HomeMy WebLinkAbout05/25/2017 EDA Meetingcity of AppleVlle
Y
Meeting Location: Municipal Center
7100 147th Street West
Apple Valley, Minnesota 55124
May 25, 2017
ECONOMIC DEVELOPMENT AUTHORITY MEETING TENTATIVE AGENDA
5:30 p.m.
1. Call to Order
2. Approve Agenda
3. Approve Consent Agenda Items
Consent Agenda Items are considered routine and will be enacted with a single motion,
without discussion, unless a commissioner or citizen requests to have any item separately
considered. It will then be moved to the regular agenda for consideration.
A. Approve Minutes of April 13, 2017
B. Adopt Resolution Authorizing TIF Note for Uponor North America
4. Regular Agenda Items
A. Discuss and Offer Feedback on Orchard Place and the use of Tax Increment for
Redevelopment
5. EDA Items and Communications
(For items EDA wishes to discuss)
6. Staff Updates
7. Adjourn
Regular meetings are broadcast, live, on Charter Communications Cable Channel 180 and on the City's
website at www.cityofapplevalley.org
ECONOMIC DEVELOPMENT AUTHORITY
City of Apple Valley
Dakota County, Minnesota
April 13, 2017
Minutes of the special meeting of the Economic Development Authority of Apple Valley, Dakota
County, Minnesota, held April 13, 2017, at 5:30 p.m., at Apple Valley Municipal Center.
PRESENT: Commissioners Bergman, Goodwin, Grendahl, Hamann -Roland, Hooppaw and
Maguire
ABSENT: Melander
City staff members present were: Executive Director Tom Lawell, City Attorney Michael
Dougherty, Community Development Director Bruce Nordquist, Planner/Economic Development
Specialist Alex Sharpe, Finance Director Ron Hedberg and Department Assistant Joan Murphy.
Meeting was called to order at 5:30 p.m. by President Goodwin.
APPROVAL OF AGENDA
MOTION: of Hamann -Roland, seconded by Grendahl, approving the agenda. Ayes - 6 - Nays
- 0.
CONSENT AGENDA
MOTION: of Bergman, seconded by Hamann -Roland, approving the minutes of the meeting
of March 23, 2017, as written. Ayes - 6 - Nays - 0.
MOTION: of Bergman, seconded by Hamann -Roland, adopting Resolution No. EDA 2017-02
consenting to Assignment of Tax Increment Financing and authorizing Execution
of Consent thereto and execution of Subordination Agreement for Parkside Gabella
Project. Ayes - 6 - Nays - 0.
ADJOURNMENT
MOTION: of Hamann -Roland, seconded by Hooppaw, to adjourn. Ayes - 6 - Nays - 0.
The meeting was adjourned at 5:32 p.m.
Respectfully Submitted,
n Murphy, Depart ent istant
Approved by the Apple Valley Economic
Development Authority on Thomas C. Goodwin, President
ell
City of App Vaiiey
MEMO
Planning & Development
TO: President, Economic Development Authority Commissioners, and
Executive Director
FROM: Alex Sharpe, Planner and Economic Dev. Spec.
DATE: 5/25/17
SUBJECT: Adopt Resolution Authorizing Execution of a Tax Increment Revenue Note for
Uponor North America
EDA Action
The EDA is asked to adopt a resolution authorizing the execution of a tax increment
revenue note for Uponor North America.
Background
On April 9, 2015, the Apple Valley Economic Development Authority (EDA) entered into a
development assistance agreement with Uponor Inc. for property owned by Uponor North
America Asset Leasing, Inc. The development assistance agreement included a "pay as you go"
financing provision where the developer could be reimbursed for eligible development costs
related to the construction of the Uponor Annex located at 14800 Everest Ave. This agreement
provided financial support not to exceed $504,000 for substantial site improvements. The
agreement required that at least 75 full time jobs at $15.00 an hour, plus benefits be created
within three years of the benefit date or December 31, 2016. As of February 2017 Uponor has
created/hired 127 new positions with an average hourly wage of $22.29 without benefits, and
average hourly wage of $30.51 with benefits The total development costs for this project are
estimated to be $12,300,000.
The "pay as you go financing" calls for repayment out of the annual TIF collected from the
project and is dependent on the property owner making the annual property tax payments and
annual special assessment payments, if any, to the city. The terms of the TIF Revenue Note did
not include an interest rate with the total value of the note not to exceed $504,000. The annual
payment is set at 90% of the TIF generated by the project and are applied towards the principal
balance until the balance is retired. The first year of increment collection will be 2017, with the
first payment due by August 1, 2017. The maximum length is based on collections through 2026.
The form and content of the note has been reviewed by legal counsel.
APPLE VALLEY ECONOMIC DEVELOPMENT AUTORITY
RESOLUTION NO. EDA -2017 -
RESOLUTION AUTHORIZING THE EXECUTION OF TAX INCREMENT
REVENUE NOTE
WHEREAS, the Apple Valley Economic Development Authority approved a
Development Assistance with Uponor NA Asset Leasing, Inc. on April 9, 2015, and
WHEREAS, the Development Assistance Agreement provided for the financing
of costs incurred in connection with construction of a building expansion that was
constructed by Uponor NA Asset Leasing, Inc., and
WHEREAS, Uponor NA Asset Leasing, Inc has submitted documentation of
eligible expenditures exceeding the maximum amount provided for in the Development
Assistance Agreement, and
NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of the
Apple Valley Economic Development Authority, in and for the City of Apple Valley,
Minnesota, that the Tax Increment Revenue Note in the form is attached, and the President
and Secretary are hereby authorized and directed to execute the Tax Increment Revenues
Note on behalf of the EDA.
ADOPTED this 25th day of May 2017.
Thomas C. Goodwin, President
ATTEST:
Pamela J. Gackstetter, Secretary
EXHIBIT B
Form of TIF Note
No. R -I
UNITED STATES OF AMERICA
STATE OF MINNESOTA
COUNTY OF DAKOTA
APPLE VALLEY ECONOMIC DEVELOPMENT AUTHORITY
TAX INCREMENT REVENUE NOTE
(UPONOR, INC. PROJECT)
The Apple Valley Economic Development Authority, Minnesota (the "Authority"),
hereby acknowledges itself to be indebted and, for value received, hereby promises to pay the
amounts hereinafter described (the "Payment Amounts") to Uponor NA Asset Leasing, Inc. (the
"Landlord") or its registered assigns (the "Registered Owner"), but only in the manner, at the
times, from the sources of revenue, and to the extent hereinafter provided.
The principal amount of this Note shall equal from time to time the principal amount
stated above, as reduced to the extent that such principal installments shall have been paid in
whole or in part pursuant to the terms hereof; provided that the sum of the principal amount
listed above shall in no event exceed $504,000 as provided in that certain Development
Assistance Agreement, dated as of May 2015, as the same may be amended from time to
time (the "Development Assistance Agreement"), by and between the Authority, the Landlord
and Uponor, Inc. (the "Company"), This Note bears no interest.
The amounts due under this Note shall be payable on August 1, 2017, and on each
February 1 and August 1 thereafter to and including February 1, 2026, or, if the first should not
be a Business Day (as defined in the Development Assistance Agreement), the next succeeding
Business Day (the "Payment Dates"), On each Payment Date the Authority shall pay by check
or draft mailed to the person whom was the Registered Owner of this Note at the close of the last
business day preceding such Payment Date an amount equal to the sum of the Tax Increments
(hereinafter defined) received by the Authority during the six month period preceding such
Payment Date. All payments made by the Authority under this Note shall be applied to
principal.
The Payment Amounts due hereon shall be payable solely from 90% of tax increments
(the "Tax Increments") from the Development Property (as defined in the Development
Assistance Agreement) within the Authority's Tax Increment Financing District No. 16 (the "Tax
Increment District") within its Master Development District which are paid to the Authority and
which the Authority is entitled to retain pursuant to the provisions of Minnesota Statutes,
Sections 469.174 through 469.1794, as the same may be amended or supplemented from time to
time (the "Tax Increment Act"). This Note shall terminate and be of no further force and effect
following: (1) the last Payment Date defined above; (ii) on any date upon which the Authority
shall have terminated the Development Assistance Agreement under Section 4.2(2) thereof or the
B-1
6967750v7
Landlord shall have terminated the Development Assistance Agreement under Article V thereof;
(iii) on the date the Tax Increment District is terminated; or (iv) on the date that all principal
payable hereunder shall have been paid in full, whichever occurs earliest.
The Authority makes no representation or covenant, express or implied, that the Tax
Increments will be sufficient to pay, in whole or in part, the amounts which are or may become
due and payable hereunder.
The Authority's payment obligations hereunder shall be further conditioned on the fact
that no Event of Default under the Development Assistance Agreement shall have occurred and
be continuing at the time payment is due hereunder, but subject to the terms and conditions under
the Development Assistance Agreement such unpaid amounts may become payable if said Event
of Default shall thereafter have been timely cured. Further, if pursuant to the occurrence of an
Event of Default under the Development Assistance Agreement the Authority elects to cancel
and rescind the Development Assistance Agreement, the Authority shall have no further debt or
obligation under this Note whatsoever. Reference is hereby made to all of the provisions of the
Development Assistance Agreement, and said provisions are hereby incorporated into this Note
as though set out in full herein.
This Note is a special, limited revenue obligation and not a general obligation of the
Authority and is payable by the Authority only from the sources and subject to the qualifications
stated or referenced herein. This Note is not a general obligation of the Authority and neither the
full faith and credit nor the taxing powers of the Authority are pledged to the payment of the
principal of this Note and no property or other asset of the Authority, save and except the above -
referenced Tax Increments, is or shall be a source of payment of the Authority's obligations
hereunder.
This Note is issued by the Authority in aid of financing a project pursuant to and in full
conformity with the Constitution and laws of the State of Minnesota, including the Tax
Increment Act.
This Note may be assigned only with the consent of the Authority which consent shall
not be unreasonably -withheld, provided that the assignment of the Note to Uponor, Inc. shall not
require the consent of the Authority. In order to assign the Note, the assignee shall surrender the
same to the Authority either in exchange for a new fully registered note or for transfer of this
Note on the registration records for the Note maintained by the Authority. Each permitted
assignee shall take this Note subject to the foregoing conditions and subject to all provisions
stated or referenced herein.
IT IS HEREBY CERTIFIED AND RECITED that all acts, conditions, and things
required by the Constitution and laws of the State of Minnesota to be done, to have happened,
and to be performed precedent to and in the issuance of this Note have been done, have
happened, and have been performed in regular and due form, time, and manner as required by
law; and that this Note, together with all other indebtedness of the Authority outstanding on the
date hereof and on the date of its actual issuance and delivery, does not cause the indebtedness of
the Authority to exceed any constitutional or statutory limitation thereon,
B-2
6967750v7
IN WITNESS WHEREOF, Apple Valley Economic Development Authority, Minnesota,
by its Board of Commissioners, has caused this Note to be executed by the manual signatures of
its President and Secretary and has caused this Note to be dated as of
20
President Secretary
DO NOT EXECUTE UNTIL PAID INVOICES FOR SITE IMPROVEMENTS ARE
GIVEN TO THE CITY - REFER TO SECTION 3.2
B-3
69677500
le
City of AppValle)/
MEMO
Community Development
TO: EDA President, Commissioners and Executive Director
FROM: Bruce Nordquist, AICP, Community Development Director
MEETING
DATE: May 25, 2017
SUBJECT: Discuss and Offer Feedback on Orchard Place and the use of Tax Increment
Financing (TIF)
Action Requested
No action is requested of the EDA on May 25. It is important that the EDA focus their
discussion and feedback on the use of the TIF tool and the measurable benefits to be
met and not focus on the Orchard Place proposal as a future land use application. The
development proposal is not before the EDA. The uses are subject to City processes,
which to date have not been applied for and should not be further discussed. The
owner has the soil deficiency cost regardless of TIF, which cost is solely due to
circumstances it created. The use of TIF allows the owner to recover the cost, but also
allows the City to obtain beneficial elements and improvements that may not otherwise
be available or cost effective.
Background
At the May 25, 2017, EDA meeting; staff plans to provide an Orchard Path overview, an
update concerning ongoing discussion about beneficial elements and improvements
with staff and the property owner/developer — Rockport, LLC. — (Rockport), and provide
an introduction to the use of tax increment for redevelopment of the active mining area.
Given that the 400 acres active mining area represents the last large undeveloped area
in the City, it is vitally important that the development be of high quality and help
advance the City's goals as expressed in our Comprehensive Plan. Particular
emphasis should be given to advancing our business development goals and the
creation of more head of household jobs within the community as community housing
objectives are already being met. Staff consistently has requested that "prior to
proceeding with consideration of the tax increment application, it is important that the
master planning effort for the project area be advanced to a stage where the City
Council will be able to determine the benefit of their tax increment investment". (See
attached letter of October 21, 2016, from Tom Lawell to Liza Robson).
A presentation was made by Rockport to the Planning Commission on March 30, 2017.
That presentation is available at the City's website under the Planning Commission link.
With this presentation, Pete Fischer and Liza Robson officially launched Orchard Place,
the redevelopment of the 400 acre active mining area. The objective of their
presentation was to introduce the new brand, provide a historical context, present
existing site conditions and the sheer size of the area and introduce design and land
use development ideas.
An application for TIF resources is being considered (to be known as TIF 18) to
coincide with anticipated development applications for 40 acres of commercial property
at 157th Street and Pilot Knob Road. It is important that the master planning effort also
advances the themes, features and priorities for the 400 acre development using the
initial 40 acres of commercial as a built environment example of more to come. The
effort should be sufficiently advanced to a stage where the Economic Development
Authority and City Council will be better able to determine the benefit of the tax
increment investment to take action on the TIF application and initial land uses. This
feedback builds on desirable development images introduced by Rockport, Kimley-Horn
and Architectural Consortium, LLC, for the 40 acres of commercial development.
Initial staff feedback to the Orchard Place presentation is as follows:
• The retail center represents the next generation of Fischer Marketplace. The
illustrated internal street alignment and access points are efficient and building
placements lining the drives reduce large parking lot massing. Given the
evolving retail marketplace and broader area expectations, does this initial 40
acre development set the bar high enough for the development that will follow on
the remainder of the 400 acre site?
• For the 40 acres, further discussion about the "squareness" of building
placement on the site is sought. The large boxes facing Pilot Knob offer good
business visibility, however, the possible water and pedestrian bike amenities
are behind the retail center or not maximized along 157th Street to the benefit of
the user in an experiential commercial environment. Are there
northwest/southwest positions to consider for the westerly buildings?
• For the 400 acres, Rockport's planning consultant Kimley-Horn has multiple
specialties in engineering, planning and design, placemaking and energy
innovation and redevelopment. Very successful developments by Kimley-Horn,
and examples found in other communities demonstrate sought-after features.
Centennial Lakes development in Edina, a previous active mining area, is
notable for its landscape architecture influence of Kimley-Horn's Tom Harrington.
Images from these locations, to be shared with the EDA, offer the sought-after
features of: vistas, water amenities, lighting, natural stone, creative building
placement, trail connections, and tunnels and bridges. Perhaps the next
generation of Centennial Lakes with insight and lessons learned provides the
experiential retail, office, hospitality and industry to be sought for Apple Valley.
The active mining area is envisioned to be transformed into part of "a multi -billion dollar
strand of pearls on an economic greenway". North to south on the developing Dakota
County North Creek Greenway in Apple Valley, are the connections of: the MN Zoo,
neighborhoods, high schools, Uponor, Abdallah, a master planned Hanson/Menard
property and Orchard Place. From Orchard Place, connections are planned west and
east to the Downtown and Cobblestone Lake along a tree lined boulevard.
Historical Context
Historical studies and data are the foundational information for a discussion of future
development. The 1989 EIS, the 2030 Comprehensive Plan and the recent 2016 AUAR
Update offer insight for a discussion of a design framework and development goals and
priorities for the entire 400 acres:
• The 1989 EIS envisioned housing and commercial and industrial uses for an
area much larger than the remainder being discussed today. The study
emphasized the considerable number of years for these uses to be absorbed by
the marketplace. Rockport, today, maintains that Orchard Place will be many
years in the making. An emphasis on storm water management was also a
priority in the EIS. "Lakes" were placed south of County Road 42 in a linear
pattern and proposed from Flagstaff Avenue and across future Johnny Cake
Ridge Road, Pilot Knob Road and Diamond Path. Thus far, only Cobblestone
Lake has become a reality.
• The 2030 Comprehensive Plan Update was completed in 2009. The land use
designation for the active mining area is predominately "mixed business campus"
(MBC).This use is described as "high quality settings for office campus, office
with light industrial, office with biomedical manufacturing, health care facilities
and training, general office, corporate office and other higher intensity
employment uses". Mixed retail, commercial services and housing are supportive
uses.
• An AUAR (Alternative Urban Areawide Review) was prepared in 2007 and
updated in 2016. The land uses identified within the AUAR and most recently
stated in Rockport's master plan goals map for the 400 acres include: office,
hotel, medical, commercial/retail, industrial, corporate office, supportive office
and multi -unit housing.
At the May 17 Planning Commission meeting, staff presented additional design and
placemaking elements for consideration. Images to be shared with the EDA have
already been shared with Rockport and the Planning Commission. Beyond
placemaking and design, staff offers additional elements to consider as a condition to
the use of TIF.
Place Making Image Examples
Like the Rockport team working on Orchard Place, staff has assembled and will share
images that convey place, appealing design, the examples of water, water amenities,
lighting and nature stone, and building placement and trails. Safe pedestrian and
bicycle crossings to and from, and within, the 400 acres site are important and should
be considered as part of the overall development concept for the site, including tunnels
and bridges as appropriate.
• Kimley-Horn, at their website, offers a variety of placemaking, landscape
architecture, redevelopment and land use renderings and photos to describe
desirable built environments and amenities like water features, lighting and trail
and streetscapes. Four sided architecture remains a City priority.
• The City of Greenville, South Carolina also has created a place in their
downtown that demonstrates community, integration of sought after uses,
modern city features and a destination.
• The City of Edina, MN, already referred to as the location of Centennial Lakes,
offers a series of images of office, retail, hospitality, vistas, connections and a
destination.
• Finally, there are renderings and photos of the Bruce Vento Regional Trail
bridge, planned for St. Paul that are representative of possible future trail
crossings serving the site. As with the County Greenway, the City needs to be
careful in identifying the benefits that it may receive resulting from the impacts
associated with the proposed development and use of TIF. Regional benefits
are generally not supportable as they represent more impact than generated
from the area being developed.
Elements that staff recommends should be considered with the use of TIF
1) It is recommended that storm water ponding today include some linear elements with
secondary treatment ponds. Water amenities should be considered throughout
Orchard Place; leveraging the north to south changing grade.
2) How can bike/pedestrian tunnels, trails, bridges and vistas be incorporated?
3) The following economic development strategies for the Mixed Business Campus are
recommended:
• A floor -to -area ratio (FAR) of intensity of land development of .5 and .6 for
hospitality and office; a lessor ratio for retail and industry.
• 2,000 to 3,000 jobs over the 400 acres.
• How can these stated expectations be addressed in a reasonable way as
Rockport sells to others for development?
4) The recommended goals consistent with both AUAR's during the last 10 years are:
• 3,321,000 sq. ft. of the referenced uses.
• Built space that accommodates 3,000 jobs.
• How can these stated expectations be addressed in a reasonable way as
Rockport sells to others for development?
5) Rockport's stated expectations for the initial 40 commercial acres is 200,000 square
feet of development. The concept drawings show 404,500 sq. ft. Can the two amounts
be more closely reconciled since this lead development work will be overseen by
Rockport as developer?
6) It is recommended that a landscape architect with considerable experience in
designing "places" from mining areas be engaged to assist with the 400 acres. How
does Rockport plan to respond?
The Role of Tax Increment at Orchard Place
Tammy Omdal of Northland Securities is attending the May 25 EDA meeting to offer a
more detailed presentation on the tax increment application. Ms. Omdal prepared the
following information.
Background on Special TIF Legislation
In 2013, the Minnesota Legislature passed special enabling legislation for the City of
Apple Valley which provides special authority related to the Fischer Aggregate mining
site property within the City. In summary, the special legislation provided authority for
the City to establish a "project area" that meets certain criteria provided in the special
law and to establish a special type of tax increment financing (TIF) district, a "soil
deficiency district" within the project area, along with the establishment of other types of
tax increment financing districts allowed by current law. To establish a "soil deficiency
district" under the special law requires that the City find by resolution that certain
conditions exist within the boundaries of the district.
The establishment of a TIF district allows the City to capture the increase in certain
property taxes payable from new development for a defined period of time. The City is
able to capture the increase in all property taxes, except for State property taxes,
general education levy taxes, or referendum property taxes, to provide financial
assistance to a project. To establish a TIF district, a city or an authority must find that a
proposed development or redevelopment would not reasonably be expected to occur
solely through private investment within the reasonably foreseeable future (emphasis
added), among other findings that must be made. Rockport maintains that TIF will
advance development more quickly than a projected 15 to 45 years.
Request for Tax Increment Financing Assistance
In April 2016, Fischer Sand & Aggregate, LLP (now referred to as "Rockport" or the
"Developer") submitted an application to the City for TIF assistance, consistent with the
Special TIF Legislation, for the reclamation of its gravel mining site for development.
The entire site is now being referred to and marketed by the Developer as "Orchard
Place". City staff and the Developer have been meeting to consider the application and
request for assistance. In June 2016, the City Council, pursuant to the Special TIF
Legislation, adopted a resolution approving the project area and making findings
regarding the project area. This was the first step before the EDA and City could
consider the establishment of a TIF district.
The next step is to consider the establishment of a TIF district. Prior to the
establishment of a TIF district, the City must provide written notice to the County and
School District and a copy of a written plan for the TIF district. The process will
commence at such time the EDA is ready to request the City Council to call for the
public hearing. City staff is anticipating this request by the EDA may occur in June or
July, which will begin the process for the establishment of a TIF district. The entire
approval process is anticipated to take approximately 60-90 days starting with the
calling for the public hearing.
Preliminary Points of Agreement for Discussion
Recent and on-going discussions between City staff and the Developer have resulted in
certain points of preliminary agreement that City staff is presenting to the EDA to seek
feedback and comment:
1. The City and EDA will consider the establishment of a single TIF district within
the established project area. No other future TIF districts will be established
within the project area. This will result in the City realizing benefit from the
increase in tax base from new development within the TIF district earlier than
otherwise may be the case. It also allows for less administrative cost for the City
and the potential complication of calculating pooled versus in -district project
costs, pursuant to the Special TIF Legislation.
2. The required increase in contribution to the fiscal disparities pool (metro -wide
commercial tax base sharing program) due to an increase in taxable market
value from new development within the TIF district will be paid from the district.
This will avoid having an impact (i.e., an increase) to the City's property tax rate.
3. The City will consider the use of TIF for reimbursement of reclamation costs only
and not for any extraordinary or other costs of installing public improvements and
streets. The costs of installing public improvements and streets will be paid by
the future development or other sources of revenue.
4. The TIF district will not include the capturing of increased taxes payable from the
development of single-family housing. As land is platted for single-family
housing, those parcels will be removed from the TIF district. This will result in the
taxes payable from single-family properties being distributed to each of the
respective taxing jurisdictions with no capturing of property taxes (i.e., TIF) to
assist with paying for reclamation of land costs.
5. The analysis of the need for assistance will include a review of the net present
value of reclaimed land per square foot with and without TIF assistance.
6. The City and EDA will consider the issuance of a TIF Note to reimburse a not to
exceed amount of costs of reclamation of land. The TIF Note shall be payable
with interest; a 5.75% simple non -compounded rate. The tax increment financing
assistance will be limited solely to reclamation of land costs as evidenced by the
submission of invoices to the City for review and certification by the EDA on an
agreed to schedule up to the not to exceed amount.
Open Items for Discussion
There are two areas remaining for discussion where City staff and the Developer are
continuing discussions to reach a preliminary point of agreement. City staff is
presenting these open items to the EDA to seek feedback and comment:
1. Development performance timelines and the measurement for defining minimum
improvements that will be included in the development assistance agreement.
2. Goals (jobs and/or other tangible benefits acceptable to the City) to satisfy the
City's business subsidy policy and compliance with the State business subsidy
law.
Preliminary Estimates for TIF
The estimates provided here are preliminary, for discussion purposes only, and are
subject to change prior to the EDA and City Council final consideration of any
agreements with the Developer. The analysis completed to prepare these estimates is
based on information provided by the Developer, including the proposed types of
development (i.e., big box, office space, industrial, etc.), square footage, and completion
dates.
1. Total maximum tax increment to be collected over the maximum duration of 21
years for the proposed "soil deficiency district" to be established is presently
estimated at approximately $43 million.
• Total taxable market value within the TIF district, which will not include
single-family housing, is estimated to reach approximately $333 million by
year 2040, the estimated final year of the TIF district.
2. Developer is requesting reimbursement of approximately $20.8 million in agreed
to reclamation costs, as incurred, payable solely from semi-annual available tax
increment in the form of a pay -go TIF note. The TIF note is proposed to bear
interest, the 5.75 percent simple non -compounded rate previously stated.
Attachments to the EDA Staff Report
• October 2016 letter, Lawell to Robson
• Outline of Stated Goals and Initial Improvements by legal counsel for Rockport,
April 20 and May 18, 2017
• Draft TIF 18 District Map
• Land Use Plan Concept Map for Orchard Place, March 2017
• Land Use Plan Concept Map with Development Concepts, March 2017
• Land Use Concept Map, initial 40 acres and 404,500 sq. ft. of development,
March 2017
• Land Use Concept Map, Phase 2 Medical Office, on 49 additional acres, March
2017
City of
Apple„
Valley
7100 147th Street W
Apple Valley, MN 55124-9016
October 21, 2016
Ms. Liza Robson
Fischer Sand and Aggregate, LLP
14698 Galaxie Avenue
Apple Valley, MN 55124
Dear Liza:
Telephone (952) 953-2500
Fax (952) 953-2515
www.cityofapplevalley.org
Thanks for meeting with City staff and our consultants to discuss your tax increment
financing application in support of the redevelopment of your remaining sand and gravel
mining property in Apple Valley. As we have discussed, ths laige tract of land has
great potential to enhance the livability and viability of the y through the
thoughtful developnlent of a combination of office, research, medical, manufacturing,
retail and residential uses.
The work of our consultants has been beneficial in determining how tax increment
financing may apply to the redevelopment of the property. While there are many details
left to be worked out, it is clear this tax increment district has the potential of generating
significant tax increment revenues over the life of the district. As you are aware, the
approval of tax increment financing is a discretionary act of the Apple Valley City
Council. 1 i
1 order to provide the City Council with the best information possible n
making a decision on the tax increment application, it is important that they have a clear
ture of the development they are being asked to support.
It is encouraging that you have identified an experienced team (Elion Partners and
Krause -Anderson) who are interested in being involved in the development and
P
im lementation of a master plan for the property. Prior to proceeding with consideration
of the tax increment application, it is important that the masterplanning effort for the
project area be advanced to a stage where the City Council will be better able to
determine the benefit of their tax incrernent investment.
Prior to engaging in additional tax increment discussions, it would be beneficial to meet
with you and representatives from Elion Partners andKrause-Anderson to discuss the
development of a master plan for the site. At one point representatives from Elion
Home of the Minnesota Zoological Garden
Ms. Liza Robson
October 21, 2016
Page 2
indicated their interest in conducting a design charrette process that would include input
from all interested parties, including the Apple Valley Planning Commission and City
Council. A shared vision for the development of the property would be very beneficial to
all, and we look forward to working with you and your team on this important next step.
Sincerely,
CITY OF APPLE VALLEY
Tom Lawell
City Administrator
C: Apple Valley City Council
Gerry Duffy, Monroe Moxness Berg PA
Jim Casserly, Monroe Moxness Berg PA
Tammy Omdal, Northland Securities
Mary 1ppel, Briggs and Morgan
MONROE
110)(NESS
BERG
James R. Casserly
jcasserly@mmblawfirm.com
Direct 952.885.1296
MEMORANDUM
To: TIF Working Group
7760 France Avenue South
Suite 700
Minneapolis, MN 55435-5844
From: Monroe Moxness Berg PA
James R. Casserly, Esq. and Vickie Loher-Johnson, Esq.
Date: April 20, 2017
Re: Goals and Initial Improvements
Our File No. 16137-5
T 952.885.5999
F 952.885.5969
MMBLawFirm.com
The land use goals for the Site, which will generate an enormously increased tax base
with no risk to the City, are described on the attached Site Land Use Goals Diagram.
Following the example of Fischer Market Place, reimbursement for eligible expenses
approved by the EDA, as evidenced by the EDA Note, shall commence upon a Certificate of
Completion being issued for Lot L when the following conditions are satisfied:
1. 200,000 square feet of development;
2. Reclamation in accordance with the Special Law;
3. Johnny Cake Ridge Road and utilities from 157th Street to the north boundary line
of Lot J;
4. 155th Parkway from Pilot Knob Road to the west boundary line of Lot L;
5. Stormwater (Infiltration) Pond adjacent to the west boundary line of Lot L;
6. Internal access ways, parking lots and landscaping of Lot L.
Further eligible expenses will be added to the EDA Note as incurred and approved, and
reimbursement will only be from tax increment generated as a result of improvements to the Site.
JRC/jmw
S'11:11.17:tR
D ST
MWA
TAR9ET
30
11111„„„„h„,„:„...,...,
118,11 ORCHARD PLACE APPLE VALLEY, MN
\cv APRIL 2017
IT
N
_USE GOALS DIAGRAM
Acreage Propo,ctl Land Uses Goals
Density or EA R.
Range Goals
A 25.5
Office 0261o0.30
Hotel 0.35 to 0.50
Medical 0,2510 0.40
Commercial Retell 6 18 0.30
B 5.9 Office 026100.36
Hotel 0,35 to 0 50
Medical 0.25 to 0.40
Commercial Retail 0.1815030
C 29.5 Office 0,2510.35
Hotel 0.35 ict 0.50
Medical 0.2510 0.40
O 14.5 Commercial Retail 0.18 to 0.3D
Oftice 0.35 to 0.35
Meclical 0.25 30.40
E 2.8
F 1.7
• 112
H 129
I 27.4
Multi -Family Residential
Senior Housing
Office
Industrial
Medical
Medical
Corporate Campus
Supportive Office
Industrtal
Supportive Commercial Retaitl
Supportive Commercial Rota'
Supportive Office
Hotel
Medical
Singlef amity Roso2enal
J 16.0 Singletramily Residential
K 24.4 Multitiamtly ReF.idential
Senior Housing
Commercial Retail
Office
Medical
L 30,7
TOTALS
INun-Residential Uses
Residential Uses
ACCESS KEY
Full Access
3/4 ALcesti
Right-infRoght-uut Only
4.0 10 30 0
12.0 to 30 0
0.25 f°,:3455
0.25 .0.40
0 2510 0.40
0 2510 0 35
0 2510 0 31
0 30 to 0.45
0.19100.33
0 1010 0,30
0.2510 0,35
0,35 to 0.50
0.2010 0.40
3.0 10 4.0
3.0 to 4.0
4 010 30.0
12.01030.0
0.18100.10
0.2506.30
0.20100,40
251 9 Acres
71.2 Acres
Kirniey>>>Horn
Nord
From:
Sent:
To:
Cc:
uist, Bruce
James Casserly <jcasserly@mmblawfirm.com>
Thursday, May 18, 2017 11:47 AM
Nordquist, Bruce
Liza Robson (lizarobson@avrconcrete.com); Pete Fischer; Tammy
Omdal (tomdal@northlandsecurities.com); Greg Johnson
(gjohnson@sbgb.com); Hedberg, Ron
Subject: FW: Commercial Office Development on Fischer AV site - UPDATED
Attachments: Site Plan - KH 2-14-17.pdf; Fischer Sand - AV 2017c
Development.pdf
Bruce, last week Liza shared with us the memo she received from you regarding redevelopment at Orchard Place. I think
substantial progress is being made. One of the items in the memo referred to recommended goals of achieving
3,321,000 square feet of office, retail and industrial development. Greg and I have been reviewing our most recent
analysis for the site which is attached. In this analysis we have 3,353,917 of office, retail and industrial development. We
only point this out because the numbers are almost identical and we have a shared vision.
(The attached Site Plan works with the TIF Analysis the only adjustment is in Area J where the area to be developed is
now 12.98 acres.)
Look forward to resolving any remaining issues. Jim
James R. Casserly
Attorney at Law
MONROE MOXNESS BERG PA
7760 France Ave South, Suite 700
Minneapolis, MN 55435
D 952.885.1296
www.MMBLawFirm.com
Confidentiality Notice:
The information contained in this email message, and any accompanying attachment, is confidential and [privileged. It is intended only
for the use of each recipient. If you are not an intended recipient, or the employee or agent responsible to deliver this message to an
intended recipient, please notify us immediately by telephone.
1
Page 1
FISCHER SAND & AGGREGATE
Apple Valley
Areas 1, 2, 3, 4, 5 & 6
Market Value, Sq. Ft. and Unit Assumptions
Based on Kimley Horn Land Use Map of 2-14-2017
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
,
Average
Develop-
Mkt Value
Assessed
AREA
Percent
Acres
Sq. Ft.
Density
Ment
Per Unit
Value
A
Office
32.0%
8.16
355,450
30.0%
106,635
90.00
$ 9,597,139
Hotel / Other
4.0%
1.02
44,431
42.5%
18,883
50.00
944,163
Medical
32.0%
8.16
355,450
32.5%
115,521
90.00
10,396,901
Commercial Retail
32.0%
8.16
355,450
24.0%
85,308
80.00
6,824,632
Total
100.0%
25.50
1,110,780
29.4%
326,347
85.07
27,762,835
B
Office
32.0%
1.89
82,241
30.0%
24,672
90.00
2,220,515
Hotel / Other
4.0%
0.24
10,280
42.5%
4,369
50.00
218,453
Medical
32.0%
1.89
82,241
32.5%
26,728
90.00
2,405,557
Commercial Retail
32.0%
1.89
82,241
24.0%
19,738
80.00
1,579,033
Total
100.0%
5.90
257,004
29.4%
75,508
85.07
6,423,558
C
Office
48.0%
14.16
616,810
30.0%
185,043
90.00
16,653,859
Hotel / Other
4.0%
1.18
51,401,
42.5%
21,845
50.00
1,092,267
Medical
48.0%
14.16
616,810
32.5%
200,463
90.00
18,041,681
Commercial Retail
0.0%
0.00
0
24.0%
0
80.00
0
Total
100.0%
29.50
1,285,020
31.7%
407,351
87.85
35,787,807
D
Office
33.3%
4.83
210,540
30.0%
63,162
90.00
5,684,580
Hotel / Other
0.0%
0.00
0
42.5%
0
50.00
0
Medical
33.3%
4.83
210,540
32.5%
68,426
90.00
6,158,295
Commercial Retail
33.3%
4.83
210,540
24.0%
50,530
80.00
4,042,368
........ _...________
Total
100.0%
14.50
631,620
28.8%
182,117
87.23
15,885,243
E
Multi -Family Resident
50.0%
1.40
60,984
17.0
24
105,000
2,499,000
Senior Housing
50.0%
1.40
60,984
21.0
29
105,000
3,087,000
Total
100.0%.
2.80
121,968
19.0
53
105,000
5,586,000
F
Office
33.3%
20.57
895,884
30.0%
268,765
90.00
24,188,868
Industrial
33.3%
20.57
895,884
37.5%
335,957
50.00
16,797,825
Medical
33.3%
20.57
895,884
32.5%
291,162
90.00
26,204,607
Commercial Retail
0.00
0
24.0%
0
80.00
0
Total
100.0%
61.70
2,687,652
33.3%
895,884
75.00
67,191,300
Fischer Sand - Apple Valley 2017c.xlsx Prepared by Sevenich, Butler, Gerlach & Brazil, Ltd.
5/18/2017
Page 2
FISCHER SAND & AGGREGATE
Apple Valley
Areas 1, 2, 3, 4, 5 & 6
Market Value, Sq. Ft. and Unit Assumptions
Based on Kimley Horn Land Use Map of 2-14-2017
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(1)
Average
Develop-
Mkt Value
Assessed
AREA
Percent
Acres
Sq. Ft.
Density
Ment
Per Unit
Value
G
Supportive Office
10.0%
7.12
310,147
30.0%
93,044
90.00
8,373,974
industrial
10.0%
7.12
310,147
37.5%
116,305
50.00
5,815,260
Medical/Corp Campus
70.0%
49.84
2,171,030
32.5%
705,585
90.00
63,502,639
Commercial Retail
10.0%
7.12
310,147
24.0%
74,435
80.00
5,954,826
Total
100.0%
71.20 ,
3,101,472
31.9%
989,370
84.55
83,646,700
H
Supportive Office
32.0%
4.13
179,816
30.0%
53,945
90.00
4,855,023
Hotel / Other
4.0%
0.52
22,477
42.5%
9,553
50.00
477,635
Medical
32.0%
4.13
179,816
32.5%
58,440
90.00
5,259,609
Commercial Retail
32.0%
4.13
179,816
24.0%
43,156
80.00
3,452,461
---
Total
100.0%
12.90
561,924
29.4%
165,093
85.07
14,044,728
I
Single Family Resider
100.0%
27.40 ,
1,193,544
3.5
_ 96
400,000
38,360,000
0.0%
0.00
0
0
0
......
............. ....
Total
100.0%
27.40
1,193,544
3.5
96
400,000
38,360,000
J
Single Family Resider
100.0%
12.98
565,409
3.5
45
400,000
18,172,000
0.0%
0.00
0
0
0
Total
100.0%
12.98
565,409
3.5
45
400,000
18,172,000
K
Multi -Family Resident
50.0%
12.20
531,432
17.0
207
105,000
21,777,000
Senior Housing
50.0%
12.20
531,432
21.0
256
105,000
26,901,000
_
.......... .................
Total
100.0%
24.40
1,062,864
19.0
.
464
105,000
48,678,000
L
Office
20.0%
6.14
267,458
23.3%
62,318
90.00
5,608,603
Hotel / Other
0.0%
0.00
0
42.5%
0
50.00
0
Medical
0.0%
0.00
0
32.5%
0
90.00
0
Commercial Retail
80.0%
24.56
1,069,834
23.3%
249,271
80.00
19,941,698
............ .......... ....
..... _ .......
.................
Total
100.0%
30.70
1,337,292
23.3%
311,589
82.00
25,550,301
,
Commercial Totals
251.90
10,972,764
30.6%
3,353,259
82.40
276,292,473
Residential Totals
67.58
2,943,785,
9.7
658
168,350
110,796,000
SITE TOTALS
,
319.48
13,916,549
3,353,917
sq. ft.
$387,088,473
1
0
1
Fischer Sand - Apple Valley 2017c.xlsx Prepared by Sevenich, Butler, Gerlach & Brazil, Ltd.
5/18/2017
2 2 V- 2 2 .2 •V- 2 2 .5! 2 .2
ci ocioci tiaca daa
ci ci ci ci ci ci • ci
TT;
lb:
-62
0.
,to
1
17,
,L11
a
aoadc; -c coo izt" Oa.
2oo =00000 29,2 2 "Tr o2
c".11, c:2 te
o ci c; , ascl
w
0
70
'' F joil M I i
.a.,3
ill TS— tht' 'flu —
0 .9
• 03
':Cs4
i 27A Single -Family Residential
;
ru
I 31V3 ANNHOr
APPLE VALLEY,
03 al
C c
O O
CO CO
ti) C)
L
L
a cD
u..
u
iz
00
03
O
Z
DISTRICT
0
O
O
O
s
s
s
s