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HRA 07/08/1993 - 29563,� CI'1eY OF FRIDLEY HOIIBING & REDEVELOPMENT AIITHORITY MEETING� JIILY 8� 1993 __________________.,_____________________________----------------- CALL TO ORDER: Chairperson Commers called the July 8, 1993, Housing and Redevelopment Authority meeting to order at 7:30 p.m. ROLL CALL• Members Present: Larry Commers, Virginia Schnabel, John Meyer, Duane Prairie, Jim McFarland Members Absent: None Others Present: William Burns, Director of HRA Barbara D�cy, Community Development Director Grant Fernelius, Housing Coordinator Paul Hansen, Staff Accountant Jim Casserly, Consultant Chuck Tuchfarber, NuSports Systems, Inc. Pat Pelstring, Business Development Services Arland Breyer, Cinnamon Skins Terrie Mau, Cinnamon Skins ^ APPROVAL OF MAY 20. 1993. HOUSING & REDEVELOPMENT AUTHORITY MINUTES• MOTION by Mr. McFarland, seconded by Mr. Prairie, to approve the May 20, 1993, Housing & Redevelopment Authority minutes as written. IIPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLAR�D THE MOTION CARRIED IINANIMOIIBLY. 1. MEMO ON REQUEST FOR ASSISTANCE FOR SPORTS SPREE IN MOORE LAKE COMMONS: Ms. Dacy stated Sports Spr�e is an indoor family entertainment center which is proposed to be located in the former Country Club Market tenant space in Moore Lake Commons Shopping Center located on the east side of Highway 65 and north of East Moore Lake Drive. The total project cost to locate Sports Spree in that tenant space is $900,000. Ms. Dacy stated that in the correspondence dated July 2, 1993, the petitioner, NuSports, has obtained commitments from private investors and a bank loan leaving a gap of $80,000. The petitioner is requesting a$50,000 loan from the HRA, and the remaining $30,000 would be raised from private investors. The proposed term � �"1 80II8INa & REDEPELOPMLNT AIITHORITY MTa.. JIILY 8, 1993 PAa$ 2 of the loan suggested by the petitioner is ten years at an interest rate 7.5�. Ms. Dacy stated the staff is pleased to have this use in the Moore Lake Commons area. There is no question that this entertainment center would add to the vitality of that project area. Staff also understands that this location is the first of four anticipated Sports Spree facilities in the metro area. However, in the past the HRA has not developed a policy to assist commercial leasehold tenants. Previous assistance policies have been developed for free-standing buildings and users only. Also, on several occasions, the HRA has indicated to staff that funds should be prioritized for housing programs, redevelopment priorities such the Lake Pointe site and southwest quadrant at Mississippi Street and University Avenue, and for industrial business expansion and retention. Ms. Dacy stated that if the HRA decides to proceed with the loan, staff would like to point out the following issues: 1. Although the proposed location is in the redevelopment project area, it is not in the tax increment district; therefore, there is not the backup�for capturing the increment from the added improvements to the building. '� 2. The loan has to be secured by the ownership of Sports Spree. (If the HRA did execute the loan, the interest earnings based on 7.5� over ten years �aould be $21,960.10.) Ms. Dacy stated that Pat Pelstring, President of Business Development Services, Inc., and representing Sports Spree, and the President of Sports Spree, Chuck Tuchfarber, are at the meeting. Mr. Pat Pelstring stated that this is somewhat of a unique project. They believe Sports Spree is the type of developer the City of Fridley is looking for in its commercial areas and which will promote additional commercial growth in this area. It promotes a family healthy recreational alternative for children and adolescents, ages 8-20, and their parents. It is an alcohol-free and smoke-free center. Sports Spree would also provide employment opportunities for young people. Mr. Pelstring stated this facility will be the first prototype center in the Twin Cities area. An additional 2-3 facilities are planned for the Twin Cities area. The Fridley facility will also be the operations headquarters for the company which will add 3-5 employees initially. Mr. Pelstring stated this is a new business, and they are well � aware that it is very difficult to secure bank participation in a new business venture. They believe the bank's participation, r"� 80IISING & REDEVELOPMENT AIIT80RITY MTd.. JIILY 8. 1993 PAaE 3 though not as much as they would have liked, indicates the bank's endorsement support for this project. But, the difficulty in raising the significant level of equity for the center has made it difficult to complete the financing. They are asking the HR�,'s consideration for this very unique project. Mr. Chuck Tuchfarber handed out copies of the press release announcing the project. He stated they believe the Sports Spree facility offers at least three benefits to the City of Fridley in bringing forth additional funds to this project: 1. It will revitalize the Moore Lake Commons Shopping Center. 2. They will be employing approximately 20 people, many of whom will be young people within the community. This will be the operations center for the Twin Cities area. 3. This will be a nice addition to the social fabric in Fridley. Mr. Tuchfarber stated the Sports Spree Fun Center generically is considered an indoor family entertainment center. The thing that drives the product is the multitude of activities available 365 ^ days a year. It is broken down into eight different groupings of � activities within approximately 24,000 square feet of area. They plan to have 18 holes of miniature golf, fast pitch and softball batting cages for all age groups, a bumper car area, a soft play area and climbing system for the younger children, a micro basketball court, a number of party rooms, a video arcade area, and a non-alcoholic sports bar. Included in the sports bar is the Bridgeman's Soda Fountain. The prices range from 25 cents to $2.50 so it is very affordable to people in the community. Mr. Tuchfarber stated the Sports Spree facility is designed for children and parents to participate in activities on a pay-as-you- play basis. To his knowledge, there is nothing like this in the Fridley area, or a facility as complete as this in the northern suburbs, so it will be a very nice addition to the Fridley community. Mr. Tuchfarber stated they have a number of substantial investors who have put in a substantial amount of monies. The problem is that this is a start-up company, and they are struggling to fill in the gap. That is the reason for their request for a$50,000 ten year loan. Mr. Pelstring stated they are not asking for a grant or tax increment assistance but a market rate loan. They are also not asking for any direct incentives or inducements. It will be a loan � well secured to the HRA's satisfaction. They recognize this is a � HOIIBING� & REDTVELOPMENT AIIT80RITY MTG.. JIILY 8. 1993 PAaE 4 unique request, but this is a unique project with a lot of benefits. Ms. Schnabel asked the maximum amount of people who can be served in the facility at one time. Mr. Tuchfarber stated they can serve around 300 people at one time. On a busy Saturday or Sunday, they would anticipate about 1, 000 family members using the facility. Conservatively, they believe they will serve 120, 000 people on an annual basis which will be very good for revitalizing the Moore Lakes Common Shopping Center. They believe it will pull from about a 10 mile radius. Mr. Prairie asked the seating capacity for the restaurant. Mr. Tuchfarber stated there are two areas in the restaurant, a closed-off area which will serve around 60-70 people, and the main sports bar area which will serve another 60 people, so the total is about 120. They have some expansion room on the lower level that can accommodate another 40 people. Ms. Schnabel asked if there are any similar facilities in the Twin Cities area. � Mr. Tuchfarber stated there is a facility in Eagan called Grand Slam, which has been in operation about 2 1/2 years and has been very successful. That particular facility pulls from a 30 minute driving radius. Mr. Commers asking the timing for this request. Mr. Tuchfarber stated that they would like to get some indication from the HRA within the next 30 days. They would like to open the facility in September. They have actually started the demolition, but are holding any additional construction until all the funding is in place. Mr. Commers stated that with other projects the HRA has assisted, they have either had tax increment behind them or some security in real estate. They have not done anything quite so straight-forward regarding tenant improvements or something of that nature. He did not know if the improvements are necessarily reflected in the value of the building. Even so, the project is not in the tax increment district, and the HRA cannot capture any revenues to offset the risk of the loan. What the HRA members have to decide is whether or not this is the type of project they would like to consider. Mr. Meyer stated this venture does not own the building. It is a tenant and there are $950,000 for leasehold improvements so the HRA really has no collateral for its loan. � � 80IISIN(3 & REDEVELOPMENT AIITHORITY MTt3., JIILY 8, 1993 PAGE 5 Mr. Pelstring stated he can understand the HRA's concern regarding the loan and that the HRA gets a secure investment. They would be happy to meet with staff to work out something that would give the HRA some comfort. They do recognize that this site is not in a tax increment district. That is why they are not asking for a 3� interest rate or a grant. They are just trying to fill a gap in the market rate and give the HRA a reasonable security level. He believed these are issues they can work out to the HRA's satisfaction. Mr. Meyer stated it seems like they are going into the "loan without collateral" business and getting into a leasehold improvement situation which is noticeably different from normal HRA activities in terms of advancing public monies. He can understand the potential benefits to the Moore Lake Commons Shopping Center and the City, but it would obviously create a demand on the HRA's resources for other types of similar ventures in the City because they would have breached a certain activity beyond which they have not gone before. Ignoring the merits of this particular case, does the HRA want to get into this extended venture? Mr. Commers stated the issue before the HRA is whether or not the HRA has any interest in this kind of a transaction. If they do, ^ then there can be further discussions. But, it does bring up policy issues which make this decision even more difficult. Ms. Schnabel stated she agreed with Mr. Meyer. The HRA recently analyzed how they wanted to allocate funds and where they wanted those funds directed. This proposal is outside that area. If the loan was for a shorter period of time, she might be a little happier with the request. Even though this request is not for a large amount of money, it might be significant in terms of timing on their other projects. What bothers her the most is that this is deviating from the plan the HRA recently reviewed and established. Mr. Meyer stated they have bitten off quite a chunk of new activity with the housing rehab area. Mr. Commers stated the other side of it is that the Moore Lake Shopping Center is not doing well, and i� would be nice to get the Moore Lake Shopping Center up and going again. That corner is highly visible. Ms. Schnabel stated she agreed that this is an exciting project, and she is supportive of the project. She is just reluctant to open a new door for funding that the HRA has not done before in light of the fact that the HRA recently made some very significant decisions on the things they want to support. ,� /"� HOUBING & RIyDEVELOPIMBNT AIIT80RITY MTG., JIILY 8, 1993 PAGE 6 Mr. Prairie asked if there is any other way of helping out the project in terms of funding, or is this the only proposal? Mr. Burns stated he did not believe there is another source of funding other than tax increment funding. Mr. Meyer stated this is not the right time to be getting into the business of insuring loans. If they do get into the loan business with this venture, that means they would be op�ning the door for other ventures. Ms. Schnabel stated she supported Mr. Meyer's statement. The HRA has already made their commitments. Mr. Prairie agreed that this deviates from what the HRA has done in the past; however, it would be nice to have a viable business in the Moore Lake Shopping Center. Mr. McFarland stated he saw two things with this request. The first one is the risk, and the second one is whether the HRA wants this as a project. He believed the HRA will have to resolve the latter first. He would like to see something happen in that shopping center, but he is not sure if that is the HRA's function. � Mr. Commers agreed that the risk is a separate issue. MoTION by Mr. Meyer, seconded by Mr. Prairie, that, from a policy point of view, the HRA does not wish to be involved in the funding of tenant leasehold improvements as part of an overall development proj ect . IIPON A VOICE VOTE, COMMERS, 3CHNABEL� MEYER� MCFARLAND VOTING AYE, PRAIRIE VOTING NAY, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED BY A VOTE OF 4-1. Mr. Commers stated that this was a very difficult decision. He stated the HRA is very impressed with this project itself. Part of the problem is the bad timing as the HRA recently spent many hours developing priorities, putting together a program, and allocating their resources. He did not think the HRA members are against some kind of assistance if there is some other method of doing it. He encouraged the Sports Spree people to continue to talk to City staff and Jim Casserly to see if there are any alternatives, but the HRA just is not in a position to honor the current request. Mr. Pelstring stated he understood the HRA's concerns. He sta�ed he would like to continue discussions with staff. There are some distinctive things about their project that can, from a policy standpoint, set it apart from any other retailer that might come �� in for assistance for different reasons. He would like to address that issue first and that might help guide further discussions. HOIIBINa & REDEVELOPMENT AIITHORITY MTa.. JIILY 8, 1993 PAGE 7 � In terms of the way the request was structured, he has some ideas that might make some sense. Mr. Commers wished them luck. 2. CONSIDER RESOLUTIOld REGARDING HOME IMPROVEMENT LOAN PROGRAM: Mr. Fernelius stated there are four items on the agenda related to the housing rehab program. Before getting into each resolution, he would like to review each of the individual programs, highlighting the features of each program. He stated he had prepared a summary sheet on the Home Improvement Grant Program, the Home Improvement Loan Program, the Home Mortgage Assistance Program, and the Rental Rehabilitation Loan Program. He reviewed each of these programs with the HRA. Ms. Schnabel stated that wi,th the Home Improvement Grant Program, she is concerned that the program will not be available to enough people or to a limited number of people because the gross income is too low. Mr. Fernelius stated the City is in the process of receiving applications. Out of 170 applications sent out, he has received about 30 completed applications. About half of those are for the ,,� grant program. Based on�the verification submitted, these people would qualify for the program so there is a demand out there. These limits are established by Anoka County for the county-wide program, and there are waiting lists in other parts of the County. Ms. Dacy stated that at the August meeting, she will bring in the census data indicating the gross household incomes. Mr. Fernelius stated he had included a brief overview of the application process. They are currently accepting pre-screening applications. If all goes well, starting July 19 through the end of July, he will go through the applications for the single family programs and, using the criteria that has been established, score each of these applications. At that time, those with the highest scores will be given the opportunity to receive funding. During the first of August, staff hopes to conduct a property inspection to find out what type of code deficiencies exist so those minimum items are included in the applicant's financing package. Once the inspections are completed, the applicants will be given 30 days to approach the lender in the case of the two loan programs for single family in which to make an application. For the grant program, the City will be working in cooperation with ACCAP to jointly administer that program. The applicants for the grant program will be directed to ACCAP for additional processing. Mr. Meyer stated he is concerned that code violations are taken �, care of with these programs. Does the owner create the list of improvements he/she wants done? HOIIBINa & REDEVELOPMENT AIITHORITY pITG., JIILY 8, 1993 PAGE 8 � Mr. Fernelius stated the contract inspector will generate that list. As part of the application process, before HRA funds are committed, staff has the opportunity to review the primary loan application to make sure those improvements are included. It has always been his understanding that in order for the HRA dollars to be involved, the minimum code violation improvements have to be included in the application. Ms. Dacy stated that the minimum code improvements are still top priority. Mr. Fernelius stated that some of the documents that are attached to the resolutions will need to be slightly revised, but there are no policy changes or changes in program design. Any changes of that nature would be brought back to the HRA. Mr. Casserly stated all three resolutions for the housing rehab programs are essentially the same in format. The design by these resolutions is to have the HRA adopt the general policies for each program. Attached to each resolution is a brief description of each program. What is significant about that is the HRA is setting the income limits for each program. The HRA is also approving the form of the documents and authorizing staff to carry whatever � actions are necessary to implement these policies and give effect to the programs. Mr. Casserly stated each resolution has specific documents attached to it; and, by approving the resolutions, the HRA is also authorizing the Executive Director and Chairperson to execute those documents. Mr. Casserly stated that, as Mr. Fernelius stated earlier, staff is still in the process of doing some refining on a couple of features in those documents, but the concept, program description, and essential format are all contained in the present documents. Mr. Commers stated that as a supplement to this, he would�like staff to develop some type of monthly reporting process back to the HRA, at least initially, on the number, type, and specific characteristics of each program. This will keep the HRA updated on what is taking place on an monthly basis. MOTION by Ms. Schnabel, seconded by Mr. McFarland, to approve Resolution No. HRA 3-1993, "A Resolution Establishing a Home Improvement Loan Program; Establishing the Area of Operation; Providing for the Delegation of Certain Powers and Duties; Authorizing the Execution of a Memorandum of Understanding by and between the Housing and Redevelopment Authority in and for the City of Fridley and the Fridley State Bank". � HOIISING & REDEVELOPMENT AIITHORITY MTG.. JIILY 8. 1993 PAG$ 9 � IIPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERBON CONII�iERB DECLARED THE MOTION CARRIED IINANIMOIIBLY. 3. COATSIDER RESOLUTION REGARDING HOME MORTGAGE ASSISTANCE PROGRAM: MOTION by Mr. McFarland, seconded by Ms. Schnabel, to approve Resolution No. HRA 4-1993, "A Resolution Establishing a Home Mortgage Assistance Program; Establishing the Area of Operation; Providing for the Delegation of Certain Powers and Duties; Authorizing the Execution of a Mortgage Origination Agreement by and between the Housing and Redevelopment Authority in and for the City of Fridley and United Mortgage Corporation". IIPON A VOICE VOTB, ALL VOTINC� AYE, CBAIRPER80N COMMERS DECLARED THE MOTION CARRIED ONANIMOIISLY. 4. CONSIDER RESOLUTION REGARDING RENTAL REHABILITATION LOAN PROGRAM: MOTION by Mr. Prairie, seconded by Ms. Schnabel, to approve Resolution No. HRA 5-1993, '�A Resolution Establishing a Rental Rehabilitation Loan Program; Establishing the Area of Operation; Providing for the Delegation of Certain Powers and Duties; � Authorizinq the Execution of a Memorandum of Understanding by and � between the Housing and Redevelopment Authority in and for the City of Fridley and the Fridley State Bank; Authorizing Execution of an Administration Contract with the Minnesota Housing Finance Agency". IIPON A VOICE VOTE, ALL VOTIN(3 AYE, CBAIRPER80N COMMERS DECLARED THE MOTION CARRIED IINANIMOIISLY. 5. CONSIDER RESOLUTION REGARDING CONTRACT INSPECTORS FOR HOUSING REHABILITATION PROGRAMS: Mr. Commers stated he has some concerns about the inspection report in that he thought it was too general and not specific enough in the items to be inspected. He suggested staff look at the Metro HRA inspection report which seems to be a more specific checklist. Mr. Fernelius stated staff wanted to keep in mind the cost of each inspection in terms of how much time it would take to complete a very lengthy inspection form. He generated the inspection report, combining other inspection reports he had received. He is certainly willing to revise this inspection form to make it more specific regarding what items are to be covered during an inspection. However, if they get a report that is very lengthy, they may be creating a document that is going to take a lot of time to complete, and they may not find inspectors who are willing to do that kind of inspection for the price budgeted. � � � HOIIBINa & REDEVELOPMENT AIITHORITY MTG., JIILY 8. 1993 PAGE 10 Mr. Fernelius stated he also wanted a user-friendly document so that a copy of the inspection report could be given to the homeowner that the homeowner could understand and which would help eliminate a lot of extra paperwork. Mr. Commers stated he believed the Metro HRA inspection report is user-friendly in that it is all printed out and the inspector only has to check whether a particular item passes or fails. There is place at the bottom of the report for comments. With this type of report, the City knows that the inspector has looked at each one of the items listed. Mr. Commers stated he would like staff to consider looking at the inspection report to make it a little more specific and not so wide open. Mr. Fernelius state he is certainly willing to make modifications to the inspection report to make it more detailed. MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve Resolution No. HRA 6-1993, "A Resolution Authorizing Execution of a Contract for Housing Rehabilitation Inspection Services" and to adopt in general form the attached contract. IIPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COI�IERB DECLARED THE MOTION CARRIED IINANIMOIIBLY. 6. RESOLUTION ADOPTIIJG ICP7A RETIREMENT CORPORA.TION AS THE DEFERRED COMPENSATION PLAN PROVIDER FOR THE FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY: Ms. Dacy stated this is an item that needs to be adopted because the HRA has hired Mr. Fernelius. Mr. Hansen stated that approving this resolution gives Mr. Fernelius the retirement option that all City of Fridley employees have. MOTIOPi by Ms. Schnabel, seconded by Mr. Prairie, to approve Resolution No. HRA 7-1993, "Resolution Adopting ICMA Retirement Corporation as the Deferred Compensation Plan Provider for the Fridley Housing and Redevelopment Authority". IIPON A VOICE VOTE� ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED IINANIMOIISLY. 7. CLAIMS AND EXPENSES: Mr. Hansen added two checks to the check register, one to Isaacson Lawn Care Service, Lake Pointe Maintenance Estimate �"� #3, in the amount of $3,924.27; and NSP in the amount of $43.86. HOIISIN(3 & REDEVELOPMENT AIITHORITY MTG.. JIILY 8, 1993 PA(3L 11 � OTION by Mr. Prairie, seconded by Ms. Schnabel, to approve the claims and expenses and the issuance of checks, nuinbers 2343 - 2382. IIPON A VOICB VOTE, ALL VOTING AYE, CHAIAPERSON COMMERS DECLARED THE MOTION CARRIED IINANIMOIISI,Y. 8. DISCUSS STATUS OF RICE PLAZA: Ms. Dacy stated the HRA acquired the Rice Plaza property in 1990. In 1991, the shopping center was at full occupancy, and it had an operating surplus of $47,000. In 1992, three of the eight tenants left, and revenues dropped to $8,888. If the current four tenants remain until the end of 1993, the projected balance is a deficit of $8,130. These cash flow numbers do not include any type of amortization for the original acquisition price. Ms. Dacy stated Cinnamon Skins has a lease that extends until the end of December 1993. Hong Kong Kitchen's lease expires at the end of October 1993. The remaining two tenants are on a month-to-month basis. Ms. Dacy stated the HRA has received a letter from the owner of � Cinnamon Skins, Arland Breyer, requesting to break the lease, leaving the building on September l, so they can occupy another space in Fridley. Ms. Dacy stated staff has recommended to Mr. Breyer that the lease be extended until at least November 1, which �aould match the Hong Kong Kitchen lease and minimize the HRA's losses. Ms. Dacy stated that staff has heard by word of mouth that another tenant, My Sister's Closet, is also looking for another tenant space. No matter what action the HRA takes in terms of the Cinnamon Skins lease, the shopping center could be down to two tenants for the last two months of the year. If that is the case, staff recommends that the HRA authorize demolition in the last two months of 1993. After the HRA's action at this meeting, staff will tell Jim Kordiak to notify the tenants as soon as possible so that they can begin looking for other locations. Ms. Dacy stated that at the May 20, 1993, meeting, the HRA authorized staff to proceed with a$5,000 driveway improvement to the rear of the building because of some traffic conflicts with Dairy Queen and the other tenants. However, if the HRA recommends demolition, then it is not necessary to make this driveway improvement. Ms. Dacy stated that in March of 1992, Darrel Clark, the former Chief Building Official, obtained a demolition estimate of $25,000 HOIISINa & REDEVELOPMENT AIITSORITY MTG.. JIILY 8, 1993 PAG� 12 � to remove the building. Staff believes that number is still accurate. Ms. Terrie Mau, Cinnamon Skins, stated she is representing Arland Breyer's interest in this property. She stated they have found a new location within Fridley which is available now, and they would like to move their business to this new location. Finding property available is Fridley is very difficult because of the type of business they have. They have to stay in close proximity to their current location in order to preserve their customer base. She stated they had hoped that they would be able to move to the new development on the old 10,000 Auto Parts site, but that doesn't doesn�t appear to be happening. Their new site (in the old Cost Cutters' tenant space on ,53rd Avenue) has been vacant for some time, and the owner is anxious for them to move in on August 1. With the new rent ad the fact that this is a slow time for their business, they cannot foresee paying rent for two locations for three months. They are requesting that the HRA release Cinnamon Skins from their lease as of September 1, 1993, which is only two months prior to the lease expiring on November 1. Ms. Mau stated that the road construction and the Dairy Queen's drivethrough have caused irreparable damage to their current location. During the Dairy Queen's busy hours, from 6:00 to 9:00 „� p:m., which is also a busy time for Cinnamon Skins, the parking � situation has been very difficult for their customers. Ms. Mau stated they are in a very difficult spot, business-wise, and they are hoping to continue their business in Fridley and are motivated to stay in Fridley. Mr. Meyer stated he believed this is a reasonable request. Mr. Commers stated he agreed with Ms. Mau that with the construction, things are really a mess at the Rice Plaza shopping center. Mr. McFarland stated he is in favor of releasing Cinnamon Skins from their lease. MOTION by Mr. Meyer, seconded by Mr. McFarland, to honor the request by Cinnamon Skins to terminate the lease as of August 31, 1993. IIPON A VOICE VOTE� ALL VOTING AYE� CHAIRPER80N COMMERS DECLARED THE MOTiON CARRIED IINANIMOIISLY. MOTION by Mr. McFarland, seconded by Mr. Prairie, to instruct Jim Kordiak to give the other tenants notice of demolition and to release Hong Kong Kitchen from their lease. �"1 /"� HOIIBING � REDEVELOPMLNT AIIT80RITY MTG., JIILY 8. 1993 PAGE 13 IIPON A VOICE VOTL, ALL VOTING AYE, CHAIRPER80N COMMERS DECLARED THE MOTION CARRIED IINANIMOIISLY. It was the consensus of the HRA to not make the driveway improve- ment to the rear of the building. 9. MEMO ON MiJLTI-TECH SYSTEMS INTEREST IN LARE POINTE SITE: Ms. Dacy stated John Ryden from CB Commercial has expressed an interest by Multi-Tech Systems to relocate its headquarters from the Moundsview Business Park to approximately ten acres of the Lake Pointe site. Multi-Tech would build a one-story, 70,000 square foot building, with a portion of it as a two-story office complex. Multi-Tech is looking for a high tech image site rather than the typical manufacturing-warehouse industrial park appearance. Ms. Dacy stated she has told Mr. Ryden that she did not believe this proposal is consistent with the vision the �iRA and City Council have for the Lake Pointe property. If the HRA feels differently about this proposal, they should let staff know. Mr. Commers stated the HRA and City Council spent a whole day on May 8, 1993, discussing their vision for Lake Pointe. He agreed with staff that this is not the type of project the City is looking � for. The HRA members agreed with Ms. Dacy and Mr. Commers. 10. MEMO ON STATUS OF ALL TEMP EXPANSION PROJECT: Ms. Dacy stated this is regarding the request by All Temp for �tax increment financing assistance for expansion of the existing All Temp facility at 5400 Main Street. At this time, staff is just waiting to see if All Temp is going to proceed with the project and tax increment financing assistance request. 11. OTHER BUSINESS: a. Tax Increment Financing Request from Victor Rosenblum Ms. Dacy stated Victor Rosenblum owns a company in St. Paul called Cooperative Plating, Inc. He would like to build a second facility on a site in the Great Northern Industrial Center. The new business will be called ECO Finishing, Inc. The estimated project cost is $2,250,000, and they are requesting $125,000 in tax increment financing assistance. The new company will immediately create 30 new jobs with the possibility of 80 jobs in the next five years. The initial phase to build a 29,000 square foot office and industrial complex. � � � ,� 80IISING & REDEVELOPMENT AIITHORITY MTG.. JIILY 8, 1993 PAGE 14 Ms. Dacy stated staff received this information late last week, and they have not had an opportunity to review the information in detail with Mr. Rosenblum. Mr. Casserly has briefly reviewed the information and found that it meets the requirements of tax increment law and that the request can be reimbursed in 3 1/2 tax years. Ms. Dacy stated staff will be meeting with the petitioner. Mr. Burns will probably submit this information to the Council for informal discussion the latter part of July, and this request will probably be on the HRA's August 12, 1993, agenda. The HRA agreed to authorize staff to continue discussions with Mr. Rosenblum. b. Reuse of Property at 5720 Polk Street N.E. Ms. Dacy stated ACCAP is not interested in rehabilitating the existing structure at 5720 Polk Street and relocating it on the property because of the excessive cost. Therefore, staff is recommending that the City proceed to demolish the existing structure. The memo dated July 1, 1993, was included in the HRA packet to let the HRA know that this is a potential site for the scattered site acquisition program, option number two in the memo. c. Request for HRA Funding of Wetland Consultant Study Ms. Dacy stated that in the spring of 1993 during the preparation of the City's 1993 General Fund budget, staff determined that it was necessary to hire a consultant to inventory the City's wetlands. The consultant contract is necessary because of the passage of the Wetland Conservation Act of 1991 by the State Legislature. Ms. Dacy stated that request for proposals were mailed to six environmental consultants, and the lowest cost as submitted by Westwood Professional Services, Inc., and Peterson Environmental Consulting, Inc., for $7,990. Ms. Dacy stated that two-thirds of the contract cost, or $6,000, will be paid through the City's General Fund. It is requested that the HRA authorize up to $1,990 from the "Non- Program Studies" line item of the 1993 HRA budget. The HRA allocated $28,000 for non-programmed studies. The Wetland Conservation Act of 1991 requires that cities inventory where their wetland areas are and determine their public value, and the consultant study will do that. Staff believes some of these wetland areas are going to be located in tax increment districts. HOIISING & RI1DEVELOPMENT AIITHORITY MTG., JIILY 8, 1993 PAGE 15 � MOTION by Ms. Schnabel, seconded by Mr. McFarland, to authorize an expenditure not to exceed $1,990 to be used for a portion of the wetland consultant contract with Westwood Professional Services, Inc., and Peterson Environmental, Inc. IIPON A VOICE VOTE, ALL VOTING AYIy, CBAIRPERSON COMMERS DECLARED TSE MOTION CARRIED IINANIMOIISLY. ADJOURNMENT: MOTION by Mr. Prairie, seconded by Mr. Meyer, to adjourn the meeting. Upon a voice vote, all voting aye, Chairperson Commers declared the motion carried and the July 8, 1993, Housing and Redevelopment Authority meeting adjourned at 10:10 p.m. Res ectfully submitted, L e Saba Re ording Secretary �, ,�