HRA 10/01/2009 - 6223October 1, 2009
HRA Meeting
Regular Meeting Agenda
7.00 p.m.
City Hall, Council Chambers
Call to order
Roll call
Action Items
1. Approval of expenditures
2. Approval of September 3, 2009, Meeting Minutes
3. Approval of Resolution Declaring Certain Properties Blighted & Authorizing
Demolition of Properties
4. Approval of Home Improvement Demonstration Program
5. Approval of TIF District #20 for Columbia Arena Redevelopment
Informational Items
1. Housing Loan Program Update
Adjournment
H:\My Documents\HRA12009 HRA Agendas \October 1 -2009 Agenda Outline (2).docH:UV1y Documents\HRA\2009 HRA
Agendas \October 1 -2009 Agenda Outline (2).doc
CITY OF FRIDLEY
HOUSING AND REDEVELOPMENT AUTHORITY COMIVIISSION
SEPTEMBER 3, 2009
CALL TO ORDER:
Chairperson Pro Tem Gabel called the HRA Special Meeting to order at 7:04 p.m.
ROLL CALL:
MEMBERS PRESENT: Pat Gabel
John Meyer
William Holm
MEMBERS ABSENT: Larry Commers
NONMEMBERS PRESENT: Paul Bolin, HRA Assistant Executive Director
Scott Hickok, Community Development Director
Jim Casserly, Development Consultant
ACTION ITEMS:
1. Approval of Expenditures
NONE PRESENTED
2. Approval of August 6, 2009, Meeting Minutes
MOTION by Commissioner Holm to approve the minutes as presented. Seconded by Commissioner
Meyer.
Chairperson Pro Tem Gabel asked for a correction on page 7, second paragraph, second line, add the
word "month" after next.
UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON PRO TEM GABEL DECLARED
THE MINUTES APPROVED AS AMENDED.
3. Approval of 2009 Tax Levy for Taxes Payable in 2010
Paul Bolin, HRA Assistant Executive Director, said that the MN Statutes authorize HRH's to levy
properties within their community to support the housing and redevelopment efforts. This levy is equal to
.0185% of taxable market value. The 2010 levy will allow HRA to collect $498,000,
Mr. Bolin said that the impact on taxpayer for a $150,000 home would be $27.75 and a $1.0 million
commercial property would be $185.00. Staff recommends approval of the resolution consenting to the
HRA Tax Levy. Approval would provide HRA the ability to fund ongoing and future redevelopment
efforts. It would also provide the ability to meet housing needs (address foreclosure issue). The levy will
be certified and delivered to the County on September 15, 2009. City Council will act on this item
September 14, 2009.
MOTION by Commissioner Holm to approve the 2009 Tax Levy for Taxes Payable in 2010 as
presented. Seconded by Commissioner Meyer.
Chairperson Pro Tem Gabel asked about the value of the lots and if the City Assessor mentioned
anything about the value of the properties in Fridley.
Paul Bolin, HRA Assistant Executive Director, said that he has not discussed anything recently with the
City Assessor. Comparing the levy amounts that are being received in 2010 versus what was projected
for 2009, the amounts are a few thousand dollars less which shows there has been a decline in the city
wide market value.
UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON PRO TEM GABEL DECLARED
THE MOTION CARRIED UNANIMOUSLY
4. Approval of TIF District #20 — Columbus Arena
Paul Bolin, HRA Assistant Executive Director, said that the developer has asked that the HRA postpone
taking any action on this item until October 1'. The developer sent a letter stating: "We continue to work
on all the various components of our proposed redevelopment of the Columbia Arena site along
University Ave. We find ourselves in a position at present where we need to request that our application
review be continued from this Sept 3rd meeting to the October HRA meeting. We will continue to update
you as to our progress."
MOTION by Commissioner Meyer to table this item until the October 1, 2009 meeting. Seconded by
Commissioner Holm.
UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON PRO TEM GABEL DECLARED
THE MOTION CARRIED UNANIMOUSLY
5. Approval of Northstar Ground Lease
Paul Bolin, HRA Assistant Executive Director, said the ground lease is ultimately between the HRA and
Metropolitan Council. Many players are involved and other agreements are interwoven between
ACRRA, CTIB, Metro Transit, MnDOT and BNSF. The lease agreement simply spells out details of
Metro Transit's use of HRA property for Northstar Rail parking and access to the platform. Staff
recommends HRA hold a public hearing on this item tonight and approve the agreement as presented.
Commissioner Meyer asked if the Public Hearing was publicized.
Mr. Bolin answered yes, the statutory requirements for the public hearing have been met and were posted
August 21 in the Minneapolis Star Tribune. The information needs to be published one time, no more
than 30 days before and no less than 10 days before the hearing is held.
Chairperson Pro Tem Gabel asked about the land and clarified that the HRA is owner of the land.
Jim Casserly, Development Consultant, stated that HRA was owner of the land and explained the
modifications to the agreement related to liability. The Metropolitan Council met some compromised
language and some language was prepared which was used; some of the language they had proposed and
modified some sections of the document. If the property had been sold this discussion wouldn't be
happening. A 200 year lease is starting and HRA is not in the business of operating the business.
Mr. Casserly said that there is a simple way to address this in that the indemnification doesn't waive any
rights under our statutes. They accepted the language and that was the only issue that remained. The
reason for entering into this lease arrangement is to allow the HRA to have a little better control over the
property.
Mr. Casserly said that HRA was very careful as to what was being leased and has no rights below or
above the surface area. Over time HRA will probably want to redevelop that site as portions are
available. There is even an agreement to substitute storm water management and to share costs going
forward.
Mr. Casserly said that what HRA is committed to is to keep the same number of parking stalls, but the
parking could go vertical. HRA's purpose is to try to encourage development in an area of town that is
currently under utilized. The key is not to come back in four years and ask for permission to develop the
area. Everyone involved with this project would like to see the area developed.
Chairperson Pro Tem Gabel said that HRA appreciated all the work that has went into this lease. It is a
lot of work but it's exciting.
MOTION by Commissioner Holm to approve the Northstar Ground Lease. Seconded by Commissioner
Meyer.
UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON PRO TEM GABEL DECLARED
THE MOTION CARRIED UNANIMOUSLY
6. Approval of Sign Easement/Agreement with Fairview Clinics
Scott Hickok, Community Development Director, said that Fairview and Columbia Park have merged,
converting all clinics to Fairview. Fairview is proposing to put a sign on the parking lot they lease from
HRA. Fairview has offered to erect a sign that would serve both their needs and the City's (electronic
readerboard). Staff recommends approval of the resolution authorizing agreement permitting the
construction and operation of the sign in the proposed location.
Commissioner Meyer asked what would happen to the police sign that is on the existing sign and how
important that sign is.
Mr. Hickok said that it is important to have a police indicator out there and staff will work with the sign
contractor to keep a sign out there.
Commissioner Meyer asked about the electrical charges and who would pay for that as time goes on.
Mr. Hickok said that Fairview would pay for installment; maintenance etc. and the city can change the
messages as they would like. Maintenance and other costs are born by Fairview.
Chairperson Pro Tem Gabel asked what would happen to the sign if the clinic moved to a different
location.
Mr. Hickok said that the agreement was written so that it would not eliminate future tenants from using
the sign. Fairview plans to be here for a long time but the future user of the building could use the sign.
The new tenant would put their name on the sign but recognize the other provisions in the contract.
Chairperson Pro Tem Gabel said that this is a great opportunity for Fridley. The community billboard
will be better utilized with the electronic technology.
MOTION by Commissioner Holm to approve the resolution authorizing the execution and delivery of
parking and sign easement agreement by and between the HRA and for the City of Fridley and Fairview
Fridley Clinic. Seconded by Commissioner Meyer.
UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON PRO TEM GABEL DECLARED
THE MOTION CARRIED UNANIMOUSLY
MOTION by Commissioner Holm to approve the parking and sign easement agreement between HRA
and the Fridley Fairview Clinic. Seconded by Commissioner Meyer.
UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON PRO TEM GABEL DECLARED
THE MOTION CARRIED UNANIMOUSLY
7. Continuation of Discussion on Northstar Transit TIF District
MOTION by Commissioner Holm to remove the discussion of the Northstar Transit TIF District from
the table. Seconded by Commissioner Meyer.
UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON PRO TEM GABEL DECLARED
THE MOTION CARRIED UNANIMOUSLY
Paul Bolin, HRA Assistant Executive Director, said that the 2007 and 2008 Legislative Sessions gave the
City the ability to create a special TIF district to fund public improvements around the Northstar Station
area. HRA discussed district creation in June but current economic conditions cloud the timing of district
creation. This item was tabled and Staff was asked to bring item back for discussion. JLT has no
immediate plans for development.
Mr. Bolin said that staff recommends to keep this item tabled for a few more months. Staff has a meeting
coming up the middle of this month with the group that owns the Cub Foods site and they have talked in
the past about redeveloping this site. Staff does not see an immediate need at this point to go forward
with this item.
Commissioner Holm said that he was the one who asked for this to be tabled because he was concerned
a developer would come in before a TIF District was created. Currently this is not an issue and he
recommended to put this back on the table.
Commissioner Meyer said that HRA doesn't want something to happen on that site before a TIF District
is created. He asked what was in place to prevent this from happening.
Jim Casserly, Development Consultant, said that it's not the TIF District that imposes restrictions;
restrictions are voluntary that a property owner /developer would have if they were looking for assistance
from the district itself. A number of parcels can be put up in a TIF District because it would impact a
much broader area. This particular parcel is extremely significant to generate revenues with public
improvements.
Mr. Casserly said that what we would like to see is a more intense development of that parcel. A
problem a developer would have with that parcel is to create density with parking deck construction cost
assistance. If you want more density you have to overcome some of the parking costs. If anyone is
looking for that type of assistance, we will be working with them for a long time. If they don't need
assistance, they will be working with the city for permits etc.
Mr. Casserly said that so much work has been done in this area, a tax increment district can be put
together in 60 days because nothing needs to be qualified. The district can be created by statute.
Commissioner Meyer said that if a Walmart moved into that space it would be detrimental to our
activities. He thought a TIF District should be created to have some control of what is going on in that
area.
Mr. Casserly said that unfortunately it is City Council's job to create the land use. If an owner of the
land wishes to have intense usage of the land they would contact the HRA. HRA has control of the land
use in a voluntary way through a development agreement tharwould accompany any assistance.
Scott Hickok, Community Development Director, reminded HRA that there is a benefit of being
involved, a big box is not what is desired in that space, an intensified use has a value impact. Retail,
office and residential has impact as a developer. The TIF Financing may help a developer put parking on
the site that they would not normally do themselves. There are great benefits with TIF for a developer.
There are certain risks in not having control of what happens on that property.
MOTION by Commissioner Holm to table the discussion of the Northstar Transit TIF District.
Seconded by Commissioner Meyer.
UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON PRO TEM GABEL DECLARED
THE MOTION CARRIED UNANIMOUSLY
INFORMATIONAL ITEMS:
1. Housing Loan Program Update
Paul Bolin, HRA Assistant Executive Director, said that the Fridley HRA Loan Program closed one RLF
loan in August making a year to date total of eight RLF loans and two other loans. The Remodeling
Advisor Visits for the month of August was one making a total of 12 year to date.
NONAGENDA UPDATE:
Paul Bolin, HRA Assistant Executive Director, said that staff has discussed the possibility of doing a
home improvement demo program similar to what Coon Rapids has done. The City would find a home
under $100,000 that has been through the foreclosure process that is structurally sound but needs work
done. One of the first homes to do would be a rambler.
Mr. Bolin said that the City would work on proposals from remodelers who have done work in similar
homes and select the top builder to work with them to improve the home. An open house would be held
before the project starts and then throughout the process more open houses would be held so people could
see the progress. Lastly the home would be staged for sale.
Mr. Bolin said that this program would take care of foreclosed homes currently sitting vacant and would
be a way for the City to demonstrate to residents what can be done to update the homes in Fridley.
Another goal of this program would be to promote how inexpensive some of these upgrades can be. This
will not be a long term project. Information will be brought to the October meeting for some formal
action. The program basically pays for itself.
ADJOURNMENT:
MOTION by Commissioner Meyer to Adjourn. Seconded by Commissioner Holm.
UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON PRO TEM GABEL DECLARED
THE MOTION CARRIED UNANIMOUSLY AND THE MEETING ADJOURNED AT 5:05 P.M.
Respectfully Submitted,
Krista Monsrud, Recording Secretary
ACTION ITEM
11111LI HRA MEETING OF OCTOBER 11 2009
CRY OF
FRUREY
Date: September 23, 2009
To: William Burns, City Manager
From: Paul Bolin, Asst. Executive HRA Director
Subject: Gateway NE Blight Declaration
Due to on -going costs, potential liabilities, and the deteriorated condition of the
properties purchased for the future Gateway Northeast redevelopment project, Staff is
recommending the buildings be demolished within the next few months. Prior to
demolition both the HRA and City Council are required to adopt a resolution declaring
the properties blighted.
In addition to displaying a very poor image along our busy thoroughfare, we continue to
have problems with people breaking into the buildings, dumping garbage, vandalism,
and theft. In recent weeks things have started to get dangerous as people have now
started to set "booby traps" behind the buildings. A city truck recently had 3 tires
replaced because of homemade spike strip hidden behind one of the HRA properties.
Staff (City and HRA) feels that it is imperative that we demolish these properties soon,
not just to remove these liabilities but to generate excitement for a new project. The
excitement of the demolition and the opening of Northstar could be enough catalyst to
get a developer interested in the site. You may recall from our discussions last fall, that
we have 3 years to create a TIF District once demolition begins and can delay collection
of increment for an additional 4 years. Staff is optimistic that within 7 years we will have
a marquee project along this stretch of University Avenue.
The City of Fridley's Chief Building Official has inspected the properties currently owned
by the HRA along University Avenue NE. The purpose of the inspection was to
determine if the buildings met the statutory definition of "substandard ". All 6 of the
buildings inspected far exceeded the blight threshold required by TIF Statutes. The
substandard determination and the attached resolution, declaring the properties as
such, will allow the HRA to demolish the buildings prior to the creation of a TIF District.
Staff recommends the attached resolution be approved by the HRA and after adoption
of a similar resolution by the City Council staff be authorized to move forward with
soliciting competitive bids for the demolition work. The City Council will be presented a
similar resolution at their October 12th meeting.
Page 1 - Resolution No.
HOUSING AND REDEVELOPMENT AUTHORITY
IN AND FOR THE CITY OF FRIDLEY
COUNTY OF ANOKA
STATE OF MINNESOTA
RESOLUTION NO. 2009 -
A RESOLUTION DETERMINING THAT CERTAIN PARCELS ARE
OCCUPIED BY STRUCTURALLY SUBSTANDARD BUILDINGS AND ARE
TO BE INCLUDED IN A TAX INCREMENT FINANCING DISTRICT
BE IT RESOLVED by the Board of Commissioners (the "Commissioners ") of the Housing and
Redevelopment Authority in and for the City of Fridley (the "Authority") as follows:
Section 1. Recitals.
1.01 The Authority has considered the acquisition and redevelopment of the parcels
identified as follows (the "Parcels "):
Address: 5865 University Ave. NE
PIN: 23-30-24-24-0023
Address: 5925 University Ave. NE
PIN: 23- 30 -24 -21 -0140 & 23- 30 -24 -21 -0141
Address: 5945 University Ave. NE
PIN: 23- 30 -24 -21 -0143
Address: 6005 University Ave. NE
PIN: 23-30-24-21-0134
Address: 6041 University Ave. NE
PIN: 23-30-24-21-0109
Address: 6071 University Ave. NE
PIN: 23-30-24-21-0135
I
Page 2 - Resolution No.
1.02 Minnesota Statutes, Section 469.174 etseq., as amended and supplemented from time
to time (the "Tax Increment Act"), provides for the establishment of a redevelopment tax increment
financing district. The Tax Increment Act allows for the inclusion of parcels within a redevelopment
district after substandard buildings have been removed by complying with Minnesota Statutes,
Section 469.174, Subd. 10(d).
Section 2. Findings.
2.01 The Board hereby finds that the acquisition and redevelopment of the Parcels further
the goals and objectives of the Development Program.
2.02 The Board hereby finds that the Parcels are occupied by a structure or structures that
are structurally substandard, as defined in the Tax Increment Act and described in the blight report
on file with the City, and that the structure or structures must be demolished and removed from the
Parcels.
2.03 The Board hereby finds that the Authority intends to demolish or cause to be
demolished the substandard building or buildings and to prepare the Parcels for redevelopment.
Section 3. Declaration of Intent.
3.01 The Board hereby declares its intent to include the Parcels within a redevelopment tax
increment financing district and to file the request for certification of the Parcels as part of a district
with the Anoka County Auditor within three years of when the Parcels were occupied by a
substandard building or buildings.
Section 4. Notice to County Auditor.
4.01 If the Authority establishes a tax increment financing district and includes the
Parcels, then upon filing the request for the certification of the tax capacity of the Parcels as part of
such district, the Authority shall notify the Anoka County Auditor that the original tax capacity of
the Parcels must be adjusted as provided in Minnesota Statutes, Section 469.177, Subd. 1(f).
PASSED AND ADOPTED BY THE HOUSING AND REDEVELOPMENT AUTHORITY IN
AND FOR THE CITY OF FRIDLEY THIS 1St DAY OF OCTOBER 2009.
Lawrence R. Commers, Chairman
2
Page 3 - Resolution No.
ATTEST:
William W. Burns, Executive Director
KM: 4850 -2222 -5922, V. 1
�' ACTION ITEM
&
AJ
HRA MEETING OF OCTOBER 1, 2009
CRY OF
FRIDLEY
Date: September 23, 2009
To: William Burns, City Manager
From: Paul Bolin, Asst. Executive HRA Director
Subject: Home Improvement Demonstration Proiect
Last month your HRA packet included some information on a project the City of Coon Rapids
HRA had initiated, the "Homes for Generations" program. In summary, Coon Rapids selected a
contractor and a real estate broker, purchased a foreclosed 800 square foot Thompson rambler,
and then upgraded the home to suit the needs of today's families. Upon completion the home
was sold for a small profit.
Their stated purpose of the program is to encourage others to purchase and rehab foreclosures,
encourage neighboring properties to upgrade their homes, and encourage those who are trapped
in their current homes (because they are upside down on their mortgages) to make inexpensive
upgrades to their home to keep them updated for generations to come. Open houses were used to
demonstrate how inexpensive certain home improvements can be if homeowners are savvy
enough to visit the reuse center and liquidators to obtain materials.
Current market conditions make this a favorable time to do a similar project in Fridley. It would
not only remove a property or two (or more) from the foreclosure list, but could really showcase
what can be done with the existing housing stock in Fridley, encourage reinvestment, and
promote our home improvement loan program and remodeling advisor services.
After having continued conversations with Coon Rapids staff to learn from their program
successes and challenges, staff is asking that the HRA approve a motion authorizing staff and
legal counsel to undertake the steps necessary to create a similar program. There are some
specific issues that will need to be addressed to avoid some of the pitfalls of the Coon Rapids
program. Most importantly, a mechanism needs to be put in place to allow staff the ability to
make a binding purchase offer without waiting until a future HRA meeting. Coon Rapids staff
did not have authority until recently and it caused them to miss out on a number of homes as they
waited until their next HRA for authorization.
In addition to speaking with Coon Rapids staff, we have had conversations with those working
on rehab programs in Anoka, Washington and Scott Counties. Though the focus of their
programs is rehabbing properties to a livable condition (ie. improving enough to pass an FHA
inspection) using Federal NSP money, there are lessons to be learned from their experiences as
well. The comment most heard from these folks was to get a good contractor and keep a close
watch to prevent the expenses from going beyond that which was budgeted.
After this preliminary investigation into developing a home improvement demonstration
program, staff believes a program modeled on Coon Rapids can be successful in Fridley's current
economic climate. It is likely that there may be some investment from the HRA to complete the
demonstration homes.
Following are a list of the steps, not necessarily in order, that staff will undertake to move this
project forward.
- Staff / legal counsel develop resolution for approval by December HRA meeting
o Resolution will spell out specifics of plan (max. price to pay for home,
authorize board chair & staff to present purchase offer(s), etc.).
- Staff reviews list of current vacant foreclosed, for sale homes
o Identify potential homes and rough estimates of costs (home + improvements)
- Staff sets up internal process to pay for home purchases, contractor expenses, etc.
- Staff sends RFQ's to North Metro Realtors Association and the TC Builders
Association
- Staff and HRA select broker and builder
- Staff, broker, & builder select property
- Budget developed for home improvement project
- Pre - project open house held
- Open houses held at key points of renovation (50 %, 75 %)
- Upon completion, open houses held and property marketed
Recommendation:
Staff recommends that the HRA approve a motion authorizing Staff to develop the necessary
framework to implement a home improvement demonstration project in Fridley.
15 Fridley Housing and Redevelopment
Authority
Minx MEMORANDUM
DATE: September 23, 2009
TO: William W. Burns, Executive Director of HRA
FROM: Paul Bolin, Assistant HRA Director
SUBJECT: Columbia Arena TIF Request
On July 13th the City Council approved a resolution calling for a public hearing on
modifications to the redevelopment plan for redevelopment project No. 1 and the
Tax Increment Financing plans for Tax Increment Financing Districts Nos. 1, 6 -7,
9, 11 -14, and 16 -19, creation of Tax Increment Financing District No. 20
(Columbia Arena property), and approval and adoption of a Tax Increment
Financing Plan relating thereto.
Just prior to the HRH's September 3rd meeting, at which time the HRA was going
to consider the TIF District, the redeveloper of the Columbia Arena site asked
that the HRA postpone any action until their October 1St meeting. The developer
informed staff that they have been having issues getting a commitment out of the
group that was to build the senior housing. At this time the developer is pursuing
a number of alternatives for constructing the medical, not all alternatives involve
the Columbia Arena site.
As the public hearing had been advertised, the Council will formally postpone the
public hearing until their October 12th meeting. It is possible that the developer
may ask the HRA to take no action in October. You will be provided the most up
to date information at your meeting next week.
Fridley HRA
Housing Program Summary
Cover Page
October 1, 2009 HRA Meeting
Report Description
Loan Application Summary Loan application activity (e.g. mailed
out, in process, closed loans) for
September and year -to -date.
Loan Origination Report
Remodeling Advisor
Loan originations for September and
year -to -date.
Shows the number of field appointments
scheduled and completed the
Remodeling Advisor Services
administered by Center for Energy and
Environment.
H:\— Paul's Documents \HRA\IIRA Agenda Items\2009\May 7, 2009\Housing Program Cover May.doc
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FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY
October 1, 2009.
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1. Northstar Update
Construction
Construction has continued at an accelerated rate in preparation of the revenue service starting on November
Ground Lease Agreement
Signature pages for the Ground Lease have just started to make their way around to the different
parties involved.
Kick -off Event — November 14th
Each of you will be receiving a air of tickets from Northstar to ride the train into Minneapolis and
back on Saturday November 14t . More detail will follow.
Schedule
Metro Transit provided the following schedule, now approved by BNSF, for weekday trips.
AM: SB trains arrive at 5:31 am, 6:20am, 6:50am, 7:20am and 7:50am.
AM: NB train arrives at 6:22am.
PM: NB trains arrive at 4:07pm, 4:37pm, 5:07pm, 5:37pm and 6:27pm.
PM: SB train arrives at 5:34pm.
2. Cub Foods Redevelopment
Staff recently met with Tri-land Properties, owner of the Cub Foods site, to discuss their proposed
redevelopment of the site. Cub Foods also had a representative at the meeting. Though things are
very preliminary, it does appear that Cub and Fridley liquor will be relocated into new space,
McDonalds relocated to a stand alone store closer to 57t , and additional small retail spaces made
available throughout the site.
It is anticipated that construction could start as soon as this winter. I will keep you updated as things
progress.
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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