Loading...
HRA 12/06/2007 - 29540�, CITY OF FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY COMMISSION DECEMBER 6, 2007 CALL TO ORDER: Chairperson Commers called the Housing and Redevelopment Authority to order at 7:30 p.m. ROLL CALL: Members Present: Larry Commers Pat Gabel William Holm John Meyer Steve Billings Others Present: Mike Jeziorski, City Accountant Scott Hickok, Community Development Director Paul Bolin, HRA Assistant Executive Director Jim Casserly, Development Consultant Richard Pribyl, Finance Director Greg Johnson APPROVAL OF AGENDA: MOTION by Commissioner Gabel to move the Housing Corridor Initiative Information Item to be discussed after approval of the minutes. Seconded by Commissioner Billings. UPON UNANIMOUS VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED ACTION ITEMS: 1. Approval of Expenditures MOTION by Commissioner Billings to approve the Expenditures as submitted. Seconded by Commissioner Gabel. UPON UNANIMOUS VOICE VOTE, ALL VOTING AYE, CHAIItPERSON COMMERS DECLARED THE MOTION CARRIED 2. Approval of October 25, 2007 Meeting Minutes Commissioner Gabel had several corrections to the minutes. MOTION by Commissioner Gabel to table the minutes until the January meeting. Seconded by Commissioner Holm. UPON UNANIMOUS VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COIViMERS DECLARED THE MOTION CARRIED � , 3. Approval of November 1, 2007 Meeting Minutes Commissioner Gabel had a few corrections to make to the minutes. MOTION by Commissioner Meyer to approve the minutes as amended. Seconded by Commissioner Gabel. UPON UNANIMOUS VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED 4. Housing Corridor Initiative — Final Report/Recommendations Gretchen Nicholls, Housing Coordinator Initiative, presented an overview and final report. The Corridor Housing Initiative was a process that was brought to the City of Fridley as a demonstration to think of development possibilities for some property that was recently purchased along University Avenue. A community engagement process was used to experience some of the core values and concerns that the community had regarding this location and what might be some viable development direction to take to this area. Ms. Nicholls said that the Corridor Housing Initiative is based on the basic principles of building the capacity of corrununities and think about transit corridors and what development options might involve. The exercise was to figure out how to energize collaboration, how to work with some of the resources and partners in the community to hy to build ownership, development and strategies, and to move forward with production towards the implementation of the goals the city is trying to achieve. Communities can engage most constructively and effectively if they are asked before a development occurs to see what the values and goals are and try to help guide development. Nothing happens without partnership, people need to work together to accomplish their goals. Implementation and results are critical for success. Ms. Nicholls said that the team was composed of herself, Barbara Raye, Katie Thering, Michael Byrd, Gina Ciganik, Scott Hickok and Paul Bolin. The goals that were defined at the outset of this process was to provide some ideas for the development of University Avenue and to help strengtl�en the participation of the community and get them involved in the goal setting process. These goals can be used as recommendations for the development and then identify the next steps in which direction the city would like to go. The committee took an advisory role in this process. It was a process that didn't really define one development direction because there was a range of development ideas that might fit in this area. They tried to integrate this process as a complimentary conversation of the updating of the Comprehensive Plan. There were three core themes: 1. Strengthen the identity of Fridley and using University Avenue as a gateway into the city. 2. Reiterate the building connections, how do you 'rntegrate and connect the areas of the city so that it looks together and lends value. 3. Create a viable district for University Avenue. Ms. Nicholls said that in this proactive strategy people brainstormed on what they thought were the challenges and/or opportunities for this area. Some of these included the state highway that limits the access, the fence, limitations of the types of developments that can be placed on the site and many residents desire a city center. We are sensitive on how these changes will impact businesses in the area and need to understand we need to be supportive and help them relocate if needed. Ms. Nicholls said there were four different sessions held. The first was a brainstorming and information session about current policies, design, and concerns. The second was the block exercise that created an opportunity to explore different development concepts. The third was a panel of.developers that involved sharing ideas on what could be developed in the area. Finally the last session was working with participants to frame the recommendations that are presented tonight. Ms. Nicholls said that the panel members from development firms were Alan Arthur, John Mehrker, Bob Long, and David Newman. They gave us a very rich dialog on how some of the resources may be obtained. The proximities of the single-family homes behind University Avenue is a factor and needs to be treated respectfully. The frontage road has some possibilities and could serve as a transition to the residential areas, the four-story height level could be worked with and as height is permitted, underground parking could be used. The durability of the building is a value, connectivity with other amenities such as Medtronic parkway would be an interesting add on to this area and give it more marketability, the many parks and public amenities people can connect with is a positive impact, and a city center still maintains a strong interest with a lot of people. Ms. Nicholls said that the community input was focusing on understanding that there is a significant financial gap and that the city would need to figure out ways to fill that gap. The city may need to wait until they can acquire more space and there is a deep appreciation of the complexities of this effort and the fact that the city is faced with a lot of challenges. The city may want to direct a developer to incorporate design elements, landscaping and how the area may be treated for best effect of scale, density and orientation of the buildings. The process supported a number of options from senior housing to office buildings. There was a lot of good will, support and respect towards the city to move forward with this area. Scott Hickok, Community Development Director, said that this was an enlightening process and the citizens increased their level of knowledge in how development happens. There was excellent discussion on how development happens, realizing the condition of the property and if we can't do it right now there is a better understanding on how gaps work. We deal with these types of problems on a regulas basis in the development world. If we brought in citizens at the very early stages of this development they better understand how this works and have a role in what outcomes there are in what kind of development we will have. We may have to wait till we have more resources or additional land to make this work. People came out with a higher level of sophistication on how development works and were appreciative to be involved in the early stages. Chairperson Commers said he was not able to attend all the workshops but can see how things can change. People realize different issues that come with the development of property. The meetings were managed professionally and the HRA will evaluate the information and see if anything comes of the informational study. Ms. Nicholls said it was great to have the ability to do a development and put it on cable television for residents to view. This is an educational process and people will benefit by understanding the issues of what is possible and likely to happen in Fridley. Commissioner Gabel asked if the attendance at the workshops was what was expected for this type of study. Ms. Nicholls said that they have never been in a suburb before. If they were to do another suburb they may promote more participation because this a genuine opportunity for residents to be involved in this process. Commissioner Gabel said she really liked the exercise with the building blocks. It was enlightening to see how to make it work and many realized how much work is involved in this development process. Ms. Nicholls said that it is fun for developers to see what interests the city and what they want to see happen. Commissioner Holm said he was impressed with how the project moved along. It is a very complicated and extensive effort to involve the citizens. Mr. Hickok said that from a staff perspective it was an excellent exercise and it ties in with the Comprehensive Plan. Planning Commissioner David Kondrick put this in a great perspective by comparing this experience with selling a house. When people sell a house they may hire a"sta.ger" to come in and arrange the furniture, get rid of the clutter to maximize space and be appealing to potential buyers. He said it would be nice to have a"stager" come to Fridley and look at our projects to see their perspective. This is what Gretchen and her group did for Fridley. This group is both respected and professional. This gives us fresh prospective and a team of professionals. He would highly recommend this process and group to other communities. He would like to consider this group for advice and guidance on future projects. 5. Approval of Final 2008 Budget Mike Jeziorski, City Accountant, said the budget is the same as the preliminary budget so there were no changes from the last meeting. HRA reviewed the proposed budget on November l st. Questions on fund balances and funding commitments were raised. Answers to those questions were provided in packet. Finance Staff and Legal Counsel are present to answer any additional questions. Chairperson Commers asked if the budget format was different that the past. Richard Pribyl, Finance Director, said yes, they did change the format. Chairperson Commers asked for examples of t� increments to understand the new format and what each line item is suppose to mean. Mr. Jeziorski gave a few examples and explained some of the line items. Mr. Pribyl said that maybe specific questions could be addressed at a separate meeting and to go over how to understand the new format. Commissioner Gabel agreed that a workshop meeting would be helpful to go over this in more detail because it can be confusing. MOTION by Commissioner Gabel to approve the Final 2008 Budget as presented. Seconded by Commissioner Holm. UPON UNANIMOUS VOICE VOTE, ALL VOTING AYE, CHAII2PERSON COMMERS DECLARED THE MOTION CARRLED 6. Authorization to Present Purchase Offer — Sinclair 5ite, GWNE Paul Bolin, HRA Assistant Executive Director, said that Lake State Realty Services completed an appraisal report for the former Sinclair Station in November and Fair Market Value is $305,000 as the building itself still has some value. Review of City and Fire Marshall records do not reveal any major contamination on this site. MPCA and MNDOC offer financial assistance to clean up petroleum contamination. Wilson Development is reviewing appraisal, existing lease, and meeting with owner on December 7`" to determine relocation costs, but expects them to be minimal. Mr. Bolin said that the building is currently used sporadically for auto repair and gasoline sales. Staff recommends that the Authority authorize staff to present an of%r to purchase, based on the appraised value, the former Sinclair property. Staff further recommends that Chairman Commers be authorized to execute any purchase agreements necessary prior to the HRA's next meeting, provided relocation benefits are not excessive. Chairperson Commers asked if there was a willing seller at this time. Mr. Bolin answered yes. A year ago there was no interest in selling but now the seller has contacted us. Chairperson Commers asked about the Tae Kwon Do building. Mr. Bolin said that they had were interested in selling until we made an offer. Dan Wilson did have a conversation with Mr. Kim, the owner, and will meet with him next week so we may get a response. Chairperson Commers asked if the city could condernn a parcel if HRA had a development plan needing that area. Jim Casserly, Development Consultant, said that HRA has the ability to acquire if there was serious blight, so serious that it would require demolition or mediation. Chairperson Commers asked Mr. Casserly to check and see if HRA would have the authority to acquire or condemn the parcel. Mr. Casserly said that Economic Development is not considered public purpose for this activity. If the city was redesigning the road for public purpose or infrastructure the city could probably acquire the properiy, but because this is for basic redevelopment he did not think the city could acquire the property. He would double check and get back to the HRA. Commissioner Holm said that he understood from the presentation that the owner would listen to the offer but there is a lease on the property. He wondered if there would be any difficulties because of the leaseholders rights. Mr. Bolin said that is why Dan Wilson was meeting with the owner but he did not think anything would hold up this process. Commissioner Gabel asked if there were a lot of ongoing issues with this property and stipulations with SUP. She said it did not sound like things were going too well on this property. Mr. Hickok said that is correct that there is a Special Use Pernut on this property with specific stipulations that need to be maintained. It is in the cities best interest to keep all properties with Special Use Pernuts adhere to the stipulations. There have been problems with this site and staff continues to monitor the site. Commissioner Billings said that the appraisal was received at $305,000 and asl�ed if we were under any obligation to make an offer for the entire amount. The property owner paid $230,000 for the property three years ago. This person knows this is not the best site for a gas station or any other use. The property is not worth $305,000. They are approaching us to see if we want to buy the property. Maybe the property is only worth $200,000. The property is not worth more to us because we are not going to use the property for a gas station. Maybe offer $250,000 -$275,000 to see if they would accept the offer. We do not have to have this piece of property. Why should we reward them for being a lousy operator over the last three years by offering prime amount? We have to make them aware of the appraisal because it is public record, but the appraisal is so high because it is currently a gas station and that is not going to be our use. Mr. Bolin said that the city's practice has always been to offer fair market value. The city of Coon Rapids had problems 5/6 years ago buying properties and paid the asking price. A few years later the properly owners filed a claim because they didn't pay the fair market value. Mr. Casserly said that the question is complicated. If we are not going to be involved in any kind of condemnation there are some different things we can do. We do need to be careful doing appraisals and then offering less. He will have to get back to HRA on this question. Commissioner Billings said that if we desperately needed this site then pay fair market value, but in 6-9 months the fair market value will probably go down so maybe we wait. Mr. Casserly said that there are really two issues. One is if we think the appraisal is not adequate because of the market conditions, the second issue is what kind of exposure do we have if we offer something that is substantially lower than the appraisal we had made for the specific site. Appraisals are based on comparable sales and value today. Commissioner Billings said that appraisals are based on historical data and the sales in the past have all been very high. Commissioner Gabel said it doesn't hurt to have a discussion with the property owner because we don't need to jump into this property. She has no problem waiting. Chairperson Commers said that at this point there is a willing seller. The properties may go down but who wants to speculate that, what if it goes up. It is pure guesswork. Commissioner Billings asked who is leasing the building, relatives of the property owners? Mr. Hickok said that is correct. Commissioner Billings said that even the family is having trouble making it in the gasoline sales business. Chairperson Commers said that the issue is with the appraisal and how he arrives at this value. Commissioner Billings said it is based on historical data, what similar properties sold for. Chairperson Commers asked what comparables were used and what dates were used on the appraisal. Mr. Bolin said that nine different parcels were used from October of 2005 to January 2007. Commissioner Billings said that only one property used was less than a year old. Chairperson Commers asked if a time adjushnent was used. Mr. Hickok answered yes. Commissioner Holm said that maybe we should hold off or authorize purchase up to a certain amount. Commissioner Gabel said that there is a saying out there, what something is worth is whatever someone is willing to pay. She suggested authorizing the conversation but maybe put a cap on the amount or do some more research and bring this back to the next meeting. Commissioner Billings said that $30,000 savings is a lot of money but he doesn't want to put the HRA at risk for a larger amount. He asked what the problem would be for offering a lesser amount than the appraisal. He would not want the HRA to spend a lot of legal fees but would like an answer as to what would be the problem if we offered less than the appraisal. If we want to offer less than fair market value, should we go ahead and do something or wait and see what happens. Either way we need to let the owner know of the appraisal amount. Chairperson Commers thinks there is a problem once we get an appraised value. Once we get a report you get pretty much locked into the amount. Mr. Hickok said that adjustment for the time is based on .33% per month. So they did adjust the time frame accordingly. Dan Wilson brings his expertise to this and thinks the value is worth it and incidentals are factored into the price. Mr. Bolin said that Dan Wilson is meeting with the owner tomorrow. He is thinking relocation costs would be minimal and worked that into the value. Mr. Casserly said that if this number is close to an all inclusive number, one of our obligations is to inform the seller what relocation act would provide and the owner can waive the benefits. We need to take into account the other benefits that could be over and above the cost. The land is $13-$14 per square foot and everything else will be torn down. He is not sure the value to us is the same as a potential gas owner would be. INFORMATIONAL ITEMS: 1. Northstar Update Paul Bolin, HRA Assistant Executive Director, said the MOU was approved by HRA last month and this document spells out responsibilities and future actions. The Anoka County Rail Road Authority approved the MOU on November 13th. The tunnel agreement with BNSF has been executed. Mr. Bolin said there is a HRA meeting with NCDA staff next week to discuss the next steps in greater detail. The FFFGA is to be signed December 11`". This allows for more formalized discussions with ACRRA, NCDA, Met Council and MN DOT. We are currently working on last years legislation. Mr. Bolin said the NCDA Board met late this afternoon and approved 2008 Budgets. A number of items in the budget were specific to Fridley's Rail Site. $125,000 in Professional Services, $155,000 in Project Management (tunnel), $1.6M in tunnel construction costs for a total of $1,880,000. NCDA is committed to getting the Fridley Station built with rest of system. 2. Monthly Housing Report Paul Bolin, HRA Assistant Executive Director, reported that there was one RLF loan and two other loans in November for a total of 171oans year to date. Operation Insulation visits are just one year to date and Remodeling Advisor Visits had one in November for a total of 26 year to date. There is a concern with the high amount of foreclosures happening and how that may affect our loan program. The good thing is that we have a$35,000 cap on the loans. Staff will keep an eye on the loans and keep HRA informed. NON AGENDA ITEMS: Paul Bolin, HRA Assistant Executive Director, said that the salvage yard items are making positive movement. Staff is seeing reinvestment relating to Special Use Permits on two of the sites. Things are looking good and perfornung well. Staff is comfortable with the appearance and reinvestment and the owners are happy as well. Staff will continue to update as things progress. Chairperson Commers said that Gateway West continues to be moving along. Mr. Bolin said yes. The housing market did slow down but the builder is still optirnistic. Commissioner Gabel asked if we needed to make any changes to the time tables. Mr. Bolin said that if they don't sell any homes in the next few months maybe. Mr. Bolin said that the next meeting is scheduled for January 3, 2008. ADJOURNMENT: MOTION by Commissioner Gabel to adjourn. Seconded by Coxnmissioner Meyer. UPON UNANIMOUS VOICE VOTE, ALL VOTING AYE, CHAIRPER50N COMMERS DECLARED THE MOTION CARRIED AND THE MEETING ADJOURNED AT 9:35 P.M. Respectfully Submitted by, �,�m Krista Monsrud Recording Secretary CITY OF FRIDLEY SIGN-IN SHEET HOUSING & REDEVELOPMENT AUTHORITY MEETING ' C�n�.l9e� D � � Name and Address Agenda Item of Interest lv��1�S �' `� C aa'� S�' C..���.r�� � /'� � 1 S M� S�'� `( v`l I�-�,��-P�1_..: i�' � ��-33 (.i�tJ.� ,�, � S°� - ��� � �