposing to use
V and use the same
program.
Mr. Fernelius stated the funds need to be targeted in specific
neighborhoods. At some future date, the Cou 'il will need to adopt
by resolution the actual neighborhoods that uld be targeted. The
Housing Committee has identified several nei borhoods in the City
that would ultimately benefit most by thes program funds. On
Monday, November 22, 1993, staff will`presen this program to the
Council and recommend that the Counc 1 identify these
neighborhoods.
HOUSING & REDEVELOPMENT AUTHORITY MTG., NOV 18, 1993 - PAGE 8
Mr. Fernelius stated staff r ommends that the HRA authorize staff
to prepare an application to MPFA in the amount of $350,000 for use
with the existing rental habilitation loan program. The
application is due on Decembe 6, 1993.
MOTION by Mr. McFarland, second d by Mr. Meyer, to authorize staff
to prepare an application for he MHFA Community Rehabilitation
Fund Program in the amount of $3 0,000.
UPON A VOICE VOTE, ALL VOTING \AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
5. CLAIMS AND EXPENSES:
MOTION by Mr. Meyer, seconded by Imo. McFarland, to approve the
check register, checks #2446- 2471.
UPON A VOICE VOTE, ALL VOTING AYEX VICE- CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUS .
6. RICE PLAZA UPDATE:
Ms. Dacy stated the remaining tenant, H ng Kong Kitchen, will be
moving to Holly Center in December. I January, staff will be
asking for authorization to receive demol tion bids. In February,
the HRA will receive and award the demolition bid to a contractor.
In the meantime, the Fire Department ha requested use of the
building for fire training exercises.
Ms. Dacy stated she has been working ith the Engineering
Department to prepare the specifications fo the bids. She has
also worked with the MPCA on requirements fo the disposal of any
hazardous materials.
Mr. Meyer asked if any direction will be gi n in the specifi-
cations for how the property is to be finished.
Ms. Dacy stated that because the demolition will probably be done
in February, the - contractor will fill the hole and regrade it.
She is then hoping to work with the Public Wor s Department to
spread seed on the property in the spring.
7. FRIDLEY TOWN SQUARE UPDATE:
Ms. Dacy stated she has not received any more in ormation from
Lowell Wagner. Apparently, Walgreen's is re co idering its
interest in the site. Although she has not seen a revised site
plan, a revised plan puts Walgreen's on the west side nd the Dairy
Queen on the east side. She also has not heard fro Don Fitch;
however, Mr. Fitch is pursuing acquisition of the Amo o property .
at the intersection of Osborne Road and University Avenu . At this
C