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HomeMy WebLinkAbout07/27/2017 EDA MeetingApple ��ey Meeting Location: Municipal Center 7100 147th Street West Apple Valley, Minnesota 55124 July 27, 2017 ECONOMIC DEVELOPMENT AUTHORITY REGULAR MEETING TENTATIVE AGENDA 6:00 PM 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 June 22, 2017, Special Meeting 4. Regular Agenda Items A. Oudot C, Valley Business Park 1. Hold Public Hearing 2. Adopt Resolution Approving Findings and Sale of Property to Miller Farms of Lakeville, LLC B. Village Pointe Plaza/Zvago Apple Valley 1. Staff Update on Preparation of Business Subsidy Agreement 2. Continue Public Hearing for Business Subsidy Agreement to August 10, 2017, at 5:30 P.M. or as soon thereafter as possible. 5. Other 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 AppValley SECTION: ITEM: 3.A. ECONOMIC DEVELOPMENT AUTHORITY MEETING DATE: July 27, 2017 Approve Consent Agenda Items Description: Approve Minutes of June 22, 2017, Special Meeting Staff Contact: Joan Murphy, Department Assistant ACTION REQUESTED: Approve minutes of special meeting of June 22, 2017. Department / Division: Community Development Department SUMMARY: The minutes of the special Economic Development Authority meeting are attached for your review and approval. BACKGROUND: State statute requires the creation and preservation of meeting minutes which document the official actions and proceedings of public governing bodies. BUDGET IMPACT: N/A ATTACHMENTS: Minutes ECONOMIC DEVELOPMENT AUTHORITY City of Apple Valley Dakota County, Minnesota June 22, 2017 Minutes of the special meeting of the Economic Development Authority of Apple Valley, Dakota County, Minnesota, held June 22, 2017, at 6:30 p.m., at Apple Valley Municipal Center. PRESENT: Commissioners Bergman, Goodwin, Grendahl, Hamann -Roland, Hooppaw and Melander ABSENT: Maguire City staff members present were: Executive Director Tom Lawell, City Attorney Michael Dougherty, Community Development Director Bruce Nordquist and Department Assistant Joan Murphy. Meeting was called to order at 6:30 p.m. by President Goodwin. APPROVAL OF AGENDA MOTION: of Melander, seconded by Hamann -Roland, approving the agenda. Ayes - 6 - Nays - 0. CONSENT AGENDA MOTION: of Hamann -Roland, seconded by Bergman, approving the minutes of the meeting of May 25, 2017, as written. Ayes - 5 - Nays — 0. Abstained — 1 (Melander). PLANNING ESTABLISHMENT OF THE TAX INCREMENT FINANCING (TIF) DISTRICT NO. 18 Community Development Director Bruce Nordquist provided a draft resolution that was prepared by the City's bond counsel for initial actions required for the establishment of a Tax Increment Financing District addressing soil deficiency in the active mining area at Johnny Cake Ridge Road and CSAH 42. An application for TIF resources by Rockport LLC 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. 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 Economic Development Authority City of Apple Valley Dakota County, Minnesota June 22, 2017 Page 2 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, among other findings that must be made. Rockport maintains that TIF will advance development more quickly than a projected 15 to 45 years. 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. The entire approval process is anticipated to take approximately 60-90 days starting with the calling for the public hearing. Tax increment assistance requires a public hearing to form the district. Tax increment, by state law, is also considered a business subsidy. Public hearings are being scheduled for September 28, 2017, for the City and EDA to consider business assistance for the planned tax increment district. Discussion followed. MOTION: of Hamann -Roland, seconded by Hooppaw, recommending that the City Council call a public hearing on the proposed adoption of the proposed establishment of a soil deficiency tax increment financing district No. 18, within the project area established by Special Law. Ayes - 6 - Nays - 0. MOTION: of Hooppaw, seconded by Bergman, adopting Resolution No. EDA 2017-04 calling for a public hearing on the proposed granting of Business Subsidy on September 28, 2017, at 6:00 p.m. Ayes - 6 - Nays - 0. Economic Development Authority City of Apple Valley Dakota County, Minnesota June 22, 2017 Page 3 ADJOURNMENT MOTION: of Hooppaw, seconded by Grendahl, to adjourn. Ayes - 6 - Nays - 0. The meeting was adjourned at 6:39 p.m. Respectfully Submitted, /s/ Joan Murphy Joan Murphy, Department Assistant Approved by the Apple Valley Economic Development Authority on Tom Goodwin, President AppVa��ey ITEM: ECONOMIC DEVELOPMENT AUTHORITY MEETING DATE: SECTION: 4.A. July 27, 2017 Regular Agenda Items Description: Outlot C, Valley Business Park Staff Contact: Thomas Lovelace, City Planner Department / Division: Community Development Department ACTION REQUESTED: 1. Hold a public hearing to consider the sale of real property to Miller Farms of Lakeville, LLC. 2. Adopt the resolution finding that the sale and conveyance of Outlot C, Valley Business Park is in the best interest of the City and accepting the terms of the purchase agreement, and authorize the President and Secretary to sign the necessary documents. SUMMARY: For consideration is a request for approval of a purchase agreement to allow for the sale of Outlot C, Valley Business Park by the Economic Development Authority (EDA) to Miller Farms of Lakeville, LLC. The purpose of this sale is to create an access from the adjacent property located at 5751 150th Street West (CSAH 42) and allow for the installation of utilities to serve the two properties. The 0.18 -acre parcel, legally described as Outlot C, Valley Business Park, is located along the south side of Energy Way, approximately 1/8 -mile west of Pilot Knob Road. The property is currently vacant and if sold to Miller Farms of Lakeville, LLC would be incorporated with a 3.54 -acre parcel currently owned by Miller Farms for the purpose of developing the properties for business park uses. BACKGROUND: In 1994, the Apple Valley Economic Development Authority (EDA) acquired a 28 -acre site generally located northwest of the intersection of Pilot Knob and County Road 42 from L.G.S. Concord/Citizens Utility to facilitate the creation of an industrial business park. This 28 -acre parcel, now called Valley Business Park, was platted in 1999 and is zoned "BP" (Business Park). Immediately to the south of Valley Business Park is a 3.54 -acre unplatted parcel commonly referred to as the Melby farmstead property. When Valley Business Park was platted, a 0.18 - acre outlot, Outlot C, was created to provide the Melby property with access to Energy Way. The Melby property also has access to County Road 42, but will likely lose that access when the property is developed for another use. The Melby property is guided in the Comprehensive Plan for industrial uses and was rezoned from "A" (Agriculture) to "BP" (Business Park) in 2015. In 2012, the Melby property was put up for sale, and the property owner requested the EDA work with them to acquire Outlot C so that their property would be more attractive to a potential user. The property owners did not present an offer for the acquisition of the property. The City Attorney has determined that no appraisal is needed and staff received approval from the EDA to begin negotiations with the Melbys for their acquisition of Outlot C. No sale of the outlot occurred as the result of the action taken by the EDA in 2012. Miller Farms of Lakeville, LLC, has purchased the Melby property and they are negotiating with City staff on the purchase of Outlot C. In order to complete the purchase the Planning Commission must determine that the sale is consistent with the Comprehensive Plan. The purchase of the outlot will help achieve the objectives of the EDA by attracting future development on the Melby property consistent with the Comprehensive Plan and current zoning designations. Also, a portion of a building located in the northwest corner of the Melby property currently encroaches on to Outlot C. Approval of this sale and any combination of the two parcels will rectify this issue. The Planning Commission, at its January 18, 2017, meeting unanimously approved a resolution finding that the disposal/sale of Outlot C, Valley Commercial Park to Miller Farms of Lakeville, LLC, for consolidation with the property located at 5751 150th Street West (CSAH 42) is consistent with the Apple Valley Comprehensive Plan. BUDGET IMPACT: The City's EDA would receive proceeds from the sale of the property and it would become a taxable parcel. ATTACHMENTS: Resolution Exhibit Agreement Background Material Map APPLE VALLEY ECONOMIC DEVELOPMENT AUTHORITY RESOLUTION NO. EDA -17 - RESOLUTION APPROVING LAND SALE TO MILLER FARMS OF LAKEVILLE, LLC WHEREAS, pursuant to Minnesota Statutes Sections 469.090 to 469.108 (the "Act"), the Apple Valley Economic Development Authority (the "EDA") is authorized to sell and convey real property owned by it if it determines that said sale and conveyance are in the best interest of the City of Apple Valley and that the transaction furthers it general plan of economic development; and WHEREAS, pursuant to said Act a public hearing was held before the EDA on July 27, 2017, to consider sale of property legally described as Outlot C, Valley Business Park Dakota County, Minnesota, attached hereto as Exhibit A; and WHEREAS, the EDA considered the facts placed before it at said public hearing concerning the proposed uses allowable under the Comprehensive Plan and Zoning Regulations to which any buyer is limited to establish on the property and the market rate sales price, which must be tendered for it. NOW THEREFORE BE IT RESOLVED by the Board Members of the Apple Valley Economic Development Authority, that the following findings concerning the sale of property are adopted: 1. The EDA received an offer for sale of property legally described as Outlot C, Valley Business Park, Dakota County, Minnesota, attached hereto as Exhibit A. 2. The overall sales price for the property represents the assessed value as determined by the Dakota County Assessor. 3. The proposed use of the property will provide access to a 3.54 -acre parcel located at 5751 150th Street West, and install utilities to serve the two properties, which will lead to future economic development consistent with the City's Comprehensive Plan and Zoning Regulations. 4. The sale of the property to Miller Farms of Lakeville, LLC, for access, utility installation and future development of this property and the property located at 5751 150th Street West is found to be in the best interest of the City. BE IT FURTHER RESOLVED that the attached agreement for land purchase for the property is hereby approved and that the President and Secretary are authorized to execute the necessary documents to effect the sale. ADOPTED this 27th day of July, 2017. Thomas C. Goodwin, President ATTEST: Pamela J. Gackstetter, Secretary 77, DRAWING NUM ij- DRAWING NUMBER PAO.. • DRAWING Cit 0. LU z 1:13 w ..J Car. owl to's, ir 'ad -14,s'a ,-, t4 ▪ L 1±__I fl . a AVM 8 ,,AM:13N3 s .00.0L015, • " '3C.L 3/N'rl 11 FIX 3ru JO / 1, 43 ilJNIJ03 As — — (7•.', s 4-1 .4L • 01 T:1;?:'2.14 M.Z l.OG.611S OD , n—A.3,0:0113 Cr.T.T/ SL . VZ,z9s ti a ; LI; " ,2 .16 m,.n.9s..9s.a,:r • 1 m I .0S -68S 00'9IZ 8 8 )0 VE 3. JO oil 353.1.4,2 C/1 1SY 3 301 AO amen oz VACANT LAND PURCHASE AGREEMENT RECEIVED OF Miller Farms of Lakeville. LLC, a Minnesota limited liability company ("BUYER"). the sum of Five Hundred Dollars (S500.00) by check as earnest money to be deposited upon acceptance of Purchase Agreement by all parties, on or before the next business day after acceptance. in an escrow account o! DCA Title (-Title"). but to be returned to BUYER if Purchase Agreement is not accepted by Apple Valley Economic Development Authority, a public body under the laws of the State of Minnesota (-SELLER"). The earnest money is part payment for the purchase of the property located at: Oudot C. Valle.\ Business Park, Dakota (.'ount.N. Minnesota, P11) 01-81100-00-030 ("Property-), Which SELLER has agreed to sell to BUYER. As -Is, for Ten Thousand Eight Hundred ($10,800.00) Dollars cash on August 31, 2017 (-Date of Closing BUYER CONTINGENCIES: This Purchase Agreement is subject to the following contingencies and if the following contingencies cannot be satisfied or waived. in writing, 1-).\ BUYER by July 31, 2017, this Purchase Agreement shall become null and void and all earnest money shall be refunded to the BUYER. BUYER and SELLER agree to sign a cancellation of the Purchase Agreement in the ex ent the Purchase Agreement becomes null and void: A. BUYER obtaining satisfactory information from the City of Apple Valley of proposed building plans and specifications, if any, at BUYER'S expense. B. BUYER obtaining satisfactory information from the City of Apple Valley of potential subdivision and/or development plans at BUYER'S expense. C. BUYER obtaining at BUYER'S expense, percolation tests which are acceptable to BUYER. D. BUYER obtaining at BUYER'S expense. soil tests v‘hich indicate that the Property may be improved without extraordinary building methods or costs. SELLER grants permission of access to the Property for testing and surveying purposes. If testing will he intrusive. BUYER shall provide advance written notice to SELLER and SELLER may condition approval upon a reasonable bond or cash escrow security. If the parties cannot agree on said bond or cash amount. either party may declare this Agreement null and void. and the earnest money shall be refunded to Buyer. PLEASE NOTE: at NER may incur additional charges improving the Property. including but not limited to: Hook-up and/or access charges. municipal charges, costs for sewer access, stubbing access, water access, park dedication, road acces& utility connection and connecting fees. curb cuts and tree planting charges. To the hest of SELLER'S knowledge, there are no hazardous wastes. abandoned wells, or underground storage tanks, except as herein noted: DEED. Upon performance by BU \TR. SELLER shall deliver a Limited Warranty Deed, conveying title. to the Property, subject to the covenant required under Minnesota Statute 469.105. Subd. 6. TITLE AND EXAMINATION. SELLER shall, within a reasonable time after acceptance of this Agreement, furnish BUYER with a title commitment certified to date including proper searches covering bankruptcies and State and Federal judgments, liens. and levied and pending special assessments. BUYER shall be allowed ten (10) business days after receipt of the title commitment for examination or title and making any objections which shall he made in writing or deemed waived. If any objection is so made SELLER shall have ten (10) business days from receipt of BUYER'S written title objections to notify BUYER of SELLER'S intention to make title insurable within 120 days from SELLER'S receipt of such written objection. If notice is given, payments hereunder required shall be postponed pending insurability of title and within ten (10) days after written notice to BUYER, the parties shall perform this Purchase Agreement according to its terms. If no such notice is given or if notice is given but title is not insurable within the time provided for. this Purchase Agreement shall be null and void, at option of BUYER, neither party shall he liable for damages hereunder to the other and earnest money shall be refunded to BUYER. In that event. BUYER and SELLER agree to sign a cancellation of Purchase Agreement. USE OF PROPERTY. Buyer shall use the Property for the purposes of providing access to Buyer's contiguous property and for the installation of utilities to serve the Property and the Buyer's contiguous property. Buyer may make additional use of the Property, so long as such use is permitted under the applicable zoning ordinance. REAL ESTATE TAXES shall he paid as follows: 13t YER shall pay prorated from day of closing real estate taxes due and pay He in the year of closing. SELLER shall pay prorated to the day of closing real estate taxes due and payable in the year of closing. In the event the closing date is changed. the real estate taxes paid shall. if prorated, be adjusted to the new closing date. SELLER vv arrants taxes due and payable in the year 2017 are non - homestead classification. SELLER makes no representation concerning the amount of real estate taxes subsequent to closing. SPECIAL ASSESSMENTS shalt be paid as follows: SELLER shall pay on or before the date of closing all installments of special assessments certified for payment \\ it h the real estate taxes due and payable in the year of closing. SELLER shall pay on date of closing all other special assessments levied as of the date of closing. SELLER shall provide for payment of special assessments pending as of the date of closing 'or improvements that have been ordered by the City or other governmental assessing authorities. SELLER shall pay into escrow with Title one and one-half times the estimated amount of the assessment. 1.1pon certification of the pending special assessment to a levied assessment, Title shall pay said assessment and refund any escrow, ed overage to the BUYER. If the levied assessment exceeds the escrowed amount. SELLER shall pay the excess amount. SELLER shall pay on date of closing any deferred real estate taxes (i.e. Green Acres, etc.) or special assessments payment of \\ hich is required as a result of the closing of this sale. BUYER shall pay real estate taxes due and payable in the year following closing and thereafter. ACCEPTANCE: BUYFR understands and agrees that this Purchase Agreement is subject to acceptance by SELLER in writing. INSPECTION: BUYER has the right to inspect Property prior to closing. GENERAL WARRANTIES: SELLER WARRANTS THAT Sall R HAS NOT RECEIVED ANY NO FICE FROM ANY GOVERNIVII.,N TAI, Mit HORITY AS 10 VIOLA'FION OF ANY LAW, ORDINANCL OR REGULATION. IF TIIE PROPERTY IS SUBJECT TO RESTRICTIVE COVENANTS, SELLER WARRANTS THAT SELLER HAS NOT RECEIVED ANY NOTICE FROM ANY PERSON OR AUTHORH ,\S 10 A BREACH OF THE COVENANTS. ANY NOTICES RECEIVED BY SELLER WIlI. BE PROVIDED TO BUYER IMMEDIATELY. DEFAULT: If title is insurable or is corrected as pro\ ided herein, and BUYER defaults in any of the agreements herein. SELLER may terminate this Purchase Agreement and pa).ments made hereunder may be retained by SELLER. This provision shall not deprive either BUYER or SELLER of the right to recover damages for a breach of this Agreement or of the right of specific performance of this Agreement, provided this Purchase Agreement is not terminated, and further provided. as to specific performance, such action is commenced within six (6) months after such right of action arises. TIME is OF THE ESSENCE: Time is of the essence in this Purchase Agreement. METHAMPHETAMINE DISCLOSURE: To the hest of SELLERS knowledge, during the time of its okvnership. methamphetamine production has not occurred on the Property. SURVIVAL: SELLER'S warranties shall survive closing. CLOSING COSTS: Closing costs shall be paid according to the usual and customary procedure and responsibility as occurs in Dakota County, Minnesota. ENTIRE AGREEMENT: This Purchase Agreement, any attached exhibits, and any addenda or amendments signed by the parties, shall constitute the entire Agreement between SELLER and BUYER, and supersedes any other written or oral agreements between SELLER and BUYER. Ibis Purchase Agreement can he modified only in writing signed by SELLER and BUYER. POSSESSION: SELLER shall deliver possession of the Property not later than Date of Closing. [RI,MAINING PORTION OF THIS PAGE INTEN I IONAI,I Y 11:1:1 BLANK] SELLER BUYER Apple Valley Economic Development Miller Farms of Lakeville, LLC. Authority. a public body under the laws of a Minnesota limited liability company the State of Minnesota By: Its: Date: By: Its: Date: B eph M. Miller Its: Chief Manager Date: f/ 1THIS PAGE INTENTIONALLY LEFT BLANK' 4846-6014-3946. v. 2 1 MINNESOTA STATUTES 2016 462.356 462.356 PROCEDURE TO EFFECT PLAN: GENERALLY. Subdivision 1. Recommendations for plan execution. Upon the recommendation by the planning agency of the comprehensive municipal plan or sections thereof, the planning agency shall study and propose to the governing body reasonable and practicable means for putting the plan or section of the plan into effect. Subject to the limitations of the following sections, such means include, but are not limited to, zoning regulations, regulations for the subdivision of land, an official map, a program for coordination of the normal public improvements and services of the municipality, urban renewal and a capital improvements program. Subd. 2. Compliance with plan. After a comprehensive municipal plan or section thereof has been recommended by the planning agency and a copy filed with the governing body, no publicly owned interest in real property within the municipality shall be acquired or disposed of, nor shall any capital improvement be authorized by the municipality or special district or agency thereof or any other political subdivision having jurisdiction within the municipality until after the planning agency has reviewed the proposed acquisition, disposal, or capital improvement and reported in writing to the governing body or other special district or agency or political subdivision concerned, its findings as to compliance of the proposed acquisition, disposal or improvement with the comprehensive municipal plan. Failure of the planning agency to report on the proposal within 45 days after such a reference, or such other period as may be designated by the governing body shall be deemed to have satisfied the requirements of this subdivision. The governing body may, by resolution adopted by two-thirds vote dispense with the requirements of this subdivision when in its judgment it finds that the proposed acquisition or disposal of real property or capital improvement has no relationship to the comprehensive municipal plan. History: 1965 c 670 s 6 Copyright © 2016 by the Revisor of Statutes, State of Minnesota. All Rights Reserved. OUTLOT C (EDA Property) and MELBY PROPERTY LOCATION MAP Melby and EDA Properties } Disclaimer: Map and parcel data are believed to be accurate, but accuracy is not guaranteed. This is not a legal document and should not be substituted for a title search,appraisal, survey, or for zoning verification, Dakota County assumes no legal responsibility for the information contained in this data, M a p Scale 1 inch -= 87 feet 1 X82012 Outlot C, Valley Business Park APPLE VALLEY ECONOMIC DEVELOPMENT AUTHORITY PRESENTATION JULY 27, 2017 Outlot C, Valley Business Park Request 1. Hold a public hearing to consider sale of Outlot C, VaIIev Business Park to Miller Farms of Lakeville, LLC 2. Adopt a resolution authorizing the sale of Outlot C, Valley Business Park to Miller Farms of Lakevilte, LLC �we 8/82017 1 Location Map Outlet C 0.18 ac. Valley Business Park Final Plat VALLEY SUSINESS PARK OUtiot C 'i,11Aelby I Property ..r..7.7 . - . 8/8/2017 Outlot C, Valley Business Park Benefits of the Sale • The overall sales price for the property represents the assessed value as determined by the Dakota County Assessor. ▪ The proposed use of the property will provide access to a 3.54 -acre parcel located at 5751 150th Street West, and install utilities to serve the two properties, which will lead to future economic development consistent with the City's Comprehensive Plan and Zoning Regulations. • The sale of the property to Miller Farms of Lakeville, LLC, for access, utility installation and future development of this property and the property located at 5751 150th Street West is found to be in the best interest of the City. Outlot C, Valley Business Park Recommended Action 1. Open the public hearing, take comments, and close the hearing. 2. Adopt the resolution finding that the sale and conveyance of Outlot C, Valley Business Park is in the best interest of the City and accepting the terms of the purchase agreement, and authorize the President and Secretary to sign the necessary documents. 8/8/2017 3 Aerial Map Looking North Aerial Map Looking East 8/8/2017 4 Aerial Map Looking South Aerial Map Looking South 8//21 Aerial Map A 4 ' 8/8/2017 6 AppVa��ey ITEM: ECONOMIC DEVELOPMENT AUTHORITY MEETING DATE: SECTION: 4.B. July 27, 2017 Regular Agenda Items Description: Village Pointe Plaza/Zvago Apple Valley Staff Contact: Kathy Bodmer, Al CP, Planner Department / Division: Community Development Department ACTION REQUESTED: 1. Staff Update on Preparation of Business Subsidy Agreement 2. Continue Public Hearing for Business Subsidy Agreement to August 10, 2017, at 5:30 P.M. or as soon thereafter as possible. SUMMARY: Introduction: The City of Apple Valley applied for and was awarded a Livable Communities Demonstration Account grant of $1,148,639 to off -set the cost of the purchase of the 3.65 - acre property on the southwest corner of Galaxie Ave and 153rd Street West at 7070 - 153rd St W. The funding is intended to help to create a denser mixed-use development form than is typically seen in Apple Valley. It would help to create a neighborhood area that would otherwise not be created under normal market conditions. The grant will not be awarded until the conditions of the grant are fulfilled including the development of the mixed-use residential and commercial project within the triangle area. The development must commence prior to December 31, 2017 and be completed by December 31, 2018. Business Subsidy Agreement: The grant funds will be disbursed to the developer, OneTwoOne, through a business subsidy. The purpose of the business subsidy is to provide financial assistance needed to ensure the development of the triangle property occurs in accordance with the City's vision and to create jobs. The Subsidy Agreement provides the terms and conditions for the disbursement of the LCDA grant funds to OneTwoOne. Staff continues to work with the developer to develop terms that will secure the release of the $1.149 million grant funding for the acquisition of the property. The developer is ready to proceed with the residential component of the project and wishes to receive a disbursement from the grant in order to purchase the property. The terms of the purchase agreement and business subsidy agreement must be structured to ensure that the residential and commercial components of the project are developed in accordance with the City's grant agreement with the Met Council. If the entire project does not move forward in the manner agreed to in the grant, there is a risk that the grant funds would need to be returned to the Met Council. BACKGROUND: N/A BUDGET IMPACT: None identified at this time. The LCDA funds will be used by the Apple Valley EDA and the City to assist the developer with site acquisition. Using a grant to assist with the acquisition of property was also used with the Cobblestone Square Senior Apartments (Dakota County CDA) and Orchard Path Senior Housing (Presbyterian Homes) projects. ATTACHMENTS: Location Map Plan Set VILLAGE POINTE PLAZA/ ZVAGO APPLE VALLEY a) V a) a) 0 GO COOPER ATI E LI ING - CENTRA L ILL' G: �17LR•ni�,•,R C C .o z COOPERATIV ZVAGO COOPERATIVE LIVING - CENTRAL VILLAGE Apple Valley, MN IriNIIIIi �.►�r�i�r�i�r�r�r�r°? << ♦1� ♦f►I�r�r��,�y.� n`fi � I��ikli .+yc cc 3ZOZ•PERATIVE LIVINC MEMla I I�J O� 1111 %,,,,,,,,,,,,, 1 mgauumuNMI ■I 1011. II ,! I I : ; Iii �i � �i I INIMM MIA 11 lumpr co bZLSS NW ',INA elddd M}SPi. 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Valley Artist Rendering [ZVAGO] [one] \ COOPERADVE LIVING ZVAGO COOPERATIVE LIVING - CENTRALVILLAGE wilson A le Valle MN Pers • ective •• • O a 0* 111,• ••• • •• ••• Apple 1, Valley A S'iOu ; problem ddrecied: Dakota County acquired the "triangle" thru foreclosure and assigned an estimated market value of $1,149,000 The City secured a Livable Community Grant in an amount of $1,149,000 to off -set site acquisition of the triangle for development Special Assessments for Central Village improvements total about $1,300,000; to be re -levied on the property after sale Without the grant, the total cost of acquisition is $2,449,000; a prohibitive $15.40/sq. ft. for land and twice the market price AppVa��ey A process to follow: State Statute and EDA policy requires the awarding of a grant to a private developer for site acquisition to be a business subsidy: requires an agreement outlining terms of the subsidy public hearing Legal Counsel is preparing the required agreements The developer, OneTwoOne, agrees in principal with the terms being prepared More time is needed AppVa��ey Development Objectives 1. Fulfill grant requirements: a horizontal mixed use housing/commercial development on the triangle 2. Begin housing construction by October, 2017 3. Begin commercial construction by Spring, 2018 4. Complete all by end of 2018 Ensure the grant is contributed at time of acquisition and secured to ensure both the housing and commercial are completed AppVa��ey Requested action: Continue public hearing already advertised for the Village Pointe Plaza Business Subsidy Agreement to August 10, 2017 at 5:00 p.m. in this chamber ••• •••• .•••• X04# AppVa��ey