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HomeMy WebLinkAbout2004 12-13 CCM Work Session MINUTES OF THE PROCEEDINGS OF THE CITY COUNCIL OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND THE STATE OF MINNESOTA CITY COUNCIL WORK SESSION DECEMBER 13, 2004 CITY HALL - COUNCIL CHAMBERS CALL TO ORDER The Brooklyn Center City Council met in Work Session and was called to order by Mayor Myrna Kragness at 8:50 p.m. ROLL CALL Mayor Myrna Kragness, Councilmembers Kathleen Carmody, Kay Lasman, Diane Niesen, and Bob Peppe. Also present: City Manager Michael McCauley, Assistant City Manager/Director of Operations Curt Boganey, Community Development Director Brad Hoffman, and Deputy City Clerk Maria Rosenbaum. PROPOSED SENIOR HOUSING DEVELOPMENT AND DISCUSSION ON DIRECTION TO STAFF ON NEGOTIATING A DEVELOPMENT AGREEMENT City Manager Michael McCauley discussed that staff has continued discussions for potential development of an affordable housing development and that this would be an opportunity to update and receive direction from the EDA if they would like to pursue this proposed senior housing development. Developer Frank Dunbar outlined the proposal that they contemplate for the project of independent senior rental properties in Brooklyn Center. Mr. Dunbar outlined some of the project with details that included the proposed project calls for 60 units with underground parking. The average resident will be independent 74 year olds with typically no health problems or needs with approximately 70 percent single females and 30 percent couples. Mr. Dunbar discussed that when they first started discussions with the City they had determined these properties would be owned and operated by the VOA. The Economic Development Authority (EDA) would acquire the properties and enter into a long -term lease for $1 annually with the VOA. At the end of the lease, the EDA would transfer ownership to the VOA. In addition the EDA would provide up to 90 percent of the Tax Increment Financing (TIF) generated from the project on a pay as you go basis as well as authorize the issuance of tax - exempt housing revenue bonds or conduit bonds all in order to make this development affordable and attractive to the target group. However, since they first started discussions, they have been exploring a concept of Hennepin County Housing and Redevelopment Authority (HRA) building and owning the units using their financing capabilities. 12/13/04 -1- Hennepin County HRA ownership would reduce rents because of lower interest costs that could be achieved using County issued bonds. The land itself would belong to the VOA subject to terms and conditions established by the EDA and would be filed with the title. Paul Steinman of Springsted outlined the Hennepin County HRA Financing /Ownership and the VOA's "Conduit" Bonds Issued by the EDA along with the TIF base taxes versus an estimated Pilot (Payment in Lien of Taxes) by Entity. Councilmember Peppe inquired what the projected time frame would be for the project. Mr. Dunbar discussed that he believes 18 months for full occupancy and that if they move forward in April of 2005, the project could be completed in April 2006. Councilmember Lasman asked for clarification on the financing. Mr. Dunbar discussed the differences between the two and informed that they would like to be able to have Hennepin County HRA involved with the financing because of the complexity of financing. She inquired if the residents would need to qualify and if the rents would be considered affordable. Mr. McCauley responded that the residents would have to qualify and that if the project were to move forward with the Hennepin County HRA the project would achieve full occupancy at a faster rate. Community Development Director Brad Hoffman discussed that all rents would be affordable. Councilmember Niesen inquired how Hennepin County HRA became involved. Mr. Hoffman discussed that he and Mr. Dunbar had contacted them asking for direction regarding financing. Chuck Valentine, Hennepin County HRA Director, discussed that his department administers grants and that there could possibly be $4 Million available for affordable housing. Councilmember Niesen asked if the Housing Commission had been involved with these discussions. Housing Commission Chair Mark Yelich discussed that the Housing Commission had been looking at senior housing for the past year and that they are finishing a complete study to be brought to the EDA. Mr. Yelich asked if the EDA would consider posting their decision until they had heard the report from the Housing Commission since the Housing Commission would like to have some questions answered by the EDA Secretary, Brad Hoffman. The Council consensus was no, that the Commission should finish its work by December 21, 2004, so that works could go forward. Councilmember Carmody expressed that she believes the City needs this project and that it accomplishes what can be done with the property being considered. Councilmember Niesen expressed that she believes the EDA should wait to make any decisions on moving forward until they have heard from the Housing Commission. Mayor Kragness asked Mr. Valentine when the monies would be available from the Hennepin County HRA. Mr. Valentine discussed that there is a special meeting this week; however, the topic of grant monies available for affordable housing was not on that special meeting agenda. He believes that the Hennepin County HRA would be discussing the issue in a month. 12/13/04 -2- Mr. Hoffman discussed that the question this evening would be if the EDA would be interested in this project and would like staff to continue seeking an interest to move forward. The EDA would still hear the report from the Housing Commission. Mr. McCauley added that staff does not want to have the Hennepin County HRA bring this issue to their board if the City is not interested. Councilmember Niesen informed that she would argue against moving forward and would not support this project at this time due to the fact that this would be lowering the tax rate. Mayor Kragness and Councilmembers Carmody, Lasman, and Peppe were in favor of moving forward. Councilmember Niesen was against. MISCELLANEOUS Council discussed the Local Board of Training coming in February 2005. Councilmembers Carmody and Niesen informed that they would be attending. ADJOURNMENT A motion by Councilmember Lasman, seconded by Councilmember Niesen to adjourn the Work Session at 9:57 p.m. Motion passed unanimously. City Clerk Mayor 12/13/04 -3-