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HomeMy WebLinkAbout2024.12.09 CCP EDAE conomic Development Authority City Hall Council Chambers December 9, 2024 AGE NDA 1.Call to Order The City Council requests that attendees turn off cell phones and pagers during the meeting. A copy of the full C ity Counc il packet, including E D A (E conomic Development Authority ), is available to the public. The packet ring binder is located at the entrance of the council chambers. 2.Roll Call 3.Approval of Consent Agenda The following items are considered to be routine by the Economic Development Authority (E D A) and will been acted by one motion. There will be no separate disc ussion of these items unless a Commissioner so requests, in whic h event the item will be removed from the c onsent agenda and considered at the end of Commission Consideration I tems. a.Approval of Minutes - Motion to approve the minutes. 4.Commission Consideration Items a.Termination of a T I F Development Agreement Between the E conomic Development Authority of B rooklyn Center and K K MB A B rooklyn Center L L C for the HO M F urniture project - Motion to approve a Resolution Approving Termination of a Development Agreement. *This action will be contingent on the approval of Planning Commission Application No. 2024-012. If the PUD amendment is denied, then KKMBA Brooklyn Center L L C would no longer agree to a voluntary termination of the TIF agreement. 5.Adjournment Economic Development Authority DAT E:12/9/2024 TO :C ity C ouncil F R O M:D r. Reggie Edwards, City Manager T H R O U G H :Reggie Edw ards , D eputy City Manager BY:Barb S uciu, A ssistant City Manager/C ity C lerk S U B J E C T:A pproval of Minutes Requested Council A con: - Moon to approve the minutes. B ackground: I n accordance with M innesota S tate S tatute 15.17, the official records of all mee5ngs must be documented and approved by the governing body. B udget I ssues: N/A I nclusive C ommunity Engagement: - None A nracist/Equity Policy Effect: - None S trategic Priories and Values: AT TA C H M E N TS : D escrip5on U pload D ate Type 11.25 E DA 12/5/2024 Backup M aterial 11/25/24 -1- DRAFT MINUTES OF THE PROCEEDINGS OF THE ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA REGULAR SESSION NOVEMBER 25, 2024 CITY HALL – COUNCIL CHAMBERS 1. CALL TO ORDER The Brooklyn Center Economic Development Authority (EDA) met in Regular Session called to order by President April Graves at 8:22 p.m. 2. ROLL CALL President April Graves and Commissioners Marquita Butler, Dan Jerzak, and Teneshia Kragness. Commissioner Kris Lawrence-Anderson was absent and excused. Also present were City Manager Reggie Edwards, Economic Development Manager Ian Alexander, Community Development Director Jesse Anderson, Assistant City Manager/City Clerk Barb Suciu, and City Att orney Siobhan Tolar. 3. APPROVAL OF AGENDA AND CONSENT AGENDA Commissioner Jerzak moved and Commissioner Kragness seconded to approve the Agenda and Consent Agenda, and the following item was approved: 3a. APPROVAL OF MINUTES 1. September 9, 2024 Motion passed unanimously. 4. COMMISSION CONSIDERATION ITEMS 4a. PURCHASE AND DEVELOPMENT CONTRACT WITH AWC HOLDINGS LLC (JAMBO AFRICA PROJECT) Executive Director Reggie Edwards introduced the item and invited Economic Development Manager Ian Alexander to continue the Staff presentation. Economic Development Manager Ian Alexander pointed out the applicant is present. He explained that 6500 Camden Avenue North is an approximately 1.62-acre parcel located to the west of Trunk Highway (TH) 252, to the north of Top Golf (6420 Camden Avenue North), to the south of an 11/25/24 -2- DRAFT approximately 10,000-square foot mall (615 66th Avenue North) and Speedway (6545 West River Road), and to the east of Melrose Gates Apartments (6401 Camden Avenue North). The property is zoned Planned Unit Development/Commerce (PUD/C2) District. He showed an aerial image of the site. It has previously been used as parking for Metro Transit. Mr. Alexander noted the site is somewhat difficult due to easements in the middle of the area. The City has invested $685,000 into the property. The City’s Economic Development Authority acquired the property in 2017 as part of a strategic acquisition where the City purchased a vacant lot as part of an overall strategy to enhance the planned redevelopment of the Regal Theater site and facilitate a land exchange with Top Golf Brooklyn Center LLC that would provide the EDA with options to maximize land use opportunities and transportation improvements associated with the proposed future 66th Avenue Interchange and TH 252 improvements. Mr. Alexander stated the proposed concept is for Jambo Africa restaurant and nightclub. The offer was $500,000 for 1.62 acres which is about $7.085 per square foot. The EDA acquired the former Target for $9.10 per square foot and Topgolf acquired Regal Theater for $10.00 per square foot. Mr. Alexander stated the Purchase and Development Agreement identifies terms of $10,000 earnest money, 30 days due diligence to study the site, developer-paid EDA costs, the developer must complete Planning Commission processes, the developer shall commence construction within 30 days from closing but no later than December 25, 2025, and the developer shall substantially complete construction by April 25, 2026. President Graves asked if the underground main had been considered in the planning efforts. Mr. Alexander explained the purchase price considers the underground main, and the easements have been considered in the planning so far. Other concepts have been pitched for the site, but it has been difficult to situate a building on the property. President Graves moved and Commissioner Kragness seconded to open the public hearing. Motion passed unanimously. Kevin S. stated it is a great proposal. He pointed out the area can be very busy when Topgolf hosts an event. He asked if the proposal included widening the access. Nahid K. noted she lives near the site. She looks forward to seeing Jambo Africa grow. He asked if any Park and Ride spots would remain. If the Park and Ride is eliminated, she asked where it would be relocated to. She asked how the future of Hwy 252 would impact the project. Ultimately, she wants the Council to carefully consider potential impacts to ensure success for Jambo Africa. Commissioner Jerzak moved and Commissioner Kragness seconded to close the public hearing. Motion passed unanimously. 11/25/24 -3- DRAFT Community Development Director Jesse Anderson stated there are no plans to expand the road. However, the Planning Commission process includes reviewing parking spots and traffic impacts. As for the Park and Ride lot, it is fairly under-utilized with five to ten riders per day. There is a potential for a private agreement to continue the Park and Ride. President Graves moved and Commissioner Kragness seconded to adopt EDA RESOLUTION NO. 2024-03, A Resolution Approving a Purchase and Development Contract with AWC Holdings, LLC, Approving Conveyance of Certain Property, and Approving a Business Subsidy (Jambo Africa Project). Motion passed unanimously. 5. ADJOURNMENT Commissioner Butler moved and Commissioner Jerzak seconded adjournment of the Economic Development Authority meeting at 8:34 p.m. Motion passed unanimously. Economic Development Authority DAT E:12/9/2024 TO :C ity C ouncil F R O M:D r. Reggie Edwards, City Manager T H R O U G H :J esse A nders on, C ommunity D evelopment D irector BY:J ason A arsvold, Ehlers S U B J E C T:Termina.on of a T I F D evelopment A greement Betw een the Economic D evelopment A uthority of Brooklyn C enter and K K M B A Brooklyn Center L L C for the H O M F urniture project Requested Council A con: - Moon to approve a Resoluon A pproving Terminaon of a D evelopment A greement. *This acon will be conngent on the approval of P lanning C ommission A pplicaon No. 2024-012. I f the P U D amendment is denied, then K K M B A Brookly n C enter L LC w ould no longer agree to a voluntary terminaon of the T I F agreement. B ackground: O n D ecember 11, 2017, the E DA entered into an agreement with K K M B A Brooklyn C enter, L L C (the “D eveloper ”) for redevelopment of the former Kohl’s s ite located within S hingle C reek Cros s ing at the s outhw est intersec.on of Bass L ake Road and H ighw ay 100. The agreement required the D eveloper to undertake, at minimum, renova.on of an approximately 75,000 s quare foot substandard retail building that would become a new H O M furniture loca.on and cons truc.on of approximately 23,600 square feet of addi.onal retail s pace cons is tent with the P U D and approved development plans . The E DA agreed to provide up to $3,272,400 in pay-as -you-go tax increment financing as s is tance from T I F D istrict No. 7 upon comple.on of the required minimum improvements. G iven the current status and asses s ed value of the project, however, the projected amount of T I F the project w ould actually generate is approximately $600,0000. The agreement also contemplated addi.onal assistance for “F uture I mprovements” to offs et future stormwater management costs. The D eveloper completed renova.on of the 75,000 sq. G. building for occupancy by H O M furniture, but only constructed the “s hell” for the addi.onal retail space. I n addi.on, the D eveloper did not move forward w ith the “F uture I mprovements ” iden.fied in the agreement. For these reasons, the T I F note for the project was never is s ued, no payments w ere made to the D eveloper, and the D eveloper did not receive any addi.onal as s is tance in connec.on w ith the “F uture I mprovements .” The D eveloper is currently propos ing to build out the retail shell s pace for occupancy by the S ocial S ecurity A dministra.on w hich w ould be a purely office use. The T I F as s is tance granted to the project w as intended to bols ter retail development in the S hingle C reek Cros s ings area, not to s upport office development. The exis .ng P U D and approved development plans w ould not allow for office us e at this loca.on. The developer, how ever, is reques .ng an amendment to the P U D to allow the S ocial S ecurity A dministra.on to occupy the s pace. This item is panned for cons idera.on by the City Council on D ecember 9, 2024. I f the City Council decides to approve the amendment, then staff recommends termina.on of the T I F agreement. The purpos e of this ac.on is approve a termina.on of the exis.ng T I F D evelopment A greement. I f approved, the E DA and the D eveloper w ould be released from all obliga.ons contained w ithin the agreement. The E DA will not be obligated to make any payments to the developer B udget I ssues: This item w ill have no immediate effect on the budget. I nclusive C ommunity Engagement: A nracist/Equity Policy Effect: S trategic Priories and Values: Maintain a s trong financial pos i.on, S trengthen and divers ify busines s development and hous ing AT TA C H M E N TS : D escrip.on U pload D ate Type Res olu.on 12/5/2024 Resolu.on LeIer Termina.on of T I F A greement 12/2/2024 Backup M aterial BR291-371-993417.v1 Commissioner _______________________ introduced the following resolution and moved its adoption: EDA RESOLUTION NO. _____________ APPROVING TERMINATION OF DEVELOPMENT AGREEMENT (HOM FURNITURE, INC. PROJECT) WHEREAS, the Economic Development Authority of Brooklyn Center, Minnesota, a public body corporate and politic (the “EDA”) and KKMBA Brooklyn Center LLC, a Minnesota limited liability company (the “Developer”) entered into a TIF Development Agreement, dated December 11, 2017 (the “TIF Development Agreement”), in connection with the Developer’s proposed construction of the Minimum Improvements and the Storm Water Improvements (as defined in the TIF Development Agreement) on certain property in the City of Brooklyn Center, Minnesota (the “City”) and the EDA’s use of public assistance to reimburse the Developer for certain costs related thereto; and WHEREAS, the Developer has not completed the conditions for the disbursement of the tax increment financing assistance under the TIF Development Agreement and the Developer proposes use of the Development Property that is inconsistent with the retail use contemplated in the TIF Development Agreement and the existing PUD (as defined therein); WHEREAS, the City Council of the City has approved an amendment to the PUD as requested by the Developer subject to the Developer’s execution of that certain Termination of TIF Development Agreement between the EDA and the Developer (the “Termination”) prepared for consideration of the EDA; NOW, THEREFORE, BE IT RESOLVED BY the Board of Commissioners (the “Board”) of the Economic Development Authority of Brooklyn Center, Minnesota as follows: 1. The EDA hereby approves the Termination in substantially the form presented to the Board, together with any related documents necessary in connection therewith, (collectively, the “Termination Documents”) and hereby authorizes the President and Executive Director to execute the Termination Documents on behalf of the EDA, and to carry out, on behalf of the EDA, the EDA’s obligations thereunder when all conditions precedent thereto have been satisfied. 2. The approval hereby given to the Termination Documents includes approval of such additional details therein as may be necessary and appropriate and such modifications thereof, deletions therefrom and additions thereto as may be necessary and appropriate and approved by legal counsel to the EDA and by the officers authorized herein to execute said documents prior to their execution; and said officers are hereby authorized to approve said changes on behalf of the EDA. The execution of any instrument by the appropriate officers of the EDA herein authorized shall be conclusive evidence of the approval of such document in accordance with the terms hereof. This Resolution shall not constitute an offer and the Termination Documents shall not be effective until the date of execution thereof BR291-371-993417.v1 as provided herein. In the event of absence or disability of the authorized officers, any of the documents authorized by this Resolution to be executed may be executed without further act or authorization of the Board by any duly designated acting official, or by such other officer or officers of the Board as, in the opinion of legal counsel to the EDA, may act in their behalf. _________________________ _____________________________ Date President The motion for the adoption of the foregoing resolution was duly seconded by Commissioner and upon vote being taken thereon, the following voted in favor thereof: and the following voted against the same: whereupon said resolution was declared duly passed and adopted. 4299319.v2 TERMINATION OF TIF DEVELOPMENT AGREEMENT THIS TERMINATION OF TIF DEVELOPMENT AGREEMENT (this “Termination”) is made this ______ day of ___________________, 2024, by and between the Economic Development Authority of Brooklyn Center, a body corporate and politic under the laws of the State of Minnesota (the “EDA”), and KKMBA Brooklyn Center LLC, a Minnesota limited liability company (the “Developer”). WITNESSETH: WHEREAS, the EDA and the Developer entered into a TIF Development Agreement, dated December 11, 2017 (the “TIF Development Agreement”), in connection with the Developer’s proposed construction of the Minimum Improvements and the Storm Water Improvements (as defined in the TIF Development Agreement) on certain property in the City and the EDA’s use of public assistance to reimburse the Developer for certain costs related thereto; and WHEREAS, the Developer has not completed the conditions for the disbursement of the tax increment financing assistance under the TIF Development Agreement and the Developer proposes use of the Development Property that is inconsistent with the retail use contemplated in the TIF Development Agreement and the PUD (as defined therein). NOW, THEREFORE, in consideration of the covenants hereinafter set forth and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 1. Termination of TIF Development Agreement. Upon execution of this Termination, the EDA and the Developer agree that the parties hereto are released from all obligations under the TIF Development Agreement which shall thereupon be terminated and shall have no further force or effect as of the date hereof. 2. Recitals. The foregoing recitals are incorporated into this Termination. S-1 4299319.v2 IN WITNESS WHEREOF, the EDA and the Developer have executed this Termination of TIF Development Agreement as of the date and year first written above. ECONOMIC DEVELOPMENT AUTHORITY OF BROOKLYN CENTER, MINNESOTA By: Name: Title: President By: Name: Title: Executive Director STATE OF MINNESOTA ) ) ss. COUNTY OF ___________ ) The foregoing instrument was acknowledged before me this ____ day of _________, 2024, by ________________________, the President of the Economic Development Authority of the City of Brooklyn Center, on behalf of the EDA. Notary Public STATE OF MINNESOTA ) ) ss. COUNTY OF ___________ ) The foregoing instrument was acknowledged before me this ____ day of _________, 2024, by _______________________, the Executive Director of the Economic Development Authority of the City of Brooklyn Center, on behalf of the EDA. Notary Public S-2 4299319.v2 KKMBA BROOKLYN CENTER LLC, a Minnesota limited liability company By: Name: Title: STATE OF MINNESOTA ) ) ss. COUNTY OF ) The foregoing instrument was acknowledged before me this _____ day of ____________, 2024, by _______________________, the _________________________ of KKMBA Brooklyn Center LLC, a Minnesota limited liability company, on behalf of the limited liability company. Notary Public This Instrument was drafted by: Kennedy & Graven, Chartered (JSB) 150 S. 5th St., Ste. 700 Minneapolis, MN 55402 (612) 337-9300