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05-07-2018 HRA MINRegular Meeting of the Elk River Housing and Redevelopment Authority Held at the Elk River City Hall Monday, May 7, 2018 Members Present: Chair Larry Toth, Commissioners Denny Chuba, Michelle Eder, Louise Kuester, and Nate Ovall Members Absent: None Staff Present: Economic Development Director Amanda Othoudt, Economic Development Specialist Colleen Eddy and Sr. Administrative Assistant/Recording Secretary Jennifer Green I . 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 5:30 p.m. by Chair Toth. 2. Pledge of Allegiance The Pledge of Allegiance was recited. 3. Consider 05/07/2018 Agenda Motion by Commissioner Eder and seconded by Commissioner Chuba to approve the May 7, 2018, HRA agenda. Motion carried 5-0. 4. Consent Agenda Moved by Commissioner Ovall and seconded by Commissioner Kuester to approve the May 7, 2018, consent agenda as follows: 4.1 April 2, 2018, regular meeting minutes. 4.2 Check Register. 4.3 Balance Sheet. 4.4 Revenues and Expenditures report. Motion carried 5-0. Housing and Redevelopment Minutes May 7, 2018 S. Open Forum No one appeared for Open Forum. 6. Public Hearings There were no public hearings. 7.1 HRA Rehabilitation Program Update Ms. Eddy presented the staff report. 7.2 Director Update Page 2 Ms. Othoudt presented the staff report. She indicated there would be a closed meeting on Friday, May 11, 2018, at 10:00 a.m. to discuss the purchase of PID# 75-401-0130, also known as 430 Main Street NW, and PID# 75-401-0145, also known as 414 Main Street NW, Elk River. 7.3 Downtown TH 10 and Lowell Ave TIF Analysis Proposal Ms. Othoudt presented the staff report. She provided an overview of LHB's initial analysis of the `windshield' inspection and stated she did receive permission from ISD #728 and Elk River Meats to proceed with inspections of their buildings. She asked the EDA to review the proposal from LHB to approve proceeding with performing these inspections along with additional buildings in the expanded project area as presented in the project maps. She explained what the cost would cover. The buildings along Jackson Avenue may be necessary to include for creation of a TIF district should the school district and meat market buildings not qualify as substandard. She indicated she connected with all but one of the property owners along Jackson Avenue to explain the proposed project inspection requirement and key benefits of this type of downtown redevelopment project. Commissioner Ovall expressed concerns regarding communications to the affected property owners and allowing an inspection of their property. He asked what would happen if the inspection found structural concerns and would the property owners be responsible for making repairs to substandard buildings. Ms. Othoudt explained the property owners wouldn't be obligated to make repairs to their buildings but should they want to, TIF monies could be utilized to assist them in making those improvements. She explained possible incentive scenarios if the property owner chose to belong to the TIF district. Commissioner Ovall asked what the main methods of communications she used with the downtown businesses and asked if a contact list was available of business and property owners. Housing and Redevelopment Minutes Page 3 May 7, 2018 ----------------------------- Ms. Othoudt stated she went door to door to talk to the business owner and property owners along Jackson. She stated she's also communicated to the Downtown Elk River association of this project. Chair Toth asked if there were any audience members that would like to address the HRA. Tom Kolar, 708 Main St. NW — asked for clarification questions regarding the proposed district. He stated it was a very ambitious project. Debbie Rydberg, Executive Director of the Elk River Chamber of Commerce, asked if some of the buildings inspected don't meet the subpar standard, would they also be able to benefit from the TIF district and financing to make other improvements that are maybe not needed for your subpar standard. Ms. Othoudt replied that typically the increment is used for very specific reasons and in this case, to make improvements on the building based upon the findings of the substandard report. Steve Johnson, 309 Jackson St., has owned the building since 1965. He stated the communication from the city to gain permission from him to inspect the building came up rather quickly but he did appreciate Ms. Othoudt explaining the potential redevelopment proposal to him. He stated he would like to work with the EDA to discuss the perspective of preserving the downtown and what makes sense for everybody involved. Ms. Othoudt explained the request before them was to approve by motion the proposal by LHB, Inc. She indicated staff will formalize the authorization to inspect properties from the Jackson site with written permission. Commissioner Ovall asked if the HRA was ok approving this sunk cost, noting it's not in the budget. He indicated they're still exploring the feasibility of this redevelopment plan and doesn't feel they've received enough community feedback to proceed with incurring this expense. He wondered if they should be doing more communication with the businesses in the downtown area before proceeding with this step. Chair Toth stated he agreed with Commissioner Ovall's thoughts but felt without approving this proposal, it wouldn't provide them with the information the HRA needed to provide to potential developers. Commissioner Chuba disagreed with Commissioner Ovall and although he agreed it was an unbudgeted expense, the information obtained from the analysis would be critical in how the HRA proceeds, especially with the condition of the school district building. He noted time was of the essence. Commissioner Ovall stated he did see both sides of the issue but doesn't want it to become a preordained destiny. Housing and Redevelopment Minutes May 7, 2018 Page 4 Ms. Othoudt stated this analysis was not budgeted but the HRA can realize some of the reserves by year end. She reminded the HRA that there is nothing stopping a private developer to purchase the school district building and do this project on their own. She stated the advantage is the city could control what type of development is established and control the increment that's being generated with this project. She stated this analysis could reveal that this project this isn't viable at all and in order to proceed with this, the proposal should be approved. Commissioner Eder reiterated the communication of this project is important and not acceptable to give someone 48 hour notice. She asked to discuss the forms of communication the city will use. Commissioner Kuester stated regardless of what the HRA decides, more information needs to be provided up front to avoid misinformation. Commissioner Ovall asked if there were preliminary discussions with reserving options. Ms. Othoudt stated there was preliminary discussions with both property owners and both are receptive to the idea. Commissioner Ovall asked that an increment sheet be provided. Ms. Othoudt stated she could provide it for reference in Dropbox. Chair Ovall asked if the cost of this analysis could be reimbursed by a developer. Ms. Othoudt stated the expenses the HRA incurred could be used as a negotiation technique when the property was sold to a developer. The HRA asked questions regarding the details of the proposal by LHB, Inc. and Ms. Othoudt clarified the proposal. Commissioner Chuba moved to accept the proposal by LHB, Inc. to perform a Redevelopment Analysis as outlined in the staff report. Chair Toth asked for a second to a motion Chair Toth asked for a second to the motion. The motion died for lack of a second. Chair Toth stated this item will be tabled and requested it be placed on a future agenda to allow the commission members to ask additional questions. Commissioner Kuester asked if this assessment wasn't completed, what would be the outcome. Housing and Redevelopment Minutes May 7, 2018 Page 5 Ms. Othoudt stated if the HRA didn't move forward with the analysis, the HRA couldn't create the TIF district and a private developer could purchase the properties and develop a TIF district. Commissioner Eder asked if this analysis was the only bid received. Ms. Othoudt indicated it was as LHB is one of very few firms that provides this type of service. B. Adjournment Chair Toth adjourned the meeting at 6:20 p.m. Minutes prepareylby Jennifer Green. Tina pfd, City Clerk l ----�� r T(59/,Chair Housing & Redevelopment Authority