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Home My WebLink AboutI - HEDRA Agenda Notes 20120913HEDRA AGENDA NOTES FOR SEPTEMBER 13, 2012 MINUTES Please see attached HEDRA Meeting minutes from the August 16, 2012 regular meeting and September 6, 2012 special meeting for your review and approval. BILLS August Bills SEH Engineers $5,308.14 Hudson Demolition – Preparation of Bids & Specs Mark & Gail Borchardt $4,061.77 Borchardt Rehab Loan – 2nd Draw Finance & Commerce $314.40 Hudson Demolition – Bid Advertisement Bradley & Deike $221.00 Hoeschen Rehab Loan – Legal Fees MN Pollution Control $125.00 Hudson – Volunteer Investigative Cleanup Centerpoint Energy $70.67 Hudson – Heat ADT Security $68.76 Hudson – Security Monitoring Centurylink $45.60 Hudson - Telephone *Partial Reimbursable Expense Please see attached general ledger detail for further information. BUSINESS Resolution – Finding of Structurally Substandard Building for TIF Purposes – Hudson Manufacturing - 200 West 2nd HEDRA has informally discussed the establishment of a Tax Increment Finance District (TIF) to assist with the redevelopment of the Hudson site. Prior to demolition of the 1974 addition, certain steps must take place in order to preserve the ability to establish a future TIF district for the site. TIF allows the use of increased tax revenue achieved through improving a property to finance improvements. The increment between the present value of the property and the value of the property with improvements would be captured for use in future project development. Establishment of a TIF District is subject to certain eligibility requirements as defined in Minnesota State Statutes. Requirements include the following: Coverage Test – At least 15 percent of the parcels must contain building or site improvements. Condition of Buildings Test – The buildings must be structurally substandard. The substandard determination involved meeting both of the following: Building Code Test - The building must contain code deficiencies requiring more than 15 percent of the cost of constructing a new structure of the same square footage and type on the site. Building Conditions Test – A more subjective test relating to the overall function and defects within the structure; i.e. broken windows, roof leaks, aged finishes, etc. Compass Rose Building Performance Specialists has completed an independent analysis of the building to determine qualification eligibility. The building qualifies as substandard. Adoption of the resolution does not obligate HEDRA to establish a TIF District, but preserves the ability to include the demolished portion in determining TIF eligibility. ACTION – Adopt the Resolution 2012-06 finding the Hudson Building to be structurally substandard to TIF purposes. Please see the attached resolution and TIF Eligibility Site Assessment for further information. Resolution – Establish Interfund Loan: Partial Demolition – Hudson Manufacturing – 200 West 2nd Street. HEDRA is asked to adopt a resolution establishing an interfund loan to pay for certain qualified expenses (demolition, site preparation, and public utilities, etc.) incurred through redevelopment of the Hudson site. Funds utilized through the interfund loan would be repaid by future TIF proceeds. Adoption of the resolution does not obligate HEDRA to establish a TIF District, but preserves the ability to reimburse qualified expenses. ACTION – Adopt the Resolution 2012-07 establishing an interfund loan. Please see the attached resolution for further information. Award Contract: Partial Demolition – Hudson Manufacturing – 200 West 2nd Street. HEDRA is asked to award a contract for partial demolition of the Hudson Manufacturing Building located at 200 West 2nd Street. The bid opening is scheduled for September 11, 2012. A full bid tabulation and recommendation will be presented at the meeting. Upon award of the contract demolition would begin in early October and completed in November. HEDRA approved plans and specifications and authorized advertisement for the project at the August 16, 2012 meeting. Demolition is limited to the 48,000 s.f. addition constructed in 1974. The remaining 100,000 s.f. building is not scheduled for demolition. In June, 2012 HEDRA awarded the contract to develop demolition plans and specifications to Short Elliot Hendrickson (SEH), Inc. The engineers estimate for demolition and site restoration is $316,265. HEDRA has received $250,000 in grant funds from the Dakota Community Development Agency for the project. HEDRA would be responsible for costs incurred above $250,000. In addition to grant funding, HEDRA allocated $250,000 from the Economic Development Fund Balance for demolition and environmental costs in the 2012 budget. The successful bidder would be responsible for completing demolition per the developed plans and specifications which include: Remove the 48,000 s.f. 1974 addition Remove adjacent parking lot south of addition Remove retaining walls and exterior features. Grade site to accommodate the 8-10 foot elevation drop between the parking lot and low floor elevation of the addition. Provide erosion control and turf restoration Provide asbestos and lead paint abatement, regulated waste removal and disposal. ACTION – Award the demolition contract for the 1974 portion of Hudson Manufacturing. The recommendation and bid tabulation will be presented prior to the meeting. Please see the attached engineers estimate and site plans Resolution: Authorize 2013 HRA Levy The maximum HRA levy of .0185 percent of taxable market value is sought. The levy would yield $258,000. The continued devaluation of real estate has lowered our levy amount; last year’s levy was $295,000. The maximum levy amount is consistent with past years. The total proposed 2013 budget is $686,000, a reduction of $73,000 from this year. Reductions in redevelopment capital relating to Hudson account for most of the change. ACTION: Adopt Resolution 2012-08 authorizing the 2013 HRA Levy. Please see the attached budget summary and resolution for further information. REPORTS AND INFORMATION Hudson Redevelopment Market Study Maxfield Research has completed an Initial Market Assessment to determine the market potential for various real estate uses for the Hudson Redevelopment project. The assessment includes a review of the trade area, inventory of existing commercial uses, summary of planned uses and recommendations of real estate types that have the highest potential to be successful in today’s market. A summary of the market assessment follows: Please see the Initial Market Assessment for further information. Environmental Review Stantec is preparing a letter outlining preliminary cost estimates for site cleanup based upon a few different development scenarios. The letter should be completed before the meeting, and will be forwarded to commissioners once it is received. The Minnesota Pollution Control Agency has changed its policy regarding review of Response Action Plans (RAP). RAP’s will no longer be accepted until a developer or specific development plan has been identified. HEDRA will need to further establish development specifics prior to completion of the RAP. Further grant funds are available in the fall and spring to assist with RAP expenses. The Stantec Preliminary Environmental Cost Estimate will be provided prior to the meeting. ATTACHMENTS HEDRA Minutes – August 16, 2012 – Regular Meeting HEDRA Minutes – September 6, 2012 – Special Meeting General Ledger Detail – August, 2012 Resolution #2012-06 – Finding Hudson Property Substandard for TIF Purposes TIF Eligibility Study – Compass Ross Building Performance Specialists Resolution #2012-07 – Establishing a TIF Interfund Loan Engineers Estimate – Hudson Demolition Site Plans – Hudson Demolition Proposed 2013 Budget Summary Resolution #2012-08 – Authorize 2013 HRA Levy Initial Hudson Market Study – Maxfield Research Hudson Demolition Bid Tabulation – To be submitted prior to meeting Stantec Preliminary Cost Estimate – To be submitted prior to meeting