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HomeMy WebLinkAbout2004/03/01 - ADMIN - Minutes - City Council - Study Session OF OFFICIAL MINUTES T EOUIS CITY COUNCIL STUDY SESSION RK March 1, 2004 The meeting convened at 8.30 p.m. Councilmembers present were Phil Finkelstein, Paul Omodt, John Basill, Susan Sanger, and Mayor Jeff Jacobs. Staff present. City Manager(Mr. Harmening), Planning and Zoning Coordinator(Ms. Jeremiah), and Recording Secretary(Ms. Stroth). 1. Quadion Redevelopment Proposal & Request for Financial Assistance Ms. Jeremiah introduced Michael Noonan and Tim Whitten from Rottlund and George Sherman from Sherman & Associates to the Council. She would like to talk about ownership issues and stated that Quadion owned property on both the east and west sides of Wooddale including two single family properties. There are two single family properties that they are interested in acquiring. Ms. Jeremiah explained the two alternatives that Rottlund brought to the Planning Commission. Alternative 1 would include the two single family homes and Alternative 2 would not. She stated that by adding the four single family properties they would gain 18 additional town homes. By not attaining the properties, they would lose parking as the roadways would have to go around other properties. Ms. Jeremiah stated that there are stormwater issues that are now close to being resolved. Ms Jeremiah stated that progress has been made on the purchase of the remaining two single family homes. She added that there would be a financial gap of$800,000 if the single family properties were retained Ms Jeremiah explained that Sherman Properties had proposed twenty percent of the senior housing to be affordable housing which equates to 16 of the 80 units. She stated that Mr. Sherman had submitted his Tax Increment Financing application as well as his application to Hennepin County for funding. Mr. Sherman reported that even at market rate prices, the units would not support the cost of the project He stated that affordable units would be required to even apply for TIF. Mayor Jacobs asked what the gap would be if there were no affordable units and Councilmember Sanger inquired where they would get the money from Mr Sherman stated that the gap would be $1 million dollars. Mr. Harmening summarized that there would not be a lot of funding sources available to cover the gap and that Mr. Sherman would need to rely on TIF funds. Councilmember Finkelstein asked what the back up plan would be if they could not do the affordable units and Mr. Sherman replied that it would be up to Rottlund as he would have to step out. Councilmember Finkelstein stated that the Council had heard that there would not be a need for public money. Ms. Jeremiah stated that the redevelopment of the office building raises costs. Mr. Noonen felt the office building needs to stay. Councilmember Sanger inquired if senior rental housing could be put in its place. Mr. Noonen replied that it would be condominiums steered towards seniors. He stated that there will still be a gap due to acquisition costs. Study Session Minutes -2- March 1, 2004 Mr. Noonen stated that they could still go forward even if they did not obtain the single family homes on Oxford St. Mr. Noonen replied that there are three pieces to the project: the Oxford properties, senior housing, and the possibility of even going further with more TIF. Mr. Harmening felt the most pressing issue for Rottlund at the moment is the ownership of the single family homes. He reported that they have made very good progress with the two remaining homes and feels they are neanng an agreement. Mr. Harmening stated that the goal is to approve a preliminary plan in the middle of March for two different alternatives. Mr. Noonen explained that they would like Council support of Alternative 1 with Alternative 2 as a fall back measure. Mr. Noonen stated that they would like a timeframe on completing discussions on municipal funds for the project. He stated if after good faith efforts Alternative 1 was not approved they would move forward with Alternative 2 without the single family homes. He explained that the needed an approval on which they could rely as they are on a very tight timeframe. Councilmember Sanger clarified that Rottlund wished the Council to approve both PUD's. Mr. Noonen stated that he has wntten the contracts contingent upon three matters and that they have appropriate approval by the city and financial assistance. Ms. Jeremiah stated that this is dust the preliminary stage and it would still need to come back for final approval. Mr. Ruff stated that by approving both options it puts them at a disadvantage and would make it more awkward to negotiate. Councilmember Finkelstein inquired if this commits them to using TIF. Mr. Ruff replied that normally a project will either happen with TIF or not happen without TIF. Councilmember Finkelstein asked what happens if they move forward with Alternative 1 and then Council decides they cannot afford TIF. Mr. Ruff replied that the purchase agreements would be contingent on these factors. Mr. Noonen stated that redevelopment of the area is supported by the community and the community would rather see some redevelopment than none at all. Mayor Jacobs felt it all boiled down to how much nsk the Council is willing to go forward with Alternative 1. Councilmember Basil inquired if it was possible to develop a formula that would base TIF on the purchase price of the homes. Councilmember Sanger suggested a formula plus a cap, though she had concerns that would dnve up the purchase price. Mr. Ruff stated that they need to determine the amount of profit from the project and its relation to the amount of assistance from the city. Mr. Harmening stated that he needed to understand the rush and commented that Council is not required to vote on this on March 15`h. Jim Voss, Cresa Partners, stated the building they were moving into would close on April 1St and if they could not meet that deadline, they would not have anywhere to go and the project could not move forward. He stated that a sixty day requirement causes some serious problems for them. Mr. Noonen inquired if TIF is appropnate to acquire the properties. Councilmember Basill did not feel that TIF was not appropriate but the question remains of how much TIF. The Council agreed. Mr. Noonen stated that they could achieve the same end goal if they approved Alternative 1 with a time specific penod for municipal finance or with Alternative 2 with a commitment for Rottlund to work with the city on the same end result. Mr. Harmening had concerns that the end result may not be the same and their bargaining position may be compromised. He stated that he has told the single family property owners he would need a decision within a week. Mr. Harmening stated that further analysis is needed on the proposal and clarification of the amount of the gap. Study Session Minutes -3- March 1, 2004 Councilmember Basill would like to present Alternative 1 as the preferred alternative with Alternative 2 as a fall back along with a side agreement. Mr. Harmemng stated that a third approach would be to approve Alternative 2 with the intent of working towards Alternative 1 but that would have to come back for further approval. Mr. Ruff inquired what happened if Rottlund comes back with condos and Ms. Jeremiah stated that it does fit the plat Councilmember Sanger brought up condemnation and if it would be of assistance to Rottlund as well as lenders. Mr. Noonen did not feel that it would be necessary. Mayor Jacobs asked for staff to update them as soon as they get word on the two properties. He emphasized the need to see actual numbers for the TIF amount needed and asked Mr Ruff to review the proposal Councilmember Sanger would like to see an update at the next study session so that Council can discuss what amount is acceptable to the City Mayor Jacobs stated that there is a possibility of holding a special meeting on either March 22nd or 29`h 2. Communications Mr. Harmening updated the Council on the possibility of a future organizational development session/retreat. Mr. Harmening reported that the city's legislation bills have been heard in committee. Mr. Harmening gave an update on solid waste and stated that there is a large problem with overflowing garbage carts and approximately 20% of homes were not in compliance. He stated that a letter would be going out to residents to remind them of the ordinance requirements. Councilmember Sanger would like to see a warning notification placed on overflowing carts between now and when the letter is mailed out. Councilmember Omodt had concerns with uncollected waste and the odor it would cause. Councilmember Finkelstein asked for clarification on what the ordinance states on where carts can be placed Mr Harmening clarified that carts should be put in the resident's garage as well as certain places in the yard, but not in the street. Mr. Harmening reported that they received 112 applications for the Community Development Director position and he has narrowed it down to ten candidates. Interviews will be held on March 8` and 9th A meet and greet for the finalists will be held on March 16th from 8:30 to 9 00 a.m. 3. Adjournment The meeting was adjourned at 9:45 p.m. 51L,.-,2-- — . gjz_,_az_:ij__ . .# 6f ?C&(/*/CitClerk raYo Y