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HomeMy WebLinkAboutWK March 9, 1999 LM" 'f\J\I C (j\ '1/ Lf (Clú( CITY of ANDOVER 1685 CROSSTOWN BOULEVARD NW. . ANDOVER. MINNESOTA 55304· (612) 755-5100 City Council WorkshoplPlanning Session - Tuesday, March 9, 1999 from 7 to 9 p.m. 1. . Discussion of Various Economic Development Issues a) Financial Update of the nF District b) Andover Station c) Crosstown Redevelopment Project d) 78 acres South ofWDE Site e) Relocation of Conn ex us Energy Sub-station 2. Review Vision/Goals of Council and past Mission Statement 3. Other Business Adjournment . ,.. . -,- CITY of ANDOVER SPECIAL ANDOVER CITY COUNCIL MEETING - MARCH 9,1999 - MINUTES A Special Meeting of the Andover City Council was called to order by Mayor Jack McKelvey on March 9,1999,7:00 p.m., at the Andover City Hall, 1685 Crosstown Boulevard NW, Andover, Minnesota. Councilmembers present: Don Jacobson, Julie Johnson, Mike Knight, Ken Orttel (arrived at 7:18 p.m.) Councilmembers absent: None Also present: City Engineer, Scott Erickson Community Development Director, Dave Carlberg Park and Recreation Commission Chairperson, Dave Blackstad City Administrator, Richard Fursman ECONOMIC DEVELOPMENT ISSUES - FINANCIAL UPDATE OF TIF DISTRICT Mr. Fursman stated Tom Truszinski of Juran and Moody was asked to determine if the City wanted to issue a bond at some point in 1999 for tax increment, what ability is there to do so. Mr. Truszinski reviewed the cash flow analysis he had prepared of the TIF Redevelopment District. He stated very conservative estimates were made of a I .5-percent inflationary increase in revenues for the existing Districts I and 2 until the year 20 I 2; estimating the increments from the four projects of the theater, restaurant, veterinary hospital and office warehouse, assuming no further sales or development;.assuming no market value increase in the property for the next 12 years; and increasing the interest rate about one-fourth percent from the current market. Based on that, the City could issue a bond of$2,910,000 for project costs, which is a total of$3,1 15,000 including bond costs. Mr. Fursman also reviewed the TIF summary report which was presented to the Council noting the total revenue of bond proceeds and other revenue sources of $ I 0,468, I 73, total expenditures of fees and project costs of $10,628,809.20, with cash available at 02-28-99 of ($ I 60,636.1 0). Future revenue sources are estimated to be $1,397,541.67, and current TIF obligations remaining on existing projects amount to $98 I ,434. (Councilmember Orttel arrived at this time, 7: I 8 p.m.) Mr. Erickson then reviewed items that have not yet been ordered but will need to be done to complete the Andover Station project, including signage, landscaping, street improvements and lighting. He also reviewed the estimated cost to develop the North Bunker Commercial Park, that area south of the WDE site that has recently been purchased by the City, plus the cost to acquire Anoka Auto Wrecking and for the relocation of the electric substation on the corner of Bunker Lake . . I I Special Andover City Council Meeting Minutes - March 9, 1999 Page 2 (Economic Development Issues - Financial Update of the TIF District, Continued) Boulevard and Hanson Boulevard. Estimated TIF costs to complete the Andover Station development is $1,467,000. The 78-acre North Bunker Commercial Park area is estimated to cost $1,500,000 to develop with $ I ,200,000 coming from TIF funds and the remainder from MSA funds for the street. Mr. Fursman noted the potential revenue that would be generated from the land sales at the Andover Station, North Bunker Commercial Park, Anoka Auto Wrecking and the substation area at $ I per square foot, totaling $4,748,040. Several Council members felt that most of the land could be sold for more than $1 per square foot, which will generate even more revenue. Mr. Fursman agreed, again presenting a very conservative figure. Mr. Carlberg stated the electric companies need to know soon whether or not the City wants to go ahead with moving the substation to the north and acquiring the land in front. He anticipated the North Bunker Commercial Park would be developed as commercial/industrial with some retail along Hanson Boulevard and offices or storage-type buildings in the back. Larger businesses may find the site attractive. Some park facilities have also been proposed. Councilmember Orttel wanted to be sure that the retail in this area will not be in competition with those that will be in Andover Station. He hoped there wouldn't be two major grocery stories competiting, but he didn't think it would be as much of a problem having two restaurants. He did feel there is a demand for retail. He also suggested getting an artist's rendering of what the substation area would look like if it were moved further north. Mr. Carlberg stated there would be about 240 feet to work with along Bunker Lake Boulevard. Councilmember Knight wondered if the same development company developed both parks that they would anticipate not setting up competition. Mr. Fursman hoped so, stating the City would not want identical applications on both sides of the street. The City would be in control of the land. Mr. Truszinski stated the TIF districts would be decertified on December 31, 2012, and all bonds have to be paid by then. More specific figures of tax increment will be available from the county within the next month. Mr. Fursman noted the day care and a couple other businesses will increase the amount of cash already coming into the system. There was some discussion on the purchase of Anoka Auto Wrecking. It was felt that acquisition would be necessary for the development of the North Bunker Commercial Park, as the success of both developments may be dependent on removing that business from the area. While the owners would have the option of developing themselves, most felt the preference would be to sell. The Council generally agreed with the purchase but noted the funding is not available at this time, as all of the money from the TIF revenue stream is being used to complete Andover Station. Several ideas on timing and cash flow were discussed to be able to purchase the business. In the meantime, they suggested Staff contact the owners of Anoka Auto Wrecking regarding their plans and ideas for selling, a time frame, costs, etc., and begin negotiations. Another option that may be agreeable to the owners would be to pay for that purchase over a period of years. ~. ... - . ---- "-- .- - ': Special Andover City Council Meeting Minutes - March 9, 1999 Page 3 (Economic Development1ssues - Financial Update of the T1F District, Continued) In discussing the development of the North Bunker Commercial Park, Mr. Fursman also noted that the City has a lot of debris from the Andover Station site that must be moved, and the thought was to develop a sliding hill in this area with that material. Because of that, a decision on the location of the park facilities must be made very soon. If that material must be hauled to a landfill, the project costs will increase by half to one million dollars. The Council then agreed it is necessary to bond to do those projects necessary to complete the Andover Station development. The bond would be for the maximum amount. Mr. Truszinski stated to set up a bond sale is about a two-month process. The Council also agreed to hold an EDA meeting on March 30, 7 o'clock, to review the bond proposal and to discuss the projects that still need to be done to complete the Andover Station site. ECONOMIC DEVELOPMENT ISSUES - RFQ FOR ANDOVER STATION Mr. Fursman reviewed the Request for Qualifications draft to be submitted to various developers. Mike Mulrooney is not able to attend the meeting this evening. The Council wanted to be sure the City doesn't lose control over the project. Mr. Fursman stated the developer would be coming with a proposal that the City would need to agree with. The Council generally agreed that the project has been proceeding too slowly, noting that right now the economy is doing well. Who knows what will happen in the future. The Council then proposed the following dates for the preliminary project schedule: Issue RFQ - March 12 Receive RFQ responses - April 9 Developer interviews - by April 22 RFP to selected respondents if necessary - April 22 Proposals due - within 30 days, May 22 Developer selection - by June I Mr. Fursman pointed out it has been suggested that a task force or focus group be established to review potential designs and uses in the commercial park. The Council felt that was a good idea and that it should include some people in town that are in business. Mr. Fursman stated he has asked Mr. Mulrooney to submit a developer proposal to the City to work on a retainer basis to help at the critical points. He would also like Mr. Mulrooney to run the focus group. He will bring that proposal to the EDA or City Council. The Council generally agreed. I, Special Andover City Council Meeting Minutes - March 9. 1999 Page 4 ECONOMIC DEVELOPMENT ISSUES - 78 ACRES SOUTH OF WDE SITE Mr. Erickson presented a proposal for the potential of streets and possible location and development of ball fields and other park facilities just south of the landfill site. The question is how much acreage should be given for parks in this development. Chairperson Blackstad also provided other options for the location of ball fields and other facilities. He stated the area adjacent the WDE site is unbuildable. At least four fields are needed to hold tournaments. His proposals included two baseball fields for age 13 and over plus some age 12 and under baseball fields. The need is there, as this year they have about 40 teams. There are no fields in the City for the older players. The parking would be shared with the businesses in the area. The plans also provide for hockey fields, free skating and the sliding hill. Councilmember Knight wondered about the possibility of the City building a dome similar to what was done in St. Paul on Rice Street. The city owns and operates it, and it is in use year round with many different uses. Staff noted that would be considered a building and could not be constructed on the area adjacent to the landfill. Councilmember Orttel felt a concern with locating the park next to the residential area would be the noise issue. The sliding hill would be a benefit as it would only be used in the winter when the neighbors' windows would be closed, thinking the northwest corner would be a good location. He also expressed some concern of using 20 acres of this site for park. Mr. Carlberg was concerned with deciding on the location of park facilities without having a master plan and design for the entire park. He wondered if the Council wished to hire the same firm who prepared the master plan for Andover Station to develop a concept for this park. The master plan for Andover Station was funded by CDBG funds. The Council suggested he obtain a proposal from the firm to develop a master concept plan for this commercial area, which would also integrate the park. ECONOMIC DEVELOPMENT ISSUES - RELOCATION OF CONNEXUS ENERGY SUBSTATION The Council suggested Connexus Energy be told the City is interested in relocating the substation further north so the area along Bunker Lake Boulevard could be commercially developed, but the funding is not available. Would they be willing to accept payment at a later time? Council member Jacobson predicted the City would never recover the money spent to develop the area. Also, visually the area would not be improved much by moving the substation. Motion by Jacobson, Seconded by Orttel, to adjourn. Motion carried unanimously. The meeting adjourned at 9:06 p.m. -,-. 4<_'.. --~--- - - -