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HRA 09/09/2010 - 29808CITY OF FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY COMMISSION September 9, 2010 CALL TO ORDER: Chairperson Commers called the Housing and Redevelopment Authority meeting to order at 7:04 p.m. ROLL CALL: Members Present: Larry Commers William Holm John Meyer Pat Gabel Stephen Eggert Member Absent: John Meyer Others Present: Paul Bolin, HRA Assistant Executive Director ACTION ITEMS 1. Approval of Expenditures Chairperson Commers asked in the reimbursement column of the City, the large amount the Commission pays is listed. He asked if they could get a description of what the charges cover. Paul Bolin, HRA Assistant Executive Director, replied he would talk to the Finance Department. Commissioner Gabel asked what is the utility bill? It is only $6. Is it on University Avenue? Mr. Bolin replied they still have some minimum power on at the Select Products building. Commissioner Gabel stated, asked regarding the home demonstration, that must be just furniture rental for staging etc. for the house? Mr. Bolin replied, correct. MOTION by Commissioner Gabel, seconded by Commissioner Holm, to Approve the Expenditures. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 2. Approval of August 5, 2010, Meeting Minutes Commissioner Gabel referred to the third page, Item 4, "Tree Replacement on HRA Property" she thinks they should point out where it was at. Add an address or something. Chairperson Commers asked if they could add it at the end right before Mr. Bolin's recommendation, the Fridley City sign is on the corner of Fourmies Avenue and University Avenue Service Road. MOTION by Commissioner Holm, seconded by Commissioner Gabel, to approve the minutes. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 3. Approval of 2010 Tax Levy for Taxes Payable in 2011 Mr. Bolin stated State Statute authorizes housing redevelopment authorities to levy properties within their community to support housing and redevelopment efforts. The levy is equal to .0185 percent of a property's taxable market value. The 2011 levy as proposed will allow the HRA to collect approximately $473,000 for its ongoing efforts. This is a decrease from 2010. In 2010 the HRA collected $498,000. The reason for that decrease is that the overall market value has decreased by over $137,000,000. Mr. Bolin stated as to the impact that this levy has on the Fridley taxpayer, if you own a $150,000 home, it will be $27.75 for the year 2011. If you own a$1 million commercial property, you would pay $185 towards this. Staff does recommend approval of the resolution consenting to an HRA tax levy. It does provide the HRA the ability to fund its ongoing and future redevelopment efforts. Chairperson Commers asked now as long as they have made an assessment, under the lawsuit that was brought against the County, is it not true the County HRA will not be able to levy a second assessment? Mr. Bolin replied, that is correct. MOTION by Commissioner Holm, seconded by Commissioner Gabel, approving the 2010 Tax Levy for Taxes Payable in 2011. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 4. Approval of Continuation of Home Remodeling Demonstration Program Mr. Bolin stated despite all of that negative news that is out there, all the measures indicate the remodeling program they have been doing has had an impact in Fridley. They had over 2,000 2 people (majority being Fridley residents) who went through the house once it was finished. Looking at building permit records, specifically looking at remodels from April through the end of August 2009 vs. April through the end of August 2010, they were actually up. It was 15 remodels vs. 12 remodels in 2009. Mr. Bolin stated looking at their loan numbers through the end of August, this year they have closed lO loans. Last year they were at 8. Over the months they have been doing this program, they have been seeing more applications. With all the credit being tightened up, he does not think their approval rate has been as high as it has been in the past. Mr. Bolin stated Shaun Lennox, the builder they worked with on this, has met with a couple dozen Fridley residents. If he was not available to do that, the HRA may have also seen an increase in its Remodeling Advisor visits. Mr. Bolin stated he thinks they are going to see the effects of this project over the next several months. They have given people a lot of different ideas and a lot of things to think about. One of the first questions people asked when they came through the house was, "When are you going to do another house?" Mr. Bolin stated they would also like to put a couple of twists on what they have already done. One would be to showcase improvements to make a split-level home more livable and the other would be what they would like to call "one-level living" options that would allow residents to age in place. Mr. Bolin stated he feels they have a good team in place and would like to continue on with Lennox Builders and with the realtor, Tim Van Auken. Now staff would rather work with them in selecting the houses. By doing so the HRA would end up with a house that Lennox Builders can upgrade to the point where it needs to be without pricing the home out of the market. Mr. Bolin stated another twist is that these properties the HRA acquires for this could be put into the HRA's scattered site housing replacement program. The way that is set up, it just needs to be an improvement to the home, and bring the home back up towards market value. A remodel definitely qualifies and would also allow the HRA to collect some increment for 15 years. Mr. Bolin stated staff recommends the HRA approve two motions authorizing staff to continue with the home improvement program for up to two more homes. Also, staff would like the HRA to authorize them to work with Lennox Builders and Tim Van Auken of Counselor Realty on the project. Finally, for the HRA to authorize staff and the Board chair or vice chair to execute any necessary purchase agreements that come up as staff is out trying to acquire properties. Commissioner Gabel stated she is very much in favor of moving forward with this. She thinks the ideas Mr. Bolin came up with are good ones. Commissioner Eggert stated his reaction is he thinks Mr. Bolin is trying to assemble a small team that can move quickly and appropriately in the market that has been a little confusing at times and to be able to react to those opportunities quickly. On the construction side that would be a tremendous help to be able to move quickly. Commissioner Holm stated he agrees and he liked Mr. Bolin's idea that he mentioned about a green house. Particularly focusing on energy efficiency. He thinks that would be a great way to continue on with this program. He is fully supportive. Chairperson Commers stated they certainly did do a wonderful job on the Mississippi property, and they are all certainly supportive of trying to move ahead in getting these next couple of properties. MOTION by Commissioner Gabel approving the continuation of the Home Remodeling Demonstration Program. Seconded by Commissioner Holm. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. INFORMATIONAL ITEMS 1. Housing Replacement Program Mr. Bolin stated by the October meeting they should have closed on the property on 2'/z Street currently owned by Bremer Bank. Commissioner Eggert stated the house will go away. How is staff setting up that site for the next developer? Mr. Bolin replied, because of the condition of this home, once they have control of it, he would like to come back at the October meeting with a resolution to have it added to the Housing Replacement Program. The HRA needs to do that once they take control of it and before they demolish the home. He would like to come back in October and get authorization to go ahead and take that home down. Mr. Bolin stated he is hoping to close on the home on Fairmont. That is another one that is on a slab, but it is completely full of mold as is the garage. Ideally he will have two properties to come back at the October meeting, get them into the program, and get those down this fall. If they go out with bids to take down the two homes, that will save them money as well, rather just having a single home demolished. Commissioner Holm asked, and is there a replacement build or is that not possible? Mr. Bolin replied, that is a buildable lot. Chairperson Commers asked regarding the third property mentioned, Brookview Drive. � Mr. Bolin stated he has been through it and, now that the Commission has given them some approval to move forward with the program, they are going to go back and go through it again with Lennox Builders for their opinion on doing something with that one. Fannie Mae owns that property. 2. Housing Loan Program Update Mr. Bolin stated they did close on one of their revolving loans in August. That brings them to a year-to-date total of 10. Last year at this time they were at 8. Looking at the Remodeling Advisor visits, the year-to-date total is 8. He thinks last year at this time they were at 11. He thinks part of the reason the visits have not gone up along with everything else is because when people came through the home, the person who actually did the work on our particular home happens to be there and they end up talking with him and getting a number of ideas. Chairperson Commers asked, so they sent out 29 loan applications, processed 15, and closed on 10? Mr. Bolin stated, yes, and the 29 sent out is simply the number the Center for Energy and Environment sent out. They handed out close to 125 loan applications at their last weekend series of open houses. There has been even more handed out than those numbers suggest. 3. Northstar Chairperson Commers stated he assumes this is going along reasonably well. Northstar did do some passenger checks to see who is getting on and off, did it not? Mr. Bolin replied, they did, and they are still promising to meet with Dr. Burns and him. They keep postponing the meeting. The City has been continuing to get Northstar's more generic monthly updates. All the numbers keep increasing every month. 4. The Waters of Fridley Mr. Bolin stated Trident has met again with their financing people, and they have actually gone ahead and started working on their engineering plans. Their plan is still to apply for permits this fall and start construction before the first of the year. They had changed the name to "Land Mard." 5. Cub Foods Redevelopment Mr. Bolin stated the City liquor store is close now to finalizing a new lease for the new space. There has been some serious interest from one of the largest hotel groups in the country. This was a meeting actually with representatives of the group that owns Holiday Inn, Crown Plaza, and a number of other hotels. Commissioner Gabel asked is there enough room there? E Mr. Bolin replied, there is some green space parking area beyond the southwest corner of this site. That was the area where the group from Chicago who owns this center, designated that area in their master plan for a future hotel site or a future stand-alone retail. There would be some challenges there, such as the grade difference between Main Street. However, he thinks there probably is a way to do it. Chairperson Commers stated they should have an old file on the hotel deal. They did surveys and other things. They went to Medtronics to see what they would be willing to do, etc. The HRA should have that to refresh their minds about what was said back at that time and why the proj ects did not go then. Mr. Bolin stated he was in the Planning Department back when those studies were done. They did them jointly with the City of Columbia Heights. They had Dick Paik, consult from Boston come in, and they were looking at spin-off developments from large corporations such as Medtronic. The biggest thing that came out of that study in regards to hotels was the fact that Medtronic was telling them was that the people they were bringing in would want more amenities than what was currently available in Fridley. Commissioner Eggert asked if a hotel ends up there, would he be able to easily get from the hotel to the train station? Mr. Bolin replied, yes. They just had a meeting on Tuesday again looking at transit-oriented development and the Overlay District they are working on. A big piece of that would be some sort of multi-use walking/biking trail that would go on Main Street and would make the connection between the rail site and the development there on 57th and the Home Depot and sort of everything else down there as well. 4. Faulkner Senior Assisted Living Mr. Bolin stated they thought they would not hit water until they were down about 13 feet, and they ended up finding water at about 8 feet so that held them up a little bit. They had to do some dewatering and the City had a pipe that went through the site and so they had to move that; but they have most of the footings installed and they are going as quickly as they can down there. When Mr. Bolin talked to Mr. Faulkner about a week and one-half ago, he still thinks they are going to be ready to open January 1. 5. Sikh Society Property Mr. Bolin mentioned they did close on the Sikh Society property late last week. Commissioner Eggert asked, the title got figured out? Mr. Bolin replied, yes, they ended up getting the title from McDonald's and rather than take any chances, staff had the folks that it works with at Land Title take it up to the County and get everything filed. The Sikh Society may need to look at extending their lease a couple of months. They are going to do everything they can to get out of there by the first of the year and get into 0 their new building. However, they did ask if they run into some problems and they cannot get into their new building by the end of the year, they would actually like to stay in this building until he thought it was the 15th of April. That coincides with some holiday that the Sikhs have. There is a clause in the lease agreement allowing the Commission as a Board to extend their lease as long as they do it before the end of December. Mr. Bolin encouraged them to get out by January 1 but, if it looks like that is not going to work, they will come back to the Commission before the December meeting and if the Commission so chooses they can grant them an extension. Chairperson Commers replied, they should not have any problem working with them. It is better to have it occupied in the winter anyways. ADJOURNMENT: MOTION by Commissioner Eggert to adjourn. Seconded by Commissioner Holm. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MEETING ADJOURNED AT 7:55 P.M. Respectfully submitted, Denise M. Johnson Recording Secretary 7