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HomeMy WebLinkAbout05-12-11 HEDRA PacketHASTINGS ECONOMIC DEVELOPMENT & REDEVELOPMENT AUTHORITY . Agenda for May 12, 2011, 6:00 pm City Hall Council Chambers I. Quorum II. Minutes – April 21, 2011 Regular Meeting - May 3, 2011 Special Meeting III. Bills IV. Business V. Reports and Information A.HEDRA Workshop – June 9th B.Hudson C.TH 61 Bridge D.Marketing E.Hard Wired Alarm RFP V. Adjourn Next Meeting: HEDRA Workshop - June 9, 2011 HEDRA AGENDA NOTES FOR MAY 12, 2011 MINUTES Please see attached HEDRA Meeting minutes from April 21, 2011 regular rd meeting and May 3 Special Meeting for your review and approval. BILLS April Bills st Dakota County $32,234.36 Hudson Taxes – 1 Half* EW Concrete & Masonry $1,582.00 Hudson Window Fill* Himle Horner $553.00 Marketing Services - March Mastercard $4.00 Parking - DEED *Hudson Taxes and Window fill are reimbursable expenses from Hudson, and MnDot, respectively. Please see attached general ledger detail for further information. BUSINESS REPORTS A.HEDRA Workshop – June 9th th HEDRA will hold a workshop in lieu of the regularly scheduled June 9 Meeting. Please see the attached draft agenda for review and comment. Window Blocking Masonry work on the blocking of five windows on the east side of Hudson has been complete. The winning bid from EW Concrete and Masonry was $1,482; and less than originally estimated. MnDot will reimburse HEDRA for the work completed. B.Hudson th Approval of Grant Funds – On April 19, the Dakota CDA authorized $145,000 in grant funds to HEDRA for use in demolition and environmental remediation of the Hudson site. Submittal for DEED and Met Council Environmental Funding – Applications for environmental cleanup funding have been submitted to both DEED and Met Council. The funding would be used to complete the remaining Phase II environmental review (more site testing to determine extent of contamination) and to develop a RAP (Response Action Plan). The estimated costs for the activities are $56,000. Staff plans to complete environmental analysis of the site between now and fall, and to apply for further clean-up dollars in November. Dakota County\US EPA Assessment Grant – Dakota County has secured $400,000 in environmental assessment grant funds from the US EPA. HEDRA has submitted a request to receive funding. Hudson Taxes – Per the Post Closing Occupancy Agreement, HEDRA is liable to pay all taxes in 2011. Hudson is obligated to reimburse taxes on a pro-rata basis. We will submit a request to Hudson for reimbursement of the $32,000 in st 1 Half Taxes shortly. C.TH 61 Bridge MnDot will be completing the temporary Block 29 Parking lot shortly. Temporary gravel has been laid. The parking lot would be operational until fall, 2011, and should accommodate construction and staging of the potential Carlson Office Building. Piers are taking shape on the south end of the site. Work in the river is behind schedule with the flooding. D.Marketing Currently Himle Horner is in the process of making the audit calls. From the list of roughly 25 local business owners and developers Himle Horner will be in contact with about 8-10 of these people. The intent is that neither HEDRA nor staff knows which businesses are contacted. We will have some “big picture” preliminary results from these calls at our next meeting in June. E.Downtown Hard Wired Alarm RFP th A pre-bid open house for potential RFP respondents was held on April 26. About 15 firms were present and have expressed interest in responding to the st Bids are due June 1. Work on the 35 mixed use buildings should be complete within nine months. ATTACHMENTS HEDRA Minutes – April 21, 2011 – Regular Meeting ¼ HEDRA Minutes – May 3, 2011 – Special Meeting ¼ General Ledger Detail – April, 2011 ¼ th Draft Agenda – June 9 Workshop ¼ Hastings Economic Development and Redevelopment Authority 6:00 pm Hastings City Hall Minutes of April 21, 2011 HEDRA Commissioners Dennis Peine, Pam Holzem, Ron Toppin, Danna Elling Schultz, Michael Kelley Kurt Keena, and Tony Alongi present Staff present: Community Development Director John Hinzman and Community Relation Specialist Shannon Rausch. Guests Present: Greg Stotko, Jeff Carlson and Matt Frisbie Q: UORUM A quorum was established and the meeting was called to order, by Chair Toppin at 6pm with 6 members present. I.M INUTES Commissioner Keena motioned to approve the minutes from the March 10, 2011 meeting, Commissioner Holzem seconded the motion. Motion approved 6-0 III.B ILLS Commissioner Keena moved to pay the bills. Commissioner Peine seconded the motion. Motion Passed 6-0 Commissioner Alongi Arrived IV.B USINESS A.Block 29 Concept Plan Greg Stotko presented a concept plan on behalf of Carlson Capital Management for the construction of a new office building located south of City Hall on Lots 1 and 3, Block 29. Mr. Stotko proposes to construct a single story building of 3,770 s.f. along with 18 parking spaces. HEDRA and Stotko entered into a Preliminary Development Agreement in 2009. The agreement was based upon the development concept of a two story, 6,500 s.f. office building housing two to four office suites. A purchase price of $1 was offered for the property. The purpose of the agreement is to allow the developer to assemble further information and to refine the concept plan for potential future action. The HRA purchased the property for $300,000 in 2003 and razed the former home. The property was last appraised for $255,000 in 2007. 1 Minutes – Hastings EDRA – 04/21/11 Page The Commission discussed the project in depth. Much time was spent on the fact that the development agreement was for a two story, 6,000+ s.f. multiunit office building, not a single level building that was half the size. The Commission struggled with how to justify selling the land for the project for $1 and what the “return on investment” exactly would be. Several commissioners stressed that they liked the project and how well the exterior of brick and stone would fit with the surrounding neighborhood, (i.e. City Hall, Guarding Angels Apartments, the salon next door, etc.) Throughout the discussion the reasons why the HRA bought this property eight years ago were emphasized: To remove blight, which they did when they razed the existing duplex that had been there. To control what was built in this location, which they are currently doing. And to be able to keep the large oak trees on the property, which this proposed project does as well. The biggest concern that was discussed was that this is a much smaller – nearly 3,000 sf smaller – than what the Commission was looking for. And does that warrant a land price of $1 when the county last assessed the property to be about $140,000? The commissioners agree that the market has changed drastically since they first bought the property several years ago, and even since they entered the Development Agreement with Stotko Speedling two years ago and they have to be realistic. Understanding that this project is on a very fast track due to the fact that Carlson Capital Management has to be out of their exist space by the end of the summer and would like to be in their new location by September, the Commissioners asked that before they authorize the purchase agreement, that the Developer come back with more specific numbers for costs, a more detailed elevation so commissioners can get a better sense of how this fits into the neighborhood, and a better sense of the tax amount. A special meeting is expected to be set for sometime in the next two weeks. Commissioner Elling Schultz Left IV.R&I EPORTS NFORMATION A. Hudson Update th Reuse Study Workshop – was held April 5. Stark and Associates ran the workshop very well and did a good job of soliciting community input on potential uses for the Hudson Manufacturing site. About 40 people were in attendance. Reusing the building and preservation of riverfront park land were dominant themes. Ideas for building use were numerous including retail, restaurant, and housing. There have been no decisions on what might happen to the site. The study should be complete by September and will provide more clarity on the structural condition of the building, costs involved in the potential re-use, and desirability of potential rehab from the private market. The final report will assist the City and HEDRA on making informed decisions on the costs of potential development options. Window Blocking Masonry work on the blocking of five windows on the east side of Hudson has been complete. The winning bid from EW Concrete and Masonry was $1,482; and less than originally estimated. MnDOT will reimburse HEDRA for the work completed. 2 Minutes – Hastings EDRA – 04/21/11 Page B. TH 61 Bridge Update MnDOT is beginning utility work along Vermillion Street between 4th and 5th Streets. The temporary parking lot on Block 29 should be constructed soon, (and will not affect the potential Carlson Capital Management project, should that be approved and go forward.) Works remains suspended within the River. C. Marketing Update Our marketing project continues to move forward with the next step being the audit calls. Late last month staff developed a contact list of roughly 25 local business owners and developers and provided this list to Himle Horner so they can then contact 8-10 of the people on the list. The intent is that neither HEDRA nor staff knows which businesses are contacted. This allows those businesses contacted the opportunity to speak freely. Since providing Himle Horner the list, they have has sent staff a template for an email that we will be sending out to all of the contacts, letting them know that they may be getting a call. This is to ensure that the businesses understand that this is legit and that HEDRA hopes they will be willing to participate in the short survey. Also at the same time, Himle Horner is also conducting some research on what other cities of similar size and make up are doing (or not doing) to market themselves. (Red Wing and Stillwater are on this list.) D. Downtown Hardwired Alarm The RFP has been released to interested alarm installers and has been posted on the City’s website. A pre-bid meeting for potential bidders will be held next week on April th 26. Bids are due June 1st. Work on the 35 mixed use buildings should be complete within nine months. E. HEDRA Goals and Objectives Staff proposes holding a special workshop to discuss HEDRA Goals and Objectives in place of the regular June HEDRA meeting. A list of topics will be developed for HEDRA consideration in May. F. Red Rock The final Red Rock Station Area Plan Meeting was held on April 6th. Final copies of the proposed station area changes will be complete soon and will be distributed to HEDRA. A: DJOURNMENT Commissioner Keena moved to adjourn at 7:15 pm, Commissioner Holzem seconded. Motion Passed 5-0 Next meeting is scheduled for Thursday, May 12, 2011 at 6:00pm in the Council Chambers. Shannon M. Rausch 3 Minutes – Hastings EDRA – 04/21/11 Page Hastings Economic Development and Redevelopment Authority 7:30 am Hastings City Hall SPECIAL MEETING Minutes of May 3, 2011 HEDRA Commissioners Dennis Peine, Ron Toppin, Danna Elling Schultz, Michael Kelley, Kurt Keena, and Tony Alongi present HEDRA Commissioners Pam Holzem absent Staff present: Community Relation Specialist Shannon Rausch. Guests Present: Greg Stotko and Jeff Carlson Q: UORUM A quorum was established and the special meeting was called to order, by Chair Toppin at 7:35am with 6 members present. I.B USINESS A.Block 29 Concept Plan Greg Stotko and Carlson Capital Management met with HEDRA to provide more detailed information about the proposed construction of a new office building located south of City Hall on Lots 1 and 3, Block 29. As discussed at the regular April 21, 2011 HEDRA meeting, this new development would be a single story building with 3,770 s.f. of office space and would include around 14-18 parking spaces. Mr. Stotko discussed the various minor changes they have made to the plans since it was first presented to HEDRA two weeks ago. These changes were made in an effort to better protect and preserve the mature trees currently on the property that HEDRA has required any development to leave untouched. Other modifications have been made to the originally presented plans for parking, but still the number of stalls will exceed the requirements. The meeting was then opened to questions from the Commissioners. Commissioners asked for better clarification as to why the originally agreed upon development of a two story, 6,500 s.f. office building is no longer being considered and why this new, single story, 3,700 s.f. building should be accepted. Reasons given included that fact that the market isn’t today what it was a few years ago. Also that this project would be a step up from what was offered in the Development Agreement, (this project would include a lot of brick and stone in the façade which was not in the original project.) It would be owned solely by one company which anticipates growth in its company’s future, rather than having rental space which can end up sitting vacant for long periods. This business fits the location in not 1 Minutes – Hastings EDRA – 04/21/11 Page needing great visibility as it is a destination type business. It would move 5-6 new jobs to Hastings which currently are not in town, as well as bringing 4-6 high-end clients to town daily (who would not otherwise be likely to come to town.) All this, plus the added fact that the client would like to work with as many local contactors and tradesmen as possibly to build this project in their opinion justify the smaller scaled building for the same priced land. Discussion was had on the large amount of office/commercial space currently available throughout Hastings and why it wouldn’t be better to fill one of those vacancies rather than building yet another office building. The Client has rented/leased his past six locations and is tired of not being in control. He would like to own his own building and by building, rather than remodeling he can get exactly what he wants without settling or spending as much. Conversation were also had regarding the fact that HEDRA needs to justify selling the land to the developer for $1, rather than a price more in line with the market value, which was last assessed at $140,000. When compared to the Industrial Park projects where land is sold per acre, with requirements of staying in business for 5 years and bringing a certain number of jobs at a certain pay rate and HEDRA typically invests about 5-7% into these projects. This project HEDRA would be a much bigger investment for HEDRA with the total investing somewhere between 15 – 19%. How does HEDRA justify this when future project come forward asking for assistance? Discussions continued, and it was pointed out that HRA acquired this property to get rid of blight, control the site and keep the trees. HEDRA entered into the Development Agreement with Stotko Speedling in 2009 to help HEDRA find someone who would work within the commissions parameters. HEDRA put tougher restrictions on this property than typically seen in the Industrial Park where HEDRA sells then empty land with no restrictions. The commissioners agreed that with this project HEDRA would be getting high paying professional jobs in town, not just your average $12 - $18/hr positions. The developer and his client are working within the parameters and keeping the trees, which is not and easy task. And the proposed building is higher quality than what was initially proposed in the Development Agreement, even if it’s smaller. Commissioners also agreed that they currently own a lot of property, it’s time to start developing some of it. If HEDRA denies this project which has many positives (listed above) what exactly is it that the Commission is holding out for? After further discussions Commissioner Keena motioned to approve the concept plan and grant staff the authority to prepare the purchase agreement, motion was seconded by Commissioner Kelley. Motion passed 6 - 0 A: DJOURNMENT Commissioner Keena moved to adjourn at 8:35 am, Commissioner Keena seconded. Motion Passed 6-0 Next meeting is scheduled for Thursday, May 12, 2011 at 6:00pm in the Council Chambers. Shannon M. Rausch 2 Minutes – Hastings EDRA – 04/21/11 Page **DRAFT AGENDA FOR COMMENT** HASTINGS ECONOMIC DEVELOPMENT & REDEVELOPMENT AUTHORITY WORKSHOP . Agenda for June 9, 2011, 6:00 pm Volunteer Room I. Quorum II. Review Administration and Management Practices Document III. Review Progress on Roles & Goals – June, 2009 IV. Discuss Future Goals, Objectives, and Priorities V. Develop Draft Work Plan VI. Adjourn