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HRA 04/05/2007 - 6209AL11'C_ CITY OF FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY MEETING Thursday, April 5, 2007, 7:30 P.M. AGENDA LOCATION: Council Chambers (upper level) CALL TO ORDER: ROLL CALL: APPROVAL OF MINUTES: 1. Approval of February 1, 2007, Meeting Minutes ACTION: 2. Approval of expenses 3. TIF District #19 —Approval of Development Agreement INFORMATIONAL ITEMS: 4. Decertification of TIF District #14 —North Park Business Center 5. Gateway NE Update 6. Northstar TIF Legislation Update 7. Monthly Housing Report ADJOURNMENT: ACTION ITEM HRA MEETING - APRIL 512007 CrTY of FRIDLEY Date: March 30, 2007 To: William Burns, Executive Director , From: Paul Bolin, Asst. Executive HRA Director Scott Hickok, Community Development Director Subiect: Development Agreement for TIF DISTRICT #19 — Industrial Eauities Last months packet contained an updated version of the development agreement between the Authority and Industrial Equities for the redevelopment of 5110 Main Street. Attorney Casserly had made the corrections and changes requested by the HRA at their February meeting, in addition to incorporating minor changes proposed by Industrial Equities. As had been requested, detailed building elevations and site plans were included for your review. City Planning Staff has reviewed and approved the building elevations and landscaping plan, as they meet or exceed all City Codes. No additional changes were made to the agreement since you were provided a copy in last month's agenda packet. If you misplaced your copy from last month's packet, please e-mail or call and I will send you another copy. Mr. Allen has applied for his demolition permit and will likely begin demolition in the upcoming week. Recommendation: Staff recommends that the Authority adopt a resolution approving the development agreement between the Authority and Industrial Equities for the redevelopment of 5110 Main Street. FINANCE DEPARTMENT HOUSING AND REDEVELOPMENT AUTHORITY Memorandum DATE: 2/20/07 TO: William W. Bums Executive Director of HRA i1v FROM: Rick Pribyl, Finance Director Mike Jeziorski, HRA Accountant Paul Bolin, Assistant Director of HRA SUBJECT: County Notification of Natural Decertification of TIF #14 On 5/30/96 the HRA approved the Economic Development TIF district. #1 4—North Park Business Center. Throughout the district's life all associated project costs were paid using the increment provided. On 12/31/06 the district naturally expired and was decertified— leaving the district with an unused cash balance of $660,421.76. This cash was not able to be utilized in conjunction with other districts due to restrictions in place regarding this district. Staff has provided this brief memo in conjunction with the check that has been included within your check register for your approval. The amount of the check is for the unused cash balance of the fund which totals $660,421.76. This cash balance will be redistributed to the appropriate tax authorities (City, County, and School District) this July with the 1st half tax settlement. City of Fridley Northstar Station Background: The Fridley Station Site includes property on both the East and West sides of the Burlington Northern Santa Fe railroad (BNSF) tracks. The site on the West side of the tracks was used as an informal dump for construction debris and is contaminated. Other barriers to redevelopment include a number of blighted apartment buildings and a mixture of industrial and commercial land requiring expensive remediation and soils corrections. The biggest obstacles to redeveloping the rail site are the high costs of acquisition and relocation. Following is the cost breakdown for construction of the Fridley Station: Land acquisition: $ 3.3M Platform: 2.OM Vertical Integration (elevators and stairs) 1.0M Parking, landscaping, lighting 1.5M Engineering and technical. etc.: 22M TOTAL: $10.0M Public Purpose: Fridley residents will be able to take the train to work in Minneapolis, take in a Twins game, and transfer to light rail to get to the airport and Mall of America. The rail may eventually allow Fridley residents to access St. Cloud State for higher education. The station is very important to Fridley's current and future employers. Large employers (Medtronic, BAE Systems, Onan, Target) welcome this station site in Fridley because it will provide another option for their employees to get to work. Commuter rail service will allow these companies to attract and retain their workers. It is also important to the region and state. The success of the Northstar line is dependent upon usage. A stop in the City of Fridley would enhance ridership and thus safeguard this significant state and federal investment. It would also help to relieve congestion and promote improved environmental quality by providing commuter options. The center design of the Fridley Station will provide a safe crossway over the tracks for pedestrians even if they aren't taking the train. Extraordinary Costs: The Northstar Commuter Rail Development Authority (NCDA)' submitted their funding grant application to the Federal Transit Administration (FTA) and that application did not include funding for a Fridley Station. The Fridley Station was dropped after negotiations between the NCDA and the BNSF resulted in much higher easement costs than expected. BNSF dictated the need for an East -West design of the Fridley Station with a passenger platform in the middle of the tracks. Because of this requirement, a tunnel or a bridge/skyway will be needed to get passengers safely to the station. The result was a station design that was more expensive than the more typical design. This made the Fridley Station an easy target for elimination in the face of higher than expected costs for Northstar generally. While the NCDA has not asked for the City's help in funding the Fridley Station, they are quick to point out that the City's financial involvement would be a big help toward securing future state and federal funding. The most immediate aspect of the Station development is the $1M that is needed for the construction of the underground culvert and shafts that will be used to build a future tunnel and elevator access. NCDA has also asked the City to consider targeting the acquisition of land for the eastern portion of the station site. There are no City funds available for any of the Northstar station components. This leaves only Fridley Housing and Redevelopment Authority (HRA) Funds, which are limited. The City is willing to use some HRA funds and has applied for a recreation trails grant that could be put toward the underground work for the tunnel and elevator shafts. The tax increment piece of the City's proposal would go a long ways toward addressing the gap and leveraging other sources of funds for the project. Considerable efficiencies and leveraging prospects, as well as state and federal funding, could be lost absent the City's ability to generate the additional tax increment resources. Proposed Legislation: The proposed legislation would allow the City to establish a geographically defined redevelopment district that encompasses three existing post -1990 redevelopment districts. Revenues generated in these existing districts could contribute up to $2.5M in current and future revenues to be used throughout the new district boundaries to develop the Northstar Transit Station and the surrounding area. This will require some amendments to current law: (1) the definition of eligible costs is expanded to include costs necessary for the development of or expanded use of a transit station; (2) pooling flexibility is provided; (3) the five year rule does not apply; and (4) the need to use revenues from three aforementioned existing districts for decertification is eliminated. Northstar Transit Station to be Located on Parcels #19 -24 and #36 -38 City Of Fridley Proposed Transit u 4 TIF Distnot I Yt iR vi—y Y—i a a . ( Uj ,gyp N }0 1€M 1'500 2,1J 1 W " F E _ Feet 3 r) INFORMATIONAL ITEM HRA MEETING OF APRIL 512007 CRY OF FRIDLEY Date: March 29, 2007 11�� To: William Burns, City Manager Ttl�i From: Paul Bolin, Asst. Executive HRA Director Scott Hickok, Community Development Director Subiect: Gatewav Northeast Update Corridor Housing Initiative Staff is meeting with Gretchen Nicholls on April 10th to begin developing the framework and timeframe for the University Avenue study. We anticipate having the timeframe and particulars of the study fully developed prior to the HRH's May meeting. Property Purchases Staff successfully closed on 6041 University (old Van- o -Lite /Unplugged Cities) on February 28th and 5945 University (new Van- o -Lite) on March 12th. Staff had anticipated receiving a signed purchase agreement from the Oriental House restaurant, but recently learned that the Sikh Society had also made a conditional offer on the property. Mr. Kim of the Tae Kwan Do Center still has not responded to the offer delivered on January 29th. The good news is that acquisition of this property is not necessary to move forward with the Corridor Housing Initiative planning study for this area. If Mr. Kim is not enthusiastic to sell his property, as he had previously indicated, we will welcome his participation in the future planning for this corridor. A INFORMATIONAL ITEM AJ HRA MEETING - APRIL 59 2007 CITY OF FRIDLEY 1JaLG: 1V1arcII LJ, LUU / To: William Burns, Executive Director( BRA Board of Commissioners From: Paul Bolin, Asst. Executive BRA Director Scott Hickok, Community Development Director Subiect: Northstar Funding — Legislative Update Since the snowy night of March 1 s, staff has been busy working with our legal counsel and local policy makers in moving forward with special legislation to fund portions of Fridley's Northstar Station site. At this time the legislation has been introduced and had hearings in both the House & Senate Tax Committees. The legislation will be included in both the House & Senate Omnibus Tax bills. The legislation that was drafted (attached to this memo) created a TIF Transit District that included the rail site, Islands of Peace, Georgetown, JLT, and Home Depot. Successful passage of this legislation and the creation of this district would allow the BRA/City to accomplish much more than just the construction of the rail station. Representatives Laine and Tillberry have been very supportive of the legislation. The House Tax Committee passed the legislation exactly as it was proposed. On the Senate side, Senator Chaudhary has not been as supportive as we had hoped and has stripped away most of the proposed language. Senator Chaudhary does not think that the City should be using local dollars for any construction of the station site. After two hearings before the Senate Tax Committee, our language was changed to allow only the construction of the tunnel with local dollars. Senator Moua of St. Paul saw the benefit to Fridley and kindly had the revised language included in the Senate's Omnibus Tax Bill. Staff is hopeful that the final bill coming out of the Conference Committee more closely resembles the House version. Senator Chaudhary has introduced an amendment to the Transportation Bill that simply requires Northstar to construct a Fridley station. However, there is no funding mechanism attached. Staff is very concerned that this language could derail the entire Northstar project if it were to be approved. If the NCDA is forced to build the Fridley Station with no additional funding provided by the State, it will jeopardize their Federal Funding. City Staff and NCDA representatives have made this concern known to Senator Chaudhary. At this time he plans to keep pushing his amendment. Staff will continue to follow the proposed legislation and work to end up with a bill that closely resembles the language originally presented to the House and Senate. For those that are interested in following the legislation, it can be accessed by using the following web addresses. House Version of Bill: h : / /www.revisor.le .state.mn.us/binibldbill. h ?bill= H2121.O.htm1 &session =1s85 Senate Version of Bill: hllp://www.revisor.leg.state.mn.us/binibldbill.php?bill=S 1 872.0.btml&session--ls85 Chaudhary Transportation Amendment: http:Hros leg.mn/bin/bldbill php ?bill =S 1943.0.html &session =1s85 S.F. No. 1872, as introduced - 85th Legislative Session (2007 -2008) I V e, rs &� �/,- rs1b'. %,✓e. f -ro fos4 1.1 A bill for an act 1.2 relating to the city of Fridley; authorizing a tax increment financing district. 1.3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 1.4 Section 1. CITY OF FRIDLEY, TAX INCREMENT FINANCING DISTRICT; 1.5 SPECIAL RULES. 1.6 (a) If the city elects upon the adoption of a tax increment financing plan for a district, 1.7 the rules under this section apply to a redevelopment tax increment financing district 1.8 established by the city of Fridley or the housing and redevelopment authority of the city, 1.9 The redevelopment tax increment district includes the following parcels and adjacent 1.10 railroad properly and shall be referred to as the Northstar Transit Station District: parcel 1.11 numbers 223024120010 223024120009,223024120017 223024120016 223024120018 1.12 223024120012 ,223024120011,223024120005 223024120004 223024120003 1.13 223024120013,223024120008 223024120007 223024120006 223024130005 1.14 223024130010 ,223024130011,223024130003 153024440039 153024440037 1.15 153024440041 ,153024440042,223024110013 223024110016 223024110017 1.16 223024140008 ,223024130002,223024420004 223024410002 223024410003 1.17 223024110008 ,223024110007,223024110019 223024110018 223024110003 1.18 223024140003, 223024140009, 223024140002 223024140010 and 223024410007 1.19 (b) The requirements for qualifying a redevelopment tax increment district under 1.20 Minnesota Statutes, section 469.174 subdivision 10 do not apply to the parcels located 1.21 within the Northstar Transit Station District which are deemed eligible for inclusion 1.22 in a redevelopment tax increment district. 1.23 (c) In addition to the costs permitted by Minnesota Statutes section 469.176, 1.24 subdivision 4j, eligible expenditures within the Northstar Transit Station District include Section 1. S.F. No. 1872, as introduced - 85th Legislative Session (2007 -2008) 2.1 those costs necessary to provide for the development or ex anded use of a transfer station. 2.2 For purposes of this subdivision transfer station means a physical structure or designated 2.3 area that supports the interconnection of various transportation modes including light 2.4 rail commuter rail and bus rapid transit, and that promotes and achieves the loading,. 2.5 discharging and transporting of people. 2.6 d Notwithstanding the provisions of Minnesota Statutes section 469.1763 2.7 subdivision 2 the city of Fridley may expend increments generated from its tax increment 2.8 financing districts numbers 11 12 and 13 for costs permitted by paragraph (c) and 2.9 Minnesota Statutes section 469.176, subdivision 4i outside the boundaries of tax 2.10 increment financing districts numbers 11 12 and 13 but only within the Northstar 2.11 Transit Station District. 2.12 (e) The five-year rule under Minnesota Statutes section 469.1763 subdivision 3, 2.13 does not apply to the Northstar Transit Station District or to tax increment financing 2.14 districts numbers 11, 12, and 13. 2.15 (f ) The use of revenues for decertification under Minnesota Statutes, section 2.16 469 1763 subdivision 4 does not apply to tax increment financing districts numbers 2.17 11, 12, and 13. 2.18 EFFECTIVE DATE. This section is effective upon approval by the governing body 2.19 of the city of Fridley and upon compliance by the city with Minnesota Statutes, section 2.20 645.021, subdivision 3. Section 1. 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 S.F. No. 1943, as introduced - 85th Legislative Session (2007 -2008) 5e.vtv'�r 0^Cxtj",r1,5 -rya v,5 P° A bill for an act relating to transportation; requiring construction of Fridley station on Northstar Corridor Commuter Rail Line. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: Section 1. NORTHSTAR CORRIDOR COMMUTER RAIL STATION. The commissioner of transportation shall incorporate a station located in the city of Fridley in final design plans and construction of the Northstar Corridor Commuter Rail Line. EFFECTIVE DATE. This section is effective the day following final enactment Section 1. N Fridley HRA Housing Program Summary Cover Page April 5, 2007 HRA Meeting Report Description Loan Application Summary Loan application activity (e.g. mailed out, in process, closed loans) for March, 2007 and year -to -date. Loan Origination Report Remodeling Advisor & Operation Insulation Loan originations for March 2007 and year -to -date. Shows the number of field appointments scheduled and completed the Operation Insulation and Remodeling Advisor Services administered by Center for Energy and Environment. H:\—Paul's Documents \HRA\IiRA Agenda Items\2006\June 1, 2006\Housing Program Cover Page(June06).doc t 0000�0�-00j N N � C d la N J V N C .a O W CO C CD CD 0 0 LO N 20 0 Q v C. O ¢a N C C:) 0 0 �- 0 0 0 0 CL R V � O CL N I-- Q 2 0000 �00001 v- V N C 0 R N JU N C N O N00000000 N V .a O Qua C Q � c 2 N C L ±' O r (0 C) C) X 0 0 0 OD 3 O CL C�, c tQ z a n u a o -- ca N c V ~ c LL LL o LL > > m o O K O O U cCCo C LL C a�+JLL R LL J .� .Ll A X E T J o� c'��.c i G 0) J LL 7 Jar C 'a C L C' E W -lie m— •' Ec L? E Qi C R G ^ CL E > m K E m m 0 U �QOiru r�� N 'i Q C LLLLLLW;LL � O LL a L IL Z == W L= == L 0 a G s r Fridley HRA Loan Origination Report March 29, 2007 Loan Orlginations This Previous Month Months YTD HRA Loans (incl. CFUF Dicscount loans) 1 _ 1 HRA Deferred Loans Other Loans (non -HRA) 1 1 Total 1 1 2 Funding Sources Types of Improvements Interior # of Projects % of Total Bathroom remodel _ 0% This Previous General plumbing _ 0% Heating system 1 33% Month Months Basement finish YTD Fridley HRA $ 36.03 $ - $ 36.03 MHFA $ 2,500 $ - $ 2,500 Met Council $ _ $ _ $ _ CDBG/HOME $ _ $ _ $ _ CEE $ - $ 15,000 $ 15,000 Other $ _ $ $ Total $ 2,536.03 $ 15,000.00 $ 17,536.03 Types of Units Improved` *some households receive more than 1 loan, so the # of loans may not equal # of units Improved This Previous Month Months YTD Single Family 1 1 2 Duplex _ Tri-Plex _ 4 to 9 Units _ 10 to 20 Units _ 20+ Units _ Total 1 1 2 Types of Improvements Interior # of Projects % of Total Bathroom remodel _ 0% Kitchen remodel 1 33% General plumbing _ 0% Heating system 1 33% Electrical system _ 0% Basement finish _ poi, Insulation - poop Room addition _ 0% Misc. interior projects 1 '33% Exterior Siding /Fascia/Soffit _ 0% Roofing - 0% Windows/Doors _ 0% Garage _ 0% Driveway /sidewalk _ polo Landscaping - 0% Misc. exterior projects - 0% V ♦WA A L a O E W O r N O r N 0 .� U •� L ii LL O r c � � w E d c a rc�v 00000000000 CU O 0 Q U Q U) d d 0 �cOI.0000000000O o -� V CL U) . Q a� CD C m? L 0 3� i'` >1C CD CL > 0 • p �Ii2Q2��Q�OZO I • 2 -� LL Q r � w E m c a r00000000000r- .0 E O QU r 0 0 r o 0 0 0 0 0 0 0 0 0 0 o -� aN Q N _ E N L w 7 t co N-0 • p N O ca Q c0 7 7= N 0 0 0 -� -, Q cb O z al I • 2 -� LL Q CC io Vol r Ta is � O 3 O 0 c Q 0 E \e e C �0 Q. CL Q LO N r d' � � R 0 3 0 C7 � C7 c Q 0 E0 A c 0 a Q El r FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY April 55 2007 1. Islands of Peace Update The building department has recently issued building and plumbing permits to the owner of 151 Island Park Drive to complete the work started by Grant Rudolph. The other properties continue to be in a state of turmoil as the owners work at getting their properties back. I will continue to keep you updated as things move (or don't) forward. If we are successful in getting the Northstar legislation approved, as we had it drafted, a redevelopment project in this area may become feasible at some point. 2. Council / Commission Survey - MAY MEETING Dr. Bums has requested that the May meeting be moved to May 17th and preceded by a joint meeting with the City Council @ 6PM to discuss the Council / Commission Survey results. A dinner will be provided. 3. Home & Garden Show This years Home and Garden Show was a success, despite the snowy weather and slippery roads. While attendance was down slightly from last year, we still had over 700 attendees. The "Resource Room" that included the 4 City booths, free architectural and interior design consultations, and a retaining wall construction demonstration was very popular. The 9 seminars presented were all rated as excellent by the attendees. Work has already started on the 2008 Home & Garden Show slated to take place on February 23 "', 2008 at the Schwan Center. 4. Summer Intern Position The City's Community Development Department has hired an intern to complete the Housing Stock Conditions Assessment over the upcoming summer. Ms. Laurel Tracy, a Fridley native, is currently working on her Masters of Architecture at North Dakota State University and recently completed a similar study for the City of Fargo. Ms. Tracy has worked for the City's Parks and Recreation Department for the past two summers. We were excited to find someone with Laurel's expertise and close ties to Fridley. Laurel will start her summer internship at the end of May and complete the Housing Conditions Assessment before returning to Fargo in late August. 5. Gateway West The impossible finally happened.....that's right. ...the Gateway West 2"d Addition has finally been recorded at Anoka County. These lots are now available for Blueprint to purchase. Blueprint Homes continues to move forward with the building of homes and we should now see some activity on the southern block over the next few months. 6. Legislative Updates Minnesota Solutions and the MN Chapter of NAHRO (National Association of Housing & Redevelopment Organizations) do an excellent job of tracking legislation on our behalf. I have attached the most recent update from MN Solutions. 11 If there are any items you would like covered in upcoming issues of the Non - Agenda Update please send me an e-mail. bolinp @ci.fridley.mn.us iii Bolin, Paul From: Bonnie Balach [bbalach @comcast.net] Sent: Wednesday, March 28, 2007 9:05 AM To: David Black; Bob Streetar; Jode Thunstrom; Michael Posnick; Gary Stenson; Al Swintek; James Keinath; Jim Casserly; Gary Peltier; Branna Lindell; Bob Schreier; Rich Carlson; Wendy Underwood; Marc Nevinski; Steve Billings; Minnesota NAHRO; Mary Beth Davidson; Hickok, Scott; Kevin Walli; Doug Carlson; Tammy Omdal; Mike Taurinskas; Jim Holmes; Al Madsen; Ken Stabler; Brad Hoffman; Bruce Nordquist; Jamie Radel; Walt Fehst; Laura Harris; Dave Kelliher; Kathy Wolf; Carol Kelleher; john.stark @ci.roseville.mn.us; Sarah Erickson; Tim Cruikshank; Marcus Martin; Lorrie Louder; Bolin, Paul; Greg Johnson; Marylou Egan; Tom Cotruvo; John Grossman; Patricia Gustafson; Dan Donahue; Patrick Connoy; Paul Hyde; Clark Arneson; Jennifer Bergman; Kathy Hahne; Grant Femelius; Guy Peterson; Karl Gill; Louis Jambois; Barb Nelson; Scott Benson; jcarlson @braunintertec.com; Aaron Backman; Bruce Thielman; Ann Norris; Joseph Strauss; Kurt Ulrich; Mary Frances Skala; Ron Wood; Marcia Glick; Cathy Sorensen; Mary Molzahn; Nora Jost; Steve Bubul; Bill Barnhart; Jan Gustaafson; Meredith Udoibok; Gay Greiter; Margaret Robare ((MP)); Craig Waldron; Karen Skepper; Jeremy Carter; Ron Rankin; John Sullivan; Jim Kerrigan; Kevin Locke; Dianne Krogh; Bob Benke; Robert Kirchner; Jenn O'Rourke; Bret Heitkamp; Thomas Paschke; Debra Detrick; Cathy Bennett; Greg Hunt; John Karl; Nikki Newman; Dan Rogness; Ann Higgins; Patricia Nauman; Tom Harmening; Matt Fulton; John Kaul; Bryan Lloyd; Terry Speiker Subject: A quick poll. March 28, 2007 TO: Minnesota Solutions' Participants FR: Bonnie Balach RE: Legislative Update Things have been moving along at a frantic pace. The new deadlines are a little confusing -- both to the lobbyists and the committees. At this rate, though, all of the major bills will be ready for conference committee after Easter. As it stands now, the House Higher Education and Employment Policy and Finance Division has recommended $2M for the Redevelopment Account. There is also language that would 25% of it to be available in the Metropolitan Area. The Senate will probably be similar, but with a 50/50 split. What happens in conference committee will obviously be a result of whether the committee is weighted toward Greater Minnesota or the Metropolitan Area. It's possible that there could be no statutory change and the Metropolitan Area would be denied access completely. We just don't know. I don't think that some fraction of $2M is going to be worth it. We did get language on the table in the House that would appropriate $2M for the Contamination Cleanup Grant Program. Since that money is split 75/25, it might be a better deal for the Metropolitan Area, particularly with the amendment that is also on the table that would allow the use of program proceeds for geotechnical corrections when they are part of a redevelopment project area that has contamination issues as well. Please let me know ASAP if you have a preference. The receipt of first increment bill was heard in the House Tax Committee on Monday. We're hoping to get something that would allow flexibility at least for redevelopment and soils corrections districts. Our Transit Improvement Center bill is at the Revisor's and should get introduced this week. While we've missed the deadlines, it will be on the table for next year and we'll be able to get an early head- up as regards reactions.