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HomeMy WebLinkAboutIa.HEDRA Agenda Notes 04-08-2021HASTINGS ECONOMIC DEVELOPMENT & REDEVELOPMENT AUTHORITY April 8, 2021 - 6:00 pm. I. Quorum II. Minutes Please see the attached HEDRA Meeting minutes from the March 11, 2021 regular meeting for your review and approval. III. Bills March Bills Please see attached general ledger detail from the last two months for further information. IV. Business A. Hickory Creek Rentals - 2030 Spiral Blvd 1. Public Hearing: Sale of Land 2. Resolution 2021-04: Approving Purchase and Development Agreement and Business Subsidy Agreement between HEDRA and Hickory Creek Rentals, LLC. ACTION – Motion to adopt Resolution #2021-04 Approving Purchase and Development Agreement and Business Subsidy Agreement between HEDRA and Hickory Creek Rentals, LLC. B. Custom Sawdust - 515 East 31st Street 1. Public Hearing: Sale of Land 2. Resolution 2021-05: Approving Purchase and Development Agreement and Business Subsidy Agreement between HEDRA and Custom Sawdust, LLC. ACTION – Motion to adopt Resolution #2021-05 Approving Purchase and Development Agreement and Business Subsidy Agreement between HEDRA and Custom Sawdust, LLC. C. Miller Electrical - Spiral and Enterprise 1. Approve Preliminary Land Credit Sale to Miller Electrical. Miller Electrical continues to review the viability for their building to increase by at least 424 square feet to achieve the 20% building coverage Fluegel Law Firm $1,217.25 Legal - Revolving Loans, Confluence, Lot Sales WildSide Graphix $645.00 Marketing - HEDRA Land Assistance Sign of the 2.0 acre parcel. Staff will continue to work with Miller Electrical on either an increase in building footprint or a minor lot line adjustment to reduce the size of the lot so that a 17,000 square foot building achieves at least 20%. The 20% coverage is now required in order to be eligible for the land for a dollar program. Property Acquisition Options: Lot 1 Block 2 Property Size 2.0 acres Property Market Value ($1.54 per S.F) $134,164.80 Estimated Building Value $1,500,000 Construction Credit $150,000 (10% of building value) Jobs Credit TBD Cash Due Upon Transfer $1.00 Estimated Business Subsidy $134,163.80 Staff recommends approval of the Preliminary Land Credit Sale on the condition that the Applicant achieve 20% lot coverage. ACTION – Motion to approve preliminary land credit sale between HEDRA and Miller Electrical, LLC. D. Quality One Woodworking - 3005 Millard Ave 1. Approve Preliminary Land Credit Sale – Please see the attached staff report. ACTION – Motion to approve preliminary land credit sale between HEDRA and Quality One Woodworking, LLC. E. Consider Land Sale - 317 3rd Street E (Luke Siewert) 1. While HEDRA has previously considered this case, it is Staffs understanding that HEDRA would like to reconsider their action as it relates to a potential land sale and as a result has included it on the agenda for further discussion. Mr. Luke Siewert is proposing to purchase PID 19-32150-15-080 (Subject Property) for $1.00 for the purposes of combining this property with the adjacent property (PID 19-32150-15-070) to develop a 30 unit market rate apartment building. The 2021 Dakota County assessed value of the land of the Subject Property is $55,800. It has a parking lot on it currently which has a value of $5,800. However, for this redevelopment that parking lot is a liability rather than an asset. Due to questions related to the accuracy of that valuation, City Staff reached out to the Dakota County Assessor’s Office and requested that they reevaluate the assessed value of the land. The Assessor’s office concluded that the highest and best use of the property was if it was redeveloped to commercial or multifamily housing and as a result a valuation of $6.00 per square foot was an accurate value of the Subject Property based on its highest and best use. This confirmed the 2021 assessed value of $55,800. The Dakota County Assessor’s office stated that the adjacent property (PID 19-32150-15-070) which had a 2021 land value of $36,900 was undervalued in its assessed value at $4.00 per square foot. The adjacent property valuation is what sparked the request for the Assessor’s office to reconsider the value of the City owned parcel. The City has established benchmarks for purposes of providing public subsidies. Typically, those include providing adequate financial information showing a financing gap justifying the subsidy. The City may however approve a subsidy based on goals and benchmarks the City has previously established which includes the following: 1. Increase the tax base. This is not a sufficient public purpose by itself: a subsidized project must have an additional public purpose; 2. Retain existing jobs, provided that job loss is specific and demonstrable; 3. Create quality jobs. Subsidized projects are expected to add new jobs at competitive wages, unless specifically waived (see 2.02); 4. Enhance economic stability and address changes in the economy: by facilitating the development of new types of businesses, by facilitating the adjustment of existing businesses to meet new conditions and by encouraging vocational training and retraining; 5. Encourage redevelopment and development investment in city- designated areas; 6. Encourage the re-use and rehabilitation of historic properties and of sound, safe buildings, commercial and residential; 7. Enhance clean air, water and soil by facilitating the cleanup of environmental problems or assisting improvements in the treatment and management of contaminants; 8. Eliminate substandard buildings or blighting conditions; 9. Encourage the relocation of uses that are non-conforming with the comprehensive plan, zoning ordinance, Shore Lands and Critical Areas ordinances, or contribute to unsafe conditions in their present location; 10. Encourage the sustainable use of energy, resources and materials. 1.02. Not all projects assisted with subsidies must derive their public purpose and importance solely by job creation. Worthwhile projects that do not involve job creation may be approved for a subsidy given that they compensate with other public purposes. Mr. Luke Siewert is requesting a public subsidy to reduce the sale price to $1.00 based on the proposed 30-unit market rate apartment project achieving goals numbers 1, 5, 6, and 8 as outlined above. If HEDRA is supportive of the proposed public subsidy based on the above benchmarks it should motion as such. POTENTIAL ACTION – Motion to direct Staff to prepare a preliminary purchase and development agreement for the sale of PID 19-32150-15-080 for $1.00 to Mr. Luke Siewert based on achieving established benchmarks for City subsidy. F. Authorize Signature: Joint Powers Agreement – Open to Business Open To Business (OTB) is a joint effort between Dakota County and eleven cities to provide free one-on-one business consulting services and gap loan financing to entrepreneurs of new and existing businesses. Since 2013 over 50 individuals from Hastings have utilized the service and gap loans have been issued for expansion. Further information on the project can be found at www.opentobusinessmn.org. The proposed Contract for Services provides assistance through the end of 2021. HEDRA’s annual share of the contract has been reduced to $4,500 (previously $5,513). The reduction in fees reflects a gap in services from 2020 when the OTB advisor position was vacant. ACTION – Authorize Signature of the attached Joint Powers Agreement. Please see the attached Joint Powers Agreement for further information. V. Reports and Information A. Strategic Planning As Staff begins to prepare for the annual budget cycle, it is important that HEDRA review its strategic plan and update as necessary. Staff is proposing that HEDRA hold a workshop on Thursday, April 22nd from 6:00-7:00pm to review the existing Strategic Plan and provide direction to Staff on any changes in priorities related to the Strategic Plan. Strategic Plan Initiatives 1. Explore the opportunities presented by Spades 2. Meet the housing needs of Hastings 3. Work with property owners and developers to redevelop underutilized and blighted property. 4. Encourage the creation and growth of local business B. Commercial Vacancy Available February 2021 Available March 2021 Net Change Downtown 9 9 0 Highway 55 12 12 0 Vermillion Street 13 13 0 Industrial Park 3 3 0 TOTAL 37 37 0 C. Development Update Schoolhouse Square Senior Housing – Real Estate Equities plans to submit building permit plans for the 90 unit building in May and start construction in July with completion by late summer 2022. The Confluence – Exterior work is nearing full completion. City Staff was made aware that the hotel group was in Hastings in March to walk the building and make arrangements for the next phase of construction. Heritage Ridge – 116 home sites, half villa homes, half traditional single family. Located west of General Sieben Drive and south of St. Elizabeth Ann Seton Church. First phase of nine lots under construction. Council is scheduled to approve the 2nd phase of 31 lots on April 5th. Custom Sawdust – An application has been submitted for Site Plan approvals for construction of the proposed 4,900 square foot facility on Lot 5 Black 2 (adjacent to Minnesota Coaches bus facility). Planning Commission recommended approval the proposed site plan on March 22nd. The City Council will review the site plan on April 5th. Vermillion Acres – The Final Plat for the 75 unit senior facility located at 1190 County Road 47 was be reviewed by Planning Commission on March 8th and approved by the City Council on March 15th. South Oaks 4th Addition – Greg J Homes seeks Preliminary and Final Plat approval to construct 33 single family homes located southwest of 31st and Century Drive. The Planning Commission reviewed the request on March 8th . City Council will review on April 19th. Villas at Pleasant – Simek Property has submitted a new Final Plat application to construct the entire subdivision of 32 villa homes targeted towards seniors. The project was originally scheduled in two phases over a larger time period however presale interest was much greater than originally anticipated which drove the decision to complete the project in a single phase. Planning Commission reviewed the project on March 22nd and City Council will consider it on April 5th. Developer received preliminary approval to grade the site and has started doing so.. Wallin 19th Addition – 13 single family lots northeast of General Sieben Drive and River Shore Drive. Planning Commission review to occur in April. Simply Secure Storage – On March 1st, the City Council granted approval for construction of Simply Storage’s site at 2030 Spiral Blvd. Staff is working on details for transfer of the property and construction. D. BR& E Visit Report – Quality One Woodworking John Hinzman, Eric Maass, and HEDRA member Bruce Goblirsch toured Quality One Woodwork LLC on March 25th. Please see the attached report. ATTACHMENTS • Minutes – March 11, 2021 • Bills – March 2021 • Hickory Creek Purchase and Development Agreement and Business Subsidy Agreement • Resolution 2021-04: Authorize Signature for Transfer of Land for Hickory Creek Rentals, LLC. • Custom Sawdust Purchase and Development Agreement and Business Subsidy Agreement • Resolution 2021-05: Authorize Signature for Transfer of Land for Custom Sawdust, LLC. • Quality One Woodworking, LLC Staff Report Next Meeting: May 13, 2021