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HomeMy WebLinkAbout2012 10-08 CCM Work Session MINUTES OF THE PROCEEDINGS OF THE CITY COUNCIL/ECONOMIC DEVELOPMENT AUTHORITY OF THE CITY OF BROOKLYN CENTER IN THE COUNTY OF HENNEPIN AND i THE STATE OF MINNESOTA W SESSION WORK S S OCTOBER 8, 2012 CITY HALL—COUNCIL CHAMBERS CALL TO ORDER The Brooklyn Center City Council/Economic Development Authority (EDA) met in Work Session called to order by Mayor/President Tim Willson at 8:30 p.m. ROLL CALL Mayor/President Tim Willson and Councilmembers/Commissioners Carol Kleven, Kay Lasman, Lin Myszkowski, and Dan Ryan. Also present were City Manager Curt Boganey, Director of Business and Development Gary Eitel, Assistant City Manager/Director of Building & Community Standards Vickie Schleuning, City Attorney Charlie LeFevere, and Carla Wirth, TimeSaver Off Site Secretarial, Inc. DIRECTION REGARDING OFFER TO PURCHASE 5331 MORGAN AVENUE N. (TAX FORFEITED PROPERTY)—CONTINUED Councilmember/Commissioner Ryan asked how the City is able to structure an agreement to preserve development rights and require the properties to be combined. City Attorney Charlie LeFevere stated it would be structured to require the two parcels to be combined by an informal lot combination for tax purposes. Once that is completed,the property cannot be divided without City approval. He stated a mortgage security or interest declaration can be drafted that is recorded with Hennepin County to assure if the property is ever divided and sold, the City can recover its costs. Mr. LeFevere stated if the City Council/EDA decides to proceed, staff will assure the documentation addresses those concerns. Councilmember/Commissioner Lasman stated a benefit of approval is that the property would be occupied, but the City is already allowing a car to be parked in the driveway to give that appearance. She stated support for the City Council/EDA to recover the costs incurred and asked what would be the benefit if the property was not sold. City Manager Curt Boganey indicated that in the absence of this arrangement, chances are the property would remain vacant and the City would have to maintain it until it can be sold to another buyer. He noted this lot is large enough that the sale may happen in the future. Another option is to divide this lot between the property owners to the north and south to provide additional yard to both. However, the property to the north is already under foreclosure so that option may not be viable. Mr. Boganey stated if the current offer is the best option, the next question is what is the best price. He explained the EDA's cost to acquire and demolish may not 10/08/12 -1- be the best way to decide the purchase price. The fair market value to the buyer may be a consideration instead of how much the EDA invested into the property. Mr. Boganey agreed the City does not want to sell the property at a substantial discount and then have the owner receive a windfall profit. He suggested the value of having a larger lot be determined and how to preclude the ability to divide it in the future for a windfall profit. Councilmember/Commissioner Lasman stated she thinks the amount invested should be a factor along with the fair market value, but there should also be some liability if the purchaser is allowed to use the garage and then does not end up purchasing the property. Mr. Eitel stated this property was appraised by the County at $17,000 assuming the house was removed. He estimated fair market value in the range of$30,000-38,000. Mayor/President Willson asked if the current garage would be removed, noting otherwise the lot would contain three buildings. Mr. Eitel stated the three existing buildings includes a child's playhouse and it is staff s understanding that a play structure is not considered an accessory structure. Mr. Eitel explained Mr. Sikora has indicated he wants to expand his existing house (currently 760 sq. ft. on the main level) so the house is salable in the future but is not interested in sacrificing his daughter's play structure. Mr. Eitel asked how the EDA would like to address this type of lot and create infill development. He stated if the EDA does not support the sale of this lot, staff would still recommend the house and garage be removed. Ma or/President Willson asked about the property to the north of the subject site. Mr. Eitel Y p p Y J stated it is a wider lot and under foreclosure. Councilmember/Commissioner Lasman stated the City has acquired a lot of properties that it maintains in the neighborhood stabilization process that are awaiting redevelopment. She asked about the probability of this moving in a positive direction to expand the home and maximize the property. for sale. Ma or/President Willson stated another option is for the City to subdivide the property Y P Y Mr. Eitel stated there may be interest in that option since Mr. Sikora's motivation is to have enough property to build a home addition. He stated if the City Council/EDA is not comfortable with a deferred payment option, Mr. Sikora may not be in a position to purchase this property. Councilmember/Commissioner Ryan stated the possible benefit of selling and recouping a reasonable amount of the City's costs is that this property owner will be in a position to improve his property with a house addition, which will be of benefit to this property and the rest of the neighborhood. Councilmember/Commissioner Ryan observed that the blocks in this neighborhood have turn-of-the-Century home styles that are small and substandard in features and maintenance. He felt providing incentive to improve one of those properties would be of benefit to the neighborhood and may spur other property improvements. 10/08/12 -2- Councilmember/Commissioner Myszkowski stated she is drawn to this area of Brooklyn Center and wonders what it was like to have lived in this area when it was thriving, noting it has a lot of charm. She stated she is conflicted with this item and concerned with a deferred payment, administrative costs, and establishing an adverse precedent. However, she likes the idea of someone being so tied to this area that they are willing to come forward with this proposal. Mayor/President Willson stated he would only consider this below value offer if staff is able to draft an ironclad agreement for a future payment should the landowner split the property for resale. He noted if the landowner does not divide the property, the City may not see that future payment. Mr. LeFevere stated in general, the public body holds all property in trust for the public and cannot dispose improvidently. The City operates by selling for fair market value but can take into consideration other public purposes served by the purchase. That may include a buyer guaranteeing to construct a certain type of house to improve the property. Mr. LeFevere noted the HRA/EDA is given power to do projects that create other public benefits so it may sell property for$1 if the City is getting a benefit sufficient to justify that cost mark down. However, in those cases, conditions have to be imposed to assure the benefit is received. Mr. LeFevere stated if the City Council/EDA thinks there will be sufficient benefit to the neighborhood from this house addition, that it would increase tax base and enhance the neighborhood, then it could be required as a contract term. He advised it is problematic to accept the offer as submitted and there may be other options such as sale by contract for deed with an adequate down payment. Under a contract for deed, the City would hold the deed until it was fully paid but it would preserve the future option for Mr. Sikora. Mayor/President Willson stated he is not opposed to looking at this offer, but has reservations about using tax dollars to subsidize, the three outbuildings that need to be resolved, and that the City may not receive a future $20,000-30,000 payment. He indicated he understands the argument for an increase to the tax base if a larger home is built and that it enhances the neighborhood; however, it is hard to trade that with what the City Council/EDA will tell constituents when they learn of this deal and ask how they can get the same. Mayor/President Willson stated a contract for deed is an interesting option if it recovers the City's costs. Councilmember/Commissioner Lasman stated Mr. Sikora wants the garage for his immediate use and if buying only that much, it is about one-third of the lot. She asked if the City would remove the house if sold on a contract for deed. Mr. Eitel answered in the affirmative, noting the house is damaged to the point where it is not salvageable. Councilmember/Commissioner Lasman asked whether the house could be demolished, the garage left, and the property sold on a contract for deed. Mr. Boganey stated staff will have to hold that conversation with Mr. Sikora. Councilmember/Commissioner Lasman suggested staff hold additional conversations with Mr. Sikora to get answers to the questions raised. Mr. Eitel advised that under the Zoning Ordinance, the lot is large enough that it could be subdivided for future sale with a portion being sold to Mr. Sikora to join to his property to create 155 feet of frontage. With that option,the City would hold the value of the remaining lot. 10/08/12 -3- Mayor/President Willson stated his concern with considering this type of deal for one constituent, noting others will want the same consideration. Councilmember/Commissioner Kleven concurred and stated she thinks $15,000 is too low. In addition, if Mr. Sikora is unable to come up with the money and make the full purchase, it may be 10-15 years before he expands the house. Mr. Boganey stated there is not consensus to support the offer received and issues have been raised that have to be resolved. He indicated the City can thank Mr. Sikora for the offer but decline it, or the City can negotiate another proposal that addresses the concerns raised tonight. The majority consensus of the City Council/EDA was to decline the purchase offer of Jacie and Maciej Sikora and direct staff to obtain more information on other options including a contract for deed. SIGNAGE IN COMMERCIAL ZONING DISTRICTS Mr. Boganey introduced the item relating to signage issues and concerns identified in the Regal Retail Center that were raised during Open Forum. He referenced staff's report and conclusion there are some legitimate issues that relate to visibility due to existing trees and need for more signage for some of the uses and better marketing tactics for other uses. Mr. Boganey noted the owners proposed having temporary signs on the concrete pad to address problems with visibility and marketability. Staff found that is not the entire problem, or the primary problem. It was noted that staff receives similar requests to create more visibility from small shops in these types of retail centers so it is not restricted to only the Regal Retail Center. Mr. Boganey asked the City Council/EDA whether the current restrictions that limit temporary signs should be modified to give more flexibility and opportunity. Councilmember/Commissioner Myszkowski stated that Brooklyn Park recently considered changing its Sign Ordinance to be more business friendly. She noted a staff report comment indicated retail staff "remained in their relaxed position" even when staff entered the establishment. Councilmember/Commissioner Myszkowski asked whether retail staff was unresponsive because they are geared to a different type of clientele based on culture. She noted the types of flags they displayed may have drawn a certain clientele and asked about the types of businesses that are finding they are unable to draw traffic. Councilmember/Commissioner Myszkowski stated she does not have all of the information to make a decision, but does not support flashing lights. She noted the business owner who had approached the City Council/EDA has very cluttered windows. Councilmember/Commissioner Ryan asked whether a modification to the joint sign could be considered to increase scale. Mr. Eitel advised they could erect another sign on the corner lot. He stated when he looked at the site, he noticed the curvilinear nature of the road and that each business had a sign. However, when looking at the color, size, and lettering, he found some were effective and readable while others were not. Mr. Eitel stated the City can address the treatment of the concrete walkway, which is consistent with all strip centers, for inline tenants. He noted if 10/08/12 -4- a business does not get enough attention from a sandwich sign, they will place a second sandwich sign by the road. However, additional signs are not always effective. Mr. Eitel suggested several creative methods of advertising to the businesses' market and asked how much the City should become involved with business management to assure customers are attracted. Councilmember/Commissioner Lasman commented on the importance of welcoming potential clients when they enter a business establishment because they will talk with others, perhaps generating referrals. She noted that signs will not help that type of situation. Councilmember/Commissioner Lasman noted the City Council/EDA had spent a lot of time over the years to assure the City is attractive, orderly, clean looking, and that signs do not create a junky appearance. She stated she is willing to entertain the option of allowing a "Grand Opening"temporary sign or several specials events per year but if allowed in this instance, it has to be allowed for all businesses in the City so tight parameters would be needed. Councilmember/Commissioner Lasman stated support for the suggestions of Mr. Eitel relating to landscape change and to prune the tree. Councilmember/Commissioner Kleven described her visit to this retail center and entry into one store where she felt she was not welcomed. She stated her preference was attractive window displays that enticed her to enter the store, not windows that are cluttered with signs so you cannot see inside. Councilmember/Commissioner Kleven stated it would be too many signs if each business was allowed one sandwich sign. Mayor/President Willson noted during the Planning Commission consideration of this site plan, it was discussed whether tenants could be attracted to this strip mall given the location of the gas stations. The applicant swore they would not have a problem getting businesses into this retail center. He suggested the tenants.work with their landlord to see what can be done rather than asking the City to change its Sign Ordinance. Mayor/President Willson stated he has worked with the City's Planning Commission and City Council for 25 years and recalled that the Sign Ordinance comes up every several years. He noted that during his tenure, the City has been adamant in its support of the Sign Ordinance and was not willing to open it to billboards and other signs that would detract from the City. Mayor/President Willson stated he still would not support such an Ordinance amendment. Councilmember/Commissioner Ryan supported asking the successful business anchors at each corner if they would be amenable to allowing other businesses to have promotional flyers by their register to draw attention to the other tenants. He agreed it would be a mistake and negatively impact the City's image to allow signs to proliferate but temporary signs may be an option or to lower that$50 fee. Councilmember/Commissioner Myszkowski pointed out another resource for these tenants is the Brooklyn Center Business Association (BCBA). She noted that many small business owners do not have a background in management and may think that drawing customers will come easily to sustain their businesses. Councilmember/Commissioner Myszkowski noted it would be helpful if the BCBA offered a one-time seminar on the top ten techniques for attracting and retaining customers. 10/08/12 -5- Mayor/President Willson stated the City should not pursue working out a business plan or being party to business education because many other resources are available. He also does not want to see the City's businesses suffer an economic hardship or leave but in this case, he does not see an economic hardship. Councilmember/Commissioner Lasman noted this is not a unique situation to only this location. She suggested the City indicate it is concerned but it is the tenant's responsibility to work with their landlord to address issues and take advantage of available resources. She cautioned against promoting one business over another competitive business and suggested staff inform the tenants that the City Council/EDA addressed their issues at a Work Session; however, were not willing to entertain a change to the Sign Ordinance. Councilmember/Commissioner Ryan stated it would not hurt to remind them that the City Council/EDA has a wide range of experience and knows, based on its experience, that proliferation of signs will not help attract customers. Mr. Boganey noted the EDA does a lot to support and facilitate the success of businesses in Brooklyn Center. The consensus of the City Council/EDA was to support Mr. Boganey's suggestion to send the tenants a letter listing available resources of which they could take advantage. ADJOURNMENT Councilmember/Commissioner Lasman moved and Councilmember/Commissioner Ryan seconded adjournment of the City Council/Economic Development Authority Work Session at 9:56 p.m. Motion passed unanimously. 10/08/12 -6- STATE OF MINNESOTA) COUNTY OF HENNEPIN) ss. Certification of Minutes CITY OF BROOKLYN CENTER) The undersigned, being the duly qualified and appointed City Clerk of the City of Brooklyn Center,Minnesota,certifies: 1. That attached hereto is a full, true, and complete transcript of the minutes of a Work Session of the City Council of the City of Brooklyn Center held on October 8, 2012. 2. That said meeting was held pursuant to due call and notice thereof and was duly held at Brooklyn Center City Hall. 3. That the City Council adopted said minutes at its October 22, 2012, Regular Session. City Clerk Mayor 10/08/12 -7-