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HRA 11/05/2009 - 29549,N � CITY OF FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY COMMISSION NOVEMBER 5. 2009 CALL TO ORDER: Chairperson Commers called the HRA Special Meeting to order at 7:00 p.m. ROLL CALL: MEMBERS PRESENT: NONMEMBERS PRESENT: ACTION ITEMS: 1. Approval of Expenditures Larry Commers Pat Gabel John Meyer William Holm Scott Hickok, Community Development Director MOTION by Commissioner Gabel to table the approval of the expenditures until the December meeting. Seconded by Commissioner Holm. UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY 2. Approval of October 1, 2009, Meeting Minutes MOTION by Commissioner Holm to approve the minutes as presented. Seconded by Commissioner Gabel. Commissioner Gabel asked for page two, second paragraph, second sentence from the bottom change propose to proposal. Also on page three, first paragraph, spell out SF to read Single Family. Commissioner Holm asked on page two, fourth paragraph from the bottom to read as follows: Commissione� HolnZ said he previously opposed the demolition because HRA didn't have enough contiguous properties under its cont�ol but that is no longer the case and he supports the demolition. UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MINUTES APPROVED AS AMENDED. 3. Approval of the Home and Garden Show Administrative Contract Scott Hickok, Community Development Director said that Fridley has been the fiscal agent for the Home and Garden Show for 12 years. (Blaine & Mounds View) Revenues from booth rental cover the expenses for show. Since 2005, the Home and Garden Show has contracted with Marsha Wagner/Castle Visions to perform all administrative tasks for show. Her work has been excellent and is much appreciated by all. Staff recommends approval of the contract authorizing Castle Visions to perform administrative work for the 2010 Home and Garden Show. Chairperson Commers asked if this is the same event as we have had in the past. Mr. Hickok said yes. Commissioner Holm asked how this event was paid for. Mr. Hickok said that the event is self funding. Commissioner Holm asked if staff took care of the administrative costs. Mr. Hickok said yes. MOTION by Commissioner Gabel to approve the Home and Garden Show Administrative Contract. Seconded by Commissioner Meyer. UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY 4. Approval and Awarding of Demolition Bid — Gateway Northeast Scott Hickok, Community Development Director said the HRA currently owns six vacant blighted properties along University Avenue in the area referred to as Gateway Northeast. They are as follows: ♦ 5865 University Ave. (Oriental House) ♦ 5924 University Ave. (Alano) ♦ 5945 University Ave. (New VOL) ♦ 6005 University Ave. (CARQUEST) ♦ 6041 University Ave. (Old VOL) ♦ 6071 University Ave. (Sinclair) Mr. Hickok said that the cost for demolition would be over $50,000 which requires a formal bid process. The City Public Works Department ran the process on our behalf. Bids opened at 2 PM on November 5`�' and nine bids were received. Bids ranged from $155K to $281K. Landwehr Construction was the low bidder. Staff recommends the contract be awarded to Landwehr in the amount of $154,931. Landwehr will be able to complete the demolition in the desired timeframe. Chairperson Commers asked if there was anything unusual about this project in terms of the demolition that involves any extra work or protection. Jim Kosluchar, Public Works Director, said yes; there are fuel storage tanks, an abandoned well and parking lot removals to name a few. Chairperson Commers asked if State Aid was available for help with the costs of the fuel tank removal. Mr. Hickok said that up to 90% of the cost will be reimbursed through the State program. Chairperson Commers asked if the ground was checked for contamination. Mr. Kosluchar said that the contamination levels in the ground were low. During the excavation stage more soil sampling will be done. Commissioner Gabel said that if the soil contamination is worse than anticipated, the demolition cost will increase. She asked if the city would be reimbursed for the contamination. Mr. Kosluchar answered yes. Commissioner Gabel asked why the estimates were so high and if it had to do with the gas station. Mr. Kosluchar distributed an extensive cost allocation report and reviewed it with the Authority. The majority of the charges are for handling the bigger components. Commissioner Meyer asked what the city knew about Landwehr Construction. Mr. Kosluchar said that staff knew very little but they were the first ones to call about the job. Mr. Hickok said that staff does know that Landwehr does work around the Twin Cities area even though they are located in St. Cloud. Mr. Kosluchar said that the contractors are familiar with the site and were able to walk in the buildings and ask questions. Everyone is familiar with the work that needs to be done. Commissioner Meyers asked what qualifications were required from the various bidders. Mr. Kosluchar said that no pre-qualifications had to be met but requirements need to be met with the bid. If a contractor is excluded by MnDOT they would be excluded but this contractor does not fall into that category. Chairperson Commers asked for a timeline on the project. Mr. Hickok said that project could start in mid November by removing the buildings and in the spring remove the parking lot, curb and gutter. The idea is to have the contractor remove the immediate danger items. Mr. Kosluchar said that there is a requirement to get buildings removed before Christmas and to secure the sites. The contractor can be more aggressive and finish as much as possible by the end of the year but has until the spring to complete the project. If the work is confined to a narrow time frame, the bids would be much higher. Commissioner Gabel asked for clarification that the contractor would not be paid until the work was completed. Mr. Kosluchar said that is correct. Chairperson Commers asked if the tanks would be removed in next spring. Mr. Kosluchar said the contractor may do that but also may remove them now if so desired. Commissioner Meyers asked if the necessary certificates, insurance and performance bonds have been received. Mr. Kosluchar said that is the next step in this process. e Commissioner Gabel asked about the well sealing and why the well isn't required to be removed. She also asked how the well is sealed. Mr. Kosluchar said that the well sealing is a typical process and goes hand in hand with the Department of Health. The well won't be removed because it is a deeper well. The contractor will fill the area with grout and cap it so nothing can enter it in the future. Because we are not sure if the well is properly sealed, the covers will be removed and resealed if needed. Commissioner Gabel asked if that would increase the cost. Mr. Kosluchar said that is correct; but until you uncover it, you don't know what is underneath. Commissioner Gabel asked if the city still allows people to drill for .welis. Mr. Kosluchar said no and said that there are a lot of wells in Fridley. The city prefers for people not to drill wells but they can if certain requirements are met. Commissioner Holm asked if the demolition included foundations for structures, floor, and basement. Mr. Kosluchar said that he couldn't confirm that 100% but recalled a conversation about footings. Commissioner Holm asked about turf establishment and if grass would be put down in the spring. Mr. Kosluchar said that is conect. MOTION by Commissioner Holm to approve and award the demolition bid for Gateway Northeast to Landwehr Construction. Seconded by Commissioner Gabel. UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY 5. Approval of Interfund Loan — General Fund to Gateway Northeast Richard Pribyl, Finance Director, said that the purpose of the Interfund Loan is to loan potential future TIF District (Gateway Northeast) $4,300,000 to finance redevelopment efforts until such time that the District creates enough tax increment to pay back the loan. The Loan Terms are $4,300,000 at IR: 0% and Loan Length until 12/31/30 (20 yrs). The loan may be paid off early if sufficient increment available. Chairperson Commers asked if this can be done properly without an interest rate. Mr. Pribyl said yes, this has been done before. MOTION by Commissioner Meyers to approve the interfund loan — general fund to Gateway Northeast. Seconded by Commissioner Holm. UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY 6. Approval of 2010 Housing and Redevelopment Authority Commission meeting dates. MOTION by Commissioner Holm to approve the 2010 Housing and Redevelopment Authority Commission meeting dates. Seconded by Commissioner Gabel. UPON VOICE VOTE, ALL VOTING AYE, CHAIRFERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY INFORMATIONAL ITEMS: 1. Bond Call Scott Hickok, Community Development Director said the redemption of General Obligation Bonds for TIF Districts 1, 2, and 3 have increments pledged to repayment of the 2004B Revenue Bonds. Districts have/are expiring with a cash balance near $3,200,000 and a balance of $1.7M left to pay on bonds. The interest rate on the remaining principle ranges from 3.75% to 4.350% which is in excess of the 1.5% to 2.5% that is being earned on the $3.2M. Mr. Hickok said that the cash remaining in these districts is required to be returned to the County for distribution to taxing districts. Paying off bonds in February 2010 will place an additional $430,000 in the City's general fund. With the expiration of these three pledged districts, the taxable value will go back on the tax roles; about 7.9% of the 2009 total taxable value. Commissioner Gabel asked if the $430,000 would get into the city fund from increment. Richard Pribyl, Finance Director said that it would be transferred at the payoff of the bonds to the Center City Fund. That fund will be closed at end of this year and that fund will mature so the balance of the funds will be turned by statute to the county and the city ends up with their share of increment dollars by Anoka County. , Chairperson Commers asked if there were any funds left in District 2. Mr. Pribyl said that district was decertified last year and any access was turned back last year and redistributed. Chairperson Commers noted that there was $3.2M in districts 1 and 3 and out of that $1.7M will be paid out in bonds. Those two districts were certified to use funds only for those bonds and once the bonds are paid off the excess funds will go back to the County. Mr. Pribyl said that by prepaying these bonds it will close at the original certification date. In the end it will be a success story and the HRA redeveloped property which added to the tax base. Chairperson Commers asked if because the interest rate on the bonds is 2 or 3 points more than what �ve are receiving if it made sense to keep it open. Commissioner Holm asked who benefited from District 3. Mr. Pribyl said it would be the north area; Center City, North and Moore Lake. School District 14 and a piece of School District 11 are in District 3. Chairperson Commers asked when the funds would go back to the County. e Mr. Pribyl said the first settlement would be June 2010. 2. Northstar Update Scott Hickok, Community Development Director said that the certificate of occupancy has been issued on the 5�' and the station looks very nice and near completion. Everyone worked hard to get things ready on time and we are ready for the grand opening. 3. Housing Loan Program Update Scott Hickok, Community Development Director said that in October two RLF loans were closed making a year to date total of 11 RLF loans and two other loans. Remodeling Advisor Visits were two for October making a total year to date total of 15. Scott Hickok said that this program is a reflection on the market in general and people have stalled construction plans as they work on more basic economic things at home. Staff is optimistic that when the economy opens up, the program will pick up. A lot of people are happy where they are living and would like to stay here and do things to their home. This program should inspire activity for additions and remodels. Commissioner Gabel asked if the aging reports on loan programs could be included next month. Mr. Hickok said that would not be a problem. Commissioner Gabel asked if we should back off on the loan expectations so people can get their finances straightened around. Mr. Hickok said that Paul Bolin was going to talk to CEE. He did not have the report and made a note to discuss this at next month's meeting. NONAGENDA UPDATE: Scott Hickok, Community Development Director said that the Anoka County HRA and East Bethel did go to court. East Bethel created an HRA and could have been at odds with the county levy tax for HRA County wide. There was some activity in court on that this week and they had a preliminary hearing. They don't have their second opinion back and it is not likely they would levy county wide in the near term until they have a strong opinion. That is still something for the court decision and in short term would not levy in East Bethel Mr. Hickok said that he received and optimistic call from Select Senior Living saying they finished their financial package in Mounds View. The bank package has been completed and they plan to go ahead in Mounds View. Now they need to focus on the Fridley location. The owner seems more inclined to subdivide the Columbia Arena site so Select Senior Living may go onto that property. Staff is optimistic a Fridley project will be happening. Mr. Hickok said that Cub Foods wants to be under construction by early construction season 2010. The existing building will be changed dramatically and McDonalds will disappear and may be free standing in the area. o a ., r ADJOURNMENT• MOTION by Commissioner Meyer to Adjourn. Seconded by Commissioner Holm. UPON VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY AND THE MEETING ADJOURNED AT 8:15 P.M. Respectfully Submitted, (���'� ��l �n��r� � I Krista Monsrud, Recording Secretary CITY OF FRIDLEY SIGN-IN SHEET HOUSING & REDEVELOPMENT AUTHORITY MEETING l��l�.���'�� 2�� � � --------------------------------------------------------------------- --------------------------------------------------------------------- Name and Address Agenda Item of Interest