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HomeMy WebLinkAbout2019 06-24 EDAM REGULAR SESSIONMINUTES 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 JUNE 24, 2019 CITY HALL — COUNCIL CHAMBERS 1. CALL TO ORDER The Brooklyn Center Economic Development Authority (EDA) met in Regular Session called to order by President Mike Elliott at 9:00 p.m. 2. ROLL CALL President Mike Elliott and Commissioners April Graves, Kris Lawrence -Anderson, and Dan Ryan. Commissioner Marquita Butler was absent and excused. Also present were Executive Director Curt Boganey, Community Development Director Meg Beekman, Police Chief Tim Gannon, and City Attorney Troy Gilchrist. 3. APPROVAL OF AGENDA AND CONSENT AGENDA Commissioner Ryan moved, and Commissioner Graves seconded to approve the Agenda and Consent Agenda, and the following item was approved: 3a. APPROVAL OF MINUTES May 28, 2019 — Regular Session Motion passed unanimously. 4. COMMISSION CONSIDERATION ITEMS 4a. RESOLUTION NO. 2019-12 APPROVING A PURCHASE AGREEMENT AND CONVEYANCE OF CERTAIN PROPERTY TO CENTRA HOMES LLC Community Development Director Meg Beekman reviewed a proposed purchase agreement with Centra Homes LLC for development of a 7.5 -acre property owned by the Economic Development Authority (EDA). She added the property was acquired using TIF #3 pooled funds with the intent of redeveloping the land into single-family homes. Ms. Beekman stated Centra Homes was selected to develop a site plan for 30-35 move -up single family homes with an average home price of $332,000. She added the purchase agreement $115,000 stipulates that Centra Homes would pay an earnest amount and conduct due diligence 06/24/19 -1- and obtain financing, closing on the property on or before September 30 for a purchase price of .$115,000. Commissioner Lawrence -Anderson stated residents of that neighborhood have asked about damage to the streets for which they were recently assessed. Ms. Beeman stated a pre -inspection would be conducted, which would document the condition of the streets before work commences. Commissioner Graves requested clarification regarding why the City does not have residential design standards, and whether that is typical for cities. Ms. Beekman stated the City of Brooklyn Center had been fully developed for many years, and landscape and design standards are generally required for new residential developments. She added the City Council could review this issue and consider the addition of residential design and landscaping standards. She noted this type of standard is especially helpful in a city like Brooklyn Center, where there are many mature trees, and tree removal guidelines might be required for redevelopment projects. Commissioner Graves stated she would support consideration of residential design standards as a future work session agenda item. Mr. Boganey stated that it is a topic that could be addressed by the Zoning Task Force. Ms. Beeman agreed. Commissioner Ryan moved, and Commissioner Lawrence -Anderson seconded to open the public hearing at 9:10 p.m. Motion passed unanimously. There were no comments Commissioner Graves moved, and Commissioner Ryan seconded to close the public hearing at 9:11 P.M. Motion passed unanimously. Commissioner Ryan stated he appreciates that residents are concerned about disruption to their neighborhood. He added the contractor and the City would do everything possible to minimize inconvenience. He noted this is a great opportunity for the City to provide move -up homes and bring the undeveloped residential property into more productive use. Commissioner Ryan moved, and Commissioner Lawrence -Anderson seconded to adopt RESOLUTION NO. 2019-12 Approving a Purchase Agreement and Conveyance of Certain Property to Centra Homes LLC. President Elliott abstained. Motion passed. 06/24/19 -2- 4b. CONSIDERATION OF A TERM SHEET BETWEEN REAL ESTATE EQUITIES AND THE ECONOMIC DEVELOPMENT AUTHORITY OF BROOKLYN CENTER REGARDING TAX INCREMENT FINANCING Ms. Beekman reviewed a concept plan proposed by Real Estate Equities for EDA -owned property at 5801 Xerxes Avenue N. A Planned Unit Development (PDA) Agreement was approved by the City Council on June 10, 2019, for a residential community comprised of two buildings with senior living and workforce housing. The project qualifies for a 26 -year TIF housing district, as requested by the applicant. The estimated market value of the property after construction would be $33.3 million and would generate $360,000 annually in property taxes. Ms. Beekman stated City Staff recommends the creation of a 26 -year TIF district of $1.6 million pay as you go, likely to be paid off in 16 years. The EDA would retain 10% of the increment over the life of the note repayment that could be utilized to cover the City's costs and other housing projects. The City can choose to keep the District open for the fu1126 years. Ms. Beekman stated TIF District income limits would apply, which would be 40% of units at 60% AMI. She added this is a statutory requirement for TIF districts. Commissioner Ryan requested confirmation that the TIF note is the obligation of the developer and not the City. Ms. Beekman confirmed this. Commissioner Ryan asked whether the length of the TIF District is a legal requirement. Ms. Beekman confirmed this, adding there is a maximum length specified in State statute. Commissioner Ryan asked whether the TIF district could be applied to other projects. Ms. Beekman stated City Staff is proposing that this TIF district will be applied to this property only, but it can be spent outside the district for eligible development opportunities if the additional increment is produced. Commissioner Lawrence -Anderson asked when the developer will pay their full property tax revenue to the City. Ms. Beekman stated additional taxes besides the base tax that are generated off the development after the project is constructed are paid by the developer. She added they would receive a refund of 90% to pay off the TIF note up to the amount of the note or after 16 years. Commissioner Graves asked what the TIF district this will be, and whether there are a few districts close to ending. Ms. Beekman stated this would be TIF District #8. She added Districts 1 and two are no longer active and were decertified. She noted TIF #3 decertifies in 2021. She noted she could provide additional detail on each of the TIF Districts for the City Council's review. Commissioner Ryan stated the development is dependent upon this modest subsidy. He added these sets aside City revenue over 16 years to provide an asset to the community for seniors and working families. 06/24/19 -3- Commissioner Ryan moved, and Commissioner Lawrence -Anderson seconded to direct City Staff to prepare an agreement consistent with the term sheet. Motion passed unanimously. 5. ADJOURNMENT Commissioner Ryan moved, and Commissioner Graves seconded adjournment of the Economic Development Authority meeting at 9:30 p.m. Motion passed unanimously. 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 Economic Development Session of the City Council of the City of Brooklyn Center held on June 24, 2019. 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 July 8, 2019, Regular Session. &UMASJW4 6 Barbara Suciu, City Clerk 06/24/19 4- Mike Elliott, Mayor