5.1. 5.2. HRSR 03-24-1997 r-Q *
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MEMORANDUM
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River TO: Housing and Redevelopment Authority
FROM: Paul T. Steinman, Director of Economic
Development
DATE: March 20, 1997
SUBJECT: Agenda Memo for Meeting on Monday,
March 24, 1997
5.1. King and Main Project Timing
The purpose of this discussion will be to provide an update to the HRA
Commissioners regarding the asbestos abatement, demolition, and
other aspects of the King and Main project.
After the previous HRA meeting, staff had several conversations with
B. A. Liesch Associates regarding the costs of consulting services for
• the environmental aspects of this project. Since purchase of the
properties back in June, 1996, there were only two major areas of work
which needed to be completed by Liesch Associates. These areas were:
Address Bid Cost
• Asbestos Survey 812 Main $1,600
• Coordinate Asbestos Abatement 812 Main
307/317 King $5,968
After staff's discussion with Liesch Associates regarding the HRA
concerns about these costs, Liesch agreed to the following revised bids:
Address Bid Cost
• Asbestos Survey 812 Main $1,000
• Coordination of Asbestos Abatement 812 Main
307/317 King $300-$400
At present, all environmental issues have been taken care of in the
buildings, including asbestos abatement, removal of florescent
lights/mercury switches, removal of air conditioning units, and other
items indicated in the initial report by Liesch Associates.
Veit Companies has submitted the required ten day notification of
• demolition to the Minnesota Pollution Control Agency and will be
13065 Orono Parkway • P.O. Box 490 • Elk River, MN 55330 • (612) 441-7420 • Fax: (612) 441-7425
Agenda Memo
Page Two
March 20, 1997
• proceeding with demolition during the last week of March or first week
in April. After a two week demolition process, staff will work with
Street/Park Superintendent Phil Hals to coordinate filling, compacting,
and final grading of the site in preparation for a new construction
project. The HRA costs associated with filling/compacting and grading
have yet to be determined, but will be estimated as soon as the final
demolition is complete. If Phil Hals is able to locate excess fill, and
city crews are able to complete the hauling, the cost to the HRA will be
greatly reduced. If this coordination is not possible, the HRA will have
to contract with another firm to complete these activities. It is
possible, from early estimates, that it may cost up to $4,000 to have
the filling/compacting and grading completed by an outside contractor.
Staff will provide more information to the HRA regarding this issue as
soon as possible.
With regard to timing with developer Dennis Chuba, things are
moving relatively slowly. Staff is working with Chuba to identify
possible tenants for this building, and until such a tenant is committed
to the project, he has indicated he is not able to move forward with
purchase of the property and construction. Even if the HRA were to
agree to wait to receive its $225,000, Chuba has indicated he would
• still need to have committed at least one tenant to the project in order
to obtain the necessary bank financing. Staff and Chuba have met
with several potential tenants and have received a moderate amount of
interest in this project. Staff has invited Chuba to join the HRA at this
meeting to address further questions on this issue.
5.2. Strategic Planning Meeting with City Council
A joint meeting has been scheduled for a presentation of the final
Economic Development Strategic Plan on Monday, April 21, 5 to 6
p.m., at City Hall. Other groups invited to this meeting will include
the Chamber Board of Directors, the Economic Development
Authority, City Council, Planning Commission, and the general public.
The purpose of the meeting will be to present the final Strategic Plan
for Economic Development in a worksession setting for discussion
among all the affected groups.
It is anticipated that the City Council will formally adopt the Strategic
Plan at a meeting in early May.
\\elkriver\sys\shrdoc\eda\hra\agdamemo.doc
•
ELK RIVER HOUSING AND REDEVELOPMENT AUTHORITY
• MEMORANDUM
TO: Housing and Redevelopment Authority
FROM: Paul T. Steinman, Director of Economic
Development
DATE: March 24, 1997
SUBJECT: King and Main Finances
What follows is a summary of King and Main financing:
Purchase price $410,000
Settlement Charges $ 1,157
Prorated Taxes $ 325
Second half 1996 taxes $ 5,935
Legal $ 1,284
• Environmental Audit $ 5,736
Printing &Publishing $ 31
Survey $ 1,200
Total Expenditures to Date $425,668
Expenses yet to be incurred on King and Main:
Environmental Consultants $ 1,230
Asbestos Abatement $ 16,315
Demolition $ 21,639
Filling/Compacting/Grading $ 4,000
Total Expenditures Pending $ 43,184
Staff does not have an accurate estimate of the legal fees associated with this
project in the months of January and February, but these fees should not be
more than $1,000 with review of the Development Agreement and final
issues regarding creation of Tax Increment Financing District No. 16.
As you can see from the enclosed Statement of Financial Activity, the HRA
presently has a cash balance of$63,995. It is anticipated this cash balance
would be the source of funds to pay the pending costs of$43,184.
• \\elkriver\sys\shrdoc\eda\hra\kmfinanc.doc
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