HomeMy WebLinkAboutHEDRA 06-11-09 IV.a Authorize Relocation Cost Study by Wilson DevelopmentJune 4, 2009
Mr. John Grossman
Hastings HRA
1014`h Street East
Hastings, MN ss033-1944
Dear Mr. Grossman:
I am writing to submit a proposal to provide acquisition and relocation consultant services for the
possible acquisition and relocation of the Hudson Manufacturing's Hastings plant. We are proposing a
phased approach that will permit the City/HRA to determine the level of interest and economic
feasibility for all parties, and then move to the actual implementation phase of acquiring the property
and relocating the industry.
Project Understanding
The existing Hudson Manufacturing site is being impacted by the MnDOT Bridge project. MnDOT will
acquire the warehouse portion of the property in a partial acquisition and will impact access to the
property during construction. MnDOT will present an offer to acquire a portion of the site some time
after July 1, 2009. MnDOT is seeking possession by the summer of 2010.
The Gity/HRA has an interest in the property for riverfront redevelopment project as well as retaining a
major local industry. There is a possible existing industrial building for sale in Hastings that may be an
acceptable replacement relocation site for the Hudson Manufacturing business. There is some sense of
urgency as the possible replacement site may have additional interested parties.
The Gity has retained the services of an industrial engineer to assist in quantifying the financial impact of
a possible Hudson Manufacturing plant relocation.
The City is now seeking assistance to quantify the cost to comply with the Uniform Relocation Act should
the City become involved in the acquisition of the existing factory.
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Phase Approach
1. Pre Acquisition Feasibility
a. Provide relocation cost estimate to move the plant to a replacement facility in Hastings.
b. Explain Uniform Relocation Act responsibilities to the City representatives and Hudson
Manufacturing representatives.
c. Discuss "minimum compensation" acquisition method to value the acquisition price of the
remaining portion of the Hudson site. I understand that this is a voluntary sale with no
threat of eminent domain action by the City/H RA. The 2006 Eminent Domain law did
establish an additional method to determine the level of compensation called minimum
compensation. It is based upon the replacement cost of a facility rather than the fair market
value of the existing site. The reality is that this approach may very well be helpful in trying
to arrive at a negotiated settlement with Hudson Manufacturing.
2. Implementation
a. Acquisition
1. Negotiate the purchase of the existing Hudson Manufacturing plant with Hudson
Manufacturing representatives.
2. Draft the purchase agreement for City/HRA review and approval.
b. Relocation
1. Assist Hudson Manufacturing submit a relocation claim incompliance with URA. It is
understood that most of the equipment is old and may not actually be moved.
Substitute equipment relocation claims would be provided.
c. If the minimum compensation approach to valuation is utilized, we would prepare a
Minimum Compensation Value Damage Report detailing the analysis.
Proposal Price
We are proposing a time and material approach as the project is somewhat undefined in the sense of
the interest and cooperation we will have with Hudson Manufacturing, or what it may take to build their
interest. We would only charge for the time and assistance provided at the Gity's direction.
2009 Charee Rates
Principal $95.00
Associate $85.00
Office Manager $65.00
Copies 15 each
Mileage IRS Allowed Rate
Postage, Courier, etc. At Cost
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For budget purposes you could use the following schedule to anticipate the cost of our services.
Pre Acquisition $2,600
Relocation cost estimates with meetings to discuss estimate
with City and Hudson Mfg. and discuss strategy or approach
Implementation
Acquisition $3,000
Relocation $3,500
Minimum Compensation $1,500
Thank you for the opportunity to submit this proposal. If you have any questions, please call me.
Sincerely,
Daniel H. Wilson
Chief Manager
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