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HomeMy WebLinkAbout09/22/2005 ECONOMIC DEVELOPMENT AUTHORITY City of Apple Valley Dakota County, Minnesota • September 22, 2005 Minutes of the special meeting of the Economic Development Authority of Apple Valley, Dakota County, Minnesota, held September 22, 2005, at 7:30 o'clock a.m., at Apple Valley Municipal Center. PRESENT: President Severson; Commissioners Bergman, Edgeton, Erickson, Goodwin, Grendahl, and Hamann- Roland. ABSENT: None. Staff Members Present: Executive Director Lawell, Secretary Gackstetter, Assistant City Administrator Grawe, Community Development Director Kelley, and City Planner Lovelace. President Severson called the meeting to order at 7:31 a.m. APPROVAL OF AGENDA Mr. Lawell said staff is recommending postponing action on items 4.B and 4.0 under Augustana Home of St. Paul Project, until the meeting of October 13, 2005. • MOTION: of Grendahl, seconded by Hamann - Roland, approving the agenda for today's meeting as amended. Ayes - 7 - Nays - 0. MINUTES MOTION: of Hamann - Roland, seconded by Bergman, approving the minutes of the special meeting of May 12, 2005, as written. Ayes - 7 - Nays - 0. AUGUSTANA HOME OF ST. PAUL PROJECT Ms. Kathy Kopp, Director of Business Development for Augustana Care Corporation, provided background and experience information on the types of adult care facilities they own and operate. They are a non - profit, faith -based organization which has served Minnesotans for 109 years. Housing and services they provide include senior housing, home care services, wellness /rehab services, skilled nursing facilities, adult day programs, and assisted living facilities. Ms. Jenny Boulton, of Briggs and Morgan, P.A., described the request by Augustana Home of St. Paul for the EDA to issue health care revenue bonds to assist in financing the acquisition, renovation, and equipping of the Apple Valley Health Care Center, a 200 -bed skilled nursing home facility, located at 14650 Garrett Avenue. The Economic Development Authority would act as the conduit for the bonds. Neither the EDA or City would have additional liability or cost • associated with this project, nor would it impact the City's bond or credit rating. ECONOMIC DEVELOPMENT AUTHORITY City of Apple Valley Dakota County, Minnesota September 22, 2005 • Page 2 Mr. Lawell described the Payment in Lieu of Taxes Agreement with Augustana Chapel View Homes, Inc. Due to their non - profit status, if Augustana Care Corporation purchases the health care center, the nursing portion of the facility will become tax exempt. The housing portion will remain taxable. The Payment in Lieu of Taxes Agreement will help the City recoup some of the lost taxes. This payment is in addition to the $25,000.00 bond issuance fee. Commissioner Hamann -Roland asked about the possibility of locating a senior center on the site. Ms. Kopp said Augustana Care Corporation will have a four -year option agreement on the vacant parcel of property adjacent to the health care center. Future service needs and finances will play a role in determining whether a senior center on that site is possible. The Commissioners discussed their desire to retain as many Section 8 units as possible. President Severson called the public hearing to order, at 8:07 p.m., to consider issuance of revenue bonds for health care facilities, and noted receipt of the affidavit of publication of the hearing notice. The President asked for questions or comments from the Board and the public. Mr. Larry Oberloh, Apple Valley Health Care Center Administrator, said he is pleased Augustana • Care Corporation is interested in purchasing the facility because he feels they are a good match. He does not anticipate many changes from current operations. Hearing no other questions or comments, President Severson declared the hearing closed at 7:13 p.m. TWIN CITIES COMMUNITY CAPITAL FUND (TCCCF) Mr. Kelley reviewed his memo dated September 19, 2005, on the Twin Cities Community Capital Fund. TCCCF is a non - profit corporation that pools local funds used for gap financing. It provides local governments another tool to encourage economic development activities and local businesses the opportunity for larger loans. The EDA has $100,000 available from a recent payback of an economic development loan which could be used to participate in the program. The fund becomes operational after $2 million have been raised. To date 24 government agencies have enrolled. Members choosing to participate must deposit their money with TCCCF for a minimum of three years, after which time, funds may be withdrawn. Interest generated from deposits will fund the administrative costs of the program. Members choose which projects they wish to support through the fund. TCCCF loan officers prepare the loan documents and negotiate the sale of the loans on the secondary market. • MOTION: of Hamann - Roland, seconded by Goodwin, approving participation in the Twin Cities Community Capital Fund as a Class B member, for $100,000.00, and ECONOMIC DEVELOPMENT AUTHORITY City of Apple Valley Dakota County, Minnesota • September 22, 2005 Page 3 authorizing the President and Secretary to sign the Participation Agreement and Escrow Agreement. Ayes - 7 - Nays - 0. MOTION: of Hamann - Roland, seconded by Goodwin, authorizing issuance of a check in the amount of 90 percent ($90,000.00) of the Participation Amount payable to Wells Fargo Bank, N.A., Escrow Agent, and issuance of a check in the amount of 10 percent ($10,000.00) of the Participation Amount payable to Twin Cities Community Capital Fund. Ayes - 7 - Nays - 0. President Severson suggested staff may want to have a box luncheon for local lenders in order to educate them about the program. TUSCANY APARTMENT PROJECT Mr. Kelley gave an update on the Tuscany Apartment project, proposed for the southeast corner of Founders Lane and Galaxie Avenue in the Central Village. The developer is looking at various mechanisms to obtain the necessary financing for the project. They have contacted the • Dakota County Community Development Agency (CDA) to inquire about the use of tax credits. In order to be eligible for the use of tax credits, they would be required to set aside 20 percent of the apartment units to 60 percent of the area median income. This would be in addition to the 20 percent restricted to 50 percent of the area median income that is required as part of the previously approved tax increment financing. Before proceeding with this, the CDA has asked if the EDA would support it. There will be an opportunity at a public hearing for further comment. MOTION: of Erickson, seconded by Bergman, supporting an additional 20 percent of the Tuscany Apartment units to be designated for 60 percent of the area median income. Ayes - 6, Nays - 0, Abstain - 1 (Grendahl). SET SPECIAL MEETING MOTION: of Erickson, seconded by Bergman, setting a special meeting at 7:30 a.m. on October 13, 2005. Ayes - 7 - Nays - 0. MOTION: of Hamann- Roland, seconded by Grendahl, to adjourn. Ayes - 7 - Nays - 0. The meeting was adjourned at 8:44 o'clock p.m. •