HomeMy WebLinkAbout2024/02/12 - ADMIN - Agenda Packets - City Council - Study SessionAGENDA
FEBRUARY 12, 2024
6:30 p.m. City council study session – council chambers
Discussion items
1. 45 min. Beltline Station Development Update – Ward 1
2. 60 min. Vision 4.0 process timeline and discussion
Written reports
3. Hennepin County Minnetonka Boulevard reconstruction project update (4023-7000) – Ward 1
4. Subordination and assignment of redevelopment contract – Zelia on Seven – Ward 2
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Meeting: Study session
Meeting date: February 12, 2024
Discussion item: 1
Executive summary
Title: Update on proposed Beltline Station Development - Ward 1
Recommended action: None at this time.
Policy consideration: None at this time. This report is for informational purposes.
Summary: During the Feb. 12, 2024 study session, staff will provide the background and an
update of the Beltline Station Development including where we have been, where we are now,
and what actions are needed to bring the major development to fruition. An overview of this
information is provided in this report.
Sherman Associates (“redeveloper”) seeks to acquire approximately 5 acres at the southeast
corner of CSAH 25 and Beltline Boulevard from the EDA and construct a major, mixed-use,
mixed-income, transit-oriented development immediately north to the Beltline Boulevard light
rail station with the following components:
•Seven-story mixed-use building with six levels of market rate housing (152 units) and
approximately 21,000 square feet of neighborhood commercial space.
•Four-story all affordable apartment building with 82 units and underground parking.
Including: 77 units at 60% AMI, five units at 30% AMI and 22 three-bedroom units.
•Five-story market rate apartment building with 146 units and underground parking.
•592-stall parking ramp, including 268 park and ride stalls.
The development will exceed the city’s inclusionary housing policy and the green building policy
requirements, and will comply with the city’s diversity, equity and inclusion policy.
The EDA and city council have previously approved and amended a purchase agreement, a
redevelopment contract related to the affordable components, and a redevelopment contract
related to the market rate/mixed-use components of the development. Additional
amendments to the contracts will be necessary prior to the redeveloper’s financial closing.
Financial or budget considerations: To enable the $142 million, transit-oriented development
to become financially feasible and secure private financing, the EDA and city council have
approved approximately $15.47 million in total financial assistance to be provided to facilitate
all components of the Beltline Station development. This assistance includes a variety of
sources. A detailed explanation of all financial assistance was provided in a July 24, 2023 report.
Strategic priority consideration: St. Louis Park is committed to providing a broad range of
housing and neighborhood oriented development.
Supporting documents: Discussion, Project Timeline
Prepared by: Jennifer Monson, redevelopment administrator
Reviewed by: Greg Hunt, economic development manager
Karen Barton, community development director; EDA executive director
Approved by: Kim Keller, city manager
Study session meeting of February 12, 2024 (Item No. 1) Page 2
Title: Update on proposed Beltline Station Development - Ward 1
Discussion
Background:
The Beltline Station Redevelopment site is located at the southeast corner of CSAH 25 and Belt
Line Boulevard and consists of 6.6 acres. Sherman Associates (“redeveloper”) owns
approximately 1.5 acres of the site and seeks to acquire the remaining 5 acres from the EDA.
The redeveloper plans to construct a major, $142 million, transit-oriented development with
the following components:
• Seven-story mixed-use building with six levels of market rate housing (152 units) and
approximately 21,000 square feet of neighborhood commercial space.
• Four-story all affordable apartment building with 82 units and underground parking. Of
these, 77 units would be available at 60% of Area Median Income (AMI), and five units
would be available at 30% of AMI. Additionally, 22 units would be three-bedrooms.
• Five-story market rate apartment building with 146 units and underground parking.
• 592-stall parking ramp, including 268 park and ride stalls required by Met Council.
The development will exceed both the city’s inclusionary housing policy requirements (Oct.
2021) and the city’s green building policy requirements (July 2020) which were in place at the
time Sherman Associates entered into a Preliminary Development Agreement with the EDA.
The redeveloper is pursuing LEED certification of the market rate and mixed-use components of
the development, and green communities for the affordable component. The redeveloper will
also comply with the city’s diversity, equity, and inclusion policy, even though this policy was
adopted several years after initial contract agreements. The redeveloper will also be utilizing
union labor throughout the development’s construction.
Site information and public infrastructure needs:
The subject site is located in the Triangle neighborhood immediately north of the Southwest
Light Rail (SWLRT) Beltline Boulevard Station. It is comprised of four tracts of land most of
which is owned the city’s Economic Development Authority as shown below:
Rendering of existing conditions at the development site
Study session meeting of February 12, 2024 (Item No. 1) Page 3
Title: Update on proposed Beltline Station Development - Ward 1
The development site consists of the following properties
• 4601 Highway 7 (owned by the EDA)
• 3130 Monterey Ave S (owned by the EDA),
• road right of way (owned by the EDA)
• 4725 Highway 7 (owned by Beltline Development LLC an affiliate of Sherman
Associates).
It has long been assumed that there would be numerous challenges redeveloping the subject
site given the wetland, high water table and known contamination as well as the number and
size of the utilities traversing the property. This assumption was borne out through due
diligence which verified that there are significant extraordinary costs associated with
redeveloping the site along with other required costs. These extraordinary site development
costs include but are not limited to, utility relocations (some of which are very large), wetland
mitigation, environmental remediation, shoring and other site work; all of which need to be
completed at the outset to make the site construction ready. Due to these extraordinary site
costs, the project has to be developed in a single phase, adding additional cost to the project.
To prepare the site for a major, mixed-use development, a number of public infrastructure
updates need to occur including:
• relocation of an existing 66-inch storm sewer pipe running north to south through the
site connecting storm water from north of CSAH 25 to Bass Lake Preserve, and creation
of a public storm trap.
• relocation of dual force sewer mains running underneath the former frontage road.
• reconstruction and redesign of the backage road to facilitate commercial and residential
traffic into the site.
• completion of Monterey Avenue South and the installation of new water and sewer
lines within the street.
• creation of a public plaza at the base of the pedestrian bridge staircase.
• installation of sidewalks and multi-use trails surrounding the site and
• installation of public streetlights
Rendering of proposed Beltline Station development
Study session meeting of February 12, 2024 (Item No. 1) Page 4
Title: Update on proposed Beltline Station Development - Ward 1
City Strategic Priorities:
The Beltline Station development furthers all five of the city’s strategic priorities, achieves the
vision and all of the goals and objectives that were envisioned by the EDA/City Council when
the request for proposals (RFP) was issued in 2017, and achieves many of the goals and
strategies identified in the city’s 2040 Comprehensive Plan.
• St. Louis Park is committed to being a leader in racial equity and inclusion in order to
create a more just and inclusive community for all.
o The development provides 82 all-affordable units, including five units available
at 30% AMI and 77 units at 60% AMI, including 22 three-bedroom units designed
for families.
o The development includes approximately 21,000 square feet of neighborhood
commercial space providing employment opportunities for Beltline Station
residents and the surrounding neighborhood.
o The redeveloper will be adhering to the city’s DEI policy goals and quarterly
reports and will adhere to federal disadvantaged business hiring goals pertaining
to the construction of the public parking ramp.
o Sherman Associates is committed to advancing equitable developments and
utilize their projects to advance social, racial, and economic equity. Specifics
regarding’s Sherman Associates commitment to creating equitable communities
is provided below.
• St. Louis Park is committed to continue to lead in environmental stewardship.
o The development exceeds the city’s Green Building Policy requirements as
amended July 2020. The redeveloper intends to use Enterprise Green
Communities as its design rating system for the all-affordable building (which is a
requirement of the LIHTC allocation) and intends to seek LEED Certification for
the market rate buildings. Both rating systems meet the requirements of the
green building policy. Specific sustainable features are outlined further in this
report.
o Sherman Associates developed, owns, and operates two, off-site, solar gardens
under Xcel Energy’s community solar program which it plans to access to offset
some of the Beltline buildings’ energy needs. Additionally, building tenants could
subscribe to Sherman’s solar gardens for their energy needs under the
community solar program.
o The redevelopment site contains contaminated soils which will be mitigated by
this development.
o The redevelopment site does not currently contain any stormwater management
practices, which will be addressed during construction.
• St. Louis Park is committed to providing a broad range of housing and neighborhood
oriented development.
o The development replaces a required surface parking lot for 268 park and ride
stalls into a more efficient and compact parking ramp, facilitating the
construction of a compact, mixed-use, mixed-income, transit-oriented
development immediately adjacent to the city’s Beltline Boulevard light rail
station.
Study session meeting of February 12, 2024 (Item No. 1) Page 5
Title: Update on proposed Beltline Station Development - Ward 1
o The development provides 380 new residential units for St. Louis Park, including
82 all-affordable units, with five units available at 30% AMI and 77 units at 60%
AMI, and 22 three-bedroom units designed for families.
o The development also provides approximately 21,000 SF of neighborhood
commercial space, creating opportunities for small businesses and employment.
• St. Louis Park is committed to providing a variety of options for people to make their
way around the city comfortably, safely and reliably.
o Beltline Station development provides for a signature transit-oriented
development at the Beltline Boulevard light rail station.
o Provides multi-use trails, sidewalks, bike lanes around and through the site to
create a development that is truly designed for people first, then bikes, transit,
and then cars per the goals of the city’s 2040 Comprehensive Plan.
o The development includes approximately 21,000 square feet of neighborhood
commercial space providing employment opportunities for Beltline Station
residents (and the surrounding neighborhood) which also reduces dependence
on motorized vehicles to get to work.
o Provides 268 park and ride spaces for the Metro Greenline Extension/Southwest
Light Rail to facilitate greater light rail ridership in the metro.
• St. Louis Park is committed to creating opportunities to build social capital through
community engagement.
o There was a robust public process for the planning of the Beltline Station area
and the rezoning process. Additionally, the redeveloper sought input from
community members on future commercial uses within the development and
amenities related to the affordable components.
o The site is designed to facilitate social building opportunities through
placemaking. The development includes pocket parks that are privately owned,
but accessible to the public for recreation and community building.
o Public art is required to be installed, and the community will be involved with
the process of artist and art selection.
A summary of all previous actions is provided in the table below, with more specific details
following.
Action Date
Vision for Beltline Blvd Station area completed. 2008 - 2011
Beltline Area Framework & Design Guidelines completed. June 2012
SWLRT Project Office and city begin work on a joint, mixed use development
concept for Beltline Station.
2013
The EDA acquired properties at 4601 Highway 7 & 3130 Monterey Avenue South. December 2013
City Council approved resolution authorizing submission of Congestion Mitigation
Air Quality (CMAQ) grant application to FTA for partial funding to construct a
parking ramp rather than a surface parking lot at Beltline Station to fulfill SWLRT
park and ride requirements.
November 2014
The Federal Government awarded the city $7.56 million to construct a park and
ride parking ramp with 531-stalls.
September 2015
Study session meeting of February 12, 2024 (Item No. 1) Page 6
Title: Update on proposed Beltline Station Development - Ward 1
Action Date
The EDA and Met Council submitted an amendment to the federal government
related to SWLRT to reduce the number of park and ride spaces at Beltline Station
from 531 stalls to 268 stalls. This request was approved in late 2016, and the
CMAQ grant award was accordingly reduced to $6.4 million
April 2016
The EDA distributed a request for proposals to prospective developers for the
Beltline Station Redevelopment Site.
July 2017
The EDA entered into a preliminary development agreement with Sherman
Associates to develop the Beltline Station site.
February 2018
The EDA provided a bridge loan to Sherman Associates to enable its purchase of
the former Vision Bank property to facilitate more than just transit parking on the
western side of the Redevelopment Site. Soon after, Sherman closed on the
property acquisition and the Met Council placed a transit easement over the
property restricting the property use to a public park and ride facility and requiring
268 park and ride spaces be available prior to revenue service of the SWLRT.
April 2019
The EDA and city approved the first amendment to the preliminary development
agreement.
June 2019
The EDA approved a subrecipient agreement with the Metropolitan Council which
specified the terms under which the CMAQ funds would be disbursed to the EDA.
October 2019
The EDA entered into a cooperative construction agreement with the
Metropolitan Council to construct the parking ramp
November 2020
The EDA discussed Sherman Associates financial assistance request and approved
a second amendment to the preliminary development agreement and received a
staff report outlining the details of the proposed Beltline Station development.
June 2021
The EDA received a report providing an update on the status of the development
and issues related to high ground water on-site
November 2021
Sherman Associates received a tax-exempt bond allocation of $13.7 million from
Minnesota Management and Budget (MMB) to help finance Beltline Station’s all
affordable component. The redeveloper has received several extensions to the
start date, which is currently anticipated to be mid-April 2024.
January 2022
The city council approved the comprehensive plan amendment. March 2022
The city council approved various vacation requests, a preliminary and final plat,
and a preliminary and final planned unit development for the Beltline Station
development.
April 2022
The EDA held a hearing regarding the issuance of the tax-exempt bond allocation
for Beltline Station’s affordable housing component.
May 2022
Sherman Associates submitted a building permit application for the all-affordable
building.
May 23, 2022
The EDA/city council approved the Beltline Station 1 TIF District and Beltline
Station 2 TIF District.
June 6, 2022
The EDA/city council approved the contract for private redevelopment for Beltline
Station 1 TIF District and the purchase agreement related to the land sale for the
complete development.
June 20, 2022
Sherman Associates closed on the affordable building’s bond financing. July 1, 2022
The EDA approved a first amendment to the purchase agreement pushing the
closing date back to June 30, 2023 to allow all parties time to finalize contracts.
December 5,
2022
Study session meeting of February 12, 2024 (Item No. 1) Page 7
Title: Update on proposed Beltline Station Development - Ward 1
Action Date
Sherman Associates signed term sheets with their lenders for the development‘s
market rate components. Closing was required to occur by June 30, 2023.
February 2023
The EDA approved an early start and right-of-entry on the affordable building site
to allow cleanup activities to commence prior to April 1, 2023 to preserve a DEED
clean-up grant in the amount of $418,547.
March 20, 2023
Sherman Associates began cleanup activities on the affordable building site. March 30, 2023
Sherman Associates submitted a building permit application and plans for the
market rate components.
May 5, 2023
The EDA received a report outlining a recommendation for an amended financial
assistance package to bring the development to fruition.
May 15, 2023
Sherman Associates submitted a building permit application and plans for the
mixed-use components.
May 18, 2023
The EDA approved an amendment to the property purchase agreement and
contract for private development related to the affordable components to move
the required closing date from June 30, 2023, to September 15, 2023
June 5, 2023
Sherman Associates submitted a building permit application and plans for the
parking ramp.
June 12, 2023
The EDA held a public hearing on an amendment to the purchase agreement. July 17, 2023
The EDA and city council approved an amendment to the purchase agreement,
and the Contract for Private Development related to the market rate and mixed-
use components of the development.
July 24, 2023
Sherman Associates and the EDA published legal notices to start the public bidding
process of the parking ramp.
July 27, 2023
Bidding closed on the parking ramp, and the lowest bid was approximately $5.7
million higher than estimated.
August 28, 2023
The Met Council considered the original ramp bid solicitation as proof that the
construction of the ramp commenced, thereby meeting the required start date of
Sept. 30, 2023 to preserve the $6.4 million CMAQ grant.
September 30,
2023
The city council approved a minor amendment to the PUD zoning district to
redesign the parking ramp’s façade, to reduce the construction costs of the ramp.
October 2, 2023
The EDA and city council approved amendments to the purchase agreement and
various contracts to extend the commencement and completion dates of the
development.
October 10, 2023
Sherman Associates and the EDA published legal notices to start the 2nd round of
public bidding process for the redesigned parking ramp.
November 9,
2023
The Met Council approved an amendment to the Cooperative Construction
Agreement with the EDA to increase their financial assistance to the public parking
portion of the ramp by $984,167 for a total contribution of $3,484,167.
December 13,
2023
Public bidding closed on the parking ramp. The lowest bid was submitted by
Donlar Construction for $20.2 million. The bid was approximately $1.7 million
higher than estimated in the redeveloper’s proforma.
January 20, 2024
The EDA and city provided a letter stating it will not declare Sherman Associates in
default since the expiration date of the contracts was January 31, 2024 to
preserve the development’s financing
February 5, 2024
Study session meeting of February 12, 2024 (Item No. 1) Page 8
Title: Update on proposed Beltline Station Development - Ward 1
Detailed summary of past actions:
2011: The city hired consulting firm LHB to develop a vision for the properties immediately
north of the future Beltline Boulevard light rail station. City council envisioned the area as a
major, mixed-use, transit-oriented development that would include public park and ride stalls
for the transit line. In December 2013, the EDA acquired properties at 4601 Highway 7 & 3130
Monterey Avenue South to facilitate the envisioned development.
November 2014: The council approved a resolution authorizing submittal of a federal
Congestion Mitigation Air Quality (CMAQ) grant for a structured parking ramp to be located
immediately north of the SWLRT Beltline Blvd Station platform in lieu of a large parking lot. The
EDA was subsequently awarded a $6.4 million grant through the Federal Transit
Administration’s (FTA) CMAQ program that is regionally administered by the Met Council.
September 2015: The Federal Government approved the CMAQ grant award and allowed the
State of Minnesota to include the CMAQ grant as part of the 2015-2019 State Transportation
Improvement Program. The city was awarded $7.56 million dollars to construct a 541-stall park
and ride at the Beltline Station Site.
April 2016: The EDA and Met Council submitted an amendment to the federal government
related to SWLRT to reduce the number of park and ride stalls at Beltline Station from 531 to
268. This request was approved in late 2016, and as result the CMAQ grant award was reduced
to $6.4 million.
July 2017: the EDA conducted a formal request for proposals (RFP) process to solicit transit-
oriented development proposals for the Beltline Blvd. Station Redevelopment Site. The EDA
determined Sherman Associates’ proposal most closely aligned with the city’s vision,
development objectives and preferred programming for the site. Subsequently the EDA, city
and Sherman Associates entered into a Preliminary Development Agreement (PDA) on February
5, 2018.
March 2019: Sherman Associates purchased 4725 Hwy 7 (which included the land, former Vison
Bank building, and relocation of the bank) for $3.64 million to allow the construction of a
mixed-use development on the corner of Beltline Boulevard and Highway 7. The property
acquisition allowed the EDA and the redeveloper to gain control of the property ahead of the
Met Council (which was looking to acquire it for the surface parking lot originally required by
the SWLRT project) and utilize it for construction of a parking ramp as part of a larger
development. To purchase the property, the EDA provided Sherman Associates with a $3.1
million bridge loan from the city’s Development Fund for a portion of the acquisition costs, and
the redeveloper provided $800,000 in equity and closing costs. Without this loan, Met Council
would have condemned the property for a transit parking lot and private development on the
site would have been prohibited by state law. To date, the redeveloper has repaid the EDA $2.1
million of the loan.
June 17, 2019: The EDA and city approved a first amendment to the preliminary development
agreement (PDA) extending it to June 30, 2020. Since then, the parties have been working
collaboratively on a joint development (site and building) vision for the site. Additionally, staff,
Ehlers (the EDA’s financial consultant), and Sherman Associates have been discussing all
Study session meeting of February 12, 2024 (Item No. 1) Page 9
Title: Update on proposed Beltline Station Development - Ward 1
development costs, financial feasibility, and the necessary level of financial assistance needed
to bring the multi-phase development to fruition.
October-November 2019: On October 21, 2019, the EDA approved a Subrecipient Agreement
with the Metropolitan Council which specified the terms under which the CMAQ funds would
be disbursed to the EDA. On November 2, 2020, the EDA entered into a cooperative
construction agreement with the Metropolitan Council under which the EDA committed to
constructing a multi-level parking structure on the 4725 Highway 7 property (in lieu of a surface
parking lot) just prior to the start of revenue service. Under the agreement the parking facility is
to provide 268 public park & ride stalls and is to be constructed in compliance with specified
federal requirements. Additional parking stalls may be included in the park & ride structure to
serve the larger mixed-use, transit-oriented development on the site. Those additional stalls
would need to be funded locally outside of the CMAQ grant. When the SWLRT project received
federal approval in 2019, the estimated cost to construct the Beltline parking lot and associated
infrastructure was $2.5 million. Per the cooperative construction agreement, Met Council
agreed to provide this $2.5 million to the EDA for public parking adjacent to the station.
The cooperative construction agreement also specifies that if the EDA fails to construct the
parking ramp, the EDA will be required to construct a surface parking lot per the federally
approved plans for southwest light rail. This parking lot would consume the entire western half
of the development site and would be owned by the EDA. This would significantly reduce the
overall project scope of what could be built on the property (see graphic below), and the
relocation and installation of major utility lines would still be required for any future
development on the eastern half of the site. In addition, the parking lot would retain a
permanent transit easement recorded on it precluding any future private development.
When SWLRT received federal approval in 2019, the estimated cost to construct the parking lot
and associated infrastructure was $2.5 million. Per the cooperative construction agreement,
Met Council will provide this $2.5 million to the EDA for public parking adjacent to the station.
Federally approved plan for parking lot
Study session meeting of February 12, 2024 (Item No. 1) Page 10
Title: Update on proposed Beltline Station Development - Ward 1
January 2020-June 2021: The EDA and Sherman Associates worked cooperatively to prepare a
financial assistance package necessary to construct the development. This included various
market studies related to residential and commercial rents, property appraisals, and
applications for grant assistance.
June 2021: the EDA and city approved an extension of the preliminary development agreement
with Sherman Associates to continue working on the parties’ mutual vision for the joint
development site. In the November 8, 2021 study session staff report, the EDA/council received
an update on the proposed Beltline Station Development outlining its various components.
January 2022: Sherman Associates received a tax-exempt bond allocation of $13.7 million from
Minnesota Management and Budget (MMB) to help finance the development’s all-affordable
component. This bond allocation enabled the redeveloper to obtain federal Low Income
Housing Tax Credits (LIHTC) which provide an estimated $7.98 million in equity for the project.
Together, these sources are providing approximately 86% of the funding for the all-affordable
building.
February – April 2022: Sherman Associates applied for a comprehensive plan amendment to re-
guide portions of the subject site from right-of-way and railroad to transit-oriented
development, a preliminary and final plat, and a preliminary and final planned unit
development. The comprehensive plan amendment was reviewed by the planning commission
on February 16, 2022 and was approved by city council on March 7, 2022. On April 4, 2022, the
council approved the first reading of an ordinance vacating various street, highway, alley, and
easement rights-of-way to prepare the site for redevelopment, approved the preliminary and
final plat, and approved the first reading of an ordinance approving a planned unit
development zoning district for the site. For more details on the overall development proposal,
refer to the April 4, 2022 staff report.
May 2022: The redeveloper submitted a vacation application to Hennepin County to vacate
portions of CSAH 25 along the northern portion of the site, which were originally approved on
May 2, 2022 and reapproved in October 2022 due to a technical error.
June – July 2022: On June 6, 2022 the EDA established the Beltline Station TIF District 1 and
Beltline Station TIF District 2; the legal mechanisms for providing tax increment financing for
the affordable housing and market rate components of the development. And, on June 20,
2022 The EDA and city council approved the purchase agreement with Sherman Associates for
the remaining 5 acres of the Beltline Station redevelopment site and the contract for private
redevelopment for Beltline Station 1 TIF District pertaining to the affordable component.
Sherman Associates completed a soft closing on the financing for the affordable building in July
2022, to preserve the low-income housing tax credit allocation. The redeveloper was originally
required to complete a final close on the all-affordable building’s financing by June 30, 2023,
however the redeveloper has received several extensions.
December 2022: The EDA amended the purchase agreement to require the redeveloper to
close on its acquisition of the EDA land no later than June 20, 2023 to coincide with the final
bond closing for the all-affordable components of the development.
Study session meeting of February 12, 2024 (Item No. 1) Page 11
Title: Update on proposed Beltline Station Development - Ward 1
February 2023: The redeveloper signed term sheets with its lenders for the market rate
components of the project.
March 2023: On March 20, 2023, the city approved conveyance of city-owned property at
Beltline Station to the EDA for subsequent conveyance to the redeveloper via a purchase
agreement. The EDA also approved an early start agreement and right of entry with the
redeveloper to allow cleanup activities to commence on the all-affordable building site by April
1, 2023. Cleanup activities began on March 30, 2023.
Between 2022-2023: EDA staff, the redeveloper and its team, the Metropolitan Council, Ehlers
(the EDA’s financial consultant), and associated legal counsels worked diligently to complete
complex contracts related to the market rate and mixed-use components of the redevelopment
along with the public-private parking ramp (including an amendment to the CMAQ grant
agreement, construction-related documents, and a reciprocal easement and operating
agreement (REOA) that specifies the long-term maintenance and operations of the ramp). The
REOA itself required over six months of weekly meetings and negotiations to arrive at a
mutually acceptable final draft.
May 2023: On May 5, 2023, building plans and permit application were submitted for the
market rate components, and on May 18, 2023 the building permit and plans for the mixed-use
component were submitted for review. The city’s Building and Energy department is ready to
issue the building permits for all components of the project, pending Sherman’s purchase of the
EDA’s property.
On May 15, 2023 the EDA received a staff report updating the proposed financial
considerations of the development, where staff and Ehlers, the EDA’s financial consultant,
recommended approximately $15.47 million in total financial assistance (which does not reflect
the $3 million land price reduction, of which approximately $2.84 million could potentially be
recouped by the EDA) to be provided to offset a portion of the site’s extraordinary costs and
facilitate all four components of the Beltline Station Development. The assistance would derive
from a variety of sources. As negotiated, Sherman Associates would purchase the mixed-use
and market rate housing property from the EDA for $3 million and the affordable housing
component property for $1.
June-July 2023: On June 5, 2023 the EDA approved an amendment to the purchase agreement
and contract for private development related to the affordable components to move the
required closing date from June 30, 2023 to September 15, 2023 to allow time for the required
public bidding process related to the construction contract for the parking ramp. On July 17,
2023, the EDA held a public hearing on the purchase agreement and associated business
subsidy. No members of the community spoke.
On July 24, 2023, the EDA approved the contract for private development related to the market
rate and mixed-use components of the development and amended the purchase agreement to
sell the property to Sherman Development for $3 million. The total amount of financial
assistance provided from the city to the redeveloper for all components of the project totaled
$15.47 million.
Study session meeting of February 12, 2024 (Item No. 1) Page 12
Title: Update on proposed Beltline Station Development - Ward 1
The EDA and the redeveloper published legal notices in the newspaper, online and via email to
start the public bidding process of the Beltline Station Parking Ramp, on July 27, 2023. On
August 28, two bids were received. The lowest bid was approximately $5.7 million higher than
anticipated in the redevelopers’ proforma.
Per Met Council construction of the ramp was required to commence by Sept. 30, 2023 in order
to retain the $6.5 million CMAQ grant. After the high bid was received, the Met Council notified
the city that it would consider the original ramp public bid solicitation as proof that
construction of the ramp had commenced, thereby meeting the required start date.
To reduce the costs of the parking ramp, the redeveloper and its architectural team proposed a
redesign of the exterior façade of the ramp, removing the perforated metal panels, but
maintaining a minimum of 60% class I materials on street-facing facades.
October 2023: On October 10, 2023, city council approved an amendment to the PUD to allow
the redesigned parking ramp and the EDA and city council approved amendments to the
purchase agreement and various contracts to extend the commencement and completion dates
of the development to allow for the parking ramp to be rebid, requiring Sherman Associates
purchase the EDA’s property and start construction no later than January 31, 2024.
November 2023: After the substantial redesign and required approvals, the parking ramp was
rebid on November 9, with the bid opening scheduled for December 14, 2023. During the pre-
bid meeting, several contractors requested the bid opening be extended to accommodate the
holiday season and allow them more time to put together competitive bid sets.
December 2023: The Met Council approved an amendment to the Cooperative Construction
Agreement, providing additional funding to the construction of the public parking stalls due to
construction costs increases and inflation. The Met Council increased its contribution to the
project by $984,167 for a total contribution of $3,484,167.
January 2024: The ramp bid opening occurred on January 23, 2024 and two bids were received.
The lowest bid was $20.2 million which was $3.5 million lower than the September 2023 bid,
but it is still approximately $1.7 million higher than what the redeveloper estimated in its
financial pro-forma for the development.
February 2024: The expiration date contemplated in the various contracts was January 31,
2024. However, the rebidding of the parking ramp caused a delay in the project timeline past
the January 31, 2024 expiration date. Since all parties continue to work cooperatively to bring
the Beltline Station Development to fruition, the EDA and city council approved a no-default
letter on February 5, 2024 stating that the EDA and city will not declare Sherman Associates in
default prior to May 31, 2024, allowing time for extensions to be approved by the EDA and city.
Financial assistance:
Redeveloper’s request for tax increment financing assistance: Sherman Associates conveyed
to EDA staff in 2021 that the Beltline Station development’s financial proforma exhibited a gap
preventing it from achieving a market rate of return sufficient to attract financing. To offset this
gap, Sherman Associates applied to the EDA for tax increment financing (TIF) assistance. The
Study session meeting of February 12, 2024 (Item No. 1) Page 13
Title: Update on proposed Beltline Station Development - Ward 1
EDA received a report on June 14, 2021 outlining Sherman’s application for TIF assistance and
the overall financial assistance warranted to address the site’s extraordinary costs and enable
the major, transit-oriented development to proceed.
Financial assistance for the Beltline Station development: To facilitate construction of the
entire Beltline Station development (affordable housing, mixed-use, and market rate
components), the EDA approved the following package of financial assistance which includes six
main components:
•Three Pay-As-You-Go TIF Notes
•Affordable Housing Trust Fund dollars
•Spending Plan tax increment from various TIF districts in the city
•Pooled tax increment from other TIF districts
•Forgiveness of the remaining balance of the bridge loan for the purchase of the former
Vision Bank property
•Purchase price of the land consistent with lender’s 2023 appraisals
Beltline Station development financial assistance summary:
Site
component
TIF Note
amount AHTF Pooled tax
increment
Bridge loan
forgiveness
Total
assistance
Beltline Station 1 TIF District (affordable component)
Affordable $1.44 million
26 years $618,238 $2.06 million
Beltline Station 2 TIF District (mixed-use, market rate & parking components)
Mixed-use $5.75 million
16 years $1,554,000 $997,000
$13.41 million Market rate
parking
$2.19 million
$2.90 million
16 years
10.84 million $1.55 million $997,000*
Total financial
assistance
$12.30
million* $618,238 $1.55 million $997,000* $15.47 million
*The EDA and city council voted to use pooled TIF to repay the majority of the loan forgiveness and a
land price adjustment down to reflect updated property values.
TIF Notes: Upon completion of the buildings and verification of the redeveloper’s qualified
public redevelopment costs, tax increment generated from the increased value of the property
will be provided to the redeveloper in Notes on a "pay-as-you-go" basis, which is the preferred
financing method under the city's TIF policy.
One TIF Note will be issued for the Beltline Blvd 1 TIF District. This TIF Note is associated with
the affordable component of the development and will be $1.44 million. It is projected that the
TIF Note would be paid off in approximately 26 years with tax increment generated by the
affordable housing component.
Two TIF Notes will be issued for the Beltline Blvd. 2 TIF District. The first TIF Note, associated
with the mixed-use component and the city’s contribution for the parking ramp will be $5.75
million and will be paid off in approximately 16 years. The second TIF Note, which is associated
Study session meeting of February 12, 2024 (Item No. 1) Page 14
Title: Update on proposed Beltline Station Development - Ward 1
with the market rate component and parking, is $5.09 million and would also be paid off in
approximately 16 years.
A TIF “pay-as-you-go” Note means the redeveloper will pay its full semi-annual tax payments to
the county. Then, the taxes attributable to the property’s original base value will be paid to the
city, county, and school, while the increment (amount of taxes paid above the base value) will
be paid back to the redeveloper to reimburse it for a portion of its redevelopment costs. For
more detailed information on tax increment financing, please see the city’s TIF 101 handout.
This method of tax increment payment eliminates any financial risk to the city. If the
development generates more increment than anticipated, the TIF Note obligation is paid off
sooner. If the development generates less increment than anticipated, the redeveloper only
receives the increment generated. No EDA or city funds are used to pay TIF Note obligations.
Affordable Housing Trust Fund: The EDA and city will provide a deferred loan for $618,238
from the Affordable Housing Trust Fund (AHTF) to facilitate five units affordable to households
earning 30% of AMI within the affordable building. This loan will be paid back within 25 years. If
Beltline Station Limited Partnership sells, refinances or resyndicates the affordable housing
building prior to the deferred loan being repaid, it will be required to repay the deferred loan in
full plus interest.
Spending plan tax increment: The EDA will provide $1.55 million in spending plan tax
increment to fund a portion of the mixed-use component of the development.
What is spending plan tax increment? In 2021, the Minnesota Legislature provided temporary
authority to cities and EDAs to utilize unobligated tax increment from existing TIF districts in the
city to further stimulate private development that would not otherwise commence without
such assistance, provided the private development creates or retains jobs, including
construction jobs. On December 5, 2022, the EDA and city council approved a spending plan to
utilize unobligated tax increment to provide financial assistance to incent private development
in the city. The funds must be used to fill a gap in a project’s financing and are required to be
spent by December 31, 2025.
4725 Hwy 7 bridge loan: In 2019, Sherman Associates purchased 4725 Hwy 7 (which included
the land, former Vison Bank building, and relocation of the bank) for $3.64 million to allow the
construction of a mixed-use development on the corner of Beltline Boulevard and Highway 7.
The property acquisition allowed the EDA and the redeveloper to gain control of the property
ahead of the Met Council (which was looking to acquire it for the surface parking lot originally
required by the SWLRT project) and utilize it for construction of a parking ramp as part of a
larger development. To purchase the property, the EDA provided Sherman Associates with a
$3.1 million bridge loan from the city’s Development Fund for a portion of the acquisition costs,
and the redeveloper provided $800,000 in equity and closing costs. Without this loan, Met
Council would have condemned the property for a transit parking lot and private development
on the site would have been prohibited by state law. To date, the redeveloper has repaid the
EDA $2.1 million.
The Met Council has subsequently recorded a permanent transit easement over Sherman’s
property, requiring it to be used for 268 public park and ride stalls for the Metro Greenline
Study session meeting of February 12, 2024 (Item No. 1) Page 15
Title: Update on proposed Beltline Station Development - Ward 1
Extension/Southwest Light Rail. Should the parking ramp not be constructed, the EDA is
contractually obligated to construct a 268-stall parking lot on the entire western portion of the
development site.
From an appraisal standpoint, the permanent transit easement removes nearly all value of the
property. Given that the property is essential for construction of the structured parking ramp
that serves the parking needs of both the transit and the development, it is reasonable for the
EDA to incur a portion of the cost to purchase this property to facilitate greater density of the
entire Beltline site and advance the city’s strategic priorities.
The EDA has agreed to utilize pooled tax increment to pay the remaining $997,000 balance of
the bridge loan provided to the redeveloper.
Purchase Agreement: As part of its financing due diligence, Sherman’s lenders commissioned
an appraisal of the EDA’s property which provided a value of $3.39 million given the site’s
contamination and necessary utility relocations and refused to underwrite a higher purchase
price. The EDA subsequently agreed to sell the property for the market rate components to
Sherman for $3 million and the property for the affordable component for $1. Together these
sale prices more than reimburse the EDA for the costs of acquiring and holding the property.
Additionally, the EDA agreed to transfer $390,000 in pooled tax increment to the Development
Fund in order to compensate itself for the remaining $390,000 land value reflected in the
lender’s appraisal.
In addition, all property that is privately owned but located within public right of way, will be
quit-claimed back to the city for public ownership and use.
Summary: The EDA and city council voted to provide the financial assistance package as
outlined above on July 24, 2023 as the development provides numerous public benefits and
makes it possible to:
•provide a compact, mixed-use, transit-oriented, mixed-income development for the
City of St. Louis Park, including a vertical structured parking ramp, instead of a large
surface parking lot at a key intersection.
•create a development that furthers all five of the city’s strategic priorities, as noted in
the staff report above.
•improve and install new city infrastructure including storm sewer, sanity sewer, water
lines and a street connection on Monterey Avenue, benefiting a larger area than the
project area.
•further diversify the city’s housing stock with new multi-family apartment offerings
consistent with the city’s strategic priorities and Comprehensive Plan.
•Enhance multi-modal transportation opportunities for residents, including trail
connections, sidewalks, and light rail.
•provide the community with 82 additional affordable housing units under the city’s
inclusionary housing policy, including 45 two-bedroom and 22 three-bedroom
affordable units, and five units at 30% AMI, to help the city provide opportunities for
affordable family housing. Due to the LIHTC allocation for the project, the units will be
affordable for 30 years.
Study session meeting of February 12, 2024 (Item No. 1) Page 16
Title: Update on proposed Beltline Station Development - Ward 1
• further the city’s sustainability goals by developing the affordable building to Enterprise
Green Community standards and the market rate buildings to SB2030/B3 standards, by
providing a rooftop solar array, and contributing to the community’s overall solar
energy usage by supporting Sherman Associates 6.75 megawatts solar farms.
• facilitate $142 million of new investment further invigorating the surrounding
neighborhood, providing additional retail and including a $25 million investment in
affordable housing.
• construct quality buildings (e.g., sound architectural design, quality construction and
materials) with underground parking, public features, and sustainable elements.
• redevelop underutilized and environmentally impacted property with substandard soils.
• bring current tax-exempt properties to optimal market value and add to the city’s tax
capacity.
Present considerations:
During the February 12, 2024 study session, staff will provide an overview of the Beltline
Station Development including history, previous actions, where it is now, and what actions are
needed to bring it to fruition.
Next steps:
Sherman Associates continues to work with their contractor to find additional cost savings and
with lenders to receive the lowest rates available. However, the latest parking ramp bid,
combined with the heightened interest rates, increased construction costs, and more restrictive
lending requirements continue to create a gap in the development’s financial proforma.
February – April 2024: Sherman Associates has reached out to the city and Met Council
requesting additional financial assistance. Staff is working with Ehlers, the EDA’s financial
consultant, and the EDA attorney to determine a prudent path forward. Staff looks to bring a
recommendation to the EDA/council in the coming weeks for consideration.
Also in the coming weeks, the EDA will be asked to consider approving the amendment to the
cooperative construction agreement. As noted in the timeline above, on December 13, 2023
the Met Council approved an amendment to the cooperative construction agreement to
provide an additional $984,167 to the project, and also have agreed to provide the money up
front, lowering the amount of funding the redeveloper will need to privately finance. Met
Council’s contribution to the project totals $3,484,167.
An outline of future actions and important deadlines is provided in the table below.
Future actions and deadlines Governing body Date
Sherman Associates has submitted a request for a one-
year extension for approval of the Beltline Station
preliminary and final plat. The original approval expires
on April 4, 2024, which is two years after its original
approval, unless extended by city council. A one-year
plat extension is typical city process.
City Council February
20, 2024
The EDA and city council will be asked to consider an
amendment to the following agreements in order to
EDA/City Council *April
2024
Study session meeting of February 12, 2024 (Item No. 1) Page 17
Title: Update on proposed Beltline Station Development - Ward 1
extend commencement and completion dates, and any
additional recommendations for financial assistance:
• Amendment to the Purchase Agreement
• Amendment to the affordable redevelopment
contract
• Amendment to the mixed-use/market rate
redevelopment contract
• Amendment to the Cooperative Construction
Agreement
*Sherman Associates has indicated its need to close on
project financing and start construction by the end of
April in order to meet all necessary project deadlines
and preserve the LIHTC and housing bond allocations.
The special legislation pooled tax increment dollars that
are allocated as part of the financial assistance provided
to the Redeveloper are required to be spent on private
construction related expenses no later than December
31, 2025.
NA Dec. 31
2025
Completion of the public park and ride stalls is required
six months prior to revenue service of the METRO
Greenline Extension. Revenue service is anticipated to
start in 2027, but the exact date is unknown.
If a parking ramp is not constructed, the EDA is
contractually required to construct a 268-stall parking
lot and related infrastructure. The Met Council is now
providing $3.4 million towards the construction of the
stalls. The construction of the parking lot is likely to
exceed $3.4 million dollars, and the EDA would be
required to pay any overages.
NA Jan 1,
2027
Approval of a Registered Land Survey (RLS) dividing the
parking ramp into various ownerships. A reciprocal
operating and maintenance agreement (REOA) related
to the long-term ownership and maintenance of the
ramp has already been drafted and approved by the
redeveloper and the Met Council. The REOA will be
placed in escrow at closing and will be recorded when
the RLS is approved.
City Council Once the
parking
ramp is
complete
A timeline of the Beltline Station Development
2008 to 2027
2008-2011
2012
2013
2014
2015
The Vision for SWLRT Station Areas in St. Louis Park (Beltline Blvd, Wooddale Ave and Louisianna Ave) completed.
Beltline Area Framework & Design Guidelines completed.
SWLRT Project Office and city begin work on a joint, mixed use development concept for Beltline Station. EDA acquires
4601 Highway 7 & 3130 Monterey Ave properties.
City/EDA applied for Federal Congestion Mitigation Air Quality (GMAQ) grant for park and ride parking ramp.
City/EDA awarded $7.56 million federal CMAQ grant to construct a 531-stall park and ride parking ramp.
EDA and Met Council requested federal amendment to SWLRT plans to reduce the park and ride stalls from 541 to 268.
The federal government approved the stall reduction and reduced the CMAQ award to $6.4 million. The ramp is required to be
completed 6-months prior to commencement of METRO Greenline Extension revenue service.
EDA acquired fee title to multiple remnant right-of-way tracts underlying CSAH 25 Frontage Rd to create a full development site.
EDA distributed a request for proposals (RFP) to prospective developers for the Beltline Station Redevelopment Site.
EDA entered into a preliminary development agreement with Sherman Associates to develop the site.
2016
2017
2018
2019
2020-2021
EDA provided a bridge loan to Sherman Associates to enable its purchase of the former Vision Bank property.
Met Council recorded a permanent transit easement over the Vision Bank property, requiring it be used for a public park and ride
facility providing 268 spaces.
EDA and city approved a first amendment to the Preliminary Development Agreement.
EDA approved a subrecipient agreement with the Met Council which specified the terms under which the CMAQ funds would be
disbursed to the EDA. (2019 deadline)
EDA entered into the cooperative construction agreement with the Met Council to construct the park and ride ramp.
EDA and Sherman Associates worked cooperatively to prepare a financial assistance package necessary to construct the
development including market studies, property appraisals, and grant applications.
2021 EDA and city approved a second amendment to the Preliminary Development Agreement.
2022 Sherman Associates received a tax-exempt bond allocation of $13.7 million for the affordable housing component. It required
Sherman to close on its financing for the affordable building no later than June 30, 2022.
Sherman Associates applied for a comprehensive plan amendment, a preliminary and final plat, a preliminary and final PUD, and
various easement and right-of-way vacations.
The city council approved the Sherman Associates’ various planning entitlement applications.
EDA held a hearing regarding the issuance of the tax-exempt bond allocations.
Sherman Associates submitted a building permit application for the all-affordable building.
EDA and city council approved the Beltline Station 1 and Beltline Station 2 TIF Districts.
EDA and city council approved the purchase agreement and the contract for private development related to the affordable
housing component.
Sherman Associates closed on the affordable building’s financing, meeting a June 30, 2022 State of MN deadline.
EDA approved the first amendment to the purchase agreement.
2023 Sherman Associates signed term sheets with its lenders for the development‘s market rate components.
EDA approved an early start and right-of-entry agreement to allow cleanup activities prior to an April 1, 2023 deadline to
preserve a DEED Grant for $418,547.
Sherman began cleanup activities on the affordable housing building site.
Sherman Associates submitted building permits for the mixed-use, market rate, and parking ramp components.
EDA approved an amendment to the purchase agreement and the affordable components amending the commencement
dates.
EDA held a public hearing on the property purchase agreement.
EDA and city council approved an amendment to the purchase agreement and approved the contract for private
development related to the market rate and mixed-use components.
EDA and Sherman Associates started the public bidding process related to the ramp.
Met Council declared the bid process as proof that the construction of the ramp commenced, meeting the required start
day of Sept. 30, 2023.
City council approved a PUD amendment to redesign the parking ramp.
EDA and Sherman Associates restarted the public bidding process related to the ramp.
EDA and city approved amendments to the various contracts amending the development’s commencement dates.
Met Council approved an amendment to the Cooperative Construction Agreement allocating an additional $984,167.
2024 The second round of public bidding closed on the ramp.
EDA and city council provided a letter stating they would not declare Sherman Associates in default.
Sherman Associates need to start construction by late April to remain on schedule to meet subsequent deadlines, and to
meet the requirements of the affordable component’s lenders.
2025
2027
Sherman Associates is required to spend special legislation pooled tax increment by Dec. 31, 2025, per special legislation.
Construction of the public park and ride stalls are required to be completed six months prior to commencement of METRO
Greenline Extension revenue service.
Black = significant milestone
Blue = EDA or city formal action
Red = mandatory deadline
Study session meeting of February 12, 2024 (Item No. 1)
Title: Update on proposed Beltline Station Development - Ward 1 Page 18
Meeting: Study session
Meeting date: February 12, 2024
Discussion item: 2
Executive summary
Title: Vision 4.0 process, timeline and discussion
Recommended action: No action is being requested. This item is for discussion purposes only.
Policy consideration: Staff would like the council’s input on a series of questions to ensure that
the process aligns with council expectations.
Summary: Beginning in 1995, St. Louis Park has engaged residents, community organizations,
businesses and partners through three 10-year visioning processes. Staff has begun planning for
the next city-wide vision process. The goal in this first conversation with council is to share the
high-level timeline (2024 through 2026) and discuss the following questions:
• Why are visioning processes important to you?
• How do you feel about the past vision and priority setting processes?
o What should we make sure continues to be incorporated?
o What improvements in the process could be made?
• What does a successful vision 4.0 process look like to you?
• Who would you like to see engaged in this process?
The council’s input will be used as workplans, engagement plans and external workgroups are
developed. Staff will bring updates to the council during key milestones or decision points.
Staffing: The vision 4.0 work will be led by Cheyenne Brodeen and Sean Walther. They will be
assisted by a group of employees representing all departments in the city.
Financial or budget considerations: Funds to cover the vision 4.0 work have been accounted
for in the 2024 budget and will be incorporated into 2025 projections.
Strategic priority consideration: St. Louis Park is committed to creating opportunities to build
social capital through community engagement.
Supporting documents: None.
Prepared by: Cheyenne Brodeen, administrative services director
Sean Walther, planning manager/deputy community development director
Reviewed by: Cindy Walsh, deputy city manager
Approved by: Kim Keller, city manager
Study session meeting of February 12, 2024 (Item No. 2) Page 2
Title: Vision 4.0 process, timeline and discussion
Discussion
Background:
Visioning is a process of creating a compelling statement about what a community aspires to be
or to accomplish in the future. It is a mental picture of the ideal future which is shared by its
leaders, residents, staff, community organizations and businesses. Creating a visioning process
that engages a broad range of stakeholders allows for the development of shared priorities and
identifies commonalities amongst members of the community. The process lays the foundation
for the development of goals, strategic priorities and measuring and monitoring outcomes.
Since 1995, St. Louis Park has engaged residents, community organizations, businesses and
partners through three 10-year visioning processes.
Vision St. Louis Park, 1995: Imagine a community so invested in its future that 200 people sat
down for a dialogue about community visioning and – in just a decade - saw their work create a
new town center and more than 300 innovations and initiatives, including becoming the
inaugural Children First community in the nation.
The following vision and priorities were adopted from the 1995 process “Our Vision for the
Future – St. Louis Park: our community of choice for a lifetime”.
• Diversity is a natural part of everyday life that enriches the entire community.
• Responsive service is a hallmark of city government.
• It is a safe environment in which to live, work and learn.
• Educational opportunities for all ages abound because a high value is placed on lifelong
learning.
• Children are a top priority for the entire community.
• A wide spectrum of quality housing is available to meet residents' housing needs
through all stages of life.
• Business provides a solid base for the community and benefits from strong support from
residents, schools and government.
• Residents have strong connections to the community thanks to community pride, civic
commitment, mutual respect and neighborliness.
Vision 2.0 St. Louis Park, 2005: Imagine a community so committed and so engaged in this
visioning process that they decided to say, "Let's do it again, bigger and better!" and embarked
on the process again. This time its participants number more than 1,000 engaged community
members.
The following strategic directions were adopted:
• St. Louis Park is committed to being a connected and engaged community.
• St. Louis Park is committed to being a leader in environmental stewardship. We will
increase environmental consciousness and responsibility in all areas of city business.
• St. Louis Park is committed to providing well-maintained and diverse housing options.
• St. Louis Park is committed to promoting and integrating arts, culture and community
aesthetics in all city initiatives, including implementation where appropriate.
Study session meeting of February 12, 2024 (Item No. 2) Page 3
Title: Vision 4.0 process, timeline and discussion
Vision 3.0, 2015: Imagine a community so committed and so engaged that they know the vision
needs to continue! This vision process generated insights from 4,600 comments from 1,500
people about how they felt about St. Louis Park and their hopes for the future. Then, it put
those insights into the context of major global trends to identify recommendations. Those
recommendations evolved into the city's strategic priorities.
The following strategic priorities were adopted:
• Being a leader in racial equity and inclusion in order to create a more just and inclusive
community for all.
• Continue to lead in environmental stewardship.
• Providing a broad range of housing and neighborhood-oriented development.
• Providing a variety of options for people to make their way around the city comfortably,
safely and reliably.
• Creating opportunities to build social capital through community engagement.
The visioning processes led to and supported operational changes and policies. Operational
changes include revising of the council reports, budget discussions and communications to
include the strategic priorities. Policies include the city’s comprehensive plan, connect the park,
and the climate action plan.
Full reports from each of the city’s visioning processes can be found online: Vision St. Louis Park
| St. Louis Park, MN (stlouisparkmn.gov)
Present considerations:
Vision 4.0 2025: Imagine a community so committed and engaged that the vision is a living,
breathing document that is embedded in all of the city’s core functions.
Staff has begun initial planning for the next city-wide vision process that will be adopted in
2026. It is important to hold a preliminary discussion with council to incorporate their input
before concrete plans have been established. Throughout staff’s presentation, the following
questions will be asked:
• Why are visioning processes important to you?
• How do you feel about the past vision and priority setting processes?
o What should we make sure continues to be incorporated?
o What improvements could be made?
• What does a successful vision 4.0 process look like to you?
• Who would you like to see engaged in this process?
The council’s input will be used as workplans, engagement plans and external workgroups are
being developed. Staff will bring updates to the council during key milestones or decision
points.
Staff developed the following timeline to guide the initial planning stage:
Study session meeting of February 12, 2024 (Item No. 2) Page 4
Title: Vision 4.0 process, timeline and discussion
• Jan. – June 2024 (planning stage): Staff has begun planning for the next vision 4.0
process. During this stage, an internal planning committee will be established, a work
plan and engagement plan will be developed, and an external consultant will be chosen.
• July – Dec. 2024 (community identity + pre-engagement): During this stage, an external
workgroup will be established and pre-engagement on community identity will be
conducted.
• 2025 (vision 4.0 engagement): During this stage, the vision 4.0 engagement will be
conducted.
• 2026 (vision 4.0 priorities set): During this stage, the council will adopt the final set of
strategic priorities for the next 10 years and around which a strategic plan can be
developed.
The Vision 4.0 process will be led by Cheyenne Brodeen, administrative services director, and
Sean Walther, deputy community development director and planning manager. They have
organized an internal planning committee to assist with the development of the process. This
committee comprises staff from every city department. This group’s role will be to help design
a work plan, engagement plan, help select possible consultants and bring their experiences as
individual staff and connection to their department’s work.
An external workgroup will be organized later this summer. This group will be made up of
stakeholders from community organizations, businesses and interested residents. Their role will
be to enhance the vision 4.0 process from the community lens.
An important aspect of large, multi-year engagement process is to incorporate time and space
for pre-engagement. This phase is being referred to as community identity and it provides an
opportunity for community to review the history of the St. Louis Park and the past visioning
processes to review and celebrate where the community has been so that we can start a new
conversation about where we are heading.
Next steps:
Staff will continue to develop the plans for the vision 4.0 process and will provide updates to
council during key milestones or decision points.
Meeting: Study session
Meeting date: February 12, 2024
Written report: 3
Executive summary
Title: Hennepin County Minnetonka Boulevard reconstruction project update (4023-7000) -
Ward 1
Recommended action: None at this time. This report is intended to provide the council with an
update on the project scope since it was approved on Dec. 5, 2022. The council will be asked to
approve the cooperative construction agreement with Hennepin County for Minnetonka
Boulevard at the Feb. 20, 2024 city council meeting.
Policy consideration: Does the city council support the infrastructure improvements included in
Hennepin County's reconstruction project?
Summary: On Dec. 5, 2022, the city council approved the preliminary layout for the
Minnetonka Boulevard reconstruction project. A few changes to the project scope have
occurred since that time. These changes are detailed in the discussion section of this report.
The construction schedule for Minnetonka Boulevard is shown below.
2024 construction
• Minnetonka Boulevard from Inglewood Avenue to France Avenue
• County Road 25 from Lynn Avenue to Drew Avenue
2025 construction
• Minnetonka Boulevard from Highway 100 to Inglewood Avenue
Some improvements on county roads require a financial contribution from the city. To
formalize the city's cost participation and other matters associated with this project, a
cooperative agreement will be brought to the city council at the Feb. 20 meeting.
Financial or budget considerations: The city costs for this project are included in the 2024
capital improvement plan (CIP) and will be paid for using general obligation bonds and utility
funds. The construction cost estimate is being finalized and will be provided as a part of the
Feb. 20 city council report. Moving overhead utilities underground will be paid for using a City
Requested Facilities Surcharge (CRFS).
Strategic priority consideration: St. Louis Park is committed to providing a variety of options for
people to make their way around the city comfortably, safely and reliably.
Supporting documents: Nov. 14, 2022 study session report
Nov. 21, 2022 public hearing report
Dec. 5, 2022 city council report
May 1, 2023 city council report
Jan. 22, 2024 city council report
Attachment 1: 2024 and 2025 construction
Attachment 2: CR 25 frontage road
Attachment 3: CRFS rates
Prepared by: Joseph Shamla, engineering project manager
Reviewed by: Debra Heiser, engineering director
Approved by: Kim Keller, city manager
Study session meeting of February 12, 2024 (Item No. 3) Page 2
Title: Hennepin County Minnetonka Boulevard reconstruction project update (4023-7000) - Ward 1
Discussion
Background: Minnetonka Boulevard is being reconstructed by Hennepin County in 2024 and
2025. On Dec. 5, 2022, the city council approved the preliminary layout for the Minnetonka
Boulevard improvement project. The city council approved a "no parking" resolution for
Minnetonka Boulevard on May 1, 2023. Staff met with the city council regarding the moving of
the overhead utilities underground on Jan. 22, 2024. Hennepin County is currently working on
the final design and bid documents for this project.
The construction schedule for Minnetonka Boulevard is shown below. Attached is a map
showing staging.
2024 construction
• Minnetonka Boulevard from Inglewood Avenue to France Avenue
• County Road 25 from Lynn Avenue to Drew Avenue
2025 construction
• Minnetonka Boulevard from Highway 100 to Inglewood Avenue
Some improvements on county roads require a financial contribution from the city. To
formalize the city's cost participation and other matters associated with this project, a
cooperative agreement will be brought to the city council at the Feb. 20 meeting. This
agreement is currently being reviewed by staff and the city attorney. The construction cost
estimate is being finalized and will be provided as a part of the Feb. 20 city council report.
Present considerations: A few changes to the project scope have occurred since the project
was approved in Dec. 2022. The following is a summary of the changes discussed in this report:
• Eastbound left turn on Inglewood Avenue
• County Road 25 frontage road modifications
• Moving overhead utilities underground
• Tree removal
Additionally, there is information pertaining to:
• Open house #3
• Additional enhanced pedestrian crossing
• Project schedule
Eastbound left turn on Inglewood Avenue: The preliminary plans for Minnetonka Boulevard
near Inglewood Avenue included a median. During the public process, staff heard from
residents that they were concerned about additional traffic using Joppa Avenue due to the
restrictions of eastbound Minnetonka Boulevard left turns at Inglewood Avenue. The project
team developed plans to allow left turns onto Inglewood Avenue. The changes at Inglewood
Avenue were presented at the open houses on Jan. 29 and on Jan. 30 and also provided to faith
leaders in the area. The project team received positive feedback on the new design and will be
constructing eastbound Minnetonka Boulevard with a left turn at Inglewood Avenue.
County Road 25 frontage road modifications: The County Road 25 frontage road between
Joppa Avenue and Minnetonka Boulevard is a city-jurisdictional street that is programmed for
reconstruction in 2025. The frontage road has low traffic volume and parking is allowed on the
street. Starbucks has a driveway onto Joppa Avenue and their drive-thru exits onto Inglewood
Avenue; they do not have a driveway onto the frontage road.
Study session meeting of February 12, 2024 (Item No. 3) Page 3
Title: Hennepin County Minnetonka Boulevard reconstruction project update (4023-7000) - Ward 1
After a review of traffic routing, traffic volumes and parking demand, city staff recommends the
frontage road between Joppa and Inglewood avenues be removed as a part of this project for
the following reasons:
• A parking study has been completed on this section of road. This area has sufficient
parking and does not require the frontage road on-street parking.
• The removal of the south frontage road will not result in removing access to the
adjacent property.
• This change removes a segment of the service road which is underutilized.
• The roadway has two parallel routes (Minnetonka Boulevard and County Road 25) with
sufficient capacity for vehicles to use to route through the area.
• The change reduces impervious surface, providing a larger area for greenspace,
landscaping and stormwater treatment.
• It is consistent with the city's Climate Action Plan goals.
• Removing this road will result in long-term operation and maintenance cost savings for
the city.
Hennepin County and city staff have met with the adjacent property owner and this change to
the plan was shared at open house #3. See the attached exhibit for details.
Moving overhead utilities underground: At the Jan. 22, 2024 study session, council provided
staff direction to pursue moving the overhead utilities underground. Staff is working with Xcel
Energy on an agreement to move the overhead lines underground. The cost of completing this
work will be paid using City Requested Facilities Surcharge (CRFS), which is a fee that is added
to the bill of all St. Louis Park Xcel Energy customers. A single-family household is estimated to
pay $8.40 per year, while a low-income household will pay $3.00 per year. Other land uses will
have fees that vary depending on the use. This fee will be on the bill for three years and will
start once the undergrounding work is complete. The estimated rates are attached.
Removing poles in the corridor and construction will likely impact the eruv. City staff has been
in contact with the Jewish faith leaders to discuss options. County and city staff are committed
to working with faith leaders to maintain the eruv both during and after construction.
Tree removal: To avoid conflicts with nesting birds, bats and bees and to meet federal grant
obligations, the trees identified for removal as part of the project must be removed prior to
March 31, 2024, or after Oct. 31, 2024. Hennepin County will be removing trees that need to be
removed to construct this project by March 31, 2024. This information was shared with the
residents and business owners at open house #3.
Open house #3: Community members were invited to a third open house to review the final
plans. This open house was held virtually on Jan. 29, 2024 and in-person on Jan. 30, 2024. A
recording of the virtual open house is available on the project website for anyone who was
unable to attend. Approximately 40 people attended the virtual open house and approximately
40 people attended the in-person open house. Please see the most frequently asked questions
at the open house along with the staff response.
Why does this project construct multi-use trails instead of separate facilities for bicyclists and
pedestrians?
• Many alternatives were evaluated during public engagement and included protected
bike facilities and bike lanes on the roadway. A multi-use facility was ultimately selected
for the following reasons:
Study session meeting of February 12, 2024 (Item No. 3) Page 4
Title: Hennepin County Minnetonka Boulevard reconstruction project update (4023-7000) - Ward 1
1. Protected bike lanes on both sides of the roadway would not fit within the available
66 feet of public right of way and would require significant acquisitions of private
property.
2. A two-way bike facility on one side would require crossing Minnetonka Boulevard
for many users.
3. Bicycle facilities on the roadway did not meet the goals of an all-ages and abilities
network.
4. A multi-use trail on both sides of Minnetonka Boulevard provides access for users of
all ages and abilities and adds green boulevards on both sides of the roadway that
improve safety, stormwater treatment and streetscape.
Will the re-design of the Minnetonka Boulevard/ Inglewood Avenue intersection reduce the
traffic concerns brought up during the public engagement process?
• The project team has revised the final plans to include an eastbound Minnetonka
Boulevard left turn onto Inglewood Avenue. This was done to address concerns of
increased traffic on Joppa Avenue. Constructing the left turn at Inglewood Avenue will
allow traffic to stay on Inglewood Avenue, which is the preferred connection north of
Minnetonka Boulevard.
Where will customers park if the County Road 25 frontage road is removed by Starbucks
(between Joppa and Inglewood avenues)?
• The project team completed a parking study to determine the parking that is utilized
near Starbucks. The available parking was reviewed at different times of the day and on
weekdays and weekends. Parking was being utilized along the frontage road, but there
were also open spots in the parking lot that could have been used. Adequate parking
will be available with a portion of the frontage road removed. Also, parking will be
available on Inglewood Avenue that will be reconstructed between the Starbucks exit
and Minnetonka Boulevard.
Can the posted speed limit on Minnetonka Boulevard be lower than it is today (35mph)?
• Per state statute, speeds on County Roads are set by the Commissioner of
Transportation. To establish a new speed limit for Minnetonka Boulevard, Hennepin
County must follow the process of completing a speed study post-construction. The
intent is that the four-lane to three-lane conversion will slow traffic. A speed study after
construction may result in a speed limit reduction to 30 mph, the minimum allowed for
county roads.
Will removing one lane of traffic cause a lot of backups along Minnetonka Boulevard?
• The proposed three-lane section of Minnetonka Boulevard will safely accommodate the
approximately 15,000 vehicles per day in most of the corridor. The traffic volumes are
higher on the west end of the project between Salem Avenue and the northbound
Highway 100 ramps. The road in this area will remain wider to accommodate the
additional traffic.
• Metro Transit completed a study of route 17 to determine where bus stops should be
located based on demand. Based on the study, new bus stop locations were
implemented in August of 2023. Having fewer bus stops along the corridor will increase
the level of service for buses and vehicles.
Study session meeting of February 12, 2024 (Item No. 3) Page 5
Title: Hennepin County Minnetonka Boulevard reconstruction project update (4023-7000) - Ward 1
Additional enhanced pedestrian crossing: Guidance for enhanced pedestrian crossings is to
consider installing them at quarter-mile spacing along high-volume roadways. This guidance
was applied during project design. The project, as it was approved in Dec. 2022, included
controlled crosswalks at the following locations:
• Signal at the northbound Highway 100 ramps
• Rectangular rapid flashing beacon (RRFB) at Quentin Avenue
• Signal at Ottawa Avenue
• Signal at Joppa Avenue
At open house #3 on Jan. 30, 2024, a community member made a request to consider adding
an additional enhanced crosswalk (RRFB) to the corridor at the intersection of Minnetonka
Boulevard and Lynn Avenue.
City staff has reviewed the location and is discussing adding it to the project with Hennepin
County. An enhanced crosswalk at this location will provide a connection to the sidewalks that
were installed on both sides of Lynn Avenue in 2021 and the crossing of County Road 25 at the
Lynn Avenue signal. Creating connections between the neighborhood and transit, both bus
transit on Minnetonka and the Beltline LRT station.
Hennepin County staff indicated that if this is added to the project, the cost and ownership for
the RRFB would be the city's responsibility. The estimated cost and staff recommendation
about this additional crossing will be included in the report on Feb. 20, 2024.
Schedule: The proposed project schedule to facilitate construction beginning in 2024 is as
follows:
Council approves cooperative agreement with the county Feb. 20, 2024
Final plans submitted to MnDOT Federal Aid for review February 2024
Tree removals in CSAH 25/CSAH 5 area February/ March 2024
Condemnation hearing and easements finalized March 2024
Federal approval and authorization to bid March 2024
Bid opening May 2024
Private utility relocation May 2024
Construction begins July 2024
Project substantially complete and open to the public October 2025
Construction complete November 2025
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-• 2024 construction (July-November)
-• 2025 construction (April -November)
Study session meeting of February 12, 2024 (Item No. 3)
Title: Hennepin County Minnetonka Boulevard reconstruction project update (4023-7000) - Ward 1 Page 6
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Study session meeting of February 12, 2024 (Item No. 3)
Title: Hennepin County Minnetonka Boulevard reconstruction project update (4023-7000) - Ward 1 Page 7
Northern States Power Company, a Minnesota
Corporation City Requested Special Facilities Surcharge
(CRFS) City of St. Louis Park
650,000
Customer Class Customers Surcharge(1)Months Recovery
24,099 $0.70 36 $604,680
475 $0.25 36 $4,257
1,320 $0.70 36 $33,121
692 $2.10 36 $52,090
203 $2.80 36 $20,374
120 $0.70 36 $3,011
17 $0.70 36 $427
10 $2.10 36 $753
Residential
Res Low Income
Small C&I ND Small
C&I
Large C&I
Street Lighting Sm
Mun Pump ND Small
Mun Pump Large
Mun Pump 4 $2.80 36 $401
Total 26,940 $719,113
Total Carrying Charges included in recovery amount(2)$69,114
Allowable Class Surcharge Levels per Month Under CRSF Tariff
$0.25 up to $5.00
$0.25 up to $1.00
$0.25 up to $5.00
Residential:
Low Income Residential:
Small C&I Non-Dmd: Small
C&I - Demand: Large C&I -
Demand:
3 Times Residential Amount 4
Times Residential Amount
(1)Adjustment possible in final months of recovery period for more precise cost recovery.
(2)
Excess Expenditures =
Monthly carrying charge of 0.7053% applies to outstanding balance, equal to compounded rate based on 6.84%
overall rate of return from the last general rate case (2022 of MYRP) and 1.96% tax factor.
Study session meeting of February 12, 2024 (Item No. 3)
Title: Hennepin County Minnetonka Boulevard reconstruction project update (4023-7000) - Ward 1 Page 8
Meeting: Study session
Meeting date: February 12, 2024
Written report: 4
Executive summary
Title: Subordination and assignment of redevelopment contract - Zelia on Seven - Ward 2
Recommended action: None at this time. The EDA will be asked to consider adopting a
resolution of approval at the February 20, 2024 EDA meeting for a subordination agreement
and an assignment of tax increment revenue note and development agreement in connection
with the purchase and redevelopment agreement as amended with Bigos-Zelia on Seven, LLC
and Bigos-Via Sol, LLC for the Zelia on Seven multifamily housing development.
Policy consideration: Does the EDA and council wish to approve the subordination agreement
and an assignment of tax increment revenue note and development agreement with Bigos-Zelia
on Seven, LLC and Bigos-Via Sol, LLC to facilitate the Zelia on Seven’s proposed site
improvements and long-term permanent financing?
Summary: On Dec. 18, 2023, the EDA amended the purchase and redevelopment agreement
(the “contract”) related to the Via Sol apartment building with Bigos-Via Sol, LLC to update
definitions of the minimum improvements and amended the affordability levels of the
development. The contract provides that the EDA will issue a tax increment revenue note (the
“TIF note”) to the developer. Bigos-Via Sol, LLC purchased the Via Sol property on Dec. 28,
2023, and renamed the building Zelia on Seven.
Bigos-Zelia on Seven, LCC and Bigos-Via Sol, LLC (together, the “developer”) request that the
EDA subordinate certain rights under the redevelopment contract to JLL Real Estate Capital, LLC
(the “lender”) which is providing the permanent financing for the property purchase. In
addition, the developer requests that the EDA consent to the assignment of certain rights under
the contract and the TIF note to the lender as security for its financing. The proposed
subordination and assignment are similar to other subordination agreements and assignments
of tax increment financing documents that the EDA has previously approved for other projects,
and is not uncommon. The proposed subordination agreement and an assignment of tax
increment revenue note and development agreement have been reviewed by the EDA’s legal
counsel. The subordination and assignment document is available upon request from economic
development staff.
Financial or budget considerations: All costs associated with the preparation of the proposed
subordination agreement and assignment (Kennedy & Graven) are to be paid by Bigos-Zelia on
Seven, LLC and Bigos-Via Sol, LLC.
Strategic priority consideration: St. Louis Park is committed to providing a broad range of
housing and neighborhood oriented development.
Supporting documents: None.
Prepared by: Jennifer Monson, redevelopment administrator
Reviewed by: Greg Hunt, economic development manager
Karen Barton, community development director; EDA executive director
Approved by: Kim Keller, city manager