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HomeMy WebLinkAbout2002.04.09 PACKET CITY OF COTTAGE GROVE • ECONOMIC Secretary DEVELOPMENT AUTHORITY JOINT MEETING WITH CITY COUNCIL AGENDA TUESDAY, APRIL 9, 2002 7:30 A.M. 1. Call to Order 2. Roll Call • 3. Approval of March 12, 2002 Minutes 4. Business Items A. Project Updates B. 2002 Council Goals C. EDA Bylaws/Roles and Responsibilities D. Approval of Amended Development Agreement with Grove-Rainbow and Home Depot E. Senior Housing/Redevelopment/Streetscaping F. Training Center Update G. MEDP Broadcast H. Calendar 5. Miscellaneous Business Items 6. Adjourn Next Meeting Date: May 14, 2002 J:\Economic Development\EDA Packets\2002\AgendaskApril 9 Regular.doc City of Cottage Grove • Memo To: Economic Development Authority Members n• -1 From: Michelle Wolfe, Assistant City Administrator '` Date: 04/03/02 Re: Project Updates Item 4A Attached is the list of active projects. The City developed three new project files in March. This included an agency looking for office space, a restaurant pad, and a chain restaurant. In addition we continued to respond to follow-up requests for information on other active files. Staff will provide a verbal update regarding all current active leads at • the meeting. Attachment • \\CG_FS2\CG_FS2_MAIN\Groups\PER_ECON\Economic Development\EDA Memos\2002\April 02 Proj Update.doc ACTIVE LEADS QUERY EDA PACKET 4/4/02 Proposal ID Project Description SF/Acres Needed • ED-00-11 Retail/Wholesale 1-1.5 acres ED-00-22 Office Warehouse 45,000 - 50,000 sf warehouse, 4,000 - 5,000 office ED-00-31 Grove Plaza NA ED-00-32 Hotel & Restaurant 70,000 -80,000 sf ED-00-61 Retail/Mixed Use ED-00-64 Manufacturing/Distribution 8-10 acres ED-00-84 Multi-Tenant Spec. Building ED-01-002 Manufacturing ED-01-005 Manufacturing ED-01-006 Re- Development ED-01-010 Restaurant#2 ED-01-012 Restaurant#4 ED-01-018 Commercial ED-01-021 Remodel ED-01-024 Commercial 6.5 acres ED-01-026 Manufacturing- Medical 35,000 Sq. Ft. ED-01-030 Distribution 25-30 acres ED-01-032 Distribution 400,000 SF distribution center ED-01-033 Industrial ED-01-034 Distribution Center 9 acres ED-01-035 Project Future 60- 100 acres ED-01-036 Retail Store 2,000- 3,000 SF • ED-01-037 Multi-tenant Industrial 80,000 - 100,000 SF ED-01-038 Commercial 40,000- 50,000 SF ED-02-001 Manufacturing 80,000 SF ED-02-003 Industrial 10-12 acres ED-02-004 Office 2 acres ED-02-005 Light Industrial 5,000 ED-02-006 Mixed Use Commercial ED-02-007 Restaurant ED-02-008 Manufacturing ED-02-009 Steel Fabricator 20,000 SF ED-02-010 Restaurant ED-02-011 Restaurant ED-02-012 Office ED-02-013 Office ED-02-014 Office/Storage ED-02-015 Remodel • Page 1 City of Cottage Grove • Memo To: Economic Development Authority Members From: Michelle Wolfe, Assistant City Administrator � � V Date: 04/03/02 Re: 2002 Council Goals Item 4B Enclosed in the packets for EDA members are color copies of the 2002 City Council • Goals. The joint meeting will provide an opportunity to discuss the goals and the role the EDA can take in working towards achievement of them. • F:\Groups\PER_ECON\Economic Development\EDA Memos\2002\Apr 02 Calendar.doc • CIIID -,° 4i4 ,AGE GROVE 2002 CITY � : 4` ...J :. _AilA ,_,... - Commercial/Industrial Development Emphasis will be placed on quality retail and department store rt,., developments including restaurants, as well as continued emphasis on development of the Industrial Park. Planning for and implementing redevelopment of the Gateway North District with emphasis on development controls continues to be a high priority. a iTransportation and Transit Emphasis will continue to be placed on support of efforts to keep the Wakota Bridge/Highway 61 project on schedule. Increased emphasis will be placed on transit including Minneapolis express bus service and park and ride projects, and commuter rail planning • activities. Housing Development laced on creation will be placed r tion of Senior and move-up housing opportunities in an effort to provide for the full spectrum of life-cycle housing not currently available within the community. Public Facilities Emphasis will be placed on ensuring maintenance of existing buildings is adequately planned and funded. New emphasis will also be placed on planning for renewal of our park and recreation facilities and amenities, and also providing improved river access for the community. Operations Emphasis will be placed on ensuring the fiscal health of the municipal organization including strategically planning for significant reductions in debt-to-revenue ratios. City of Cottage Grove • Memo To: Economic Development Authority Members From: Michelle Wolfe, Assistant City Administrator (k Date: 04/05/02 1 Re: EDA Bylaws/Roles and Responsibilities Item 4C Attached is a copy of the EDA Bylaws as approved by the City Council at the December 19, 2002 meeting. The items the Council was asked to consider at the meeting were as follows: 1. Change the order of business to reflect the practice of the EDA. • 2. Amend the bylaws regarding the Executive Director position to state that the one "may" be appointed, not "shall" be appointed. 3. Add a section within Article IV mandating that all EDA strategic plans, work plans and projects receive Council ratification and/or approval. 4. Remove the requirement that the EDA President must be a member of City Council. The City Council approved the Bylaws with changes 1 through 3 above, but did not approve recommendation number 4. According to the Bylaws, any amendments must be adopted by the EDA and by the City Council. At this time, the EDA and the City Council have approved two different versions of the Bylaws. After the action at the December meeting, the EDA determined that they would like to hold off taking further action until there was an opportunity to discuss the Bylaws at a joint meeting. Therefore, this item is being placed on the agenda for further discussion by both parties. After discussion of the City Council goals and EDA Bylaws, and with the recent adoption of the EDA Strategic Plan, there is an excellent foundation to discuss the role of the Council and the EDA in achieving those goals. It is also known that various other City commissions will be involved in various aspects of accomplishing the goals and objectives. The joint meeting provides an opportunity to further clarify roles and responsibilities as they relate specifically to economic development goals. 1111 Attachment \\CG_FS2\CG_FS2_MAIN\Groups\PER_ECON\Economic Development\EDA Memos\2002\April 02 Bylaws.doc BYLAWS OF THE COTTAGE GROVE • ECONOMIC DEVELOPMENT AUTHORITY ARTICLE I-THE AUTHORITY Section 1. NAME OF AUTHORITY. The name of the Authority is the "Cottage Grove Economic Development Authority". Section 2. SEAL OF AUTHORITY. The seal of the Authority is in the form of a circle and bears the name of the Authority. Section 3. OFFICES OF AUTHORITY. The offices of the Authority are at the Cottage Grove city hall. Section 4. BOARD. The Authority is governed by seven commissioners (the "Board"), at least two of whom are members of the Cottage Grove city council. Section 5. STATUTORY AUTHORITY. The Authority is governed by the provisions of Minnesota Statutes, sections 469.090 through 469.1081 (the"Act"). ARTICLE II-OFFICERS , Section 1. OFFICERS. The officers of the Authority are the President, the Vice-President, the Secretary, the Treasurer, and the Assistant Treasurer. The Authority shall elect the President, Vice President, Treasurer and Secretary annually and they shall hold office for a term of one year or until their successors are elected and qualified. The Secretary and Assistant Treasurer need not be members of the Board. Section 2. PRESIDENT. The President shall preside at meetings of the Authority. The President shall sign contracts, deeds and other instruments made by the Authority. The President may submit recommendations and information concerning the business, affairs and policies of the Authority at any meeting. At the annual meeting, the President shall submit to the Board a report summarizing the activities and programs of the Authority for the past year and containing the President's recommendations for Authority activities for the ensuing year. The President shall be a Council member. Section 3. VICE-PRESIDENT. The Vice-President shall perform the duties of the President in the absence or incapacity of the President. In case of the absence or incapacity of the President or vacancy in the office of President, the Vice-President shall perform the duties of the President until a successor has been appointed and qualifies. No person may serve as President and Vice-President at the same time. Section 4. SECRETARY. The Secretary shall keep minutes of all meetings of the Board and maintain all records of the Authority. The Secretary shall have custody of the seal of the 1 • Authority and shall affix the seal to contracts and other instruments authorized by the Authority. The Secretary shall also have such additional duties and responsibilities as the Board may from time to time prescribe by resolution. Section 5. TREASURER. The Treasurer shall (i) receive and be responsible for Authority money; (ii) be responsible for the acts of the Assistant Treasurer; (iii) disburse Authority money by check only; (iv) keep an account of the source of all receipts, and the nature, purpose and authority of all disbursements; and (v) file the Authority's detailed financial statement with the Secretary at least once per year at the time set by the Authority. Section 6. ASSISTANT TREASURER. The Assistant Treasurer shall have the powers and duties of the Treasurer if the Treasurer is absent or incapacitated. The Assistant Treasurer shall deposit the funds in the name of the Authority in a depository selected by the Authority. The Assistant Treasurer shall keep regular books of account showing Authority receipts and expenditures and render to the Authority an account of the financial condition of the Authority. In the absence or incapacity of the Executive Director and Deputy Executive Director, the Assistant Treasurer, with the President, may sign contracts, deeds and other instruments made by the Authority. Section 7. EXECUTIVE DIRECTOR. The Authority may employ an Executive Director who shall exercise general supervision over the administration of its business and affairs. With the President, the Executive Director shall sign contracts, deeds, and other instruments made by the . Authority. The Executive Director shall be responsible for the management of the projects and general affairs of Authority, under the direction of the Board. The Authority may designate a Deputy Executive Director who shall perform the duties of the Executive Director in the absence or incapacity of the Executive Director and carry out other tasks as delegated by the Executive Director. Section 8. EMPLOYEES; SERVICES. The Authority may employ a chief engineer, other technical experts and agents and other employees as it may require, and determine their duties, qualifications and compensation. The city council may, by resolution, place any employees of the city under the direction and control of the Authority or may authorize any employee of the city to devote a portion of the employee's time to Authority duties and determine what reimbursement, if any, the Authority shall make to the city for use of its employees. The Authority may contract for the services of consultants, agents, public accounts and other persons needed to perform its duties and exercise its powers. The Authority may use the services of the city attorney or hire a general counsel for its legal needs. Section 9. ADDITIONAL DUTIES. The officers and employees of the Authority shall perform other duties and functions as may from time to time be required of them under these bylaws or by the Authority pursuant to resolution. Section 10. VACANCIES. If the office of President, Vice-President, Treasurer, Secretary or Assistant Treasurer becomes vacant, the Board shall elect a successor at the next regular meeting • or at a special meeting called for that purpose. The successor serves for the unexpired term of the office. 2 • ARTICLE III-MEETINGS • Section 1. ANNUAL MEETING. The annual meeting of the Authority shall be held on the second Tuesday in February at 7:30 a.m. at the regular meeting place of the Authority. Section 2. REGULAR MEETINGS. Regular meetings shall be held without notice at the offices of the Authority on the second Tuesday of each month, unless that date is a legal holiday, in which case the meeting shall be held on the following business day. Regular meetings shall commence at 7:30 a.m. but the time and place of a regular meeting may be changed by the Authority by resolution. Section 3. SPECIAL MEETINGS. Special meetings of the Authority may be called by (i) the Board by motion, or (ii) the President or two members of the Board by writing filed with the Executive Director who must then mail or deliver notice of the meeting to the members of the Board of the time and place of the meeting at least two days before the meeting. Section 4. QUORUM. Four members constitute a quorum of the Board for the purpose of conducting business,but a smaller number may adjourn from time to time until a quorum is present, and when a quorum is not present, a smaller number may adjourn the meeting. Section 5. ORDER OF BUSINESS. The following shall be the order of business at regular meetings of the Authority: • 1. Call to Order. 2. Roll Call. 3. Approval of minutes 4. Business Items 5. Other Business 6. Adjournment. Section 6. RESOLUTIONS: CONDUCT. Resolutions shall be in writing and placed in the journal of the proceedings of the Authority. Meetings shall be conducted in accordance with Robert's Rules of Order,Revised. Section 7. MANNER OF VOTING. Voting on questions coming before the Authority shall be entered in the minutes of the meeting. When a quorum is in attendance, action may be taken by the Authority upon a vote of the majority of the Board. Section 8. ATTENDANCE. Unexcused absence from three (3) consecutive regular meetings of the Authority or four (4) meetings in any calendar year shall be deemed to constitute a resignation of a member, and the vacancy thus created shall be filled thereafter. To be excused, an absence must be requested in writing by the affected member, granted by the Authority president (or, the vice president if the president makes the request) and the Executive Director and filed with the city clerk. Absences may be excused for extenuating circumstances that prevent the member's attendance, such as business demands, state of health, or personal • emergencies. 3 • ARTICLE IV—MISCELLANEOUS Section 1. FISCAL YEAR. The fiscal year of the Authority shall be the same as the city's fiscal year. Section 2. TREASURER'S BOND. The Treasurer shall give bond to the state conditioned for the faithful discharge of the Treasurer's official duties. The bond must be approved as to form and surety by the Authority and filed with the Secretary. The bond must be for twice the amount of money likely to be on hand at any one time, as determined at least annually by the Authority, provided that the bond must not exceed$300,000. Section 3. CHECKS. All Authority checks shall be signed by the Treasurer or Assistant Treasurer, and by the Executive Director or one other officer named by the Authority in a resolution. The check must state the name of the payee and the nature for which the check is issued. Section 4. FINANCIAL STATEMENTS. The Authority shall examine the financial statement together with the Treasurer's vouchers, which financial statements shall disclose all receipts and disbursements, their nature, money on hand, the purposes to which it shall be applied, the Authority's credits and assets and its outstanding liabilities in a form required by the city's • financial statements. If the Authority finds the financial statement and Treasurer's vouchers to be correct, it shall approve them by resolution. Section 5. REPORT TO CITY. The Authority shall annually, at a time designated by the city, make a report to the city council giving a detailed account of its activities and of its receipts and expenditures for the preceding calendar year, together with additional matters and recommendations it deems advisable for the economic development of the city. The Authority shall also submit a report to the City Council annually within 60 days of the anniversary date of the first adoption of the enabling resolution stating whether and how the enabling resolution should be modified. Section 6. BUDGET TO CITY. The Authority shall annually send its budget to the city council at a time fixed by the city. The budget shall include a written estimate of the amount of money needed by the Authority from the city in order for the Authority to conduct business during the upcoming fiscal year. Section 7. AUDITS. The Authority's financial statements shall be prepared, audited, filed and published or posted in the manner required for the city's financial statements. The financial statements shall permit comparison and reconciliation with the city's accounts and financial reports and shall be filed with the state auditor by June 30 of each year. Section 8. DEPOSITORIES. Every two years the Authority shall name a national or state • bank or banks within Minnesota as depositories. The Authority may deposit all its money in one bank account. Before acting as a depository, a bank shall give the Authority a bond approved as to 4 form and surety by the Authority. The bond must be conditioned for the safekeeping and prompt • repayment of deposits. The bond must be at least equal to the maximum sum expected to be deposited at any one time. Section 9. SUPPLIES, PURCHASING, FACILITIES AND SERVICES. The Authority may purchase the supplies and materials it needs. The Authority may use the facilities of the city's purchasing department. The city may furnish offices, structures and space, stenographic, clerical and other assistance to the Authority. Section 10. EXECUTION OF CONTRACTS. All contracts, deeds, and other instruments to which the Authority is a party or signatory or by which the Authority may be bound shall be executed by the President and the Executive Director or Deputy Executive Director or by such other officers of the Authority as the Board may by resolution prescribe. Section 11. APPROVAL OF PLANS AND PROJECTS. All Strategic Plans, work plans and projects initiated by the EDA must receive City Council ratification and/or approval. Section 12. AMENDMENT OF BYLAWS. These bylaws may be amended by the Board by majority vote of all the commissioners, provided that any such proposed amendment shall first have been delivered to each commissioner at least five days prior to the meeting at which such amendment is considered. These bylaws and any amendments thereto shall not become effective until adopted by the Board and approved by the city council. Adopted this day of ,2002. • President Executive Director F:\Groups\PER_ECON\Economic Development\EDA Bylaws\EDA Bylaws as Adopted by City Council 19 Dec 01.doc • 5 • City of Cottage Grove Memo To: Economic Development Authority Members From: Michelle Wolfe, Assistant City Administrator Date: 04/05/02 Re: Adoption of Amended Development Agreement with Grove-Rainbow and Home Depot Item 4D Attached are the following items for your review: • 1. Memorandum dated 3/22/02, from City Administrator Ryan Schroeder to City Council, regarding the Grove Plaza Redevelopment Agreement. 2. Proposed contract for Private Development By and Between Cottage Grove Economic Development Authority and Grove-Rainbow, L.P. (This is an amended version of the development agreement approved by the EDA last July.) 3. Memorandum dated 4/4/02, from City Administrator Ryan Schroeder to Mayor and City Council and Economic Development Authority. The original agreement was approved in July 2001. Since that time there have been enough changes that staff felt it necessary to obtain City Council and EDA approval of an amended agreement. City Council approval was obtained at the April 3 regular meeting. However, there were concerns voiced by the Council that are addressed in the attached memo dated 4/4/02. ACTION REQUESTED By motion, adopt the amended development and assessment agreements with Grove- Rainbow and Home Depot and the project scenario including streetscaping improvements within the development district. • Attachments \\CG_FS2\CG_FS2_MAIN\Groups\PER_ECON\Economic Development\EDA Memos\2002\April 02 Grove Plaza Dev Agmt.doc Office of the City Administrator • Memo To: Mayor and City Council From:Ryan R. Schroeder CC: Michelle Wolfe Date: 03/22/02 Re: Grove Plaza Redevelopment Agreement On July 26, 2001, Council adopted a resolution creating the Gateway Redevelopment tax increment district plan and program and a development agreement for the Grove Plaza shopping center. Both were adopted on 4-0 votes • (Councilmember Hale being absent). The development agreement was adopted at that time in an attempt to take advantage of legislation that provided TIF revenue stream advantages to projects put into place before August 1, 2001. However, since that time there have been a number of changes that have been required within the adopted agreement. These changes have been so many, and varied that we believe Council must revisit the agreement. We have enclosed a copy of the current draft of the development agreement for your review. The main body of the agreement continues to be the same as that adopted last July. Included is construction of a 94,785 square foot Home Depot store on a ten-acre land parcel. The minimum market value of that project will be $4,850,000 for taxes payable in 2004 and $5,775,000 for taxes payable in 2005 and beyond. In addition, the small tenant space remaining between the new Home Depot and the existing Rainbow stores will be rehabilitated. The resulting minimum market value for that approximate 10-acre parcel will be $4,363,333 for taxes payable 2004 and $5,045,000 for taxes payable 2005 and beyond. The City will be completing a regional storm pond adjacent to the existing vacant Burger King facility in accordance with the bid that Council awarded on March 20 for $339,498. Of that amount, $33,088 will be billed to Grove Plaza which amount is of direct benefit to Home Depot for their internal storm water utility lines that access this pond. Flemming Corporation (Rainbow) will be demolishing the Burger King facility • •Page 1 • precedent to our construction so that we can install utility lines from the pond to existing storm trunk in Point Douglas. This pond will provide for water quantity for Grove Plaza, Walgreen's and upstream properties. To provide assurance that the small tenant spaces are remodeled the City will allocate up to $500,000 on a pay as you go basis to Grove Plaza upon satisfactorily completing facade and streetscaping improvements. This payment will be made out of available increments only upon completion of the improvements. It is expected that these payments will approximate about $50,000/year over a ten year period in the year following completion of the improvements (without an interest burden). Grove Plaza will take over payments on the 1996-97 CGTAP program from 2003 through the end of its term in 2009. These payments average $27,442/year. Currently, this program is an obligation of the General Fund of the City. Not part of the development agreement but part of the District development plan is implementation of streetscaping improvements. Council has approved, as part of the Walgreen's development project, a monument sign located at 80th Street and East Point Douglas. Proposed is that that sign be replicated at the southeast quadrant of that intersection as well. Contemplated is that the second monument sign would provide a sign location for Home Depot and Hollywood Video. Also, on both this and the Walgreen's sign will be a location for designation of the Gateway North commercial district. The City will not be providing funding for either sign. • As part of the 80th Street reconstruction project, the City initiated a new street light standard and fixture. Part of the development plan is that these standards / fixtures be installed from the 80th Street intersection to the south at the location of the Super America station. Funds have been set aside for these improvements as well as banner ornamentation on the light standards. Walgreen's is expected to vacate their existing facility by June 30. Demolition of a portion of the shopping center will start shortly after that with the Home Depot open for business in April 2003. There currently is not any particular guaranteed timeframe for rehabilitation of the small tenant spaces. However, given the structure of the development agreement there is significant benefit to Grove Plaza by initiating that rehabilitation as early as practicable as their taxable market value rises regardless if the rehabilitation occurs. Council Action: By motion adopt the amended development and assessment agreements with Grove-Rainbow and Home Depot and the project scenario including streetscaping improvements within the development district. • •Page 2 Office of the City Administrator • Memo To: Mayor and City Council Economic Development Authority From:Ryan R. Schroeder Date: 04/04/02 Re: Grove Plaza Leasing/development At the meeting of April 3, 2002 Council approved the amended Grove Plaza redevelopment agreement. The EDA is requested to consider the same motion at their meeting of April 9, 2002. • During the Council consideration of this matter, concern was expressed that the agreement did not provide certainty that the small tenant space would be rehabilitated within any particular timeframe. While there is not a mandate within the document to meet a given schedule there is a great deal of incentive within the document to expedite rehabilitation of the Center. Included is: 1. Grove Plaza currently has a minimum assessment agreement at $6million. This project is splitting their property in half. The logical conclusion, therefore is an expectation that absent additional actions they could reasonably expect a reduction in market value to $3million. Under this agreement, however, their value will increase to $4,363,333 in 2003 and to $5,045,000 in 2004 (payable 2005). These values assume reconstruction of the small tenant space but the values increase regardless of the buildout. Hence, even if they do not remodel the space their tax bill will increase about$50,000 in 2005. 2. Under the agreement, they are taking over responsibility for the CGTAP program, which will cost them an average of$27,442/year for the years 2003 through 2009 (due in 2004 through 2010). While they are only responsible for this payment to the extent that the project generates tax increment, the Home Depot project will generate increment sufficient to cause the payment to be made. • Page 1 3. Not building out the small tenant space will cause a review of the default • provisions of the agreement. If Grove Plaza is found to be in default, even if tax increment has not been distributed, they are responsible to reimburse the City $400,000 in recognition of the regional storm ponding constructed on their property. 4. Should they need to sell or refinance the property the minimum assessment agreement will impact either financing or remarketing opportunities if the small tenant space is not rehabilitated. Additionally, I have been informed the KKE has been authorized to provide for final design and construction drawings for the small tenant space. They would not be going through this significant expense without intent to go forward. Of note is that demolition on the Burger King is expected to start during the week of April 8 as is pond construction. In addition, it is notable that the Home Depot closing is expected to occur around mid May, Grove Plaza is responsible for demolition expenses and retaining walls with money escrowed for both. With those significant investments, they have incentive to leverage the expense to the extent possible. A question was also raised by Council regarding their lack of preleasing activity. It should be noted that the rents that they can command with a Home Depot in hand is • much greater than without that (or even with the "possibility" that the Home Depot may be built). Hence, it would not be prudent for them to enter long-term leases at rates based upon the existing condition. Further, they cannot enter long-term leases without the consent of their lender. This consent would not be expected without something like Home Depot in hand. Finally, we have discussed issues of streetscaping and monumentation. Within that discussion, we had expressed a desire to construct a monument sign at Hollywood Video that replicates the Walgreen's monument. Apparently, the owner of Hollywood Video has provided his consent for a project, which will be funded by Home Depot. As a result of the above, I am quite confident that short of some catastrophic event the small tenant space will be built out within a reasonable time frame. While certainty is preferred in the process of horse trading through the redevelopment agreement this was an item we were not able to gain. Alternatively, we have gained a significant number of items. Included are: 1. $4million in additional tax value regardless of what happens on the site; 2. a regional ponding facility; 3. rehabilitation of the vacant Burger King site; • •Page 2 4. Grove Plaza taking responsibility for the cost of the regional pond should they • default on the agreement; 5. Grove Plaza taking over responsibility for the CGTAP program; 6. Probable reconstruction of the shopping center with the addition of a new anchor tenant; 7. Redevelopment of the Rose of Sharon site (Walgreen's had several years left on their lease within Grove Plaza but was encouraged to push for redevelopment of the Rose of Sharon site by Grove Plaza so that the Home Depot project could go forward. Without that encouragement that project may not be under construction today); 8. Funding sources to provide for streetscaping and monumentation enhancements for the Gateway North district. • • •Page 3 • City of Cottage Grove Memo To: Economic Development Authority Members From: Michelle Wolfe, Assistant City Administrator �V" Date: 04/05/02 Re: Senior Housing/Redevelopment/Streetscaping Item 4E Senior Housing Attached is a copy of an agenda item from the March 20, 2002 City Council meeting. Community Development Director Kim Lindquist summarizes the proposals received as • a result of an RFP process recently conducted. She recommended that several of the proposals be explored more in depth. This will involve a two-pronged approach. First, staff will meet and review proposals submitted by Duffy and Presbyterian Homes. Second, a task force group will interview candidates to obtain additional information regarding services, rental costs, site amenities, architecture and site plan considerations, etc. The task force will be made up of the City Council, Human Services Commission, and two members each from the Planning Commission and EDA. It is anticipated that these interviews will take place in the next month or so. ACTION REQUIRED Appoint two representatives from the EDA to serve on the senior housing task force. Redevelopment/Streetscaping During the joint meeting, staff would like to encourage discussion and receive input regarding the following topics: Gateway North Kohls Signs Streetscaping • Attachment \\CG_FS2\CG_FS2_MAIN\Groups\PER_ECON\Economic Development\EDA Memos\2002\April 02 redevelopment.doc REQUEST OF CITY COUNCIL ACTION COUNCIL AGENDA MEETING ITEM # DATE 3/20/02 !• PREPARED BY: Community Development Kim Lindquist ORIGINATING DEPARTMENT STAFF AUTHOR * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * COUNCIL ACTION REQUEST: Consider directing staff to proceed with the interview process with two senior housing providers for redevelopment of Cottage Square Mall. STAFF RECOMMENDATION: Direct staff to proceed with the interview process with two senior housing providers for redevelopment of Cottage Square Mall. BUDGET IMPLICATION: $N/A $N/A N/A BUDGETED AMOUNT ACTUAL AMOUNT FUNDING SOURCE ADVISORY COMMISSION ACTION: DATE REVIEWED APPROVED DENIED • ❑ PLANNING ❑ PUBLIC SAFETY 0 ❑❑ ❑❑ ❑ PUBLIC WORKS ❑ PARKS AND RECREATION ❑ ❑ El El HUMAN SERVICES/RIGHTS ❑ ❑ ❑ El ECONOMIC DEV. AUTHORITY ❑ ❑ ❑ ❑ ❑ ❑ ❑ SUPPORTING DOCUMENTS: ® MEMO/LETTER: Memo from Kim Lindquist dated 3/13/02 ❑ RESOLUTION: ❑ ORDINANCE: ❑ ENGINEERING RECOMMENDATION: ❑ LEGAL RECOMMENDATION: ❑ OTHER: ADMINISTRATORS COMMENTS: 111 it4., /1,11(61 City Administrator Date • * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * COUNCIL ACTION TAKEN: ER/APPROVED 0 DENIED ❑ OTHER • MEMORANDUM TO: Honorable Mayor and City Council Ryan Schroeder, City Administrator FROM: Kim Lindquist, Community Development Director DATE: March 13, 2002 RE: Senior Housing RFP Introduction In December, the City Council directed staff to develop a Request for Proposal (RFP)for senior housing in the community. Several sites were shown as potential housing locations: Cottage Square Mall, Langdon Square, 70th and Hinton, and the Armory property. The RFP provided some data about the community, census information addressing population and age, and market analysis work completed by Washington County HRA. . In total the City received five formal proposals. Additionally, staff has met with two other senior providers who heard about the City through the RFP process but did not submit a proposal. The following attempts to highlight the differing proposals however, each is fairly unique, mak- ing comparisons difficult. Staff has also included some information on the two other providers for a total of seven. Discussion LaNel Financial Group, Inc. Site: No particular site chosen; willing to work with City on any of the suggested sites. Product: Market rate senior rental building, approximately 80-100 units. Style: Three story apartment buildings with underground parking and villa units, which are townhouse style with attached parking. Services: Three different strategies on a continuum of services: active senior; independent living with some features for group or individual activities; and assisted care with meal programs housekeeping, health related services, and specialized care programs. Other Projects: 17 listed, examples include: The Rivers in Burnsville, Thomasville and the Arbors in White Bear Lake, and Calibre Chase, Heather Apartments, and Heather Assisted Living in Crystal. Financial: Rely on own equity lending and lending sources to fund projects along with whatever tax increment or city funding that may be available to assist the project. • Other: The developer for the project is an affiliated company of the management company for the rental project. Presently, together they own and manage over 2,100 senior housing units. Mayor, City Council, and Ryan Schroeder • ' March 13, 2002 Page 2 of 4 Accessible Space, Inc. • Site: No particular site chosen, willing to work with City on a portion of any of the four sug- gested sites. Product: Subsidized senior rental building, approximately 50 units. 49 units one bedroom with 1 two-bedroom unit for the caretaker. Rents are limited to 30 percent of the renter's ad- justed gross income. Style: Three story slab on grade construction. Services: 5 percent of units fully accessible, 2 percent designed to meet the needs of persons with visual and/or hearing impairments. All living units will be designed to accommodate the special needs of the elderly. Other Projects: ASI's ElderHousing Developments, 50 units in St Paul, 21 units in Rogers, 40 units in Sioux Falls, and 48 units in Great Falls, Montana. Financial: Financial information indicates that they require city dedication of the land. Other: Financial participation in HUD 202 program ensures that the rental costs will be 30 percent AGI for a 40-year period. CommonBond Communities Site: No particular site chosen, willing to work with City on which is favored site and is also dependent upon the product style chosen. Product: Proposing three alternatives: 4 Mixed-income senior project: 75-100 units; one bedroom, one bedroom with 4) den, and two-bedroom units; market rate with 20 percent shallow subsidy (50%-60% median income) 4 An affordable housing project for seniors: 50 units; 49 one-bedroom units with one two-bedroom unit for on-site caretaker; residency for low-income seniors, 62 years and older; income level $26,850 for one person household and $30,700 for two person household; rents limited to 30 percent of AGI 4 Senior campus incorporating both affordable and market rate housing. Style: Varies depending upon alternative chosen. Stand alone project will be three-story ele- vator building. Underground parking for mixed income building. Services: Incorporates "Advantage Center" which has service coordination, computers, a community building, and volunteer programs. Also available is the "home health collabo- rative" which provides personalized attention and access to short-term health care. Other Projects: CommonBond manages over 3200 units. Projects include Oak Ridge Com- munity in Hastings, Silver Lake Point in Mounds View, and Oak Terrace in Oakdale. Financial: The mixed-income project would be financed by selling tax exempt bonds. Addi- tional revenue sources, such as the City or Washington County HRA, may be necessary depending on the market rate rent levels and financial requirements of the development. The proposed affordable housing development would be financed through the HUD Section 202 program and no other public financing will be required. The Craig Company representing Auqustana Care Corporation They did not fully respond to the RFP, rather sending a letter expressing their interest in pro- • viding senior housing in the area. They have spoke to All Saints Lutheran Church about the Mayor, City Council, and Ryan Schroeder March 13, 2002 Page 3 of 4 • church's intent to facilitate senior housing. Presently developing an 80-unit independent senior housing project in Hastings. Duffy Development Company Site: Proposal indicates first choice for senior housing development is the Armory site. This preference is because of it's location within an existing residential neighborhood. If site acquisition and demolition probes difficult, their second proposal would be as lead de- veloper for the redevelopment of Cottage Square Mall. Product: Armory site, 60-90 market rate and shallow subsidy single-level cottages, for inde- pendent seniors. The majority of the units would be two bedroom with some one bed- room and some three bedroom. Cottage Square site would be 60-90 units of multi-level building with market rate and shallow subsidy units. Plan estimates 40,000 square feet retail and 50,000 square feet office totaling $21 million in market value. Style: Single-level cottage-style units at the Armory site. Multi-level building with retail on the first floor and two to four stories of housing above at the Cottage Square Site. Services: The projects would be primarily for independent living and therefore no services would be available. However, it is anticipated, should the Cottage Square site be cho- sen, that recreational facilities, such as fitness center, library, party room, and meeting rooms could be provided. Other Projects: List 11 similar residential projects including Lakeside Townhomes in Wood- bury,. Hidden Ponds Apts. In Apple Valley, and East Creek Carriage Homes in Chaska. Financial: TIF would be required for gap between purchase offer and land cost. Other: The applicant is prepared to work with the retail/office redevelopment of the Cottage Square site in conjunction with provision of senior housing. The developer has done both residential and commercial projects. Presbyterian Homes & Services (Pope Associates Architects) Site: Cottage Square Site Product: Senior campus project, which includes 60 units assisted living and 60 units inde- pendent living. Future phase of 40 unit assisted living. In the independent living project, total of 60 units with 30 one-bedroom and 30 two-bedroom units. Assisted living project, total of 60 units with 52 one-bedroom and 8 two-bedroom units. Style: Three story buildings connected to central 14,000 square foot "town center." Concept plan includes 20,000 square feet retail. Services: Similar projects provide the following for independent living projects: social program and events, scheduled transportation to shopping and outings, lawn care and snow re- moval. Optional benefits include housekeeping, dining, and access to town center fea- tures such as barbers, underground parking, Home Care facilities. Assisted Living would have health care facilities. Other Projects: Presbyterian Homes operates over 3,100 units: 322 Skilled, 886 Assisted, 1824 Independent, and 151 Townhome. Campus projects in Oak Park Heights (Boutwells Landing) Andover (Farmstead), and Inver Grove Heights (Summerhouse). Financial: TIF would be required for gap between purchase offer and land cost. Other: Developer willing to explore feasibility of retail/commercial component on site. Has project in Bloomington that has 88 units above a Walgreen's and other retail/service Mayor, City Council, and Ryan Schroeder • March 13, 2002 Page 4 of 4 spaces. Based upon preliminary discussions, the applicant willing to consider approximately 60,000 square feet retail/office. Other Contacts Two other senior housing developers have also spoken with City staff but did not formally submit a proposal. The first is Cooperative Services Group. They construct independent living condominiums. By using a HUD program they can provide a more affordable product to sen- iors, defined as persons over 55. There is not public subsidy needed. The second contact was with Silver Creek Real Estate Development LTD. They also are interested in the senior hous- ing condo market. I believe they are talking to John Tschida about the Zywiec property. Conclusion Staff would like to explore several of the proposals in more depth. Specifically, staff would like to meet and review the potential redevelopment of Cottage Square Mall with Duffy and Pres- byterian Homes. This would constitute a fact-finding mission to assess the level of public par- ticipation that would be needed to achieve the mixed-use redevelopment goals. From a process standpoint, staff would recommend a two-prong approach. A task force group would interview the two candidates to obtain additional information regarding services, rental costs, site amenities, architecture and site plan considerations, etc. Staff envisions that members of the City Council and the Human Services Commission, along with two • representatives from the Planning Commission and EDA be invited to sit on this panel. The other analysis will be through staff and relates to the economics of the project. This would be accomplished by the Economic Development and Finance staff. Staff believes the primary focus for the Council should be the redevelopment of Cottage Square. The provision of senior housing on the site and the creation of viable commercial/retail space addresses two of the Council's goals for the community. Given the amount of resources expected to achieve that goal, staff is not recommending pursuing any of the other applications at this time. However, staff will make the information available to other property owners interested in senior housing and facilitate any discussions regarding the provision of senior housing elsewhere in the community. Recommendation Direct staff to proceed with interview process for the Duffy and Presbyterian Homes proposal for redevelopment of Cottage Square Mall. • City of Cottage Grove • Memo To: EDA Members From: Michelle A. Wolfe, Assistant City Administrator Date: 04/05/02 Re: Cottage Grove Training and Education Facility Item 4F Progress continues on the training/education center. Today, the steering committee decided on the following name: "South Washington College Center." Plans have been drawn for space at the Cottage Square Mall. The August opening date appears very firm at this time. • One area where we have not been successful is soliciting input form the retail/small business sector of the communities. A morning breakfast event was scheduled to solicit this input, but was postponed due to low attendance. A survey regarding the interest level in the college center was sent out, but so far response has been low. One of the business retention action items in the economic development work plan was to try and have "neighborhood meetings" with city businesses to open a dialogue about the relationship between the city and the business community and what the city could do to help the businesses. I had hoped to try and tie these two items (the training center and the neighborhood meetings) together, and will continue to explore options along with the steering committee and Chamber. The steering committee will be meeting weekly for the foreseeable future to continue its work. It would be helpful for any members of the City Council and EDA to help spread the word about the SWCC throughout the community. • \\CG_FS2\CG_FS2_MAIN\Groups\PER_ECON\Economic Development\EDA Memos\2002\Apr 02 Education.doc • • City of Cottage Grove Memo To: Economic Development Authority Members From: Michelle Wolfe, Assistant City Administrator , 1\iisiXV) Date: 04/05/02 Re: Metro East Broadcast Item 4G Attached is a copy of the monthly newsletter from Metro East Development Partnership. Note that the MEDP golf tournament will be Monday August 12. The Metro East Development Opportunities Conference will be on Wednesday, April 24. • Attachment \\CG_FS2\CG_FS2_MAIN\Groups\PER_ECON\Economic Development\EDA Memos\2002\April 02 MEDP.doc TrBroadcastas The Metro East Development Partnership, in cooperation Even though there is still snow on the ground, it is not too ears with the Minnesota Real Estate Journal and the University think about swinging the sticks. The 5`h Annual MEDP of St. Thomas will be holding the Tournament will be held on Monday, August 12, 2002, at the Metro East Development Opportunities Conference Hastings Country Club. Those of you who have attended the on Wednesday,April 24, 2002, at the World Trade Center event in the past know what a fine course it is,but this year we have in Saint Paul. The conference will run from 8:00 a.m. to an added attraction. MEDP member Amcon Construction has built 23rd a brand new clubhouse and meeting center at the Hastings Country 12:00 p.m. and will be held on the Trade Center's 23 Club. floor. The first Metro East Connections event is slated for Thursday, Briggs &Morgan and Braun Intertec are the premier April 25,2002,for the City of Vadnais Heights and White Bear sponsors for the event. A representative from Briggs& Township. The event will include a tour of both communities and Morgan will make a presentation on key regulatory issues, will highlight development opportunities. The May Connections closing fee transactions and site inspection requirements. will occur on Thursday,May 30,2002,and will include a tour of Braun Intertec will be giving a presentation on new Oak Park Heights and Stillwater. To register for either of these environmental regulations,brown field remediation, and events,please contact Lena Jacobson at(651)265-2763,or email indoor air quality standards for new and existing buildings. her at jacobsonca medp.orp. MEDP welcomes Danny Queenan to its executive committee. MEDP board member Bob O'Leary,portfolio manager for Danny is vice president of development for Ryan Companies and St. Paul Properties will moderate the office market will complete the term of Tim McShane. Tim was recently roundtable. Representatives from Equity Commercial, promoted and his new position requires him to travel a great deal. Chesapeake Partners,United Properties,Welsh Companies, Congratulations to Tim and welcome to Danny. and Zeller Realty will answer questions and discuss the current and potential market for office and industrial space Guidant Corporation plans to more than double its 1.2 million in the East Metro. square foot campus in Arden Hills over the next 20 years. The Minneapolis Chamber is coordinating a trip to Denver to analyze MEDP executive director David Piggott will moderate the that community's recent economic development success and the business park roundtable. Representatives from the City of efforts to coordinate economic development activities on a regions basis. MEDP member Frauenshuh Companies has signed a Eagan, Progressive Real Estate, the City of Hugo,the City facilities management contract to mange over 300,000 square feet of Wyoming,the City of North Branch, and the Chisago of space in 26 buildings for Bremer Financial Corp. County HRA will discuss Greenfield opportunities and the current availability of build able space in the East Metro. MEDP member Dakota Electric recently celebrated its 12`h Annual Partners in Progress program. More than 100 city The conference will conclude with a keynote by Tom officials,chamber directors and economic development O'Brien of First Capital. He will discuss the process of professionals attended the event. working with public-private partnerships,recent sales in the market,why investors should buy, sell or hold, and trends in the East Metro real estate market. Real Estate credits are available for attending this conference. The Metro East Broadcast is a monthly communication from the Metro East Development Partnership. We would like to share your news with The conference space can accommodate 200 people, and other members of the Partnership. Please send your press releases to: we anticipate that the event will sell out. Please register early. The cost is $79. To register, contact the Minnesota Real Estate Journal at (952) 885-0815. We hope to hold MEDP this event annually. Please show your support for the East 401 North Robert Street, Suite 150 Metro by attending this event. Saint Paul,MN 55101 rillilli= (651)224-3278 fax(651)223-5484 www.medp.org • Volume III, Issue IIII, April 02 • • City of Cottage Grove • Memo To: Economic Development Authority Members From: Michelle Wolfe, Assistant City Administrator Date: 04/05/02 Re: Calendar of Upcoming Events Item 4H EDA Meeting/Joint Meeting with April 9 City Council • Chamber Board April 11 City Volunteer Banquet April 24 Chamber Spring Banquet May 3 EDA Meeting May 14 EDA Meeting June 11 Metro East Golf Tournament August 12 2002 Golf Tournament August 20 • \\CG_FS2\CG_FS2_MAIN\Groups\PER_ECON\Economic Development\EDA Memos\2002\Apr 02 Calendar.doc