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HomeMy WebLinkAbout3.1 Meeting Minutes 2020-08-11 EDA MinutesCITY OF COTTAGE GROVE ECONOMIC DEVELOPMENT AUTHORITY _ MINUTES Economic Development Authority (EDA) Meeting August 8, 2020 Pursuant to due call and notice thereof, a meeting of the Economic Development Authority was virtually held via Zoom at https://cottagegrovemn.zoom.us/i/91575887526 on the 8th day of August at 7:30 a.m. CALL TO ORDER The meeting was called to order at 7:30 a.m. by EDA President Bailey ROLL CALL Members Present: Myron Bailey, EDA President Chris Carey, EDA Member Steve Dennis, EDA Vice President Dan Myers, EDA Member Erin Pash, EDA Member Rachel Smoot, EDA Member Eric Thiewes, EDA Member Members Absent: None Staff Present: Jennifer Levitt, EDA Executive Director/City Administrator Robin Roland, Finance Director Christine Costello, Economic Development Director Matt Wolf, Economic Development Coordinator Others Present: None APPROVAL OF MINUTES 3.1 Approval of the June 30, 2020 Special EDA Meeting Minutes EDA Vice President Dennis motioned to approve the June 30, 2020 Special EDA Meeting Minutes. EDA Member Carey seconded. Motion passed unanimously (7 -to -0 vote). BUSINESS ITEMS 4.1 Economic Development Update/Business Inquiry Economic Development Authority — Minutes August 11, 2020 Page 2 of 5 Economic Development Coordinator Wolf gave an overview of the various projects that are currently occurring throughout the City of Cottage Grove as related to Economic Development. 4.2 9165 and 8991 West Point Douglas Road Appraisals Economic Development (ED) Coordinator Wolf presented an overview on the appraisal for 8991 and 9165 West Point Douglas Road that the EDA authorized at their June 9th EDA meeting. ED Development Coordinator Wolf explained State Statues that allows the EDA's to purchase properties. ED Development Coordinator Wolf continued to explain that the EDA has purchased properties in the past including in the Cottage Grove Business Park. ED Development Coordinator Wolf continued by stating that both 8991 and 9165 West Point Douglas Road are in the Langdon Village area. ED Development Coordinator Wolf provided a background on the Langdon Village and the proposed concept plan that was created by Stantec. ED Development Coordinator Wolf continued to explain that 9165 West Point Douglas Road is the former Majestic Ballroom site and is located on 9.27 acres of land and the building on the site is in a state of disrepair and not habitable. ED Coordinator Wolf stated that the building only constituted a nominal value to the overall site and market value the appraiser gave was a range of $1.6 million to $1.7 million for the site. EDA Development Coordinator Wolf then provided a n overview of the appraisal for 8991 West Point Douglas Road which is a single-family residence that sits on 1.8 acres of land and was built in 1965. The appraiser inspected the home and provided a market value of $306,000. Both properties are guided in the Comprehensive Plan for mixed-use which would allow for a combination of commercial and high-density housing. ED Development Coordinator Wolf explained the three approaches for appraisals and further explained that the sales comparison approach was used by the appraiser. ED Coordinator Wolf also explained that comparable land sales were used in both appraisals. ED Coordinator Wolf also provided a list of comparable land sales that have taken place in Cottage Grove as well for comparison. Also, a SWOT Analysis was shared with the EDA and cost concerns related to environmental and demolition work on each site. ED Development Coordinator Wolf continued by explaining the location of sites related to infrastructure costs and the extension necessary to serve both 8991 and 9165 West Point Douglas Road with City utilities. ED Coordinator Wolf also explained the option for a Redevelopment TIF District if the EDA wanted to take an aggressive approach towards redevelopment of the Langdon Village area. ED Coordinator Wolf further explained the details of a Redevelopment TIF District and the impacts of the process. ED Development Coordinator Wolf concluded that purchase of 8991 West Point Douglas could remain a single-family home but the purchase would fulfill the Langdon Village vision and purchasing the home now would reduce potentially significant more expenses if it was not on the open market; such as relocation costs. In regard to 9165 West Point Douglas Road it has sat on the market for an extended period of time and staff would like to receive feedback from the EDA on the direction for this site. EDA President Bailey opened discussion to the EDA. Economic Development Authority — Minutes August 11, 2020 Page 3 of 5 EDA Vice President Dennis stated that he had spoke with City Administrator Levitt regarding 8991 West Point Douglas Road and the proposed demolition costs associated with the site and provided the option of allowing our Public Safety department the use of the site for various training opportunities for fire and police instead of paying the associated demolition costs. City Administrator Levitt stated that the demolition costs could be reduced after environmental work was taken care of that use of such a structure for Public Safety would provide a valuable training opportunity. EDA President Bailey inquired about the comparison properties in the appraisals, and that one of the challenges to these sites is that they do not have access to City sewer and water, as the appraisal comparisons. EDA Present Bailey inquired if this played into the value that the appraiser gave for the sites. EDA Wolf stated that the appraisals did include a building and land adjustment in the reports, and that the comparison sites did have development taking place around them as compared to the Langdon Village area not having development. EDA President Bailey stated that he agreed with staff, that purchasing 8991 West Point Douglas Road was prudent at this time and agreed with EDA Vice President Dennis that if it could be used as a training opportunity for Public Safety that would be great. EDA President Bailey also commented that every design to date that they City has seen for road connectivity goes through this property so purchase and tear down makes sense. EDA President Bailey further explained that the EDA previously owned a home in the area in which they rented but unfortunately there were many issues and additional costs related to renting so the EDA has found that it is not cost effective for the EDA to serve as a landlord but instead to remove any structures. EDA President Bailey made note that it has been the City's practice in the past to acquire land in order to assemble parcels in the area for development and noted that the City and EDA own other parcels in the area. EDA President Bailey continued by stating that in the past when a parcel becomes available the EDA should to consider purchasing to put properties together for development. EDA President Bailey noted that he was not interested in spending $1.6 to $1.7 million for the Majestic Ballroom site, though if the EDA could get a lesser price once assessment of the environmental and demolition work was completed, purchase could be considered. EDA President Bailey stated that if the EDA or land owner was not interested in the reduced price it would be important to work with the Building Division to get the site remediated. EDA President Bailey continued that something has to be done with the site since there has been investment across Highway 61 at Menards, and that he would prefer the land to be empty/cleaned up at 9165 West Point Douglas Road, and that recommendation #2 on the screen preferred, then let property continue to sit on the private market and then have Building Division work on remediation of the site. EDA Member Thiewes inquired about the Redevelopment TIF District and whether if the properties were not sold within three years for redevelopment the EDA would lose the TIF District, but can another type of TIF District be used or do you lose TIF altogether. ED Development Coordinator Wolf stated that with a Redevelopment TIF District both sites meet the blight test but the City and EDA could tear down the buildings in advance with a resolution for demolition but per the regulations for a Redevelopment TIF District the EDA would have three years to find a developer and if in that three years a developer is not found the EDA would lose the ability to do a Redevelopment TIF District for the area. Economic Development Authority — Minutes August 11, 2020 Page 4 of 5 EDA President Bailey inquired if for example a Redevelopment TIF District was explored and we did not get a developer within the three year timeframe could we go to our legislators for an extension. Finance Director Roland stated that there is always that opportunity for an extension it's just whether legislation would be done in a timely fashion. It is important to note that if the Redevelopment TIF District didn't come to fruition there is always the use of other TIF Districts such as affordable housing. This does not eliminate the other forms of TIF. City Administrator Levitt shared that the Langdon Village concept plan does show the area for mixed use development and a TIF District would not be able to be used in the future if a Redevelopment TIF District was established a developer was not found, the TIF would no longer be available for mixed-use development. The Majestic site has some unknown environmental value making it hard to estimate the cost. EDA President Bailey stated that he was not interested in paying the current market value of the Majestic site, but if there is a lesser value the EDA could be open to considering. Finance Director Roland stated that if the EDA did not acquire the Majestic at this time due to site costs and market value that the use of a Redevelopment TIF District would still be avialble in the future. EDA President Bailey inquired if we able to go back to the person marketing the property at 9165 West Point Douglas Road and ask about the price and environmental work. City Administrator Levitt stated that the EDA could reference with a letter of intent before an offer is made since we would need to access the site to conduct a Phase I and Phase II environmental assessment to evaluate a potential offer for the site. We can clearly indicate an offer around the $850,000 mark but evaluate our risk and liability to the EDA and City once the environmental work is complete. EDAs Vice President Dennis referenced the master plan for Langdon Village and inquired how much of the area was still under private ownership and how many stakeholders would need to be involved in order to implement the Langdon Village plan. EDA Development Coordinator Wolf stated that he did not have the exact breakdown of ownership but stated that a more defined acreage could be shared with the EDA as well as the other challenges to the site. EDA Vice President Dennis stated that at the last EDA meeting he voiced his concern about the site and that there is tremendous risk since we do not know what potential contamination at the site and cleanup costs associated with the environmental work, and continued that it may be more appropriate for development at this site to be developer driven. EDA Member Pash stated that she agreed with the comments from both EDA President Bailey and EDA Vice President Dennis; and that the former Majestic building needs to come down but that it is a lot of money with a lot of unknowns. EDA President Bailey stated that he agreed and is not willing to pay the high price for the Majestic but would like to know what the environmental needs would be for the site because either the EDA or someone else will need to know what the cleanup costs are and right now it is too unknown Economic Development Authority — Minutes August 11, 2020 Page 5 of 5 EDA President Bailey stated even with the changing times with the economy and now with COVID-19 retail has been changing and the question will be is this area still appropriate for retail in the future. EDA Vice President made a motion to approve authorization and negotiations and environmental work for the purchase of 8991 Wet Point Douglas Road. And table option for 9165 West Point Douglas Road pending additional staff contact and review of cost factors and work related to environmental work on the site. EDA Member Carey seconded the motion. Motion passed unanimously (7 -to -0) PUBLIC HEARINGS 5.1 None OTHER BUSINESS 6.1 Calendar 6.2 EDA Comments EDA Vice President Dennis inquired about the Small Business Assistance grant on how funds were used. Economic Development Director Costello explained the timeline for the use the funds and stated when grant paperwork on the use of funds was received it would be provided in the EDA packet. EDA President Bailey referenced the Renewal by Andersen ribbon cutting for their expansion and the accolades give to the EDA, Council and staff on how well we were to work with and it was a humbling experience and neat to hear how great we were to work with. 6.3 Response to Previous EDA Comments WORKSHOP None AJOURN EDA Member Carey made a motion to adjourn. EDA Member Pash seconded. The meeting adjourned at 8:20 a.m. (7 -to -0 vote) Respectfully Submitted, Christine Costello Economic Development Director