7.4. HRSR 07-06-2020 ��i
City of
Elk ' Request for Action
River
To Item Number
Housing and Redevelopment Authority 7.4
Agenda Section Meeting Date Prepared by
General BusinessJuly 6, 2020 Amanda Othoudt,EDD
Item Description Reviewed by
Main Street and Gates Redevelopment Project— Cal Portner, City Administrator
Award Demolition Contract Reviewed by
Action Requested
Authorize,by motion,the executive director to engage in a contract for the demolition of buildings located at
326 Gates Avenue NW,and 414, 420, 426 and 430 Main Street NW,in addition to two accessory structures at
406 Main and 419 3rd Ave NW with [the chosen contractor] in an amount not to exceed $ and
authorize the executive director and the chair to execute the contract in a form acceptable to the HRA attorney,
the chair and the executive director.
Authorize,by motion,the executive director to engage in a contract with Techtron Engineering, Inc.
Environmental Solutions for pre-demolition asbestos testing of buildings located at 414, 430, 420 Main Street
NW, and 326 Gates Ave NW in an amount not to exceed $2,600 and authorize the executive director and the
chair to execute the contract in a form acceptable to the HRA attorney,the chair and the executive director.
Background/Discussion
At their October 7, 2019, meeting,the HRA and the City Council adopted resolutions designating 326 Gates
Ave NW, 414, 426 and 430 Main Street NW as structurally substandard prior to demolition or removed to
create a redevelopment or renewal and renovation Tax Increment Financing (TIF) district based on the TIF
Analysis Findings dated September 6, 2019, completed by LHB, Inc.
The HRA engaged LHB,Inc. to conduct an inspection on two additional properties acquired by the HRA to
determine if the proposed district meets the requirements. On June 1, 2020,LHB found 406 Main St NW to be
structurally substandard under the definition set forth in the Minnesota Statutes, Sections 469.174 to 469.1794.
On June 1, 2020, the HRA authorized staff to negotiate a contract with a demolition contractor and bring it to
the commission for final action. Staff received demo estimates from three companies to demo for five of the
seven properties. Otting House Movers,LLC is seeking to purchase and remove the remaining two properties.
Pre-demolition asbestos testing must be completed prior to demolition. Techtron Engineering has provided an
estimate to identify asbestos containing materials at each site. The HRA will realize a cost savings by having
asbestos inspections done separate from the demolition contract.
Financial Impact
The estimated project budget is $1,300,000 which includes acquisition,insurance,maintenance, appraisal, and
demolition costs. The HRA will utilize reserve funds for the purchase and demolition of the properties.
The Elk River Vision
A Y�elcoming community nvith revolutionary and spirited resourcefulness, exceptional p D W E H E D D Y
service, and community engagement that encourages and inspires prosperity ,g /` UR
Updated proposals were received from Steinbrecher Companies, Inc.,Veit Companies and Turf Enterprise,
Inc. The pricing includes water/sewer shut off at the street and traffic control. Pricing does not reflect the
abatement and removal of hazardous materials which must be completed separately.
Attachments
■ Demolition Proposals (to be presented at the meeting)
■ Techtron Engineering,Inc. estimate
■ Resolution 19-48
City of
Elk _
River City of Elk River
City Council
Resolution 19- 46
A Resolution of the City Council of the City of Elk River Finding Parcels Are
Occupied by Structurally Substandard Buildings
WHEREAS, it has been proposed that the City of Elk River, Minnesota, (the "City") or
the Housing and Redevelopment Authority in and for the City of Elk River, Minnesota (the
HRA"), create one or more tax increment financing districts within the City to be
designated as redevelopment districts or renewal and renovation districts as defined in
Minnesota Statutes, Section 469.174, Subd. 10 and Subd. 10a (the "TIF District"); and
WHEREAS, in order to create this type of TIF District, the City and the HRA must make
a determination that before the demolition or removal of any substandard building, certain
conditions existed; and
WHEREAS, under Minnesota Statutes, Section 469.174, subd. 10(d), the City and the
HRA are authorized to deem parcels as occupied by structurally substandard buildings
despite prior demolition or removal of the buildings, subject to certain terms and conditions
as described in this resolution; and
WHEREAS, in order to deem a parcel as being occupied by a structurally substandard
building, the City or the HRA must first pass a resolution before the demolition or removal
that the parcel was occupied by one or more structurally substandard buildings and that after
demolition and clearance the City or the HRA intended to include the parcel within the
proposed tax increment financing district; and
WHEREAS, there exists in the City on each of the parcels described in Exhibit A attached
hereto (collectively, the "Parcels") one structurally substandard building to be demolished or
removed (the "Substandard Building Condition"); and
WHEREAS, a parcel is deemed to be occupied by a structurally substandard building if
the Substandard Building Condition is met within three years of the filing of the request for
certification of the parcel as part of the tax increment financing district with the county
auditor, and if certain other conditions are met; and
WHEREAS, the HRA intends to cause demolition of buildings located on the Parcels, and
the City or the HRA may in the future include the Parcels in a redevelopment or renewal and
renovation tax increment financing district; and
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Elk
River, Minnesota, as follows: Click here to enter text.
PONERE6 er
NATURE
1. The Council has received from LHB, Inc. the "TIF Analysis Findings for 326
Gates Ave NW, 414, 426 and 430 Main Street NW", dated September 6, 2019 (the
Inspection Report"), finding that, based on an inspection of the buildings located on the
Parcels, such buildings were determined to be substandard under the definition set forth in
the Minnesota Statutes, Sections 469.174 to 469.1794, as amended (the "TIF Act"). Based
on the Inspection Report and other information available to the Council, the Council finds
that the buildings on the Parcels are structurally substandard to a degree requiring substantial
renovation or clearance and at least 15% of the area of each of the Parcels identified on
Exhibit A attached hereto are occupied within the meaning of Minnesota Statutes, Section
469.174, Subd. 10.
2. After the date of approval of this resolution, the buildings on the Parcels may
be demolished or removed by the City or the HRA, or such demolition or removal may be
financed by the City and the HRA, or may be undertaken by a developer under a
development agreement with the City or the HRA.
3. The City and the HRA intend to include the Parcels in a TIF District, and to
file the request for certification of such district with the Sherburne County auditor within 3
years after the date of demolition of the buildings on the Parcels.
4. ' Upon filing the request for certification of a new tax increment financing
district, the City or the HRA will notify the Sherburne County auditor that the original tax
capacity of the Parcel must be adjusted to reflect the greater of (a) the current net tax
capacity of the parcel, or (b) the estimated market value of the Parcel for the year in which
the building was demolished or removed, but applying class rates for the current year, all in
accordance with Minnesota Statutes, Section 469.174, subd. 10(d).
5. City and HRA staff and consultants are authorized to take any actions
necessary to carry out the intent of this resolution.
6. The City authorizes expenditure of available tax increments and other
available funds to pay the costs of such demolition or removal, in such amounts as
determined necessary for such purpose by the City's Finance Director.
7. On December 1, 2017, the Council and the Board of Commissioners of the
HRA adopted interfund loan resolutions (collectively, the "Interfund Loan Resolution")
authorizing the payment of certain costs by the HRA and the City, including the costs of
demolition of the buildings on the Parcels, in an amount not to exceed the greater of
1,100,000 or the adopted and, if applicable, amended Tax Increment Financing Plan budget
for the TIF District pursuant to Minnesota Statutes, Section 469.178, Subd. 7. Payments of
principal of and interest on the Interfund Loan (as defined in the Interfund Loan
Resolution) shall be paid from Available Tax increment (as defined in the Interfund Loan
Resolution). This resolution supplements, but does not supercede, the Interfund Loan
Resolutions.
a
ERER RT
AtURE
Passed and adopted this itn day ofOctooer 2019.
ATTEST:
a
Tina Allard, City Clerk
U
J J. ietz, Nwor
P 0 v E R E 0 B I
NAru
EXHIBIT A
PARCEL IDENTIFICATION NUMBERS
75-401-0105
75-401-0130
75-401-0135
75-401-0145
Ip 0 v f A I I it
NATURE
July 01, 2020
Amanda M. Othoudt, EDFP
City of Elk River
Re: Pre-demolition asbestos testing
Various Properties in Elk River, MN
Dear Ms. Othoudt,
Following is the quotation you requested to perform pre-demolition asbestos inspections at
414 Main, 430 Main, 420 Main, and 326 Gates in Elk River, Minnesota.
Techtron Engineering shall:
• Identify asbestos containing materials at each site,
• Perform destructive entry to identify “hidden” asbestos,
• Provide locations and quantities of identified asbestos, and
• Provide recommendations to prepare the sites for demolition.
Work shall be performed for a lump sum for of $650.00 per property for a total of $2,600.00.
This fee includes travel, analysis, final report, etc.
Closing
Please contact me with any questions. If you wish to schedule the project, please contract
Patrick at 763 712 9502.
Respectfully Submitted,
Michael Bodnar, PE, CIH