HRSR MEMORANDUM0 5-23-1996 ELK RIVER HOUSING AND REDEVELOPMENT AUTHORITY
MEMORANDUM
TO: Housing & Redevelopment Authority
FROM: Pat Klaers, Executive Director
DATE: May 23, 1996
SUBJECT: Agenda Memo
4. Mississippi Riverfront Pathway Project
Attached is the newspaper article from one year ago where this project,
as originally conceived, was outlined and reviewed. As everyone
knows, the ISTEA grant application was not approved and the city is
now left with either scaling down or revising the project and/or
phasing in the project over time. Even if this project does not happen
immediately, the city should make an effort to preserve the
opportunity to do a riverfront pathway project at some time in the
4111 future.
Michael Schroeder and Paul Paige from HKgi will be present at this
meeting to provide everyone with some revised concepts for the project.
5. King and Main Street Redevelopment Site
At the last HRA meeting I was directed to sign the purchase
agreement for the properties associated with this redevelopment
project. This direction was given after the terms and conditions of the
purchase agreement, the financial ramification of the district, and a
commitment letter from the developer,Mr. Denny Chuba, were
reviewed.
At this time, I have already signed the purchase agreement for this
project. However, if there are environmental concerns, the city can
still get out of this agreement as provided in the addendum. The
tentative closing date is June 21, 1996. I will be out of town on this
date and the HRA should appoint Lori Johnson as the acting executive
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P.O. Box 490 • 13065 Orono Parkway • Elk River, MN 55330-1743 • (612) 441-7420 • Fax: (612) 441-7425
Equal Opportunity Housing and Equal Opportunity Employment
director to sign on my behalf until I return....The county has reviewed
the city attorney's memo on the possibility of achieving zero net tax
capacity and will be responding in writing. With some questions of a
minor nature being raised, the county assessing department has
verbally indicated that they generally agree with the city attorney's
memo....A revised letter of commitment from the developer has been
worked on by the city attorney and Mr. Chuba (see attachment)....The
Utilities Commission is meeting on 5/23 at 5 p.m. to review the
environmental analysis and overall condition of their building....The
building official has toured the three structures, videotaped the
structures, and provided a memo describing the general conditions of
the structures which indicates that, in his professional opinion, the
structures will meet the definition of a redevelopment district....A
phase one environmental audit by city environmental consultant, B.A.
Leisch and Associates, has been authorized and is expected to be
completed prior to the closing.
The above paragraph should update everyone as to where we are at
with,this project. The one new issue that has surfaced is the lack of a
redevelopment plan for this project and how the timing of adopting
such a plan conflicts with the need to purchase the property before
July. In this regard, state law provides for early acquisition of
property prior to the approval of the redevelopment plan. However,
this early acquisition provision still requires a public hearing to be
held by the City Council and for the City Council to approve by
resolution the proposed acquisition. This public hearing will need to
be held, and a resolution will need to be considered and approved at
the June 17, 1996, City Council meeting. If everything goes according
to plan, the HRA will then have a redevelopment plan prepared for
this project, have it reviewed by the Planning Commission, and hold a
public hearing on the proposal. A redevelopment plan for this project
in Elk River should be relatively simple and specific. Some
redevelopment plans in larger communities or Minneapolis/St. Paul
can include a very large area and be very general in its discussion of
activities.
Everything seems to be moving forward in a timely manner. It would
be appropriate for the HRA to recommend to the City Council approval
of the early acquisition of this property. It would also be appropriate
for the HRA to appoint Lori Johnson to sign on my behalf as executive
director when I am unavailable. At this time there does not appear to
be any other action items necessary for the HRA that are associated
with this project.
One final comment regarding this project relates to our 15 percent TIF
subsidy policy. If the finished market value of the project is $1 million,
the city will far exceed the TIF 15 percent policy. This is due to the
unique nature of the project and the fact that this 15 percent policy
was generally intended to apply to economic development districts and
not redevelopment districts. This issue and the local financial penalty
will be discussed in detail when the TIF district is established.
s:hra/523agmm