HRA 03/13/1997 - 6274HOUSING & REDEVELOPMENT AUTHORITY MEETING
THURSDAY, MARCH 13, 1997
. T111 -
PUBLIC COPY
(Please return to Community Development Dept.)
HOUSING & REDEVELOPMENT AUTHORITY MEETING
THURSDAY, MARCH 13, 1997 * * * 6:00 P.M. * * *
AGENDA
BUDGET WORKSHOP:
From 6:00 p.m. to 7:30 p.m.
LOCATION: Conference Room A (upper level); next to Council Chambers
REGULAR MEETING:
Beginning at 7:30 p.m.
LOCATION: Council Chambers (upper level), Fridley Municipal Center
CALL TO ORDER
ROLL CALL
APPROVAL OF MINUTES: February 13, 1997
CONSENT AGENDA:
Revenue and Expenses .................................... 1 -1C
ACTION ITEMS:
Consider Appointment for Remodeling Advisor .................. 2 - 2B
Consider Service Agreement with the City of Blaine .............. 3-31-1
EDA for Remodeling Advisor
Consider Resolution for Execution of Noah's Ark ................. 4 - 4J
Development Contract
Consider Contract for Preparation of Final Plans ................. 5-50
and Specifications for Lake Pointe Intersection
HRA Agenda
March 13, 1997
Page 2
INFORMATION ITEMS:
Update on TIF Request for Redevelopment on ................... 6 - 6L
57th Avenue, by Steve Linn
Potential Amendment to Redevelopment Project ................. 7 - 7J
Area
Fridley Executive Center Update ............................. 8
OTHER BUSINESS:
ADJOURNMENT
HRA RESOLUTION NO. 3 - 1997
RESOLUTION AUTHORIZING EXECUTION AND DELIVERY OF A
CONTRACT FOR PRIVATE REDEVELOPMENT BY AND BETWEEN THE
HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE
CITY OF FRIDLEY AND NOAH'S ARK OF MINNESOTA, INC.
BE IT RESOLVED by the Board of Commissioners (the "Commissioners ") of the
Housing and Redevelopment Authority in and for the City of Fridley, Minnesota
(the "Authority ") as follows:
Section 1. Recitals.
1.01. It has been proposed that the Authority enter into a Contract for
Private Redevelopment (the "Contract ") with Noah's Ark of Minnesota, Inc. (the
"Redeveloper ").
Section 2. Findings.
2.01. The Authority hereby finds that it has approved and adopted a
development program known as the Modified Redevelopment Plan for its
Redevelopment Project No. 1 (the "Redevelopment Program ") pursuant to
Minnesota Statutes, Section 469.001 et seg.
2.02. The Authority hereby finds that the Contract promotes the objectives as
outlined in its Redevelopment Program.
Section 3. Authorization for Execution and Deliver
3.01. The Chairman and the Executive Director of the Authority are hereby
authorized to execute and deliver the Contract if the following conditions are
met by July 1, 1997:
1. Substantial conformance of a Contract to the Contract presented to
the Authority as of this date; and
2. A final approval by the City of Fridley of a housing revenue bond to
finance the project described in the Contract.
PASSED AND ADOPTED BY THE HOUSING & REDEVELOPMENT AUTHORITY OF THE CITY OF
FRIDLEY THIS 13TH DAY OF MARCH, 1997.
LAWRENCE R. COMMERS - CHAIRMAN
ATTEST:
WILLIAM W. BURNS - EXECUTIVE DIRECTOR
CITY OF FRIDLEY
HOUSING & REDEVELOPMENT AUTHORITY MEETING
FEBRUARY 13, 1997
CALL TO ORDER:
Vice - Chairperson Schnabel called the February 13, 1997, Housing
and Redevelopment Authority meeting to order at 7:30 p.m.
ROLL CALL:
Members Present: Virginia Schnabel, Jim McFarland, John Meyer
Members Absent: Larry Commers, Duane Prairie
Others Present: Barbara Dacy, Community Development Director
Jim Casserly, Financial Consultant
Grant Fernelius, Housing Coordinator
Dave King, Center for Energy & Environment
Gretchen Hanson, Tamarisk Resources
Bruce Carlson, Northco
John Gohmann, Minnesota Commercial Railway
Company
APPROVAL OF JANUARY 9 1996 HOUSING AND REDEVELOPMENT AUTHORITY
MEETING:
MOTION by Mr. Meyer, seconded by Mr. McFarland, to approve the
January 9, 1997, Housing and Redevelopment Authority minutes as
written.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
CONSENT AGENDA:
1. CONSIDER APPLICATION TO MHFA FOR MINNESOTA CITIES
PARTICIPATION PROGRAM
2. CONSIDER EXTENSION TO ADMINISTRATIVE SERVICES AGREEMENT WITH
ACCAP
3. REVENUE AND EXPENSES
Ms. Dacy stated Mr. Pribyl had submitted additional expenses
needing approval as outlined in his memo dated February 13, 1997.
MOTION by Mr. McFarland, seconded by Mr. Meyer, to approve the
Consent Agenda and additional expenses for approval as outline in
Mr. Pribyl's memo dated February 13, 1997.
HOUSING & REDEVELOPMENT AUTHORITY MTG. , FEBRUARY 13 1997 PAGE 2
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
ACTION ITEMS:
4. CONSIDER LOAN ORIGINATION AGREEMENT WITH CEE FOR HOUSING
REHABILITATION PROGRAM
Mr. Fernelius stated this item is a loan origination agreement
with the Center for Energy and Environment (CEE). In March, 1996,
we entered into an agreement with CEE to administer the housing
rehab programs. CEE's responsibilities include answering general
questions about the programs, providing applications, having a
staff person available on Tuesday evenings at City hall to assist
people, in addition to processing the actual applications which is
an involved process. This includes verifying income, checking
credit history, verifying the proposed improvements as well as
checking on the title to make sure everything is correct. They
also do the loan closing itself which is preparing the documents,
setting a time for the borrower to come to execute those
documents, and record documents with the County to secure the
loan. They also forward the loan information to the servicer so
that the loan payments can then be processed. The last thing that
they do is to verify the improvements are completed. After the
work has been completed, the borrower contacts CEE who will have a
staff person go out to make sure the work is done properly.
Mr. Fernelius stated CEE did an analysis last year to evaluate
their staff and overhead costs and discovered that they were not
able to recoup all their costs. This year, they are requesting an
increase in the fee. One of the most important changes that will
be made this year to the contract is implementation of an escrow
procedure. We will place the loan funds in an escrow account.
Those funds will be held by CEE and will not be released until the
work is completed. This tightens up the program and reduces any
possible risk to the HRA. The second aspect of this contract is
the increase in fees from $225 to $350 to cover all the tasks
mentioned in addition to taking on the escrow account management.
The last change to the contract will be a modification to the
memo. The memo indicated we were proposing a one -year contract.
Staff is recommending a two -year agreement with CEE due to the
success of the program and also trying to lock in some of the fee
structures so we know what our obligations will be in the future.
The contract would run through February 28, 1999. Staff has
programmed these additional costs into the operating budget for
the housing program.
Mr. Fernelius stated staff's recommendation is to approve the loan
origination agreement with CEE.
HOUSING & REDEVELOPMENT AUTHORITY MTG., FEBRUARY 13, 1997 PAGE 3
Mr. McFarland asked if the fee was paid by us.
Mr. Fernelius stated yes. The fee is paid directly to CEE.
Ms. Schnabel asked if the increase had already been budgeted.
Mr. Fernelius stated yes.
Mr. Meyer stated it seems that CEE is doing a lot for the money.
He is pleased the higher fee would include managing the escrow
account. He thought this was a positive forward step.
Ms. Schnabel stated she thought this looked well thought out.
MOTION by Mr. McFarland, seconded by Mr. Meyer, to approve the
Loan Origination Agreement with the Center for Energy and
Environment.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
5. CONSIDER REQUEST FOR TAX INCREMENT FINANCING BY MINNESOTA
COMMERCIAL RAILWAY COMPANY
Ms. Dacy stated Commercial Transload of Minnesota (CTM) is a
subsidiary of Minnesota Commercial Railway Company. They are
requesting that the City establish an economic development tax
increment financing district and that the HRA approve tax
assistance in the amount of $250,000 or 10% of their costs. They
would like that assistance provided through a loan and a grant.
Ms. Dacy stated the proposal is for a 57,000 square foot building.
The proposed employment for the site was six employees. CTM
operates a delivery or transportation service for their clients.
Their specific clients are steel mills. They arrange to transport
rolled coils of steel on rail cars. They come to this facility
where they are transferred to trucks and the trucks deliver the
coils to a variety of steel processors in the area. It is a
warehouse use; however, it has a unique building design because
they need a very large crane inside the building to unload the
steel from the rail cars and then onto the trucks. The other
interesting issue was that the site technically was considered
railroad property. According to State law, that is valued
differently than a typical commercial /industrial building. The
valuation is completed by the State, not by the City Assessor.
The valuation formula includes some accounting of income.
Ms. Dacy stated these were issues when staff first met with Mr.
Gohmann. After staff pursued the analysis, there are observable
advantages for this particular use. There is no outdoor storage
HOUSING & REDEVELOPMENT AUTHORITY MTG., FEBRUARY 13 1997 PAGE 4
proposed. There is only one dock, a significantly reduced parking
lot space, and minimal obstruction on the site plan within the
power line easement.
Ms. Dacy stated the property is located in the northeast corner of
the frontage road to University and 71st and just south of Northco
Drive. They plan to extend the existing rail spur into the
building where all the transfers would occur. There is a small
parking area and lots of green space. Because of its clients for
steel, they provide a unique service for manufacturing companies
not only in Fridley but in the metro area. The rail
transportation will reduce truck traffic not only on Fridley
roadways but in the metro area.-,.-Mr. Gohmann states that
transporting the steel by rail can eliminate three or four trucks.
The other advantage is by creating a district there would be no
local government aid reduction to the City as a result of this
district. The petitioner is willing to pay the equivalent of
taxes at the typical valuation of approximately $1.60 /square foot
or $92,000 for the life of the district. Because one of our
issues was the unpredictability of the increment and the
valuation, we felt it would be better for the HRA to enter into an
agreement that would stipulate that the petitioner had to pay a
minimum amount of taxes and that it would be used as and taxed as
a warehouse.
Ms. Dacy stated in the memo staff has proposed a pay -as- you -go
approach because of the uncertainty of the increment. Because of
the petitioner's willingness to pay a minimum amount of taxes, it
is recommended that the HRA proceed with the creation of the
district and the development of a development contract by
providing assistance through a grant and through a loan process,
and also subject that the petitioner agrees to pay $92,000 in
taxes for the life of the district. A district such as this can
last up to 10 years. Staff's recommendation is different from
what was recommended in the packet, but staff feels that this is
an appropriate use. The City Council reviewed this informally and
did not identify any concerns. Staff recommends the grant and
loan approach as in previous proposals.
Mr. Meyer asked if a new district would include only this land.
Ms. Dacy stated yes. It would contain the four -acre site proposed
to be developed by the petitioner.
Ms. Schnabel stated the railroad cars will be going in and out of
the building. Is that going to create any back up of traffic in
terms of the trucks coming in? Is there a chance that the rail
cars would be across the roadway?
HOUSING & REDEVELOPMENT AUTHORITY MTG. , FEBRUARY 13, 1997 PAGE 5
Ms. Dacy stated she understands the answer to be no. The building
will hold six to seven rail cars and they intend to do their
transfer activity inside. The extension of the spur would be on
the north side of 71st Avenue. Most activity would be in the
middle of the day. Staff was very specific that they did not want
rail cars stacked along the spur and along the right -of -way.
There may be a block at the opening in the southeast corner of the
building. It appears that trucks would stack inside.
Mr. Gohmann stated this was correct. This is the very end of the
line. He provided brochures of their company. Truck traffic can
either come in on Northco Drive or on 71st. The train will be in
about 11:00 a.m. The most they can shuttle at the crossing is
seven cars at one time. The typical occupancy on the crossing
would be 30 to 60 seconds. They may bring in another set of cars
in the afternoon. The rail cars are operated at 5 miles /hour and
will not block any process.
Ms. Schnabel asked how long it took to unload one car.
Mr. Gohmann stated there will be a 25 -ton overhead electric crane
inside the building. It takes 20 to 60 minutes to unload one car.
They have an operation now in place in Roseville. It started with
no traffic at all. They developed the business and now work with
steel producers all around the country. They have an inventory
control system with customers so that a customer can order the
specific coil out of inventory to be shipped. They may have to
place a coil in a particular place in the building.
Ms. Schnabel stated, with seven cars, it is potentially seven
hours of work. She asked if trucks come in during that time and
be loaded directly from the rail car.
Mr. Gohmann stated most of the time the steel is stored.
Sometimes, if it is a rush, the steel may go directly on the
truck. The typical timing is to store for 15 to 30 days. The
building is climate controlled so that it is warm. Many of the
coils are not coated and can rust if out in the environment. They
supply a lot of structural steel for builders as well. This
month, they have had 21 cars of steel beams alone. The typical
workload for seven cars is six to eight hours. There are times
this is three to four hours.
MOTION by Mr. Meyer, seconded by Mr. McFarland, to authorize staff
to start the process to create a tax increment district and to
negotiate a development agreement.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
HOUSING & REDEVELOPMENT AUTHORITY MTG. , FEBRUARY 13 1997 PAGE 6
6. CONSIDER REQUEST FOR TIF ASSISTANCE FOR TAMARISK
Ms. Dacy stated the request from Tamarisk is to assist in the
purchase of the Holi Haus property near Sandy's Restaurant on
Mississippi Street. The site is about one -half acre in size and
the structure that exists was originally constructed in 1952. The
site is located in the redevelopment project area but it is not in
a TIF district per se. It is in the Moore Lake area. TIF funds
can be spent in a redevelopment project area. The HRA has been
doing this in the past through low interest loans. The loan
agreements have ranged between 5% to 10% of project costs. The
acquisition here is $120,000 plus $12,000 in rehab costs. To be
,_consistent with previous requests, staff recommends a $12,000 loan
with a 5% interest rate for a slightly longer term. Tamarisk is a
non - profit organization, and they are attempting to create this
site as a learning center and education facility for their clients
and families. They have enough funds for the down payment for the
property and she believed the letter received lists additional
sources of funds that they would seek. In addition to the longer
loan term, staff is also proposing that the payments on the loan
do not have to start for three years. Staff believes that it is
appropriate to provide a loan and recommends the HRA authorize
staff to prepare a loan agreement with the terms as outlined.
Ms. Schnabel stated that Tamarisk is a volunteer organization
which services terminally ill persons and their families. It is
all volunteers. It is a little different type of business than we
have normally serviced.
Ms. Hanson thanked the HRA for their consideration. She feels
Tamarisk is a gift to the community. They could not have done it
without CDBG funds and support from the community. They are
grateful for any consideration that the HRA could give them. She
really feels the advantage to acquiring this property is that it
is a home rather than an office space for what they are doing.
What they are doing is giving a valuable gift for people who they
are serving who are dealing with a terminal illness. No one
receives money for what they do. They do not charge. They are
catching the people that fall between the cracks. The resource
education center also helps them to help a larger population by
helping them before they need us. Hopefully, they will provide
skills and resources so they can help others also. They help
different portions of the community at this stage.
MOTION by Mr. Meyer, seconded by Mr. McFarland, to authorize staff
to prepare a loan agreement with Tamarisk for $12,000 at 5%
interest for a 13 -year term, with no principal and interest
payments required in the first three years.
HOUSING & REDEVELOPMENT AUTHORITY MTG. , FEBRUARY 13 1997 PAGE 7
UPON A VOICE VOTE, ALL VOTI2uG AYE, VICE- CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
7. CONSIDER SUPPLEMENTAL PAYMENTS AND CHANGE ORDER FOR 3RD
STREET /MISSISSIPPI STREET INTERSECTION PROJECT
Ms. Dacy stated Mr. Flora, Public Works Director, is asking the
HRA to take action to approve the supplemental payment request for
the reconfiguration of the 3rd Street /Mississippi intersection.
This was discussed at the last meeting. The good news is that
there has been no increased costs. Staff are also requesting that
the County evaluate providing additional funds of $10,575.73.
Staff does not have a response back from the County. To
summarize, the numbers are the same. The RAO construction issues
and the final design costs were anticipated. What was not
anticipated was the change order for additional binder and wear
course work. Therefore, we are asking the County to contribute to
defray those costs. At the last meeting, Mr. Meyer talked more
specifically about the role of the consultants. In the
attachments, there was a letter from the consultants which
identifies overruns as a result of missed items in addition to
savings that they provided. The Public Works Director is not
recommending taking action against the consultant. The balance
paid is within the particular line item that you had for the
project. Staff recommends that the HRA approve the supplemental
payments and change order #1 for the project. If the County does
agree to pay additional funds, those funds will be subtracted from
the contribution.
Ms. Schnabel stated staff's memo mentions on the second page that
Mr. Flora's memo does not address the RAO easement acquisition
costs or the final design costs.
Ms. Dacy stated the chart she provided is the total. Mr. Flora's
memo had a bottom line of $254,000 which did not include the
easement acquisition costs or the design costs.
Ms. Schnabel asked if those costs were included in the figure of
$294,947.23.
Ms. Dacy stated yes, they are included in the total. The
contributions are subtracted from that total.
MOTION by Mr. McFarland, seconded by Mr. Meyer, to recommend
approval of the supplemental payments and change order ##1 for the
improvements at 3rd Street and Mississippi Street.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED UNANIMOUSLY.
HOUSING & REDEVELOPMENT AUTHORITY MTG., FEBRUARY 13 1997 PAGE 8
INFORMATION ITEMS:
8. FRIDLEY EXECUTIVE CENTER UPDATE
Ms. Dacy presented a mock -up of the proposed brochure. The
brochure is a fold out brochure with a place in the center for
inserts. The next step is to finish the inserts. Merrill Busch
and Mr. Burns are going to be doing this soon.
Ms. Dacy stated Mr. Burns and she met with MEPC about two
potential office developments on the site. They are reviewing
scenarios with Mr. Casserly regarding those two proposals. Staff
would like to complete the brochure in the next two or three weeks
and be able to present that to the potential office users.
Ms. Dacy stated she has intersection plans for Highway 65 and I-
694. That improvement will be proceeding and going out for bid
this fall. Money is available through the State so they may be
able to get an early start. The ramps at University will be
looked at this spring and the intersection improvement will be let
for bid this fall and initial construction in the spring of 1998.
An information meeting will be held at the Planning Commission
meeting next week.
Ms. Dacy stated the HRA and City Council may have a joint meeting
regarding a variety of issues that are now going on. Staff have
not identified a date.
Ms. Schnabel asked if they were still planning to do a promotional
video tape.
Ms. Dacy stated a video tape is still in the works. This could be
in conjunction with a presentation to a company that would want to
locate corporate headquarters on the site. The video would be
short and list the economic advantages of locating a facility in
Fridley.
Mr. Meyer asked what the timing of the brochure was and how would
it be released.
Ms. Dacy stated they did not anticipate an event. They hope to
complete the brochure in the next two to three weeks and to
provide a number of copies to MEPC to use in their meetings. They
have not talked about a direct mailing.
Ms. Schnabel asked, when meeting with MEPC, do they have a feeling
for what is happening in terms of office space in the metro area
and the suburbs. Office space downtown is quite tight now and
there is a need for expansion. Do they talk about that in terms
of the suburban areas to?
HOUSING & REDEVELOPMENT AUTHORITY MTG. FEBRUARY 13 1997 PAGE 9
Ms. Dacy stated yes. At the request of Mr. Commers, she is trying
to compile some articles and statistics around vacancy rates. The
leases executed during the 1980's are now nearing their end, and
there seems to be a lot of interest on the part of a number of
companies to evaluate staying or moving. The southwest metro area
continues to grow. United Properties was successful in leasing
one of their properties in Edina. There is movement in the class
A office market. MEPC is optimistic that it will continue.
9. HYDE PARK NEIGHBORHOOD SURVEY
Mr. Fernelius stated, in December, staff sent out a survey to the
residents in the Hyde Park neighborhood seeking feedback on the
housing programs offered in that neighborhood since September,
1995. Staff wanted their feedback on whether or not those
programs had made a difference in improving the neighborhood.
Mr. Fernelius stated, out of the 180 surveys sent, they got about
40 back or about a 22% response rate. They had a good response
from homeowners. They did not get a good response from either
landlords or tenants. In terms of the survey itself, most
respondents had lived in Hyde Park more than five years. Most
want to remain in their homes. Less than 200 of the respondents
took advantage of the programs. The deferred financing seemed to
be the most attractive reason for people to apply for the
programs. There was some contradictory information. 50% of the
respondents said that the programs encouraged them to remain in
Hyde Park, but the other 50% either did not think the programs
were encouragement for remaining or they were uncertain. Almost
2/3 thought the programs had improved the neighborhood. It is
unclear what those results mean. What is clear is that the
majority of residents would like the HRA to maintain the programs
and continue to offer them, so there appears to be support for
what we are doing. He thought the conclusion is that they want to
increase the marketing efforts in Hyde Park and re- evaluate the
efforts at the end of the year.
Mr. Meyer asked if there was any things they could institute which
would make the loan program more appealing to the residents of
Hyde Park or provide more generous loan programs to raise the
participation.
Mr. Fernelius stated he thought they have a good program now.
They are providing a deferred loan with up to $4,000 per unit
which is interest free. He thought this was an attractive offer.
They thought about making changes to the program but that may be
premature. He thought they needed to redouble the marketing
efforts and keep people aware of the programs. He did not think
they needed to make any changes to the program at this point.
HOUSING & REDEVELOPMENT AUTHORITY MTG. , FEBRUARY 13 1997 PAGE 10
Ms. Schnabel asked if staff would want to go into the area and
identify specific properties that staff thought needed assistance.
Mr. Fernelius stated, last summer, they did canvas the area and
take an assessment of property conditions. Rather than focus on
specific properties, continue to offer the programs neighborhood -
wide. There was a lot of positive feedback as a result of the
barbecue. The residents, he thought, are aware of what they are
doing. They just need to continue.
Ms. Dacy stated, in response to question 46, 2/3 stated they were
not planning to make any improvements to their homes. It may not
be related to the program as much as it may be related to the
homeowner. They may not be interested. There may be an income
issue or some other issue.
Ms. Schnabel asked if staff was planning another remodeling fair.
Mr. Fernelius stated yes. The remodeling fair will be held
April 5 from 10 a.m. to 3 p.m. at the Fridley Senior High School.
Hopefully, it will be as successful as last year. Most of the
booths are reserved by contractors.
Ms. Schnabel thought that may generate more interest in the
programs.
10. NOAH'S ARK UPDATE
Mr. Casserly stated he has been working with Gary Bidney and a
group of accountants and analysts trying to determine the level of
assistance that is needed to help with the Noah's Ark project.
Earlier, a proposal was presented for an 108 -unit senior complex.
Because the redeveloper was completing another project and
starting construction on one in Spring Lake Park, this was put on
hold for a few months. In the meantime, they have had a chance to
review market studies, look at comparable rents, and review
performance. It is clear that without some level of assistance
from the HRA this project cannot be done. The difficult issue is
trying to figure out the level of assistance that is needed.
Mr. Casserly stated this particular project is in a tax increment
district which runs until 2008. The amount of assistance is
governed by that time period. In addition, the tax increment that
is generated from a project like this is somewhat less because the
use is eligible for lower class rates. We have estimated that the
amount of increment that would be available for assistance would
be $127,000 per year. We will be recommending that level of
assistance be provided for the duration of the tax increment
district which would be until 2008 so there would be approximately
9 years of increment available for the project.
HOUSING & REDEVELOPMENT AUTHORITY MTG. , FEBRUARY 13 1997 PAGE 11
Mr. Casserly stated, if the HRA does not provide increment, the
rents would have to be increased. We have calculated the increase
to be anywhere between 14% to 15% in order to support the debt
service for this project. They are estimating rents in 1999 upon
completion of the property. Rents would range from $640 for a one
bedroom, 740 square foot apartment up to a maximum of $1,185 for a
two bedroom, 1,300 square foot apartment. Without the tax
increment assistance, the rents for those same two units would
range from $725 to $1,345 respectively. This is a considerable
increase in those rents which puts the project out the market. We
are not aware of any projects in the surrounding area that have
been done with several levels of assistance including tax exempt
bonds, tax credits,sreduced class rates, tax increment financing,
and possibly some other grants.
Mr. Casserly stated next month they will be bringing back a
redevelopment contract which will have that level of assistance in
the contract and a separate report showing why we are recommending
that level of assistance. The contract will say they will get
this level of assistance as long as they have a certain number of
units eligible for people with moderate income. That is the same
requirement that is being used to get the tax exempt bonds. They
will be having the same requirements that they to meet for the
Federal level in order to secure the tax exempt financing. It is
a $9+ million project that should work.
Ms. Schnabel asked what the rents were in the Spring Lake Park
project.
Mr. Casserly stated he had the study for that project and is near
the study for this development. He will get those figures but
they will be estimates.
Ms. Schnabel stated, when they have multiple sources of funding,
it would be interesting to know how that lowers the rent depending
on the number of units.
Mr. Casserly stated they have to make assumptions. When they do
the pro formas, they are assuming a tax exempt rate on bonds.
They have already worked into their pro forma what the debt
service number would be. That debt service assumes that they can
sell tax exempt bonds. They also work into the pro forma and show
as a revenue stream the amount of tax increment assistance. They
do a thorough analysis which must be done in order to market the
bonds. What they have shown us so far seems to ring true.
Mr. Casserly stated the rents for the units in Spring Lake Park
are as follows:
HOUSING & REDEVELOPMENT AUTHORITY MTG., FEBRUARY 13 1997 PAGE 12
36
1
bedroom
700
square
feet
$640 /month
8
1
bedroom
750
square
feet
$685 /month
28
1
bedroom
900
square
feet
$720 /month
8
1
bedroom /den
825
square
feet
$750 /month
8
2
bedroom
940
square
feet
$855 /month
Most of the units are one bedroom or variations. Only four units
are at the top price.
Mr. Meyer asked what the rents are for Village Green. It seems
that these rents are rather high for a one bedroom at 700 square
feet. The quality of construction is not nearly the quality of
construction at Village Green. That is a_lot of money for people
who are in subsidized housing.
Ms. Schnabel stated is worries her that they are not addressing
the low to moderate income problems that seniors are facing. The
rents seem high.
Mr. Casserly stated this is a fairly cost effective way for the
HRA to assist a moderate income need. The investment the HRA is
being asked to make is a result of the tax increment which is a
limited number of years. They are assuming that the rents are
going to be increasing at about 3% per year, and that they will
then have the right kind of coverages they need as the tax
increment receipts drop off. They need to show in the pro forma
that, after they no longer are getting this assistance, they will
have adequate coverages otherwise they cannot sell the bonds. The
HRA is actually assisting with a minimum amount of revenue and in
a fairly painless way. This is really assisting over time.
Ms. Dacy stated it is a more moderate market at Norwood Square and
Village Green. The market study showed there is a strong demand
for moderate income units. They do have the one story townhome at
Christensen Crossing but not a lot of those. They are still
required to meet income requirements which are higher than at
Norwood Square. This is hitting a different income bracket.
Mr. Casserly stated, as a practical matter, oftentimes the senior
tenant is going to fit within that income limit. It is easier to
do these projects for senior housing.
11. LINDSTROM METRIC TIF REQUEST
Ms. Dacy stated Lindstrom Metric was proposing to buy a five -acre
site west of Main Street, just north of ANR Trucking. This
property is located within the same district Mr. Casserly alluded
to. They want to keep Lindstrom Metric in the community. As part
of their soil test, they found an extraordinary amount of peat on
the site, as much as 20 feet. They are getting large estimates
HOUSING & REDEVELOPMENT AUTHORITY MTG. , FEBRUARY 13 1997 PAGE 13
back for soil correction and foundation costs. Staff is still
working with the property owner. Mr. Lindstrom may decide to
evaluate other sites. We indicated to him that if he is to pursue
this site this may require up to the full amount of increment
available for this site for the life of the district. She did not
think the site would be developed without assistance. She was not
sure that Mr. Lindstrom wanted to pursue acquisition of the
property. Staff will keep the HRA informed.
12. PROPOSED STRATEGY TO OBTAIN LONG -TERM FUNDING FOR HOUSING
REHABILITATION PROGRAMS
Ms. Dacy stated the bottom line is that staff is trying to seek
funding from the State through the Minnesota Housing Finance
Agency (MHFA) in order to preserve the HRA funds for other
redevelopment priorities in the community. The City loan that was
accomplished last year was a good start to initiate a truly
revolving loan fund that becomes self - sustaining. However, the
HRA and the City cannot afford to expend $1.5 million per year for
the next 15 years. She thought the City had a good model that the
State can use for first ring suburbs. They really focus on areas
in St. Paul and Minneapolis and other areas that have an excessive
amount of blight. This may be a change for them. We are
proposing a program that is more preventive. She thought it would
save the taxpayers money in the long run. Unless directed
otherwise, she, Mr. Casserly and Mr. Fernelius will be working
with the City Council, the State legislature, and the MHFA to see
if they would be willing to lend funds to Fridley and other
communities. They are trying to find outside sources for funds.
Mr. Fernelius stated the MHFA does have a lot of programs. Some
have worked in our community but the bulk of the programs have not
met our needs. We have a good model which we think could be used
elsewhere. They may seek funding to make a good fit. Whether it
will work long term is unclear at this point. At least, they
should make the attempt to sit down and talk.
OTHER BUSINESS:
13. LETTER FROM INDEPENDENT SCHOOL DISTRICT #14
Ms. Schnabel stated the HRA had received a letter from Independent
School District #14 thanking them for the return of funds to the
school district.
14. HRA BUDGET
Ms. Schnabel stated other information items on questions raised
includes the HRA budget. The HRA will be receiving a copy of the
budget shortly. Will the HRA meet on March 13 at 6:00 p.m.?
HOUSING & REDEVELOPMENT AUTHORITY MTG., FEBRUARY 13 1997 PAGE 14
Ms. Dacy stated they are planning to meet at that time. She will
talk with Mr. Commers to verify the date and time.
Mr. McFarland stated he would not be present for that meeting.
15. REMODELLING COUNSELOR
Mr. Meyer stated he saw they were still looking for the Remodeling
Counselor position. He asked if staff had any additional
information.
Mr. Fernelius stated they had received over 30 applications. The
job closed on February 10. He will be reviewing those
applications. Hopefully, there will be candidates to interview.
If they are comfortable with someone, staff will then come back to
the HRA for authorization to hire.
Mr. Meyer asked how the process of combining with the City of
Blaine worked.
Mr. Fernelius stated this is going forward. They are still going
forward with the full -time position.
Ms. Dacy stated, per the HRA's advise during the last meeting,
staff will ask if the candidate is willing to work part -time if
Blaine does not complete their part of the program.
Mr. Meyer asked if they had received more applications this time.
Mr. Fernelius stated they do have more applications this time. He
thought there were some candidates who reapplied. He did not know
how many new applications were received. He thought the position
as full -time made it more attractive.
ADJOURNMENT:
MOTION by Mr. McFarland, seconded by Mr. Meyer, to adjourn the
meeting.
UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL
DECLARED THE MOTION CARRIED AND THE FEBRUARY 13, 1997, HOUSING AND
REDEVELOPMENT AUTHORITY MEETING ADJOURNED AT 8:48 P.M.
Respectfully submitted,
Lavonn Cooper
Recording Secretary
S I G N— I N S H E E T
HOUSING AND REDEVELOPMENT AUTHORITY MEETING, February 13, 19
Name
Address /Business
J
TO: FRIDLEY H.R.A
FROM: CITY OF FRIDLEY
RE: BILLING FOR ADMINISTRATIVE AND OPERATING EXPENSES
FEBRUARY 1997
Account #'s for
HRA's Use
ADMINISTRATIVE BILLING:
ADMINISTRATIVE PERSONAL SERVICES
ADMINISTRATIVE OVERHEAD
COMPUTER OVERHEAD
(For Micro & Mini computers)
TOTAL ADMINISTRATIVE BILLING: 460- 0000 - 430 -4107
OPERATING EXPENSES:
USPS - POSTAGE 262- 0000 - 430 -4332
USPS - POSTAGE 460- 0000 -430 -4332
US WEST - PHONE SERVICE 460- 0000 - 430 -4332
STAR TRIBUNE - WANT AD 460 - 0000 - 430 -4334
TOTAL OPERATING EXPENSES
BENEFITS EXPENSES:
Account #'s for CR
City's Use Code
20,394.75 101- 0000 - 341 -1200
284.13 101- 0000 - 336 -3000
206.26 101- 0000 - 336 -3000
20.885.14
37.28 236 -0000- 336 -3000
161.05 236 -0000- 336 -3000
24.61 236- 0000 - 336 -3000
897.00 236 -0000- 336 -3000
1,119.94
CITY OF FRIDLEY - HEALTH INS 262 -0000- 219 -1001 171.05 236 - 0000 - 219 -1001
CITY OF FRIDLEY - DENTAL INS 262 - 0000 - 219 -1100 21.56 236 - 0000 - 219 -1100
CITY OF FRIDLEY - LIFE INS 262 - 0000 - 219 -1200 3.50 236- 0000 - 219 -1200
TOTAL BENEFITS EXPENSES: 196.11
TOTAL EXPENDITURES - FEBRUARY 1997 $22,201.19
File: \EXDATA \HRA \TIF\97BILL.xls Details
t
H1
HA
HA
HA
HA
HA
HA
11
12
13
.-- N
W ck'
t7 W
am
of
z
C
0
a
w
m
ZE
1
1-
w
d
0
J F
W N
LU
W J •-j
W W
w H
Q
0 0
Q �
C7 �-
z a
N W
W
2 w
Y S
W N
J Q
� U
� atL
•U
w
K
L
N
W
U
n
P
w
LL o in 0
f�¢QQ r
1H 1- r
N (nN N r
W W W
O O\ J J J r
O N J J J r
O O W W W r
LIJ
M
pp �
P d
C7 N Y r
\ Z m m r
J M
O ;- W 1- 0 0 C3 r
\ M 111 Z .--• LLl LLl r
O (.7 f 3 Ce Q Q
D U W W ea
n Z U N K Q-
W f ¢ � U D
w ¢ CL
Q K 0- 0- Q- r
W O Or O r
d' m C7 cc CY CL' r
a a C) cl) CD r
Z
f
Q
a
U
LLI
Of
U
0
O
a
CL
er
W
M
.x
W
E
M
1--
Z
U
U
Q
Y
z
¢w
m d
Y
[i ~
W
U
W
CY
Lu
[] N r
!A Z r
Z O r
¢
CY h- r
CL' r
O U r
2 (n r
W r
N O
¢
H r
O O
O
O
O
O
O
O
P
N
O
O
O
O
O
ti o
O O
O
O
O
O
O
O
(el
O
Vl
O
O
O
O
t!l O
O M
ti
O
f--
fl-
O
ti
O
N
10
O
S
CO
O
O O
O
O
O
.O
M
O
O
N
M
O
O
O
�O
O
N
w
P
J
O
(n
CO
(
r
Ln
to
N
O
P
O
S
Y
C
P
M
lr
C
C
(n
f`
E
7
N
u
1
L
J
O
•-
Y
J
r
Y
Vi
d
Ll
r
Vf
..-•
t/f
L
0
'O O
L O
>
Y
O
U
O
U
m
-0
.0
E
E
4)
n
N
U
(rl
U
�
co
•L
Y
Y
.O
M m
r
U
L
r-
w
C
w
II
w
41
C
(0
O
i
o
S t
C
In
w
a
f` C
ti
ti
In tel
Vl
C
Vl
lel
In
(fl
(n Vl
to
Vl Y
1n
In
(n •�
to Y
(n
Y
.L
Y
C
w
.L
C
d
c
..-•
r
1a..
C
fp`.
h
�
fp`.
r
r
L
(
r
C
O
U
N
C
C
c
Y
f0
F-
•L
Y
C
Y
(A
Y
N L
P
C
C
C
C
Y
O
O
E
7
E
7
7
u
1
L
O
41
Y
O
•-
Y
J
r
Y
Vi
d
Ll
r
Vf
..-•
t/f
L
0
'O O
L O
>
Y
O
U
O
U
m
-0
.0
E
E
4)
n
N
U
U
�
U
�
co
•L
Y
Y
M
M m
r
U
L
r-
w
C
w
II
w
41
C
(0
r
(n n
Q
Q
S
L
S
(0
O
W
11
N
e0
o
O
O
O
L
w
w
P
P (O
E
Y
Y
W
o
o
N N
J
U
U
U
w
-Ne
Y
(n
N w
O
L
w
f
w
01
tr
tr
Y
C
C
C
C
Y
C
(o
(o
O >
O
•F
O >
O >
C
L
L
N
(0
(o
(9
(0
W
¢
O
O C
N N
O
o
w
—
—
-
N
N L
N
N
•N
C
(0
w
w
w
w
N
7
Y
U
Y
U
3
L
u.
W
O
C
L
O
L
o
w
-�
J 7
O
L
L
O
O
O
O
eY
-w
I—x
(Y
•�
o
O
O
A O
J
N
N
S
7
>
Z
U
U
U
U
J
f
i
N
O =
O
O
O
O
O
O
O
O
O
O
O
O
o
O
O
O O
O
O
O
O
O
O
O
S
O
O
O
O
O
O
O
O O
O
O
to
O
O
1n
O
M
O
In
CO
O
O
to
1n N
O
O
.--
N
O
.--•
O
S
O
�-
O
O
S
ti
N
N
fl-
N
S
O
f-
N
N
O
f-
N
N
N N
O
N
.O
.O
N
'O
O
M
N
'U
•O
S
N
10
10 `D
M
M
M
*-t
M
M
N
M
M
M M
O
O
O
O
O
O
O
O
O
O
O
O
O
O
O
O O
O
O
o
O
O
O
O
O
O
O
O
O
O
O
O
O O
O
O
O
O
O
O
O
O
O
O
O
o
O
O
O
O O
O
O
O
O
O
O
O
O
O
O
O
O
O
O
O
O O
O
O
N
O
O
N
N
N
N
O
N
N N
O
.O
`O
•O
10
.O
O
10
lO
10
10
10
vl
(n
•o
lO
f-
S
S
N
S
S
ti
N
N
N
N
S
S
S
N
N N
O
N
S t
t
In
10
10
f` C
ti
ti
In tel
Vl
In
Vl
lel
In
(fl
(n Vl
to
Vl Y
1n
In
(n •�
to Y
(n
fp`.
h
fp`.
\
fppm..
1p`.
f`
Ol
G
P
of
U
P
Ol
U
P
P
P_
P
P
P_
U
U
P
P
P
P
[]
E
E
\ \
S In
(n n
S
S S
S
S •-•
(n
(el
N H
CO H
e0
O O
O
Cl
O
N
N N
N
N 1--
N
N
N
N
N
N N
N
N
N
N
N
N
N N
N
N w
N
N
N w
N w
N
O O
O
O
O
O
O
O
O O
Cl
O >
O
O
O >
O >
O
¢
N N
N
N
N
N
N
N
N
N L
N
N
N O
N O
N
O O
O
O
O
O
O
O
O
r Y
O ti
O
O
O O
O O
O
O O
O
O
O
O
O
O
O
O lfl
O
O
O 1-
O 1-
O
O O
O
O
O
O
O
O
O
O
O
O
O
O
O
cn 00
J e- 1O
O �
1- (n
a r`
O
(.� N
F- 1--
z z
U E
V7 �I;��
a O 0 n co Il-N �0 O O C VO�00 VU)NCO o c0 (D (J o[7V
'O N (M ^ O "O 7 p p N Lo m 7 "O:LO a)..N 7 in Q) (`7 N N Cl) O I M �:
> 11) d) to U) CO (D 7 to of 0 (D (h O (h V m a
m a V N N v � C(DD N N N N 7
C) 0 v.
E C
0 (II
C a
M CO I- Q II
_ U) 0
M 0 O/) L�770 OOCD to NC0m co (D f-m I- (D i 7 :0)..y.
0)- � N- (C O(D(V7 O(fl O NCDmCD00m mCOO m(D -00 (00 V) C a.
N O O O O O 7 0) a) U) - 7 CO (D r 00 00 O) -- (.
a N 'V a1 O tO7 I�f� N (h(D NnN ON(�. --In .-- [OO769('77 1 Lf) [0 C 69 '- � 69 t` 7 O 64 69 to N 69 69 Gq
_ N (`O (D .�- U-3 •- N EA EJ-T 64 69 69 cO s .. a
(s) Gq 119 69 69 69. V) (N U)... n_.
69 EA x:
69
O O O O o 0 0 o O O O 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 (N N
0 r- (D Cl)
O) N (h N O
N
69
�I O
to
. O)
O)
} °7
< O �
O
a
O
<
7
O
O a
C
U
O
U
C]I s N :�
W LO (o (n
LL O N U)
C U
O
c
E rn
< o ° r
o 0
N N O
� 11
t U)
O
_ Lt70 O)o U)OOtf) 00 O O OON('7000000000 0000 Ott) m co U
•t 6o O0) 7G) M� O (NDO II N� O A a
-60) .
(h 7� C6 N Q Z
E ; r N
a
� C �
a
CL
* N O
(3) 0) (N (0 (0000 II)OO O O O 'IT N00 - -O(N CD tt)1) CO to cc) (y) I-U)L�N CD N C
i 0� co O) COQ (��Nm CD (fl (D L- m 00 CO O NM(O0 o0 CC) NCO 0 0) O
O7( -O 0(070) r) r, 000 LI) N
F- O N 0 O N co o m o N .- (O N O) lf) .- OJ Ll) Lin
' � U
f\ O (7 X
U
n D
j tB N �� N O co O >
Q) (V a) N O) 'V_ r c
O (V OD 7 CO rn N N
69 C V)
F-
ui 000 CD _00 o 0LOO 00(D O o 000000000000 0000 00 t` U 0
O� E'00 C (0M� tNO (p p O 0000m000 0 0700 00 0) C N X
c cl f U)o0070 -0O)0 M000N ON Lo
p OOM QOO ti (D (MD (gyp aD tD (V MLI);ON �(DC U 7Nto U)'cY(D -ON U) E O m
m CO 6N9 N N 69 69� � 696964 �(R fA G4 Z;; (A 696969 E9 fR �N OND < N 0
(y
046,) fA 69 69 a 64 D
0 (�
} m
A a (7
i Z _ a
Z w C U SSn
w C 7
O .N w =- Z v N a�ni oC - IC L6 06 J Q N ¢
Q n O r n Z r n aci > p m (o o a m n o m n < a 7 2
ti F-4c Znc F-n c c c Oa w ?oo Q- <onvon°Qu)u)a m o F- m o
;F rn c^ o a < o a ro �° ~` a) a. a w < a U Q Q m m m 3 c Q a a ¢
a 7 a a V i S J �. U G; S o Ty v c> i_ n v m o -3 - c 0
s a Z= a O t m c m J_0 - 0 2 w 0 a o m ua N a m m a' � n � "} X
C7 Ci G G '-) 7 G O= '– w L— — Z U (N m (G o- G G> a L'.1
7 G 2 a 0 0 0 =3 :3 0 a -C-c G G G a «- -- O ` U
aU)< OUCl;�y �� <U� �(0< aF- C7 YQ (000(1)U) a- Q- <<Q�F -� 0
F-C L-0 LL
I IN
<1D z
>
z z z w 0
Ld -d 3 CP �j :3 W
W
u }§g?
z co = li 0
C �Z 1 W Z V
cr 3 0 j L, 0
Ull L L, L c
c-,
-L!2i
-
cr i LIU
;4
\\ \ \\\ \§ /}\\
N i I N,
z c
^/
{\
z LLI
i
01 co z c cr-, D
5 LLI L.
Er; c
-U Zf U
0 —
2 ~\<§
i
0 z i--
ui /\§
I
z m La (n V iz Zf -j C
Z LJ
\ ®/2 ®2/ ®« z Z
/j
LL, L)
rn
Li i
:2z 1
>
% \ \4 \3 \X4{«(\
.jj LLi
00
LD
C3
-C Li i
§ /z.
I IN
HOUSING
REDEVELOPMENT
AUTHORITY
DATE: March 7, 1997
TO: William Burns, Executive Director of HRA y0-
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Consider Appointment of Home Remodeling Advisor and
Approval of Employment Contract
A total of 37 applications were received for the Remodeling Advisor position. After evaluating
the applications, four candidates were selected for interviews which were held on March 6 th .
A finalist was selected for a second interview which will be held on March 10th. Both Fridley and
Blaine staff will be involved in the second interview and if successful we will check references
and make an offer of employment, subject to HRA approval.
As you are aware, this is full -time contract position. A sample employment contract is attached.
The Remodeling Advisor will work 24 hours per week in Fridley and 16 hours per week in
Blaine. Due to the additional costs and responsibilities of hiring a full -time employee, Blaine
has agreed to pay 45% of the costs, while the HRA will pay the remaining 55 %. A service
contract (described in a separate memo) will be executed with Blaine.
If approved, both the employment contract and Blaine service contract would last for one (1)
year. The HRA would have the ability to terminate the employment contract for any reason,
including performance issues or a reduction in workload (i.e. if Blaine no longer wants the
service). In the event of a serious problem, the HRA has the ability to terminate the advisor's
contract immediately, but would still be responsible for 30 days of compensation.
Additional information on the finalist and a specific recommendation will be made at the HRA
meeting.
G Fi
M -97 -119
HOUSING AND REDEVELOPMENT AUTHORITY
EMPLOYMENT CONTRACT
This contract is between the Housing and Redevelopment Authority in and for the City
of Fridley (EMPLOYER) and (EMPLOYEE).
EMPLOYER agrees to hire EMPLOYEE as
for the period beginning
EMPLOYEE agrees to perform the duties of
as indicated in the attached position description.
and ending
In return for EMPLOYEE'S services, EMPLOYER agrees to the following:
Payment of salary of
for the contract period to be paid bi- weekly.
2. Payment of EMPLOYER'S share of Social Security and Medicate (F.I.C.A.) and
contribution toward ICMA retirement account.
3. Payment of EMPLOYER'S share of premiums for life, dental, and health insurance
or alternative options under the Flexible Benefit Plan for Fridley Employees.
4. Provision of workers' compensation and unemployment compensation insurance.
5. Holidays with pay as established for non -union employees of the City of Fridley.
6. Accrual of annual leave at the rate of one and one -half (I Y2 ) days per month or
eighteen (18) days per year.
7. Eligibility of EMPLOYEE to participate in the Wellness Program for City Employees.
8. Reimbursement of EMPLOYEE at the rate of $0.31 per mile for the use of
EMPLOYEE'S automobile for purposes relating to City employment.
This agreement may be terminated upon mutual agreement or without cause upon
thirty (30) working days notice by either EMPLOYER or EMPLOYEE. The EMPLOYER
also reserves the right to terminate this agreement immediately and compensate
EMPLOYEE for 30 days worth of salary.
EMPLOYEE is subject to all other policies, practices, procedures, and laws not
specified in this agreement but applicable to employees of the City of Fridley. In case
of conflict, the terms of this agreement prevail.
This document is intended to memorialize the agreement between EMPLOYER and
EMPLOYEE fully and in all its particulars.
EMPLOYEE
(Signature)
Date
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR CITY OF FRIDLEY
William W. Burns, Executive Director
Date
MEMORANDUM
HOUSING
REDEVELOPMENT
AUTHORITY
DATE: March 7, 1997
Y
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Consider Approval of Service Contract with Blaine EDA
The Blaine EDA has expressed interest in contracting with the HRA to provide home
remodeling services. As mentioned in a previous memo, the advisor will be employed
on a full -time contract basis, but will split time between Fridley and Blaine.
A draft of the service contract is attached. The agreement stipulates that the HRA is
the employer and is responsible for all personnel decisions, including performance
evaluations and disciplinary action. Each community is responsible for providing work
direction to the employee during the scheduled days.
In addition, the contract specifies that the advisor will work a fixed schedule; Tuesday,
Thursday and Friday in Fridley and Monday and Wednesday in Blaine. We expect the
advisor to work in Fridley from noon to 8 p.m. on Tuesday and Thursdays and 8:00 a.m.
to 5:00 p.m. on Friday. Blaine is responsible for establishing times on Monday and
Wednesday. The contract does allow the parties to negotiate a different schedule
depending on workload.
The contract also specifies that Fridley will invoice Blaine once a month for 45% of the
employment costs. Each community is responsible for paying their own overhead
expenses such as supplies, office space, telephone, marketing, etc.
Finally, the agreement will coincide with the HRA's Remodeling Advisor employment
contract and will run for one (1) year. Either party may terminate the agreement by
providing 30 days written notice.
51
Blaine Service Contract
March 7, 1997
Page 2
Recommendation
Staff recommends that the HRA approve the attached Agreement for Home
Remodeling Services with the Blaine EDA.
G F/
M -97 -120
AGREEMENT FOR HOME REMODELING ADVISOR SERVICES
This AGREEMENT FOR HOME REMODELING ADVISOR SERVICES ( "Agreement') is
made as of the day of 1997, by and between the HOUSING AND
REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY, with its offices
at 6431 University Avenue NE, Fridley, Minnesota 55432 ( "Fridley HRA "), and the
ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF BLAINE, with
its offices at 9150 Central Avenue NE, Blaine, Minnesota 55434 ( "Blaine EDA ").
RECITALS
A. The Fridley HRA and Blaine EDA, through their respective governing
bodies, believe there is a need to coordinate an advisory service to
homeowners regarding home remodeling and related information.
B. The parties also believe there is a cost savings to share a full -time,
contract employee to provide said advice to homeowners in Fridley and
Blaine.
NOW, THEREFORE, in consideration of the foregoing and mutual promises contained
in this Agreement, the parties agree as follows:
1. Job Responsibilities
A job description for the Remodeling Advisor is attached as Exhibit A.
2. Employing Agency and Work Assignments
The Fridley HRA hereby agrees to be the employing agency. All personnel
decisions, including performance evaluations and disciplinary action, shall be
made by the Fridley HRA.
Each party to this Agreement shall be responsible for providing day -to -day work
direction to the Remodeling Advisor during the time allocation period as outlined
in Section 3.
3. Time Allocation
The Remodeling Advisor shall work 24 hours per week in Fridley and 16 hours in
Blaine. The Fridley HRA shall schedule work hours on Tuesday, Thursday and
Friday of each week. The Blaine EDA shall schedule work hours on Monday and
Wednesday of each week. The Fridley HRA and Blaine EDA, upon mutual
written consent may adjust this schedule depending upon the workload within
the respective communities. The Fridley HRA shall have priority in scheduling
work hours for the Remodeling Advisor.
Draft Copy
3/7/97
Page 2
4. Allocation of Costs
The Fridley HRA shall bill the Blaine EDA on a monthly basis for 45% of the
costs of the Remodeling Advisor position which shall include the following costs:
1) Salary
2) Employer's share of FICA.
3) Employer's share of Medicare contribution.
4) Health insurance premium.
5) Worker's compensation.
6) Unemployment compensation.
7) Employer's contribution toward retirement.
An annual budget for the position shall be prepared by the Fridley HRA at the
beginning of each calendar year for distribution to the Blaine EDA. Attached as
Exhibit B are the projected costs for the position under this Agreement.
5. Duration and Term
This agreement shall run for a term of twelve (12) months from the date of
execution or no later than March 31, 1998. Either party may terminate this
agreement by providing 30 days written notice. All costs of the position shall be
shared, according to conditions in Section 3 of this Agreement, up to the date of
termination.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first
written above.
HOUSING AND REDEVELOPMENT
AUTHORITY IN AND FOR THE
CITY OF FRIDLEY
By :_
Its:_
Date:
By :_
Its:_
Date:
Draft Copy
3/7/97 3
ECONOMIC DEVELOPMENT
AUTHORITY IN AND FOR THE
CITY OF BLAINE
By:_
Its:_
Date:
By:_
Its:
Date:
% { ^G?' xf
4
�UV��l7
IWNJ F-IMI'l
POSITION TITLE: HRA HOME REMODELING ADVISOR
REPORTS TO: HRA Housing Coordinator
POSITION OBJECTIVE: To assist residential property owners
with evaluating their home remodeling
and housing rehabilitation needs at the
City of Fridley and Blaine.
ESSENTIAL JOB FUNCTIONS:
i. Conduct inspection of residential properties at owner's
request.
a. Meet with property owner /s on site.
b. Conduct "whole house" building condition analysis.
2. ;valuate the physical condition_ of the property, including:
a. Energy efficiency
b. Structural, mechanical, electrical, and plumbing
deficiencies.
C. Interior space, function and floor plan issues.
d. Kitchen and bathroom upgrades_
Health and safety issues.
f. Exterior and cosmetic areas.
g_ Decks, walkways and drives.
Landscaping, grading and drainage.
3. 'provide owner with information on condition of the property.
:_. Provide owner with verbal feedback on potential issues
or cone= rns _
..rltt-en analysis I "epOi "t =0 O�,Jner, as neCeSSai V.
i>>
. ovide information and guidance to property owners on suc'�
topics as:
�• Options for improving property, including energy
savings, system upgrades, economic return of proposed
improvements.
b. Design issues and function of proposed improvements
c_ Potential building, plumbing, electrical and mechanical
code and other municipal requirements.
d. Evaluating, selecting and recommending materials and
products.
e. Evaluating "do- it- yourself" vs. Hiring a contractor.
f. Utilizing other professional resources, such as
architects, engineers, and legal professionals.
g- Referrals to City staff on planning, zoning, building
and financing resources.
5. Prepare brochures, project manuals, and other literature on
home improvement topics_
6. Prepare quarterly newsletter article on home remodeling
advisor services and cable television access program on home
remodeling topics.
�. Consult with Housing Coordinator, Building Official and
other City staff on pertinent issues related to the
counseling service.
a. Prepare customer service evaluation cards and distribute to
customers.
9. Participate in the annual HRA Remodeling Fair.
10. Prepare monthly reports on activity levels.
11. Advise HRA and staff on ways of improving service, as
necessarv.
12. Review with HRA Coordinator the status of all projects
regularly.
OTHER JOB FUNCTIONS:
tabl.l_S }7 and malilta lI On- C7o1I7
M
MINIMUM QUALI F ICATIONS :
1. A bachelor's degree or technical degree in housing,
residential design, architecture or closely related field.
2. Three years' experience in the residential remodeling
field.
3. Knowledge of local, state and federal building and housing
codes.
4. Knowledge of building materials, construction methods, and
components of residential structures.
5. A minimum of two years' experience in residential oroperrty
inspections.
6. Able to meet with property owners on evenings and week - ends
for appointments.
V. Valid driver's license.
8. Effective oral and written communication skills. ,
DESIRED QUALIFICATIONS:
1. Familiar with cost estimating and specification writing.
2. Able to work independently.
3. Previous work experience with an HRA or housing agency.
4. Structural design experience.
WORK ENVIRONMENT:
The attached work environment characteristics are representative of
those an employee encounters while performing the essential
functions of HRA Home Remodeling Advisor. Reasonable accommoda-
tions may be made to enable a person with disabilities to perform
the essential job functions.
WORK SCHEDULE:
As part of the normal work hour the schedule will include evening
and weekend hours. This is a contracted position that is subject
to renewal.
COMPENSATION AND BENEFITS:
'1'hi.s is a contracted, full -time position with the Fridley Housina
and Redevelopment Authority. Starting salary is
Per hour depending on qualifications. Benefits include insurance
(Life, health, workers' compensation, and unemployment
compensation) paid entirely or partially for the employee bhe
employer; eighteen (18) days of earned annual leave per yar
eleven (11) holidays per year; and employer's share of paym and
ents
to Social Security, Medicare and Public
Association. Employees Retirement
APPLICATION PROCEDURES:
Submit a letter of application (cover letter), a resume and a
City of Fridley application form
Position. to be considered for this
For to
materials contact the City of Fridley,
6431 University Avenue N.E., Fridley,
Applications must be received or Postmarked no later (612)
Monday,
February 10, 1997.
January 1997
Women and minorities are encouraged to apply
The Fridley Housing and Redevelopment authority and the City of
Fridley will not discriminate against or harass any employee -or
applicant for employment because of race, color, creed, religion,
national origin, sex, disability, age, marital status, sexual
orientation, or status with regard to public assistance.
Home Remodeling Advisor
1997 Cost Projections
Item
Amount
Salary
$ 31,200
Social security
$ 1,934
Medicare contribution
$ 452
Health Insurance
$ 2,304
Workers compensation
$ 370
Unemployment compensation
$ 310
ICMA retirement
$ 1,398
$ 37,968
1
Exhibit B
MEMORANDUM
HOUSING
AND
REDEVELOPMENT
AUTHORITY
DATE: March 7, 1997
TO: William W. Burns, Executive Director of the HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Consider Resolution Authorizing Execution of a Development
Contract with Noah's Ark of Minnesota, Inc.
BACKGROUND
On August 8, 1996, the HRA passed a motion authorizing staff to proceed with formal
negotiations with Ark Development to provide pay -as- you -go tax increment financing and
to prepare a development contract for HRA approval. Since last fall, the developer has
obtained the required land use approvals and has initiated the process to request a tax
exempt housing mortgage revenue bond issuance from the City. At the February 13,
1997 meeting, Mr. Casserly updated the HRA about the status of his review of the
development's pro forma and market feasibility study. The necessary approvals for the
bond issuance is likely to occur at one of the Council meetings in April
PROPOSAL
Noah's Ark of Minnesota Inc., a non profit housing group, is proposing to construct a 108
unit independent living apartment building at the site located just east of Springbrook
Apartments and just south of Wal -Mart Mart. 72 units are one bedroom units and 36 are
two bedroom units. The size of the units range from 750 square feet to 1,200 square
feet.
DEVELOPMENT CONTRACT
The site is located in Tax Increment District #3. As is typical with "pay as you go"
projects, the developer is required to complete the project and receive a Certificate of
Completion prior to receiving payments from the HRA. In return, the HRA agrees to issue
a "note" promising payment of tax increment (Schedule C of the development contract)
up to $683,156 beginning August 1, 1999 and terminating on August 1, 2007. This is the
entire amount of increment generated by the project until the end of the district on August
1, 2007.
2
Contract with Noah's Ark
March 7, 1997
Page 2
The contract defines "available tax increment" as increment which is generated by the
project site only, as if it were its own district. The note requires the HRA to pay the lessor
of the available tax increment or the scheduled payment amount identified in the note
($63,166). If the increment is not sufficient, the HRA is not obligated to pay the
outstanding amount unless increment becomes available. If there is any unpaid amount
at the point the district expires, the HRA is not obligated to pay the balance.
While insufficient increment is not anticipated (the project will generate approximately
$150,000 /year in taxes), this approach protects the HRA from using increment from the
remainder of the district.
Section 2.2 (j) also requires the developer to certify annually to the Authority that the
project is in compliance with the "exempt facility requirements" of the Internal Revenue
Code. In order to receive tax exempt financing, 40% of the units must be rented to
households at 60% of the area median income ($52,800).
The total project cost is $9,600,000. The contract, however, defines the cost of the
"minimum improvements" as $7,350,000 excluding financing costs, debt service reserve,
marketing, equipment, and working capital.
Mr. Cassedy's memo of March 6, 1997 documents his analysis of the market study and
pro forma. Without tax increment assistance, the rents would be 12 % to 14% higher, and
thus would not be affordable to Fridley seniors. The reduced interest rate on the bond
also helps to reduce the project cost and make the project attractive to the market in
which it is located.
The site contains a wetland and will require additional fill, wetland mitigation, and other
site improvements to create a buildable site. This proposal is really a true "housing"
project as opposed to the many redevelopment and economic development projects the
HRA has completed. The HRA's assistance is providing affordable senior housing as
opposed to creating jobs (Wallboard Inc.) or clearing the site for sale to a developer
(southwest quadrant).
ISSUES RAISED BY CHAIRPERSON COMMERS
In July, Chairperson Commers asked me to research previous Council discussion on
senior housing. Mr. Commers subsequently faxed a memo from 1989 from the City
Manager to the HRA (see attached). The Council developed this policy in response to
two concurrent senior development requests which were proposed at the time: John
Arkell's "Cottage" proposals, and Westminster's (now Common Bond) request for market
rate housing (Arkell withdrew his land use requests and the Westminster request did not
proceed because they needed about 25% assistance).
The proposed project by Noah's Ark meets the guidelines discussed in the 1989 memo.
The pay as you go approach preserve's the HRA's cash flow as opposed to a loan of up
F'; A
Contract with Noah's Ark
March 7, 1997
Page 3
to 15 %. The largest amount of assistance at $680,000 represents about 8% of the
project cost.
Noah's Ark is a non profit organization. The bond sale and the TIF must be in place for
the project to occur. The project meets the "but for' test.
Mr. Commers also asked that Todd Stutz be contacted to determine if the project would
affect the development of the senior townhomes. Stutz was contact in July and stated he
had no objections to the HRA assisting the project, and felt that both products would be
good for Fridley's senior market.
RECOMMENDATION
Staff recommends the HRA adopt the resolution authorizing execution of the
development contract. Section 3.01.(2) of the resolution. conditions execution of the
development contract on the approval of the housing bond by the City Council.
BD/
M -97 -118
HC
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE
CITY OF FRIDLEY
COUNTY OF ANOKA
STATE OF MINNESOTA
RESOLUTION NO.
A RESOLUTION AUTHORIZING EXECUTION AND DELIVERY OF A CONTRACT
FOR PRIVATE REDEVELOPMENT BY AND BETWEEN THE HOUSING AND
REDEVELOPMENT AUTHORITY IN AND FOR THE CITY FRIDLEY AND NOAH'S ARK
OF MINNESOTA, INC.
BE IT RESOLVED by the Board of Commissioners (the
"Commissioners ") of the Housing and Redevelopment Authority in and
for the City of Fridley, Minnesota (the "Authority ") as follows:
Section 1. Recitals.
1.01. It has been proposed that the Authority enter into a
Contract For Private Redevelopment (the "Contract ") with Noah's Ark
of Minnesota, Inc. (the "Redeveloper ") .
Section 2. Findings.
2.01. The Authority hereby finds that it has approved and
adopted a development program known as the Modified Redevelopment
Plan for its Redevelopment Project No. l (the "Redevelopment
Program ") pursuant to Minnesota Statutes, Section 469.001 et sea.
2.02. The Authority hereby finds that the Contract
promotes the objectives as outlined in its Redevelopment Program.
Section 3. Authorization for Execution and Delivery.
3.01. The Chairman and the Executive Director of the
Authority are hereby authorized to execute and deliver the Contract
if the following conditions are met by July 1, 1997:
1. Substantial conformance of a Contract to the Contract
presented to the Authority as of this date; and
2. A final approval by the City of Fridley of a housing
revenue bond to finance the project described in the Contract.
Adopted by the Board of Commissioners of the Authority this
day of , 199.
ATTEST:
Executive Director
Chairman
EN
KRASS
MONROE
K K N s s \1ovR wu. 1'._A.
■ James R. Casserly e'r'r () K N r; ) S ,% r 1. 1
Direct Dial. (612) 885 -1296
MEMORANDUM
TO: City of Fridley
Attn: Barbara Dacy, Community Development Director
William Burns, City Manager
FROM: James R. Casserly
RE: Tax Increment Assistance for the Noah's Ark Project
Our Project No. JRC 9571 -2
DATE: March 6, 1997
In reviewing the need for assistance of the 108 unit senior housing project to be constructed
by Noah's Ark of Minnesota, Inc., we have considered the following:
1. A Market Feasibility Study for Senior Housing in Spring Lake Park, Minnesota
prepared by the Maxfield Research Group, Inc. in December 1995.
2. The relevant pages which have been updated for the study described above.
The updated analysis was prepared in anticipation of the revenue bond issue for
the Spring Lake Park Senior Housing Project. The updated portion is attached.
I The current rent schedule for the Spring Lake Park Senior Housing Project
which is now called Oak Crest Apartment. The schedule attached is titled
"Oak Crest Apartment Unit Monthly Rental Rates ".
4. A pro forma titled "Fridley Housing Senior Housing Project" with the
description in the lower right corner "With TIF Proceeds ". This pro forma is
attached.
5. A pro forma for the Fridley Senior Housing Project with the notation, "No TIF
Proceeds" in the lower right -hand corner. This pro forma is attached.
>rrrr IE0u Su; i;ipu1Nr 011'X1: C1.vIi;e • 1650 \V'r:,r 1' 1 . Si.vu +,i\:u11\, N11\N, <11 554:3 1 1417
fi;i,ei nu, 1: 612 '883.15999
6. The assumptions and the cash flow and present value analysis. This analysis
shows the amount of tax increment generated based on the attached
assumptions. The assumptions and cash flow and present value analysis is also
attached.
Based on the studies and attachments, we have concluded that without tax increment
assistance rents would be 12 -14 percent greater than the projected 1998 lease rates. The
higher rents would deter the project being leased to acceptable occupancy levels, which, in
turn, would make unsalable the mortgage revenue bonds that are to be issued to finance the
project. In short, but for the Authority's assistance, this project would not proceed.
Below is a chart of the lease rates illustrating the necessity for tax increment:
LEASE RATES ($)
Approx Sq Ft 1996 1997 1998(w/ TI) 1998(No TI)
1 BR 750 645 665 685 775
2 BR 1200 1025 1065 1095 1240
A. The 1996 lease rates are from Table 18 of the Updated Market Feasibility
Analysis described in 2 above.
B. The 1997 lease rates are the actual lease rates for the Oak Crest Apartments as
described in Item 3 above. 25 of the units at Oak Crest Apartments have been
pre- leased for those rates. The project is due to open in the summer of 1997.
C. The 1998 lease rates with tax increment are found in the Fridley Senior
Housing Project pro formas, Page A -5 and Page B -5 (see Items 4 and 5 above).
D. The 1998 lease rate with no tax increment are arrived at by calculating the
value of the tax increment assistance and then subtracting that from the income
stream to arrive at the percentage increase needed in rents that would generate
the same revenues without the use of tax increment. Another way to consider
the impact is to use the projected tax increment revenue ($126,332) and divide
by the number of units (108) which is an annual subsidy per unit of $1,169.74,
which divided by 12 is a monthly subsidy of $97.48. In very general terms,
each unit would pay approximately $100 of additional rent per month without
the tax increment assistance (because the increases are based on a percentage,
the dollar amount of the increase is greater for the higher priced units).
MA
It should be noted that the tax increment assistance terminates in June of 2007. 13y that time
the project is projected to have adequate debt service coverage ratios without the need for
additional tax increment assistance (see the Fridley Senior Housing Project pro forma with
TIF proceeds, Page A -9, and the Fridley Senior Housing Project pro forma no TIF proceeds.
Page B -9. The debt service coverage ratios are significantly different with and without the
use of tax increment).
Our conclusion is that this project would not proceed without the assistance being provided
by the Authority. Even with the Authority's assistance, the Redeveloper needs to sell
mortgage revenue bonds at an interest rate that does not drive up the lease rates. The
construction costs must also approximate those costs shown on the pro formas on Pages A -2
and B -2. If we can provide any further assistance or any additional analysis, please give us
a call.
JRC /kh
Encl
- M,INN SO -i A
Y OF
02- 30 -24 -22 -0010
(Existing TIF #3)
3.400%
Original Market Value
5,754,079
44,262 / unit
4,603,263
Original Tax Capacity
126,129
60.000%
@
74,745
148,406
40.000%
@
Estimated Construction
Costs
104
units @
Estimated Market Value
80.000%
104
units @
Estimated Tax Capacity
60.000%
62
units @
40.000%
42
units @
Estimated Taxes
62
units @
42
units @
Pay 1996 Tax Rate
1.17662
Construction
100.000%
1997
Valuation
1998
Taxes Payable
1999
Administrative Fees
10.000%
Inflation
0.000%
Present Value Rate
06/01/97
8.000%
249,300
2.300%
6,831
3.400%
55,328 / unit
5,754,079
44,262 / unit
4,603,263
2.300% 63,525
126,129
3.400% 62,604
74,745
148,406
73,662
WAt_MART1 4G 17 -jun -5
* According to Anoka County's records, the TIF District terminates in June, 2007.
'ALMAR T 1 It a '7 -Jun-
Original
Estimated
Captured
Estimate d
Less:
Available
8.000%
P. V. RATE
Tax
Tax
Tax
Tax
Admin
Tax
Semi Annual
Cumulative
Date
Capacity
Capacity
Capacity
Increment
Fees
Increment
Balance
Balance
06/01/97
6,831
6,831
0
0
0
0
0
0
12/01/97
6,831
6,831
0
0
0
0
0
0
06/01/98
6,831
126,129
0
0
0
0
0
0
12/01/98
6,831
126,129
0
0
0
0
0
0
06/01/99
6,831
126,129
119,299
70,185
7,018
63,166
53,995
53,995
12/01/99
6,831
126,129
119,299
70,185
7,018
63,166
51,918
105,913
06/01/2000
6,831
126,129
119,299
70,185
7,018
63,166
49,921
155,834
12/01/2000
6,831
126,129
119,299
70,185
7,018
63,166
48,001
203,835
06/01/2001
6,831
126,129
119,299
70,185
7,018
63,166
46,155
249,990
12/01/2001
6,831
126,129
119,299
70,185
7,018
63,166
44,380
294,369
06/01/2002
6,831
126,129
119,299
70,185
7,018
63,166
42,673
337,042
12/01/2002
6,831
126,129
119,299
70,185
7,018
63,166
41,031
378,073
06/01/2003
6,831
126,129
119,299
70,185
7,018
63,166
39,453
417,527
12/01/2003
6,831
126,129
119,299
70,185
7,018
63,166
37,936
455,463
06/01/2004
6,831
126,129
119,299
70,185
7,018
63,166
36,477
491,940
12/01/2004
6,831
126,129
119,299
70,185
7,018
63,166
35,074
527,013
06/01/2005
6,831
126,129
119,299
70,185
7,018
63,166
33,725
560,738
12/01/2005
6,831
126,129
119,299
70,185
7,018
63,166
32,428
593,166
06/01/2006
6,831
126,129
119,299
70,185
7,018
63,166
31,181
624,347
12/01/2006
6,831
126,129
119,299
70,185
7,018
63,166
29,981
654,328
* 06/01/2007
6,831
126,129
119,299
70,185
7,018
63,166
28,828
683,156
1,193,137
119,314
1,073,824
683,156
683,156
* According to Anoka County's records, the TIF District terminates in June, 2007.
'ALMAR T 1 It a '7 -Jun-
E 0�A K D U V
City of frilief
44$1 UslreroitI A*ieeo a_ C.
r m Iri4tel.
046ee6e14 4640$
Jrk... (6131071 -0490
Chyka of th* City Manager
William YH_ Burn's
TO: Housing and Redevelo went Authority
FROX: William W. Burns ,j ��7
L 1;'
DATE: December 14, 1989
SUBJECT: TIF Guidelines for Senior Housing
council discussed the uses of TIF for senior housing projects at
a conference session on December 11, 1989. An informal consensus
reached at this meeting establishes the following guidelines:
1. TIF may be used to provide a loan of up to fifteen
percent (151) of the project cost for any purposes
allowed under State law. The loan is to be secured by
a second mortgage.
2. TIF may be used to provide a grant of up to five percent
(S$) of project cost. The grant is to be used for soil
correction or land assemblage.
3. TIF may be used to provide a combination grant and loan
that does not exceed the value of a fifteen percent (15$)
loan. The grant and loan components are to be used for
the purposes identified in Items 1 and 2.
4. In deciding whether to award a grant or loan, several
conditions should be observed:
a- There should be a demonstrated local market for the
project.
b. The loan or grant should be funded from the tax
increment generated by the project.
C. Generally speaking, preference should be given to
redevelopment projects over projects proposed for
vacant land.
OFF
idemorandum to F:RA
December 14, 1989
Page Two
Council also indicated a desire to reexamine the TIF standard for
senior housing at such. time as they consider comprehensive TIF
guidelines.
Finally, Council supports the use of housing revenue bonds as a
form of assistance for senior housing projects. They recognize
that this tool may be used by itself or in combination with tax
increment financing.
WWB:rsc
MEMORANDUM
HOUSING
AND
REDEVELOPMENT
AUTHORITY
DATE: March 7, 1997
TO: William W. Burns, Executive Director of the HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Approve Agreement for Final Design Engineering Services
with SEH
BACKGROUND
SEH has completed the preliminary design and engineering services authorized by the
HRA in November 1996. A successful neighborhood informational meeting was
conducted at the February 19, 1997 Planning Commission meeting (minutes enclosed in
packet). In order to accomplish a Spring 1998 construction start, the final plans and
specifications for the Lake Pointe intersection must be submitted to MnDOT on June 30,
1997.
The intersection design, as preliminarily approved by MnDOT, is nearly the same as was
contemplated in 1986, except for modifications to the 1 -694 ramps.
PROPOSED AGREEMENT
The attached agreement is for final design services to prepare the project for bidding this
fall. The agreement includes services for project management, base mapping, soils
investigation, final right of way determinations, final roadway design, final roadway
construction plans, and completing necessary permits including a DNR and Rice Creek
Watershed permit.
The total cost is $199,725. This amount has been included in the 1997 budget.
HRA COST
Because of the availability of Federal funds, the cost to the HRA for the intersection
improvement was reduced from $1,900,000 to $380,000 or 20% of the total. John Flora,
Public Works Director, advised me that this amount is for "construction dollars ". Design
preparation is typically in addition to the project cost. Flora is however requesting the
State to reimburse the City for the design costs, and keep the HRA contribution to
$380,000. It is staffs desire that HRA authorization of this agreement is in essence
Agreement with SEH
March 7, 1997
Page 2
$200,000 of the $380,000 share. It is expected that the State and County will be paying a
portion of these project costs as well.
RECOMMENDATION
Staff recommends the HRA approve agreement for final design services and workplan as
presented.
BD/
M -97 -117
W
AGREEMENT FOR ENGINEERING SERVICES BETWEEN
CITY OF FRIDLEY HRA, MINNESOTA
AND
SHORT ELLIOTT HENDRICKSON INC.
FOR TRUNK HIGHWAY 65 (CENTRAL AVENUE)
FROM
TRUNK HIGHWAY 694 TO LAKE POINTE DRIVE
IN ANOKA COUNTY, MINNESOTA
THIS AGREEMENT made as of the _ _ day of — in the year Nineteen
Hundred and Ninety -Six, by and between the CITY OF FRIDLEY HOUSING AND
REDEVELOPMENT AUTHORITY, MINNESOTA hereinafter called the HRA, and SHORT
ELLIOTT HENDRICKSON INC., 3535 Vadnais Center Drive, St. Paul, Minnesota, hereinafter
called SEH.
WITNESSETH, the HRA requires professional Final Design Services for the reconstruction of TH
65 (Central Avenue) from TH 694 to Lake Pointe Drive in Anoka County, Minnesota. The project
is more specifically described as removing the northwest and southeast loops to the TH I
interchange; realigning the northwest and southeast ramps to create intersections with TH 65; adding
auxiliary lanes on TH 65; intersection improvements at Lake Pointe Drive; access improvements
along County Road 35 and Hathaway Lane/Polk Street; and traffic signals. The project has been
approved for federal ISTEA funds and is a cooperative agreement effort between the HRA, County
and MnDOT.
NOW, THEREFORE, the HRA and SEH for the consideration hereinafter set forth agree as follows:
SECTION I - BASIC SERVICES OF SEH
A. GENERAL
1. SEH agrees to perform professional services in connection with the Project as
hereinafter stated.
SEI -I shall serve as the HRA'S professional representative for the final design of the
Project to which this Agreement applies, and shall give consultation and professional
advice to the HRA during the performance of their services.
M
I3. FINAL DESIGN SERVICES
Final Design Services will be performed in accordance with the scope of services identified
in the Work Plan included as Attachment A-
C. CONSTRUCTION SERVICES
Construction Services will be performed by Mn/DOT.
D. STANDARD OF CARE
The Standard of Care for all professional services performed or furnished by SEH under this
Agreement will be the care and skill ordinarily used by members of SEH'S profession
practicing under similar conditions at the same time and in the same locality. SEH
acknowledges and understands that the award of this Agreement to SEH is based in
substantial part on the skill and expertise of the individuals assigned to the project. Any
change to personnel assignments should be discussed with the HRA prior to its occurrence.
SECTION H - ADDITIONAL SERVICES OF SEH
A. GENERAL
SEH shall furnish additional services not included within the scope of the above work plan
if authorized in writing as an amendment to this Agreement by the HRA. The additional
services may include the following:
1. Photo imagery renderings to assist in public understanding of project.
2. Field stake proposed easements, right -of -way and construction limits.
3. Attendance at meetings in excess of the aggregate meetings identified in segment
work plans.
4. Making revisions in drawings, specifications or other documents when such revisions
are:
a. Inconsistent with approvals or instructions previously given by the HRA.
b. lZequired by the enactment or revisions of codes, laws or regulations
subsequent to the preparation of such documents.
Pagc o. 2
J..
Pw
C. Due to chml;es i- ecluired as a result of the I IRA'S failure to render decisions
in a timely manner.
d. Due to any other causes beyond SETTS control_
5. Additional services due to significant changes in the general scope of the project or
its design including but not limited to changes in size, complexity of character or
type of construction.
6. Serving as an expert witness for the HRA in any litigation or other proceedings
involved in the Project.
SECTION [I[ -THE HRA'S RESPONSIBILITY
A. THE HRA SHALL;
Provide full information as to its requirements for the Project.
?. Assist SEH by furnishing all available information pertinent to the Project.
3. Furnish copies of available aerial topographic maps and half section maps for the
area adjacent to the Project.
4. Furnish all existing right -of -way and property lines in the Project area.
5. Guarantee access to and make all provisions for SEH to enter upon public and private
lands as required for SEH to perform work under this Agreement.
6. Give prompt written notice to SEH whenever the HRA observes or otherwise
becomes aware of any defect in the Project.
7_ Bear all costs incidental to compliance with the requirements of this Section III.
SECTION IV - PERIOD OF SERVICES
A. 1=INAL DESIGN
The services called for in this Agreement shall be commenced within one \\;ee(: of approval
of this Agreement. The critical schedule dates are summarized below.
Page No.
M
B
A
i
C
• Anticipated Notice to Proceed 1997
• Preliminary Plan Submittal June 2, 1997
• Plan Submittal for Mn/DOT Revie", September. 1997
• Final Plan Submittal October, 1997
GENERAL
Unless sooner terminated as provided in Paragraph VI_D., this Agreement shall remain in
force for a period which may reasonably be required for completion of the Project, including
extra work and any required extension thereto.
SECTION V - PAYMENT TO SEH
PAYMENTS FOR THE BASIC SERVICES OF SEH UNDER SECTION L
1. Final Design
SEH shall be compensated for work as described in Section I.B. on the basis of the
properly allocable costs incurred on the Project, not to exceed $199,725. The costs
of performing the work on the Project shall include the direct labor costs incurred
relating to salaries of employees for time directly chargeable to the Project, plus a
1.69 multiplier for overhead costs times a 1.15 multiplier for profit. The cost of
reimbursable expenses as outlined in Section V.C., and the cost of equipment
utilization as outlined in Section V.D., shall also be included. SEH shall be
compensated monthly for this work based on costs incurred.
PAYMENTS FOR ADDITIONAL SERVICES OF SEH UNDER SECTION II AS
FOLLOWS:
1. The HRA shall pay SEH monthly for all other additional services authorized by HRA
and performed in accordance with Section II.A. Payments shall be based on the cost
of performing the work as defined in Section V.A.1.
REIMBURSABLE, EXPENSES
Transportation expense equal in amount to employee reimbursement.
2. Fees paid IOr, in the name of the HRA, for securin-1 approval of authorities havin�i
jurisdiction over the Project.
Pagc No_
Ga
KIJA
Layout and report reproduction expenses_
4. Other special travel and expenses connected therewith required in connection with
the Project and authorized by the HRA.
D. EQUIPMENT UTILIZATION
The utilization of specialized equipment (computers, electronic survey equipment and
automatic data plotting equipment) for data acquisition, detailed engineering computations
and plan preparation as well as for the development and preparation of easement descriptions
is recognized as benefitting the HRA through more efficient production of project documents
and minimization of costs involved with document modification when the Project scope or
other conditions change. The HRA, therefore, agrees to pay the reasonable cost for the use
of such specialized equipment on the Project. SEH invoices to the HRA will contain detailed
information regarding the use of specialized equipment on the Project and charges will be
based on the standard rates for the equipment published by SEH.
E. GENERAL
The payroll cost of salaries and wages as the basis for payment under Paragraph V.A.
and V.13. shat: n -.ean the cost of salaries and wages paid to principals and employees
engaged directly on the Project, including, but not limited to engineers, surveyors,
technicians, drafters, specification writers, estimators, stenographers and clerks, plus
cost of fringe benefits including, but not limited to, Social Security contributions,
unemployment, excise and payroll taxes, Worker's Compensation, Health and
Retirement Benefits, incentive compensation, sick leave, vacation and holiday pay
applicable thereto.
2. If this Agreement is terminated upon completion of any phase of SEH's services, the
monthly progress payments shall be made in accordance with Section V.A. through
V.D.. If SEH's services are terminated during the phase of the work, SEH shall be
paid for services performed during such phase. Payment during such phase shall be
based on an hourly rate as described in Section V.A. and V.B.
SECTION VI - GENERAL CONDITIONS
A. IZEUSE OF DOCUMENTS
All documents, including computer software. drawings, and specifications, prepared by SEII
pursuant to this Agreement are instruments of- service in respect to the Project. They are not
intended or represented to be suitable for reuse by the I IRA or others on extensions of the
['roieet or on anv other Projcct. Any reuse tiV*thout written verification or adaptation by SI I I
Pa3,;c No.
M
for the specific purpose intended will be at the HRA'S sole risk and %rithout liability or legal
exposure to SEII; and the I IRA shall indemnify and hold harmless SEH from all claims,
damages, losses and expenses including attorneys' fees arising out of or resultingr therefrom.
B. ELECTRONIC DRAWING FILES
The Electronic Files to be submitted by SEH to the HRA are submitted for an acceptance
period of 30 days. Any defects the HRA discovers during this period will be reported to
SEH and will be corrected as part of SEH'S scope of Basic Services. Corrections of defects
detected and reported after the acceptance period will be compensated for as Supplemental
Services.
The HRA acknowledges that the electronic files are constructed to meet the specific purpose
of the project identified herein. SEH offers no guarantees, warrantees, or representation as
to the accuracy, suitability or reliability of these electronic files for any, other purpose. Any
use or reuse of this information for other purposes is done at the sole risk of those performing
the use or reuse. Potential misinterpretations include but are not limited to positional
accuracy, topological (inplace or proposed) representation and programs used to derive
and/or interpret data (executables, criteria files, user commands, etc.).
C. ASSIGNMENT
SEH shall not, without the written consent of the HRA, assign any interest or obligation in
this Agreement.
D. BONDING, INDEMNITY AND INSURANCE
SEH does hereby agree that it will indemnify and hold harmless the HRA against any
and all liability, loss, damages, costs and expenses which the HRA may hereafter
sustain, incur, or be required to pay, but only by reason of and to the extent of any
negligent act or omission or intentional act of SEH, its agents, officers or employees
during the performance of this Agreement.
The HRA does hereby agree that it will indemnify and hold harmless SEH from any
and all claims, damages, losses and expenses including attorney's fees, arising out of
or resulting from the use of the design services provided by SEH under this
Agreement.
2. SEH does further agree that it will at all times during the terns of the Agreement have
and keep in force:
A single limit or combined limit or excess 11111br-clia L11�:ral liandil"
insurance policy of an amount ofnot less then X200.000 for Pr�_�;,rrty danrwe
Page No. 6
RIE
arising lrom one 0, currerpc, $60Q_,�00 t: >r total bodiiv or personal injuries or
death and /or damages arising from one occurrence. Such policy shall also
include contractual liability coverage naming the HRA, b }� its officers,
agents, and employees, as certificate holder, by specific endorsement or
certificate acknowledging the contract between SEH and the HRA.
b. A single limit or combined limit or excess umbrella automobile liability
insurance policy, if applicable, covering owned, non- owned, and hired
vehicles used regularly in the provision of services under this Agreement, in
an amount of not less than $200,000 per accident for property damage,
$600,000 for bodily injuries and/or damages to any one person, and $600,000
for total bodily injuries and/or damages arising forin any one accident_
c. A professional liability insurance policy covering personnel of SEH while
performing services under this Agreement, naming the HRA as certificate
holder in the following amounts:
$200,000 per claimant for personal injuries, bodily injuries, death, and/or
damages, and $600,000 for total bodily injuries, personal injuries, death
and/or damages arising from one occurrence.
d. Worker's Compensation Insurance.
3. Prior to the effective date of this Agreement, SEH will furnish the HRA with
certificates of insurance.
4. The HRA may withhold payment for failure of SEH to furnish certificates of
insurance as required above_
S. Any policy obtained and maintained under this clause shall provide that it shall not
be canceled, materially changed, or not renewed without thirty (30) days' prior notice
by the insured to the HRA.
E. AUDITS, REPORTS, RECORDS AND MONITORING PROCEDURES
SEH will maintain records which reflect all revenues, costs incurred and services
provided in the performance of the Agreement.
?. SEII will agree that the HRA, the State Auditor or legislative authority, or any of
their duly authorized representatives, at any time during normal business hours and
as often as they may deem reasonably necessary, shall have access to and the right
to examine, audit, excerpt, and transcribe any book, documents, papers, records, etc.,
and accounting procedures and practices of SEH which are rclev ant to the contract
PaL,e No. 7
1:' DATA PRIVACY
All data collected, created, received, maintained, or disseminated, or used for any purposes
in the course of the performance of this Agreement is governed by the Minnesota
Government Data Practices Act, Minnesota Statutes 1984, Section 1301 et seq., or any other
applicable state statutes and state rules adopted to implement the Act, as well as state statutes
and federal regulations on data privacy, SEH agrees to abide by these statutes, rules and
regulations and as they may be amended.
G. EQUAL EMPLOYMENT OPPORTUNITY - CIVIL RIGHTS
During the performance of this Agreement, SEH agrees to the following.
No person shall, on the around of race, color, religion, age, sex, disability. marital
status, public assistance status, criminal record, creed or national origin, be excluded
from full employment rights in, participation in, be denied the benefits of, or be
otherwise subjected to discrimination under any program, service, or activity under
the provisions of any and all applicable federal and state laws against discrimination
including the Civil Rights Act of 1964. SEH will furnish the HRA all reports
required by Executive Order No. 11246 and Revised Order No. 4, and by the rules
and regulations and orders of the Secretary of Labor, the Minnesota Department of
Human Services for purposes of investigation to ascertain compliance with such
rules, regulations and orders.
2. If during the term of this Agreement, it is discovered that SEH is not in compliance
with the applicable regulations as aforesaid, or if SEH engages in any discriminatory
practices, then the HRA may cancel said Agreement as provided by the cancellation
clause of this Agreement.
H. INDEPENDENT CONTRACTOR
It is agreed that nothing herein contained is intended or should be construed in any manner
as creating or establishing the relationship of copartners between the parties hereto or as
constituting SEH as the agent, representative or employee of the HRA for any purpose or in
any manner whatsoever. SEH is to be and shall remain an independent contractor with
respect to all services performed under this Agreement.
SEH represents that it has, or will secure at its own expense, all personnel required in
performing services under this Agreement. Any and all personnel of SEH or other persons.
while engaged in the performance of any work or services required by SEH under this
Agreement, shall have no contractual relationship with the I -IRA and shall not be considered
employees of the HRA.
I'a(re No. 8
R
MODIFICATIONS
Any material alteration, modification, or variation shall be reduced to xvriting, as an
amendment and signed by the parties. Any alterations, modifications, or variations deemed
not to be material by agreement of the HRA and SEI -1 shall not require written approval-
MERGER
It is understood and agreed that the entire Agreement of the parties is contained here and that
this contract supersedes all oral agreements and negotiations between the parties relating to
this subject matter. All items referred to in this contract are incorporated or attached and
deemed to be part of the contract.
K. TERMINATION
This Agreement may be terminated by either party upon seven days' written notice should
the other party fail substantially to perform in accordance with its terms through no fault of
the party initiating the termination. In the event of termination, SEH shall be paid
compensation for services performed to termination date, including Reimbursable Expenses
then due and all terminal expenses.
L. FAILUIZE TO MAKE PAYMENTS
If the HRA fails to make any payment due SEH for services and expenses within thirty days
after receipt of SEH's statement therefor, SEH may, after giving seven days' written notice
to the HRA, suspend services under the Agreement until SEH has been paid in full all
amounts due for services, expenses, and charges.
Page N()_
SEII leaving signed this contract, and the City of Fridley Housing and Redevelopment
Authority leaving duly approved this contract on the day of
1996, and pursuant to such approval and the proper HRA officials
having signed this Contract, the parties hereto agree to be bound by the provisions herein set
forth.
APPROVED:
CITY OF FRIDLEY HRA, MN
BY:
Chairperson Date
Executive Director Date
ADDRESS FOR GIVING NOTICES:
6431 University Avenue NE
Fridley, MN 55432 -4383
RECOMMENDED FOR APPROVAL:
Public Works Director
SHORAELT-F EN N INC.
B Y : reiner, P.E.
Highway Department Manager
Principal
3535 Vadnais Center Drive
St. Paul, MN 55110
Page No. 10
m
z
a
a
x
0
3
r�
0
I
U i I
—
�
I li i
00
- { -- { —i— A I v
I I I
a j lI o
I i
J
j
� m
a i i I
1 i I
•� �O ,O N N V I I I!
vl 00
V C NO c� cry a to
2'
> Y
� •� G. 0.�, I I I � i � j � I I I )�
ii
0
° 2 I
a, j 11 3 a
a3i
y o oa .
� u C
m v I I I V
"O G CC
A W LW.
CO
to
on M o :� v° H u
Ev
ccc3�� 7 Q p v l,^. U o v T M T cc C mCm
It) CO M W ti V Cr d M L
� lo .c a
oz El
Ei
O U O v :r O y^ O O 7 v is M I� C .�? V C
75 IY I o
U; M c• I w N b 'O cJ p G U "' = j a] 3 0. 0..i O C) �"' �•
c
v]I JI v�
fV � I.0 T U � I' J � c•7 G � I� 1� v _� � j � ,? � �' II ��q � C V_�
G Itj 3 i4 y bl� I<. Icy lu �� -L r i� ;:1 •.fi c �I I�
,s Ir .� :J �� I ., G i 'd 4'
U
;i
N li _
m
C
w
r
0
T
V
b y
L �
G
C
J �
C �
CL `�
� o
d' ~
� L
RM
J
1
x
0
W
C
m
V'r1
f � O�
C
'T; Y 1 N 1
[�i
r' �� N C C` :
��� .--•
'
N
N
.-.
CD
1
I
I
t
m
O
O
N �O ' C O 00
00
�°
O
O
N
O
cn
�
O_.....--
�
7I
mi
CI,
I j
N.N
�
I
I
I
� U
E�!
G
r
C
C
r.
yL
U
y
G C
CO
v
-o
W
w
y
.a
w
C
a
n G
Z3
3
E
G
to
b
y
d
T
CL
Q
b
U
c2
p
>
v
E
'b �!
c it
`�
c
is
o
EO a 3
0 3 0
C r-7
rr
o
..
O.
E
2
o
v
o
y E
C)
U
C
3 T
v
.moo o'
CI (v
�v U�
y
a 'C1 i li
c
C
v
�
E9 �I
cIL
a
v
s
s
00
p
Q S I'
U
cV _
GI C J"
,n
_J J
C
J
J. C r
CXI
�
U
U�
I G
I
UI
'COC:
r
�
C
U
1
—
i
rZ,
RM
J
1
x
0
W
C
z
Q
x
t1:
9
U
U
C�
L
CL �
H
w
W-1 I
U
C
O
W
v
O
N
O
� I t-1
O
;M9
MEMORANDUM
HOUSING
REDEVELOPMENT
AUTHORITY
DATE: March 7, 1997
TO: William Burns, Executive Director of HRA ol�
FROM: Barbara Dacy, Community Development Director
SUBJECT: Tax Increment Financing Application, by Linn Property
Holdings, LLC
Steve Linn of Linn Property Holdings has filed a tax increment financing application to
create a TIF district to complete a redevelopment project on the north side of 57`h
Avenue. The developer has entered into purchase agreements for the former Dick's
Wheel and Tire building and three other lots to the west of Dick's Wheel and Tire. The
proposed redevelopment would renovate Dick's Tire into a Goodyear Service Center,
and the parcels to the west of the service center would be redeveloped into an 8,000
square foot retail mall.
The developer is taking on the acquisition, demolition, and site preparation costs to
complete the proposed project. This is truly a redevelopment project and not an
economic development project. The HRA, however, is not completing the
redevelopment activities such as acquisition, demolition, and parcel assembly. In order
to complete the project, the developer is requesting $200,000. How the assistance is to
be provided has not been determined.
Staff has asked for a pro forma on the retail strip mall and is currently reviewing the
materials attached to the TIF application.
The total project cost is $1,530,800. Of this amount, the developer identifies
approximately $452,850 of land acquisition and demolition expenses.
M
Linn Property TIF Application
March 7, 1997
Page 2
The developer has completed similar projects in Oakdale, Woodbury, Cottage Grove,
and Newport. The developer is now proposing sites in Fridley, Brooklyn Center, and
Blaine. Staff has taken photos of some of the other developments, and those will be
available for review at Thursday's meeting.
REVIEW PROCESS
The developer has filed concurrently a variance application for a variety of setback
variances for construction of the strip mall. A neighborhood meeting has been
scheduled for Tuesday, March 18, 1997 at 7:15 p.m. in the Council Chambers. Also,
the developer and Holiday Plus is funding an update to the 57" Avenue traffic study
which was completed in 1996 to assess the impact of the proposed development. It is
anticipated that the Appeals Commission will review the variance request on April 9,
1997.
Because of the timing of the establishment of the public hearing for the requested TIF
district, it was necessary for the City Council to pass a resolution establishing the public
hearing at its March 3, 1997 meeting for a public hearing on April 14, 1997. State
statute requires delivery of the TIF plan to Anoka County and the affected school district
30 days in advance of the public hearing. Therefore, the TIF process had to be initiated
prior to more serious consideration by the HRA.
Although more information needs to be verified, the initial tax increment analysis
completed by Mr. Casserly indicates that the increment from both of the projects could
generate up to $200,000 in tax increment. This is not to suggest that this is the amount
to be provided to the developer, and is not a recommendation at this time.
Rather, it is staff's goal to evaluate an approach whereby the district could "pay for
itself' and secondly, a pay -as- you -go approach be implemented as opposed to a grant
or a loan.
SUMMARY
The proposed project meets the requirements of state law regarding a redevelopment
district. Further, there are a significant amount of tax increment eligible
expenses, namely land acquisition, demolition, and parcel assembly. The remaining
issues to be resolved by the HRA are the amount of assistance to be provided to the
developer and, more importantly, the quality of the project which is to be constructed, if
approved by the City Council.
;.
Linn Property TIF Application
March 7, 1997
Page 3
There is no formal action required by the HRA at this time. A recommendation on the
assistance package and an update on the development package will be on the April
HRA agenda.
6 D /dw
M -97 -123
W
W Z
NW 'A3ldiFU
U (r
¢ m w
Y
. i. a _-
d� li - -
9° d?'.
3'N "3AV HIS
4 H31N331V1383NIW03
§
E�
O j Q
9 zzQQ5yy5S
HV3A4000
€ a
Mild 311S
i i 3
J
i
O
W
2 {
� ypi rp
Z
t
la
R
y�
L
Z
v
J
I
HsggK
r ;i4! 9§b
":
� Qai� ?�fiE4 €bli Yqji � ?ii�■
i
yYi�'Rr$ aal�m
i � �aa� .� ^aG Y4T `lbc si.`ieE
gY
Sit Y R OAS
b65 :
Y
p
^ DF
O r4'
WY ) 8
I
nill
O
O
m r
p Y {
o
I
yy [yC o
i � I YY q5k I G�pS 3
{
1S
s
% I 7
i I
'3
Y
1
;'N -is Hrvn
W
Z
yZyi
i�
Z
n
6
N
im
i
F jk
i � �aa� .� ^aG Y4T `lbc si.`ieE
gY
Sit Y R OAS
b65 :
Y
p
^ DF
O r4'
WY ) 8
I
nill
O
O
m r
p Y {
o
I
yy [yC o
i � I YY q5k I G�pS 3
{
1S
s
% I 7
i I
'3
Y
1
;'N -is Hrvn
W
Z
yZyi
i�
Z
n
6
N
im
i
F jk
I
nill
O
O
m r
p Y {
o
I
yy [yC o
i � I YY q5k I G�pS 3
{
1S
s
% I 7
i I
'3
Y
1
;'N -is Hrvn
W
Z
yZyi
i�
Z
n
6
N
im
i
F jk
I
yy [yC o
i � I YY q5k I G�pS 3
{
1S
s
% I 7
i I
'3
Y
1
;'N -is Hrvn
W
Z
yZyi
i�
Z
n
6
N
im
i
F jk
3 2
go
0 w z
ui FC w
CC ca -1
-j
Z:
AN 79AV HUS
•
Hy3A0009 V 831N30 -lVl3H3nV403
NV-ldAinun 'S ON IaVHO
EN
sir 9
6-
ka
-WE-
8r `s €�d
r
¢E
a
4
O
O
3t
�f
m.
V WE-
a
F
OR
FEW 21
MPA,
us
Y • j ` j;�aart HV3A000J 4 H31N301VIOH3ww00
�e Y
O � 3
SNOUVA913
8 jjG
9Y F
S� y�
8 �
Y
b
V y�
I "
�g ty
S P
I-- I
�y
101,
�1 I�
W�
o�
a
7
N
0
u
Wp
x—
Q
<
W [
d
Ey8 O
tloY O
N
xfE 0
` Q U
t¢ Wp
� y
K
< R
W cG
Oa
U�
OnO
N
O
J
U
Wp
x=
N
�t
W
Jo
Z
xp
N =
H �
6o i
rF
i
4
WL
x T-
N �
I i I I
Z
O
wW tp
<
3 G
m
O
F
W
F
W
L
J S.
i
C �
Off.
eveveve�!
!!b
-
!!ce!tl!ey'I
e!e�i�e!i
M,.,
8 jjG
9Y F
S� y�
8 �
Y
b
V y�
I "
�g ty
S P
I-- I
�y
101,
�1 I�
W�
o�
a
7
N
0
u
Wp
x—
Q
<
W [
d
Ey8 O
tloY O
N
xfE 0
` Q U
t¢ Wp
� y
K
< R
W cG
Oa
U�
OnO
N
O
J
U
Wp
x=
N
�t
W
Jo
Z
xp
N =
H �
6o i
rF
i
4
WL
x T-
N �
I i I I
Z
O
wW tp
<
3 G
m
O
F
W
F
W
L
J S.
i
C �
I
a.
------------------
-----------------
-___fl 101
'01
'K c4 faaw.
9 101
-- - - -- - - - - - - - - - - - - - - -
9 10, - - - - --
-- o - - - - - - - -
101
Sr-------- ----- - ---tip
f iol
♦ wl/
'Cov"
- - - - - - - -
'-= `---- ' -` - - --
3N YS -
ft
ti
Si
flE
R;
{ai
tpi
------------------
-----------------
-___fl 101
'01
'K c4 faaw.
9 101
-- - - -- - - - - - - - - - - - - - - -
9 10, - - - - --
-- o - - - - - - - -
101
Sr-------- ----- - ---tip
f iol
♦ wl/
'Cov"
- - - - - - - -
'-= `---- ' -` - - --
3N YS -
ft
ti
Si
flE
R;
{ai
tpi
z Jo
<
z.
< tic
w cl- W I
. - '! .:
OG z 0
C) 0 CD
w 0
77
.. —ff7
1 J:
'�'N I � D H iS N I V LN
6G
Lli
LLJ
-- - ------- - --
LO
9
6G
9
6G
APPLICATI411 q �_ } �r?X CI_EHEh' FZl'AN' -114G
Business Name: Lima Proix,rty ll��ldin7;s, L.L.C.
Address: 1561 Woodlane Drive, Woodbury, MN 55125
Type (Pa rtne rsh ip, etc.) : Limited f A q) -'i 1 ity Company
Representative:
Telephone:
Stephen L. Linn
731 -0515
Name of Counsel: Ken Rohlf - LeVander,
Ci_llen
& Miller
Name and Telephone of Accountant:
Joe
Cehlen,
888 -8256
List of Financial References: Name /Address /Contact /Telephone
Midway National Bank Mr. Rick Tol7rnann
14295 Cedar Avenue Annln Valley MN 55124
(612) 891 -8702
Other Comments Pertinent to Your Application: 'No (2) diffu in«
.
are covered under-this TIF zlQplicaLiojj. (1) Renovrjtion of "Dick's Tire"
(2) New Retail facility.
Have You Ever Filed for Bankruptcy? YeS No X
If Yes, provide details on separate sheet
Have You Ever Defaulted on any Loan Commitment? Yes No X
If Yes, provide details on separate sheet
'NEORMATION CONCEWING • g • • • ) pgOjECT
Location of Proposed Development: (Attach a Drawing)
Nature of Proposed Business: Runovation: Redo as a Goodyear Tire & Service
Center. New facility: Constnict MI outlet for retail use; leased to
Others.
6H
Principal Business or Product
of the
Company? Principal
Business is
ownershio/mana�)ement of convenience
Stores
auto service centers
and retail
strips (leased to others).
Is the Proposed Project a New Facility or Rehabilitation and /or
Expansion of Existing Facility?
Goodyear Tire & Service Center -rehab of Dick's Tire; Retail Building new facility
Industrial /Commercial /Residential: Commercial
What is the Present Employment of Your Firm: 150 emplovees
What is Your Estimate of Employment One Year After Completion of
Project: 15 new employees
What is Your Estimate of Employment Five Years After Completion of
Project: 20 new employees
Total Estimated Project Cost:
Total Estimated Construction Costs:
Potential Other Use(s) of Proposed Development: Goodyear Building -could
be labeled other users but building is specialized Re ail ildin� mul iple
uses
Will this Development Attract Other Related Industries:
Yes
How?
What Types?
No Probably not
What is the Current Zoning Status of the Project Site?
C -2 General Business District
In Rezoning, will Zoning Variances or Conditional Use Permits be
Required in Connection with the Project?
Variance shall be applied for against retail building
1WM
m
Is "eie Property Properly Subdivided for the Proposed Use?
Proponent shall have Fee Simple to Jots 2 through 13 enco��.passi_ng both
Pojects under current zoning
Has Site Approval been Obtained for this Project? No
If So, When? During April 1997
By Planning Commission? April 1997
By City Council? April 1997
Have You Applied for Conventional Financing for the Project?
Yes X No
If Yes, Provide Details on Separate Sheet, "H. Information to
Attach"
If No, Why Not?
Please include:
3i State Public Purpose
Description of Project
Schematic Drawing of Project
Breakdown of Project Costs
- Amount of Subsidy Request
Construction Schedule
Legal Description - (Include PIN's)
Other Pertinent Information
Depo . i t
-3-
L
r /
J
INFORMATION ATTACHMENT TO APPLICATION FORM
for
TAX INCREMENT FINANCING REQUESTED
by
LINN PROPERTY HOLDINGS
STATEMENT OF PUBLIC PURPOSE:
This twofold project shall serve the public by the renovation
and enhancement of the defunct /abandoned /disheveled 'Dick's Tire'
facility which has had a continuum of 'problems' during the past
serveral years. Similarly, the contigous development of the new
Retail facility will serve the public by its enhancement to this
significant retail trade area in the City of Fridley.
DESCRIPTION OF PROJECT:
The complete renovation /rejuvenation of 'Dick's Tire' into a
GOODYEAR TIRE & SERVICE CENTER reflects a goodly portion of this
project. A complete overhaul of the existing 8,640 square foot
facility shall be performed. Literally, every square foot of the
land and building (roof, parking lot and drives, facia, fencing,
curb cuts, interior walls /floors /ceilings, electrical /mechanical
systems, etc.) shall be addressed in this renovation.
The development of a new retail buildinV of approximately
8,000 square feet (which will be leased to either a singular or
to multiple tenants) shall be constructed to all City codes and
requirements for commercial facilities.
Both of the project components shall be performed in parallel
under a construction schedule beginning in late spring 1997. They
shall both open for business within 100 business days following
construction commencment.
The acquisition and renovation of 'Dick's Tire' will be more
expensive per square foot than first cost expense relative to the
new retail building. However, the new retail building will serve
to solidify, stabilize and enhance real estate value for capital
dollars placed into the new GOODYEAR TIRE & SERVICE CENTER.
And, although the acquisition and renovation of 'Dick's Tire'
was originally the total project pursued by the proponent, the
stability and enhancement caused by simultaneous development of
the retail building became a it necessity.
INFORMATION ATTACHMENT TO TIF APPLICATION
Page 2
BREAKDOWN OF PROJECT COSTS:
A. Land Purchase and Related Expense
(includes Correction /Demolishing Expense)
B. Purchase /Renovation - Service Center
(Building Hard Cost Expense)
C. Construction /Leaseholds - Retail Center
(Building Hard Cost Expense)
D. Project Soft Cost Expense totals
TOTAL PROJECT COSTS /EXPENSES
AMOUNT OF SUBSIDY REQUEST:
$ 452,850.00
$ 533,800.00
$ 464,000.00
$ 81,150.00
$ 1,530,800.00
To facilitate renovation and development as described above,
the amount of a subsidy requested for the project is $200,000.00.
r
t
I �,
MEMORANDUM
HOUSING
REDEVELOPMENT
AUTHORITY
DATE: March 7, 1997
TO: William Burns Executive Director of HR
A
FROM: Barbara Dacy, Community Development Director
SUBJECT: Potential Addition to Redevelopment Project Area
BACKGROUND
The City Council established a moratorium on warehouse and distribution facilities with
more than ten docks on January 27, 1997. The moratorium was adopted as a result of
extension development of warehouse and distribution facilities in the last 18 - 24
months. Approximately 500,000 square feet of warehouse facilities have been
constructed. The purpose of the moratorium is to examine industrially -zoned properties
and to determine the compatibility of warehouse facilities with residential uses which
may be located nearby. Secondly, the zoning on remaining vacant land is to be
evaluated to determine if warehouse and distribution facilities should be deleted from
the existing zoning districts.
STUDY RESULTS
The Planning staff completed an analysis as required by the moratorium and
recommended that the City Council pursue the following actions:
1. Amend the existing industrial zoning districts to prohibit loading docks to face public
right -of -ways when the site is a corner lot and adjacent to a residential district.
2. Establish a new industrial district, entitled "M -4, Manufacturing Only ", and rezone
remaining vacant parcels as appropriate.
These amendments will reduce the impact of truck traffic from warehouse and
distribution facilities on residential parcels. Pl irther, a manufacturing only zoning district
11
Addition to Redevelopment Project Area
March 7, 1997
Page 2
will encourage manufacturing uses which typically provide a significant amount of job
opportunities which typically have higher building valuations than warehouse
construction.
PROPOSED MODIFICATION TO THE REDEVELOPMENT PROJECT AREA
Of the City's 1,148 acres of industrially -zoned land, there are only 89.79 acres which
are vacant (7.8 %). The 1,148 acres represents about 17% of the City's land area.
There has been about a 4.5% decline in the amount of industrial land acreage since
1979 (Wal -Mart, Sam's Club, and Home Depot are examples of these industrial land
losses).
The small amount of industrial land raises an economic development concern. There
are few opportunities to maximize job creation and building valuation. Warehouse/
distribution facilities do not generate a significant amount of job opportunities. Further,
the building construction is very simple (intends to have a lower valuation than a
manufacturing use, which is a more complex building system with office areas,
manufacturing or processing areas, service areas for employees, and storage areas).
The existing M -1 and M -2 districts also permit a number of commercial uses which
would not create the value or job creation opportunities more typical of the
manufacturing uses.
Staff analyzed the remaining vacant land to determine which parcels should be rezoned
to encourage manufacturing development. A total of seven sites totaling 33.47 acres
are recommended to be rezoned to the M -4 designation. This is approximately 37% of
the remaining available industrial land.
It is proposed that these seven sites would be added to the redevelopment project area
as a signal to the business community that the City is willing to evaluate tax increment
financing assistance if the proposed project meets the state statute requirements.
Including the parcels in the project area at one time also represents a coordinated
planned approach to encourage manufacturers to locate within the community.
Adding the parcels to the project area would not bind the HRA in any way. In fact, there
are several parcels that are in the existing redevelopment project area which the HRA
has not provided assistance. Also remember that this proposal would not create a tax
increment financing district, but merely identify the site as where tax increment could be
spent.
NEWAII
Addition to Redevelopment Project Area
March 7, 1997
Page 3
PROCESS
The Planning Commission and the City Council have reviewed the staff analysis on a
preliminary basis, and have agreed to proceed with the public hearing process.
Planning staff will be having an informational meeting with the owners of the seven
sites recommended to be rezoned to M-4, Manufacturing Only, on Wednesday, March
12, 1997. If the Planning Commission and City Council ultimately approve creation of
these sites as manufacturing only sites, it is also recommended that the HRA pass a
resolution agreeing to add the sites to the redevelopment project area. According to
state law, the City Council would have to conduct a public hearing on the addition of the
sites to the project area and pass a resolution.
SUMMARY
No action is required by the HRA at this time; however, should you have any comments
or wish staff to research any questions, please let me know.
�@.A
M -97 -122
aN
`^rte«;: e.
MEMOR..A,NDUM
n t
�� �ii.���iik
ic
DEVELOPMENT DIRECTOR
opme
P
DATE_ February 14, 1997
TO: Planning Commission Members
FROM: Barbara Dacy, Community Development Director
Scott Hickok, Planning Coordinator
Michele McPherson, Planning Assistant
SUBJECT: Recommendations for the Industrial Land Moratorium
Moratorium on Warehouses or Distribution Facilities
Purpose
The City Council established the moratorium on warehouse and distribution facilities
with more than ten (10) docks at its January 27, 1997 meeting. The purpose of the
moratorium is two -fold:
1. To examine the industrially zoned properties within the City and determine
the compatibility of warehouse facilities with other allowable uses in the
vicinity.
2. Review the number and location of existing warehouse and distribution
facilities and determine if the zoning on remaining vacant land should be
amended or changed to another zoning classification_
Problem
Prompting the need for the moratorium was the recent development of approximately
500,000 square feet of warehouse facilities within the last eighteen months. As a result,
the number of resident complaints regarding truck traffic and the parking of trucks and
trailers near residential properties have increased. In 1996, the City Council
established several residential streets south of 53`d Avenue as "no truck traffic" routes
in response to the Murphy Warehouse facilities and other similar developments along
Main Street. Residents complained about the large numbers of trucks traveling through
the neighborhood, which caused additional noise and fumes.
There are several areas in the City where industrial districts are located directly across
the street from residential neighborhoods. Cumulatively, warehouse distribution
go
Industrial Land Recommendation
Planning Commission
February 14, 1997
Page 2
facilities can cause adverse impacts because of the amount of truck traffic entering and
leaving the area.
Of the City's 1,148 acres of industrially zoned land, there are only 89.79 acres which
are vacant (7.8). The 1,148 acres represents about 17% of the City's land area. There
has been about a 4.5% decline in the amount of industrial land acreage since 1979
(Wal -Mart, Sam's Club, and Home Depot are examples of these industrial land losses).
The small amount of remaining industrial land raises an economic development
concern. There are few opportunities to maximize job creation and building valuation.
Warehouse /distribution facilities do not generate a significant amount of job
opportunities. Further, the building construction is very simple (a "big box ") and tends
to have a lower valuation than a manufacturing use which has a more complex building
system with office areas, manufacturing or processing areas, service areas for
employees, and storage areas. The existing M -1 and M -2 districts also permit a
number of "commercial" uses which would not create the value or job creation
opportunities more typical of the manufacturing uses.
The City needs to balance the economic development concerns versus minimizing the
impacts to adjacent residential areas.
Goals of Potential Amendments
Any proposed ordinance change should meet the following goals:
1. Reduce the impact of warehouse and distribution facilities on residential properties
from truck traffic by:
a. controlling their location in the City; and,
b. by implementing site design controls.
2. Encourage uses which provide a significant amount of job opportunities and which
require more complex building systems (buildings with a mixture of uses tend to have
higher building valuations than warehouse construction).
3. Promote "clean" uses which do not produce fumes, odors, or require outside
operations which may cause noise.
4. Eliminate uses which require significant amounts of outdoor storage, display, or are
already permitted in other zoning districts (i.e. repair garages are permitted in
commercial districts
NVI
Industrial Land Recommendation
Planning Commission
February 14, 1997
Page 3
Analysis
Existing Developments and Remaining Vacant Land
For the purposes of this moratorium the City was divided into three industrial areas:
Area One: The area of the City bounded by 61s Avenue on the north, Main
Street on the east, East River Road on the west, and the City Limits on the
south. This industrial area straddles the railroad tracks.
Area Two: The area of the City bounded by 73`d Avenue on the north, the City
Limits on the east, Locke Park on the south, and the railroad tracks on the west.
This area also includes the industrial properties straddling Highway 65 north to
the City Limits.
Area Three: The area of the City bounded by 73`d Avenue on the south,
University Avenue on the east, the City Limits on the north, and East River Road
on the west. This area straddles the railroad tracks.
The following charts describe the amount of existing warehouse and distribution
facilities in each area, the acreage of remaining vacant land, the potential for the
expansion of existing facilities, and whether the site is near a residential area.
W
Industrial Land Recommendation
Planning Commission
February 14, 1997
`'age 4
Area One
EXISTING
POSSIBLE
AMOUNT OF
WHO IS
WAREHOUSE OR
EXPANSION
VACANT LAND
IMPACTED BY
DISTRIBUTION
OPPORTUNITY ON
ADJACENT TO
THE FACILITY?
FACILITIES
SITE
FACILITY
Murphy
No
7.11 acres north of
Residential
Warehouses 1 &2
facility.
properties across
177,950 & 266, 000
the street. No
square feet
docks face street.
Tri -Star Insulation
No
-None
Residential property
40,000 square feet
across the street.
(proposed)
No docks face
street.
API Supply
No
None
Residential property
140,238 square feet
across the street.
All -Temp
Minor
None
Residential property
_,000 square feet
across the street.
Perlman - Rocque
No
None
r
None
104,000 square feet
Quebecor
Minor
None
None
175,800 square feet
Barole Trucking
Currently under
2.7 acres
None
26,280 square feet
expansion to stated
-square feet.
Bunzl
No
None
None
100,800 square feet
There are 27.61 acres of vacant industrial land remaining in Area One.
EIN
Industrial Land Recommendation
Planning Commission
February 14, 1997
Page 5
Area Two
EXISTING
POSSIBLE
AMOUNT OF
WHO IS
WAREHOUSE OR
EXPANSION
VACANT LAND
IMPACTED BY
DISTRIBUTION
OPPORTUNITY ON
ADJACENT TO
THE FACILITY?
FACILITIES
SITE
FACILITY
Target
1,065,094 square
No
None
Residential property
across the street.
feet
ATS
Yes
3.81 acres to the
Residential property
5,600 square feet
north.
across the street.
Keuther
No
None
Locke Park
54,731 square feet
north.
park property
PenZoil
No
None
None
42,186 square feet
No
3.67 acres to the
None
Fridley Bus
Minor
3.81 acres to the
None
22,625 s uare feet
east.
There are 21.6 acres of vacant industrial land remaining in Area Two.
Area Three
EXISTING
POSSIBLE
AMOUNT OF
WHO IS
WAREHOUSE OR
EXPANSION
VACANT LAND
IMPACTED BY
DISTRIBUTION
OPPORTUNITY ON
ADJACENT TO
THE FACILITY?
FACILITIES
SITE
FACILITY
ANR/CCC
No
6 acres to the north
None
64,560 square feet
Joseph Land
Yes, substantial.
6 acres to the east.
None
16,140 square feet
Lindstrom Metric
No
1.63 acres to the
Residential and
35,000 square feet
north.
park property
across the street.
Gazda
No
3.67 acres to the
None
103,000 square feet I
west.
There are 34.6 acres of vacant industrial land remaining in Area Three.
EM
Industrial Land Recommendation
Planning Commission
February 14, 1997
Page 6
In addition to reviewing the number of warehouse and distribution facilities in each area
and their size, staff also reviewed the ratio of docks to floor area when compared to
manufacturing facilities. The average ratio of docks to floor area in a
warehouse /distribution facility is 1:5,339 square feet. In a manufacturing facility this
ratio increases to 1:14,293 square feet, almost three times as much floor area per dock.
This supports the theory that manufacturing facilities have less truck traffic than
warehouse /distribution facilities.
Ordinance Amendment Options
Five ordinance amendment options with the=ir fadvantages and disadvantages were
identified:
1. Do nothing
2. Amend district requirements for existing industrial zoning districts.
This amendment would establish more stringent development
requirements for corner lots and lots near adjacent residential districts. No
loading docks would be allowed to face the right of way.
3. Amend the M-1, Light Industrial and M -2, Heavy Industrial districts to allow
warehouses and distribution facilities as special uses only.
4. Amend the M-1, Light Industrial district to eliminate warehouses and
distribution facilities as permitted uses.
5. Create a new district entitled "M-4, Manufacturing Only ".
A new district would establish manufacturing as the primary use; warehouse
and distribution facilities would be incidental.
Amendment Options Advantages and Disadvantages
industrial Land Recommendation
Planning Commission
February 14, 1997
In order to effectively accomplish both the reduction of impacts by warehouse and
distribution facilities and the economic development goals, both Option 2 and Option 5
need to be pursued. This will allow the creation of more stringent development
standards for the remaining vacant land as well as for those properties that will
redevelop in the future.
Affected Properties
Once the amendment options were identified, staff analyzed the remaining vacant land
to determine which parcels should be rezoned to encourage manufacturing
development. The following criteria were used to evaluate the properties:
a Whether the property was adjacent to residential property.
IM
Industrial Land Recommendation
Planning Commission
February 14, 1997
Page 8
a Whether the property would meet the minimum requirements of a proposed M-4
District.
a Whether a proposed development would have more than 10 loading docks.
a Whether there is an adjacent warehouse /distribution facility.
A total of seven sites totaling 33.47 acres are recommended to be rezoned to the M-4
designation. This is approximately 37% of the remaining available industrial land.
Prior to ordinance adoption, staff would conduct an informational meeting with the
affected property owners. A recommendation will also be made to the City Council and
the HRA that these sites be included in the city's redevelopment project area for
possible TIF assistance (the project must meet State Statute requirements).
Recommendation
Staff recommends that the Planning Commission recommend the City Council pursue
the following actions:
1. Amend the existing industrial zoning districts to establish stricter standards for
corner lots and lots adjacent to residential districts.
2. Establish a new industrial district entitled "M-4, Manufacturing Only ", and rezone
parcels as appropriate.
Associated with the proposed amendments will be improved definitions for loading
docks, overhead doors, trucking terminals, and distribution facilities.
MEMORANDUM
HOUSING
AND
REDEVELOPMENT
AUTHORITY
DATE: March 7, 1997
TO: William W. Burns, Executive Director of the HRA
FROM: Barbara Dacy, Community Development Director
SUBJECT: Fridley Executive Center Update
Staff is continuing to follow through on the analysis requested by Chairperson Commers
to consider the tradeoffs in value and increment if a one story, high tech building is
located on a portion of the site versus 100% corporate office. Casserly has prepared a
number of scenarios which we shared with MEPC on Friday, February 28, 1997. The
next step will be to review with the HRA and Council a recommended assistance package
for the first office user. Information should be available by the April agenda.
.o
M -97 -116