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HomeMy WebLinkAbout2001 01-08 EDAM Regular Session 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 JANUARY 8, 2001 CITY HALL 1. CALL TO ORDER The Brooklyn Center Economic Development Authority (EDA) met in regular session and was called to order by President Myrna Kragness at 7:36 p.m. 2. ROLL CALL President Myrna Kragness, Commissioners Kay Lasman, Ed Nelson, and Robert Peppe. Also present: City Manager Michael J. McCauley, Assistant City Manager Jane Chambers, Public Works Director Diane Spector, Planning and Zoning Specialist Ron Warren, City Attorney Charlie LeFevere, and Deputy City Clerk Maria Rosenbaum. 3. APPROVAL OF AGENDA AND CONSENT AGENDA A motion by Commissioner Lasman, seconded by Commissioner Peppe to approve the agenda and consent agenda. Motion passed unanimously. 3a. APPROVAL OF MINUTES A motion by Commissioner Lasman, seconded by Commissioner Peppe to approve the December 11, 2000, regular session and December 21, 2000, special session minutes. Motion passed unanimously. 4. COMMISSION CONSIDERATION ITEMS 4a. RESOLUTION ELECTING OFFICERS FOR THE ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF BROOKLYN CENTER Executive Director Michael McCauley discussed that this resolution would elect the following officers for the Economic Development Authority in and for the City of Brooklyn Center: 01/08/01 -1- i i President/Treasurer Myrna Kragness Vice President Kay Lasman Assistant Treasurer Bob Sundberg Secretary G. Brad Hoffman RESOLUTION NO. 2001-01 Commissioner Lasman introduced the following resolution and moved its adoption: RESOLUTION ELECTING OFFICERS FOR THE ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF BROOKLYN CENTER The motion for the adoption of the foregoing resolution was duly seconded by Commissioner Peppe. Motion passed unanimously. 4b. RESOLUTION APPROVING AND AUTHORIZING EXECUTION OF A DEVELOPMENT AGREEMENT Mr. McCauley discussed that this resolution would approve and authorize execution of a development agreement between the EDA and Twin Lakes Three LLC (Real Estate Recycling) for phase three of the Joslyn redevelopment project. Mr. McCauley suggested that it would be appropriate to spend sometime in discussing this item since the agreement before the EDA was different than the framework used in phases one and two. In phases one and two, the developer received Tax Increment Financing (TIF) on a pay as you go basis from each of the phases of development. In the draft document before the EDA this evening, the source of money to provide assistance to phase three would come from TIF District Three, rather than TIF Four in which the project was located. TIF from District Three in the proposal before the EDA would be paid to the developer over a three -year period. In phases one and two, TIF was available for each phase for a period up to ten years from the beginning of the receipt of tax increment for that phase. The proposed redevelopment that would occur in phase three would have a market value in the $3 Million to 4 Million dollar range. This would be an increase over the current value of $1.2 Million. This redevelopment would generate between $180,000 and $200,000 plus in increment. These monies could be used to repay TIF District Three or used in TIF District Four. Mr. McCauley recommended that either phase three be returned as soon as possible to the general tax rolls to capture the increased value or that the increment be used to repay TIF District Three. Mr. McCauley recommended against using any increment generated by phase three of the Joslyn Development to reduce or make payments for phases one and two. 01/08/01 -2- Since the developer's arrangement in phases one and two with the EDA provides that the developer receives only the a ments generated from each phase and only for a ton-year period it would be PY g p Y Y changing the negotiated deal to add additional resources to that stream of tax increment payments to the developer. The EDA then raised several questions regarding why this was being set up for a three year repayment and the use of proceeds from tax increment financing district number three. Mr. Mac Hyde and Mr. Paul Hyde provided several answers to the EDA. Mr. Paul Hyde indicated that the reason that a three -year period of time was presented was a requirement of his lenders. Since phase three required the demolition of the Dale Tile property that would be part of the lender's security, the lenders required a short pay back period in order to go forward with the financing. Mr. McCauley advised that the three -year period of time would be insufficient to generate the required tax increment since it would take between six or more years to repay the proposed use of TIF. The proposal for phase three was similar to phases one and two since the target write down was a bare land value of $2 per square foot after costs of remediation and demolition to create the developed site. Phase three has received grant funding from the Department of Trade and Economic Development and the Metropolitan Council. RESOLUTION NO. 2001-02 Commissioner Peppe introduced the following resolution and moved its adoption: RESOLUTION APPROVING AND AUTHORIZING EXECUTION OF A DEVELOPMENT AGREEMENT The motion for the adoption of the foregoing resolution was duly seconded by Commissioner Nelson. Motion passed unanimously. 5. ADJOURNMENT A motion by Commissioner Nelson, seconded by Commissioner Lasman to adjourn the meeting at 10:10 p.m. Motion passed unanimously. lf� 1 U President 01/08/01 -3-