2003-07-08Fig
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AGENDA
MOUND HOUSING AND REDEVELOPMENT AUTHORITY
JULY 8, 2003
6:30 P.M.
PAGE
1. OPEN MEETING
2. ACTION APPROVING AGENDA, WITH ANY AMENDMENTS
3. ACTION APPROVING MINUTES: JUNE 24, 2003 REGULAR MTG 1-2
• 4. CONSIDERATION/ACTION ON BIDS FOR DEMOLITION OF 2-4
FORMER LONGPRE BUII,DING
5. ACTION ON RESOLUTION DESIGNATING CERTAIN BUILDINGS 5-7
AS STRUCTURALLY SUBSTANDARD WITHIN DEVELOPMENT
DISTRICT NO. 1 (FORMER LONGPRE SITE)
6. STAFF REPORT BY FINANCIAL ADVISOR JIM PROSSER PROJECT, 8-9
WITH REQUEST FOR EXTENSION OF PRELIMINARY AGREEMENT
BY MOUND HARBOR RENAISSANCE
7. ADJOURN
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MOUND HOUSING AND REDEVELOPMENT AUTHORITY
JUNE 24, 2003
The Mound Housing and Redevelopment Authority of and for the City of Mound,
Minnesota, met in regular session on Tuesday, June 24, 2003 at 6:30 p.m. in the
council chambers of city hall
Members Present: Chairperson Pat Meisel; Commissioners Bob Brown, Mark Hanus,
David Osmek and Peter Meyer.
Others Present: City Attorney John Dean, City Manager Kands Hanson, City Clerk
Bonnie Ritter, Community Development Director Sarah €mith~ C4ty Planner Bruce
Chamberlain, Tom Stokes, Chuck Alcon, Roger Conheim, Mary~ljold, Paul Robinson,
Carolyn Krall, Cindy Reiter y
1. OPEN MEETING
Chair Meisel called the meeting to order at 6'30 p.m.
2. APPROVE AGENDA
MOTION by Brown, seconded by O~rtek to approve the agenda. All voted in favor.
Motion carried.
3. APPROVE MINUTES .;
MOTION by Brown, seconded~by Osmek to approve the minutes of May 27, 2003. All
voted in favor. Motion carried.
4. REPORT ON<fND1AN KNOLL .MANOR
Cindy Reiter of Westport Properties presented fie Manager's Monthly Report.
MOTION;;by Brown, seconded by Osmek to-approve payment of the May, 2003 bills. All
voted i~ favor. Motion carried:
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Reiter informed the HRA, that she is;in the process of getting quotes for a roof problem
and thate Special Needs and Physical Needs assessments are now taking place.
These area'HUD requirement.
5. RESOLUTION' MODIFYING TAX INCREMENT DISTRICT
MOTION by Brown,;-seconded by Hanus to adopt the following resolution. All voted in
favor. Motion carried'.
RESOLUTION N0.03-05H: RESOLUTION MODIFYING TAX INCREMENT DISTRICT
BY THE ELIMINATION OF PARCEL THEREFROM (Former Longpre Site)
6. PROJECT UPDATE BY MOUND HARBOR RENAISSANCE
Chair Meisel stepped down as Chairperson because she and her husband own property
within the redevelopment district.
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HRA Minutes -June 25, 2003
Tom Stokes reviewed MHR's accomplishments to date, followed by Roger Conheim
reviewing the residential market studies and Mary Bujold reviewing the office/retail/hotel
market studies. Paul Robinson followed with a report on the financial sources and uses,
and Carolyn Krall updated the HRA on concept plans and the timeline. Brown asked
about a date for ground breaking and Krall indicated that the soonest would be early to
mid-summer of 2004.
Stokes reviewed the request for an extension to the current developer's agreement.
John Dean stated that Jim Prosser of Ehlers & Associates indicated via memo that he
has not had a chance to finish his analysis and would like fo do this before the next
extension is determined.
MOTION by Osmek, seconded by Brown to extendrthe preliminary developer's
agreement until the July 8t" meeting so that further-:analysis can be cori~idered. The
following voted in favor: Brown, Hanus, Osmdk aid Meyer.- The following' doted against:
None. Meisel abstained from voting.
Meisel returned to Chair the remainder of the meeting;
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FRA
July 1, 2003
Mound Housing and Redevelopment Authority
City of Mound
5341 Maywood Road.
Mound, Minnesota 55364
SUBJECT: City of Mound
Longpre Building Demolition
MFRA #13314
Dear Mayor and Council Members:
• Enclosed is a tabulation of the five (5) bids received on May 21, 2003 for the Demolition of the
Longpre Building. The bids ranged from a low of $68,525.00, submitted by Landwehr Construction
Inc. of St. Cloud, to a high of $101,625.00. The Engineer's estimate was $90,500.00.
Landwehr is one of the older, reputable contractors in the St. Cloud area; therefore we are
recommending that a contract in the amount of $68,525.00 be awarded to Landwehr Construction,
Inc.
If you have any questions or need additional information, please contact us.
Sincerely,
MFRA
John Cameron, City Engineer
JC:jen
cc: Bonnie Ritter, City Clerk
HRA Secretary
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MOUND HRA
RESOLUTION N0.03-06H
RESOLUTION DESIGNATING CERTAIN BUILDINGS AS STRUCTURALLY
SUBSTANDARD WITHIN PROPOSED REDEVELOPMENT PROJECT
N0.1
BE IT RESOLVED By the Board of Commissioners ("Board") of the Housing and
Redevelopment Authority in and for the City of Mound, Minnesota ("Authority") as follows:
Section 1. Recitals.
1.01. The Authority has previously established Development District No. 1
("Project") pursuant to Minnesota Statutes, Sections 469.001 to 469.047 ("HRA Act"), and
intends to establish a redevelopment tax increment financing district within the Project
("TIF District").
1.02. Under Minnesota Statutes, Section 4 69.174, subd. 10(d), the Authority is
authorized to designate parcels as occupied by structurally substandard buildings prior to
demolition or removal of the buildings, and include such parcels in a redevelopment tax
increment financing district after demolition, subject to certain terms and conditions as
described in this resolution.
1.03. The Authority has determined a need to designate the parcel described in
Exhibit A (the "Designated Parcel") as stnacturally substandard prior to establishment of
the TIF District.
Section 2. Buildings Designated Substandard; Other Proceedings.
2.01. The Authority finds that the building on the Designated Parcel as described in
Exhibit A is structurally substandard to a degree requiring substantial renovation or
clearance, based upon the analysis of the building by LHg Engineers & Architects dated
on file in City Hall.
2.02. After the date of approval of this resolution, the building on the Designated
Parcel may be demolished or removed by the Authority, or such demolition or removal
may be financed by the Authority, or may be undertaken by a developer under a
development agreement with the Authority.
2.03. The Authority intends to include the Designated Parcel in a redevelopment
tax increment financing district, and to file the request for certification of such district with
the Hennepin County auditor within three years after the building demolition.
2.04. Upon filing the request for certification of the new tax increment financing
district, the Authority will notify the Hennepin County auditor that the original tax capacity of
the D esignated Parcel o n w hich a s tructurally s ubstandard b wilding w as d emolished or
removed before establishment of the district must be adjusted to reflect the greater of (a)
the current net tax capacity of the parcel, or (b) the estimated market value of the parcel
JBD-233808v1
MU195-2
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for the year in which the building was demolished or removed, but applying class rates for
the current year, all in accordance with Minnesota Statutes, Section 469.174, subd. 10(d).
2.05. Authority staff and consultants are authorized to take any actions necessary
to carry out the intent of this resolution.
Approved by the Board of Commissioners of the Housing and Redevelopment Authority in
.and for the City of Mound, Minnesota this 8~' day of July, 2003.
Chair Pat Meisel
ATTEST: Bonnie Ritter, City Clerk
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MU195-2 2
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o EXHIBIT A
That part of Lot 8, Auditor's Subdivision Number 170, described as follows: Beginning at a point
on the Westerly line of said Lot distant 50.65 feet North of the Southwest corner thereof; thence
North along the West line of said Lot to the Northwest corner thereof; thence Easterly along the
Northerly line of said Lot a distance of 40.1 feet; thence South parallel with the West line of said
Lot a distance of 60 feet; thence at a right angle East 10 feet; thence at a right angle South 5.5
feet, more or less to a point 50.2 feet North of the South line of said Lot; thence Westerly in a
straight line to the point of beginning; ALSO That part of Lot 8, Auditor's Subdivision Number 170,
described as follows: Beginning at the Northwest corner of said Lot 8; thence Easterly along the
Northerly line of said Lot a distance of 40.1 feet; thence South parallel with the West line of said
Lot a distance of 60 feet; thence at a right angle East 10 feet;- thence at a right angle South 5.5
feet, more or less to a point 50.2 feet North of the South line of said lot, said point being the
actual point of beginning of the trace of land to be described; thence continuing South along the
last described course 50.2 feet to the South line of said Lot; thence West along the South line of
said Lot to the Southwest corner thereof, thence North along the West line of said Lot a distance
of 50.65 feet; thence Easterly in a straight line to the actual point of beginning, including vacated
portion of road, adjoining the above described tracts. ALSO: Lot 4, McNaught's Addition to
"Mound", Lake Minnetonka, EXCEPT the South 29.3 feet thereof; including vacated portion of
road adjoining the above described property.
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FREERS
& ASSOCIATES INC .
0 To: Kandis Hanson, City of Mound
From: Jim Prosser & Sid Inman, Ehlers & Associates
W Date: July 2, 2003
Subject: Mound Harbor Renaissance
Ehlers & Associates has completed an analysis of the updated financial pro forma
information provided by Mound Harbor Renaissance (MHR). Our analysis concludes the
following:
^ MHR has provided detailed project cost estimates that appear to capture all
reasonably anticipated project costs including land acquisition, relocation,
demolition, site preparation, public improvements, site amenities and other
development related costs. In fact, it would appear that MHR estimates are more
highly refined than is typically seen at this stage of development.
^ The projection of development revenues includes land sale proceeds and projected
tax increment. The land sale proceeds are based on reasonable estimates for the price
of land given the type and value of proposed development.
^ Ehlers has not completed the analysis of tax increment projections based on the
updated development plan but expects to do so prior to the July 8 meeting.
^ MHR has updated the development program that details the type and value for
individual project components based on the market analysis. This updated
information increases the reliability of the project revenue projections.
^ The development plan that serves as the base of the financial pro forma appears
consistent with HRA targeted development guidelines and reasonable land use
projections.
^ The current project market value for the proposed developments is estimated at
approximately $98 million. This estimate is generally consistent with market
analysis prepared by Maxfield Research and Conhaim Associates.
^ There is currently a gap between the project sources (land sale proceeds and tax
increment) and uses (land purchases, public improvements, site work, etc.) of about
$5 million prior to developer profit.
LEADERS IN PUBLIC FINANCE
Jim Prosser, CIPFA
Executive Vice President/Director
3060 Centre Pointe Drive Phone: 651-697-8503 Fax: 651-697-8555
Roseville, MN 55113-1105 _8_ Email: jim@ehlers-inc.com
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Mound HRA -MHR Analysis
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Findings
MHR has provided the information required to complete a fmancial feasibility analysis for the
proposed development. The information is highly refined and reliable. The existence and
level of financial "gap" at this time is not unusual for a project of this size and nature. MHR
has complied with the requirements outlined by the HRA in the memo dated February 20,
2003.
Recommendation
Based on the information provided by MHR it is recommended that the HRA consider the
granting an extension to the Preliminary Development agreement for a period until September 9,
2003. During the time MHR and the Project Team would identify options to close the financing gap.
At the September 9 HRA meeting the options would be presented for discussion with the HRA.
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