HRA 04/02/2009 - 6218Vdknm
FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY
April 25 2009
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I. Columbia Arena Site
Amcon Construction and Dunbar Development Corporation have teamed up to bring a medical facility
(Fridley Clinic) and senior housing (Walker Methodist) to the site. I have attached an early draft of the site
plan / building design. The parties anticipate asking the HRA for TIF Assistance to get the site "pad
ready" for new construction. It is anticipated the value of this site will increase from roughly $2.5M to
$25 +M after construction. Attorney Casserly and I have had some very preliminary discussions with the
developers and anticipate a formal TIF Application in time for the HRA to take some action on this
request at the May Th meeting.
2. Foreclosure NRP
As you are aware, Anoka County received $2.3 M in Federal Neighborhood Stabilization Program (NSP)
funds to address housing needs in communities with "greatest need ". This program mirrors CDBG in
much of its administration but has components that are very different and specific. Because of the
difficulty in administering and reporting on the program, Anoka County will run the program County-
wide.
The money will be used to purchase foreclosed vacant homes to be rehabbed and resold or demolished.
The County will also issue forgivable fix up loans to 1" time home buyers, meeting income criteria, willing
to rehab and live in the home for 10 years. Anoka County anticipates receiving the funds and starting the
program within the next few weeks. I have been working with Kate Thunstrom (program coordinator) to
keep her up to date with the homes eligible within the City. I will continue to keep you update as this
program evolves.
3. Gateway West Update
It appears that Blueprint Homes continues to have the cash flow problems that a number of builders are
having in this current market. Earlier this week I learned that Alpine Capital (Blueprints lender) is taking
back the homes at 271 57b Place, 5901 3d Street, and 5911 3d Street, as Blueprint has not been able to
sell the homes. After a much too long wait, siding has finally been delivered to the home located on the
comer of 57th Place and 3"' Street and will likely be installed by the time you are reading this update.
Despite everything, Blueprint remains very optimistic about the future of the development and is
currently courting a few potential homebuyers. As I had mentioned a few months ago, the HRA may
want to consider other options for the remaining lots. Potential options include selling the remaining lots
through our scattered site program (HRA would need to approve all home plans), allowing a potential
homeowner to work with a builder of their choice or choosing a few select builders to build homes on
the refraining lots in an arrangement similar to the one we have had with Blueprint. I have recently been
contacted by another custom builder who expressed an interest in the site. Attorney Cerney and I have
had some brief discussions on the current development agreement and will be bringing a
recommendation forward at the May meeting.
4. Nortbstar Update
Construction
Lund - Martin, the contractor has been gearing up to start the construction. If you've been by the site
you've noticed the large amount of equipment and materials that have been moved to the site. To date
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the contractor has opened up the end of the tunnel and is preparing to install the sheet piling necessary
for constructing the platform. I will send out weekly construction notices as I receive them from the
Northstar Project office.
Ground Lease Agreement
After spending too many hours drafting the MOU for the terms to be included in the ground lease, we
are now meeting on the Ground Lease itself. Earlier this week staff met with HRA Attorney's Casserly
and Cerney, the Met Council's Peter Hanft & Mark Fuht-man, and Northstar's Tim Yantos and Mary
Richardson. In one and % hours we covered many issues and seem to have some consensus that we are
all in agreement on the issues. Another meeting has been scheduled for end of April and we will provide
you with a draft of the agreement prior to your May meeting. The June meeting is the soonest that we
would ask you to take any action on this item.
Tour of Big Lake Maintenance Facility
Just a quick reminder that the tour /open house for Commission /Council /Staff is taking place next
Thursday April 2nd from 4 -5:30. Those wishing to carpool can meet at City Hall at 3:15, please let me
know by Tuesday if you will be joining us. At the time of writing this, I have had attendance /ride
confirmation from Commissioner Gabel and Councilmember's Bolkcom & Varichak.
Station Area Planning / joint Council Meeting
Staff is STILL awaiting confirmation from the Northstar Project Office on a final date /time / location
for the line -wide Transit Oriented Design workshop.
Joy Miciano of the Northstar Project provided the following on March 19th: We are looking at
dates towards the end of April,- but this is all dependent on the
speakers availability. The time we are thinking of is 3:30 pm to
6:00 pm and the location would either be at the Coon Rapids City
Hall or the Anoka County Government Center. Originally, we were
trying to have two sessions one for planners and another of public
officials, but we realized there was a great deal of overlap in the
information that needed to be presented. The workshop is designed
around hearing from you, the cities, and providing advice or
recommendations from professionals experienced in TOD: a planner
from a new or established commuter rail, a developer, a person
working in public finance, and land preservation and enhancement.
Once a firth time, date and location have been set I will pass the information on to you immediately so
that you can put it on your calendars.
Staff has decided that we. cannot postpone our joint HRA /Council meeting any longer. The joint
meeting has been postponed since last November, pending the TOD workshop. Though it would be
ideal to have everyone attend the TOD workshop prior to the meeting, we simply can't wait any longer to
begin discussion on the area's future. Therefore, we are proposing holding the joint HRA /Council
meeting on THURSDAY, MAY 7d'@ 6PM. The regular HRA meeting will follow the special meeting.
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5. Gateway Northeast Update
Select Products
The closing on this property will take place at the end of April.
Sikh Society
The Sikh's have not been able to get a majority of their members together in order to hold a vote on the
sale of the property.
Tae Kwan Do
Mr. Kim has continued to say he has some interest in selling, that our offer price is still too low, but still
has not made any counter to our most recent offer. Dan Wilson was instructed again to tell Mr. Kim that
the HRA is not going to spend any more time or money on Dan's services for this acquisition; that we are
done negotiating against ourselves.
6. Special Legislation — Scattered Site TIF District
Staff has been. working with Community Development Staff, legal Counsel, and MN Solutions to obtain
legislation that would in essence re- authorize 1995 Minnesota Laws, Chapter 264, Article 5; Sections 44-
47 in order to continue the Scattered Site program. The legislation has already passed through the Senate
Tax Committee and will have a hearing before the House Tax Committee on Friday April 3rd.
I have attached the summary sheet we have been using down at the legislature. It is a good summary of
why we need this legislation.
7. Moore Lake Drive Landscape Improvements:
Scott Hickok reports the following:
Good News! There has been considerable progress since we last met on the East Moore Lake Landscape
Project. What is being asked of the HRA in terms of their contribution is $4900.00 (nearly $8,000 less
than we had discussed with the HRA previously).
Also, after out last HRA meeting, Stacy Stromberg and I met with the property owners and /or their
representatives from East Moore Lake Drive. The purpose of that meeting was to discuss the landscape
project, and solicit their support for moving ahead. The four largest land owners were present. We had
committed to meet with Frank Masserano, the owner of the International Ministerial Foundation building
(IMF the 5t' Property), separately. Unlike the other 4 owners, Mr. Masserano's property is relatively small
and has only two planters. Like the HRA, it makes more sense for the IMF property to simply pay to
have their planters replanted. Staff determined that even though there are 6 owners along the corridor; it
would not make sense to split the project 6 ways. That slit would not be equitable for the IMF or HRA
property owners, whose properties are considerably smaller.
Four of the other five property owners have said yes to the expenditure and they are enthusiastic about
getting started on the project. These owners are: Quality Growth (Shortstop/ Fridley Optical Center),
U.S. Swim & Fitness, George Applebaum (Dentist /Ax man /Subway Center), and Frank Masserano, IMF.
The Jacob's Trading /Only Deals folks declined the offer to participate. Their staff members who we met
with were enthusiastic about the improvements, but could not convince their Business Manager to
participate due to the need to budget for an increase in taxes that they were not anticipating. We will
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again (between now and your May meeting) attempt to persuade this owner to participate, since Finance
Director, Rick Pribyl has indicated that we can assess the cost to those owners over a 5 year period. If this
owner doesn't participate, we think it will be unfortunate; however, we are not going to let that fact stop
us from making all of the other improvements on the other properties.
Our recommendation to the HRA would be to be prepared to vote on an action item in May to authorize
the expenditure of a value not to exceed $4900.00 to participate in the Moore Lake Landscape
Revitalization Project. In the meantime, staff will be seeking additional bids for the HRA planters to
assure
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
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City of Fridley Housing Replacement Plan
Legislative Summary 2009
Background: The City of Fridley is seeking legislation that would reauthorize for the City
1995 Minnesota Laws, Chapter 264, Article 5, Sections 44-47, as amended (the "Housing
Replacement Program ").
In 1995 the Legislature gave the City of Fridley, along with six other cities, the ability to create
multi - phased scattered site housing replacement TIF Districts. The Law allowed the City of
Fridley a total of 10 years to acquire up to 50 homes.
The City did utilize this program successfully until housing values started rising rapidly and the
City's ability to place more sites in the program expired in 2004. With the drop in market
values, due to foreclosures and the overall economy, now would be an opportune time to
reenact this program within Fridley as the City had a total of 140 mortgage foreclosures in
2008 alone. Over the past year the median home value in Fridley has dropped from $205,000.
to $179,900 and the median value of lender mediated foreclosed homes has decreased from
$161,500 to $135,000(Source: Minneapolis Area Association of Realtors).
Public Purpose: Housing is essentially the determining factor by which a city is initially
judged, and, as a result, reflects the character of the City and the characteristics of its
residents. The current mortgage foreclosure problem has created areas within the City that
may negatively reflect on its character and that of its residents. Fridley's -neigh borhoods are
potentially much more valuable, productive, and stable than is currently realized due to the
number of dilapidated and vacant homes resulting from foreclosures and the current state of
the economy.
The City and its Housing and Redevelopment Authority have determined that it is in the best
interests of the City to reestablish its Housing Replacement Program.
Proposed Legislation: The proposed legislation reauthorizes the Housing
Replacement Program for Fridley and provides for additional flexibility by increasing the
number of parcels eligible for inclusion to 100, eliminating a match requirement and providing
for additional flexibility in the use of existing tax increment. The City of Fridley needs the
Housing Replacement Program to help revitalize its neighborhoods now being impacted by
blight due to foreclosures. As a first ring suburb with older homes and no land for new
housing development, the City needs to maintain and enhance its existing neighborhoods by
removing dilapidated properties.
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