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HomeMy WebLinkAboutCity Council Minutes 07-26-1993 SpecialMINUTES STUDY SESSION JULY 269 1993 A special meeting study session of the Plymouth City Council was called to order by Mayor Bergman at 4:30 p.m. in the Council Conference Room of the City Center, 3400 Plymouth Blvd., on July 26, 1993. PRESENT: Mayor Bergman, Councilmembers Edson, Helliwell and Vasiliou. Councilmember Tierney arrived at 5:00 p.m. ABSENT: None STAFF PRESENT: City Manager Johnson, Assistant City Manager Lueckert, Public Works Director Moore, Finance Director Hahn, Acting Community Development Director Ryan, and City Clerk Rauenhorst. REVIEW OF TAX INCREMENT FINANCING APPLICATIONS City Manager Johnson stated that five applications have been received in response to the City's invitation for tax increment financing applications and an additional request for a new district has also been received. The Council and staff held a study session to develop criteria for evaluation of these applications on July 12. Since that time, a staff team consisting of the Assistant City Manager, Finance Director, Acting Community Development Director, Public Works Director, and City Manager have met several times to evaluate the applications. He presented a chart showing the general information that has been received for each application, and stated that the City was also provided information on the number of jobs to be retained or created except for the spec buildings. Manager Johnson stated the greatest item of concern for staff is the meeting of the "but for" test. He stated that staff believes the "but for" test is credibly met by Rotation Engineering and might possibly be met by the AmeriData application. Staff does not believe from the information provided to date that the test is met by the Caliber and H.I. Enterprises applications. He stated that Opus Corporation has requested that their application be postponed as their project is temporarily on hold. Manager Johnson described the Hoyt application, and stated that Hoyt Enterprises proposes to move its window treatment manufacturing business to Plymouth with over 300 jobs on a site northwest of I-494 and Schmidt Lake Road. Staff believes that this application might meet all necessary criteria for TIF assistance, including the "but for" test. However, more research needs to be done to determine the type of district that should be created, the amount of increment that is likely to be generated, and the amount of HACA aid that the City could lose. The site does appear to have unusual environmental and Council Study Session July 26, 1993 Page 2 topographical conditions, as well as abutting rail service. It also has old substandard structures which contribute to costs of development. Manager Johnson stated the staff team believes if TIF assistance is granted to AmeriData and Rotation Engineering, that it should be offered on a "pay as you go" basis and that the City should share the available increment with the applicant on a 50/50 basis during the remaining life of the district, or until the amount requested is reached, whichever occurs first. He recommended that the applications of AmeriData and Rotation Engineering be placed on the August 2 City Council agenda for preliminary approval. Staff further recommends that the City require a $5,000 deposit from those applicants to pay for the cost of negotiating and preparing a legal TIF Development Agreement and to pay for costs of additional review by the City's financial advisors. Final approval of the agreements for TIF could then occur at the August 30 Council meeting. The developers would receive a refund of any portion of the $5,000 deposit not actually needed by the City for this review. John Lavander of Caliber Development Company, asked why his TIF application was not recommended for approval. Manager Johnson stated that the staff team felt there was significant doubt as to whether the "but for" test could be met with that application. He stated that staff was not convinced that the project would not proceed without TIF assistance. Manager Johnson stated it is important that the City Council be fully convinced of the "but for" test, in the event that they have to justify the TIF assistance to the state staff or legislature. Councilmember Helliwell asked how long it would take to create a new district with respect to the Hoyt application. Manager Johnson stated that it depends on the type of district to be created, but would probably take at least 60 to 90 days. Councilmember Helliwell asked what legislative changes have been made to tax increment financing. Manager Johnson stated the legislature has restructured TIF and reduced its use for certain types of things. He stated that if a new district is created, the City will lose part of its HACA. There is also a new law that cities cannot recover this loss in aid through reimbursement by the developer. Councilmember Vasiliou noted that Plymouth does not receive any local government aid; therefore, HACA is very important to the City. The City must know exactly how much aid it stands to lose should the TIF application for a new district be approved. Manager Johnson stated that some type of district, other than an economic development district, may be created for Hoyt, in which event the City would not lose HACA. Council Study Session July 26, 1993 Page 3 Steve Hoyt, Hoyt Development, supported the "pay as you go" method. He stated that his proposal would relocate 150 jobs and create 150 new jobs. Manager Johnson recommended that the staff continue working with Mr. Hoyt to determine the type of district that could be created. Councilmember Helliwell stated that she had believed the Hoyt project was underway. She stated that now the applicant is indicating that he may not build without the TIF assistance. Mr. Hoyt responded that recent estimates of special assessments for the Fernbrook Lane and Schmidt Lake Road projects, as well as cleanup costs for the site, have impacted the project planning. Councilmember Vasiliou supported the staff recommendation for preliminary approval of the two applications, and for further review of the Hoyt application. Mayor Bergman suggested that the other applicants could submit additional information to the Council and staff on how their applications meet the "but for" test. The City Council also requested that staff provide a report on how much HACA aid would be lost in the event the Hoyt application was considered. They also would like to know if the HACA reduction would be permanent, or would expire at the end of the TIF life. Mr. Lavander stated that the Caliber project has Significant soil problems. Manager Johnson stated that another factor in recommending denial of the Caliber TIF application was that Caliber has applied for grading permits and building permits. He questioned whether the City could reasonably assume that the project would not occur without the TIF funding. He invited Mr. Lavander to submit additional information for Council review. Councilmember Vasiliou stated that the H.I. Enterprises project is similar to the Caliber request in that the construction is underway. Councilmember Tierney arrived at 5:00 p.m. ASSESSMENT POLICY FOR COUNTY ROAD 9 AND DUNKIRK LANE Public Works Director Moore stated that the City Council has held a number of discussions on the proposed assessment policy for the new County Road 9 and Dunkirk Lane improvement projects. Director Moore stated that the City Council policy providing Council Study Session July 26, 1993 Page 4 for assessments on a front foot basis does not adequate fit the new County Road 9 project. The connection at County Road 24 and County Road 9 is a diagonal roadway, and the accesses and guiding in the area are not usual. He recommended because of the unusual circumstance of the new County Road 9 project, that it be assessed at $8.00 per foot (curb and gutter only), rather than $70.00 per foot as originally proposed by staff. This would reduce the amount proposed to be assessed for the new County Road 9 project, by 300,000, which could be funded through the City's State Aid Funds. He recommended that the new County Road 9 project and the Dunkirk Lane project be assessed under the City's policy of a front footage basis. Councilmember Edson asked if the church property desires access to Dunkirk Court. Public Works Director Moore stated that the church has not submitted a site plan to date, however, there will be medians in this area which would prevent left turns if the Dunkirk Court access in not provided. Councilmember Edson questioned whether a public street is needed for Dunkirk Court since it would only be used by Dundee Nursery and possibly the church property. He suggested that the access could be provided through a private driveway as an alternative to building a public street. Mayor Bergman stated the driveway could be required to have concrete curb and gutter consistent with the City's street standards. Jerry Theis, Dundee Nursery, stated he has discussed this access with City staff and is waiting to be advised as to how short this access can be. Public Works Director Moore stated that the length is flexible and the City is waiting to receive a site plan from the church property. A representative of the church stated that they have retained an architect and have met with staff to determine what they must submit for site plan approval. They hope to receive a site plan from the architect and submit it to the City by September. Mr. Theis questioned the proposed assessment rate for Parcel 3, as he stated the underlying zoning is residential. Director Moore stated that the land use lines are vague. Staff has looked at the plans submitted in that area and determined that because his property is used as a nursery and the adjacent properties are residential, the land guiding line should be between those sites. Councilmember Vasiliou asked the status of the interchange at Highway 55 and County Road 9. Council Study Session July 26, 1993 Page 5 Public Works Director Moore stated that the City's Transportation Plan indicates an interchange at this location; however, when the Council reviewed this issue several years ago, they decided not to reserve right-of-way for the interchange. It is being designed currently as an "at grade" intersection. The Council indicated that they generally approve of the proposed assessment policy to assess the Dunkirk Lane project on a front footage basis (36' wide, 7 ton street), and to assess the new County Road 9 project on a front foot basis for curb and gutter only. STUDY SESSIONS The Council established a study session at 5:00 p.m. on August 16 to meet with residents on 26th Avenue. Manager Johnson stated that staff will review the alignment alternatives and provide staking in the field. The Council requested that the City Manager contact the City of Maple Grove indicating its interest in a joint meeting on September 27 at Maple Grove. The Council reviewed a proposed letter to be sent to School District 284 relating to the proposed new high school, and grade separation issue. Staff was requested to verify the availability of funds for construction of this bridge. Manager Johnson will include in the letter to the School District that the City will be reviewing this issue over the neat few weeks and the bridge will be formally considered as part of the Capital Improvement Program if the School District decides to proceed with the project. The meeting was adjourned at 5:40 p.m. City Clerk '