Loading...
HomeMy WebLinkAbout1998 01-12 EDAP Regular Session EDA MEETING City of Brooklyn Center • January 12, 1998 AGENDA 1. Call to Order 2. Roll Call 3. Approval of Agenda -The following items are considered to be routine by the Economic Development Authority 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. December 15, 1997 - Regular Session b. Resolution Designating Depositories of EDA Funds • 4. Commission Consideration Items a. Resolution Amending Contract for Acquisition and Relocation Services for the 53rd Avenue Development and Linkage Project - Requested Commission Action: - Motion to adopt resolution. b. Resolution Electing Officers for the Economic Development Authority in and for the City of Brooklyn Center - Requested Commission Action: - Motion to adopt resolution. C. Blended Home Loan Program - Requested Commission Action: -EDA discuss. 5. Adjournment • UHAFT 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 DECEMBER 15, 1997 CITY HALL CALL TO ORDER The Brooklyn Center Economic Development Authority (EDA) met in regular session and was called to order by President Myrna Kragness at 7:05 p.m. ROLL CALL President Myrna Kragness, Commission members Kathleen Carmody, Debra Hilstrom, Kay Lasman, and Robert Peppe. Also present: Executive Director Michael J. McCauley, Assistant City Manager Jane Chambers, City Attorney Charlie LeFevere, Public Works Director Diane • Spector, Finance Director Charlie Hansen, and Council Secretary LeAnn Larson. APPROVAL OF AGENDA AND CONSENT AGENDA A motion by Commission member Hilstrom and seconded by Commission member Carmody to approve the agenda and consent agenda as printed passed unanimously. APPROVAL OF MINUTES A motion by Commission member Hilstrom and seconded by Commission member Carmody to approve the minutes of the November 24, 1997 -- Regular Session passed unanimously. COMMISSION CONSIDERATION ITEMS RESOLUTION AUTHORIZING ACQUISITION OF CERTAIN REAL PROPERTY WITHIN THE CITY OF BROOKLYN CENTER LOCATED AT 6945 JUNE AVENUE NORTH AND AUTHORIZING EXECUT OF PUR CHASE AGREEMENT AND PAYMENT FOR ACQUISITION COSTS OF SAID PROPERTY City Manager McCauley explained that the City had received a written offer from the owners of 6945 June Avenue North to sell their home to the City for the assessed value of $75,900. The acquisition of this home would be necessary for any redevelopment of the northeast corner • of 69th Avenue North and Brooklyn Boulevard. 12/15/97 -1- URAFT Councilmember Hilstrom asked about the status of the redevelopment project and requested .that the Council revisit this issue in January 1998. Councilmember Peppe inquired if more properties need to be acquired to do this redevelopment project. City Manager McCauley responded affirmatively. City Manager McCauley stated a report on the redevelopment project for 69th Avenue North and Brooklyn Boulevard would be brought back to Council the last meeting in January 1998. RESOLUTION NO. 97 -31 Member Lasman introduced the following resolution and moved its adoption: RESOLUTION AUTHORIZING ACQUISITION OF CERTAIN REAL PROPERTY WITHIN THE CITY OF BROOKLYN CENTER LOCATED AT 6945 JUNE AVENUE NORTH AND AUTHORIZING EXECUTION OF PURCHASE AGREEMENT AND PAYMENT FOR ACQUISITION COSTS OF SAID PROPERTY The motion for the adoption of the foregoing resolution was duly seconded by member Carmody and passed unanimously. RESOLUTION ACC EPTING THE QUOTATION FOR ELECTRICAL SERVICE FROM WEBER ELECTRIC AT THE EARLE BROWN HERITAGE CENTER FOR TIME AND MATERIALS NOT TO EXCEED $9100 City Manager McCauley explained that the Earle Brown Heritage Center has been experiencing ground water problems due to the heavy snow melt and rains of last spring and early summer. The water is seeping into the basement and affecting the meeting rooms, storage areas, hallway, and electrical room. A temporary construction dewatering system was put in place in an attempt to draw down the water level. This has proven to be an expensive solution and exceeds the cost of a permanent solution. SEH reviewed the problem and made recommendations for a permanent solution, addition of four wells. Councilmember Hilstrom explained she has concerns with this item and sees it as another piece -meal solution. She would like to take a look at this type of issue in the big picture, including the roof replacement of the other barn. She said she would be voting NO on this item. RESOLUTION NO. 97-32 Member Carmody introduced the following resolution and moved its adoption: • 12/15/97 -2- DRAF1 • RESOLUTION ACCEPTING THE QUOTATION FOR ELECTRICAL SERVICE FROM WEBER ELECTRIC AT THE EARLE BROWN HERITAGE CENTER FOR TIME AND MATERIALS NOT TO EXCEED $9,100 The motion for the adoption of the foregoing resolution was duly seconded by member Lasman and passed on a vote of Commission members Carmody, Lasman, Peppe and Mayor Kragness voting aye; Commission member Hilstrom voted nay. RESOLUTION ACCEPTING THE WELL DRILLING OUOTATION IN THE AMOUNT OF $23.793 FROM T ALBERG DRILLING CO MPANY AT THE EARLE BROWN HERITAGE CENTER RESOLUTION NO. 97 -33 Member Carmody introduced the following resolution and moved its adoption: RESOLUTION ACCEPTING THE WELL DRILLING QUOTATION IN THE AMOUNT OF $23,793 FROM THE ALBERG DRILLING COMPANY AT THE EARLE BROWN HERITAGE CENTER • The motion for the adoption of the foregoing resolution was duly seconded by member Lasman and passed on a vote of Commission members Carmody, Lasman, Peppe and Mayor Kragness voting aye; Commission member Hilstrom voted nay. RESOLUTION APPROVING THE FINAL BROOKLYN CENTER ECONOMIC DEVELOPMENT AUTHORITY BUDGET FOR THE YEAR 1998 PURSUANT TO MSA CHAPTER 469.107. SUBDIVISION 1 RESOLUTION NO. 97 -34 Member Carmody introduced the following resolution and moved its adoption: RESOLUTION APPROVING THE FINAL BROOKLYN CENTER ECONOMIC DEVELOPMENT AUTHORITY BUDGET FOR THE YEAR 1998 PURSUANT TO MSA CHAPTER 469.107, SUBDIVISION 1 The motion for the adoption of the foregoing resolution was duly seconded by member Peppe and passed unanimously. RESOLUTION RE QUESTING THE CITY OF B ROOKLYN CENTER TO LEVY TAXES FOR THE BENEFIT OF THE BROOKLYN CENTER ECONOMIC DEVELOPMENT AUTHORITY FOR THE YEAR 1998 12/15/97 -3- DRAFT RESOLUTION NO. 97 -35 Member Carmody introduced the following resolution and moved its adoption: RESOLUTION REQUESTING THE CITY OF BROOKLYN CENTER TO LEVY TAXES FOR THE BENEFIT OF THE BROOKLYN CENTER ECONOMIC DEVELOPMENT AUTHORITY FOR THE YEAR 1998 The motion for the adoption of the foregoing resolution was duly seconded by member Hilstrom and passed unanimously. ADJOURNMENT A motion by Commission member Lasman and seconded by Commission member Carmody to adjourn the meeting at 7:20 p.m. passed unanimously. City Clerk Mayor • Recorded and transcribed by: LeAnn Larson 12/15/97 -4- 3b MEMORANDUM • TO: Michael J. McCauley, City Manager Y Y g FROM: Charlie Hansen, Finance Director G H DATE: January 5, 1998 SUBJECT: Resolution Designating Depositories of EDA Funds In January of each year, the Commission has passed a resolution designating the banks which are authorized as depositories of EDA funds. Marquette Bank Brookdale is where the EDA has its checking account. Paymentech Inc. is a clearinghouse depository for credit card sales at the Earle Brown Heritage Center. Surplus EDA funds are pooled with City funds and invested through the institutions listed on the City Resolution designating depositories. I • Commissioner introduced the following resolution and moved its adoption: is EDA RESOLUTION NO. RESOLUTION DESIG DEPOSITORI OF EDA FUNDS WHEREAS, the Economic Development Authority Commission has authority over EDA funds, including the safekeeping and disbursement of public moneys, and WHEREAS, Section 7.10 of the City Charter provides that City funds shall be disbursed by check bearing the actual or facsimile signature of the city manage and city treasurer. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of Brooklyn Center, Minnesota, as follows: 1. that Marquette Bank Brookdale is hereby designated as the depository of funds of the Economic Development Authority. 2. that the EDA assistant treasurer is authorized to deposit EDA funds to the extent that repayment is guaranteed by the Federal Deposit Insurance Corporation and such additional funds not to exceed the amount of 90% of collateral pledged by the depository to the EDA. • 3. that the EDA assistant treasurer is authorized to deposit surplus EDA funds into the City's pooled investment account and invest them according to the policy and restrictions pertaining to that account. 4. that Paymentech, Inc. is hereby designated as the clearinghouse depository for credit card sales of the Earle Brown Heritage Center. 5. that the city manager and city treasurer are authorized by the EDA Commission to act for the EDA in any of its business with the depositories. 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. • � To: Michael J. McCauley, City Manager • From: Tom Bublitz, Community Development Specialiy MEMORANDUM Subject: Request from Evergreen Land Services for additional compensation for services rendered in the 53rd Avenue Development and Linkage project. Date: January 6, 1998 The Brooklyn Center EDA entered into a contract with Evergreen Land Services for residential acquisition and relocation services in the 53rd Avenue Development and Linkage Project for a cost not to exceed $36,970. This included the acquisition and relocation of twenty -five residential properties. To date $35,382.01 has been paid to Evergreen Land Services under this contract. Evergreen Land Services has indicated to me that their actual cost for providing acquisition and relocation services for the 53rd Avenue Development and Linkage Project will reach $47,000 or $10,030 over the not to exceed amount of $36,970. Evergreen Land Services attributes the additional costs to the following: g I Unusually difficult and time consuming negotiations for both acquisition and relocation services provided to a number of property owners and renters in the 53rd Avenue Development and Linkage Project, and additional meetings with City staffthat • were not anticipated in the initial proposal. Evergreen Land Services requested a l0% increase over the initial $36,970 to cover these costs. 2 Compensation for a relocation claim for 810 53rd Avenue North which was the fire damaged vacant property that did require Evergreen Land Services to do a claim for moving expenses. 3 Com ens p anon for completing three business relocation claims not anticipated in the original proposal. These three business claims, one for a carpet cleaning business, one for a stationery printing business and one for a rental realty business for one of the four- plexes, were not known at the time the RFP was developed and City staff and Evergreen Land Services became aware of these businesses only after the project started. After reviewing the request from Evergreen Land Services for additional compensation under the contract, and discussing the additional cost with Evergreen Land Services I would recommend the following: • Deny the request for an additional 10% over the $36,970 to cover the unusually difficult acquisition and relocation negotiations. While I agree with Evergreen Land Services that many of the acquisitions and relocations were much more difficult • than expected, this would not justify increasing the not to exceed quote. ■ Deny the request for $700 for relocation services associated with the fire damaged and vacant property at 810 53rd Avenue North since this property was included in the initial RFP. • 1 would recommend approval of compensating Evergreen Land Services for the three business relocation claims they completed as part of the 53rd Avenue Development and Linkage Project. These business relocation claims were not included in the original RFP since they were not anticipated and not known until the project was under way. The dollar amount for these three claims is $3,500. In summary, Evergreen Land Services request and staff recommendations are as follows: • Evergreen Land Services has indicated their total project cost associated with the 53rd Avenue Development and Linkage Project will be $47,000 and they have requested the $36,970 contract amount be increased to $45,000. • Staff is recommending the contract amount of $36,970 be increased by $3,500 to address three unanticipated business relocation claims completed by Evergreen Land Services as part of the 53rd Avenue Development and Linkage Project. Total compensation to be paid to Evergreen Land Services for the 53rd Avenue Development and Linkage Project would be $40,470. Evergreen Land Services Company has indicated they would be satisfied with this amount as total payment. • A resolution amending the contract for acquisition and relocation services, with Evergreen Land Service Company, to reflect the additional expenses for the three business relocation claims is included with this memorandum. • • its adoption: Commissioner introduced the following resolution and moved EDA RESOLUTION NO. RESOLUTION AMENDING CONTRACT FOR ACQUISITION AND RELOCATION SERVICES FOR THE 53RD AVENUE DEVELOPMENT AND LINKAGE PROJECT WHEREAS, EDA Resolution 96 -30 accepted the proposal of Evergreen Land Services Company to provide acquisition and relocation services for the 53rd Avenue Development and Linkage project; and WHEREAS, Evergreen Land Services Companies proposal provided residential acquisition and relocation services for twenty -five (25) residential properties for a price not to exceed $36,970; and WHEREAS, Evergreen Land Services Company provided relocation services for three businesses, operated by property owners in the 53rd Avenue Development and Linkage Project; and WHEREAS, the business relocations were not included in the original request for proposal and subsequent contract for acquisition and relocation services for the 53rd Avenue Development and Linkage Project; and WHEREAS, the additional costs for Evergreen Land Services to prepare three business relocation claims is $3,500 NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City of Brooklyn Center as follows: 1. The contract with Evergreen Land Services Company for acquisition and relocation services for the 53rd Avenue Development and Linkage Project is hereby amended to provide for the three business relocation claims in the amount of $3,500. 2. Any outstanding acquisition and relocation services included in the original contract shall be completed by Evergreen Land Services Company for the $36,970 not to exceed contract price. 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. • �y • Commissioner introduced the following resolution and moved its adoption: EDA RESOLUTION NO. RESOLUTION ELECTING OFFICERS FOR THE ECONOMIC DEVELOPMENT AUTHORITY IN AND FOR THE CITY OF BROOKLYN CENTER WHEREAS, Minnesota Statutes Section 469.096 provides that an economic development authority shall elect a president, treasurer, and secretary on an annual basis. NOW, THEREFORE, BE IT RESOLVED by the Economic Development Authority in and for the City Council of the City of Brooklyn Center, Minnesota, that the Authority hereby elects the following officers to serve through December 31, 1998, or such later date as their successors are elected and qualified: President/Treasurer: Myrna Kragness Vice - President: Kay Lasman Assistant Treasurer: Charlie Hansen Secretary: G. Brad Hoffman Date President The motion for the adoption of p the foregoing resolution was duly seconded b commissioner g Y Y 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. • Memorandum To: Michael McCauley From: Brad Hoffman, Community Development Director Date: November 19, 1997 ��tg Re: Blended Home Loan Program The council has requested information on the possibility of using our current deferred loan money (CDBG) to write down interest rates for home rehabilitation loans. The intent was to create a simple financial incentive for homeowners to reinvest in their homes. Attached you will find Hennepin County's response to the idea. Keep in mind that anytime federal funds (CDBG) are used all federal block grant regulations must be adhered to. Such regulations include but are not limited to: income eligibility requirements, priorities as to eligible expenditures, competitive bidding as well as numerous others. Under the ro as proposed, Hennepin County would administer a P P P � P ty program blending Brooklyn Center's deferred loan program with the Minnesota Housing Finance Agency's "Fix Up Fund". The deferred loan would continue as is with no interest. A lien is placed on the property for 30 years or until the property is sold whichever is sooner. At that time the deferred loan is repaid. The deferred loan would make up 40 percent of the blend of the two programs with a minimum total loan of $12,500 (MHFA— $7,500, CDBG — $5,000). As an example a homeowner who o has otherwise qualified would borrow $15,000 to undertake the eligible activities they wish to do. The homeowner has a household income of $32,000 and will borrow the money at a fifteen (15) year term at 8 percent. The monthly payment would be $86.01 for an effective interest rate of 4/10 of a percent. While the interest rate is significantly reduced, it is coupled with CDBG's cumbersome regulations. Also, if Brooklyn Center held back approximately $8,000 to deal with emergency grants and our administrative cost was $7,200 in reality we would have only $44,800 available. Brooklyn Center would be, in theory, able to do four (4) to nine (9) loans per year. Our actual experiences would probably be six (6) or seven (7) per year. Currently, Brooklyn Center does three (3) to five (5) deferred loans per year. Given the federal regulations of the CDBG program, our deferred loan money does not easily lend itself to a home loan program. What home loan exists where the owner must get competitive quotes and work with the lowest quote and complete a federal priority list of home improvements before the owner addresses the improvements they desire? Such requirements I believe would prove to be more of a disincentive to the homeowner. The GMMC proposal would assist homeowners locate financing, develop rehab plans and specification, get quotes and enter into contracts. I believe this approach will be a more effective way to encourage and assist home renovations. Hennepin County An Equal Opportunity Employer November 20, 1997 Mr. Brad Hoffman Community Development Director City of Brooklyn Center 6301 Shingle Creek Parkway Brooklyn Center, MN 55430 Dear Brad: Subject: CDBG Funded Single - Family Housing Rehabilitation Program Several weeks ago, we met to discuss ways that Brooklyn Center could restructure their single- family housing rehabilitation programs. This letter is a follow -up to that discussion. Brooklyn Center participates in the Urban Hennepin County Community Development • Block Grant (CDBG) program and allocates, each year, funds for housing rehabilitation loans. Hennepin County administers the Brooklyn Center CDBG housing rehabilitation loan program and additional loan programs provided through the Minnesota Housing Finance Agency (MHFA). Brooklyn Center currently has 45 families on the waiting list for the CDBG loan program. A CDBG allocation of $60,000 would provide approximately 5 to 6 deferred loans for low - income families. The loans are secured by a thirty -year lien against the property and repaid at the point of sale. Most families served under the existing CDBG - funded program are very low - income and do not have the ability to make principal and interest payments. Voule the CDBG loan program provides direct assistance to families, it also assists in maintaining the city's housing stock. The MHFA- funded deferred loan program is a $250,000 allocation for all of suburban Hennepin County. Funding for this two -year program was committed in three months. MHFA Fig -Up Fund Hennepin County is a participating lender under the MHFA Fix -Up Fund. In addition, the Southeast Area Neighborhood of Brooklyn Center has been designated eligible for MHFA Community Fix -Up Funds. Office Of Planning & Development • Development Planning Unit Recycled Paper 10709 Wayzata Boulevard, Suite 260 :Minnetonka, Minnesota 55305 (612) 541 -7080 FAX(612) 541 -7090 TDDrM:(612) 541 -7981 Mr. Brad Hoffman Page 2 Both programs provide below- market rehabilitation loans for income eligible families. Following is an overview of the program guidelines: MHFA HOME IMPROVEMENT LOAN PROGRAMS Community Fix -Up Fund Fix -up Fund Maximum Loan $15,000 ( $25,000 Maximum HH Income $46,000 ( $65,895 Interest Rate Under $10,000 2% 2% $10,001 420,000 4% 4% $20,001 430,000 6% 6% $30 8% 8% Blending CDBG and MHFA Funds MHFA: The MICA Fix -Up Fund is available from local lenders and through the Hennepin County HRA. The program operates very similar to regular bank loans. Homeowners make an application and are approved based upon their income and credit history. A payment for the entire loan amount is given to the family to use for the proposed improvements. MHFA randomly audits a small percentage of the loans. No property inspections are required under this program. The homeowner decides what improvements are made and they may pay for value -added improvements. CDBG: The CDBG program requires property inspections prior to starting the work and an inspection following completion of the work. The types of improvements eligible for CDBG - funded improvements are much more restrictive, basically deferred maintenance improvements. Under the CDBG program, the administering agency determines which improvements are eligible for loan funds. Blended Fund.• CDBG funding could be used to write -down the MHFA Fix -Up Fund or Community Fix -Up Mr. Brad Hoffman • Page 3 Fund. I recommend, under a blended program, that CDBG funds be in the form of a zero - interest deferred loan. MHFA staff is currently reviewing options on how local agencies can provide write -downs to Fix -Up Fund loans. If Brooklyn Center elected to blend CDBG and MHFA funds, the following program administrative issues would need to be addressed: 1. Properties must be inspected, a scope of work prepared, and a final inspection conducted. 2. Administering agency would prioritize which improvements are funded. 3. Property owners would be required to obtain a minimum of two bids for work to establish cost reasonableness. 4. Loans should be written -down at a flat rate, such as 40% of the total loan amount. CDBG would be a deferred loan and the remainder MHFA funds. A minimum loan amount must be established. It would not be cost effective to operate a CDBG write -down for less than $5,000 per loan. 5. Hennepin County would continue to charge a 12% administrative fee for the CDBG rehabilitation program. 6. An emergency fund should be established for such things as furnaces, water heaters and sewer lines. Families in emergency situations may not be eligible for Fix -Up Fund loans. • Hennepin County recognizes the need to maximize existing resources for single - family rehabilitation; this is why the county has agreed to administer the M IIFA Home Improvement loan programs in suburban Hennepin County. It may be more beneficial for the city to utilize a more flexible funding source other than CDBG for writing -down Fix -Up Fund loan interest rates. We will work with you to access state funding sources to the greatest extent feasible in addressing Brooklyn Center single - family housing rehabilitation needs. I believe that CDBG deferred loans fill a need for very low - income families that otherwise would not make necessary repairs on their homes. Please let me know if you have any questions. We will need to work on administrative details once a funding decision has been made. I will contact you after you have had the opportunity to discuss funding options with the city council. Sincerely, Barbara Hayde Administrative Manager cc: Tom Bublitz Jim Graham •