HomeMy WebLinkAbout2016/07/18 - ADMIN - Minutes - Economic Development Authority - RegularIJFSt. Louis Park OFFICIAL MINUTES
M I N N E S D T A ECONOMIC DEVELOPMENT AUTHORITY
ST. LOUIS PARK, MINNESOTA
JULY 18, 2016
1. Call to Order
President Mavity called the meeting to order at 7:20 p.m.
Commissioners present: President Anne Mavity, Tim Brausen, Steve Hallfin, Gregg Lindberg,
Thom Miller, Susan Sanger, and Jake Spano.
Commissioners absent: None.
Staff present: Executive Director (Mr. 1-larmening), City Attorney (Mr. Mattick), Economic
Development Coordinator (Mr. Hunt), Community Development Director (Mr. Locke), Zoning
Administrator (Mr. Morrison), and Recording Secretary (Ms. Pappas).
2. Roll Call
3. Approval of Minutes
3a. Economic Development Authority Meeting Minutes June 6,206
.It was moved by Commissioner Brausen, seconded by Commissioner Spano, to approve
the EDA minutes as presented.
The motion passed 7-0.
3b. Economic Development Authority Meeting Minutes June 20, 2016
.It was moved by Commissioner Brausen, seconded by Commissioner Spano, to approve
the EDA minutes as presented.
The motion passed 7-0.
4. Approval of Agenda
.It was moved by Commissioner Lindberg, seconded by Commissioner Brausen, to
approve the EDA agenda as presented.
The motion passed 7-0.
5. Reports
5a. Approval of EDA Disbursements
It was moved by Commissioner Brausen, seconded by Commissioner Spano, to approve
the EDA Disbursements.
The motion passed 7-0.
Economic Development Authority -2- July 18, 2016
6. Old Business - None
7. New Business
7a. Issuance of TIF Revenue Note to Cedar Lake Rd Apartments LLC — Eliot
Park Apartments. Resolution No. 1617.
Mr. Hunt presented the staff report. He stated the EDA and the City entered into a
Contract for Private Redevelopment with Cedar Lake Road Apartments LLC on July 1,
2014, related to redevelopment of 6800 & 6720 Cedar Lake Road the former Eliot
School property and construction of the Eliot Park Apartments (now Siena Apartments).
Under the Contract, the redeveloper agreed to construct two apartment buildings with 138
market rate units between them, as well as two single family homes. In order to make the
project financially feasible, the EDA agreed to reimburse the redeveloper up to $1.1
million from tax increment generated by the project for qualified costs (such as
environmental remediation, building demolition, site preparation and underground
structured parking) incurred during the redevelopment of the former school property.
This reimbursement was to be provided once certain conditions had been met. These
conditions stated that a TIF Note would be issued when the redeveloper submitted to the
EDA documentation that sufficient qualified public redevelopment costs were actually
incurred by the redeveloper in connection with the project. Given that the redeveloper has
met the required conditions for issuance of the TIF Note, the EDA is being asked to
formally approve the issuance of the Note up to $1.1 million.
Mr. Hunt added that staff and the EDA's legal counsel recommended adoption of the
proposed resolution.
Commissioner Brausen asked if the increased tax revenue from the redevelopment will
provide for the tax increment payments to the redeveloper. Mr. Hunt stated that is correct.
Commissioner Brausen added that the property had to have a minimum assessed value of
$17 million, and in fact the property is currently assessed at $24 million, noting that that
should be more than enough of an increase in value to sustain payments under the note.
Mr. Hunt stated that is correct.
Commissioner Sanger asked about the two single-family homes at the property and
questioned how the city can ensure the second single-family home will be built this year,
and if there are other contractual requirements that must be met by the developer,
requiring the building of the second home.
Mr. Locke stated the redeveloper understands the obligations of the redevelopment
contract; however, the contract is clear that once the redeveloper had submitted sufficient
qualified costs, the EDA is obligated to issue the note. Mr. Hunt also indicated that if the
second home is not constructed by the end of the year, the city would notify the
redeveloper of the default under the contract.
Commission Sanger asked about the redeveloper acquiring the 18% rate of return on this
project and stated usually there is only a 10% rate of return, adding this seems to be a
very high rate of return. She asked Mr. Hunt for clarification. Mr. Hunt indicated that an
internal rate of return of up to 18% is what is allowed in the Lookback section of the
Contract and that is the same percentage expressed in other recent contracts as well.
Economic Development Authority -3- July 18, 2016
It was moved by Commissioner Brausen, seconded by Commissioner Spano, to waive the
reading and adopt EDA Resolution No. 16-17, the EDA Resolution authorizing the
Issuance of a Tax Increment Revenue Note, Series 2016 to Cedar Lalce Road Apartments
LLC.
The motion passed 7-0.
8. Communications
There were no communications
9. Adjournment
The meeting adjourned at 7.25 p.m.
Mel sa Kennedy, Secretary Anne Mavity, President