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HomeMy WebLinkAbout1978/09/26 - ADMIN - Minutes - City Council - Joint1. 2. JOINT CITY Call to Order Ro 11 Ca 11 Conunissioner at 8:45 p.m. MINUTES COUNCIL HOUSING September 26, A j oint Housing called AUTHORITY 1978 MEETING meeting of the City Council and and Redevelopment Authority was :o order by Mayor Stern at 8:13 p.m. The following roll call: Councilmen were present at Ronald Backes Ly 1e Hanks Kei th Me land Irving The f ollowing were present Housing at roll Heltzer arrived at 8:15 p.m.; Martha Elstrom Jerrold Martin John Ralles S tern Authority ca 11: Jane Tschida Thomas Williams Joel Glotter Commi.s s ioners Commissioner Moylan arrived Also present were .the City Manager and the Executive Director. 3. Lanvesco Pro osal The Executive Director expl.ained that Lanvesco was issued a letter of intent for a 15elderl con�regate apaztment building f or the y � the receipt of additional in July contingent upon information including a more complete development plan. ro osal requesting Qn Sep tember 13, 19 78, Lanves co submitted � for sect ion 8 units, industrial public acquisition of the proPerty, supPor On ' and a lease back of the land to the developer. revenue bond�ng anves c the Cit received additional communicaeio�o osal and indus- September 20, Y . Section 8 funding is not necessary tO �lle pro ect feasible, s tated that to make P trial revenue bonding is not the only waY . ro ram funds •� rent subsidies and p g . h ' 1d as s is t in ob taining owever it wou for the project. The Executive Director stated acquisition of the property; t.o reduce initial development that there �o provide cos ts f or would be two reasons a write down f or the th e developer. �ar public project and Joint City Council Housing Authority minutes, September 26, 1978; Page 2 Lanvesco Cor oration, s tated th at Section 8 was Bill Schatzlein, P '' 11 sought for the program elements of the congraghousin�ng origlna y aspec�s of the praject and was not ini:enaede��nedethat the Section subsidy. He continued tha� it has been 8 rocess is very complicated so Lanvesco is.not purha�na tro�.mately P option any longer. He stated that it is eS aevelo ment andp the $5 million �aill be necessary for the total P developer is seeking a close working relationship weSh the City to determine financial figures and pro�ect feasibiliti Councilman Hanks wondered if th is proposal is part of the overall St. Louis Park housing program. Mr. Schatzlein indicated that these units would be market rate hous ing and there would only be an intra-subsidy on the morthegdeveloumenthwas industrial revenue bonding process. He added that t P not low income housing and would provide 100 units of elderly housing. There would be independent one-bedroom apartment units with a service package available to the residents to assist in day- to-day activities such as shopping, medications, meal provision, etc. He stated that the f acility would provide an alternative to nurs ing homes and cos ts are very reasonable relative to that of nursing care. He continued that there may be some ability to serve other elderly residents in the City through meal programs, recreational programs, e tc. In response to a question from Comm.i_ssioner Williams, Mr. Schatzlein indicated that �here would be a rental fee only and no original investment payment. He continued that industrial revenue bonding is being sought because reasonable rents would not amortize the deb� service with current interest rates for conventional financing. in addition, the chances of obtaining HUD funding are slim and the elderly housing complex does not meet St. Louis Park's hous ing goals. In respon5e to several questions from Commissioner Heltzer, Mr. Schatzlein indicated that a preliminary financial feasibility study has been completed by the mortgage underwriter; however, only a preliminary review of community demographics and need for this type of facility h ave been completed. He indicated that he is waiting for further Council direction before proceeding with an in depth market analysis. Co�ni.ssioner Heltzer requested information relative to what City costs would be necessary for food and boarding inspections. In r_esponse to a question from Councilman Elstrom relative to the five four plex b«ildings contained in the original concept proposal, `�r. Schatz]_ein indicated that at this time, he was not sure if these buildings would be included in the overall housing complex. �o�nt City Council Housin g Authority minutes, Septe�ber 26, �q 78 � page 3 Chairman Glotter stated that the Council and Authority must address the philosophical issue as to whether public financing tools should he applied to th -Cs type of proj ect and inquired as to why Mr . Schatzlein thought it was worthy of financial support. Mr. Schatzlein stated that he would be requesting tax exem�t mortgage notes which would require no City credit, and that the project provides . a viable an meaning ul alternative form of housing for the elderly while maintaining their health and well-being. He continued that there would be a savings in ter.ms of dollars and mental and physical well-being of those hous ed . He explained that the details of the service package has not been completed and he would attempt to utilize existing services in the community to avoid duplication. The City Manager stated that consideration should be given to any cost the City may incur through its public health nu�sing service for nursing care to the residents of the facility. Councilman Hanks stated that the Council has given a 60 day letter of intent to the developer, however not much progress has been achieved on the development plan to date. He wondered if any other developers were interested in this parcel of property. Mr. Schatzlein state d that many additional factors have been studied during the pas t 60 days and he would need an additional 30 days to analyze various details of the development. • Chairman Glotter stated that this pzoj ect would be an ill-use of taxes if the taxes would provide additional return on the developer's equity and would ask the developer to agree to certain controls and contingencies to set reasonable l�.mits on profit and return. Mr. Schatzlein stated that some control measures would be agreeable and he is not interested in windf_all profits; however, assistance is needed to make the projeGt feasible for the elderly population. It was moved by Cot�nc.ilman Backes, seconded by Counc�ilman Martin to extend the letter of intent for r�evel_opment by 45 days with the develo er_ to return with complete project information and analysis p , , g 1978. at the regular �oint meetin of October 24� Commissioner Heltzer stated that he has noL- seen any proof of t facilit in St. Louis Parlc a�d is interesaiafied he need �or such a Y u reviewin the financial feasibility sta�ement performed by q fiscal agents. He also wondered if this facility p rovides the bes t� g use of ert in ques tion and if this is the best use o the prop y industrial revenue bonding. Join� City Council Housing Auth�ority 4. minutes� SePtember 26, 1978; Page 4 �� Commissioner Tschida StfTeeinh aof community would be the g families although there is no way will actually occur. Councilma.n Ralles costs for service one possible benef_it to the single f amily houses f or younger to prove that this phenomenon s�ated thai: he is concerned with control of the associated with the facility. Commissioner He ltzer s tated that he would als o. like , on f or acceleraten regarding what imPact the'proposed federal leglslatl depreciation would have on this proj eci: . The motion passed 6-5--1 (Councilman Meland, Ralles, Hanks, Commissioners Heltzer and Williams opposed; Chairmann that theretwere insufficient votesncast. objected to the ruling of the Chair, i Proposal to Review of proposal by Charles Nasby, Reuse Tobacco Shop Associates, Inc. to reuse and expand the Tobacco Shop at 5300 Excelsior Boulevard. Pat Bestler, representing the Excelsior Boulevard Advisory Committee, stated thaL the Committee me� on September 18, 1978 to review the current proj ectis in i:he Excelsior Boulevard Redevelopment DistricC . She stated it was the concensus of the commattee that the Nasby Proposa�. is unacceptable and inconsistent with the overall redevelop- ment plan and the City should oonsider acquiring the property to be used for parking purposes for the Lilac Way area. � Chairman Glotter joint body not to to the parcel and goal. stated that he understood it was the premise of this purchase any property until a proj ect is committed purchasing this parcel would not accomplish this Mayor Stern stated that he viewed this premise as a co�i_t��t to risk capital funds for speculative purposes. not Charles Nasby e�lained that his company has purchased the property at 5300 Excelsior Boulevard and would like to use this structure as an office building and add a lea�to greenhouse to the structure � approximately 10 x 7 feet. The purpose of this greenhouse will be to show perspective buyers the product which he is marketing and a secondary purpose would be to illustrate an attractive solar collector. He continued that the cost of installation of this residential green- house will be $1, 200 -$1, 500. In response to a question from Counciiman Martin, the Execu�ive Director stated that the zoning for the area is PUD and the addition would need a special permit; the setback area would that there is no provision for this b uilding for the Excelsior Redevelopment District and must determine whether this project is a good adequate £or the redevelopment process. be adequate. He continued in the long-term plans the Council and Authority inter�mrlevelopment or not �► ,J�� nt �i�Y �ouncil Housing Authority minutes, September 26 197 • . � 8, Page 5 . �ommissioner He tzer stated that if , the City feels it is in a . . osition where it cannot approve this p • PrOJ eCt, i.t may have to decide to acquire the property in th�t it would be denying certain property rights to the property owner. Mayor Stern expressed concern in that if the City approved the project at this time, what would the consequences be if the property had to be taken for other projects later. Mr. Nasby stated that if the City would need the property for its proj ect, he would b e willing to negotiate acquis ition with the City as any other property owner in the dis tr ict . Chairman Glotter stated that it would be difficult to not let a private enterprise develop this property as long as it is not an obstacle to the long—term redevelopment goals. It was moved by Chairman Glotter, seconded by Councilman Elstrom to approve the concept of the reuse of the Tobacco Shop and allow Mr. Nasby to procede with the regular special permit application process. Councilman Meland s tated that the City should be aware that such an authorization may increase the value of this property which the City may need to acquire at a later time and would require relocation to another greenhouse which would not be a simple task. �_�o The motion failed�(Chairman Glotter and Councilman Elstrom in favor) . 5. Consulting The �xecutive Director explained that Services the City h�s b�en approached by a firm wishing to provide computer services to � t�ie City for f-inancial analyses of the development districts in the City. He stated that this would involve the Oak Park Village and Excelsior Boulevard Redevelopment District and is the computer service currently used by the League of Minnesota Municipalities. The City would be paying for computer usage only in terms of unit time and storage. The Executive Director continued that this service has been reviewed by �he Authority and should��ai�umaylbe a cos t s avings to th e Ci ty and exis ting te rminals in Ci ty t ime and used. The City would have the ability to run programs a�. any there is no re uirement for payment on days when the service is not q in use. In response to a ques t ion f rnm May or Stern, the Executive Direc�or st er service is identical to the one usudliizede ated that the comput ue service the City has League of Cities; however, the Leag . uter eq>>iPment to the in L-he pas t als o includes a cos � to br ing comp ' ersonnel f or interpretat ion and advice . Clty and for use of League p r, ncil Housing Authority minutes, September 26, 1978; Page 6 Joint City Cou � It was moved by Councilman rleland, seconded by to have statf prepare an indication °viewedaat preparation of the coni:ract to be re Councilman Ma.rtin rec�uested that the involved from the current consulting Councilman Elstrom costs and to authorize the next joint meeting. report reflect any savings service. Mayor Stern stated Lhat the new service should be used in conjunction with the existing League services. The motion passed 12-0. 6. Ec�nomic Development Director Chairman Glotter stated that the HRA has reviewed several options available for providing an economic deve lopment position as staff to the Authority. He continued that the Authority has selected an option which w ould allow the pos ition to be structured witihin the existing organization, and that the City would be able to use the personnel and refmburse the Authority for the services. T'he chairman of the West Suburban Chamber of Commerce Economic Development Committee stated that the chamber propos al is in con- ceptual f orm only and the Chamber is reques t ing a concept approval from the Council in order to proceed with a detailed plan; the con- cept has been approved by Hopkins and Minnetonka. Commissioner Tschida stated �hat the Authority did discuss the use of the Chamber of Commerce program in conjunction w ith the Economic Development position and perhaps the City would want to use the program f or other than redevelopment areas in the City. Mayor Stern stated as a compromise he would be willing to look at the Chamber proposal, however, he would advocate estab lishing the Economic Development position for an 18 month period to be reevalu- ated at th at time. The Chamber proposal could be a longer range program. Councilman Meland questioned how this Chamber program is different than the present function of the Chamber of Cotmnerce . The Chamber representative indicated that s ome of this function has been performed in the past, but the Chamber needs staff and expertise to do a better job. He continued that at this time no f inancial resources are available for an adequate program and th e City and Chamber should be partners in promotion. The City Manager stated that incorporating the position into the existing staffstructur e would realize a cost savings of 15 - 20 percent than if a person were hired and a separate department estab lished. � ,. ,loint City Council Housing Authority minutes, September 26, 1978; Page 7 Chairman Glotter explained if the position were incorporated in the . g� structure, t e HR.A would fund the entire position and the City could contract for services for other persons, He continued that option 1 would require the City to create a position and department t,o fund the pos ition and the HRA would contract f rom the City. Councilman Hanks stated that he position into the HRA structure City share of cost would be for pref erred the in�orporation of_ the however, inquired what the possible other servi�es . The Executive Director stated that one person could spend 35 percent of his time on redevelopment projects and the would have the ability to place emphasis on certain areas community for additional services. approximately Council of the Councilman Meland stated that the City Council is responsible for planning and orderly development within the City and would be concerned that a separate department. f or economic development providing problems for staff coordination; he could not support a plan where the City would have to compromise planning policies to attract development. It was moved by Councilman Martin, seconded by Commissioner Williams to approve the estab lishment of an economic development position within the HRA staff structure for a period of 18 months. The City Manager stated that Authority and City would not to make budget appropriation the division of labor between the be ne ces s ary but the Counc il would need to cover possible City costs. The motion passed 7-5 (Councilman and Commiss ion Heltzer opposed). 7. Adj ournment Afi tes t : Wendy go Recording Se cretary Backes; Hanks, Me land, Ralles Upon a motion by Councilman Hanks, se nded by Councilman Backes, the me�ing was adj ourned at 10 :17 p.� • �� w---- I ing M S Ce rn r