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HRA 02/03/2000CITY OF FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY MEETING FEBRUARY 3, 2000 CALL TO ORDER: Chairperson Commers called the February 3, 2000, Housing and Redevelopment Authority meeting to order at 7:32 p.m. ROLL CALL: Members Present: Larry Commers, Virginia Schnabel, John Meyer Members Absent: Pat Gabel, Jim McFarland Others Present: Barbara Dacy, Community Development Director Bill Burns, Executive Director of HRA Grant Fernelius, Housing Coordinator Jim Casserly, Development Consultant Robert Gerloff, Architectural Consultant Dave King, CRR Mr. Commers stated the HRA members would like to offer their condolences to the family and friends of the former Mayor Bill Nee. He wanted to acknowledge the role that Mayor Nee played with the HRA. Mayor Nee asked Mr. Commers in 1976 to be Chairman and talked about reconstituting the HRA. He had many ideas and visions about what he wanted for Fridley and 25 years later a lot of those things have come to fruition. They will all miss him. Mr. Meyer stated that he remembered in the early days back to 1965 with the flood and the tornado. In the midst of the City's turmoil, Mayor Nee pulled the City together physically and also found time to launch the HRA in 1965 and give it major guidance. Ms. Schnabel agreed with both Mr. Commers and Mr. Meyer. Mayor Nee had visions for the City and always talked about improvements and projects with a great sense of humor and compassion. He was a wonderful man and will be sorely missed. APPROVAL OF THE DECEMBER 9, 1999, HOUSING AND REDEVELOPMENT AUTHORITY MEETING MINUTES: MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve the December 9, 1999, Housing and Redevelopment Authority meeting minutes. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 2 CONSENT AGENDA: 1. RESOLUTION TO AMEND HRA BY-LAWS: Mr. Commers stated that he had some questions about the By-Laws and he would ask that this be removed and placed under Action Items for discussion. REMOVED RESOLUTION TO AMEND HRA BY-LAWS. 2. APPROVE KRASS MONROE CONTRACT: APPROVED KRASS MONROE CONTRACT. 3. AUTHORIZE APPLICATION TO MHFA FOR FIRST-TIME HOMEBUYER PROGRAM: Mr. Meyer stated that he would like this item removed from the Consent Agenda and placed under Action Items for discussion. REMOVED AUTHORIZATION FOR APPLICATION TO MHFA FOR FIRST-TIME HOMEBUYER PROGRAM. 4. RESOLUTION AUTHORIZING OFFICIAL DEPOSITORIES: ADOPTED RESOLUTION NO. HRA 01-2000. 5. CLAIMS AND EXPENSES: Ms. Schnabel stated that an additional expense was added that should be incorporated in Claims and Expenses. Mr. Commers thanked Ms. Schnabel for pointing that out. Julie Vogel, City Accountant, presented the additional expense. APPROVED CLAIMS AND EXPENSES AS CORRECTED. MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve the Consent Agenda as corrected. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. ACTION ITEMS: HOUSING & REDEVELOPMENT AUTHORITY MEETING, FEBRUARY 3, 2000 PAGE 3 6. AUTHORIZE PRINTING OF: "FRIDLEY HOUSING REPLACEMENT PROGRAM: A PATTERNBOOK FOR NEW HOMES": Mr. Fernelius stated they started this project in March 1999. The purpose of the book is to provide some design guidelines for new homes that are built on the in-fill Scattered Site program. The goals of the book were to encourage and inspire designs that were more compatible with the surrounding neighborhoods as well as offering ideas on ways of incorporating features and amenities that are demanded by today's homebuyers. Mr. Fernelius stated they wanted to avoid the cookie-cutter designs that had been built through the early stages of the program dating back to about 1995. Most of those plans were stock plans that builders were using and building pretty much out of speculation. Those plans tended to emphasize the garage prominent out in front of the house. There was no real public space in the front yard or back yard. At least 10 out of the 15 homes that were built out of the program were essentially the same design with the split entry with a two or three car garage. Mr. Fernelius stated that the objective of the plan book that was distributed to the HRA and made available to the general public addresses a number of areas. Site plan, zoning, setbacks, buildable areas, streetscape, and the front and back yard spaces are addressed. They are also trying to avoid the garage door dominance. Roof proportions, horizontal and vertical elements are looked at for rules of thumb for basic design elements. Architectural rules of thumb are also talked about which include the types and design of the windows, exterior materials, color use, and unique design features. All of these elements are laid out in the book in a really nice logical fashion. These were all put into three unique designs. Mr. Fernelius stated that they started with three plans that looked at the most common lot size in Fridley. The first design for a 60-foot lot is a two-story design that incorporates the garage being set back from the front farade of the house. There is a front porch and an interesting use of exterior materials. The design for a 75-foot lot has a story and a half design with the front porch. This design contemplates a detached garage but that could easily be brought forward closer to the house. It is a low profile design trying to match the surrounding landscape, which is predominantly ramblers. The last design resembles a number of rambler homes but also includes the attached garage feature set back from the front farade to create shadow effects. The floor plans provide features that get at what people are demanding in terms of larger gathering spaces in the house and utilizing kitchen space and great rooms. Mr. Fernelius stated they are using this as a marketing guide to people who are thinking about building in Fridley. Their hope is to meet with builders and realtors to unveil this concept in the spring. Staff is requesting approval for printing and binding, spending up to $2500 to cover those costs. Part of that cost is to be recovered through the Housing Replacement Program charging a non-refundable cost to help cover some of the costs in preparing and developing agreements. The cost of $25 per book will be included in that fee and will sell the book to the general public. Mr. Commers stated that it seems to be an outstanding project. HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 4 Mr. Meyer stated that he liked the book, but he believed some emphasis should have been placed on the use of the basement, whether it is a walk-out style or a nonwalk-out style. Many people devote the basement to dens or studies, and it is a very important part of the house. He is certainly in favor of going ahead with the book as it is, but a bit of an opportunity was missed in not including the basement plans. Ms. Schnabel asked Mr. Fernelius if there is a Fridley building code stating that you can have no more than a double car garage facing the street. Mr. Fernelius stated that there is not. The current code requires a double garage attached to the house. That is the minimum standard. Ms. Schnabel stated she read somewhere that you can have no more than a two-car garage door facing the street. Mr. Gerloff, architectural consultant, stated that it is a referral to try to have no more than two garage doors facing the streets. It does not mean that you do not have a third stall but it tries to limit the number of doors facing the street. Ms. Dacy stated that it is not a code requirement. Mr. Gerloff stated that it is not a code requirement but a rule of thumb. The intent is to try to minimize the garage scheme quality of the streets in Fridley. Ms. Dacy stated the story and a half is on a 75 foot wide lot with the detached garage and would require the zoning text amendment because the current zoning ordinance is written that the garage must be attached. There are a number of sites in the City with detached garages, and it would be worthwhile to pursue that amendment. Mr. Meyer asked if the breezeway between the garage and the house would count as being a connector. Ms. Dacy stated that there are certain footing and attachment issues that arise with the code if the breezeway is attached to the garage. If a breezeway has walls on both sides, it could satisfy the attachment requirement. Mr. Meyer stated that he assumes that if it has a roof and screens during the summer, it would comply. Mr. Commers stated that if the basement is finished, the houses would get quite large. Mr. Meyer stated that people might say that it is fine but is too much money. Ms. Schnabel stated it would be very interesting to see the developer's reaction and how much they follow this and how appreciative they are of all of the work that went into it. It is a very nice booklet with many useful guidelines. When there is a single lot in the middle of a neighborhood, the houses should blend in somewhat. HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 5 Mr. Meyer asked if another sheet could be added to explore basic uses of a basement suggesting all the requirements for a basement. Mr. Gerloff stated that basements are required. The attitude in the book is very much that the space down there could be developed; however, for the immediate project, they are focusing on space that particularly the older people may be using on a day to day basis. A basement could be easily developed in the future, and it is possible to add more information about the basement. Mr. Meyer asked if it could be done without upsetting some of their timelines for delivering the booklet. Mr. Gerloff stated that he does not know how soon it could be done. He would have to look at the schedule. Mr. Meyer stated that he believed the public would be interested in seeing the pros and cons of a basement. Ms. Dacy stated they would be happy to investigate the options. From a timing standpoint they would want to have it completed by March and it may not need another page. Mr. Commers stated that he would suggest that they table this until the next meeting on March 2. Ms. Dacy stated that they could e-mail the HRA the completed page to show them the text. Mr. Meyer stated that he does not feel he would need to read it. Mr. Commers stated he feels the HRA is confident that staff could work on it and have the HRA's authorization to go ahead and get the book printed and distributed. MOTION by Mr. Meyer, seconded by Ms. Schnabel, to authorize the printing of the "Patternbook for New Homes" with the additions or corrections after staff explores the options relating to basement commentary. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 7. CONSIDER INTEREST RATE WRITE-DOWN PROGRAM: Mr. Fernelius stated this is a proposal by Community Revitalization Resources (CRR). It is a division of Center for Energy and Environment. CRR is proposing to offer a program to the 15 suburban communities that participated in the Cape Cod and Rambler book that was printed last year. The goal is to encourage people to make improvements that are in the book by offering fairly attractive financing. The bulk of the HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 6 financing is provided by the MHFA, and the participating cities would share some of the funding through a mechanism called an interest rate breakdown. Mr. Fernelius stated MHFA has a program called the Community Fix-up Fund offering loans up to 8%. This program would offer those same loans at 6%, but would have to be subsidized by the cities. The maximum household income to qualify for this program is $73,143. This is established at 115% median income for the Twin City area. The maximum loan would be $35,OOO,and there would be some restrictions that it would be value-added type improvements to homes built before 1970. Mr. Fernelius stated that the City's role would be to help write down the interest rate from 8% to 6%. They would also be responsible to market the program to local residents. Each participating city would only be subsidizing loans within their own community. MHFA would also help match the interest subsidy. The advantage to this approach is that they are really leveraging their resources. They have the possibility of leveraging anywhere from ten to twenty times the dollars that they actually commit to the interest rate write-down program. There is also some reduced risk in cost associated with this approach, because MHFA actually has the note outstanding and would be paying the origination fee along, plus the ongoing servicing cost. It also preserves Fridley's resources which are very precious, given all the other redevelopment priorities that they are working on. It also serves an important market (middle income families) that they are trying to retain in Fridley. Mr. Fernelius stated CRR would make the loan directly to the borrower, and MHFA would buy the loan at a discount. This difference is the interest subsidy that the City and MHFA would split fifty-fifty. For example, on a$5,000 loan, the total interest subsidy is $500, and Fridley would be asked to pay for one-half that amount which is $250. This could potentially leverage up to 440 loans worth $2,200,000, assuming they had a$50,000 pool of funds set aside. If larger loans are made, they will have a higher interest subsidy, but the idea is that they are taking advantage of MHFA's resources. Mr. Fernelius stated Dave King from CRR is at the meeting, and he reported that out of 15 cities that participated in that book, six have agreed to commit to this idea: Blaine, Columbia Heights, St. Louis Park, New Hope, Robbinsdale, and Richfield. St. Louis Park had a pilot program, and it was extremely successful. Mr. Fernelius stated staff recommends that the HRA authorize CRR to prepare an application on behalf of the HRA for this program and that the HRA set aside $50,000 to fund this program. They have looked at the budget for 2000 and can shift some of the funds in the 5% loan program to accommodate this program as well. Mr. Burns stated that they had a federal reserve interest rate increase yesterday, and they could expect a couple more in the future. How would that affect the cost of this program? Mr. Fernelius stated that it would not affect the cost of the program but would make it more advantageous for people. HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 7 Mr. Burns asked if it would increase the 8% cap. Mr. Fernelius stated it would not. Mr. Commers asked if the cost of bonds would go up and, therefore, they would have to pay a little bit more for their money. Mr. Fernelius stated that it is a possibility in the long-term, but it is his understanding that the rate is 8% under this proposal. Mr. Commers asked if it was for one year. Mr. King, CRR, stated that the proposal is for a period of 20 months. Interest rates change very seldom for these programs. He has been doing these loans for twelve years and they have only changed once. Mr. Commers asked if Mr. Pribyl made the computation for the cost of the write-down at $225 and it should really be $250. Mr. Fernelius stated that was his error. Mr. Meyer stated that he cannot understand why a family or a household with $73,000 annual income has the ability to borrow up to $35,000 and need any kind of public assistance. It is scandalous that people in the City would not fix up their home when they are in this income level. Mr. Commers asked if they could lower the income level for a family. Mr. Fernelius stated that they cannot do that. If they lowered the income to the cap that the City has at $58,650, he is not sure the HRA would be in a better situation than just making the loan at a 5% rate. That may be a better option. The people whose incomes are over that for the MHFA program would be paying a slightly higher rate than the individuals in the 5% loan program. The $73,000 sounds like a lot of money; but if you factor in two-income households making $35,000 per year apiece, it is not a lot of money. This is really designed as an incentive to fix up their homes. He feels it is a worthwhile program. Mr. Commers asked about the parameters and experience in St. Louis Park and Anoka where they have had the program. Mr. King stated that the program in St. Louis Park has a$73,140 cap, and the program in Anoka has a$45,000 income cap. The problem with that type of income cap is that the grant programs that are available to folks in the communities are at about that income level. One thing they noticed with the St. Louis Park program is that the average loan is $21,800. These people may have more means to pay back larger loans. HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 8 Mr. King stated that they just wanted to offer this to the fifteen cities that participated, and Fridley has always been a big supporter with the remodeling handbook. Fridley could set any parameters they like. They are trying to make it as consistent as possible throughout the participating cities so they market it easily to all of the communities. Ms. Schnabel asked what the parameters are for Columbia Heights. Mr. King stated that they would be using $73,140. The other cities have also put in this amount also. Mr. Meyer asked what uses this program would be applied to. Mr. King stated that it would be for space additions, kitchen remodels, bathroom remodels or additions, finishing lower levels, increase heating capacity, but they are trying to get some value added improvements and try to create some more move-up housing. Mr. Burns stated that it is also to try to reduce urban sprawl. Mr. King stated one of the main focuses is to keep the middle-income homeowners in the community to stabilize it. Mr. Meyer stated that he does not see how you would retain anyone in Fridley by giving them this kind of a loan. If they went somewhere else, they would have to buy a brand new home for almost double the amount of money per square foot that they are paying for in Fridley. Mr. Casserly stated that this program is one of the few opportunities that a community has for taking advantage of State activities. The State does not lose money on this program. This program helps fund their 6% and 4% loans. When they had this out at 8%, they were making money. This program gives them another source of funds to help with the write-down. They are asking us to match the write-down to make the 6% even more competitive. It provides the State other revenues for their deeper breakdowns. It helps Fridley in other ways while taking advantage of a State program. Ms. Schnabel asked if there may be a senior citizen segment of the population that might not have taken care of their house because of their fixed income. Have they ever tried to encourage them to take advantage of some of these programs? Mr. Fernelius stated they do service those homes primarily through the CDBG program and HOME grant programs. This program is really targeted to a different market but not at the exclusion of seniors and folks with lesser incomes. None of their programs are tended to benefit the higher income group while excluding lower income folks. The median income on their program overall is around $42,000 which is consistent with the City's median income. Ms. Dacy stated that the planbook and the program gives people a choice to invest in their community as opposed to going to Andover. HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 9 Ms. Schnabel stated that she feels that Fridley housing could be more attractive if kept up and then sold. Are there any limits as to the cost of the home for this program? Mr. King stated that there is not any parameter for the cost of the home in the program, but they could add parameters. Some of the neighborhoods in Minneapolis cap the cost of the home at $125,000. Ms. Schnabel stated that the money should be available to people who are more in need of it as opposed to someone who is in a larger home with a larger income. Mr. Burns stated that he has seen homes on very nice streets that would probably exceed the value limit that she is thinking of. They are mainly there in that value category because of their location but they are in a state of disrepair. By putting a limit of value, they are keeping that homeowner from using this program. Ms. Schnabel asked if the home has that value because they are on that street, or is it a smaller home with other larger homes. Mr. Burns stated that it could be smaller, but because it is in that area it carries a higher value. He can also think of larger ones that need a lot of repairs. He thinks that having the availability to that kind of home would be a value to the rest of the neighborhood. Mr. Meyer stated that he agrees with Ms. Schnabel to put some sort of a cap on a home with an assessed valuation. He would like to see a lower cap on the income and the amount of loan and more restrictions. Mr. Fernelius stated that this evening they could try to design the program or postpone this idea with possibly another opportunity in the spring to reapply. Between now and then they could address some of those issues. Ms. Schnabel stated that if the program was structured differently, they still have other programs available for other moneys and this is an addition to whatever they have in place already. Mr. Commers asked if they could vote to participate subject to developing parameters as to how they want the money spent that they might be able to attain in Fridley. Mr. King stated that the proposal would be as stated and then they could put further restrictions on the use of Fridley's dollars. The reason they brought this to Fridley is the leveraging factor and the amount of dollars they could bring to the relatively small community. With the $50,000 Fridley portion, CRR would do about $1,200,000. Mr. Commers stated that was the strength of the deal. Mr. Burns stated that the average value home in Fridley is about $105,000 for the year 2000 taxes. This may be some kind of an indicator for home value if they are interested in heading in the direction of putting a cap on the value of the home. HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 10 Mr. Commers asked if they could subject anybody in the program to parameters that they would develop and see how it worked. He understands that Mr. King is saying that if you lower the income too much, there are so many better programs for those people and they will not participate. He hates to pass the program up and maybe they could draft something up in the next 60 days and see how the program goes. Mr. King stated that they would not know if they are receiving the matching funds until April so they could do it at that time. Mr. Commers stated they should work with it and the parameters they are comfortable with even if they do not get matching funds. Mr. Casserly stated that the HRA turned this opportunity down before for the reason that they did not have the matching funds for the discount. This is a nice arrangement in terms of what they are providing. It takes Fridley's resources and multiplies them considerably. It is not often they have this kind of program where the State is kicking in this kind of percentage. Mr. Burns stated that the leverage factor is impressive too. Four hundred forty rehab projects probably equals the total number of rehab projects they have done thus far since the inception of the program. There is promise they could do another 440 projects practically overnight. Ms. Schnabel stated that is only if the loans are $5,000 each and theirs will be higher than that. Mr. Commers asked if they could go in the program and between now and April have staff come back with more parameters. MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve the interest write-down program. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 8. REQUEST TO FUND NOISE WALL ENHANCEMENTS: Ms. Dacy stated that this a request to fund some enhancements to a noise wall which will be constructed by MnDOT along the west side of University Avenue. The University Avenue segment between 44t" Avenue on the south and 53rd Avenue on the north side was identified as number ten in terms of noise. There is a lot of industry south of there in Columbia Heights so it is a major truck route to I-694. MnDOT brought this to their attention in October, and they conducted a neighborhood meeting that was completed. The majority of those attending stated they thought it was a great idea and would reduce a lot of the noise they experience. MnDOT keeps track of complaints on noise and this was an area they received a lot of complaints. The Council conducted a public HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 11 hearing on December 13, 1999, with a lot of testimony from the neighborhood and a resolution was passed to have the noise wall installed. Ms. Dacy stated the last time she talked to the Public Works Director, he stated that the cost of the wall, without any enhancements, would cost about $1,000,000. They may extend the wall down 53rd Avenue off of I-694. The standard wall is the wood planks supported by concrete posts. There are no type of decorations on the outside. At the top height, it would be 15 feet with possibly some sections being 10 to 12 feet above grade. They are bringing this issue to the HRA because the size of the structure and because it will be a permanent part of the community's image. Other cities have set the standards of what the wall should look like. If the City looks at what it can do to improve the basic wall, it would send a message to the public that the City cares about its appearance. This project will begin in July. Ms. Dacy stated that there are different types of enhancements. They can try to vary the location of the panel and try to jog its location and provide a visual break. They can put some boards in pine tree design. The concrete posts that support the wall can have decorative caps to add the finished appearance and tint the concrete. The wall on County Road 96 has tinted concrete all the way through the supporting posts and the cap on the posts. It has the pine tree design with boards nailed to the wall that emulate a pine tree. The panels of the walls are placed in front of the concrete posts alternatively for the visual variety. Some of the panels do not have the design and that alternating pattern makes it more appealing. In Richfield the wall by I-494 by the Best Buy, there are a series of walls of 15 feet with the pine tree design and concrete cap with the tint. Ms. Dacy stated that there is no charge on the wall offset. That is a charge the contractor would complete to place the panel in front and then alternate in back of the posts. Installation of the pine tree design for 20% would cost $27,210. The caps of the concrete posts are about $68,000. They could install wood caps on top of those posts to add a finish to the posts as opposed to concrete at no charge. The colored tint all the way through the posts would cost $272,000. This is a specialized process which drives the cost up. Mr. Flora made a very strong pitch to lobby MnDOT for paying the landscaping. MnDOT stated they could not, but Fridley could work with another part of MnDOT about the Community Partner's program. They would reimburse the material cost of the trees and any type of plan or design cost that the City would incur. The City would have to pay for the labor cost and the maintenance. Ms. Dacy stated that the options are to do nothing or evaluate an option for funding the pine tree design and the concrete caps up to $100,000. They could approve the decorative design at a cost of $35,000 and evaluate the state cost share program and see if that could be completed next fall or the following spring. Staff recommends approval of the decorative design and concrete caps. Mr. Commers stated that it would only be on the west side in front, not in people's back yards. Ms. Dacy stated that is correct. HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 12 Ms. Schnabel asked if she was talking about the large pine trees in Richfield or the smaller pine trees on Highway 96. Ms. Dacy stated that she thinks they were referring to the pine tree design on County Road 96. Ms. Schnabel stated that she thinks the ones on County Road 96 show up better than the ones in Richfield. Mr. Meyer stated that he knows that people say that the sound barriers are not what they are cracked up to be in terms of efficiency and usefulness in deadening sound. Are these really needed or wanted by the residents? Ms. Dacy stated that the public testimony was very strong . After hearing MnDOT staff describe their experience with these walls, it will reduce the decibels anywhere from 5- 10 which is significant. Mr. Burns stated that he thinks it is about a 40% noise reduction. Ms. Schnabel stated that she has heard that the walls on I-694 are very beneficial to people adjacent to them, but it increases the noise as you get a block or more away. The sound gets to the top of the wall and bounces. Mr. Burns stated that the person from MnDOT recognized that as you get further away from the highway, the noise does not get much better. He did not say it would make it worse. Mr. Commers stated that the noise is not any worse for those people, or is it because of the bouncing effect the noise goes farther back? Ms. Dacy stated that the MnDOT person seemed to suggest that there has been no concrete data to suggest that it does get worse. The theory of bouncing over the wall for the first couple of blocks in general is true. It is a difficult situation but it will apparently relieve some noise congestion. Mr. Commers asked Mr. Casserly how they would qualify their funds for this type of thing. Mr. Casserly stated that this is a public improvement that would be eligible provided it is in the project area. It is not an issue. Mr. Meyer stated that his observation is that vines growing on the noise walls are extremely attractive. They take away the harshness of the boards and concrete. Ms. Schnabel stated that she wanted to incorporate the decorative design. This is going to be a stark wall that people passing through the community will look at. Enhancement of the wall would be a credit to their community. She feels that tinting the HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 13 concrete is not so important, but some type of decorative design on the wall to break the monotony of the sheer wood would be worth it. Mr. Meyer stated that he thinks softening it with vines is a better solution than anything man made. What do they do after two or three years if the vines take over and crawl over the fence anyway and hide the decorative endeavors? Mr. Commers stated that they can work with MnDOT's other part of the program to work with the landscaping. Ms. Dacy stated that there still may be some costs associated with that and they certainly will ask about vines. MnDOT is really picky about the types of vegetation that can be used. MOTION by Ms. Schnabel, seconded by Mr. Meyer, to approve the addition of decorative trim and discuss with MnDOT the addition of some type of vines to the wall. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. Mr. Commers stated that they previously had done a really detailed study of University Avenue. He would really like to see the report on that. He understands that this year they are going to cut the grass on the median and are they doing any other improvements along University Avenue? Mr. Burns stated that was correct and they are getting two signs on the north and the south. They are looking at putting in plastic pipe and filling in swales north of Rice Creek on the west side of the street. MnDOT is not willing to pay for the pipe and that is the issue right now. Mr. Commers stated that they were willing to make a financial commitment and ask for participation from the commercial people and that is where it broke down. Mr. Burns stated he thought the HRA voted on the University Avenue Corridor Plan, but he is not sure what the disposition of it was. Mr. Meyer stated that the City businesses did not want to fund a certain portion of it, and the whole program came to a complete stop. Ms. Schnabel stated that she chaired that commission. Mr. Commer stated that he remembered that the problem was how the decorative lights would be paid for. Mr. Burns stated that they have discussed the University Avenue fence. MnDOT will do what they want them to do. The issue has been that the residents by and large do not want to take the fences down in general. The commercial business owners would like HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 14 to see the fences come down. The question is then if they take the fences down, can they put up some other type of attractive fence. The next issue is who pays for it? Ms. Schnabel stated that it is a safety issue of children and animals attempting to cross University Avenue and the fence is the deterrent. The businesses saw the fence as a barrier for customers coming in. Mr. Commers stated that the character has changed a lot, and there is very few residential left along University Avenue. 9. RESOLUTION TO AMEND HRA BY-LAWS (continued from Consent Aqenda): Mr. Commers stated that in Article #4, Section #1, there needs to the Chairperson inserted and possibly insert "or in their absence the Assistant Executive Director." Ms. Dacy stated that would be taken into consideration. MOTION by Mr. Meyer, seconded by Ms. Schnabel, to approve Resolution No. 2-2000 the HRA, "A Resolution Amending the By-Laws of the Authority" as amended. UPON A VOICE VOTE ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 10. AUTHORIZE APPLICATION TO MHFA FOR FIRST-TIME HOMEBUYER PROGRAM: Mr. Commers asked Mr. Fernelius why they need to worry about participating with other communities? Mr. Fernelius stated that this provides them with the opportunity to access more funds. If they go in with the County program, the formula for determining the allocation is based on a larger population. That is the biggest benefit. Mr. Commers asked how they would get it allocated in the County. Mr. Fernelius stated that people would not be able to use the County's program in Fridley. If they did not go in on this proposal and applied on their own, they would get their customary allocation which is about $500,000. This could potentially access more money than that. Mr. Commers asked Mr. Fernelius how the County allocates it. Mr. Fernelius stated that the County would not allocate it. It would be available to any of the participating cities. It depends on first come, first serve. Mr. Commers stated that maybe they did not want to get into that race. HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 15 Ms. Dacy stated that they talked about that too. They have had a lot of activity. The market area is set up for first-time homebuyer market. They felt that it is a reasonable risk because of their market position and location that they are in a good position to receive these funds. If the HRA is uncomfortable with that, they could still stick with the customary allocation. Mr. Commers stated that he is just not sure. This way they would get a pretty good allocation and he hates to get into an aggressive battle with other communities over who is going to get what. Mr. Burns asked if they are locked into it forever. Mr. Fernelius stated that it is a one-year commitment. The maximum purchase price limit for this program is $121,000. They might be able to fund four or five or potentially more if they went into the County program. Mr. Commers stated that they may get less. Mr. Fernelius stated that is correct. Mr. Commers stated that it does not seem like they have this thought out on the County level. Ms. Schnabel asked if there are only two other cities that would possibly join in. Mr. Fernelius stated that it would be the balance of the County, the cities that have typically applied on their own. Fridley, Columbia Heights, and Anoka are the cities that have historically applied on their own. Ms. Schnabel asked if there could be other cities participating in it. Mr. Fernelius stated, yes. Ms. Schnabel stated that if only those three cities wanted to join, could there still be other cities benefiting from it? Mr. Fernelius stated it is a County-wide program entirely. Mr. Commers stated that it is just the question of the three cities that have been doing it on their own and now they would throw out whatever they would get into that pot. The question is what kind of a thing does it become? They do not want to be in some race to collect. There is a lot of homebuilding in Andover and Ramsey and those may be first-time homebuyers. Ms. Schnabel stated that with the Medtronic bill, there is the potential of thousands of jobs. That may create a market for some of the housing in Fridley. HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 16 Mr. Fernelius stated that he believes that sales in Fridley for existing homes are around $275,000 -$300,000 per year. That is a pretty constant number. What they would capture through this program would be a very small percentage of that. Mr. Commers stated that property values will increase with the project, and there has got to be some pressure placed on the community for housing. He does not see any reason not to continue to participate in the program. The only question is whether they do it on their own or with the County taking a risk they do not have right now. Mr. Fernelius stated that it is a one year commitment, so if it does not work, they have the opportunity to apply. Mr. Commers asked Mr. Burns what the total County population is. Mr. Burns stated that he is not sure. Ms. Dacy stated that Fridley's population is about 28,000. What they do have going for them is that they do have a good economy, and the interest rates are still at very attractive prices for first-time homebuyers. She suggests they try it for a year. Ms. Dacy asked Mr. Fernelius if there is a minimum amount of activity that is required if they do the pooling approach. Mr. Fernelius stated that they have to use at least half of this amount or they are not allowed to participate in the following year's program. There is the potential risk that they could be excluded from the plan again. Ms. Dacy stated that the odds of being excluded from the entire County allocation is very low. Mr. Commers asked how they would market this. Mr. Fernelius stated that they would market it through the newsletter which goes out quarterly to all of the households in Fridley and through the realtors. Mr. Commers asked who runs it. Mr. Fernelius stated that their involvement is limited. The lenders underwrite the loans and sell them directly to MHFA. Mr. Meyer stated that a footnote states that new construction in the Twin Cities area is only available in Chisago, Sherburne, and Wright Counties. What does that refer to? Mr. Fernelius stated that information contradicts the information he had heard earlier from MHFA. One of the questions he had for them is whether folks could take advantage of this program on the Scattered Site Infill Program. He will have to clarify that. HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 17 Mr. Meyer asked about the income limits and how it was defined when you apply for the loan. Mr. Fernelius stated that is another thing he needs to follow up on. Mr. Commers stated that it is like any mortgage application certifying that you are giving information honestly and have liability if the applicant is lying. Mr. Casserly stated the same procedure is used where they fill out an affidavit where they swear this is true; and if they obtain the loan fraudulently, they will have to pay the due. Mr. Meyer asked what a household is defined as. Ms. Dacy stated that it would have to comply with the local zoning qualifications. Unrelated individuals are limited to five per household, and she thinks that it would come under the same approach Mr. Casserly just mentioned. They could follow up on the definitions. Mr. Casserly stated there is a book about regulations and interpretations that describes all of this in detail. They reference that in the program. Mr. Fernelius probably has it and can share it with them. Ms. Schnabel asked Ms. Dacy or Mr. Fernelius to explain why it would be advantageous for them to join a pool as opposed to doing it individually. Mr. Fernelius stated that the advantages are that they could access a larger pool of money. They have two options tonight. They could postpone or design a program this evening. Ms. Schnabel asked if they have had requests that they have had to turn down because there has not been enough money in the pool. Mr. Fernelius stated that he cannot say for certain. He does not deal with a lot of people who access this program. He can say that they have always used the allocation. Ms. Dacy asked if the funds would be available in April or May. Mr. Fernelius stated that is correct. Ms. Dacy stated that part of the push they are trying to make in the comprehensive analysis is to make the housing as attractive as possible for first-time homebuyers. They do want to make more of an outreach to the realtor community to educate them about what they are doing with the housing rehab and remodeling advisor. They want to make a greater push to say that they now have access to a greater pool for first-time homebuyer funds so they do not forget about this program. HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 18 MOTION by Ms. Schnabel, seconded by Mr. Meyer, to authorize the application to MHFA for the First-Time Homebuyer Program for the year 2000. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. Mr. Meyer asked Mr. Fernelius if it makes a difference if they cannot use this program toward new construction. Mr. Fernelius stated that he does not think it would be that much of a negative. The volume of the Scattered Site program the last couple of years has not been real significant so it probably would not have a huge impact. INFORMATION ITEMS: 11. GATEWAY EAST SCHEDULE AND UPDATE: Mr. Fernelius stated that they are making significant progress on the land acquisition part and they are in the middle of the condemnation process for the Valvoline and the Miller lot. They went through the quick take, and it should be completed at the end of the month and should be entitled. The Commissioner's hearings have not been scheduled at this point to determine the value of the property. The duplex acquired from the Fogarty's was closed on last Friday and those tenants are still in the property and should be out by the end of March. The demolition and environmental testing has been wrapped up on the Cash'n'Pawn and JR's Automotive building. Those buildings are ready to be taken down in the next 60 days or so. Mr. Fernelius stated that they are working on an RFP right now. They met with one developer yesterday to get feedback on the idea of doing a townhome project there. They received positive feedback because of the great demand for townhomes on that site. Over the next couple of months they would like to define a little bit more the process of finding a developer. They did hear that because of the 24 unit project, they are not likely to get a whole lot of interest from the real big high volume developers. They are probably looking at a small scale developer and now they are trying to find out who those people are. They would like to go to the Planning Commission with some conceptual information to keep them included in the process. They should have better definition at the March or April meeting. They are probably looking at a fall time window in terms of breaking ground on this project and probably would not start actual construction of the units until 2001. They think that they can meet that time schedule. Ms. Schnabel asked if they have locked into 24 units. Mr. Fernelius stated that they have not locked into that. That is the maximum for this site plan. HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 19 12. MEDTRONIC UPDATE: Ms. Dacy stated that the meeting scheduled this morning for TH 65 issues was canceled due to Mr. Haggeman's father passing away. The meeting will be next Thursday. They took a tour of the CSM National Development Company's hotel developments in the metro area. They saw variations of extended stay facilities. CSM, as a franchisee of the Marriot chain, was able to add more amenities to basic hotel type of product. They were very impressed with what they have done in the last four years. Ms. Dacy stated that they are exploring an idea with Columbia Heights to jointly look at the impacts of the Medtronic projects and how the can respond to those opportunities. They will have more of an update in March. Mr. Commers asked about Medtronic's letter and Mr. Burns' response. The letter states that they would be responsible for all of the infrastructure. Ms. Dacy stated that they also quoted other parts of the development agreement that identified that the City would undertake every effort to obtaining funding for potential expansion of that highway. They are waiting on federal funding determination. Mr. Commers stated that Medtronic seems to be taking a position that they are responsible no matter what. Ms. Dacy stated that she disagrees to a certain extent. Mr. Casserly stated that he thought it was a clear and reasonably self-serving letter and they responded as kindly as they could. They said they were going to get together and make this work. Mr. Commers stated that there are some lines being drawn that will have to be addressed. Is the 2010 or 2011 kick-in date for funds affected? Mr. Casserly stated that they would have expenses that should so far exceed whatever they could recover which would have to be monitored. They would reimburse them for eligible expenses. All that is really going to happen is that if they build sooner, they would have more expenses. Mr. Commers stated that if their expenses go way up, they are entitled to get reimbursed for those expenses. Mr. Casserly stated that they could only be reimbursed a certain percentage. They have the opportunity to cover more, but not more than the percentage. 13. REMODELING ADVISOR: Mr. Fernelius stated that they are in the process of looking for a new Remodeling Advisor, and they will keep the HRA updated. HOUSING & REDEVELOPMENT AUTHORITY MEETING. FEBRUARY 3. 2000 PAGE 20 Mr. Meyer stated that the former Remodeling Advisor was very good. Mr. Fernelius stated that she was a very good employee. It just came down to an issue where she could not work the hours because of other commitments and he is sad to see her leave. 14. REHAB PROGRAM UPDATE REGARDING ELIGIBLE IMPROVEMENTS: Mr. Commers stated that this would be put into the next survey and see what people say about it. Mr. Burns stated that it is definitely in the survey. 15. COUNCIL COMMISSION SURVEY DISCUSSION: Mr. Burns stated that he had hoped to have the survey for the meeting, but it should be out sometime next week. He would like the HRA to meet with the Council once the survey results are completed around the end of February to discuss the results. There are some important development issues on that survey that would be a good basis for joint discussion. 16. UPDATE ON MISCELLANEOUS PROPERTY ACQUISITIONS: Mr. Fernelius stated that there are number of properties that were approved at the December meeting and those funds have been placed in escrow. They have completed three of those closings, but the other sites had some issues they need to work on. Mr. Commers stated they do not have the reports back on the analysis of the Old Central lots by the rust-proofing place. Mr. Fernelius stated that the testing and analysis has been completed. They should get the final report back soon and will update the HRA at the March meeting. ADJOURNMENT MOTION by Ms. Schnabel, seconded by Mr. Meyer, to adjourn the meeting. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED AND THE FEBRUARY 3, 2000, MEETING OF THE HOUSING AND REDEVELOPMENT AUTHORITY WAS ADJOURNED AT 10:03 P.M. Respectfully submitted, Signe L. Johnson Recording Secretary