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HRAM 10/02/2014 CITY OF FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY COMMISSION October 2, 2014 CALL TO ORDER: Chairperson Commers called the HRA Meeting to order at 7:00 p.m. ROLL CALL: MEMBERS PRESENT: William Holm Larry Commers Pat Gabel Stephen Eggert Gordon Backlund OTHERS PRESENT: Paul Bolin, HRA Assistant Executive Director Jim Casserly, Development Consultant ACTION ITEMS: 1.Approval of Expenditures MOTION by Commissioner Holm to approve the expenditures. Seconded by Commissioner Eggert. Commissioner Gabel asked what the CEE check what for. PaulBolin, HRA Assistant Executive Director, replied the bulk of the funds were for the loan program. Commissioner Gabel asked if part of the home energy audit was to insulate around the doors. Mr. Bolin replied yes; that is part of the service. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY 2.Approval of September 4, 2014, Meeting Minutes MOTION by Commissioner Eggert to approve the minutes. Seconded by Commissioner Backlund. Commissioner Gabel noted the following changes: th in Page 2, 6 paragraph, should read “funds should be used for anything authorized” City of Fridley Housing and Redevelopment Meeting of October 2, 2014 2 th “admin administrative Page 2, item 4, 4 sentence should read ” UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MINUTES APPROVED AS AMENDED 3.Approval of 2015 HRA Meeting Dates MOTION by Commissioner Holm to Approve the 2015 HRA Meeting Dates. Seconded by Commissioner Backlund. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY 4.Approval of Amendment to Cielo Redevelopment Agreement Paul Bolin , Assistant HRA Executive Director, stated that last June, the Authority approved a development agreement and authorized the sale of the Gateway Northeast property to Cielo Partners. Since that time the final land use approvals were granted and the plat was delivered to Anoka County for recording. Cielo’s funding is in place and the closing will happen as soon as the County has the plat recorded. Mr. Bolin said that staff has continued to move towards closing on the property and Trident recently raised an issue with the timing of installing the underground stormwater system for Phase 2 of the development. In the redevelopment contract, under SCHEDULE F – SITE IMPROVEMENTS it reads that the stormwater system for phase 2 would be installed during phase 1. The developer intended it to mean that the systems would be constructed in their respective phases, as the systems are approximately $200,000 each. After discussion with the developer, legal counsel and Chairman Commers it was determined that so long as the cost was capped at $200,000 for each system, this change does not impact the Authority. Mr. Bolin said that staff recommends the Authority approve the minor change to the interpretation of SCHEDULE F – SITE IMPROVEMENTS – Extraordinary Site Costs, for the Underground stormwater infiltration systems (Phase 1 and 2) found in the Cielo Gateway Northeast Redevelopment Agreement. Commissioner Eggert noted that phase 2 of the project will not be completed at this time so this filtration system will not be needed and the area is currently grass. He asked if there was any concern about runoff. Mr. Bolin replied yes, the storm water system will not be needed until phase 2 is added and there is no concern about runoff until that is installed. Chairperson Commers stated that if this is not done it will not get credited against the land purchase price so it is a set off. Mr. Bolin replied that is correct City of Fridley Housing and Redevelopment Meeting of October 2, 2014 3 Roger Fink , Developer, stated that they knew they had to build it but thought it could be done during either the first or second phase. It isn’t needed until the second phase is built and a cap has been set on the dollar amount for protection against inflation. Commissioner Holm asked if phase 1 and phase 2 were the same size. Mr. Fink replied yes. Commissioner Holm asked if there was any advantage or disadvantage in terms of this delay for phase two in terms of the cap of $200,000; this will protect the city. Mr. Bolin replied yes; the city will be protected from inflationary increases. MOTION by Commissioner Gabel to Approve Amendment to the Cielo Redevelopment Agreement. Seconded by Commissioner Backlund. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY 5.Approval of Amendment to DEED Grant Agreement Paul Bolin , Assistant HRA Executive Director, stated that last month the Authority approved an amendment to the DEED contamination cleanup grant for the Northern Stacks project to allow the developer’s cost to “cap” the soils underneath buildings and other areas to count as a local match. This month the Authority is being asked to make a change to the DEED redevelopment Grant in order to accurately reflect the amount of demolition and other eligible work being done on the site. Mr. Bolin said that as the development is now underway, there have been changes to what is actually happening on the site. Demolition costs, which were expected to be over $1.1M for the first phase ended up being just over $200,000, as BAE’s data center could not be moved and raised as part of the first phase. The amendment to the agreement will allow the grant funds to also be used for drive lanes, curbing and major utility installation. Mr. Bolin said that staff recommends approval of the amendment to DEED’s Redevelopment Grant Contract to accurately reflect improvements being constructed in the first phase of this large redevelopment project. Commissioner Holm asked when DEED makes adjustments to the formal language if it will be sent back to the City and be signed in the normal manner. Mr. Bolin replied yes. Commissioner Gabel asked if BAE would be moving the things at a later date or if they were leaving it there permanently. City of Fridley Housing and Redevelopment Meeting of October 2, 2014 4 Mr. Bolin replied that the data center will eventually be moved. Commissioner Gabel asked if moving it would incur any additional costs. Mr. Bolin replied no; there is a big data center down there and they couldn’t wait for BAE to move everything to the north end. Commissioner Gabel said this is irrelevant to the demolition money. Mr. Bolin replied that is correct. Commissioner Gabel said that it is amazing they haven’t had any surprises. Commissioner Backlund asked if the Navy needed to be involved. Chairperson Commers replied that Mr. Hyde has negotiated any involvement with the Navy. Their liability and obligation for that, reached some kind of accommodation. MOTION by Commissioner Backlund to Approve the Amendment to DEED Grant Agreement. Seconded by Commissioner Gabel. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY 6.Approval of Amendment to MNCEE Home Energy Squad Contract Paul Bolin , Assistant HRA Executive Director, said that the Home Energy squad program provided through the Center for Energy and Environment has been a huge success since its launch in April of this year. As of early September, 78 homes in Fridley have gone through the program, making them more energy efficient. Mr. Bolin said that this program has no income limitations, making it available to all residents of the community. The total cost for each visit is $120, with the HRA paying $70 towards each home visit. For $50 out of pocket, the homeowner receives a visit from two energy experts. During the 2 hour visit, diagnostic tests are run to identify inefficiencies in the home. The experts then install door weather stripping, water heater blankets, programmable thermostats, high efficiency light bulbs and efficient shower heads as needed. Mr. Bolin reported that the Authority initially authorized an investment of $5,000 to write down the cost of these visits. Due to the popularity of the program, staff is recommending authorizing another $5,000 to continue the program. The Authority has adequate funds in its revolving loan fund to allocate another $5,000 for these visits. As staff begins to work on the 2015 budget, they will incorporate funding to continue this program into 2015. Staff recommends approval of the amendment to the Home Energy Squad contract, allowing the program to be funded through December 31, 2015. City of Fridley Housing and Redevelopment Meeting of October 2, 2014 5 MOTION by Commissioner Gabel to Approve the Amendment to MNCEE Home Energy squat Contract. Seconded by Commissioner Eggert. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY 7.Authorization to Solicit Bids for Demolition of 7011 University Avenue NE Paul Bolin , Assistant HRA Executive Director, stated that staff is anticipating a late October closing on the Columbia Arena site. Staff would like the ability to move forward with soliciting bids to demolish the property. Due to potential liabilities, the deteriorated condition of the buildings and the expense associated with maintenance, staff is recommending the buildings be demolished and parking lot removed as quickly as possible. In August, the HRA and City Council adopted resolutions declaring the properties blighted which will preserve the ability to put the parcels into a future TIF District. Mr. Bolin said that this property has been vacant and is an attractive nuisance. Besides presenting a poor image, staff continues to have problems with truckers illegally parking in the lot, vandals breaking in and spray painting the interior, thieves stealing the copper and continual reports of the building being “open to trespass”. Removal of this building and the sea of asphalt is the only way to address these problems. Mr. Bolin said that staff will work to solicit bids in anticipation of awarding the demolition th contract on November 6. Depending on cooperation from the seller and the closing date, th staff may not be able to award the contract on November 6. Staff recommends the Authority authorize staff to begin the bid solicitation process. Commissioner Eggert noted that it has taken while for Braun to get out there, the contract needed to be extended and they needed to take more soil borings. Commissioner Eggert noted that another issue of delay is the pollution control work with proper disposal of whatever is found. Mr. Bolin said that is not part of the delay yet but that is part of further data gathering. Staff will need to come up with a solution with MPCA to address the vapors in the soil. Commissioner Gabel asked if staff will be able to get concrete information from the MPCA in order to close by 10/30. Mr. Bolin replied yes. Chairperson Commers noted that this is a partnership with the City of Fridley and asked if the demo costs and miscellaneous costs incurred would be considered as part of the purchase agreement and divided 50/50 between the Authority and the City. City of Fridley Housing and Redevelopment Meeting of October 2, 2014 6 Mr. Bolin replied that so far the City has allocated $1.5M toward this project and the Authority has about $2.6M in acquisition and demolition costs as well. As of right now the City has committed $1.5M. Chairperson Commers asked if that information was documented, the partnership with the City. He didn’t recall seeing anything as to who is contributing what to this effort. Mr. Bolin replied that staff has not written up a formal contract. Chairperson Commers asked if an agreement should be written up going forward as to who is paying for what. He asked if it will be taxed for one year, next year Jim Casserly, Development Consultant, said that taxes were paid even though the buildings are being removed. After the first year the property is tax exempt. He isn’t sure how long it can be tax exempt. A discussion needs to be held about how the Authority will be allocating the expenses going forward. Commissioner Backlund said that discussion was held regarding the landfill and wetland that was covered up. He doesn’t recall what year this was built, maybe in the 70’s. He asked if a date was provided if they would know if the fill is there. nd Mr. Bolin replied that the arena construction started the first building in 1968 and 2 building in 1971 or 1972. When Anoka County bought the land they bought it from a small regional railroad. It looks like a lot of the fill came in 1964 and 1965. The air photos show a lot of construction happening down there in the same time frame. MOTION by Commissioner Backlund to Authorize Staff to Solicit Bids for Demolition of 7011 University Avenue NE. Seconded by Commissioner Eggert. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY Informational Items 1.Housing and Loan Update Paul Bolin, HRA Assistant Executive Director, reported that one loan was closed for a total of 10 year to date and there was one remodel advisor visit making a total of 5 year to date. There were 11 Home Energy Squad visits for a total of 84 year to date. Adjournment MOTION by Commissioner Holm to adjourn. Seconded by Commissioner Eggert. City of Fridley Housing and Redevelopment Meeting of October 2, 2014 7 UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY AND THE MEETING ADJOURNED AT 7:52 P.M. Respectfully Submitted, Krista Peterson, Recording Secretary