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HomeMy WebLinkAbout2005 12-12 EDAP EDA MEETING City of Brooklyn Center December 12, 2005 AGENDA L Call to Order —The EDA requests that attendees turn off cell phones and pagers during the meeting. 2. Roll Call 3. Approval of Agenda and Consent Agenda —The following items are considered to be routine by the Economic Development Authority (EDA) and will be enacted by one motion. There will be no separate discussion of these items unless a Commissioner so requests, in which event the item will be removed from the consent agenda and considered at the end of Commission Consideration Items. a. Approval of Minutes Commissioners not present at meetings will be recorded as abstaining from the vote on the minutes. 1. November 14, 2005 Regular Session 4. Commission Consideration Items a. Resolution Approving the Final Budget for the City of Brooklyn Center Economic Development Authority -Requested Commission Action: Motion to adopt resolution. b. Resolution rescinding Resolution No. 2004 -18 and Resolution No. 2004 -19 1. Resolution Rescinding the Determination to Acquire Real Property by Eminent Domain in Resolution No. 2004 -18 Brookdale Ford -Requested Commission Action: Motion to adopt resolution. 2. Resolution Rescinding the Determination to Acquire Real Property by Eminent Domain in Resolution No. 2004 -19 Brookdale Square -Requested Commission Action: Motion to adopt resolution. 5. Adjournment EDA Agenda Item' NO' 3a 4 r 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 14, 2005 CITY HALL COUNCIL CHAMBERS 1. CALL TO ORDER The Brooklyn Center Economic Development Authority (EDA) met in Regular Session and was called to order at 9:40 p.m. by President Myrna Kragness. 2. ROLL CALL President Myrna Kragness and Commissioners Kathleen Carmody, Kay Lasman, Diane Niesen, and Mary O'Connor. Also present were City Manager /Executive Director Michael McCauley, Assistant City Manager /Director of Operations Curt Boganey, City Attorney Charlie LeFevere, City Clerk Sharon Knutson, and Deputy City Clerk Camille Yungerberg. 3. APPROVAL OF AGENDA AND CONSENT AGENDA Commissioner Lasman moved and Commissioner Carmody seconded to approve the agenda and consent agenda and the following item was approved: 3a. APPROVAL OF MINUTES ck S' e-v%, i1 e j n +kMf GrK 44Kcn&K141 1. October 10, 2005 Regular Session Motion passed unanimously. ALA- 4. COMMISSION CONSIDERATION ITEM 4a. RESOLUTION AUTHORIZING THE ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OFB B ROOKLYN CENTERFROM TO PURCHASE A NEW FT900 DISH HOBART COMPANY RESOLUTION NO. 2005-15 Commissioner Lasman stated a new dishwashing system would be a good investment, considering the amount of labor and water that will be saved. Assistant City Manager /Director of Operations Curt Boganey explained that the salvageable value of the existing system is minimal; however the City will attempt to recoup some cost. cone that the Commissioner O'Connor stated ;mss e ®c •Gch; Hobart Company 4uis i v r aS er a S of n q b 1 e. oa h d w a v� S a s e ij Mr. Boganey explained that alternative companies were looked at; however the Hobart Company 11/14/05 -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 14, 2005 CITY HALL COUNCIL CHAMBERS 1. CALL TO ORDER The Brooklyn Center Economic Development Authority (EDA) met in Regular Session and was called to order at 9:40 p.m. by President Myrna Kragness. 2. ROLL CALL President Myrna Kragness and Commissioners Kathleen Carmody, Kay Lasman, Diane Niesen, and Mary O'Connor. Also present were City Manager /Executive Director Michael McCauley, Assistant City Manager /Director of Operations Curt Boganey, City Attorney Charlie LeFevere, City Clerk Sharon Knutson, and Deputy City Clerk Camille Yungerberg. 3. APPROVAL OF AGENDA AND CONSENT AGENDA Commissioner Lasman moved and Commissioner Carmody seconded to approve the agenda and consent agenda and the following item was approved: 3a. APPROVAL OF MINUTES 1. October 10, 2005 Regular Session Motion passed unanimously. 4. COMMISSION CONSIDERATION ITEM 4a. RESOLUTION AUTHORIZING THE ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF BROOKLYN CENTER (EDA) TO PURCHASE A NEW FT900 DISHWASHING SYSTEM FROM HOBART COMPANY RESOLUTION NO. 2005-15 .Commissioner Lasman stated a new dishwashing system would be a good investment, considering the amount of labor and water that will be saved. Assistant City Manager /Director of Operations Curt Boganey explained that the salvageable value of the existing system is minimal; however the City will attempt to recoup some cost. Commissioner O'Connor stated the existing machine could be fixed and stated concern that the Hobart Company misled the City into purchasing a new system. Mr. Boganey explained that alternative companies were looked at; however the Hobart Company 11/14/05 -1- DRAFT is the best choice. He further explained that the City purchased an add -on feature for the existing machine a few years ago that is compatible with the proposed system. He stated this investment would be lost if the machine was purchased from a different company. Commissioner O'Connor stated opposition to approval of the proposed, due to the cost. Commissioner Lasman moved and Commissioner Carmody seconded adoption of RESOLUTION NO. 2005 -15 Authorizing the Economic Development Authority in and for the City of Brooklyn Center (EDA) to Purchase a New FT900 Dishwashing System from Hobart Company. Commissioner O'Connor voted against the same. Motion passed. 4b. MAILING FOR OPPORTUNITY SITE OPEN HOUSE Mr. McCauley explained the cost of the direct mailing, color verses black and white. He stated First Class mail would be used to insure prompt and reliable delivery. President Kragness stated the informational mailing will alleviate many questions. Councilmember Niesen suggested that open house event be filmed for a cable television broadcast. Commissioner Cannody stated a color mailing would draw more attention and would less likely be disposed of with other insignificant mail. Mr. McCauley suggested a color distribution rather than black and white due to the minimal cost difference of $600.00. Commissioner Carmody moved and Commissioner Niesen seconded to approve a citywide direct mailing in color for the Opportunity Site Open House. Motion passed unanimously. 5. ADJOURNMENT Commissioner Lasman moved and Commissioner Carmody seconded adjournment of the meeting at 9:55 p.m. Motion passed unanimously. President 11/14/05 -2- DRAFT 4 EDA Agenda Item NQ. 4a Member introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION APPROVING THE FINAL BUDGET FOR THE CITY OF BROOKLYN CENTER ECONOMIC DEVELOPMENT AUTHORITY WHEREAS, the Economic Development Authority of City of Brooklyn Center has considered the final budget for Fiscal Year 2006. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority of the City of Brooklyn Center, Minnesota that revenues and appropriations for the Economic Development Authority are hereby adopted as follows: Economic Development Authoritv Revenues Other Financing Sources 257.065 Total Economic Development Authority 257.065 Appro priations EDA Operations $261.319 Total Economic Development Authority $261.319 December 12. 2005 Date President ATTEST: City Clerk 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. EDA Agenda, Item loo. 4b City of .Brooklyn Center A Millennium Community To: President Kragness and Commissioners Carmody, Lasman, Niesen, and O'Connor From: Michael J. McCauley Executive Director Date: December 7, 2005 Re: Staff Report on Proposed Resolutions Rescinding EDA Resolutions No. 2004 -18 and 2004 -19 Beginning in 2001 and culminating in January 2003 with a final report, the Metropolitan Council undertook an Opportunity Site study that encompassed an area between Shingle Creek Parkway and Highway 100 from I -94 south, an area west of Shingle Creek Parkway and south of 59 avenue to Highway 100, and the commercial properties west of Logan on either side of Bass Lake Road. Their report recommended several concepts for creating a retail core and town center vision to guide future redevelopment to revitalize Brooklyn Center's central area. In 2004, the Economic Development Authority had a series of work sessions to explore ways to approach redevelopment in the Opportunity Site areas. Based on the Metropolitan Council report and the limited resources available, a general focus was made on redeveloping the Northbrook/Hmong America Shopping Center site and exploring the potential assemblage of a large parcel north of Bass Lake Road. The specific parcels comprising Brookdale Ford and Brookdale Square were selected as a primary focus. Brookdale Ford is located in TIF District 3 and funds are available for redevelopment purposes. Brookdale Square is outside TIF District 3, but there are limited funds available for expenditure outside the district. In the review of possible acquisitions, one of the goals was to pursue possible opportunities while keeping other options open should initial efforts prove infeasible. Brookdale Ford In late 2003, Mr. Hoffman was approached by Mr. Grossman, owner of the Brookdale Ford dealership. At that time, Mr. Grossman's dealership was a lessee with a lease that expired at the end of 2006. Mr. Grossman was inquiring about the potential to re- locate his dealership. Those discussions resulted in a presentation to the City Council at the January 12, 2004 Work Session. The City Council was asked whether it would consider a Planned Unit Development for a relocated Brookdale Ford along Freeway Blvd. The Council indicated that it would consider such request. On July 12, 2004, the EDA/City Council received a report regarding a requested letter of intent that Mr. Grossman was seeking. That letter of intent would have been for the purpose of setting a direction for 6301 Shingle Creek Parkway Recreation and Community Center Phone TDD Number Brooklyn Center, MN 55430 -2199 (763) 569 -3400 City Hall TDD Number (763) 569 -3300 FAX (763) 569 -3434 FAX (763) 569 -3494 www.cityofbrooklyncenter.org negotiation of a formal, comprehensive agreement, but would not have been binding on either the EDA or Mr. Grossman to conclude an agreement. Based on the discussions regarding Mr. Grossman's interest in relocating to Freeway Boulevard, staff felt that it would be advantageous to be in a position to acquire the underlying fee interest of the Brookdale Ford land if the automobile dealership were relocated. This would avoid issues related to adversely acquiring an automobile dealership and be consistent with focusing on assembling a parcel for redevelopment. On December 13, 2004 the EDA adopted a resolution authorizing acquisition of the Brookdale Ford property through negotiation or the exercise of eminent domain. From staff s perspective, the premise to acquisition of the underlying fee interest was a resolution of the relocation of Brookdale Ford. At the time of the resolution, staff was working with Mr. Grossman and his consultant on a relocation to Freeway Boulevard. Staff continued discussions with Mr. Grossman on site layout and acquisition issues through the 1" half of 2005. Staff and Mr. Grossman were unable to arrive at a mutually agreeable proposed development agreement. In June of 2005, Mr. Grossman purchased the fee interest in the Brookdale Ford property. He has also represented that he is unable to relocate his dealership due to State laws and Ford Motor Company. Mr. Grossman has advised the Council and staff that he wishes to remain in business at his current location and that he would be put out of business unless he can remain in his current location. The discussions over the past 2 years with Mr. Grossman were seen as an opportunity to benefit both Mr. Grossman and the EDA. Accepting Mr. Grossman's assessment of the law and Ford Motor Company's view of relocation, staff would not recommend a course of action that could potentially put the company out of business. Accordingly, we are recommending adoption of the proposed resolution rescinding EDA Resolution No. 2004 -18. This would remove any issue regarding the EDA's intentions and avoid potential costs in excess of the EDA's capacity or a reasonable value for purposes of redevelopment. Mr. Grossman's attorney has indicated a view of valuation, assuming a loss of the business, in excess of $20 Million. Brookdale Sauare Brookdale Square was selected as a potential opportunity for redevelopment in conjunction with the opportunity presented by Mr. Grossman's negotiations /discussions to relocate Brookdale Ford. Acquiring Brookdale Square without also acquiring Brookdale Ford would be less desirable from a redevelopment standpoint. Brookdale Square lacks meaningful frontage on Bass Lake Road and is somewhat screened from Brookdale itself, and there are limited opportunities for acces to the Brookdale Square parcel. Staff and the EDA's counsel, Mr. Manderscheid, have met with the owners of Brookdale Square and given indications of acquisition amounts that the staff feel are reasonable in light of Brookdale Square's tax court appeal and reduction of the assessed valuation to $3.8 Million. Brookdale Square has not changed its initial position from $10.2 Million as the value of the property. Mr. Manderscheid has not received any counter offers to a staff response to a request from Brookdale Square's attorney for an offer. We have also not received any cooperation for our appraiser to conduct an Page 2 12/08/2005 appraisal. In both the Brookdale Ford and Brookdale Square properties, we have engaged independent appraisers to conduct appraisals to provide us with additional information to assess valuation. Neither owner has been willing to cooperate with the EDA in that process. Summary The EDA/City have embarked on a process to seek redevelopment along the vision developed by the Metropolitan Council study and as is being developed by the Task Force and Damon Farber Associates. We are suggesting that the inability to reasonably assemble a large redevelopment tract without driving a significant number of jobs out of the City makes rescission of the resolutions appropriate. Staff does not believe it is in the EDA's interest to continue pursuit of these two properties. If the standards and plan being developed by the Task Force are adopted, we would recommend pursuit of a first phase that would consist of housing, after developing a financing plan and determining the ability to assemble land through negotiation. We have been unable to negotiate acquisition of ether Brookdale Square or Brookdale Ford and without assemblage of both parcels, we do not see a point in acquiring either at this time. In the case of Brookdale Ford, we do not recommend a course that would potentially put this company out of business due to franchise issues or potentially cost the EDA $20+ Million. This is especially the case as we seek to develop housing in light of legislative proposals to eliminate the use of eminent domain for economic development. The primary impact of the current study by the Task Force and Damon Farber Associates, consistent with the Metropolitan Council Study, would be to create housing opportunities north of Brookdale Ford. Housing is the engine, both financially and in terms of redevelopment impact, for the overall Opportunity Site concept. If we were to acquire these parcels at unreasonable costs and find that we could not either negotiate or use eminent domain to create housing opportunities north of these parcels, the use of resources would not result in the desired results to stimulate and create a redevelopment of the area having a net positive financial impact. Page 3 12/08/2005 Member introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION RESCINDING THE DETERMINATION TO ACQUIRE REAL PROPERTY BY EMINENT DOMAIN IN RESOLUTION NO. 2004 -18 BROOKDALE FORD WHEREAS, the Economic Development Authority in and for the City of Brooklyn Center, Minnesota "EDA is a body corporate and politic organized and existing under the laws of the State of Minnesota, and has the power to engage in development and redevelopment activities pursuant to Minn. Stat. §469.090 §469.018 and related statutes; and WHEREAS, on December 13, 2004, the EDA adopted Resolution No. 2004 -18, a Resolution Authorizing the Acquisition of Real Property for Redevelopment of Opportunity Site, Phase I (Brookdale Ford Site)(the "Resolution'); and also Resolution No. 2004 -19, authorizing acquisition of Brookdale Square; and WHEREAS, in the Resolution, the EDA determined that it was in the public interest and necessary for purposes of proceeding with the proposed redevelopment of the Opportunity Site, Phase 1, for the EDA to acquire through negotiation with the property owner or by eminent domain the Real Property described therein; and WHEREAS, since the adoption of the Resolution, the EDA staff and legal counsel have met and communicated with the owner of the Real Property and its legal counsel; have attempted in good faith to negotiate a purchase of the Real Property; and have reported to the EDA that the parties are far apart in negotiating a voluntary purchase of the Real Property; and WHEREAS, in consideration of the events which have transpired over the course of the last year, which include the opposition of the owner of the Real Property to the acquisition of its property by eminent domain; in order to provide greater certainty to the owner of the Real Property and for all its customers; and for all of the reasons set forth in the Staff Memorandum; the staff has recommended to the EDA that it is appropriate to rescind that part of the Resolution which authorizes the acquisition of the Real Property by eminent domain; and NOW, THEREFORE, be it resolved by the Economic Development Authority in and for the City of Brooklyn Center, Minnesota, in view of the foregoing which are hereby adopted as findings of fact, the EDA hereby resolves as follows: 1. The EDA hereby rescinds that part of the Resolution which authorized the EDA to acquire the Real Property by eminent domain and that part of the Resolution which authorized and directed its legal counsel to acquire the Real Property pursuant to Minn. Stat. 117.042. 2. The EDA hereby states that it is the sense of its Board of Commissioners that the EDA has no intention of using its power of eminent domain to acquire the Real Property in the foreseeable future. December 12. 2005 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. Member introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION RESCINDING THE DETERMINATION TO ACQUIRE REAL PROPERTY BY EMINENT DOMAIN IN RESOLUTION NO. 2004 -19 BROOKDALE SQUARE WHEREAS, the Brooklyn Center Economic Development Authority "EDA a body corporate and politic organized and existing under the laws of State of Minnesota, has the power to engage in development and redevelopment activities pursuant to Minn. Stat. §469.090 §469.018 and related statutes; and WHEREAS, on December 13, 2004, the EDA adopted Resolution No. 2004 -19, a Resolution Authorizing the Acquisition of Real Property for Redevelopment of Opportunity Site, Phase I (Brookdale Square) (the "Resolution and also Resolution No. 2004 -18, authorizing acquisition of the Brookdale Ford site; and WHEREAS, in the Resolution, the EDA determined that it was in the public interest and necessary for purposes of proceeding with the proposed redevelopment of the Opportunity Site, Phase 1, for the EDA to acquire through negotiation with the property owner or by eminent domain the Real Property described therein; and WHEREAS, since the adoption of the Resolution, the EDA staff and legal counsel have met and communicated with the owner of the Real Property and its legal counsel; have attempted in good faith to negotiate a purchase of the Real Property; and have reported to the EDA that the parties are far apart in negotiating a voluntary purchase of the Real Property; and WHEREAS, in consideration of the events which have transpired over the course of the last year; the opposition of the owner of Brookdale Ford to the acquisition of its property by eminent domain; in order to provide greater certainty to the owner of the Real Property and for all its customers; and for all of the reasons set forth in the Staff Memorandum; the staff has recommended to the EDA that it is appropriate to rescind that part of the Resolution which authorizes the acquisition of the Real Property by eminent domain; and NOW, THEREFORE, be it resolved by the Economic Development Authority in and for the City of Brooklyn Center, Minnesota, in view of the foregoing which are hereby adopted as findings of fact, the EDA hereby resolves as follows: 1. The EDA hereby rescinds that part of the Resolution which authorized the EDA to acquire the Real Property by eminent domain and that part of the Resolution which authorized and directed its legal counsel to acquire the Real Property pursuant to Minn. Stat. 117.042. 2. The EDA hereby states that it is the sense of its Board of Commissioners that the EDA has no intention of using its power of eminent domain to acquire the Real Property in the foreseeable future. December 12. 2005 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.