HRA 10/05/2000 - 6326PUBLIC COPY
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HOUSING & REDEVELOPMENT AUTHORITY MEETING
OCTOBER 5, 2000, MEETING, 7:30 P.M.
AGENDA
LOCATION: City Council Chambers
CALL TO ORDER:
ROLL CALL:
APPROVAL OF MINUTES:
September 7, 2000
CONSENT AGENDA:
Memorandun of Understanding with City of Columbia Heights
Regarding Joint Task Force Expenses ........................ ............................... 1
.,� Resolution Authorizing Redevelopment Grant
Application to DTED for Gateway East ........................ ............................... 2
Claimsand Expenses ........................................................ ............................... 3
PUBLIC HEARING:
� Conduct Public Hearing Regarding Sale of 530 Hugo St and Consider
Development Contract with Scott Olmstead Builders for 530 Hugo St ................. 4
ACTION ITEMS:
Master Plan Amendment and Project Plan Approval, Medtronic, Inc ........................... 5
INFORMATION:
Gateway East Redevelopment Project Update ....................... ............................... 6
Proposal by CEE to Administer Prevailing Wage Ordinance Requirements ................. 7
Potential Redevelopment Project; Former Lyndale Garden Center ............................ 8
OTHER BUSINESS
ADJOURNMENT
CITY OF FRIDLEY
HOUSING & REDEVELOPMENT AUTHORITY MEETING
SEPTEMBER 7, 2000
CALL TO ORDER:
Chairperson Commers called the September 7, 2000, Housing and Redevelopment
Authority meeting to order at 7:30 p.m.
ROLL CALL:
Members Present: Larry Commers, Virginia Schnabel, John Meyer, Jim McFarland
Pat Gabel
Members Absent: None,
Others Present: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
Clarissa Klug, Attorney
Julie Vogel, Accountant
APPROVAL OF THE AUGUST 3.2000, HOUSING AND REDEVELOPMENT
AUTHORITY MEETING MINUTES:
MOTION by Ms. Schnabel, seconded by Ms. Gabel, to approve the August 3, 2000,
Housing and Redevelopment Authority meeting minutes.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
CONSENT AGENDA:
1. CONTRACT WITH CEE FOR REVOLVING LOAN PROGRAM:
2. RESOLUTION AUTHORIZING HRA TAX LEVY FOR YEAR 2000 PAYABLE
2001:
3. CLAIMS AND EXPENSES:
MOTION by Mr. Meyer, seconded by Ms. Schnabel, to approve the consent agenda as
presented.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
HOUSING & REDEVELOPMENT AUTHORITY MEETING, SEPTEMBER 7, 2000 PAGE 2
ACTION ITEMS:
4. CONTRACT WITH HOISINGTON /KOEGLER/BONZ/REA/EHLERS AND
ASSOCIATES:
Ms. Dacy stated that the Joint Community Task Force was established this summer. It
is an 11 member task force consisting of representatives from Fridley and Columbia
Heights. The mission of the Task Force is to act as an advisory commission to look at
existing and future demographic and market trends. The goal is to identify ways how
the Cities can work together to take advantage of the opportunities presented by the
Medtronic campus or other identified issues.
Ms. Dacy stated that in July, the HRA authorized a contract and provided the funding for
the Fridley portion to hire Demographic Technologies, Inc. (DTI), to provide GIS data of
Fridley's population and household characteristics. The request tonight is for the HRA
to evaluate its share and hire a combination contract between a land use consultant,
marketing consultant, and a fiscal impact consultant. Hoisington /Koegler Group is a
Minneapolis -based landscape architecture and planning firm. Bonz/REA is out of
Boston, Mass. They specialize in real estate economics. They have extensive
experience with a number of large companies in the Boston area and elsewhere in the
country. Ehlers and Associates have done work for the HRA in the tax increment area.
Ms. Dacy stated that the consideration is to fund the consultant work program for the
land use and the marketing piece for the task force. They responded to the task force's
request for a proposal and seemed to be on the money in terms of what the task force
was asking for. The demographic information provided by the GIS consultant will be
used, and they will conduct research in the general market area around Fridley and the
Metropolitan area. They will interview Medtronic and do other research with "DTED"
and the Department of Economic Security. They will conduct a public workshop to get
input from the people in Columbia Heights and Fridley as a second step. Third, they will
analyze this information and make forecasts. In the end, they will talk about a
recommended list of ways that the Cities could cooperate. They will present a
recommended list of potential projects and try to space those out over 10 -20 years in
five year segments. They will be meeting with the task force potentially on a monthly
basis and hopefully culminate with a final report to the Columbia Heights and Fridley
City Councils in February or March, 2001.
Ms. Dacy stated the task force met on August 10, The HRA's representative, John
Meyer, was at the meeting. The task force suggested that the communities go ahead
and participate and accept a proposal from HKGI. They were impressed with the
experience of the consultants and their proposals seem to put together the right amount
of research.
Ms. Dacy stated that all of the partners talked about in the past have agreed to provide
their share of funding. Columbia Heights has agreed to provide their share of funding
for the demographic information. Anoka County has agreed to provide up to $20,000,
and the school districts each have contributed $2,500. DTI plus the land use and the
market cost would be approximately $49,798 and Columbia Heights at $24,132. Hilltop
HOUSING & REDEVELOPMENT AUTHORITY MEETING, SEPTEMBER 7, 2000 PAGE 3
is considering contributing $500 -$550. The suggestion is for the HRA to recommend
approval for entering into the contract with a consultant subject to a maximum of
$49,800 minus the Hilltop contribution. The other jurisdictions have agreed to make
their shares, so it is a matter now of receiving their money. They will be invoicing them
and receiving the checks this month.
Mr. Commers asked if Demographic Technologies, Inc., was a separate contract.
Ms. Dacy stated, yes. The Fridley share is $25,875 and the Columbia Heights share is
$18,055.
Mr. Commers asked what the $10,000 was that they just paid.
Ms. Dacy stated that was the initial invoice from the GIS consultant. That was toward
the total contract.
Mr. Commers asked if that would come off the $25,875.
Ms. Dacy stated that was correct.
Mr. Commers asked if the contract being approved tonight was the Hoisington contract?
Ms. Dacy stated that was correct.
Ms. Schnabel asked if the $49,798 included the $25,875 of which we have already paid
$10,000.
Ms. Dacy stated that was correct.
Mr. Meyer asked if the $54,500 includes the Bonz/REA/Ehlers contract also.
Ms. Dacy stated that was correct.
Mr. Meyer asked how they would work this being a Boston outfit.
Ms. Dacy stated that Dick Bonz and Dick Paik will be here. Mr. Paik is employed with
another client in Minnesota so, hopefully, they can take advantage of his time in
Minnesota. Mark Koegler of Hoisington / Koegler is the contact person along with Mike
Schroeder. They will be coordinating all the work. Bonz/REA will be responsible for the
market research, contacting DTED and interviewing Medtronic and all the market
analysis as part of the proposal.
Ms. Schnabel asked when they expect their final report to be put together.
Ms. Dacy stated that February, 2001, is the deadline, and the key to accomplishing that
will be the availability of the data from the GIS consultant. They are hoping that will be
finalized in November.
HOUSING & REDEVELOPMENT AUTHORITY MEETING, SEPTEMBER 7, 2000 PAGE 4
Mr. Meyer stated their report is due in February and there must be time after that for
thorough discussions before they start formulating recommendations.
Ms. Dacy stated the February deadline does include the formulation of
recommendations. The consultant work should be done in February or March. The
task force may choose to take more time with it and come up with other ideas or issues
to research. The task force would then go to each City Council to make the
presentation.
MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve the Hoisington /Koegler
Group, Inc. contract.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
4. CONSIDER TERM SHEET WITH REAL ESTATE EQUITIES FOR GATEWAY
EAST REDEVELOPMENT PROJECT:
Mr. Femelius stated that on August 24, staff met with representatives from Real Estate
Equities which is the developer for the Gateway East project. The purpose was to talk
about more of the significant issues that would form the backbone of the redevelopment
contract. A term sheet or the basic provisions of that agreement will be included in the
agenda for the October meeting. Twenty - eight "for sale" townhome units will be
constructed. Staff continues to work with the developer on unit design and quality
enhancements and details. They plan to have that finished before entering into the
development contract included as part of the contract agreement.
Mr. Fernelius stated the schedule calls for a construction start date by April 1, 2001.
The completion date is December 31, 2002. The developer would pay a dollar for the
site. The HRA would contribute $545,000 for infrastructure and site improvements. The
funds would be placed in an escrow account and the developer would draw down on
those funds to complete the public improvements as the work gets done. Those
improvements would include the streets, sidewalks, storm sewers, sanitary sewer, the
water mains and services, as well as lighting and signage. Other improvements are the
decorative fence similar to the Christenson Crossing project, shrubs, sod, trees and
irrigation. Any funds remaining in escrow would be returned to the HRA at the
completion of the site improvement work. One of the ideas is the concept of sharing in
the upside if the project is successful and if the developer is able to sell the units for
more than what they are projecting at $135,000 per unit. This revenue participation
plan would allow the HRA to recoup a portion of its investment in the project, specifically
the public improvements the HRA is going to pay for. The base amount would be
$3,780,000. Any amount above that is what the HRA would participate in.
Mr. Fernelius stated that the HRA would receive 70% of the first $140,000 over the base
revenue plus 60% of the next $140,000 over the base revenue, and 50% of the amount
thereafter. The theory behind the $140,000 is that it is equivalent to $5,000 per unit. If
the unit sold for $5,000 more than projected, the HRA would receive 70% of the first
$140,000 which equates to $98,000. The developer indicated they have concerns
HOUSING & REDEVELOPMENT AUTHORITY MEETING, SEPTEMBER 7, 2000 PAGE 5
about those percentages and are willing to discuss the idea of sharing the revenue.
Staff will continue to negotiate on the final designs and specifications of the units. Staff
will try to reach agreement on the major issues included in that contract and bring that
back for the October meeting review.
Mr. Commers asked if there was any information on what Fridley's housing needs are
for those that are living here and would like to remain here.
Mr. Fernelius asked if Mr. Commers meant what kind of demand there would be in a
market study.
Mr. Commers stated that was correct and in terms of what kind of home they would
afford.
Mr. Fernelius stated that the developer believes there will be a demand from existing
Fridley households. Young professionals and recent divorcees may consider these.
These are affordable guidelines based on the $135,000 Metropolitan Council standard.
Preliminary market analysis states that there would be demand from people living in the
community.
Mr. Commers asked if there was a study about whether the seniors who moved into
Christianson Crossing were able to afford them.
Ms. Dacy stated that they have not completed the household by household census and
the project as of the end of last year was sold out. The homeowners associations are
now formed and established.
Mr. Commers asked what level of family income is needed to qualify for a $140,000
house.
Mr. Burns stated that he thought it was no more than 35% of your income should go to
housing.
Mr. McFarland said that it is up to 50% with utilities and taxes with the monthly income.
Mr. Commers stated that on a $140,000 home with normal amortization, what would
someone generally have to have as an income?
Mr. Burns stated it depends on how much equity is put down.
Mr. Commers stated that he is assuming that minimum would be put down.
Ms. Vogel stated that 35% of $140,000 is $49,000.
Mr. McFarland stated that it would be in the area of a minimum of $25,000 pre -tax. With
taxes and everything else, it would be $25,000 - $30,000 annual income with one or two
wage earners.
HOUSING & REDEVELOPMENT AUTHORITY MEETING, SEPTEMBER 7, 2000 PAGE 6
Ms. Dacy stated that the two or three story project is not designed for an empty nester
or senior. There is a demand for that type of housing in Fridley. They may be attracting
employees that work in Fridley or plan to work in Fridley. It is a small project with only
28 units.
Mr. Commers stated that he heard a Planning Commission member state that there is a
big need for senior housing in Fridley. Are they targeting the wrong market? Maybe it
should be a more affordable type of property if there is that demand. They do not have
a lot of space for other projects for people if they are not able to afford a $140,000
home.
Mr. Burns stated that they have had the discussion at the staff level as well. To what
extent are they trying to satisfy the needs of Fridley residents in building new housing
versus to what extent are they trying to produce new value on Fridley property.? This
project is a good compromise but clearly is not directed to one or the other.
Mr. Commers stated it is directed away from the seniors.
Ms. Dacy stated that the City has 100 households at Village Green and 118 at Banfill
Crossing for the seniors.
Mr. Commers stated there is still an expressed need. He can see these going fast with
Medtronic employees. He just wants to make sure they are not sacrificing the needs of
the people that are here to bring in young professionals or others.
Ms. Dacy stated it is an issue of balance and the City could build senior housing all day
long and not fill it up, and they could build lower income housing all day long and not fill
it up. The HRA and the Council has to weigh the balance issue for seniors, affordable
house, and the market rate. The empty nester types of townhomes are one story and
they take up a lot of land. To get the same amount of units and density for those types
of homes, you need two to three times the land area to get a one story unit. They do
not have the land available anymore without requiring a significant amount of units for
businesses.
Ms. Schnabel asked why you would need two to three times the land for an empty
nester development.
Ms. Dacy stated that you try accomplish the same amount of square footage with one
story instead of two stories.
Mr. Commers stated they have to consider what they want to do. It is important to find
out what has occurred at Christianson Crossing, and they need information as soon as
they can regarding what the needs are. Maybe the place to start is at the Community
Center with some senior groups and maybe a questionnaire could be designed to see
what the needs are.
Mr. Burns stated that he has had recent conversation with the seniors at the Community
Center, and affordable housing is a huge issue for them.
HOUSING & REDEVELOPMENT AUTHORITY MEETING, SEPTEMBER 7, 2000 PAGE 7
Mr. Commers stated that he is concerned that staff should focus on where they know
there is an immediate need rather than on another type of housing need. They do not
want to force out people who have lived here for a long time.
Ms. Dacy stated that the City has responded to that need in at least three projects in the
last ten years.
Mr. Commers stated they better look at priorities and where to put the money.
Ms. Dacy stated that staff has heard another priority and the Gateway East is not set up
for a senior development type. The shape is odd and it is only 2.5 acres. Those are
two conflicting priorities, and they have responded to the image issue and overlay the
housing need on top of that. It is a significant financial contribution, but the trade -off is
that they may have to sacrifice other priorities in order to focus on housing needs. They
will go whatever direction_ the Council and HRA wants them to.
Mr. Commers stated that the HRA is not in the process of trying to change this project,
but in light of what seems to be coming to the surface here, they may be missing the
boat a little in addressing immediate needs. They better get on the ball and figure out
what it is and that may not be the way they should be directing our future focus.
Ms. Dacy stated that if they are missing an urgent need, the Gateway East site is more
of an affordable project. It may not be owner occupied, but a rental project.
Mr. Burns stated that the big problem with senior housing is land. Where do you find
land in Fridley to fulfill that option?
Ms. Dacy stated that you could put an apartment building on the Gateway East site and
go to a Noah's Ark developer and say they would like to replicate a senior project at that
location.
Ms. Gabel stated that she is someone who would be looking for a townhouse to stay in
Fridley but not this type of townhouse because she is an empty nester. She could
name 8 -10 people about her age who would like to stay in Fridley and get rid of their
houses.
Mr. Burns stated that the land for the one story senior model is not in Fridley.. They
may need to take a more regional approach to senior housing than just the Fridley
approach. Even land for high -rise senior housing is limited in Fridley.
Ms. Schnabel stated they could also do the condominium style as opposed to the
townhome approach.
Ms. Gabel stated that a lot of people do not want that.
Mr. Burns stated they have no vacant land and have had to buy existing buildings to
make these projects.
HOUSING & REDEVELOPMENT AUTHORITY MEETING, SEPTEMBER 7, 2000 PAGE 8
Ms. Dacy stated that she does not think they are missing the boat with this particular
product and market, and it addresses a different demographic in the City. It is a small
size project in a small place; however, if the HRA decides that the resources should be
focused on another type of demographic, they can start over.
Mr. Commers stated that he was not suggesting staff redo this project. He is
suggesting that information is coming to us to suggest that there is a big need in a
certain area, and he would like to get information about that need to test it and see if it is
real. If it is real, staff could start focusing on that need for the future. For example, the
salvage yards could be used for a project of that nature. Staff is creative and could
come up with ideas, but they have to identify the need first.
Mr. Bums stated this project is responsive to two trends in Fridley. They heard in the
early 90's that Fridley has a high proportion of younger single head of the household
families. The Medtronic project employees will need housing also.
Ms. Gabel asked why you would wait so long into the sale of 24 out of 28 units before
you talk about the accounting of the costs and profits.
Ms. Klug stated that was because it may take time to see how the market reacts and
you do not get a good picture if the cost will be under or over. It is a fair picture of what
the overall revenue will be as compared to the costs, and the final adjustment would be
made at the very end when the final unit is sold.
Ms. Gabel asked if a good picture could be made after 16 -18 are sold.
Ms. Klug stated that she thought it could be structured that way.
Ms. Gabel stated that she would hate to see it get that far down the line before
someone is taking a look at where it is really at.
Mr. Commers stated that it is hard to anticipate that there will be anything coming of
this. They are listed at what is the market value.
Ms. Gabel asked if this revenue participation is something that is done with this type of
development.
Mr. Fernelius stated this developer has done it on a couple of projects, and it is a way
for the public sector to recoup part of its investment and he understands there has been
some money available.
Mr. McFarland stated that as long as the investor has the properties and they are not
selling, it is costing them a little more money, so he will reduce the cost rather than raise
the price.
Mr. Meyer asked if this was an expected assistance of the $545,000 of additional
assistance.
HOUSING & REDEVELOPMENT AUTHORITY MEETING, SEPTEMBER 7, 2000 PAGE 9
Mr. Femelius stated that it was not a surprise. They knew the day that Real Estate
Equities submitted its proposal that there was a shortfall with their project and they
knew they would have to address it. The developer is saying that is the shortfall created
by building that particular unit on that site.
MOTION by Ms Gabel, seconded by Mr. Meyer, to approve the term sheet attached in
the packet for Gateway East Project redevelopment contract.
Mr. Meyer asked if the term "term sheet" is new. Does it signify that this is just a
preliminary document?
Ms. Dacy stated that was correct.
Ms. Klug stated that it was the basic terms.
Mr. Commers stated they should be careful in going about the kinds of appliances if it is
not stated very specifically.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
6. CONSIDER REQUEST TO INSTALL COMMUNITY SIGNAGE AT SOUTHWEST
CORNER OF UNIVERSITY AVENUE AND MISSISSIPPI STREET:
Ms. Dacy stated that the signs are under production right now. The exclamation point
will not be on the sign, but the contractor is Redwood Signs out of Osseo. We had
talked about it before, but because the estimate came in higher than what we had talked
about she put it back in the agenda. She does not have an estimate of the electrical
costs at this point in time.
Mr. Commers asked how big the sign is.
Ms. Dacy stated that they are three different sizes to match the locations. One sign will
be 5 x 10 feet or 50 square feet.
Mr. Commers asked how the lighting will be reflected on that.
Ms. Dacy stated that there will be a light fixture that will be placed at the bottom and
they are talking about fixtures in the back for back lighting. In the backdrop there are
the Colorado Spruce trees that will form a background.
Mr. Commers asked if they need landscaping around these to be maintained.
Ms. Dacy stated that the sign will be placed in the back of the limestone wall so the wall
will rise above the wall and the evergreens and lights will be in the back. The other
locations are on Highway 65, East River Road, and University Avenue.
HOUSING & REDEVELOPMENT AUTHORITY MEETING, SEPTEMBER 7, 2000 PAGE 10
Ms. Schnabel asked if all the signs would have a wall in front of them.
Ms. Dacy stated that they will not and each will be handled differently. They will be
landscaped.
Ms. Schnabel asked who would maintain the landscaping.
Ms. Dacy stated that the sign on East River Road will be located in the front yard of a
single family owner. The homeowner has said they would love to put flowers at the
base of the sign and take care of it. Mr. Hickok has been handling the issues of the
signs with the other owners. A couple of the signs are within the MnDOT right -of -way.
The City will pay for some maintenance and electrical cost for the sign on Highway 65.
Ms. Schnabel asked if there was a City garden club that might take this over.
Ms. Dacy stated she did not know.
_ft
Ms. Schnabel asked if at the top of the sign was the Banfil Locke House.
Ms. Dacy stated that was correct and it was painted.
Ms. Schnabel asked who maintained the paint on the whole scene.
Ms. Dacy stated the City will have to undertake that type of work. Some signs will have
brick columns instead of wood posts. It will have more of stately appearance.
Ms. Gabel stated that she still did not like the idea of the signs. It is a maintenance
nightmare; and if you do not live in Fridley, you will not understand the point of the white
house in the back.
Mr. Burns stated that the 50tt' Anniversary Committee met for well over a year and had
lengthy discussions. That was what they came up with.
Ms. Gabel stated that the sign in Shoreview is made of a lot of brick and mortar but is
very well done.
Mr. Burns stated that there are a number of Fridley Historical Society members on the
committee who felt strongly about the Banfill Locke House on that sign.
Mr. Meyer asked from what direction this would be read.
Ms. Dacy stated that it would be placed on the southwest comer and the primary view
would be the southbound traffic. East and westbound would have a better view.
Mr. Commers asked if it is the same design on all the signs.
Ms. Dacy stated, yes, but some have the brick and some have the wood.
HOUSING & REDEVELOPMENT AUTHORITY MEETING, SEPTEMBER 7, 2000 PAGE 11
Ms. Schnabel asked if they have to go through the request for approval with each sign.
Ms. Dacy answered that they do.
MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve the authorized
construction of the Welcome to Fridley sign.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
7. CONDUCT PUBLIC HEARING REGARDING SALE OF 530 HUGO STREET
AND CONSIDER DEVELOPMENT CONTRACT WITH SCOTT OLMSTEAD
BUILDERS FOR 530 HUGO STREET:
Mr. Fernelius stated that this item could be tabled for further discussion at a later date.
MOTION by Mr. Meyer, seconded by Ms. Schnabel, to table this item.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED UNANIMOUSLY.
OTHER BUSINESS
Ms. Dacy stated Julie Vogel will be taking a new position and is leaving Fridley. She
stated the City certainly appreciates the hard work and effort Ms. Vogel has contributed
to the City, and she will be missed.
Mr. Commers stated the HRA members want to express their thanks and appreciation
for Ms. Vogel's attendance at the HRA meetings for the past couple of years and for
doing such an excellent job. It has been a pleasure working with her.
ADJOURNMENT
MOTION by Ms. Schnabel, seconded by Ms. Gabel, to adjourn the meeting.
UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED
THE MOTION CARRIED AND THE SEPTEMBER 7, 2000, MEETING OF THE
HOUSING AND REDEVELOPMENT AUTHORITY WAS ADJOURNED AT 8:43 P.M.
Respectfully submitted,
Sign ` L. John n(
Recording Secretary
21 . R HOUSING AND REDEVELOPMENT
® AUTHORITY
Memorandum
Date: September 28, 2000
To: William W. Burns, Executive Director
From: Barbara Dacy, Community Development Director
Subject: Authorize Execution of Memorandum of Understanding with City of
Columbia Heights regarding Task Force Expenses
At the July meeting, the Authority approved the contract with Demographic
Technologies Inc. for the demographic and forecasting work needed for the Joint
Community Task Force (these included costs for both Columbia Heights and Fridley). At
the September meeting the Authority approved a contract with Hoisington Koegler
Group Inc. to complete the land use and marketing analysis. Attached is a
Memorandum of Understanding between the Authority and the City of Columbia Heights
identifying their financial share in the costs for both studies. The intent of the
Memorandum is to have a `simple" understanding about the financial arrangements of
the Columbia Heights payment to the Authority. It would also act as formal
documentation for auditing purposes.
RECOMMENDATION
Staff recommends the Authority approve the attached Memorandum of Understanding
with the City of Columbia Heights and authorize the Chairperson and Executive Director
to sign the Memorandum.
M -00 -158
I
MEMORANDUM OF UNDERSTANDING
This Memorandum of Understanding is made between the Fridley Housing and Redevelopment
Authority (hereinafter, the "HRA") and the City of Columbia Heights (hereinafter, the "City") on
this day of 2000.
Demographic Technologies, Inc. Master Service Agreement
The HRA agrees to execute a contract with Demographic Technologies, Inc. (hereinafter, "DTI")
in the amount of $43,900 for completion of the required tasks contained in the Master Service
Agreement executed between the Fridley HRA and DTI, (see attached Exhibit 1 of this
Memorandum).
The City agrees to pay $18,050 to the HRA as its share of the costs to be incurred by the HRA
for the services of DTI. Costs not covered by the Master Service Agreement include
unanticipated "direct" charges associated with acquiring city, county, state or school district data
sets; routine data conversion "consulting costs" performed by a third party vendor(s); any data
"consulting" processing or map production costs outside the Scope of Services and requested by
either the Joint Community Task Force or an individual city; and "consulting" support in excess
of the hours stipulated in the Scope of Services in the Master Service Agreement. All such
additional direct and/or consulting costs must be pre - approved, in writing, by the Fridley HRA,
the City of Fridley, and/or the City of Columbia Heights prior to DTI incurring such additional
charges. All such consulting costs will be billed to the Fridley HRA at a rate of $80 per hour and
all direct costs will be billed at the agreed upon direct costs for the item. The Fridley HRA and
the City shall share these costs in a manner as determined to be appropriate depending on the
nature of the additional charges.
The HRA acknowledges that the City is entitled to use and is a recipient of the information
created by DTI as defined in the Master Services Agreement.
Hoisington Koegler Group, Inc. Planning Consulting Services
The HRA agrees to execute a contract with Hoisington Koegler Group, Inc. (hereinafter HKGI)
in the amount of $54,500 to provide land use, marketing, and financial consulting services in
accordance with the terms of the Agreement dated September 7, 2000 (see attached Exhibit 2 of
this Memorandum). The City share of HKGI consulting costs shall be $6,082.
The HRA acknowledges that the City is entitled to use and is a recipient of the information and
work product created by HKGI as defined in the scope of services of said Agreement.
1 of 2
Except for any breach of the representations of the HRA, any willful misrepresentation of any
willful or wanton misconduct of the BRA, or the negligence or other wrongful act or omission of
any officers, agents, and employees of the HRA, the City agrees to indemnify and hold harmless
the HRA and its officers, agents, and employees against any claim, demand, suit, action, or other
proceeding arising pursuant to this Agreement resulting from actions or failures to act by the
HRA or its governing body members, officers, agents, or employees, provided that the foregoing
indemnification shall not be effective for any actions of the HRA that are not contemplated by
this Agreement.
The HRA agrees that the $24,132 to be paid by the City pursuant to this Agreement will be used
solely for the purpose of producing the information contained in the Agreements referenced
herein and attached hereto as exhibits. The HRA further agrees to refund any unused portion
collected under this Agreement.
CITY OF FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY
By
Lawrence R. Commers
Its Chairperson
By
William W. Burns
Its Executive Director
CITY OF COLUMBIA HEIGHTS
By
Gary L. Peterson
Its Mayor
By
Walter R. Fehst
Its City Manager
2 of 2
f= HOUSING AND REDEVELOPMENT
AUTHORITY
Memorandum
DATE: September 29, 2000
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Resolution Authorizing Redevelopment Grant Application to DTED
for Gateway East
The Redevelopment Grant Program was created by the State Legislature in 1998 to help
cities address their redevelopment needs. The program is administered by the
Minnesota Department of Trade and Economic Development (DTED) Brownfield's and
Community Assistance Unit.
The Grant funds must be used for eligible redevelopment activities such as acquisition,
relocation, demolition or public infrastructure improvements (i.e. roads, sewers, water,
etc.). The grant funds must be matched dollar for dollar by the local community.
Previous project expenditures by the city can be counted toward the match
requirement.
Staff prepared an application to help fund the infrastructure costs of the Gateway East
project which are estimated at $187,150. These costs would include public street
construction, water and sewer mains and storm sewer improvements. The DTED funds
would help off -set the net impact of the HRA's contribution toward the Gateway East
project which is $545,000. The DTED money would be provided in the form of a grant
to HRA, similar to the Onan /Murphy Warehouse project.
As you recall, last October we prepared an application for the Gateway East project, but
did not receive funding. The application deadline for this round of funding is October 1,
2000.
Recommendation
Staff recommends that the HRA approve the attached resolution authorizing application
to the DTED Redevelopment Grant Program for a grant of up to $187,150 for the
Gateway East project.
M -00 -160
HRA RESOLUTION NO. N - 2000
A RESOLUTION AUTHORIZING APPLICATION TO THE MINNESOTA
DEPARTMENT OF TRADE AND ECONOMIC DEVELOPMENT FOR THE
REDEVELOPMENT GRANT PROGRAM
WHEREAS, the Housing and Redevelopment Authority in and for the City of Fridley,
Minnesota (the "Authority ") is responsible for the redevelopment efforts within the City
of Fridley, Minnesota; and
WHEREAS, the Authority has identified the Gateway East Redevelopment Project (the
"Project ") to be a priority within the community.
NOW, THEREFORE, BE IT RESOLVED, by the Authority's Board of Commissioners,
as follows:
1. The Authority is the legal sponsor for the project contained in the Redevelopment
Grant Program application to be submitted on October 1, 2000.
2. The Executive Director of the Authority is authorized to submit an application to the
Minnesota Department of Trade and Economic Development for funding on behalf
of the Authority.
3. The Authority has the legal authority to apply for financial assistance, and the
institutional, managerial, and financial capability to ensure adequate project
administration.
4. The Authority affirms that the sources and amounts of the local match identified in
the application are committed to said project.
5. The Authority has not violated any Federal, State or local laws pertaining to fraud,
bribery, graft, kickbacks, collusion, conflict of interest or other unlawful or corrupt
practices.
6. That upon approval by the state, the Authority may enter into an agreement with the
State of Minnesota for the above referenced projects and that the Authority certifies
that it will comply with all applicable laws and regulations as stated in all contract
documents.
7. The Chair and the Executive Director of the Authority are hereby authorized to
execute such agreements as are necessary to implement the project on behalf of
the Authority.
PASSED AND ADOPTED BY THE HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF FRIDLEY, MINNESOTA THIS DAY OF
,20
LAWRENCE R. COMMERS, CHAIR
ATTEST:
WILLIAM W. BURNS, EXECUTIVE DIRECTOR
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;.5 HOUSING AND REDEVELOPMENT
AUTHORITY
Memorandum
DATE: September 29, 2000
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Sale of 530 Hugo Street and Authorization to Enter Into Contract
for Private Redevelopment with Scott Olmstead Builders
Staff has received a proposal from Scott Olmstead to build a home on the vacant
lot at 530 Hugo Street. This site was acquired by the HRA in 1995 and has
remained vacant since that time. In the last two years we have received two
proposals to construct homes on the site, but unfortunately both of those deals
have failed for reasons that will be discussed in this memo.
On Thursday evening the HRA will need to take three separate actions. First, it
will need to conduct a public hearing to review the proposed sale to Mr.
Olmstead. Second, after the public hearing is closed, the HRA will then need to
award the sale of the property to Olmstead, subject to the terms of
a redevelopment agreement. Third, the development agreement will also need
to be approved that same evening. The purpose of this memo to describe the
project and outline the approvals that will be required by the HRA.
Action #1: Conduct Public Public Hearing
Staff recommends that the HRA take following steps with regard to the public
hearing:
1. Open public hearing
2. Staff presentation
3. Close public hearing.
Builder's Proposal
Scott Olmstead Builders of Coon Rapids is proposing to construct a 1,265 square
foot home. The house will be a split entry design and have a two car attached
garage. The main level will have 3 bedrooms, 2 bathrooms, a living room, a
dining room and a kitchen. The lower level will be unfinished, but could be 4
530 Hugo Street Memo
September 29, 2000
Paae 2
converted into two additional bedrooms, plus a family room. The estimated
sales price of the home is $152,930 (including the price of the lot $31,000).
Staff has indicated to the builder that several changes are recommended for the
house in order to make it more compatible with the surrounding neighborhood
and meet the design guidelines of the program. In essence, the changes involve
1) moving the garage back to help minimize the garage door dominance 2)
2) adding a small porch detail to the front entry and 3) adding several windows
to the side elevation to help minimize the blank wall mass.
The builder has indicated that staffs changes will add cost to the project which his
buyer cannot afford. They are already at the maximum amount they can qualify for a
mortgage. Staff has requested that the builder provide an estimate of the additional
costs which would be used as the basis of re- negotiating the land price ($31,000). We
have used this approach on in the past (5861 Main St.). We will provide an update for
the Authority on Thursday night on the status of our negotiations.
In terms of the split entry design, staff believes that it is acceptable given the fact that
our geo- technical analysis as indicated that a high water table will limit the ability to
build a basement. The only option would be a split -entry design with daylight windows
or slab -on -grade construction with two stories. Given the limited options, a split entry
design is appropriate in this situation.
The builder does have a purchase agreement with a buyer who still needs to approve
the changes recommended by staff. We will also provide a copy of the revised house
plan on Thursday night.
Action #2: Award Sale of Property
Assuming that the house plans are acceptable, the HRA will need to award the
sale of the property to the builder. This action can be done by simple motion.
Recommendation: Staff recommends that the Authority award the sale of 530
Hugo St. to Scott Olmstead Builders, subject to execution of
a Contract for Private Redevelopment.
Action #3: Authorize Execution of Contract for Private Redevelopment
Attached is a draft of the Contract for Private Redevelopment by and between
the Authority and Scott Olmstead Builders. This agreement is identical to the
other contracts the Authority executed on sites such as 5857 Main Street
(Alliance Home Builders) and 1545 75th Avenue (Sussel Corp.).
530 Hugo Street Memo
September 29, 2000
Page 3
Terms of Agreement
The builder will pay $31,000 in cash for the property at closing. The HRA will
not carry any financing on the land. The builder will construct a home with a
minimum value of $125,000 (the price includes both the building and land). As a
practical matter, this should not be a problem since the home will have
a sales price of $152,000.
The developer must construct the home according to the plan approved by the
HRA, which will be attached as an exhibit to the final development agreement.
The date of closing, start of construction and completion dates have been left
blank in the draft agreement and still have to be negotiated. Generally, our
practice has been to convey title within 60 days of execution of the development
contract. The construction usually must be started within 30 days of closing and
the builder has 120 days to complete the home.
The agreement also contains standard language with regard to insurance
requirements and an indemnification clause protecting the Authority damage,
misconduct or negligence during the project. The agreement does have a right
of reverter clause which allows the Authority to revest title in the property should
the developer default and be unable to complete the project.
Recommendation: Staff recommends that the Authority approve the attached
resolution authorizing execution of a Contract for Private
Redevelopment with Scott Olmstead Builders, Inc. for
construction of a home at 530 Hugo St.
M -00 -161
HRA RESOLUTION NO. I I
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,
MINNESOTA AND SCOTT OLMSTEAD BUILDERS, 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 Scott Olmstead Builders, 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 seq.
2.02. The Authority hereby finds that it has approved and adopted a Housing Replacement District
Plan (the "Plan") and created Housing Replacement District No. 1, pursuant to and in accordance
with Laws of Minnesota 1995, Chapter 264, Article 5, Sections 44 through 47, inclusive, as
amended and supplemented from time to time.
2.03. The Authority hereby finds that it has performed all actions required by the applicable Minnesota
Statutes and has approved the sale of property that is subject to the terms of the Contract.
2.04. The Authority hereby finds that the Contract promotes the objectives as outlined in its
Redevelopment Program and the Plan.
Section 3. Authorization for Execution and Delivery of the Contract.
3.01. The Chairman and the Executive Director of the Authority (the "Officers ") are hereby
authorized to execute and deliver the Contract with such additions and modifications as
the Officers may deem desirable or necessary as evidenced by their execution.
PASSED AND ADOPTED BY THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND
FOR THE CITY OF FRIDLEY, MINNESOTA, THIS DAY OF , 20-.
LAWRENCE R. COMMERS - CHAIRMAN
ATTEST:
WILLIAM W. BURNS - EXECUTIVE DIRECTOR
G:\ WPDATA \F \FRIDLEY \25 \OLMSTEAD \DOC \RESOLUTION 2.DOC
fi N HOUSING AND REDEVELOPMENT
AUTHORITY
Memorandum
Date: September 28, 2000
To: William W. Burns, Executive Director
From: Barbara Dacy, Community Development Director
Subject: Master Plan Amendment and Project Plan Approval, Medtronic Inc. Day Care
Center
BASIS FOR REVIEW
Medtronic Inc. is requesting a minor amendment to its Master Plan for a free - standing day care
center within the campus of the new World Headquarters. The S -2 Redevelopment District
requires written staff review on project compatibility to the overall redevelopment plan, and a
"written Housing and Redevelopment Authority report" for City Council review.
The Planning Commission reviewed the request at its September 20, 2000 meeting, and
recommended approval subject to four stipulations (copy of the staff report attached). During
the preparation of final building plans, Medtronic was planning to locate a day care center
within the "campus commons" building. This building provides a variety of services for the
employees. Unfortunately, it was determined that the location of the day care center in
conjunction with the other uses of the campus commons building would pose too many conflicts
with the building code requirements. It was not possible to provide the appropriate area
separation walls and fire exiting required for a day care facility.
PROPOSED PROJECT
The day care facility is proposed to be located in the northwest part of the campus near the
southeast corner of the Medtronic Parkway and 7"' Street intersection. The building will be
11,270 square feet and will be licensed for up to 120 children, from infant to pre - school age.
The facility will be for Medtronic employees only. It is anticipated that employees from both the
existing campus at Rice Creek and the new campus will use this facility. The location of the
facility will not disrupt the location of future phases of construction. The original Master Plan
did not show any construction in this particular area except for a future parking ramp.
RECOMMENDATION
The day care center use itself was originally anticipated in the Master Plan, the only issue now
being discussed is where it is located. The staff recommended approval of the project and the
Planning Commission has also recommended approval. Staff recommends the Authority
recommend approval of the Master Plan and Project Plan amendment as presented. The
Council at its October 9, 2000 meeting will consider the item.
M -00 -157
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City of Fridley Land Use Application
MPA #00-01 September 15, 2000
GENERAL INFORMATION SPECIAL INFORMATION
Applicant:
Medtronic Inc.
3850 Victoria Street
Shoreview, MN 55126
Requested Action:
Master Plan Amendment and Project Plan
Approval in a S -2, Redevelopment District
Purpose:
To construct a free standing day care
center for Medtronic employees
Existing Zoning:
S -2, Redevelopment District
General Locations:
Southeast corner of Medtronic Parkway and 7"
Street
Size:
Part of total campus; 45 acres
Existing Land Use:
Corporate Headquarters
Surrounding Land Use & Zoning:
N: R -1, Single family
E: S-2, Corporate Hqtrs
S: I-694
W: Single and Multiple Family
Comprehensive
Plan Conformance:
Consistent with Plan
Zoning
Ordinance Conformance:
The S -2 District requires that all projects
proposed in the district receive "project
plan approval". The free standing day
care is also a change in the approved
Master Plan.
Legal Description of Property:
Fridley Executive Center Outlot A &
Outlot B.
Transportation:
The day care will derive access solely
from Medtronic Parkway.
Physical Characteristics:
Area has been graded by Medtronic as
part of construction.
SUMMARY OF PROJECT
During the building plan analysis of the Phase I
construction, it was determined that the day care
facility could not be accomadated within the
proposed buildings. A free standing facility at
the northwest corner of the site is the proposed
location.
STAFF RECOMMENDATION
City Staff recommends approval of the Master
Plan Amendment and nroiect nlan.
CITY COUNCII. ACTION
October 9, 2000
60 DAY DATE
October 17, 2000
Staff Report Prepared by: Barbara Dacy
MASTER PLAN AND PROJECT PLAN #00-01
Background
The City Council approved the Master Plan for the Medtronic World Headquarters on April 26,
1999. The Master Plan approved the construction of up to 1,600,000 square feet of corporate
facilities and three parking ramps. The first phase consists of approximately 500,000 square feet
and is nearing completion. Six buildings are under construction including a research building,
education building, corporate headquarters building, neurological building, a campus commons
building, and a central plant facility. A 1,000 car parking ramp is also under construction.
During the preparation of final building plans, Medtronic was planning to locate a day care center
within the "campus commons" building. This building provides a variety of services for the
employees. Unfortunately, it was determined that the location of the day care center in
conjunction with the other uses of the campus commons building would pose too many conflicts
with the building code requirements. It was not possible to provide the appropriate area
separation walls and fire exiting required for a day care facility.
Legal Basis for Review
Medtronic is requesting approval of a Master Plan amendment to locate a free - standing day care
center in the northwest part of the site. Second, the S -2 Redevelopment District requires that the
Planning Commission and City Council approved the "project plan" or site plan for each project
within the district. Because the master plan is to be amended, Medtronic is required to- submit the
project/site plan for review and approval.
Proposed Construction
The day care facility is proposed to be located in the northwest part of the campus near the
southeast corner of the Medtronic Parkway and 7s' Street intersection. The building will be
11,270 square feet and will be licensed for up to 120 children, from infant to pre - school age.
The facility will be for Medtronic employees only. It is anticipated that employees from both the
existing campus at Rice Creek and the new campus will use this facility.
The parking area includes a 10 space drop off area just to the east of the main entrance to the
facility. A covered walkway will be constructed between the entrance and the drop off area. The
westernmost driveway on Medtronic Parkway is about 180 feet from the 7h Street intersection.
The easternmost driveway is opposite a break in the median in the parkway and will provide full
movement access for cars exiting the site. The distance from the 7t' Street is adequate to handle
cars entering the site from the west.
A 34 -space parking lot is proposed to serve the facility. About 30 staff people will be working at
the facility. The parking area proposed at this time is a surface lot. In future phases, the lot will
be removed and the area would become part of the proposed parking ramp. Staff members would
then park in the ramp. The original Master Plan did not show any construction in this particular
area except for a future parking ramp.
The play areas are located on the north and south sides of the building and will be fully enclosed
by fencing/walls.
The engineering staff has reviewed the plans and the storm water plan and calculations are
satisfactory. The utility connections in 7* Street need to be completed by November 15, 2000 so
that the asphalt patch can be completed by winter. Medtronic intends to begin construction on
the facility as soon as possible in October so that it coincides as close as possible to the opening of
the campus facilities.
The exterior of the building will match the architecture of the existing buildings under
construction and will use the same materials.
Traffic
One resident called and was concerned by traffic impacts from the day care facility. The traffic
analysis that was completed by Medtronic during the review process used a campus size of
1,600,000 square feet and 20 -year projections. Because the day care facility is an employee used
only facility, there will not be additional trips other than the trips created by Medtronic employees
from the Rice Creek facility. Many families base their day care decision on where the day care is
located for the "trip home". It is hard to predict exactly how many will enter from 7h Street or
TH 65, but even with an even split of traffic, the day care center alone will not cause any adverse
traffic impacts. The day care traffic was fully anticipated in the original traffic analysis. The
same traffic patterns would occur even if the day care facility were to be located within the
buildings.
Staff Recommendation
City Staff recommends approval of the Master Plan Amendment and Project Pkm based on the
plans contained in this application with the follawing stipulations:
1. Utility connections to 7'h Street shall be made by November 15, 2000.
2. The dumpster shall be fully screened.
I The petitioner shall comply with all applicable licensing requirements.
4. A performance bond for the parking, landscaping, and irrigation improvements shall be
submitted in conjunction with the building permit.
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HOUSING AND REDEVELOPMENT
AUTHORITY
Memorandum
DATE: September 29, 2000
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Update on Gateway East Redevelopment Project
Staff is still in the process of negotiating with Real Estate Equities on the
Gateway East project. Our goal is to continue working with the developer on the
project details and have a development contract ready for the November
HRA meeting. If possible, we will try and have a draft of the agreement or
revised term sheet available on Thursday night. In the meantime, we can report
the following activities:
1. The developer is in the process of working with their architect and contractor to
revise the building and architectural plans to address the concerns that we
previously discussed. Staff has indicated that given the level of public assistance
for this project, we want a high quality project with as many quality
enhancement as possible (i.e. front porches, brick banding, etc.).
2. The revenue sharing concept we discussed in our initial proposal was
unacceptable to the developer. Instead, the developer is willing to a 50/50 split
of any profit after the project expenses (including their developer fee) are paid.
We are still reviewing the language they have drafted.
3. We are continuing to refine the list of TIF- eligible improvements which the HRA
will pay for. Staff has maintained that the HRA's participation in the site
improvements will be capped at $545,000 and the developer is responsible for
any costs above that figure.
4. As mentioned in a earlier memo, staff has prepared an application to DTED for
assistance with the project. The request is for up to $187,150 to help pay for
the public improvement portion of the project. If
successful, this could help offset nearly 1/3 of the HRH's contribution toward the
project.
Ctl
Gateway East Update Memo
September 29, 2000
Page 2
5. A letter was sent to Valvoline Rapid Oil regarding the Gateway East project and
the anticipated closure of their access to the service drive on the north side of
their site. We have not received a response to date.
6. The Council will conduct a public hearing on October 23, 2000 for creation of TIF
District No. 17 and consider the resolution to create the district at it's November
6t' meeting. The HRA will consider its corresponding resolution at their
November meeting.
7. Staff has submitted a request to the Parks and Recreation Commission to
approve removal of the trees on the Gateway East site. The Commission, along
with the Planning Commission and City Council, must approve the removal of
trees on public property. A majority of the trees cannot be saved due to their
location and in the interim staff has received a number of complaints about
children loitering on the site. We anticipate that a contractor would start the
work in late October or early November.
No action is needed by the HRA at this time.
M -00 -163
HOUSING AND REDEVELOPMENT
AUTHORITY
Memorandum
DATE: September 29, 2000
TO: William Burns, Executive Director of HRA
FROM: Barbara Dacy, Community Development Director
Grant Fernelius, Housing Coordinator
SUBJECT: Proposal by Center for Energy and Environment to Administer
Prevailing Wage Requirements for Gateway East Project.
At the joint HRA/City Council conference meeting on May 4, 2000, staff was directed to include
the City's Prevailing Wage Ordinance in the Gateway East Request for Proposals. As you know,
this ordinance requires that contractors working on City- sponsored projects pay their workers
prevailing wages as determined by the Minnesota Department of Labor and Industry.
The State's prevailing wage requirements are modeled after the federal Davis -Bacon Act, which
is fairly complex and paperwork intensive. From a practical standpoint there is no easy way to
enforce these standards, unless proactive steps are taken to monitor the contractor's
compliance. In reality, this means reviewing payroll forms on a weekly basis, interviewing
employees on the job site and conducting random audits over the life of the project. The issues
that came up during the Banfill Crossing project highlighted the importance of proactive
enforcement.
The impact of this ordinance does come with a price tag, however. Staff is not in the position
of enforcing these provisions without outside help. The nuances of the law and the time
required to oversee the project dictate that we hire experienced people.
Staff met with representatives from the Center for Energy and Environment's Sound Insulation
Program which is responsible for the Metropolitan Airport Commission's sound abatement
program at the Minneapolis /St. Paul airport. Since the program began several years ago, CEE
has monitored over 9,000 individual residential projects, each of which are covered by federal
labor standards.
In the case of Gateway East, CEE would be responsible for overseeing contractor compliance.
The attached spreadsheet outlines CEE's costs estimates for the project. At this point, CEE is
estimating that it could cost up to $15,000 to monitor the project from start to finish. Staff is
still in the process of reviewing the proposal and refining
the list of responsibilities. Unless otherwise directed, staff will begin drafting an agreement for
HRA approval at their November meeting, subject to our negotiations with Real Estate Equities.
M -00 -162 7
09/15/2000 10:58 FAX 812 72s 8422 CENTER FOR ENERGY ENVIR I1001
CENTER FOR ENERGY
avo ENVIRONMENT Sound Insulation Program
6307 34+h Avenue South Room 759 + Minneapolis, MN 55450 -2908 + (612) 725 -6255
September 15, 2000
Mr. Grant Fernelious
City of Fridley
6431 University Avenue NE
Fridley, MN 55432
Dear Grant,
Attached you will find CEE's proposal for the enforcement of Davis -Bacon prevailing
wage requirements per your request.
CEE has addressed those items listed on your fax dated August 28, 2000, and included a
line item for random quarterly audits and mileage reimbursement per our most recent
meeting.
You may contact either Chuck Rogers at 612- 725 -6242 or Lisa Ceplecha at 612 -725-
6252 to answer any questions you may have regarding this proposal.
'thank you for the opportunity to allow CEE to provide you with guidance and
enforcement of prevailing wages on your project. We look forward to discussing this
proposal in the near future.
Sincerely,
Lisa Ceplecha'
CEE Office Manager
encl.
09/15/2000 10:57 FAX 912 725 0422 — CENTER FOR ENERGY ENVIR @002
Proposal for Prevailing Wage Enforcement
City of Fridley /HRA
1) Obtain wage rates from MN Department of Labor - provide copies to
all parties involved. (Additional hours will be necessary to obtain wage
classifications if work types are not listed)
5 hours (LC)
2) Distribute blank payroll sheets, blank fringe forms, blank employee list
forms'- needed for verification of certified payroll forms.
Review forms when submitted.
3) Conduct training sessions
1.5 hours /per contractor (1S)
1.5 hours /per contractor (LC)
4) Payroll:
a) Review payroll on a weekly basis, maintain files
.25 hours /per payroll sheet (JS)
b) Follow up with contractors to address problems - obtain corrections
.50 hours /per payroll sheet (JS)
5) Interviews
a) Conduct on -site interviews 3 hours /mo (BM /LC)
h) Maintain records 1 hourlmo (JS)
6) Conduct investigations as directed =-
time and materials (LC)
7) Provide monthly update memo to HRA
3 -5 hours /month (LC)
8) Maintain custody of records - forward upon completion
material costs
9) Conduct random quarterly audits of GC /subcontractors to verify
payments to employees. GC /subs will be required to maintain
timecards, paychecks for review.
time and materials (LC)
09/15/2000 10:57 FAX 912 725 0422 CENTER FOR ENERGY ENVIR
Billing rates nee gMr:
jenny Stebbing
$35.00
Lisa Ceplecha
$65.00
Chuck Rogers
$110.00
Cindy Losasso
$50.00
Bob Mello (Construction Coordinator)
$65.00
Mileage imb irse nt:
.325 Cents per mile
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x HOUSING AND REDEVELOPMENT
® AUTHORITY
Memorandum
Date: September 28, 2000
To: William W. Burns, Executive Director
From: Barbara Dacy, Community Development Director
Subject: Potential Redevelopment Project; Former Lyndale Garden Center
BACKGROUND
The City created Tax Increment District #11 in 1991 in order to provide assistance for
redevelopment projects on both sides of Osborne Road and University Avenue.
Development agreements were approved for rehabilitation of the former Pet Food
Warehouse site south of Osborne Road, now primarily occupied by Tried and True Tools,
and for expansion of Bob's Produce and for redevelopment of the Lyndale Garden
Center. Bob's Produce completed its expansion in 1992 and added about 9,000 square
feet of retail space coupled with better and expanded parking areas. The Authority
provided tax increment assistance for soil correction expenses that totaled about
$90,000. The assistance was provided through a limited revenue note ("pay as you
go'l, and there are about 3 years remaining on the note. Lyndale Garden Center was to
have also redeveloped its adjacent parcel, but obviously, this project did not proceed.
PROPOSED REDEVELOPMENT PROJECTS
Staff has met with the Mike and Bob Schroer on several occasions and learned that they
are pursuing two projects that would, together, represent a significant improvement to
the City's commercial tax base. First, the Schroer's have purchased the University
Station restaurant site, and are evaluating building a 4,600 square foot, two- tenant
retail space (this parcel is not currently in the existing TIF District). The existing
structure would be destroyed and the new building would be large enough for two
users, one that could have a drive -up window. The Schroer's are currently in
negotiation with tenants and do not want to publicly reveal identities until all
arrangements have been finalized. The project will probably receive necessary land use
approvals this fall well in advance of the anticipated spring construction.
Second, the Schoer's have purchased the former Lyndale Garden Center lot and are now
evaluating construction of a 20,000 square foot retail facility. Potential uses include
general retail (4,800 square feet), new restaurant (5,000 square feet or larger), and an
area for warehouse expansion for Bob's Produce (10,000 square feet). Bob and Mike
Schroer hope to finalize the arrangements for this project this winter and aim for 2001
�0*1
Former Lyndale Garden Center
September 28, 2000
Page 2
construction. The strategy is to prioritize the University Station site first, construct it
first prior to the Lyndale Garden Center site.
REDEVELOPMENT ISSUES
In order to carry out the redevelopment of the Lyndale Garden Center site, tax
increment assistance will likely be needed, and a request to create a new district will
need to be made. It is not known at this time how much assistance is necessary;
however, staff completed a preliminary tax increment projection based on several
conservative assumptions as to value and timing. A 20,000 square foot expansion
could create a new commercial valuation of at least $1,500,000 versus the existing
$239,000 of value that exists on the parcel today. About $65,000 /year in taxes could be
generated. About $1,500,000 of tax increment with a present value of $400,000 can be
generated over the life of the district if construction is initiated in 2001.
A new district is required because of the rules that apply to the existing district. The
statutes that apply to this era of TIF districts require redevelopment activity within five
years of the creation of the district. After that point, new expenses cannot be incurred.
The Lyndale project did not happen within this time frame, and because the project was
not completed, the development agreement pertaining to the Lyndale parcel expired. A
new district, however, can be created. The "blighted" condition of the parcel still exists
as it did in 1991. The Authority and City would simply at the same time of creation of
the new district, decertify the Lyndale parcel from the existing district.
No action is required by the Authority at this time. The Authority should be aware,
however, that the owners might make application for assistance sometime this winter.
M -00 -159