HomeMy WebLinkAboutHousing & Redevelopment Authority Minutes 10-05-2004MINUTES
PLYMOUTH HOUSING AND REDEVELOPMENT AUTHORITY
October 5, 2004
PRESENT: Commissioners Susan Henderson, Steve Ludovissie, Jenny Hibbard, and Jim
Kovach
ABSENT: Commissioner Tim Bildsoe
STAFF PRESENT: Housing Program Manager Jim Barnes, HRA Specialist Tracy Jones, and
Office Support Specialist Ranelle Gifford
OTHERS PRESENT: None
1. CALL TO ORDER
Chair Henderson called the Plymouth Housing and Redevelopment Authority meeting to order
October 5, 2004 at 7:02 p.m.
2. CONSENT AGENDA
A. Approval of the September 16, 2004 HRA Meeting Minutes.
MOTION by Commissioner Ludovissie, seconded by Commissioner Kovach, approving the
Consent Agenda item.
Vote. 4 Ayes. Motion approved unanimously.
3. NEW BUSINESS
A. Review Senior Housing Market Study
Housing Manager Barnes gave an overview of the September 28, 2004 staff report in regards to
the demand market study conducted by Maxfield Research Inc. He said their findings were that
there is room for an additional 68 market rate units and 57 subsidized units in our targeted
market area. By 2009, the study projects the need will increase to 92 subsidized apartment units,
which indicates the demand is increasing over time. He said these findings support the concept
of the HRA building a 60 -unit, mixed income senior facility.
MOTION by Commissioner Ludovissie, seconded by Commissioner Hibbard, that the Housing
and Redevelopment Authority Board give staff the authority to begin the process of developing a
senior apartment facility and authorize the Executive Director to enter into the necessary
contracts with consultants, including architectural, financial and legal services.
Commissioner Hibbard asked what the time frame was for the senior apartment project. Housing
Manager Barnes said the overall CSM project is very time sensitive. He said CSM is proposing
to develop a commercial development at the existing Dana Spicer site. He said this is their
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October 5, 2004
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second proposal as their first attempt was denied; therefore it has become time sensitive.
Housing Manager Barnes said the HRA's process is separate from CSM's development process.
He said we would need to select an architect, issue bonds for road improvements, and acquire the
land for the housing project. Chair Henderson asked if we would need to do a full market study.
Housing Manager Barnes said only if the financial institution that issues the bonds would require
us to.
Vote. 4 Ayes. MOTION approved.
B. Review Tax Increment Redevelopment District Plan for the Shops at Plymouth Creek.
Housing Manager Barnes gave an overview of the September 28, 2004 staff report. He said the
City's Bond Attorney had recommended the HRA, rather than the City, set up the TIF District
for the CSM Shops at Plymouth Creek. He said the nature of the project relates more to the
goals of a Housing Authority under Minnesota Statutes. He said this is the first time the HRA
has established a TIF District. He said the City Council has approved the request by CSM
Investors to reguide the Dana Spicer site, which opened up the possibility for the HRA to
develop a senior housing facility.
Housing Manager Barnes said as part of the reguiding review process for this property, the City
conducted a traffic study to review the current traffic conditions. He said there are existing
traffic issues with Vicksburg Lane and Highway 55. He said regardless of what development
takes place at the Dana Spicer site, the traffic issues need to be addressed. He said the
improvements would include northbound, eastbound and westbound dual left -turn lanes. A
traffic signal would be needed at Vicksburg Lane and 32"d Avenue. Dual left -turn lanes are
needed for the eastbound approach, and a southbound right turn lane is need due to the high right
turn volume. He said the developer would be responsible for'/4 of the cost of the Vicksburg/32nd
Avenue improvements.
Housing Manager Barnes said the purchase price of $524,888 for the housing site is very
reasonable compared to other sites we have researched. Commissioner Ludovissie asked if there
is any soil preparation required for the site. Housing Manager Barnes said the developer is
providing a pad -ready site, which lowers some of the original estimated costs.
Housing Manager Barnes said the Tax Increment Financing district for this project would be a
Redevelopment district. He said Minnesota Statutes provide that at least 90 percent of the
revenues derived from tax increments from a redevelopment district be used to finance the cost
of correcting conditions that allow designation of redevelopment districts. He said qualifying
costs that meet the 90 percent requirement include purchasing the land, remediation necessary to
development of the land and installation of utilities, roads, sidewalks, and parking facilities for
the site.
Chair Henderson asked if all of the taxes paid by the businesses inside the district would be used
to pay for the improvements for the duration of the TIF district. Housing Manager Barnes said
the existing value of the land and taxes paid, which are approximately $5,000,000, will still go to
the County, City and other jurisdiction. He said the taxes on the new improvements will be
available to pay for the improvements and when the improvements are paid for they taxes will be
distributed to the respective taxing jurisdictions. Commissioner Hibbard asked if there is a way
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October 5, 2004
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for people to figure out the amount of taxes that have been generated because of the site.
Housing Manager Barnes said he would address that question when he reviewed the attached
Tax Increment Assumption report.
Housing Manager Barnes said if the project were approved, the City would issue TIF Revenue
Bonds to pay for the road improvements as well as the acquisition of the land. He said typically
when we set up a TIF district from the City's perspective, you pay as you go. However, in this
case, the improvements are considered public improvements hence the reason for issuing bonds.
Housing Manager Barnes stated the combined costs of the traffic improvements and the
acquisition of the senior housing site are $1,188,151 and based on that, the district would be in
place for 16 years and the net interest rate of the bonds would be 5.975. He also said the
scenarios include making a contribution to the City's Tax Increment Housing Assistance
Program. This is a program that allows us to pool money and take money from existing of
districts and put them into a specific account and used them at a later date for rental housing
projects. The City has done this with three of the redevelopment districts.
Housing Manager Barnes stated an alternative would be for the HRA to consider having the
Fiscal Disparities taken from outside the district, which would reduce the TIF district period by 7
years. Chair Henderson asked for the definition of Fiscal Disparities. Housing Manager Barnes
gave an overview of Fiscal Disparities and the pros and cons of taking it from outside the district
vs. inside the district.
Commissioner Ludovissie said Highway 55 is a state highway the State should share some of the
roadway improvement costs. Housing Manager Barnes said there is a Highway 55 Corridor
Commission that is currently addressing possible improvement plans.
Housing Manager Barnes discussed the "But -For" Analysis. He said the traffic study shows the
traffic conditions are pre-existing and regardless of the type of development that occurs, the
improvements would be required. City staff, along with the City's financial consultants, have
reviewed the project and have determined the project to be feasible and the costs associated to be
justified.
Housing Manager Barnes said the cost of the improvements would not have a direct financial
impact on the City or HRA finances. Chair Henderson asked how we determine if there is
enough money to fund the project. Housing Manager Barnes reviewed the assumption and
projected tax increment reports prepared by Springsted Incorporated. He said Springsted
reviews the project information and then provides pertinent financial figures. Commissioner
Kovach asked if there would be cost overruns and if so, if there is room for adjustment. Housing
Manager Barnes said it takes a couple months for the traffic engineers to get final costs so those
numbers can fluctuate. He said we would have final numbers before we finalize the TIF plan.
Commissioner Hibbard asked if you could establish multiple TIF Districts at one time. Housing
Manager Barnes answered affirmatively. He said the City been very conservative to this point
with establishing TIF districts.
MOTION by Commissioner Hibbard, seconded by Commissioner Ludovissie, that the Plymouth
Housing and Redevelopment Authority Board of Commissioners direct staff to prepare a TIF
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October 5, 2004
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plan and recommend that the City Council consider establishing a Tax Increment Finance
Redevelopment District. Vote. 4 Ayes. MOTION approved.
Chair Henderson asked if the housing project time frame would be three years. Housing
Manager Barnes said it would be closer to two years for completion of the senior housing
project.
4. ADJOURNMENT
Meeting adjourned at 7:55 p.m.
HRA/Minutes/ 10/04/04