3.0. EDSR 12-21-1998 ELK RIVER ECONOMIC DEVELOPMENT AUTHORITY
IP
MEMORANDUM
TO: Economic Development Authority
FROM: Paul Steinman,Director of Economic
1! Development
DATE: December 21, 1998
SUBJECT: Consider Resolution 98- Authorizing
Commencement of Eminent Domain
Proceedings
Issue
At its November worksession, the EDA discussed the possibility of using its
power of eminent domain to facilitate the condemnation of two specific
0 properties which lie within Tax Increment Financing Redevelopment District
No.19. At that meeting's discussion it appeared the EDA would consider
proceeding with condemnation to facilitate the overall commercial/industrial
project for TIF District No. 19.
Staff has had several discussions regarding this issue with Associated
Developers and, as indicated, it would not recommend that the EDA proceed
with condemnation until, at a minimum, an outside date had been
established for Associated Developers to complete its purchase of the Earl
Hohlen property. As per the attached letter from Associated Developers, an
outside date of January 15, 1999, has been established for a closing on the
purchase of the Earl Hohlen property by Associated Developers.
Tony Gleekel, representing Associated Developers, will be present at the
meeting to address issues raised by the EDA regarding this proceeding. City
Attorney Peter Beck has drafted the attached resolutions and will also be
available at the EDA meeting to address any issues regarding the
recommended action.
The two properties on which Associated Developers is requesting the EDA to
use its powers of eminent domain include the following:
(110 • James Mevissen- 2.04 acres estimated market value $110,900
13065 Orono Parkway • P. 0. Box 490 •Elk River, MN 55330-1743 • (612) 441-7420• Fax (612) 441-7425
Equal Opportunity Housing and Equal Opportunity Employment
• Delton and Joan Warden- 4.33 acres - estimated market value -
• $97,000
Associated Developers will be paying all costs associated with this
proceeding including attorney fees, court fees, purchase of properties,
relocation, etc.
These two properties lie in the northeast corner of Tax Increment
Financing District No. 19. A map is attached to this memo for
reference by the EDA.
Recommendation
Staff recommends approval of attached Resolution 98- Regarding
the Economic Development Authority's Use of Condemnation to
Acquire Certain Real Properties Located Within Tax Increment
Financing District No. 19.
RESOLUTION NO.
ECONOMIC DEVELOPMENT AUTHORITY
CITY OF ELK RIVER
COUNTY OF SHERBURNE
STATE OF MINNESOTA
A RESOLUTION OF THE ECONOMIC DEVELOPMENT AUTHORITY FOR THE
CITY OF ELK RIVER AUTHORIZING THE ACQUISITION OF CERTAIN REAL
PROPERTY LOCATED IN AND RELATED TO TAX INCREMENT FINANCING
DISTRICT NO. 19 IN THE CITY OF ELK RIVER BY NEGOTIATION OR
CONDEMNATION, THE DEMOLITION OF ALL STRUCTURES CURRENTLY
LOCATED THEREON,AND THE RELOCATION OF ALL AFFECTED PROPERTY
OWNERS AND TENANTS
WHEREAS, the Economic Development Authority for the City of Elk River, Sherburne
County, Minnesota, ("EDA"), is a public body corporate and politic duly organized and existing
• in accordance with the provisions of the Minnesota Economic Development Authorities Act,
Minn. Stat. §§469.090 through 469.1081, as amended, and the provisions of its Enabling
Resolution, Resolution No. 87-63 of the City Council of the City of Elk River, as amended;
WHEREAS, the EDA has the power and authority to acquire real property by
negotiation and condemnation pursuant to and in accordance with the provisions of Minn. Stat.
§ 469.101, Minn. Stat. §469.012, as incorporated by Mnn. Stat. §469.091, and Minn. Stat.
§469.126, as incorporated by Minn. Stat. § 469.091;
WHEREAS, the City of Elk River adopted the Elk River 1995 Comprehensive Plan
("Comprehensive Plan")on December 18, 1995 and the East Elk River Urban Services Area
Planning Study("Planning Study") in May, 1997;
•
R.m H 979$49.1
• WHEREAS, the Comprehensive Plan and the Planning Study anticipate and provide for
the extension of city utilities to the East Elk River Area and the development and redevelopment
of underutilized properties within the East Elk River Area;
WHEREAS, the City of Elk River, by previous action, has designated Municipal
Development District No. 1 ("Development District"), which Development District is
coterminous with the city limits of the City of Elk River, and has adopted a development program
for the Development District("Development Program");
WHEREAS, in accordance with the Comprehensive Plan, the Planning Study and the
Development Program the City of Elk River has deemed it advisable to encourage development
and redevelopment within the Development District and the East Elk River Area in an effort to
increase the tax base of the City of Elk River, provide employment opportunities within the City
of Elk River and otherwise benefit the health, safety, morals and welfare of the residents of the
City of Elk River, in accordance with the public purpose provisions of applicable state and local
laws;
WHEREAS, the EDA has previously designated,pursuant to the Development Program,
a tax increment financing district known as Tax Increment Financing District No. 19 ("TIF
District 19") consisting of 156.37 acres of land located within the Development District;
WHEREAS, TIF District 19 qualifies as and is a redevelopment tax increment financing
district established pursuant to the provisions of the Minnesota Tax Increment Financing Act,
Minn. Stat. § 469.174, et. seq.
•
1Rcatoll 979349.1 2
• WHEREAS, in accordance with the Tax Increment Financing Plan for TIF District 19,
the EDA is facilitating the redevelopment of certain real property located within TIF District 19
into a new commercial and industrial development.
WHEREAS, the property to be redeveloped within TIF District 19 has been rezoned to
accommodate the proposed redevelopment, related land use approvals are scheduled to be acted
on within the next thirty(30) days, and the EDA is completing negotiations with the developers
on a redevelopment agreement which will provide for redevelopment of over 100 acres of real
property located within TIP District 19;
WHEREAS,the EDA believes that redevelopment of real property located within TIF
District 19 and in the Development District is in the best interests of the City of Elk River and will
expand the tax base of the City,will expand the job opportunities available to the residents of the
City and its surrounding area, and will otherwise benefit the health, safety, morals, and welfare of
the residents of the City, and will satisfy a necessary public purpose in accordance with applicable
state and local laws;
WHEREAS, the proposed redevelopment, in the opinion of the City, cannot reasonably
be expected to occur solely through private investment within the reasonably foreseeable future,
and the increased market value of the property to be redeveloped that could reasonably be
expected to occur without the use of tax increment would be less than the increase in market
value estimated to result from the proposed redevelopment after subtracting the present value of
the projected tax increments for the maximum duration of the TIF District;
WHEREAS, the proposed redevelopment cannot occur without acquisition of the two
• properties identified in Exhibits A and B to this resolution;
'teH 979349.1 3
40 WHEREAS, in addition to redevelopment within TIF District 19, the EDA intends to use
tax increment generated by TIF No. 19 to assist in the acquisition of land and development of an
industrial park/business park immediately south of and adjacent to TIF District 19, which
industriaVbusiness park cannot be established without acquisition of the property identified on
Exhibit C to this resolution.
NOW THEREFORE,be it resolved by the Economic Development Authority in and for
the City of Elk River as follows:
1. The acquisition of the real property identified in Exhibits A,B, and C to this
resolution is necessary for redevelopment of TIF District 19 and establishment of the proposed
industrial/business park south of TIF District 19, and is for a necessary public purpose in that the
acquisition of said real property will expand the tax base of the City, expand job opportunities
•
available to the residents of the City and its surrounding area, will provide for the redevelopment
of real property currently improved with substandard structures, will provide the impetus for
redevelopment within the TIF District and for additional development within the Development
District, and will otherwise benefit the health, safety, morals, and welfare of the residents of the
City of Elk River.
2. The acquisition of the real property described in Exhibits A, B, and C attached
hereto ("Real Property")is for a necessary public purpose in furtherance of the objectives of the
TIF plan for TIF District 19 and the Development Program for the Development District.
3. Because redevelopment within TIF District 19 and construction of planned
roadway and utility improvements to support this redevelopment is scheduled to begin in early
• 1999, prior to the time by which court appointed commissioners could reasonably be expected to
Rowali 979349.1 4
render their award for the taking of the Real Property described in Exhibits A, B, and C attached
hereto, the EDA determines it necessary to proceed without delay under Minn. Stat. § 117.042 to
pay the owners or into court a sum of money to secure compensation to the owners of the Real
Property, which amount shall be equal to the EDA's approved appraisal value as determined by
City staff.
4. The EDA hereby authorizes staff to take all actions necessary for the acquisition of
the Real Property, including the specific authorization to(a)obtain appraisals or minimum
damage assessments of the Real Property to be acquired;(b)make written offers to the affected
property owners and negotiate such offers to a successful conclusion; (c)acquire the Real
Property at the appraised value plus additional damages, if any, as approved by the City
Administrator; (d) in circumstances where negotiation proves to be unsuccessful, condemn parcels
or portions thereof under the procedures provided for by Minnesota Statutes.
5. Staff is further directed and authorized to take all necessary action to implement
this authorization, including obtaining appraisals of all subject property, entering into contracts,
including redevelopment contracts, and retaining outside counsel to assist in the acquisition of the
Real Property. Any actions previously taken by staff in this regard are hereby ratified and
affirmed.
6. The EDA further authorizes staff to provide for the demolition of all structures in
the TIF District following acquisition of the Real Property described on Exhibit A hereto. The
EDA staff shall provide for all relocation assistance, services, and benefits as required in
Chapter 117 of Minnesota Statutes.
•
ReeteH 979319.1 5
1
Approved by the Board of Commissioners of the Elk River Economic Development
Authority this 21'day of December, 1998.
Henry A. Duitsman, President
ATTEST:
Paul T. Steinman, Executive Director
•
Radon 979349.1 6
EXHIBIT A
JAMES MEVISSEN PROPERTY
That part of SW '4 of SW 'A described as follows:
Beginning at a point on the centerline of public road running northwesterly and
southeasterly through said SW 1/4 of SW 1/4 which point is 549.08 feet northwesterly
of the intersection of said centerline,thence southwesterly 330 feet on a line running
to a point on the south line of said SW 'A of SW 'A that is 675 feet west of the
southeast corner thereof, thence northwesterly parallel to centerline of said road and
330 feet therefrom for a distance of 300 feet, thence in a northeasterly direction a
distance of 330 feet to a point on centerline that is 300 feet northwesterly of the point
of beginning,thence southeasterly along the centerline of said road a distance of 300
feet to point of beginning. Section 35, Township 33, Range 26.
•
Bec P 580270.1
• EXHIBIT B
DELTON AND JOAN WARDEN PROPERTY
That part of SW 'A of SW 'A described follows:
Beginning at a point on the south line of said SW'A of SW 'A that is 250 feet west of
the southwest corner thereof, thence northeasterly to a point on the centerline of the
public road that is 1.88 CH northwesterly when measured along the centerline of said
road from the east line of said SW 'A of SW '/., thence northwesterly along the
centerline of said road a distance of 425 feet, thence southwesterly to a point on the
south line of said SW 'A of SW 'A that is 425 feet west of the point of beginning,
thence east along south line of said SW'A of SW'A to point of beginning. Section 35,
Township 33, Range 26.
•
•
Beak?3710270.1
• EXHIBIT C
JOSEPH P.AND YVONNE KIRKEIDE
That part of NE 1/. of SW % described follows:
Commencing at a point on the East line of SW '4, 1,580.45 feet North from the
Southeast corner, thence West at right angle to said line 295.12 feet to point of
beginning of land to be described, thence continuing West along last described line
295.12 feet,thence North at right angle 295.12 feet,thence East at right angle 295.12
feet to a point that is 295.12 feet West of said East line, thence South parallel with
East line 295.12 feet to point of beginning. Section 2, Township 32, Range 26.
•
•
BeekP$20270.1
DEC-15-98 TUE 15:46 SIEGEL, BRILL FAX NO, 612 339 6591 P. 02
LAW OFFICES
SIEGEL, BRILL, GREUPNER, DUFFY & FOSTER, RA.
1300 WASHINGTON SOUARE
JOSIAH E. BRILL.JR. IOD WASHINGTON AVENUE SOUTH JORDAN M. Lewis
JAMES R. GREUPNER MINNEAPOLIS MINNESOTA 5341.0 I BRIAN E,weirs E1iG
GERALD 5. DUFFY ' MICHELLE R.KL£GON
WOOD R, FOSTER,JR. TELEPHONE 161e)339-,131 JAMES A.YAROSH
THOMAS M.GOODMAN STEVEN WEINTRAur
JOHN S.WATSON FAC5IMILE 161c1339.6591
TROT J.SEIBERT
WM, CHRISTOPHER PENWELI
SUSAN H.vOIGT
ANTHONY J. GLEEKEL
JOEL H.JENSEN OF COUNSEL
SHERRI L. ROHLF RICHARD SIEGEL
Writcr i Vplcemail Number 3354151
December 15, 1998
Mr. Paul Steinman VIA FACSIMILE—441-7425
Economic Development Director
City of Elk River
P.O.Box 490
Elk River,MN 55330
Re: Associated Developers of the Twin Cities,Inc.—Elk River Development
. Our File No. 19,293-D-002
Dear Paul:
Pursuant to our discussions today, Associated Developers of the Twin Cities, Inc. ("Associated
Developers") hereby advises the City of Elk River and the City Economic Development Authority
that Associated Developers will close on its purchase of the Hohlen property on or before January
15, 1999.
Very truly yours,
Antho , eekel
AJG:lar
cc: Math Fischer
John MacGibbon, Esq.
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LEGEND
".4 4 T i F BOUNDARY
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P AB
TIF 19
SITE LOCATION MAP City of 1., �..
Howard R.Green Company Elk ' ive r
CONSULTING ENGINEERS