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HomeMy WebLinkAboutHousing & Redevelopment Authority Minutes 01-22-2004Adopted Minutes Joint Plymouth City Council and Housing and Redevelopment Authority Meeting January 22, 2004 PRESENT: Mayor Johnson, Council Member Slavik, Council Member Stein, Council Member Bildsoe, Council Member Black, Council Member Hewitt, Commissioner Henderson, Commissioner Ludovissie, Commissioner Michlitsch and Commissioner Hibbard. ABSENT: Council Member Neset. STAFF PRESENT: City Manager Ahrens, Community Development Director Hurlburt, Housing Program Manager Barnes and HRA Specialist Jones. 1. CALL TO ORDER Mayor Johnson called the Joint City Council and Housing and Redevelopment Authority meeting to order January 22, 2004 at 7:05 p.m. Mayor Johnson gave a brief overview and then turned the meeting over to Commissioner Henderson to chair the meeting. 2. NEW BUSINESS Consider sale of City owned property located at the southwest corner of Northwest Boulevard and Schmidt Lake Road. Commissioner Henderson introduced Community Development Director Hurlburt to give an overview of the proposed project. PRESENTATION Community Development Director Hurlburt stated that on December 16, 2003, the Housing and Redevelopment Authority (HRA) requested the City Council adopt a resolution calling for a public hearing relating to the proposed sale of 6.57 acres of land. She indicated that the HRA is interested in purchasing the City owned property at the southwest corner of Northwest Boulevard and Schmidt Lake Road for the development of an affordable housing project. She added that the City Council discussed the matter briefly at the December 16th meeting and then decided to schedule a joint study session with the HRA, before a decision was made on whether or not to schedule a public hearing relating to the sale of the property. According to Community Development Director Hurlburt, if the City decides to sell the property to the HRA for the purpose of constructing an affordable housing project, the development will still need to go through the same public approval process as any other development. She added that property owners within at least 750' of the site would be notified of the public hearing relating to the proposed sale of the property as well as additional meetings throughout the development review process. Joint Plymouth City Council and Plymouth Housing and Redevelopment Authority Meeting January 22, 2004 Page 2 Community Development Director Hurlburt stated that the adjacent property, located directly south of the City owned property, recently received preliminary plat approval. She added that this development, Wynfield Place by Dean Johnson Homes, would consist of 69 units, with 13 single-family homes and 56 townhouses. According to Community Development Director Hurlburt, the City owned site is currently being used by the Public Works Department for the storage of soil. The cost of removal and disposal of the soil stored on the site is estimated at $150,000.00. Community Development Director Hurlburt indicated that whether or not the City decides to sell this property to the HRA, given the future development of the adjacent site to the south, the City would need to stop dumping soil at the site. She added that the Public Works Department is currently evaluating alternative sites. Housing Program Manager Barnes discussed the HRA's interest in the project. Specifically, he stated that the HRA's proposal has its origins in the City's 2000 Comprehensive Plan, the 2002 Housing Forum and the HRA's Strategic Plan. He also indicated that the HRA's 2004 Budget sets aside funds for a land purchase. He added that this site was identified as a possible location for an HRA sponsored housing project in the past year, as the adjacent site was going through the development process. He also stated that the HRA is interested in developing a multi -family housing project of 25-30 owner -occupied units on this site that will be compatible with the adjacent development. Housing Program Manager Barnes indicated that the cost of land is one of the greatest barriers to the construction of affordable or workforce housing. He further stated that this site was a great opportunity for the HRA to construct an affordable housing development, since the City currently owns the property and it is guided for residential development of 3-6 units per acre. He added that the HRA was interested in constructing an owner -occupied housing project with primarily three-bedroom units in the $175,000.00 - $200,000.00 price range. Community Development Director Hurlburt stated that the City and/ or HRA could put restrictive covenants on the properties limiting the future resale price of the units. She also added that the HRA was willing to purchase the property from the City for what the City paid for it in 1992 and pay for the disposal of the soil currently being stored on the site. DISCUSSION Mayor Johnson questioned how the HRA wanted to maintain the affordability of the units. Community Development Director Hurlburt stated that the HRA would most likely maintain the affordable of the units through restrictive covenants but the HRA had not made a final decision on the exact format yet. Council Member Slavik questioned the difference between the $159,250.00 the City paid for the property in 1992 and the $123,619.00 offered by the HRA. Community Development Director Hurlburt stated that this figure was less the right-of-way of Schmidt Lake Road. Joint Plymouth City Council and Plymouth Housing and Redevelopment Authority Meeting January 22, 2004 Page 3 Mayor Johnson asked how the funds from the sale of the property would have to be used if the City did sell the property to the HRA or another developer. Community Development Director Hurlburt stated that the funds from the sale of the property would have to go back into the Tax Increment Financing (TIF) account for road projects. Mayor Johnson questioned, if the City Council decides to pursue the sale of the property, what the next steps in the process would be. Community Development Director Hurlburt stated that the next step would be to set a public hearing as required by the City Charter. Surrounding property owners would be notified. Staff would develop a timeline and process for the sale of the property. Mayor Johnson questioned whether a formal bidding process was required for the City to sell the property. She also questioned how the HRA and/ or City had acquired the property for Plymouth Towne Square. Community Development Director Hurlburt stated that a formal bidding process was not required for the City to sell the property. She also added that the property for Plymouth Towne Square was purchased by the HRA from a private landowner. Mayor Johnson questioned if the City decides to sell the land to the HRA, whether the HRA can turn around and sell it at the appraised value on the open market. Community Development Director Hurlburt stated that this was a possibility but the City could put conditions on the sale of the property, if it wanted to prevent the HRA from being able to do this. Mayor Johnson questioned if the City sold the property to the HRA at a discounted price and then the HRA sold it at the appraised value on the open market whether the difference could be used throughout the City on various affordable housing projects. Community Development Director Hurlburt stated that this was not what the HRA wanted to do, since money is easier to come by than land, it would be more of a benefit to develop this site. Commissioner Henderson stated that there is a growing demand for affordable three-bedroom units. Council Member Stein questioned what the property appraised for. Housing Program Manager Barnes stated that the property appraised for $893,000.00 but this figure assumed a clean site. Council Member Stein questioned whether the price of land designated for single-family development was more expensive than land designated for multi -family development. Joint Plymouth City Council and Plymouth Housing and Redevelopment Authority Meeting January 22, 2004 Page 4 Housing Program Manager Barnes stated that they are about the same. Community Development Director Hurlburt stated that Dean Johnson Homes offered to develop the City owned property along with their property to the south, if the City donated the property to the project. Commissioner Ludovissie stated that given the soil currently be stored on the site, the HRA is unsure whether additional soil corrections will be required. Council Member Slavik questioned whether the HRA wanted the City Council to take action on the proposal tonight. Community Development Director Hurlburt stated that the HRA did not need a decision tonight but if the City wants to sell the property to the HRA or another developer, direction from the Council on how to proceed would be helpful. Mayor Johnson questioned whether the HRA would consider smaller single-family detached units instead of multi -family attached units for this site, since the development would be geared toward younger families with children. Housing Program Manager Barnes stated that the HRA is open to smaller single-family detached units instead of multi -family attached units but the difference in cost would need to be evaluated. Community Development Director Hurlburt stated that any development on this site would need to be compatible with the Dean Johnson property to the south. Commissioner Henderson stated that it is the HRA's intent to look at various options. Council Member Bildsoe questioned whether $500,000.00 homes would even be feasible on this site. Community Development Director Hurlburt stated that $500,000.00 homes would probably not be feasible on this site given the adjacent planned development to the south and the proximity to Schmidt Lake Road and Northwest Boulevard. Council Member Stein questioned the price of the Dean Johnson townhomes planned to the south. Housing Program Manager Barnes indicated that the developer had stated that townhomes will be priced around $175,000.00 - $200,000.00 and the single-family homes will be priced around 350,000.00. Council Member Hewitt stated that if Interstate 494 were expanded it would not impact this area. Mayor Johnson questioned how these properties would be marketed. Joint Plymouth City Council and Plymouth Housing and Redevelopment Authority Meeting January 22, 2004 Page 5 Housing Program Manager Barnes stated that some marketing could be done internally but the HRA would ask their non-profit or for-profit partner to take the lead. Council Member Bildsoe questioned whether the developer could manage the project for the HRA. Housing Program Manager Barnes stated that this was a possibility that the HRA could look into. Commissioner Ludovissie stated that the HRA was open to either a non-profit or for-profit partner for this project. Mayor Johnson questioned whether there would be any handicapped accessible units as part of the development. Housing Program Manager Barnes stated that the HRA would like to see at least one or two handicapped accessible units in the development. A Plymouth resident, Mark Schoenfelder at 4885 Rosewood Lane North, stated that he questions whether this project is a good use of City money. Mayor Johnson stated that the City Council has similar reservations but the Council needs to decide whether affordable housing is a priority for the City of Plymouth. Mr. Schoenfelder stated that he felt the City should take care of the removal of the soils stored on the site. He added that he felt the City should not make a decision on selling the property until the soil is removed and the true value of the property is determined. Mayor Johnson stated that the developer would most likely include the removal of the soil stored on the site as part of the deal. She also added that it would not be an efficient use of the City's time to have City staff remove the soil. Council Member Bildsoe questioned when the property would start generating tax revenue. Housing Program Manager Barnes stated that the property would start generating tax revenue as soon as it was sold to homebuyers. A Plymouth resident, Todd Johnson at 4875 Rosewood Lane North, stated that increased traffic was a concern for him and questioned when the last traffic study was done for this area. Mayor Johnson started that a traffic study was done for this area as part of the Comprehensive Plan update in 2000. She added that residential development generates the least amount of traffic of any land use, with an average of ten trips per day per home. Council Member Bildsoe stated that traffic is bad because of the commuters that come through on Northwest Boulevard from Maple Grove. Joint Plymouth City Council and Plymouth Housing and Redevelopment Authority Meeting January 22, 2004 Page 6 A Plymouth resident, John Nonbello at 4960 Rosewood Lane North, stated that re -striping of Schmidt Lake Road would help alleviate traffic. He also stated that the City should use the proceeds from the land sale to pay for pond improvements instead of raising taxes. Mayor Johnson stated that the proceeds from the land sale must go to roads. She added that affordable housing has always been an issue and that the City needs workforce housing for teachers, police officers, etc. Mr. Nonbello stated that the HRA has no track record with developing affordable housing. Mayor Johnson stated the HRA manages Plymouth Towne Square, a 100 -unit subsidized apartment building for seniors. Council Member Bildsoe stated that a diverse housing base would provide value to the community. A Plymouth resident, Laurie Paquette at 4765 Upland Lane, stated that this was a good opportunity for the HRA to have control of an affordable housing development. Housing Manager Barnes stated that he had received numerous phone calls from neighbors about this proposal. He added that most of these concerns related to property values, traffic and crime. Commissioner Ludovissie added that affordable housing options are extremely limited, so the HRA needs to jump on opportunities when they come up. He added that the proposed project was consistent with the mission of the HRA. Mr. Nonbello questioned the City's notification process for projects like the one proposed by the HRA. Community Development Director Hurlburt stated that property owners within 750' are notified and often the City goes beyond this figure for certain City sponsored projects. Mayor Johnson stated that the City already goes beyond what state law requires. Community Development Director Hurlburt added that the City also puts up blue signs to notify the public of pending applications. Mayor Johnson added that sometimes the public is notified of certain projects before City Council Members are notified. A Plymouth resident, Andy Tataryn at 4995 Rosewood Lane North, questioned whether the City would go with the HRA's proposal or solicit other proposals as well. Mayor Johnson stated that the City might consider other proposals. She added that timing was right to sell the property with the adjacent land developing. Joint Plymouth City Council and Plymouth Housing and Redevelopment Authority Meeting January 22, 2004 Page 7 Community Development Director Hurlburt stated that the City has no formal or required process to solicit proposals. Council Member Bildsoe stated that he was interested in seeking other proposals in addition to the HRA's but he wants an affordable housing component, possibly through some sort of fee reductions. Community Development Director Hurlburt stated that the City would need to be careful with fee reductions for the project as this has not been done in the past. Council Member Stein stated that he was concerned with the amount of subsidy that would go into the project, however he acknowledged that the project would generate tax revenue. Mayor Johnson stated that the money is really from the same source just different pockets. Council Member Stein questioned if it matters where affordable housing is located in the City. He added that he is unsure of the demand for affordable units as well as the demand for larger affordable units. Mayor Johnson added that we are always chasing affordability with new construction and that we should look at maintaining affordability in the existing housing stock. She added that she is concerned with an attached townhome project at this location. She indicated that she would like to see alternative housing designs for this site instead of attached townhouses. Council Member Bildsoe questioned whether staff had enough direction to proceed with the project. Community Development Director Hurlburt stated that the City Council needs to decide if the time is right to sell the property. Council Member Bildsoe stated that he felt this was a good time to sell the property and he would support joint proposals. Community Development Director Hurlburt stated that the City would need to develop criteria and set a process, before requesting proposals. Staff would bring this to the Council for approval after the public hearing. Council Member Stein stated that he is willing to look at joint proposals but he wants an affordability component and a preference for three-bedroom units. Council Member Hewitt questioned what method would be used to ensure that the owner of the townhouse lives in the unit. Commissioner Hibbard stated that restrictive covenants could be placed on the units. Joint Plymouth City Council and Plymouth Housing and Redevelopment Authority Meeting January 22, 2004 Page 8 Council Member Hewitt stated that this would be hard to enforce but if the HRA has a lien on the property (through a first time homebuyer loan) it may be easier to regulate. Community Development Director Hurlburt stated that there are lots of options that could be written into the purchase agreement to address this concern. Mr. Schoenfelder stated that there was a feeling in the neighborhood that all the decisions on the Dean Johnson property were made before the public hearing process started. Mayor Johnson stated that this was not true and added that the neighborhood had a lot of influence in the decision making process for this site through development of the Comprehensive Plan. Mr. Schoenfelder questioned whether the HRA would write the specifications for the proposal. Community Development Director Hurlburt stated that the City would write them as the owner of the property. Mayor Johnson stated that the City has always worked really hard to solicit feedback from residents. Council Member Stein questioned whether the City would advertise the project to inform the public. Community Development Director Hurlburt stated that the City would seek extra publicity if directed by the City Council. Mayor Johnson stated that she wants to start the process of selling the property; she feels the timing is right. Council Member Slavik stated that she doesn't support a concentrated affordable housing development at this location and would prefer to sell the property on the open market (for the appraised value) and donate the money to the HRA. Mayor Johnson questioned whether the City could sell the property to the HRA for a $1.00 and then have the HRA turn around and sell the property for the appraised value. Community Development Director Hurlburt stated that this was a possibility. Mayor Johnson stated that any housing in Plymouth under $300,000.00 is affordable. Council Member Black stated that she felt it was an appropriate time for the City to sell the property. She added that she is not opposed to the proposed project but somewhat uncomfortable with it. She added that the development of the property should add $35,000.00 - $75,000.00 of tax revenue to the City. She also added that she was interested in going out for an RFP and added that the project may provide benefits to the City that are not tangible. Joint Plymouth City Council and Plymouth Housing and Redevelopment Authority Meeting January 22, 2004 Page 9 Council Member Bildsoe questioned whether another joint meeting should be scheduled to discuss this proposal. Community Development Director Hurlburt recommended setting a date for the public hearing at the February 10, 2004 City Council Meeting. She also recommended deciding who should be notified of the public hearing at this meeting. Commissioner Henderson stated that most people, including herself, that bought homes 20 years ago could not afford to buy the same home today. 3. ADJOURNMENT MOTION by Commissioner Henderson, seconded by Commissioner Ludovissie, to adjourn the meeting at 9:25 p.m. Tracy L. Jones, HRA Specialist