HRA 09/04/2008 - 6356September 4, 2008
HRA Meeting
Regular Meeting Agenda
7:00 u.m.
City Hall, Council Chambers
Call to order
Roll call.
Action Items
1. Approval of expenditures
2. Approval of August 7, 2008 Meeting Minutes
3. Approval of 2008 Tax Levy for Taxes Payable in 2009
Informational Items
1. Northstar Rail Station Update
Adjournment
H.: — Paul's DocumentAHRAMA Agenda Items\2008\.September 4, 2008\.Sept 4 -2008 Agenda Outline.docH:l— Paul's
DOCUmentsVRAV4PA Agenda Items\20084September 4, 2008\Sept 4 -2008 Agenda Outline.doc
a
CITY OF FRIDLEY
HOUSING AND REDEVELOPMENT AUTHORITY COMMISSION
AUGUST 7, 2008
CALL TO ORDER:
Chairperson Commers called the Housing and Redevelopment Authority to order at 7:05 p.m.
ROLL CALL:
MEMBERS PRESENT: William Holm
Pat Gabel
Larry Commers
Steve Billings
John Meyer
OTHERS PRESENT: Mike Jeziorski, Accountant
Jim Casserly, Development Consultant
Paul Bolin, HRA Assistant Executive Director
Scott Hickok, Community Development Director
ACTION ITEMS:
1. Approval of Expenditures
Commissioner Meyer asked what lawns were being mowed.
Paul Bolin, HRA Assistant Executive Director, said it was HRA properties, Gateway West, etc.
MOTION by Commissioner Gabel to approve the expenditures as presented. Seconded by
Commissioner Meyer.
UPON UNANIMOUS VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS
DECLARED THE MOTION CARRIED.
2. Approval of May 1, 2008 Meeting Minutes
MOTION by Commissioner Holm to approve the minutes as presented. Seconded by
Commissioner Gabel.
UPON UNANIMOUS VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS
DECLARED THE MOTION CARRIED.
3. Annual Election of Chair and Vice Chair for One -Year Terms
Paul Bolin, HRA Assistant Executive Director, stated that HRA By -laws require the
Commissioners to elect a Chair & Vice -Chair to one -year terms. Staff recommends that the
Authority elect a Chair & Vice - Chair.
MOTION by Commissioner Holm to nominate Commissioner Gabel as Vice Chair and
Commissioner Comm ers as Chair for a one year term. Seconded by Commissioner Meyer.
UPON UNANIMOUS VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS
DECLARED THE MOTION CARRIED.
4. Approval of Resolution Declaring Properties Blighted
MOTION by Commissioner Gabel to change home to building on page one. Seconded by
Commissioner Holm.
UPON UNANIMOUS VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS
DECLARED THE MOTION CARRIED.
Paul Bolin, HRA Executive Director, stated that the HRA currently owns 4 properties along
University Avenue in the area referred to as Gateway Northeast that are blighted. The buildings
are blighted and present a poor image along University Avenue, problems with break -ins,
vandalism, copper theft, cost of maintenance, and illegal dumping. The City's Chief Building
Official conducted inspections and blight analysis for these buildings and determined that
properties exceed the statutory requirements for a substandard building. The buildings are in
need of repairs / code upgrades equal to or greater than 15% of an identical new structure's cost
are considered substandard / blighted.
Mr. Bolin stated that the costs were determined using R.S. Means Cost Data — 2008 Edition. All
buildings far exceed the 15% rule. All 4 buildings need fire sprinklers, new roofs, HVAC,
plumbing upgrades, and would require substantial improvements to meet the Energy &
Accessibility Codes (the AC costs are not included below).
♦ 5865 University Ave. (Oriental Hse) — 32%
♦ 5945 University Ave. (New VOL) - 20%
♦ 6005 University Ave. (Carquest) -19%
♦ 6041 University Ave. (Old VOL) -19%
Mr. Bolin said that the Resolution in tonight's packet would allow for the demolition of the
properties, while allowing the properties to be included in a future TIF Redevelopment project.
HRA would have 3 years from the date of demolition to create a TIF District. If project is not
ready at that time, can create district and defer collection of increment for 4 more years. Staff is
confident that a project will move forward within this timeframe. Staff recommends adopting
the resolution and moving forward with soliciting bids for October demolition. This resolution
also requires City Council approval.
Commissioner Meyer asked who would challenge our findings.
Mr. Bolin said that as far as a regulatory type of challenge, the State Auditor does reviews of
TIF Districts. A challenge could also come if a property went through condemnation and the
owner didn't agree to do so.
Commissioner Meyer asked if the former owners had any role in these findings or are they out
of the picture.
Mr. Bolin said that they can show up at meetings but the information is very well documented
with photos -and notes.
Commissioner Meyer said that he is familiar with the procedure and there is a good/better/best
tier and-he didn't want to be caught short by using the high end. He asked where we were on
that decision.
Mr. Bolin said there was a range and they tried to stay in the middle of the range. Once the
percent of blight is determined all numbers from RS remains and they try to compare apples to
apples.
Commissioner Meyer asked what the projected cost was for the demo.
Mr. Bolin said he did not have that information but the last demo was on Gateway West. He did
not have the actual cost but thought it was under $100,000.
Scott Hickok, Community Development Director, said that the last demo was $52,000.
Commissioner Meyer said that the actual cost should not be a factor in tonight's discussion.
Mr. Bolin said that is correct, tonight the property needs to. be declared blighted. He would get
the estimates of demolition approved by the HRA prior to starting demolition.
Commissioner Holm said that he understands what is involved and if they deferred the cost he
asked what the additional costs would be.
Mr. Bolin said that he did not have the exact dollar amounts available. There would be mowing
costs, electric bills if the building stayed as it is, plus there is a liability issue of the unsafe
building. Someone is going to get hurt sooner or later. It would be ideal if the buildings could
stand but with the condition of the buildings, it is important to get them demolished. There are
liability issues even though the buildings are locked up.
Commissioner Holm said that once the buildings are demolished the clock will start ticking and
we don't have a district together. Personally he would like to defer the action until we know
where we are at with the other properties.
Chairperson Commers said that tonight they just need to determine the property blighted, but
once the building is demolished the clock starts ticking.
Mr. Hickok said that the building is vacant, costs can go up fast and we need to secure the
building. Several times there could have been serious problems with older buildings. This is a
hazard, the building needs to be boarded and secured.
Chairperson Commers asked if it would be worth it to invest a few dollars to create a park -like
scene.
Mr. Hickok said that a park has been mentioned but sometimes then residents don't want the
park to go away.
Commissioner Billings asked about the water service to the Tae- Kwan-Do building.
A
Mr. Bolin said Mr. Kim has been given information notice about the buildings coming down.
There are no schematic drawings, nothing drawn up in plans showing how things connect.
People in the water department seem to know how the line goes. If we don't heat the building, it
freezes the water going into the Tae - Kwan -Do building. The right thing is to get estimates for
demolition this fall.
Commissioner Billings said he would like to hear an update on the properties and -then -make
that decision.
MOTION by Commissioner Gabel to approve the Resolution Declaring Properties Blighted.
Seconded by Commissioner Billings.
UPON UNANIMOUS VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS
DECLARED THE MOTION CARRIED.
MOTION by Commissioner Gabel to have staff proceed with the demolition bids. Seconded by
Commissioner Holm.
UPON UNANIMOUS VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS
DECLARED THE MOTION CARRIED.
Chairperson Commers said that they will know more in September. The consensus is to wait
until September. He asked what kind of lead time staff needed.
Mr. Bolin answered 2 -3 weeks. The worst case scenario would be to start demolition later, like
November/December.
INFORMATIONAL ITEMS:
1. Northstar Rail Station Update
Paul Bolin, HRA Executive Assistant Director, said that the Funding for Rail Station includes a
1/4% Sales Tax became effective July 1. Grant applications will be accepted in September and
funding will be awarded in late October. NCDA is starting the final design work and plan to
meet with City Building Official. They may ask HRA to fund a portion of the design work (with
intent to be reimbursed). There are concerns from Federal Transit Administration/ MC as they
do not want to jeopardize FFFGA, which may delay our station opening (not construction).
They are working with Senator Coleman's office to avoid problems with FFFGA.
NONAGENDA UPDATE:
Gateway NE Update
Tae Kwan Do building, Mr. Kim has indicated that he would like a new appraisal for his
property, as current appraisal is now over 18 months old. Staff recommends the HRA update the
appraisal. The Alano Society has a number of draft Purchase Agreements have been exchanged
over the past month. It is likely that the Society would need to lease back the building as they
find a new site. We are working out some fine details and will likely bring PA forward at your
am
September mtg. The Javelin Group is'still working on an environmental assessment on the.
Sinclair building.
MOTION by Commissioner Gabel to update the appraisal for the Tae Kwan Do Building.
Seconded by Commissioner Holm.
UPON UNANIMOUS VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS
DECLARED THE MOTION CARRIED.
Gateway West Update
Paul Bolin, HRA Assistant Executive Director, said that Blueprint continues to try to attract
homebuyers in the Gateway West area. The final lift of Asphalt to be installed on 57th Place and
3'a Street up to 60th Avenue was delayed from 2006 as DPW wanted more homes constructed
prior to final lift. Prices for work are now $8,000 less than they were to do this same work in
2006 and the total for this remaining work is $42,275.
Sikh Society
Mr. Bolin said that they were looking for an easement from Petco but they declined. The front
of the building will now need to be redesigned, which could take more time. It is more than
likely this will end up being a spring project.
Mr. Bolin said there will be a foreclosure workshop offered in September. Since the flyer has
went out, staff have received 16 calls about the workshop.
Mr. Bolin said that there were 7 loans out in July /July which makes a total of 9 for the year,
totaling $94,000. Another five loans are in process and one is scheduled to close next week. A
CE Mailer is going out to residents to generate some more action on this program. Remodel
visits were five for the months of June and July combined.
ADJOURNMENT:
MOTION by Commissioner Holm to adjourn. Seconded by Commissioner Gabel.
UPON UNANIMOUS VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS
DECLARED THE MOTION CARRIED AND THE MEETING ADJOURNED AT 8:20
P.M.
Respectfully Submitted,
Krista Monsrud
Recording Secretary
DATE: August 26, 2008
TO: William W. Bums, City Manager
FROM: Paul Bolin, Assistant Director of HRA
Mike Jeziorski, HRA Accountant
SUBJECT: Consider HRA Tax Levy for Taxes Payable in 2009
Since 1996, the HRA has utilized a tax levy to help support its housing rehabilitation
programs. For a number of years the levy was equal to .0144% of the taxable market
value of all real estate and personal property. Legislation passed in May of 2008
increased the maximum levy amount for Housing & Redevelopment Authorities to
.0185 %. The new 2009 tax levy rate will allow the Authority to collect approximately
$499,757. In terms of the impact on taxpayers, the levy would cost $37 per year for a
home valued at $200,000 and $185.00 per year for a commercial property valued at
$1,000,000. The additional revenues raised by the new rate can be directed towards
ongoing and future redevelopment priorities.
This tax levy was originally implemented to help fund the HRA's revolving loan
program. In 1997, the City made a loan of $1.5 million to the HRA to capitalize the loan
fund. In turn, the tax levy was used to make the debt service payments. The principal
balance of the loan is now $277,560.
State Statutes require the consent of the City Council, prior to the tax levy becoming
effective. The City Council will act on this item on September 15th. As a final note, the
HRA tax levy will be certified to the County Auditor on September 16, 2008.
Recommendation
Staff recommends that the Authority approve the attached resolution at their regular
meeting on September 4, 2008.
Attachment
H: \—Paul's Documents\HRA\HRA Agenda Items\2008\September 4, 2008\2009HRA Memo (HRA Tax Levy).doc
INFORMATIONAL ITEM
HRA- ME -E-TING OF SEPTEMBER 4, 2008
CrrY of
FRUXEY
Date: August 29, 2008
To: William Bums, City Manager
From: Paul Bolin, Asst. Executive HRA Director
Scott Hickok, Community Development Director
Subiect: Northstar Rail Project Update
Staff remains very optimistic that.the remaining fundinp necessary for our rail station will
come from the 1/4% sales tax as soon as November 1s. The CTIB Board recently
finalized the criteria for funding this first round of grants and the Anoka County Regional
Rail Authority is applying for $10.6M to complete our rail station.
Attached are a number of informational items including:
1) Letter from Commissioner Kordiak to Senator Coleman
2) The "Counties Transit Improvement Board" (CTI13) — Interim Transit Investment
Framework
3) Draft of upcoming City Newsletter article on status of Northstar
I will provide a more detailed verbal update at the meeting next week. Dr. Burns, Mayor
Lund, Councilmember Barnette and I are meeting with Anoka County on Tuesday
morning to further discuss the CTIB grant application, the local match requirement, and
develop a timeline for our project.
Next Thursday afternoon Councilmember Barnette and I will be attending the NCDA
Board meeting.
I'm sure you are all getting sick of railroad puns, but it seems that we are now on the
fast track.
JIM A. KokVUK
County Commissioner
M ado N4
COUNTY OF ANoKA'
OFFICE OF COUNTY BOARD OF CONZUSSIONERS
Dovr -. T CIN m
2.100 3RD AvFNuE STE 700 • ANDY-A, MN 55303 -5024
(763)323 -5700
August 18, 2008
The Honorable Norm Coleman
320 Had Senate Office Building
Washington, D.C. 20510
Dear Senator Coleman:
This is a letter seeking your assistance to aid Anoka County in its effort to add the Fridley station to the
Northatar Commuter Rail project. This letter follows up on a letter sent to you by the Fridley mayor and city
council seeking your support, which I have enclosed.
Throughout my 20 years as Anoka County commissioner I have never asked the Congressional Delegation
for much; however, the Fridley rail stop is of great Importance to me. You and your staff have been very
supportive of this project; without your help, we would not be opening Northstar in 2009. r thank you for
your help, and ask that you continue supporting us as we try to get the Fridley Station constructed and
opened at the same time, in November 2009.
We have heard that the Federal Transit Administration (PTA) Chicago has calf the Minnesota Department
of Transportation and indicated that the FfA does not have a problem with us proceeding to construct and
open the Fridley Station. The Metropolitan Council, however, is reluctant to proceed with the station until
we have the FTA's consent in writing. Would you consider contacting the FTA In an effort to ensure that
they will allow as to complete the Fridley Station in a timeline consistent with the other stops previously
planned in the corridor line?
Once again, I thank you for your support and assistance. I and the Anoka County Regional Rail Authority
staff wilt be eager to provide any information for you to address this concern.
Si erely,
Kordiak
Anoka County Commissioner
JK:de
Enclosure
By Fax (202 - 2241. 152)
C. Cyrell R. Mcl emore, 'Federal Transit Administmtion
Lona Schreiber, Intergovernmental Coordinator
FAX- 763- 323 -5662 Artinnative Action / Sunni ou wa4unity F,molover TDDrrrY- 763- 323 -3289
2/2'd L82TTLS£9L:0l 02"BBL£91L xdia 10)1 S34df:wojd LS:2T 8002 -92 -OM
Approved: August 20, 2008
Counties Transit Improvement Board
Interim Transit Investment
Framework
2008
Approved: August 20, 2008
Approved: August 20, 2008
Approved: August 20, 2008
Interim Transit Investment Framework
(2008)
INTR -ODUCTIO -N-
This Interim Transit Investment Framework (ITIF) will guide funding decisions of the
Counties Transit Improvement Board (CTIB) for the 2008 grant solicitation. The funding
available for grants will be from sales tax proceeds for the remainder of 2008 and a portion
of 2009. Longer -term guidelines will be developed by the CTIB after this initial grant
process is completed.
This ITIF and the limited, streamlined 2008 grant process prescribed herein are
necessitated by the various actions of the 2008 legislature. These legislative actions
include:
• A one -time only requirement to provide the Metropolitan Council $30.783 million for
transit operating assistance for State Fiscal Year 2009.
• A prohibition on the use of county property tax dollars for rail operating assistance
beginning in January, 2009.
• A limitation of 10% of capital costs for both counties and the state on "New Starts"
projects.
• No legislative action on requests for construction funding on portions of two
transitway projects (Northstar Commuter Rail and Cedar BRT).
As a result of these actions, there are immediate and urgent funding needs that the CTIB
must address through grants awarded in 2008.
During this interim term, investment in transitways will be in accordance with the following
principles:
A. CTIB was created to accelerate the development of new and enhanced
transitways to serve the Metropolitan Transportation Area (MTA), which
comprises Anoka, Dakota, Hennepin, Ramsey and Washington Counties.
Therefore, the overriding priority for CTIB action and investment will be to
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Approved: August 20, 2008
construct new transitways, and support their operations upon completion, in as
expeditious and cost- effective a manner as possible.
B. In recognition of the initial limited resources, as well as immediate needs and
external deadlines, the ITIF authorizes grants for relatively limited and prescribed
purposes. This will allow projects to progress and will further provide an
opportunity for the CTIB to develop financial plans, a Long -Term Transit
Investment Framework and a more comprehensive approach to the annual
grants process.
C. The new transportation funding legislation requires CTIB to maximize the use
and availability of federal funding. In order to maximize federal funding, federal
funding regulations and guidelines require a local funding commitment to
federally funded projects. Such commitment is required prior to the award of
grant funds. As a result, this ITIF will provide the necessary commitment for the
Central Corridor, the CTIB's top priority for transitway implementation at this time.
D. Minnesota Statutes prohibit use of county regional railroad authorities' property
tax levies for use in meeting funding obligations for operating rail projects, as of
January 1, 2009. Thus, the CTIB must provide the necessary funding
commitment for 50% of rail operating subsidies in order to allow the county
regional railroad authorities to make adjustments to property tax levies in a timely
manner. This ITIF will address the necessary commitments within which grants
will be evaluated and awarded. The funding amount of annual grants for
operations will be negotiated with Metro Transit, and operating cost grants will be
awarded pursuant to the CTIB grants process.
E. CTIB's dedicated revenues will be used to assist in building and operating new
transitways once the feasibility of each transitway has been established and a
financial plan to build and operate the transitway has been prepared. This
priority recognizes that preliminary plans and feasibility studies will require
financial support from other public and private organizations, until such time as
feasibility and project design has been sufficiently established to qualify for CTIB
financial support.
FA
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Approved: August 20, 2008
F. CTIB transitway investments will be consistent with the most recent
Transportation Policy Plan adopted by the Metropolitan Council, though not
necessarily identical with regard to capital and operating details, timing of
investment, and other elements. CTIB will consider a variety of factors in
assessing investment opportunities and grant eligibility, including geographic
equity over time, to ensure that new transit infrastructure investments provide
benefits to residents and businesses throughout the MTA.
This ITIF includes the following sections:
Section 1.
Purpose
Section 2.
Definition of Transitways
Section 3.
Funding Available
Section 4.
Eligibility Criteria
Section 5.
CTIB Commitments
Section 6.
Timeline
Section 1. PURPOSE
The purpose of this ITIF is threefold:
A. To meet statutory requirements:
1. Minn. Statute §297A.99, subd. 5(a) requires CTIB to establish a process
and identify the amount of available funding for grants.
2. Minn. Statute §297A.99, subd. 5(b) requires CTIB to establish a timeline,
procedures and objective criteria for grants.
B. To establish the framework within which the CTIB will invest in transitway
development in 2008 and in 2009.
C. To guide Grant Evaluation and Ranking System (GEARS) committee in its
evaluation and ranking of grant applications received in the 2008 solicitation.
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Approved: August 20, 2008
Section 2. DEFINITION OF TRANSITWAYS
OPTION 1.
For purposes of eligibility for 2008 grants, transitways shall be defined as transit operating
in a dedicated right-of-way to assure fast, reliable, attractive and efficient service to
residents and businesses in the MTA. Transitways shall include light rail transit, commuter
rail, bus rapid transit (BRT) and passenger rail within the MTA. In 2008, transitway corridors
eligible for funding pursuant to this ITIF must have an immediate funding need resulting
from statutory requirements or federal funding requirements or to provide construction
funding to complete elements of transitways being constructed in 2008 -2009, as shown on
the attached map (Attachment A)..
Section 3. FUNDING AVAILABLE FOR 2008 GRANTS
Based on preliminary estimates from the Department of Revenue for a period from
September 2008 through June 2009, the funding available for grants for the 2008
solicitation will be approximately $70,000,000. Note that this amount includes the
statutorily required grant of $30.8 million to the Metropolitan Council. Funding available for
discretionary grants will be approximately $39.2 million.
Section 4. GRANT ELIGIBILITY CRITERIA FOR 2008
The following grant eligibility criteria will be used by GEARS to evaluate grant applications
and by CTIB to select and award grants. The CTIB will award grants only to the state and
political subdivisions, as prescribed by Minn. Stat. section 297A.992, subdivision 5(b).
The 2008 eligibility criteria include:
1. Grant funding shall be available for the following types of projects:
a. Capital costs, including: Preliminary engineering, final design, right -of -way
acquisition and construction of transitways
b. Operating subsidies for transitways
2. Grant awards shall maximize the availability and use of federal funds.
3. No grant award made to the Metropolitan Council may supplant operating or
capital funding provided to the Metropolitan Council by the State.
4. The following transitways will be eligible for a capital grant:
4
Approved: August 20, 2008
a. Northstar Commuter Rail
b. Cedar Avenue Bus Rapid Transit
c. Central Corridor Light Rail Transit
5. All grants for capital dollars require a local match of 10% of the total cost of the
project for which grant funding is requested. The match must be a capital
contribution. If the applicant is a county, county regional railroad authority or city,
the match shall not include funding provided by the Metropolitan Council, the State
of Minnesota or the federal government. If the applicant is the Metropolitan
Council, the match shall not include funding provided by the federal government or
local government.
6. No grant award made to the Metropolitan Council may supplant the 50% state
share of the non - federal operating subsidy for light rail and commuter rail
operations.
7. No grant award shall be made for operating costs of a transitway (except for the
Hiawatha LRT Project, the Northstar Commuter Rail Project, Cedar Avenue BRT
Project, and the 1 -35W BRT Project from downtown Minneapolis south) unless the
Board has previously awarded a grant for the capital costs of the transitway
project.
8. The following transitways will be eligible for a grant for operations:
a. 1 -35W South Bus Rapid Transit
b. Cedar Avenue Bus Rapid Transit
c. Hiawatha Light Rail Transit
d. Northstar Commuter Rail
A grant award for operating costs may be up to and no more than 50% of the
operating subsidy. Only new and expanded BRT transitway operations will be
eligible for a 50% operating grant.
9. Grant awards shall be consistent with the Metropolitan Council's 2030
Transportation Policy Plan, as adopted in 2004.
10. No grants will be awarded for studies. Projects undertaking preliminary
engineering or final design will be eligible for a grant.
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Approved: August 20, 2008
11. In accordance with Joint Powers Agreement Article VII.2.H., each county shall be
awarded annual grants of at least 1 % of the total sales tax proceeds for the
calendar years of 2009, 2010, and 2011. (Note: This type of grant shall be
awarded only if a County does not receive a grant for transitway capital or
operating costs in the amount of at least 1 % of the total sales tax proceeds.)
Grants awarded pursuant to this paragraph will receive priority funding, will be
reviewed by GEARS, and must be consistent with the 2030 Transportation Policy
Plan. Notwithstanding the above listed eligibility criteria, a grant application
submitted by a county pursuant to this paragraph must be for a transit purpose
specified in Minnesota Statutes Section 297A.992, subd. 6., and may include
express bus service within the definition of transitways.
12.The CTIB shall grant $30.783 million to the Metropolitan Council for transit
operating assistance in State Fiscal Year 2009.
Section 5. CTIB FUNDING COMMITMENTS
A. Capital Funding
A core element of this ITIF is the CTIB funding commitment that is necessary to fulfill
the statutory directive to maximize the availability and use of federal funds in
projects funded by CTIB grants. Transitway projects are eligible for up to 50%
federal funding under the New Starts program administered by the Federal Transit
Administration (FTA). New Starts funding is awarded by the FTA pursuant to a
national competitive grant process. The FTA rates projects in part based on a
project's capital funding plan which includes the commitment of local funding
sources. The higher the local commitment, the better the FTA rating for the project.
The FTA defines a committed source of funding as programmed capital funds that
have all the necessary approvals to be used to fund the project. In other words, no
additional legislative action or referendum is needed.
The CTIB's top priority for project implementation and funding in the MTA is the
Central Corridor LRT Project. In order for the Central Corridor LRT Project to to
1.1
Approved: August 20, 2008
receive the highest rating of the financial elements of its application for final design
(the next phase of project development), the project must demonstrate a local
commitment of 50% of the total capital cost. Of that amount, the State and the
County Regional Railroad Authorities of Hennepin and Ramsey are each providing a
commitment of 10% for a total of 20 %. (Note that Minn. Statute Section 473.4051
(as amended in 2008) provides that State money may not be used to pay more than
10% of the total capital cost of a light rail transit project.) The CTIB will commit the
remaining 30% of the total project capital costs. By adoption of this ITIF, the CTIB is
acting to program the investment of CTIB funding for the Central LRT Corridor
Project.
The total current, estimated capital cost of the Central Corridor LRT project is $892
million. Financial commitments to the Project are:
• State (10 %)
• HCRRA (3 %)
• RCRRA (7 %)
• CTIB (30 %)
• Federal (50 %)
The terms and conditions of CTIB's funding commitment will be addressed through
the CTIB grants process. A grant application must be submitted and reviewed by
GEARS and the Metropolitan Council; and CTIB will award the necessary grants and
enter into grant agreements with the Metropolitan Council.
B. Operating Funding
Minnesota Statutes Section 398A.10 (2008) prohibits county regional railroad
authorities from contributing any funds to pay operating and maintenance costs for a
light rail or commuter rail project after January 1, 2009. Yet, the current
arrangements with the Metropolitan Council require a local contribution of 50% of the
operating subsidy. Such projects include Hiawatha, Northstar and Central Corridor.
A similar contribution will be necessary for new BRT transitways, including Cedar
I]
Approved: August 20, 2008
and 1 -35W South. In order that local property tax levies may be set appropriately
and in a timely manner, this ITIF commits the CTIB to provide the local 50% share of
transitway operating subsidies within the MTA, as listed below.
Specifically, the CTIB-commits:
1. An amount equal to 50% of total operating subsidy for Northstar
Commuter Rail.
2. An amount equal to 50% of total operating subsidy for Hiawatha LRT.
3. An amount equal to 50% of total operating subsidy for new and expanded
Cedar Avenue Bus Rapid Transit (BRT).
4. An amount equal to 50% of total operating subsidy for new and expanded
1 -35W South BRT.
5. An amount equal to 50% of total operating subsidy for Central Corridor
LRT.
The terms and conditions of these funding commitments will be addressed through
the CTIB grants process. The amount of the annual operating grants will be
negotiated with Metro Transit and agreed to by the CTIB. Grant applications must
be submitted and reviewed by GEARS and the Metropolitan Council; and the CTIB
will award the grants and enter into the necessary grant agreements with the
Metropolitan Council.
Section 6. TIMELINE
A. Funding Commitment Resolutions completed August 20, 2008
B. Grant applications due October 1, 2008
C. GEARS review and ranking completed October 13, 2008
D. Metropolitan Council consistency review completed October 13, 2008
E. CTIB Grant Awards completed late October /Early November, 2008
3
Counties Transit Improvement Board (CTIB
GEARS Committee members
Anoka County Commissioner Dennis Berg, alternate Commissioner Dan Erhart
Dakota County Commissioner Thomas Egan, alternate Commissioner Paul Krause
Hennepin County Commissioner Gail Dorfman, alternate Mark Stenglein
Ramsey County Commissioner Toni Carter, alternate Janice Rettman
Washington County Commissioner Dick Stafford, alternate Commissioner Bill
Pulkrabek
Metropolitan Council Chair of Transportation Committee Mary Hill Smith
Anoka County City Rep: Mayor Tim Howe, City of Coon Rapids
Washington County City Rep: Mayor Bill Hargis, City of Woodbury
Dakota County City Rep: Councilmember Ruth Grendahl, City of Apple Valley
North Hennepin County City Rep: Mayor Steve Lampi, City of Brooklyn Park
South Hennepin County City Rep: Mayor Jim Hovland, City of Edina
Ramsey County City Rep: Mayor Craig Klausing, City of Roseville
Hennepin County City Rep: Councilmember Robert Lilligren, City of Minneapolis
Ramsey County City Rep: Councilmember Russ Stark, City of St. Paul
Fridley's Northstar Funding to be Decided Soon
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The latest Northstar news is that we are still waiting to hear whether or not the Fridley
station site will receive funding that will be distributed from the newly established 1 /4%
sales tax that was approved in 2008 after the Legislature overrode the Governor's veto.
Under the terms of the legislation, the money is to be distributed by a newly established
board, the County Transit Improvement Board, or CTIB Although CTIB has the ultimate
authority to make grant awards, it will be guided in making its decisions by an advisory
group known as the Grant Evaluation and Ranking System or GEARS Committee. Both
groups are comprised of representatives from the counties and cities that are in the five
metropolitan counties that have chosen to levy the additional sales tax.
Fridley staff has also been told that there will be a 2008 distribution of the sales tax
proceeds that were collected between July and December of 2008. Additionally we have
learned that the distribution of sales taxes collected in 2008 and a portion of 2009 will be
made under special guidelines that apply only to this interim period. Thereafter
permanent guidelines will guide the distribution process.
In general, the $70 million in 2008 sales tax receipts that is expected to be available may
be distributed for both capital costs and operating subsidies of "transitways." We also
know that the legislation requires that the first $30.8 million of the new money is
reserved for operating subsidies for the Metropolitan Council's Metro Transit System
This will leave $39.2 for distribution for other capital and operating costs.
The guidelines also prescribe that only the Northstar Commuter Rail, the Cedar Avenue
Bus Rapid Transit, and the Central Corridor Light Rail Transit are eligible for capital
grant funding. In addition to the Metro System operating set aside, other eligible
operating grants include those for the I -35W South Bus Rapid Transit, the Cedar Avenue
Bus Rapid Transit, the Hiawatha Light Rail Transit, and the Northstar Commuter Rail.
All grant applications must be made through one of the five counties that have adopted
the sales tax.
At this point, we understand that the Anoka County Regional Rail Authority is compiling
information for submittal of a grant on behalf of the Fridley station site. According to
Tim Yantos, Director of the Anoka County Regional Rail Authority, the Anoka County
Regional Rail Authority will only be asking for funding for the Fridley station site. The
amount being requested is $10.6 million. As it is currently defined, the local match will
consist of the City of Fridley's expenditure for land on the east side of the railroad tracks
(approximately $3.2 million). The grant application must be submitted by October 1. The
GEARS review and ranking of the applications should be completed by October 13. The
final decision by CTIB is expected to be made by the end of October.
Although we have been told informally, that the Fridley station will be a high priority for
grant funding, we also recognize that there is lots of competition for a very limited
amount of money. Should Fridley be successful in getting the grant funding, the bidding
process for construction of the Fridley station will begin immediately. We also
i
understand that if the funding is awarded this fall, the Fridley station will be on line for
the beginning of the Northstar Commuter Rail operations.
If you have questions or comments that stem from this article,-please-direct them to Paul
Bolin, Assistant Director for the Fridley Housing and Redevelopment Authority. He may
be reached at 572 -3591 or at bolinpQci.fridley.mn.us.
Vokom
FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY
September 4, 2008
Poo
IM13
1. Concerned Citizens of Fridley
Pam Reynolds of the Concerned Citizens of Fridley has requested that I attend their September 11``'
meeting to discuss the "ins and out's" of Tax Increment Financing. According to Ms. Reynolds there
seems to be a number of misconceptions and ideas amongst their group as to how TIF actually works.
2. Foreclosures
Our most recent data from Anoka County indicates that between January 1 and July 31", the City of
Fridley had 84 foreclosures. This compares with 58 foreclosure sales through July of 2007. When
projected to the end of 2008, the number of Fridley foreclosures should reach 142. This compares with
116 foreclosures in 2007
To help ease the burden for those currently in mortgage difficulty, the City has initiated a mortgage
foreclosure workshop in cooperation with the Anoka County Community Action Program (ACCAP), and
the cities of Columbia Heights, Spring Lake Park and Hilltop. The workshop will be held at the Fridley
Community Center on September 17th.
3. Home Loan Program / CEE
CEE has hired Erica Berg to replace Kristin De Grande. I have a meeting with Erica and Dave King
from CEE next Thursday to discuss the formatting of the monthly data that they provide.
In August, a total of 2 loans were closed and 1 remodeling advisor visit happened.
5. Gateway Northeast Land Acquisition
I haven't heard a thing from the Alano Society since they got rid of their realtor a few weeks back. They
were going to have some of their attorney members review the Purchase Agreements that have gone back
and forth and then get back to us.
I did receive an updated appraisal for the Tae Kwon Do center. The new value is $320,000, up from the
$275,000 it was valued at in December of 2006. Unless objections are raised, we will proceed to make a
final offer to the TKD Center with this new value and very minimal relocation assistance. Though this
price seems high, Lake State Realty services used the same methodology that they did before and I am not
able to find any fault in their value. The cost to acquire this voluntarily will be much less expensive than
if we need to acquire the property through condemnation or the threat of condemnation. The executive
summary of the appraisal is attached.
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.fddley.mn.us
11
Executive Summary
ADDRESS:
6061 University Ave. NE, Fridley, MN 55432
PROPERTY TYPE
One level commercial building housing a Tae Kwon Do
studio
OWNER
Per Anoka County Tax Records, the owner is Kim II Kuen
and Oak Hee
INTEREST APPRAISED:
Fee Simple
APPRAISAL PURPOSE
Estimate Market Value
APPRAISAL USE
Internal planning purposes and possible negotiation purposes
related to proposed fee title purchase
SITE SIZE
13,000 s.f. per the lot size in the Anoka County Tax
Records (in addenda of report)
ZONING:
C-2, General Business District, as governed by the City of
Fridley
HIGHEST AND BEST
As vacant: Commercial use
USE
As improved: Existing use
FIVE YEARS SALES
According to county records the subject property has not
HISTORY:
transferred in the last five years
IMPROVEMENTS:
A single one -level building with 2,482 s.f. (with a partial
basement level)
PROPERTY I.D. #:
23- 30 -24 -21 -0111 & 23- 30 -24 -21 -0110
ASSESSOR'S
Land = $125,900
ESTIMATED PROPERTY
Improvements $148,000
VALUE FOR BOTH
Total = $273,900
PARCELS COMBINE
(2007 estimated values for
2008 payable taxes):
PROPERTY TAXES
.$7,571.54 with a special assessment amount of $79.97
(2006 payable):
VALUE BY COST APPROACH:
N/A
VALUE BY MARKET APPROACH:
$320,000
VALUE BY INCOME APPROACH:
N/A
APPRAISER'S ESTIMATE OF MARKET VALUE $320,000
DATE OF VALUATION:
August 22, 2008, the date of most recent inspection
Paul G. Schwartz, Certified General Appraiser, MN
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Adiustment Analysis
The comparables located are the best available. Primary , search criteria was similar
buildings which sold in the subject's northern suburban market area. A total of five
applicable and recently transacted comparables were located. Although these
comparables are similar to the subject, differences exist which need to be accounted
for in the adjustment process. -T a individual adjustments are explained following.
Time: The comparables sold from 1/05 to 2/07. Each was adjusted based on 4% per
annum, or .33 %-per month. This time adjustment is based on appreciation which has
occurred in the market, which has slightly exceeded inflation or regional CPI's during
the same time period. Real estate has continued to perform well as an investment,
however, with rising interest rates, and superior returns in other investments,
appreciation in the commercial Twin Cities marketplace has slowed. This time
adjustment is warranted, and supported by appreciation for other types of commercial
real estate within the Twin Cities market, however, it is recognized that much of this
time adjustment is based on other economic pressures such as inflation or changes in
the CPI, which have averaged about 3% during the time period analyzed.
I- Use/Zoning: Use and zoning are grouped under one category, as the use is dictated
typically by the underlying zoning. Comparable 3 is zoned M -2, a manufacturing
zoning, while comparable 4 is zoned I, an industrial zoning. As manufacturing and
industrial zonings do not allow as wide a variety of commercial uses and as
commercial uses are typically more valuable than manufacturing or industrial uses, a
+ 5% adjustment is applied. Comparable4, however, purchased by the Anoka County
Highway Department for right of way use is adjusted an additional -10% as typically
government units pay a slight premium for property to avoid eminent domain
proceedings. In this instance, Anoka County does not pay any more than 10% above
the appraised value, for an adjustment of the same.
Year Built: For existing buildings, the market places emphasis on condition over that
of age, considering the variance of maintenance which can bring a building's effective
age to that less than its chronological age. No adjustment is applied for year built, but
for two comparables, one which is significantly older (built in 1908) and one that is
significantly newer (built in 1989). This rather nominal 5% adjustment considers
changes in construction practices versus anything related to condition, which is
addressed below as a separate line item.
Condition: The subject is deemed to be in average -good condition. This is similar to
comparables 3 and 5,-which do no require adjustment. Comparable 1 is in very good
condition and is adjusted -20 %. Comparable 2 is in fair condition and is adjusted
+25%. Comparable -4 -is in good condition and is adjusted -10 %. The adjustments
are based on the approximate dollar amount it would take to bring the inferior
_27
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1
condition property into similar condition as the superior condition property.
Gross Building Area (GBA): The subject is 2,482 s.f. in size and the comparables are
both smaller and larger. An adjustment based on1 % per every 1,000 s.f. of difference
is applied. In real estate, typically the more units purchased, the less paid per unit.
Site Size (Land- to Building Ratio): - The -subject is located on a smaller site, but has a
land to building ratio of 5.24:1. The comparables have both larger and smaller land
to building ratios. A higher land to building ratio is positive, meaning there is more land
component per each s.f. of building component. Having more land is desirable for
other on -site amenities and improvements, as well as future expansion opportunities.
Although one comparable is smaller than the subject, it is deemed similar enough to
not warrant an adjustment. The remaining comparables are adjusted 1 % per each unit
of ratio is applied, recognizing the approximate contributory value of additional land for
a commercial establishment.
Location: The subject has a desirable location on a major thoroughfare. All the
comparables are also on a main thoroughfare and do not require adjustment.
Construction Type: The subject is a wood frame structure, as is comparables 1 and
5 which do not require adjustment. The remaining comparables are masonry
construction, a superior construction type. They are adjusted -5% for their superior
construction type and resulting quality.
After adjustments, the comparables range from $118.67 to $135.33/s.f. The
adjusted average is $128.59/s.f., which is similar to the adjusted median, at
$129.85/s.f. All comparables are similar to the subject and have gross and net
adjustments within accepted norms. With consideration of the adjustment analysis,
as well as the'ample amount of similar comparables with non - subjective adjustments,
an amount for the subject similar to the adjusted average and median of $128.50/s.f .
is concluded.
The subject's value is therefore computed as follows:
2,482 s.f. X $128.50/s.f. = $318,937, say $320,000
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