HomeMy WebLinkAboutEDA December 20, 2005
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1685 CROSSTOWN BOULEVARD N.W. . ANDOVER, MINNESOTA 55304 . (763) 755-5100
FAX (763) 755-8923 . WWW.CI.ANDOVER.MN.US
ECONOMIC DEVELOPMENT AUTHORITY
MEETING
December 20, 200S
6:00 p.m.
Conference Rooms A & B
AGENDA
1. Call to Order - 6:00 p.m.
2. Approval of Minutes (12/06/0S Regular Mtg.)
3. Review Bunker Lake Boulevard Redevelopment Options
\ 4. Other Business
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:'1. Adjourn
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1685 CROSSTOWN BOULEVARD N.W. . ANDOVER, MINNESOTA 55304. (763) 755-5100
FAX (763) 755-8923 . WWW.CI.ANDOVER.MN.US
TO:
Economic Development Authority [:)
Jim Dickinson, Executive Director ~
Vicki V olk, City Clerk ~
CC:
FROM:
SUBJECT:
Approval of Minutes
DATE:
December 20, 200S
INTRODUCTION
The following minutes were provided by TirneSaver Secretarial for approval by the EDA:
December 6, 200S
Regular Meting
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DISCUSSION
Attached are copies of the minutes for your review.
ACTION REOUlRED
The EDA is requested to approve the above minutes.
Respectfully submitted,
ILL. ()~
Vicki V olk
City Clerk
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DRAFT
ANDOVER ECONOMIC DEVELOPMENT AUTHORITY MEETING
DECEMBER 6, 2005 - MINUTES
A Meeting ofthe Andover Economic Development Authority was called to order by Vice President
Julie Trude, December 6,2005,6:00 p.m., at the Andover City Hall, 1685 Crosstown Boulevard
NW, Andover, Minnesota.
Present:
President Gamache, Commissioners Don Jacobson, Mike Knight,
Ken Orttel, Julie Trude; Voting resident members Joyce Twistol
and Robert Nowak;
Edward Schultz, Advisor to the EDA
Executive Director, Jim Dickinson
Community Development Director, Will Neumeister
City Engineer, Dave Berkowitz
Others
Absent:
Also present:
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APPROVAL OF MINUTES
November 15, 2005: Correct as amended.
Commissioner Trude stated on page 2, second paragraph after agreement, the sentence should read
"Commissioner Trude felt the agreement should encourage timelv performance or the terms would
need to be renegotiated."
MOTION by Trude, Seconded by Jacobson, approval of the Minutes as written. Motion carried 3
ayes, 2 abstain (Twistol, Knight), 2 absent (Gamache, Orttel).
ANDOVER STATION NORTH DEVELOPMENT IMPROVEMENTS
Mr. Neumeister provided an update to the Commission on the status of all the various dealings
and construction projects that have been underway.
Mr. Dickinson noted staff contacted Play Ventures with $3.75 a square foot for the useable part
and they were offered $2.50 a square foot for park. $2.75 was offered for the area under the
power line easements, which they originally indicated they did not want to pay for.
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Commissioner Trude wondered ifthe original offer excluded the same area. Mr. Dickinson
stated they are having them pay for the area they originally were unwilling to pay for because
there is benefit of what is underneath the easements, especially for parking.
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" Andover Economic Development Authority Meeting
Minutes - December 6, 2005
Page 2
Mr. Neumeister stated Tony Howard asked about all the available land. Commissioner Jacobson
wondered if it would be for general building on all of it. Mr. Neumeister stated they would bring
forward separate proposals on the different parcels.
Commissioner Orttel arrived at 6:10 p.m.
Commissioner Jacobson wondered if there is interest on the parcel by a bank, why they would
want to give an option to Tony Howard for it. Mr. Dickinson stated the bank would not want the
entire piece, only half and they could work out something with Tony Howard.
Mr. Neumeister wondered if the Commission wanted to see where the bank would want to go
before they would give an option to Tony Howard.
Mr. Neumeister stated they are trying to get file closure letters from the MN Pollution Control
Agency.
J
Mr. Berkowitz stated they are also working with VIC on this where they will send a no further
action letter. He stated they also have found acetone from the landfill area and staff contacted the
landfill and they thought this may be a possible contaminant from cleaning their lab equipment.
They are aware ofthis but do not think it is because of the landfill.
Mr. Neumeister stated they are working with the EP A on getting residential to be allowed to be
developed on the land because they have a deed restriction on the land indicating only
commercial would be allowed. Mr. Dickinson stated it is stalled in the Attorney General's
office. Mr. Neumeister stated the Attorney General has signed a letter requesting that the deed
restriction be removed.
Commissioner Jacobson wondered when they will actually start selling land. Mr. Dickinson
reviewed the timelines for the different proposed developments.
Commissioner Trude stated in the Bruggeman Development, they have to make sure their design
standards are met and open space is met.
Commissioner Trude wondered if they want to expand the design standards along Hanson and
Bunker Lake Boulevard in case some of the properties sell and change hands. She thought they
should have the City Attorney look at that.
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LETTERS OF INTENT/PURCHASE AGREEMENTS REVIEW
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Mr. Dickinson indicated there have been no new "Letters ofIntent" received. There has been a
new purchase agreement, for Tony HowardINorthwest Commercial, recently written by City
Attorney Hawkins that was authorized by the EDA in November.
)
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Andover Economic Development Authority Meeting
Minutes - December 6, 2005
Page 3
Commissioner Jacobson wondered if the option is tied into the purchase agreement. Mr.
Neumeister stated it is.
Mr. Nowak wondered if Mr. Howard wants the option but only ifthey can agree on the purchase
and is this contingent on the signing of the purchase agreement. Mr. Neumeister stated that was
correct.
Commissioner Orttel wondered what they were charging for options. Mr. Neumeister stated it is
around $20,000. Mr. Dickinson stated they would put an inflator on the land of about ten percent
and then $20,000 on the property would be appropriate.
Commissioner Knight wondered if the green area on the map is land that cannot be used. Mr.
Berkowitz stated it is wetland and has a conservation easement over it and the association will
maintain it. Mr. Neumeister stated it is listed in the association documents.
Commissioner Orttel wondered if there is anything in the purchase agreement indicating the
owner would become a member of the association and would be required to provide for
" maintenance. Mr. Berkowitz stated there is no real maintenance on the wetland other than the
small ponds on them.
Commissioner Knight wondered who would have liability for the wetland. Mr. Berkowitz stated
he could not answer that. He stated it is just like a storm water pond in any development.
Commissioner Jacobson wondered if they have a broker for any of the property. Mr. Dickinson
stated they do not.
Commissioner Jacobson wondered if normally they have a legal description of the property in the
purchase agreement. Mr. Dickinson stated it will be added after Commission review.
Commissioner Knight wondered if Mr. Howard would sell or lease the buildings. Mr.
Neumeister thought they would be built to sell.
Mr. Neumeister stated they will put exhibit attachments on the purchase agreement.
Motion by Jacobson, Seconded by Orttel, to approve the concept 'plan for the purchase agreement
with an addition of referencing the lot description and adding an Association. Motion carried
unanimously.
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OTHER BUSINESS
Commissioner Jacobson wondered how the ballfield development is going. Mr. Dickinson stated
the ballfield development will be tied to feasibility reports of three public improvement projects.
There will be one master feasibility study and then four sub-feasibilities, one for the ballfield
/ Andover Economic Development Authority Meeting
Minutes - December 6, 2005
Page 4
and one for each individual development and then they will consolidate them into one and issue
bonds and assess back to the park dedication fund this project and facilitate this to take place in
2006 for playability in 2007. It would include the parking lot and field and fences but not lights.
Commissioner Trude wondered how they will access the ball fields. Mr. Berkowitz stated the
roads will be in. He reviewed the process in order to get Jay Street done and the signal lights on
Hanson Boulevard.
Mr. Berkowitz stated he met with Mr. Jerry Putnam and he is fine with the deferred assessment
and he also talked to Scott Allen. He noted he has one more property owner to meet with.
President Gamache arrived at 6:35 p.m.
Commissioner Knight wondered ifthe baseball association is in agreement on the sizes. Mr.
Berkowitz stated they are and he thought they maximized the site.
Mr. Dickinson stated lighting is an incentive for the baseball association to raise funds through
their charitable gambling fund.
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Commissioner Orttel thought they would need a building for storage there. Mr. Dickinson
thought the baseball association would put in a building onsite before they put in lighting.
Commissioner Knight thought they would need a building with bathrooms. Mr. Berkowitz stated
they will be running sewer and water to the park.
Mr. Dickinson wondered if there are any projects the Commission wants added or to continue to
pursue after the budget presentation. Commissioner Trude stated at the Council meeting they were
talking about CDBG projects. She wondered if it made sense to do the Hughs Industrial area
separate or do they wait until the sewer line comes up through the Rural Reserve and connect it and
have it all be sewered. Commissioner Orttel thought it would change the uses and possibly make it
more retail.
President Gamache wondered if Kottke owns everything from where they are up to Round Lake
Boulevard. Mr. Dickinson stated they do not own Eddy's and a broker working with Kottke's
indicating they want the parcel if Eddy's were to sell.
Mr. Neumeister reviewed possible development of the area in front of Kottke's Bus on Bunker Lake
Boulevard.
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President Gamache wondered ifthey should make Grouse Street as the main street and close offthe
entrance to Spur. Mr. Dickinson thought the County would want that access shut down if they
brought in a loop road.
Ms. Twistol wondered if Spur decides they cannot economically make it, does the EDA have the
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Andover Economic Development Authority Meeting
Minutes - December 6, 2005 .
Page 5
money to buy the parcel. Mr. Nowak thought they could put it in the TIF plan. Commissioner Trude
wondered if staff could keep in contact with the owners indicating the City would be interested in
possibly purchasing the property if the gas station closed.
Motion by Jacobson, Seconded by Knight, to adjourn. Motion carried unanimously. The meeting
adjourned at 6:55 p.m.
Respectfully submitted,
Susan Osbeck, Recording Secretary
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CITY OF
NDOVE
1685 CROSSTOWN BOULEVARD N.W. . ANDOVER, MINNESOTA 55304. (763) 755-5100
FAX (763) 755-8923 . WWW.CI.ANDOVER.MN.US
TO:
CC:
EDA President and commissioner~n
Jim Dickinson, Executive Director ~
Will Neumeister, Director of Community DevelopmentWL-
FROM:
SUBJECT: Bunker Lake Boulevard Redevelopment Options
DATE:
December 20, 2005
INTRODUCTION
The issue was identified in the Council goal setting for 2005-06 and this memo will serve as
an update on the potential to redevelop sections of Bunker Lake Boulevard. This was last
discussed with the EDA on June 25, 2002 (minutes of that meeting are attached). At that
time, the focus was on redeveloping the area between Crosstown Drive and Crosstown
Boulevard. This report will bring that back into focus and also briefly describe other options
to potentially redevelop some of area between Jay Street and Hanson Boulevard.
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DISCUSSION
Crosstown Drive to Crosstown Boulevard Redevelopment Options:
Option I-Since the EDA last discussed this issue, the City has strengthened rental licensing
requirements. These housing units are primarily rental and by increasing the standards and
licensing requirements it should prevent major unchecked degradation of the rental units. The
City has also used CDBG funds to offer low interest loans to help make repairs or upgrades to
the units. As more money becomes available from land sales in Andover Station North, the
EDA could consider adopting a cost-sharing program to help upgrade the outward
appearances (i.e. painting, lawnllandscaping upgrades, new pavement, addition of curbs and
drainage, seal coating, etc.). This ultimately may be a very reasonable cost to implement
compared to other alternatives that are to follow.
Option 2- The City could set up a new Tax Increment District (Redevelopment District for 25
years) and do site acquisition, relocation, demolition of all the units in the area and then resell
the cleared site to a developer for either town homes or a limited number of apartments.
Estimated expenses in implementing this option include the following:
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Land Acquisition
Relocation
Legal
TIF District Setup
$ 9,100,000
$ 1,000,000
$ 50,000
$ 25,000
Structure Demolition
Well Capping
TOTAL
$ 450,000
$ 15.000
$ 10,640,000
There are currently 78 housing units on the property, of which only six are estimated to be
owner occupied.
To recover/fmance these costs, the EDA would need to market the property to a developer and
it is estimated that the gross site area could accommodate approximately 100 housing units
that would be valued at approximately $250,000 per unit. The sale ofland would generate
approximately $3,000,000. The project would produce approximately $3,600,000 of
increment over 25 years if the units were owner occupied. This would result in a gap of
approximately $4,000,000 to the EDA that could be filled with funds from the Andover
Station TIF district (staff needs to research this through legal counsel to determine that it is
possible).
Option 3- The third option is to consider a mixed-use development where town homes and
offices would equally share the site (i.e. offices along Bunker with town homes along the
wetland edge). Based on the projections staffhas made, there would be $3,800,000 of
potential total land sales. Estimated valuations are based on eight office buildings that would
be similar in style to the ones on Station Parkway near the movie theatre. There would also be
approximately fifty town homes at $250,000 per unit valuation (for a portion of the site). This
combination would yield $2,940,000 in increment over 25 years and result in a gap of
$3,900,000.
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Area between Jay Street and Hanson Boulevard
Some properties in this area are currently for sale. The relocation of the businesses currently
operating on the sites would be a great expense and could involve challenges related to use of
eminent domain. The owners of Kottke's Bus Company have indicated that they are not
interested in moving unless another desirable site is found and all relocation costs are paid. If
they are that fIrm in their beliefs, then they would probably challenge the use of eminent
domain in court unless the EDA could reach payment and terms that are agreeable to them.
Kottke's owns all the property between Grouse Street and Jay Street except for the northwest
corner, where Eddie's Auto Body (assessors value $312,000) is located. The Kottke property
currently for sale along Bunker is on the market at $12 per square foot and would have a total
price tag of$I,100,000.
It could be argued that the only site the City needs to acquire is the Eddie's Auto Body site
and then begin to work with Kottke's to establish a redevelopment plan that they could
implement with very little City fmancial assistance. The owner of Eddie's has indicated that
he wants to stay there for the next three years, until he is ready to retire. This could be an
opportunity to negotiate a purchase with a willing seller with occupancy and removal of the
structure three years from now.
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The attached drawings show the area and how the parcels currently exist and what physical
constraints exist that may impede redevelopment of this area. For example, the narrow space
between Bunker and the north edge of Kottke's bus barns, as'well as the limited access to
Bunker.
There are a couple of options that could be discussed. What vision does the EDA have for the
long-term reuse of the area (i.e. office, restaurant site or retail development); or possibly auto
related maintenance or car wash?
It is possible that the land owned by Kottkes could remain under their ownership and become
a private redevelopment project with the City working with them to offer planning and
direction on how the site could be reorganized to relocate their bus storage to the southern
portion (where Great American Bus Company leases space from them). This could open up
some possibilities. One possibility is that the northerly 100 feet of Kottke's bus storage area
could be cleared and added to enlarge their vacant development site fronting on Bunker. The
activities of clearing the land and relocating the bus barns could be something the EDA may
want to consider funding a portion of the costs to facilitate the move and open up more usable
space along Bunker.
This approach may yield a desirable development along Bunker and still allow Kottkes to
remain. This is something that EDA should discuss, as it may be the most cost effective
way to redevelop the sites that have frontage along Bunker. This approach would also leave
the most of the costs of holding and developing the land in private sector hands.
The Spur Gas Station site could be viewed as a prime redevelopment site, however, it
probably will be difficult to site a new building on the corner because of Anoka County
limiting access to either Bunker or Hanson. There are two power line easements that
/ restricts the size and type of building that can be placed there and the power lines may be seen
as a negative to someone that may be interested in buying the property. Again, unless there's
a willing seller this may be a very expensive site to acquire.
ACTION REOUESTED
The EDA is requested to discuss the various options of redevelopment of property along
Bunker Lake Boulevard and provide staff direction for new options or if any of the options
presented should be pursued.
Respectfully SUbrni~
Will Neumeister
Attachments
Minutes of June 25, 2002 EDA meeting
Drawings
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) Economic Development Authority Meeting
June 25, 2002 - Minutes
Page 4
. Bunker Lake Redevelopment Project Area Options
Mr. Neumeister reviewed his memo to the EDA regarding three options available to them
for the redevelopment of the Bunker Lake Boulevard area. The options include
strengthening the rental licensing requirements and inspection of the rental units, setting
up a new Tax Increment District to do site acquisition, relocation, demolition and resale
of the property, or consider a mixed-use development.
Mr. Erar noted that there was a presentation at the League of Minnesota Cities
Conference regarding a program where the EDA would own the land in perpetuity and
there would be restrictions where the owner could not sell the home for more than a
certain percentage of the increase in the value. He also suggested that the EDA might
want to consider using the TIP funds from Andover Station to redevelop this area.
Cbl'Y\m', ':::.SI"..... 'tv
Cm:!ficilmemOOr Orttel felt that a buffer could be put along Bunker Lake Boulevard and
asked what the cost to plant pine trees would be.
Mr. Neumeister stated that staff would look at how the city can upgrade the standards for
the type of housing that is in place. They will also put together an estimate of
landscaping costs and investigate a revolving loan fund.
Other Business
00"\,,\ Y"Y"'\ ( ~S:.\C)ti~"'-
,Col111cilmember Jacobson asked how the roof on Tanner's Steakhouse is looking. Mr.
Erar noted that they are trying to find something to disguise the roof units.
Motion by Orttel, seconded by Knight to adjourn. Motion carried unanimously.
Meeting adjourned at 9:50 pm.
Respectfully submitted,
ttL !.t.a
Vicki V olk
City Clerk
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