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09-20-1994 HR MIN MEETING OF THE ELK RIVER HOUSING AND REDEVELOPMENT AUTHORITY HELD AT THE ELK RIVER CITY HALL TUESDAY,SEPTEMBER 20, 1994 Members Present: Chair Schuldt, Commissioners Duitsman, Hinkle, Kropuenske, and Toth Members Absent: None Staff Present: Bill Rubin, Executive Director 1. Call Meeting To Order Pursuant to due call and notice thereof, the meeting of the Elk River Housing and Redevelopment Authority was called to order at 7:00 p.m. by Chair Schuldt. 2. Consider September 20, 1994 HRA Agenda Bill Rubin requested that item 9.1. be added to the agenda - Guardian Angels Request for Reclassification of one of its properties - Update • COMMISSIONER KROPUENSKE MOVED TO APPROVE THE SEPTEMBER 20, 1994 HRA AGENDA AS AMENDED. COMMISSIONER HINKLE SECONDED THE MOTION. THE MOTION CARRIED 5-0. 3. Consider August 11, 1994 HRA Minutes Bill Rubin provided clarification on several items in the August 11, 1994 HRA minutes. COMMISSIONER HINKLE MOVED APPROVAL OF THE AUGUST 11, 1994 HRA MINUTES. COMMISSIONER TOTH SECONDED THE MOTION. THE MOTION CARRIED 5-0. 4. Open Mike No one appeared for this item. 5. Consider Proposals for the Redevelopment of the Northwest Quadrant of Main Street and King Avenue N.W. Bill Rubin explained that the RFP was an attempt to solicit interest for the redevelopment of 3 parcels located at Main Street and King Avenue. He noted that deadline for submitting proposals was Wednesday at 4:00 p.m., September 14, 1994. One proposal was received from Mr. Jeff Krueger for a restaurant. A fax was received from the Chuba Company, requesting an extension of two • weeks. Bill noted that he has since received a cancellation of that request. HRA Minutes Page 2 September 20, 1994 Bill Rubin then introduced Jeff Krueger, the proposed developer, and Mark • Kleckner as his agent. Mark Kleckner reviewed a proposal to remodel the former Elk River Clinic site at 307 King Avenue, for family restaurant. He identified the clinic site as Parcel 1, the Kuehn-Sommers property as Parcel 2, and the former Sherburne County Abstract property as Parcel 3. Mr. Kleckner stated that the restaurant would have a seating capacity of 80-100, which would require 20-25 off-street parking spaces. He noted that there is no room on the parcel to accommodate this number of parking spaces. This is due to the placement of the building on the parcel, and the fact that there is an easement on the north boundary. This 15 foot easement is for access to the former Sherburne County Abstract building. Mark Kleckner stated that Mr. Krueger's proposal would include utilizing Parcel 3 for parking. He noted that the property would accommodate at least 31 or more parking spaces, with a double access and one way out on Main Street. Mark Kleckner also explained the Figure 3 option that utilizes Parcel 2 (former Sherburne County Abstract property) and the northern 54 feet of Parcel 1 (Elk River Clinic site), for a parking lot. This option would provide approximately 30 parking spaces. Parcel 3 (Kuehn-Sommers property) would be left relatively intact, and could be marketed by the HRA in the future. He stated that he felt that Parcel 3 would be a very marketable site, sitting between Dr. Jarmoluk's building and a newly renovated restaurant. Bill Rubin questioned the 13,200 square foot size for Parcel 3. Mr. Kleckner stated that the Figure 3 proposal would require 10 feet to be taken from the 14,400 square foot Parcel 3 to meet parking needs. This would leave Parcel 3 120 feet along Main Street and 110 feet deep, or, 13,200 square feet. Commissioner Kropuenske stated that he felt Figure 3 would be the best use of the property, since the Sherburne County Abstract property would become isolated as shown by Figure 2, except for the 15 foot easement. Commissioner Hinkle agreed that Figure 3 is a better use for the property. Mark Kleckner stated the Elk River Clinic site is listed at $200,000, the Kuehn- Sommers property at $125,000, and the former Sherburne County Abstract building is listed at $125,000. Mr. Kleckner stated that in their original proposal (Figure 2), Mr. Krueger requests that the City acquire Parcel 1 and he would purchase it for $175,000. Mr. Krueger further requests that the City acquire the Kuehn-Sommers property to be used for a municipal parking lot, with spaces designated to meet the off-street parking requirement for the restaurant. Mr. Kleckner agreed that Figure 3, utilizing the Sherburne County Abstract site, may be the best option. Mr. Kleckner explained that renovation costs are estimated between $75,000- 1111 $90,000, depending upon how much tear-out would be done by the buyer. Renovation would include gutting the inside of the building, creating two dining HRA Minutes Page 3 September 20, 1994 1110 _ areas, kitchen setup, renovating and upgrading the air conditioning, electrical, plumbing, face lift for the front exterior, changes to the entrances, handicap access, bathrooms, etc. Bill Rubin summarized that the HRA's out-of-pocket expenses would be acquisition, demolition of one of the sites, rough site preparation, compaction, and parking area improvements. Chair Schuldt questioned whether or not the number of parking spaces proposed was sufficient for 80-100 seating capacity. Mark Kleckner stated that he was informed by the City Planner, Steve Ach, that 1 parking space was required for 4 restaurant seats. Therefore, the ordinance would require 20-25 parking spaces for seating of 80-100. Bill Rubin outlined options before the HRA: 1. Participate in the restaurant proposal - out of pocket expenditures would be required to acquire, demolish and prepare the site, and install a parking lot. 2. Acquire the second parcel for marketing at some point in the future for redevelopment. 3. Look at assembling all three parcels for redevelopment and hold • until the time is right for redevelopment 4. Do nothing Chair Schuldt questioned how Parcel 3 (Kuehn-Sommers property) would be affected if 10 feet were taken from the Sherburne County Abstract property to meet the parking requirements. Bill Rubin stated that the Cl zoning has no minimum lot requirement. He explained that possibly some type of internal lot split could be done to shift the 10 foot strip to Parcel 2. He noted that it may be necessary to obtain an appraisal to determine the value. Mark Kleckner stated there are no setback requirements in the Cl zone. He explained that on a 13,200 square foot parcel, 10 feet of green space could be used from the front and sides of the lot, 20 feet from the back, and still have room for a 9,000 square foot building (foundation size, single story). Mr. Kleckner noted that parking requirements need to be considered for Parcel 3 as well. He explained that it would be difficult to estimate a value for the 10 foot strip, given the wide range of values for commercial property in the City. However, he felt that if the HRA did not acquire Parcel 3, it is unlikely another property owner would be willing to part with the 10 feet. Commissioner Kropuenske questioned if the City would own the parking area site or the developer. Bill Rubin suggested that the City may not wish to be the long term holder of the parking lot. • Bill Rubin explained that the HRA is looking at acquiring a piece of property for approximately$125,000, demolition costs of$5,0000-10,000, and site preparation. HRA Minutes Page 4 September 20, 1994 Commissioner Kropuenske stated that he was not in favor of the HRA providing a parking lot for a business. He questioned whether or not Mr. Krueger would be better off starting with a vacant lot and building a new building. Mr. Kleckner stated that in estimating costs for land acquisition and construction, Mr. Krueger costs would be approximately$110,000 less by renovating the old clinic building. Discussion followed regarding the listing prices for the three parcels. Further discussion followed regarding the requirement for off-street parking. Bill Rubin stated that perhaps an agreement could be drafted which would designate some parking spaces for the restaurant and some for municipal parking. Bill explained that provisions for parking is a integral part of this proposal. Mr. Kleckner that the parking has been a major obstacle for all prospective buyers for this property. Commissioner Kropuenske stated that he saw no difference between this property and the Cuba property, in that the developer was required to provide adequate off-street parking. Discussion followed regarding the value of the buildings on Parcel 2 and Parcel 3. Commissioner Toth suggested that it may be the listing prices for the properties in question are inflated. Commissioner Kropuenske stated that he was in favor of using HRA funds to clear land for redevelopment, but questioned using funds for parking improvements. He stated that he felt they may be setting a dangerous precedent in doing so. Mr. Kleckner stated that the HRA should consider the potential for parking problems in this whole area if any one of the properties on this block were to be developed. Commissioner Kropuenske stated he did not feel the proposed parking lot would solve parking problems for any of the other sites. Mr. Kleckner proposed that at some point in the future, King Avenue be vacated to create parking so serve some of these properties. Commissioner Hinkle stated that he felt that costs need to be determined and they would need more information before a decision can be made. Bill Rubin explained that it would be ideal for the HRA to spend the funds to clear the land, have a developer come in and develop all three parcels. But, he stated, the interest is not obviously not there, since this is the only proposal that has been received. Commissioner Duitsman indicated that the City would not likely consider vacating King Avenue on the basis of just this one proposal, but if the need is there when other properties such as the county administration building are utilized, it could be considered. Bill Rubin stated that issue before the HRA is either require a developer to acquire enough property to provide off-street parking, or for the HRA to accept • part of the responsibility. HRA Minutes Page 5 September 20, 1994 • _ ___ -- Commissioner Kropuenske reiterated his concern for setting a precedent in providing parking for other downtown development sites. Bill Rubin suggested that the HRA could obtain an appraisal which would provide a land and building value for each of the three parcels, as well as a value for the land if it were vacant. Bill stated that John Benson of St. Cloud has done work for the City/EDA in the past and provided a quote of $2,200 per appraisal. He added that that Mr. Benson could assure a delivery date of mid- November if authorization to proceed was granted in the next week or so. Chair Schuldt stated that in the past, a study was done regarding angle parking on both sides of King Avenue, but he was not aware of the outcome. Commissioner Hinkle questioned the time frame the developer had in mind. Mark Kleckner stated that Mr. Krueger would like to occupy the restaurant in late summer, 1995. Commissioner Kropuenske stated that he is in favor of a family restaurant coming to Elk River, but that he has some reservations for providing parking. COMMISSIONER HINKLE MOVED THAT THE HRA AUTHORIZE AN APPRAISAL OF THE THREE PROPERTIES IN QUESTION, TO BE DONE BY PANGER BENSON AT A COST NOT TO EXCEED $6,600. COMMISSIONER KROPUENSKE SECONDED THE MOTION. THE MOTION CARRIED 5-0. 411 COMMISSIONER KROPUENSKE MOVED THAT THE PROPOSAL BY MR. JIM KRUEGER BE TAKEN UNDER ADVISEMENT, TO BE ADDRESSED AT A FUTURE DATE. COMMISSIONER HINKLE SECONDED THE MOTION. THE MOTION CARRIED 5-0. 6. Consider the Formation of a CBD Riverfront Corridor Committee Bill Rubin reviewed the proposal for CBD riverfront corridor or pathway in downtown Elk River. The HRA allocated $17,000 towards exploring this concept and a match of funds has been requested from the Park and Recreation Commission. Bill explained that he is proposing the formation of a CBD Riverfront Corridor Committee as follows: HRA-two members Park & Recreation -two members Downtown property owner-one member Downtown Development Corporation -two members Chamber of Commerce- one member At-large representative- one member Total Nine members Bill stated that in addition, staff liaisons to the committee could include the City Planner,Street/Park Superintendent, and Economic Development Coordinator. Bill Rubin offered the following schedule of events: 1111 -September/October 1994: Select and organize Riverfront Corridor Committee HRA Minutes Page 6 September 20, 1994 -October/November 1994: Define committee mission; define 4111 scope of work -November, 1994: Solicit proposals from landscape design/urban planning firms -December, 1994: Select design firm -January/March, 1995: Design corridor and develop plans and specifications and cost estimates -April, 1995: Bid project -May/June, 1995: Construct initial phase or phases of riverfront corridor Chair Schuldt asked what is meant by a riverfront corridor. Commissioner Duitsman stated that it is proposed to have a pathway along the river, from the bridge downtown down to Dare's. Commissioner Kropuenske explained that the concept was discussed as part of the plans for the former hardware store site. He added that the gazebo site behind First National Bank is well used by the community for picnicking, wedding photos, and as a rest area for families biking on the weekends. Bill Rubin suggested that someday the pathway could be connected to Babcock Park. Chair Schuldt added that when this idea was previously discussed, land acquisition from private property owners was considered as an obstacle. He stated that it was even discussed to have a riverfront trail run all the way down to the Orono Dam. Bill suggested that an easement could be obtained from private property owners. Commissioner Kropuenske stated that he would not foresee a problem obtaining easements from private land owners, since the pathway would improve their property. Bill Rubin stated that it was his understanding that the former riverfront pathway concept failed because the developers of the former hardware site were expected to bear most of the costs associated with the project. Commissioner Kropuenske stated that are several sketches and designs still in existence. He stated that he remembers a plan was done by the Governor's design team. He stated that he would be willing to serve on the Committee. COMMISSIONER DUITSMAN MOVED THAT THE HRA FORM A CBD RIVERFRONT CORRIDOR COMMITTEE COMPRISED OF 9 MEMBERS AS RECOMMENDED BY THE HRA EXECUTIVE DIRECTOR, BILL RUBIN. COMMISSIONER KROPUENSKI SECONDED THE MOTION. Commissioners Kropuenske and Toth volunteered to serve on the Committee. Bill Rubin indicated that the Park and Recreation Commission expressed their support for this project and were willing to have 2 members serve on the Riverfront Corridor Committee, possibly on a rotational basis. Bill felt if the Commission found a project to be acceptable, they would be willing to make a • recommendation for the expenditure of funds. HRA Minutes Page 7 September 20, 1994 • Bill Rubin stated that the HRA previously authorized the expenditure of$20,000 to be used as a match for the rip-rap grant. Commissioner Duitsman noted that Phil Hals and a representative from MSA were checking out the riverbank to be sure that $40,000 was adequate to the necessary work. THE MOTION CARRIED 5-0. COMMISSIONER HINKLE MOVED TO APPOINT COMMISSIONER LARRY TOTH AND COMMISSIONER DUANE KROPUENSKE TO SERVE ON THE CBD RIVERFRONT CORRIDOR COMMITTEE. COMMISSIONER DUITSMAN SECONDED THE MOTION. THE MOTION CARRIED 5-0. Commissioner Duitsman requested that the HRA be advised of meeting dates and times that the committee meets. Commissioner Kropuenske suggested that the committee be formed with representation from the committees-of-record, and then determine who will be the downtown business owner and member at large representatives. 7. Consider 1994 Transfer to the City's General Fund COMMISSIONER DUITSMAN MOVED TO APPROVE THE TRANSFER OF $500 FROM THE HRA BUDGET TO THE CITY'S GENERAL FUND. COMMISSIONER TOTH SECONDED THE MOTION. THE MOTION CARRIED 4-0. COMMISSIONER KROPUENSKE WAS ABSENT FOR THE VOTE. • 8. Consider the HRA Statement of Expenses COMMISSIONER HINKLE MOVED TO APPROVE PAYMENT TO THE CITY OF ELK RIVER FOR HRA EXPENSES, IN THE AMOUNT OF $3,694.37 (SAID AMMOUNT INCLUDES THE $500.00 TRANSFER TO THE GENERAL FUND). COMMISSIONER TOTH SECONDED THE MOTION. THE MOTION CARRIED 5-0. 9.0. Conflict of Interest Ordinance Amendment It was the consensus of the HRA to recommend that the City Council adopt the ordinance amendment that follows State law. 9.1. Guardian Angels Request for Reclassification Issue Bill Rubin explained the history of Guardian Angels request for the City of Elk River to monitor the income level at Evans Park in order for the County to reclassify the property to 4C. He stated that Guardian Angels' attorney is drafting an agreement, which will be presented to the City's attorney. Bill noted that Kathleen Heaney, Assistant County Attorney, has requested a copy of the agreement when it becomes available. The matter is expected to be brought before the HRA again in approximately 30 days. • HRA Minutes Page 8 September 20, 1994 Y~ Adiournment �_____ 10. • There being no further business, COMMISSIONER HINKLE MOVED TO ADJOURN THE MEETING. COMMISSIONER TOTH SECONDED THE MOTION. THE MOTION CARRIED 5-0. The meeting of the Elk River Housing and Redevelopment Authority adjourned at 8:36 p.m. Respectfully submitted, Debbie Kleckner Recording Secretary 11111 •