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12-02-2013 CCM JT HRA d City t ElLk) joint Special Meeting of the Elk River City Council PdVer and Housing and Redevelopment Authority Held at Elk River City Hall Monday, December 2, 2013 i Members Present: Mayor Dietz,Councilmembers Wilson,Motin,and Westgaard (6:27 p.m.) HRA Commissioners Chuba,Kuester,and Toth Members Absent: Councilmembers Burandt and Commissioner Kuester Staff Present: City Administrator Calvin Portner,Community Operations and Development Deputy Director Manager Jeremy Barnhart,Director of Economic Development Brian Beeman,and Senior Administrative Assistant/Recording Secretary Jennifer Johnson Call Meeting to Order Pursuant to due call and notice thereof, the meeting of the Elk River City Council was called to order at 5:46 p.m.by Mayor Dietz. 2.1 Discuss Housing Survey and Develop Housing Tax Increment Financing Scoring Worksheet Mr.Beeman presented the staff report. He introduced Springsted Consultant N ikaela Huot, who reviewed the draft application scoring worksheet with the Council and commission members. The following areas of the worksheet were discussed and adjustments suggested: Under question 1 of the application worksheet,"The policy meets the criteria set forth in Section IV of the city's Tax Increment Financing policy,"Ms. Huot reviewed the TIF policy sections asked if the overall policy should be adjusted. She noted the policy as currently worded remained in compliance with state statute,There were no comments regarding question 1. Under question 2, "Ratio of Private to All Public Investment in Project,"Councilmember Motin suggested no points be awarded if the ratio was less than 2:1.Discussion ensued regarding whether or not to assign 0 points versus 1 point if some aspects of a project don't meet specific thresholds. Ms. Huot stated some projects may have areas that still qualify it as a worthy,viable project,but may have areas that don't meet all thresholds even by assigning 0 points. It was decided to consider each project in a case-by-case basis. Under question 3, "Job Creation in the City of Ella River,"Commissioner Chuba noted his concerns with the number of jobs retained being viewed as significantly less valuable than the new creation of jobs. He felt it more a penalty not attempt to retain businesses who may wish to relocate. Councilmember Motin felt it important to remain consistent between both industrial and housing project types. Ms. Huot agreed and noted other cities differ across the board, depending upon whether or not retainage of current jobs is more important than creating new jobs. It was decided to lower the number of existing/retained jobs divided by a lower number instead of 10. I Joint Special City Council&HRA Minutes Page 2 December 2,2013 Under question 4,"Wage level of new jobs created/retained," Councilmember Motin had concerns with requiring a certain minimum number of jobs and felt an emphasis was placed on higher paying jobs. Commissioner Toth asked if these jobs were considered temporary, part time, or full time positions.Ms.Huot gave an example of a healthcare wage in an assisted living or memory care setting would produce a full time,higher wage job than a manufacturing type of job. She noted these figures come from the existing policy,which was based upon old,figures and should be adjusted to a more current salary market. She stated t the positions created would be on permanent,full time-equivalent positions. Under question 5,"Market Value/Tax Base Generation,"Ms. Hout stated the focus should be on per unit value,not cost to construct. Councilmember Motin stated he felt the range from$95,000/unit to $135,000 was too narrow and suggested a higher price per unit would also increase die quality of the unit. Commissioner Chuba noted values increase and decrease based upon the economy,and if these values were set in stone,it would be difficult to have gotten these figures about 4 years ago but felt a$40,000 variation isn't too far out of line in this area. Councilmember Wilson asked if the building's other amenities were factored into the unit cost. Ms. Huot stated it would depend upon how the assessor applied the value of the unit along with any amenities the building offered such as a community room. She also noted the project intention would also drive the per-price unit,such as if the project were an income-based property. Question 6,"Project provides housing that is restricted to persons 55 years and older"and question 7,"Project provides that at least 30% of the total units are three-bedroom or snore" were discussed together. Ms. Huot asked the members to consider the focus of TIF and if it be towards senior housing projects or a multi-unit housing projects. Councilmember Wilson referenced the senior housing flowchart included in the staff report and asked if using the term"55 years"was proper and should be reworded to "senior housing."Ms. Huot recommended eliminating question 7 if the desire was to focus housing needs on senior housing.She then recommended changing the points for question 6 to 5 points instead of 3 points if the project provided housing that is restricted to seniors. Commissioner Toth expressed concerns with discrimination if only awarding points to senior housing. Ms.Huot stated the project could still generate enough points to qualify for financing even if the project wasn't specific for senior housing. Question 8,"Project proposes rehabilitation of existing housing,housing stock, and maximizes utilization of existing infrastructure" and question 9, "Project proposes a location near existing jobs,transportation,recreation,retail services, social services,and schools" were discussed together,and targeted areas of redevelopment. Commissioners Toth and Chuba asked who determines the criteria of the meaning of the word"near"in question 9. Ms. Huot states this was based upon comments received of the importance to position housing in areas of the city where the use a sidewalk or transportation services were already available. Commissioner Wilson felt this zeroes in on certain areas of the city that would qualify for that type of a development but felt society had decent means of transportation available to them. Mayor Dietz suggested changing die number of points in question 9 to 2 points instead of 4. Question 10 "Type of project"was discussed and the question was discussed if it matters if the property is owner-occupied or rental. It was determined to leave the points as is. Question 11 "Use"was discussed;the consensus was to eliminate question 11. PW0W E R 1 0 0 Y NAYURE Joint Special City Council&HRA Minutes Page 3 December 2,2013 Councilmember Westgaard suggested removing question 11 and suggested incorporating into question 10 or 11 more areas of use, such as mixed use or owner-occupied housing. Question 12"Likelihood that the project will result in unsubsidized,spin-off development" was discussed. Question 13 "Bonus points"was discussed.Both questions were consistent with current policy. Ms. Huot summarized that based upon the comments,the total points would adjust moderately from 45 to 38. After discussion,Mayor Dietz asked what the next steps would be. Ms.Huot stated she will make the final adjustments to the application worksheet that were discussed,make any final adjustments to the policy,and bring back to both the HRA and EDA for final review and approval. Once that is completed,the Council will have the final say in reviewing and approving the final policy and worksheet. There was some question as to the need for both HRA and EDA to review the final application and policy revisions.It was the consensus of both the Council and Authority to have the HRA and EDA review before bringing back to Council for final approval. 3. Adjournment There being no further business,Mayor Dietz adjourned the meeting at 6:40 p.m. Minutes prepared by Jennifer Johnson. JOO J.dietz"Mid Tina Allard,City Clerk i i P 0 W E N 1 9 0 Y NATURE]