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HomeMy WebLinkAbout2002.08.13 MINUTES CITY OF COTTAGE GROVE • ECONOMIC DEVELOPMENT AUTHORITY MINUTES AUGUST 13, 2002 Pursuant to due call and notice thereof, a regular meeting of the Economic Development Authority was held at City Hall, 7516 80th Street South, Cottage Grove, Minnesota on the 13th day of August 2002. CALL TO ORDER The meeting was called to order at 7:30 a.m. by EDA President Wolcott. ROLL CALL Members Present: Jim Wolcott, EDA President Sandy Shiely, EDA Vice-President • Glen Kleven, Authority Member Fred Luden, Authority Member Dick Pederson, Authority Member Gerry Weingartner, Authority Member Mike Wennen, Authority Member Members Absent: None Others Present: Ryan Schroeder, City Administrator Michelle Wolfe, Assistant City Administrator Mathias Baden, South Washington County Bulletin Neil Belscamper, Recording Secretary APPROVAL OF MINUTES Kleven moved to approve the June 11, 2002 and July 9, 2002 Economic Development Authority Minutes. Weingartner seconded. Motion carried unanimously. PROJECT UPDATES Assistant City Administrator Wolfe stated that some of the projects on the active-proposals list would be going on hold status, and that the multi-tenant spec building was one of them. The Applebee's project was progressing. There had been a new inquiry for an office showroom, and different sites around the city were being considered. • Economic Development Authority- Minutes August 13, 2002 • Page 2 GATEWAY DEVELOPMENT DISTRICT Gateway Acquisition Update City Administrator Schroeder stated that the next items on the agenda concerned the Gateway Development District. At the last meeting the EDA had authorizad the purchase of the Bruhn property. Authority Member Kleven moved to approve the sale of the Bruhn property to Gene Stoltz. Authority Member Weingartner seconded. Motion carried unanimously. Authority Member Kleven moved to authorize the purchase of the pet hospital property in the amount of $297,735. Authority Member Weingartner seconded. Motion carried unanimously. City Administrator Schroeder stated that the City needs to acquire a few more properties associated with the project. The Economic Development Authority had already authorized the use of eminent-domain proceedings, and they would know shortly whether that process would need to be implemented. EDA President Wolcott asked what kind of timeline the eminent-domain process was on. City Administrator Schroeder replied that it would take 120 days after filing for a quick-take process, but that it might take more time if the public purpose was challenged. Gateway Grading/Lot Development • City Administrator Schroeder explained the new grading plan for the Kohl's/Hardwood Avenue projects. He added that the Parks Commission had been approached with the concept and a consensus had been reached in support of it. Authority Member Kleven asked for clarification on the Woodward property. City Administrator Schroeder stated that a two-story office condo was being considered for the property, with at-grade access to the second story from the north. EDA President Wolcott and Authority Member Kleven expressed concerns about access to the Burnett property. EDA President Wolcott asked where proceeds from the sale of the commercial pads developed in conjunction with the Kohl's/Hardwood Avenue Project would go. City Administrator Schroeder replied that proceeds from the sale would go into the Park Trust Fund. EDA Vice-President Shiely asked how much of Oakwood Park would be lost to development of the commercial parcels. City Administrator Schroeder said approximately five acres would be lost, adding that even without the commercial pads, three acres would have to be given up for the road project, and no further significant tree impact would take place with development of the lots. He commented that an added benefit would be the relocation of the playground equipment to a better area in the park Authority Member Weingartner moved to approve the grading plan. Authority Member Wennen seconded. Motion carried unanimously. Authority Member Kleven moved to approve the lot-development concept. EDA Vice-President Shiely seconded. Motion carried unanimously. • • Economic Development Authority- Minutes August 13, 2002 Page 3 Gateway et al TIF/Abatement Woodward Property Access Road City Administrator Schroeder stated that he was asking for direction on the EDA's funding preference for the access-road project to the Woodward property. He listed the available options as ED Trust Fund, TIF funding, lot-development proceeds, or creation of a tax-abatement project. He said the creation of a Tax Increment District for the project would be a reasonable use of that funding tool. His second choice was to use existing TIF revenues, and his third would be to use proceeds from development of the commercial lots. He handed out charts compiled by the Washington County depicting TIF usage within the County, they showed Cottage Grove as a relatively small user of TIF compared to other cities. EDA Vice-President Shiely asked whether assessments could be used as a means of financing the access- road project. City Administrator Schroeder replied that the Hardwood project had not been considered as an assessment project, and that that framework would have had to have been put in place some time ago. He said the access road to the Woodward property was outside the existing TIF district, but he did not recommend funding the access through the assessment process. He added that they were trying to relocate some of the existing condo tenants that were being displaced by the Kohl's/Hardwood project to that location. EDA President Wolcott said he would not be in favor of funding the access road through proceeds from the • sale of the new commercial lots. City Administrator Schroeder suggested using TIF funding for the proposed pet hospital project, as well as the Woodward property access road. He said he is not recommending TIF funding for the remnant parcels associated with the Kohl's project. He added that the Frattalone parcel should also be discussed at some point because of its aesthetic location along Highway 61. EDA Vice President Shiely asked what the relocation costs for the condo tenants would be. City Administrator Schroeder said costs for each individual tenant would vary considerably, noting that the dental office would have a much larger relocation cost than a general office location. He said it would cost approximately $200,000 for the relocation of all the tenants. Authority Member Kleven felt that the access-road project should be funded by the existing TIF revenue source, stating that it was being constructed as a direct result of the Kohl's project. He asked whether the existing revenue stream could cover the additional project. City Administrator Schroeder replied that it would be adequate under the current scenario. He said that if a new district were to be established, it would have to be done now, adding that the district could be abandoned if alternate funding was chosen. Authority Member Pederson asked for clarification on the life a new TIF district, and whether it would be considered an appropriate use to fund the access road. City Administrator Schroeder replied that redevelopment districts have a 25-year lifespan, and that the use would be appropriate. EDA President Wolcott stated that he would not be in favor of using Economic Development Trust Fund money or proceeds from the sale of the commercial lots to fund the road. Authority Member Luden asked why a new district should be established for the project. City Administrator Schroeder replied that the purpose would be to ensure an adequate funding source. Authority Member Weingartner said he was in favor of tying it into the existing project. Authority Member Kleven questioned whether the proposed project would be larger than just the displaced tenants. City Administrator Schroeder replied that it Aould be significantly larger. Economic Development Authority- Minutes 1111August 13, 2002 Page 4 Authority Member Kleven moved to approve the creation of a new TIF district as a funding source for the access road to the office condo project. Authority Member Weingartner seconded. Authority Member Luden said he felt the project was too strongly tied to the existing district. Authority Member Wennen agreed. Upon the vote being taken, the motion failed 3-4 (Shiely, Kleven, Pederson—Aye; Weingartner, Luden, Wolcott, Wennen—Nay). EDA Vice President Shiely moved to use the existing district as a funding source. Authority Member Weingartner seconded. Motion carried unanimously. Pet Hospital City Administrator Schroeder stated that a portion of the new pet hospital was being constructed for sole use by the City under the new animal impound contract, adding that the City would be contributing to the development cost of the land.A TIF district could be created as a funding mechanism for the project, and he asked whether the EDA supported such funding. EDA President Wolcott asked what the City's contribution would be. City Administrator Schroeder replied that the City's portion of the land development cost would be $29,265. Authority Member Luden asked what the • outcome of Council discussion on the topic had been. City Administrator Schroeder said Council had entered into the new impound agreement with the pet hospital, and had directed further funding discussion to the EDA. Authority Member Luden asked what the terms of the lease were. City Administrator Schroeder said the City was entering into a 20-year lease for the impound facility, and that the City pays for any unrecoverable impound fees. Currently, the City pays $5,000/year for the lease and approximately $25,000/year in unrecoverable fees. Under the new proposal, the City would be paying the 20-year amortized cost of the impound space, with the additional $29,265 br development of the land. EDA President Wolcott said he would be comfortable using TIF funding for development of the Frattalone parcel, but he did not feel it was an appropriate funding source for the new pet hospital. Authority Member Pederson moved to deny establishing a TIF district as a funding source for the new pet hospital. Authority Member Weingartner seconded. Motion carried unanimously. Frattalone Property Direction City Administrator Schroeder asked for direction on the Frattalone property. Authority Member Weingartner stated that he is in favor of using TIF funding for development of the parcel. Authority Member Kleven concurred, stating that he feels the current philosophy on the appropriate use of TIF funding relates to the development of this parcel. METRO EAST UPDATE Assistant City Administrator Wolfe stated that the Metro East Golf Tournament had been cancelled this year due to low entries. • • Economic Development Authority- Minutes August 13, 2002 Page 5 GOLF TOURNAMENT Assistant City Administrator Wolfe stated that she is still getting requests, and that there are currently two gold sponsors, nineteen silver sponsors, and three bronze sponsors. EDA President Wolcott stated that it would be a full tournament, and that someone should consult with the Golf Course Manager Bruce Anderson on how to keep groups from getting backed up on the tenth hole. Assistant City Administrator Wolfe said she was looking for pricing guidance for next year. EDA President Wolcott said the prices should remain similar to this year's tournament. GROVE PLAZA POND Assistant City Administrator Wolfe said the budget had been approved for the landscaping of the pond, and she was looking for EDA input. EDA President Wolcott felt that benches should not be place right along the roadway, and that the area next to the fueling station would be a more appropriate location. EDA Vice President Shiely said she had recently spoken with a citizen who had suggested using methods similar to Battle Creek in St. Paul to maintain a water level in the pond. City Administrator Schroeder replied • that the system used on Battle Creek could not be used in this situation. He added that in time the pond would silt in and hold some water, but that the outflows were placed such that it was not designed to maintain a high water level. PARK AND RIDE Assistant City Administrator Wolfe commented that agreements with the Met Council and MNDot were being developed for the new park-and-ride facility. The contract for construction was scheduled to be on the City Council agenda in December. EDA VACANCIES Assistant City Administrator Wolfe said three EDA terms would expire at the end of the year. She stated that an EDA member needs to be a resident or business person in the City, but that it wasn't expressly stated in the bylaws. Authority Member Kleven said the condition should be added. CALENDAR Assistant City Administrator Wolfe stated that the November EDA meeting would be on the same day as the general election. ADJOURN Authority Member Luden moved to adjourn. Authority Member Wennen seconded. Motion carried unanimously. • R- ;- s •miffed, i - p/ rlminictrativP . ecretary