HRA 03/13/1997 - 29796r''1
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CITY OF FRIDLEY
HOUSING & REDEVELOPMENT AUTHORITY NMEETING
1�iRCH 13 , 1997
CALL TO ORDER:
Chairperson Commers called the March 13, 1997, Housing and
Redevelopment Authority meeting to order at 7:38 p.m.
ROLL CALL:
Members Present:
Members Absent:
Larry Commers, Virginia Schnabel, John Meyer
Jim McFarland, Duane Prairie
Others Present: Barbara Dacy, Community Development Director
Jim Casserly, Financial Consultant
Craig Ellestad, Accountant
Margaret Metzdorff, 4400 Nokomis Avenue,
Minneapolis, MN
Gary Bidne, Noah's Ark Development
APPROVAL OF FEBRUARY 13, 1997, HOUSING AND REDEVELOPMENT AUTHORITY
MEETING:
MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve the
February 13, 1997, Housing and Redevelopment Authority minutes as
written.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COHIl�RS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
CONSENT AGENDA:
1. REVENUE AND EXPENSES
Mr. Ellestad distributed copies of additional expenses needing
approval as outlined in his memo dated March 13, 1997.
MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve the
Consent Agenda and additional expenses as outlined in Mr.
Ellestad's memo dated March 13, 1997.
VPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON CO1�Il�RS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
ACTION ITEMS•
2. CONS.IDER APPOINTMENT FOR REMODELING ADVISOR
� HOUSING & REDEVELOPMENT AUTSORITY MEETING, NIl�iRCH 13, 1997 PAGE 2
Ms. Dacy stated staff is recommending Ms. Margaret Metzdorff as
the Remodeling Advisor. She has six years experience in the
housing program for Minneapolis NRP. She has worked in several
neighborhoods in Minneapolis and administered historic
preservation and exterior improvement and abatement programs for
housing for these areas. She has also assisted homeowners in
evaluating a variety of improvements to their homes, conducted
property inspections, work write ups, construction specifications
and bid documentation. Over the course of her experience, she has
overseen a number of rehabilitation projects, has conducted
interim final inspections and monitored and authorized payment to
contractors. She has computer-aided design experience. She has a
Bachelor of Science in Housing from the University of Minnesota.
Ms. Dacy stated a copy of the contract was included in the agenda
packet. Staff has also distributed a copy of the final employment
contract. The contract is within the estimated budget for this
year. Staff recommends approval of the employment contract and
appointment of Ms. Metzdorff to the position, subject to the
approval of the service agreement with the City of Blaine EDA.
� Ms. Dacy stated the City of Blaine is willing to reimburse the HRA
for 450 of the Remodeling Advisor's position. Ms. Metzdorff will
be performing services for both the City of Fridley and the City
of Blaine.
Ms. Metzdorff stated, in addition to her work with the
neighborhoods in Minneapolis, she also did a nine-month internship
with the Dakota County HRA so she has experience in an HRA setting
as well.
Mr. Commers asked if the contract was agreeable.
Ms. Metzdorff stated the contract was agreeable.
Ms. Dacy stated Ms. Metzdorff would start work on March 31. Her
first task is the Home Remodeling Fair on April 5.
MOTION by Mr. Meyer, seconded by Ms. Schnabel, to approve the
Employment Contract for Remodeling Advisor, subject to approval of
the service agreement with the City of Blaine EDA.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON CONIl�RS DECLARED
THE MOTION CARRIED UNANIMOUSI�Y.
3. CONSIDER SERVICE AGREEMENT WITH THE CITY OF BLAINE EDA FOR
REMODELING ADVISOR
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Ms. Dacy stated she spoke with her counterpart today at the City
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of Blaine. The Blaine EDA meeting is scheduled for March 20. The
draft agreement handed out this evening is the agreed upon draft.
There were two minor changes to the agreement. The first change
was to item #2, Employing Agency and Work Assignments, where we
made it clear that the Remodeling Advisor is an employee of the
Fridley HRA. She and Mr. Fernelius will be providing all of the
specific work direction including performance evaluations. The
second change was in item 3#, Time Allocation, where a sentence
was added to assure the City of Blaine that vacation time would
not seriously affect the amount of time that would be provided at
Blaine, and to work cooperatively so that the position is shared
based on 24 hours in Fridley and 16 hours in Blaine.
Ms. Dacy stated staff recommends approval of the service agreement
as amended and presented.
MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve the
Agreement for Home Remodeling Advisor Services.
UPON A VOICE VOTE, ALL VOTING AYE, CAAIRPERSON CONIl�RS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
� 4. CONSIDER RESOLUTION FOR EXECUTION OF NOAH'S ARK DEVELOPMENT
CONTRACT
Ms. Dacy stated the parcel on which Noah's Ark is proposing to
build their project is located south of Wa1-Mart at the northwest
corner of 83rd Avenue and University. As the memo outlines,
Noah's Ark is requesting pay-as-you-go tax increment financing
from the HRA and is concurrently requesting a bond issue from the
City Council. The project would be a four-story building with 108
units. The total project cost is $9,600,000. According to the
bond requirements, 400 of the units must be rented to households
with incomes under 600 of inetro area median income. It will
provide housing for lower income seniors as well as moderate
income seniors. The affordable households will be taxed at a
lower tax rate of 2.3o and the remaining 600 of the units at 3.40.
About two-thirds of the 108 units will be one bedroom of a variety
of sizes and the remaining 36 will be two bedroom.
Ms. Dacy stated the developer has obtained variance approvals and
wetland approvals. We had to do a minor zoning text amendment to
adjust the parking ratios for senior housing. The bond issue is
to be considered by the City Council in April. As far as the pay-
as-you-go financing, there is enough time in the existing TIF
district to provide the requested amount of increment. The pay-
as-you-go approach puts the burden of risk on the developer. The
^ project has to be built first, then the HRA issues a note and uses
the tax increment to reimburse the developer. The increment to be
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SOUSING & REDEVELOPMENT AUTHORITY MEETING, MARCH 13, 1997 PAGE 4
used would be the increment that is to be created from this site
only.
Ms. Dacy stated, about six months ago, Mr. Commers asked staff to
do some history checking about our discussion regarding senior
housing in 1989. Staff did go back and verified that this project
is consistent with the thoughts that the City Council and HRA
discussed at that time. Staff were also asked to check with Mr.
Stutz from Rottlund Homes to see if this would be competing with
the Christenson Crossing development. His answer was no. Both
projects are aimed at different types of markets and serve to
complement one another.
Ms. Dacy stated staff is recommending that the HRA approve the
resolution to authorize the execution of a development contract
with Noah's Ark of Minnesota, Inc., subject to the approval of the
housing bond issue.
Mr. Bidne stated, on behalf of Noah's Ark Senior Housing, Inc., he
is delighted to be here. If you have had an opportunity to drive
further on Highway 10, you will notice a program currently under
construction which is 111 units of senior housing for Noah's Ark.
Noah's Ark is an interdenominational not-for-profit organization
seeking to assist in_providing and reaching out to this evolving,
growing need for senior housing where seniors are seeking to have
building-specific housing that is responding to their needs. They
do a number of things in the program that respect the aging
process in terms of providing a community. He thought that was
something they could do here with Waters Crest. They are going to
be in a position to have an abundance of common spaces so they are
attracting the seniors to come outside of their apartment area.
The apartments are fully appointed. They will have upon entering
the building a parlor, a foyer, a large multi-purpose dining room,
a private dining room area, a community kitchen, and on the second
floor via a grand staircase another large community area which
overlooks a two-story solarium in the northwest corner overlooking
Springbrook Nature Center. The building will have off street
parking and residents will have underground parking with a car
wash bay as well as the opportunity to go up the elevators which
are centrally located.
Mr. Bidne stated, prior to commencement of this program, Noah's
Ark secured additional market study research from the Maxwell
Research Group. They want to be good stewards of resources.
There is no need to construct a building unless they know that
individuals are going to occupy it and that it is going to be 100a
occupied. In Spring Lake Park, the market study there indicated
the demographics as they looked at seniors aging in place by and
large those 65 years of age and above are very strong in which
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both the Spring Lake Park and Fridley programs will not begin to
fulfill that need. In Spring Lake Park, they have well over 30
units pre-leased. During the spring months, they will start
growing by quantum leaps of over 15 to 20 units being pre-leased
per month because people are looking at transitioning. As the
president of Presbyterian Homes stated at the groundbreaking, he
hoped that those of you who have loved ones sign up because we end
up with long waiting lists. Once individuals can see how spacious
the apartments are and how spacious the commons are, that is going
to be a very marketable interest for those individuals.
Mr. Bidne stated in terms of rents they have had to factor their
rents out an additional year. They are confident they will be
exceeding the minimum requirements of 400 of the occupants being
at 60% of inedian income. In their previous programs, they have
found that this number has actually exceeded 70o in one program
and in another program exceeded 850 of the occupants meeting the
financial requirements. They have many seniors with modest
incomes, are no longer accumulating resources and are prepared to
guide more of those resources toward their dwelling unit and the
accouterments of security, safety, someone to check on them daily,
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Mr. Bidne stated they are designing to own this building in
perpetuity, to utilize maintenance free materials on the exterior
and high quality windows, so that as individuals can age in place
and Noah's Ark will have more resources to guide toward programs
rather than building and exterior. This is a bottom line program
of Noah's Ark. He is anticipating that the rents when the
building opens in the summer of 1998 will stay at the same level
for 1998 and most of 1999. Then they factored a 2.5o to 30
increase on an annual basis. They try to monitor that component
in order to keep their program as affordable as they can for all
the occupants. From that vantage point, they feel they are
providing spacious apartments for individuals, but it also needs
to be cost effective. With the assistance of the pay-as-you-go
financing, that will enable Noah's Ark to accomplish this program
and to work with you as this unfolds.
Ms. Schnabel asked if there would be rental units on all of the
floors.
Mr. Bidne stated yes. Apartments will be located on all four
floors. They have individuals who prefer to be on the first
floor, certainly for those that require handicap accessible
apartments. They also have individuals who prefer other floors
just as some like to have west or south exposures.
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Ms. Schnabel asked if there were specific handicap designed
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apartments available.
Mr. Bidne stated all apartments are being designed to meet the ADA
requirements. All bathrooms have the adequate circumference for a
wheelchair. They will have a minimum of 5% and, if they see
interest is greater, early on they can make the adjustments of
lowering the cabinetry and doing additional things to assure they
are able to be responsive to the needs of seniors that need the
handicap accessible apartments. In addition to bathrooms, the
kitchens have custom ovens and ranges with dials installed on the
front, and all outlets are lower. The structure is designed so
that, if you are sitting in a wheelchair or on a sofa, you can
look out because the windows are two feet off the floor. The
windows are large to allow a lot of natural light into the
apartments. They are sensitive to the needs of the residents
because they want to have the flexibility. They need a building
that is designed to age as gracefully as the residents. They have
gone to extremes to assure that they have buildings that are going
to be as marketable today as 20 years from now.
Ms. Schnabel asked if there would be a staff person on duty 24
�..� hours a day or a resident manager.
Mr. Bidne stated there is a resident manager which is 24 hours and
also full time staff coming in during business hours. They will
also be contracting with nearby clinics for medical health checks.
Individuals will come in usually once per month for blood pressure
checks, etc. They bring a lot of programmatic functions into the
building and also have areas designed in the building for that
purpose.
Mr. Commers asked if the anticipated leasing rates were on the
second page of the memo.
Mr. Casserly stated the 1998 lease rates are those that are
projected. Those follow from the 1997 rates that they are using
in Spring Lake Park. The 1998 rates are adjusted at about 3%.
Mr. Bidne stated one of the things they cannot control is interest
rates. If they found interest declining, there are two
parallelisms. One is that, given construction costs, for every
$100,000 they save in construction, they are able to adjust their
rents downward about $15 per month. If the interest rates make a
favorable adjustment, they can adjust rents downward. They are
very sensitive to how they can make the program affordable for
individuals. They try to have a litany of floor plans to suit
different incomes and different needs. Mr. Bidne provided a copy
�"1 of the roster of the board of directors and an organizational
chart of some of the other programs that Noah's Ark is involved
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with. Noah's Ark is concerned about being conscientious of
keeping the program affordably priced.
Mr. Commers asked if they had any currently operating projects in
the Twin City area.
Mr. Bidne stated they served as a consultant for Epiphany Pines in
Coon Rapids and Mayfield Presbyterian Homes in Little Canada.
They have been the developer of record and have orchestrated the
program, but Noah's Ark is the first where they are more closely
the developer and that first project is now under construction in
Spring Lake Park.
Ms. Schnabel stated this project seems to meet our test of four
projects. If it were not to proceed, the rents would not be as
low as they are projected without our assistance.
MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve 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 of Fridley and Noah's Ark of
� Minnesota, Inc.
UPON A VOICE VOTE, ALL VOTING AYE, CEAIRPERSON CONIl�RS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
5. CONSIDER CONTRACT FOR PREPARATION OF FINAL PLANS AND
SPECIFICATIONS FOR LAKE POINTE INTERSECTION
Mr. Commers stated he understands that one additional item that
may arise is the lighting that would be associated with this
intersection.
Mr. Dacy stated this was correct.
Mr. Commers asked if at this time the City had anything firm with
the State of Minnesota in terms of reimbursement.
Ms. Dacy stated no. Mr. Flora is trying to work out the details.
Staff's goal is to keep the costs at $380,000.
Ms. Schnabel asked when construction would start.
Ms. Dacy stated construction is planned to begin in spring of
1998. The project would be let for bids in December, 1997, with
construction starting in April, 1998. Ms. Dacy reviewed the plans
and changes proposed.
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Mr. Commers asked what the status was of the properties north of
�-� HOUSING & REDEVELOPMENT ALTTHORITY MEETING, 1�IlDiEtCH 13, 1997 PAGE 8
the intersection where old Central and Hackman come together.
Ms. Dacy stated there will be no changes. The HRA retained a
triangular piece of property and no other acquisitions are
planned. The HRA acquired some property on the west side a number
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of years ago so there is no acquisition planned to the
Planning Commission conducted an informational meeting
this proposal on February 19 which was well attended.
west. The
regarding
MOTION by Mr. Meyer, seconded by Ms. Schnabel, to approve the
Agreement for Engineering Services between the HRA and Short
Elliott Hendrickson, Inc., for Trunk Highway 65 from Trunk Highway
694 to Lake Pointe Drive in Anoka County, Minnesota.
UPON A VOICE VOTE, ALL VOTING AYE, CEAIRPERSON CO1�Il�RS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
INFORI�TION ITEMS•
6. UPDATE ON TIF REQUEST FOR REDEVELOPMENT ON 57TH AVENUE BY
STEVE LINN
Ms. Dacy stated she and Mr. Casserly have evaluated the
information submitted. They do not have a recommendation at this
time, but anticipate preparing a recommendation for the April
agenda. Mr. Linn has filed an application and a neighborhood
meeting will be held next Tuesday. The Appeals Commission will
hear a request on April 9. The next HRA meeting is April 10.
Mr. Commers asked what the nature was of the assistance expected
to be requested.
Ms. Dacy stated the application specifies an amount of $200,000.
The estimated project cost is approximately $1.5 million.
However, staff is reviewing that. There may be additional costs
Mr. Linn has not included.
Mr. Commers asked if Mr. Linn understands that we have not done
these types of projects before.
Ms. Dacy stated this is truly a redevelopment project in that he
is doing acquisition and parcel assembly. At the northeast
quadrant at University and Mississippi, a similar approach was
undertaken by the developer where the person tried to acquire
parcels in order to tie them together into one site and the HRA
evaluated an assistance package. If a district is created, it
would be a true redevelopment district.
Mr. Casserly stated, in this instance, it is not often that you
� HOUSING & REDEVELOPMENT AUTHORITY MEETING, MARCH 13 1997 PAGE 9
see redevelopment projects that are developer initiated. They
were not sure that this one was going to work but they are
approaching this as a redevelopment project. Classically, a
redevelopment project is one where the improvements are on the
site which create additional costs in the acquisition but do not
add anything to the value. That is what they are trying to
examine in this particular case. They are trying to figure out
what the site is worth free of the impediments that currently
exist.
Mr. Commers asked if this was going to be a tax increment request.
If so, what is the tax increment anticipated to be generated.
Mr. Dacy stated the total for the life of the district would be
approximately $225,000 in present value dollars.
Mr. Casserly stated it is not a great amount because the problem
is that structures are already there which need to be taken down.
This fits into very classic redevelopment.
Mr. Commers stated, if the project is a pay-as-you-go, what does
that mean under our guidelines.
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Mr. Casserly stated it does not fit the guidelines. This is a
redevelopment project. The guidelines deal with assistance for
economic development.
Mr. Casserly stated they have tried to distinguish between what
were redevelopment costs and what were development costs.
Mr. Meyer stated they talked last time about traffic on 57th. Are
you satisfied that this will not add to that traffic?
Ms. Dacy stated, with the City of Fridley as the client, they
hired BRW to evaluate this request in terms of traffic. The
developer and Holiday Plus are going to reimburse the City for
those costs. The strip mall being proposed is 8,000 square feet,
which is small for a center. At peak times, they estimate 20 car
trips in and 20 trips out which is a small use. A smaller amount
is anticipated for the service center. From University Avenue to
the main driveway to Holiday Plus, there are 16,000 vehicles per
day. From that main driveway west to Main Street, it drops to
8,000 vehicles per day. The amount of traffic generated by this
development will not significantly affect the traffic flows.
However, the City Council wants staff to evaluate some type of
construction improvement on 57th Avenue because there are so many
left turn movements and so many driveways. Aside from this
�� project, the City Council will evaluate pulling together the
owners for agreement on a construction project. One thing they
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talked about is a central left-hand turn lane down 57th.
7. POTENTIAL AMENDMENT TO REDEVELOPMENT PROJECT AREA
Ms. Dacy stated the City Council initiated a moratorium as a
result of warehouse and distribution facility development in the
city in the past 24 months. We have a lot of warehouse facilities
in industrial areas. The purpose of the moratorium was to
evaluate what was left for vacant land and to determine if we
should restrict zoning to prohibit those types of uses. The City
Council was very concerned about the truck traffic and the
pollution into the neighborhoods. Staff were to evaluate the
impact on residential areas. The analysis shows the city broken
into three areas, evaluated what is existing for warehouse
distribution, and analyzed what is vacant. Staff determined that,
of the 89 acres that remain vacant, some of those sites are across
from residential areas.
Ms. Dacy stated the Planning Commission at their next meeting is
to hear an ordinance amendment which, if you have an industrial
lot on a corner, loading docks can no longer face toward the
right-of-way. That eliminates the visual impact and reduces the
� number of docks. Second, the Planning Commission will evaluate a
fourth industrial zoning area, M-4 Manufacturing Only, which will
essentially permit manufacturing uses only and will prohibit
warehouse distribution and trucking terminals. Of those 89 acres,
there are 6 or 7 sites that we are suggesting be zoned as M-4. If
approved by the City Council and the Planning Commission, staff
would like to suggest to the HRA that you add these sites to the
redevelopment project area. This does not bind the HRA but allows
the HRA to provide a loan or perhaps establish a district which
meets State statutes. Staff saw that as an economic development
tool and the HRA will administratively see some of the
requirements. No action is proposed at this time.
Ms. Dacy stated at the April or May agenda, staff will update the
HRA as to how the City Council and Planning Commission acted
toward that proposal. The moratorium ends at the end of May and
staff are committed to try to resolve these issues by that time so
construction can continue.
Mr. Commers asked how this would affect potential projects such as
the warehouse for the railway.
Ms. Dacy stated that project would not be affected because is has
only one dock. The moratorium is for warehouse facilities with 10
or more docks.
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6 Ms. Schnabel stated there was no residential area across from that
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project.
Ms. Dacy stated residential is nearby. If there is a significant
amount of warehouse distribution within a short distance, they put
it in the manufacturing only category. The Target facility has
nearly one million square feet.
8. FRIDLEY EXECUTIVE CENTER UPDATE
Mr. Commers stated this is an ongoing analysis of the site. When
this is complete, please bring it to the HRA's attention.
OTHER BUSINESS•
9. COMMUNITY DEVELOPMENT NEWSLETTER
Mr. Commers stated the newsletter contains an announcement about
economic development and also the matter on 57th Avenue that is
pending before the City.
Ms. Dacy stated the newsletter is being distributed to all the
commissions.
ADJOURNMENT •
MOTION by Ms. Schnabel, seconded by Mr. Meyer, to adjourn the
meeting.
UPON A VOICE VOTE, ALL VOTING AYE, CBAIRPERSON CO1�RS DECLARED
TEE MOTION CARRIED AND TIIE MARCH 13, 1997, HOUSING AND
REDEVELOPMENT AUTHORITY MEETING ADJOURNED AT 8:33 P.M.
Respectfully submitted,
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Lavonn Cooper
Recording Secretary
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S I G N— I N 8 H E E T
HOIISING AND REDEVELOpMENT AIITHORITY MEETING, March 13, 1997
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