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HomeMy WebLinkAboutDecember 12, 2000 I 0 0 CJ CITY of ANDOVER ANDOVER ECONOMIC DEVELOPMENT AUTHORITY MEETING DECEMBER 12, 2000 - MINUTES A Meeting of the Andover Economic Development Authority was called to order by Mayor Jack McKelvey on December 12,2000,6:00 p.m., at the Andover City Hall, 1685 Crosstown Boulevard NW, Andover, Minnesota. Present: Councilmembers Don Jacobson, Mike Knight, Ken Orttel, Julie Trude Resident members Robert Nowak Absent: Resident member Bill Hupp Also present: City Engineer, Scott Erickson City Finance Director, Jim Dickinson Acting City Administrator, Dave Carlberg Others Ü APPROVAL OF MINUTES November 14, 2000: Correct as written. Motion by Orttel, Seconded by Jacobson, approval as written. Motion carried on a 5- Yes, I-Present (Trude), I-Absent (Hupp) vote. APPROVE 2001 EDA BUDGET Mr. Dickinson reviewed the proposed 2001 EDA budget, noting there is all. 7 percent increase in expenditures over the 2000 budget. Much of that is reflected in increases of time spent by a few Staff members on EDA activities. The time spent by the Community Development Director increased, plus there is an increase from 5 to 10 percent of time spent on EDA items by the Finance Director. Another primary increase is the additional· dollar amount for purchased services. Additional time spent by the attorney when dealing with and evaluating problems outside the TIF district is reflected in the budget. Additional time spent by Mike Malrooney for services not necessarily in the increment district have· also been added. Some items can be billed back to the increment district. All increment goes to the Tax Increment account and the EDA can bill that account for services. They are very limited as to how much ofthe services they can fund. 0 There was some discussion on the operations of the Tax Increment Fund, projections that have been done on the increment of the fund, the increases projected for transportation and mealsllodging and the amount of time allocated for the City Administrator to economic development activities. Mr. Dickinson noted the detailed analysis done earlier this year on projected increment and the ability to bond. Increases for transportation and mealsllodging were based solely on the past history of u U \ Andover Economic Development Authority , ) Minutes - December 12, 2000 Page 2 (Approve 2001 EDA Budget, Continued) EDA activities, much of which are related to the activities of the administrator. Councilmember Jacobson raised the concern of almost doubling those items. Mr. Dickinson stated that amount can be reduced, especially since it is unlikely there will be an administrator on board until March, 2001. The budget cannot be taken into the negative. It operates based on land sales, and quite often those land sales are rolled back into the project being worked on. It also operates on revenue from the TIF fund. The charge to the EDA budget of the administrator's time is 45 percent. Councilmember Orttel felt that is very high and questioned whether the figures are based on reality. Mr. Dickinson recommended in the future with any new initiatives requested by the EDA that there be budget modifications made at the same time. There was also a short EDA discussion on speculation of the impact of the Governor's proposed budget on TIF funds. Motion by Jacobson, Seconded by Trude, approval of the budget as presented. Motion carried on a 6- Yes, I-Absent (Hupp) vote. "\ '-j DISCUSS LETTERS OF INTENT/ANDOVER STATION Mr. Carlberg reported a meeting was held last week to discuss the terms of the two letters regarding the development of Andover Station. Mike Malrooney, Advance Resources for Development, Inc., reviewed the comparisons of the two proposals. Proposal 1 was to purchase 19.3 acres, Parcels A, B, and G, with a three-year option to purchase Parcels C, D, E and F, for a purchase price of $3. I9/square foot. It is a developer oflarge retail shopping center complexes, which has teamed up with a reputable housing developer to construct the high density housing portion in Parcel G. The developer has a commitment for a grocer for the site and feels they may have a drug store for the southwest corner of Quinn Street and Bunker Lake Boulevard. They would also plan to construct the office building on the southerly portion of Parcel A, generally following the master plan of the City. Those at the meeting were concerned with the three-year option, as that is a long time to wait. The proposal did not specify whether they or the City would pay the costs of upgrading Quinn Street. It would be a substantial cost savings to the City for the developer to pay for it. Mr. Malrooney reviewed the second proposal to purchase 12 acres, including Parcel A and a part of B for a price of $2.92/square foot with the cost of a traffic light at Quinn Street and Bunker Lake Boulevard being the responsibility of the City. The developer is proposing a retail center with a grocery as the major anchor. They would consider this a neighborhood shopping center. They were \ flexible on constructing the office building with banking facility on Parcel A. There was no -) commitment to acquire any of the other parcels in the Andover Station area. / \ (J \~ ; '\ Andover Economic Development Authority , / Minutes - December 12, 2000 - Page 3 (Discuss Letters of Intent/Andover Station, Continued) Mr. Malrooney stated the recommendation of the subcommittee of the EDA, Staff and legal counsel was that Proposal I is superior. They recommended the EDA direct Advance Resources for Development, legal counsel and Staff to continue discussions with the developer of Proposal 1 to arrive at mutually acceptable terms and conditions for the acquisition. Discussion was on the two proposals. Mr. Malrooney stated the proposals are such that the developer will own the facilities and lease to a variety of tenants. He felt the grocers in both proposals would be desirable for this area. They are not yet done with negotiations, and it may even be that they would get their own grocer that is more desirable for the community. There has also been some discussion about having Quinn Street as a private street. Mr. Carlberg estimated the construction of Quinn street at $750,000 to $1 million plus about $250,000 for a signal. Who pays for that needs to be clarified in the proposals. The county will not participate in the light because it does not meet warrants. Additional work needs to be done on the ponds as well, and who pays for that still needs to be negotiated. Mr. Malrooney stated the three-year option for Proposal I is another point of negotiation. The City \ Attorney has suggested that be a one-year option. The City doesn't benefit from that land being idle. , , ) The developers of Proposal 1 hope to begin construction in April, 2001. Mr. Carlberg stated one of the things the subcommittee liked about Proposal 1 is that it follows the master plan. Also, that developer would be purchasing a larger piece of the property. In discussing the high density housing portion on Parcel G, Mr. Carlberg stated the concept showed three story buildings with the ground floor being retail businesses. It could be senior facilities. The exact density hasn't been determined. The maximum density under the City's zoning and Comprehensive Plan would be 10 to 12 units per acre, or 14 with a PUD. More will be known next week after meeting with the developer if the EDA so approves. Councilmember Orttel stated the EDA would be looking for a commitment from the developer to have businesses upgrade their facilities substantially to fit into the area. Mr. Carlberg stated that was discussed. They understand the EDA is looking for something different and unique unlike anything else in the metro area. Motion by Trude, Seconded by Jacobson, to authorize Staff, City Attorney, Mr. Malrooney and the EDA to further negotiate with the persons of Proposal 1. Motion carried on a 6- Yes, I-Absent (Hupp) vote. DISCUSS ANDOVER ASSOCIATES, LLC PURCHASE PROPOSAL Mr. Carlberg stated the EDA has received a proposal from Andover Associates, LLC., to purchase 1.76 acres ofland at the northeast intersection of Bunker Lake Boulevard and Jay Street for a price ~- ) of$3 per square foot. Of the items listed on the November 17, 2000, letter, Items No.5 and 10 need discussion. Item 5 states the assessments are to be paid by the City of Andover. The City's position is the bank would be responsible for paying the sewer and water area and connection charges, etc. (Discuss Andover Associates, LLC Purchase Proposal, Continued) , \ , (.-J ( ) ..j " Andover Economic Development Authority " j Minutes - December 12, 2000 Page 4 Mr .Carlberg continued, when Jay Street is constructed to the north~ that lot would also be assessed for its share of the street, sidewalks or trails. On Item 10, the bank currently plans to have a right-in, right-out access on Bunker Lake Boulevard. All such accesses/exists have been eliminated from Andover Station to facilitate the flow of traffic on Bunker Lake Boulevard. That access could also interfere with the future turn lane onto Jay Street. Staff is recommending access to the bank from Jay Street. Also, at this point, it will not be possible to close on the property on December 15,2000, as stated in Item 2. If the EDA adopts the terms, the closing can be scheduled as soon as possible after that. Mr. Carlberg also noted that the Andover Review Committee is working with the developer on the plans for the bank. The problem has been they do not have a good handle on the legal boundaries of the property. As of today, there was a question of easement on the north side of Bunker Lake Boulevard and how that affects the site itself. Because Jay Street is not fully constructed, for now the bank would have a driveway access off Jay Street. Other issues that they are struggling with are the frontage road concept and accessing the property to the east. This is being rushed through without the benefit of a master plan for the area. There was a great deal of discussion on the market value of the property. Mr. Malrooney stated he had been approached about purchasing property in this area at a price of $5 per square foot, but he ) did not know whether or not the developer would pay for the assessments at that point. Mr. Carlberg stated the assessments can increase the cost as much as $1.75 to $2 per square foot. The City is" fully committed to having a bank at that location. It is only a matter of terms. Mike Quigley, representing Andover Associates, LLC., stated they are in agreement with paying the assessments. When Jay Street is extended north, they would also be agreeable to paying the assessments to the point of the benefits to their lot. Regarding Item 10, they have looked at access from Bunker Lake Boulevard extensively. They could forego the right-out portion, but a right-in off Bunker Lake Boulevard is critical given the construction of the bank and the drive-up teller lanes. Even temporarily having access from Jay Street only would damage their business. Mr. Carlberg stated the City does have the authority to add a right-in lane to the bank off Bunker Lake Boulevard. The EDA authority thought a right-in only to the bank would be agreeable but suggested the item be discussed with the County Highway Engineer. Mr. Erickson stated they will talk with the county. If it doesn't cause any problems, they will work to accommodate it. . Mr. Carlberg noted Staff is looking at a temporary pond for storm sewer drainage. The excavated dirt from that pond will be used to raise the bank site up. He also stated there was a full appraisal done on Andover Station this summer, which came to $3.50 per square foot. Staff felt they had-a good idea of prices in that area, and that is why the EDA elected not to have an appraisal done for this property. Councilmember Orttel stated the EDA does not know whether the other proposals include utilities. If so, the $3 per square foot price is right. , , ) (Discuss Andover Associates, LLC Purchase Proposal, Continued) At this point, the EDA had no disagreements with Items 2-10 of the letter. They asked Staff to ~ '\ , I , I '_J Andover Economic Development Authority , Minutes - December 12, 2000 Page 5 research whether other per-acre costs discussed by potential developers include utilities. Then the EDA would act on this proposal and deal with the property value only at a short meeting on December 19 at 6:30 p.m. Motion by Orttel, Seconded by Jacobson, to adjourn. Motion carriedon a 6- Yes, I-Absent (Hupp) vote.. The meeting adjourned at 7:10 p.m. Respectfully subm.itted, ·\f\~l~~~ Ma~èella A. Peach Recording Secretary , \ ) ,