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2000-08-08i Ji I I I &l, i,~l I ,1, HRA MINUTES - REGULAR MEETING - August 8, 2000 The Housing and Redevelopment Authority of the City of Mound, Hennepin County, Minnesota, met on Tuegday, Aueugt 8, 2000, at 6:00 p.m., in the Council Chamberg at 5341 Maywood Road, in said City. Those present: Acting Chairperson Mark Hanus; HRA Board Members: Andrea Ahrens, Bob Brown, and Leah Weycker. Absent and excused: Mayor Meisel. Also in attendance were City Manager Kandis Hanson, City Clerk Fran Clark, City Attorney John Dean, James Prosser of Ehlers & Associates, Bill Beard of Beard Group, Inc., Mound Visions Coordinator Bruce Chamberlain, and Recording Secretary Diana Mestad. Others present: Jo Longmire; Bruce and Patti Dodds; Amy Cicchese; Bill and Dorothy Netka; Lorrie Ham, The Laker; Peter Meyer; Thomas Walsh; Todd Warner; Jane Carlsen; Scott Picha; Jason Lawly; Bob Best; Ron Hiecmer, Rottlund Homes; Richard Palmitor, Rottlund Homes; Tim Whitten, Rottlund Homes; Bart Roeglin; Phil Mitchum; Tom and Amy Reese; Steve Wagner; Barb Robert; John Royer; Glenn Smith. Acting Chairperson Hanus called the meeting to order at 6:05 p.m. TAX INCREMENT FINANCING. 1.01 EXECUTIVE DIRECTOR'S REPORT. Pinky Charon, Executive Director, was not present. MOTION by Weycker, seconded by Brown with an amendment to pay any emergency bills, to table this item until the next HRA meeting. The vote was unanimously in favor. Motion carried. 4-0. 1.1 APPROVE MINUTES OF JULY 25, 2000. MOTION, by Brown, seconded by Weycker to approve the Minutes of the July 25, 2000 HRA meeting. The vote was unanimously in favor. Motion carried. 4- 0 1.2 BILL BEARD OF BEARD GROUP, INC. ON DOWNTOWN REDEVELOPMENT. Bill Beard addressed the HRA Board and stated that he was present to answer any questions. Mr. Beard provided the Board with a handout that recapped the numbers that brought Beard Group to their decision. Mr. Beard reviewed the numbers for the HRA. He stated there is a $13 million difference between the cost of building the project and the actual value of the finished project. Mr. Beard stated that the Beard Group has tried various ways to close the Mound HRA Minutes, August 8, 2000 gap between these numbers, but was not able to do so. Mr. Beard stated that the Beard Group is interested in moving forward with this project if the numbers can be worked out. Acting Chairperson Hanus stated that the public should be brought up to date on the current condition of the redevelopment program. Jim Prosser, Ehlers & Associates, stated that he would address this issue. Mr. Prosser stated that the redevelopment process includes the following steps: 1. Looking at developing a general concept. 2. Marketing the concept to determine the interest. 3. The development agreement phase. 4. The construction phase. Mr. Prosser stated that at each point in the redevelopment process, an assessment is needed to determine if the next phase can be started. The Mound Visions Plan is currently at the second phase and the Beard Group has determined it is not feasible to continue with the redevelopment as it is currently planned. The City Attorney asked Mr. Prosser for a recommendation about how the City should proceed at this point. The City Attorney stated that he felt that Mr. Beard had done a good job of summarizing the amount of work done to this point by a number of parties to try to make this work. Acting Chairperson Hanus stated that it is important to note that this is not an unusual occurrence in this type of a complex project. Acting Chairperson Hanus stated that he felt that the City could still try to work this project out with the Beard Group and that there was a need to determine what to do next. Acting Chairperson Hanus wanted to clarify for the public that no redevelopment agreements are currently in place with the exception of the agreement involving the hardware store. He stated that at this time, the door is somewhat open for those who wish to do their own redevelopment or to propose a different plan for the redevelopment. He further stated that if someone wished to propose using TIF funds for doing their own redevelopment, now is the time to speak to the City. Acting Chairperson Hanus also stated that proposals would still need to conform to the Mound Visions Plan. Board Member Brown stated that he was unhappy with the Beard Group's decision being made known at the last minute instead of having an ongoing discussion about this possibility. Board Member Weycker stated that this would allow an opportunity to redo the development plan and still work with the Beard Group to bring costs down. She suggested that there would now be an option for some businesses to redevelop on their own. It ,11 ii I I ,Bi, i,~l , B ,~, Mound HRA Minutes, August 8, 2000 Board Member Brown stated that he wanted other developers made aware of the potential to work with the City on this project. Mr. Prosser stated that he wanted to reinforce that this is not an unusual situation and that there is a standard course of action that has been proven to be effective. In terms of range, the City could consider everything from re-planning to just foregoing the redevelopment. Mr. Prosser's recommendation is to talk to other developers and to have them look at the basic concept and get their assessments. This would be an unofficial process and no proposals would be submitted. If some developers were interested in the project, they then would be invited to prepare formal proposals to present to the City. Mr. Prosser stated that it would be possible to skip some of the steps covered previously such as land cost, public improvements, etc. He felt this could be completed within a six month period and quite possibly the information would be available in 90 days. Mr. Prosser stated that because of the disruption to the businesses in the area, it is necessary to move quickly through this process. He felt that by week's end the next step could be identified and the process could be moved forward. Mr. Prosser stated that public input through an open house format at the time the new developers' information is available would be appropriate. He also stated that he felt that would be the time to ask the public to submit ideas for the redevelopment. Acting Chairperson Hanus asked for clarification of the timing for introducing new developers. Mr. Prosser stated that starting information discussions immediately would be best. He further stated that the Beard Group has a great deal of time and money invested in this project and will want to provide suggestions on how to proceed. Board Member Brown asked whether these would be the same developers that were involved at the beginning of the process. Mr. Prosser stated that at this stage the more developers the better, but experience in this type of a project is best as there is a need to reduce the time from the idea stage to the implementation stage. Ken Custer, Glass Plus, stated that he had heard that the figure of $18 per square foot of retail space needed to be brought down to $12 per square foot and asked Mr. Beard if retail space was not working with TIF as well as residential space. Acting Chairperson Hanus stated that this was a detailed question that would be discussed in the future. Mr. Custer stated that he would like to develop his site and he wanted to know how the numbers worked. Mr. Beard explained that they had broken the project apart to try to make the numbers work, but it did not help the situation. The City Attorney stated that on several occasions, the City had tried to separate the projects, but that the Beard Group was not able to do so. Mr. Beard offered to call Mr. Custer and go over the numbers with him. 3 I1 ,11 I I I il, l, il Ii ,~, Mound HRA Minutes, August 8, 2000 1.3 MOTION by Brown, seconded by Weycker with the amendment to add a forum for public input, to direct Staff to invite qualified redevelopers to review the Mound Visions Plan and assess the ability to proceed with it and to submit proposals for review along with the recommendation to invite the developers involved in the first proposal process along with any other interested developers. The vote was unanimously in favor. Motion carried. 4-0. DISCUSSION OF OFFICE OF STATE AUDITOR LETTER REGARDING WESTONKA SCHOOL DISTRICT PARCELS The City Attorney stated that he is working on this and does not have any new information to discuss at this time. He feels that before the City commits additional resources to this project, it would be best to see how the referendum is decided and to determine what the nature of interest in the level of development is. Board Member Ahrens stated that she was in favor of adopting the City Attorney's recommendation not to do anything further at this point. The Board Members agreed with this. 1.4 INFORMATION/MISCELLANEOUS. A. FYI: CITY ATTORNEY'S LETTER ON REFERENDUMS. B. FYI: DOCUMENTATION ON HOTEL REDEVELOPMENT CONTACTS. C. MEMBER REQUEST: RETYPED DOCUMENT FROM JULY 25, 2000 MEETING. D. ARTICLE: MULT-FAMILY OUTLOOK ADJOURNMENT: MOTION by Ahrens, seconded by Brown to adjonrn the meeting at 6:40 p.m. The vote was unanimously in favor. Motion carried. 4-0. Kandis Hanson, City Manager Attest: City Clerk 4