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HomeMy WebLinkAbout07/23/1998ECONOMIC DEVELOPMENT AUTHORITY City of Apple Valley Dakota County, Minnesota July 23, 1998 Minutes of the special meeting of the Economic Development Authority of Apple Valley, Dakota County, Minnesota; held July 23rd, 1998, at 7:30 o’clock a.m., at Apple Valley City Hall. PRESENT: Commissioners Edgeton, Erickson, Goodwin, Grendahl, Humphrey, and Sterling. ABSENT: President Severson. Staff members present were: Executive Director Gretz, Secretary Mueller, City Attorney Sheldon, Finance Director Ballenger, Assistant to the City Administrator Grawe, Community Development Director Kelley, and Public Works Director Miranowski. Vice President Sterling called the meeting to order at 7:35 a.m. APPROVAL OF AGENDA MOTION: of Erickson, seconded by Goodwin, ap proving the agenda for today’s meeting as presented. Ayes - 6 - Nays - 0. MINUTES MOTION: of Erickson, seconded by Goodwin, approving the minutes of the special meeting of June 10th, 1998, as written. Ayes - 4 - Nays - 0 (Grendahl and Humphrey Abstained). FISCHER MARKET PLACE Jim O’Meara, the EDA’s Tax Increment Counsel, described proposed amendments to the Tax Increment Financing Plan for District No. 13, including Fischer Market Place. The amendments will describe more particular details in the plan including the type of public improvements, on-site improvements, and County road costs for the development. The County road costs required by the County Board would be paid first. Approval of these amendments do not make a commitment to do any of these projects, that would still require signed agreements with the benefiting parties. The amendments were also approved by the City Council on July 9, 1998. Resolution No. EDA-98-6 MOTION: of Grendahl, seconded by Humphrey, adopting approving Amendments to the Master Development Program and the Tax Increment Financing Plan for Development District No. 13 to allow for Fischer Market Place improvements and stadium facilities at Apple Valley and Eastview High Schools. Ayes - 6 - Nays - 0. Mr. Miranowski said a Redevelopment Assistance Agreement has been prepared for Fischer Market Place following the Board’s direction at its May 28, 1998, meeting. Mr. O’Meara reviewed the details of the agreement as contained in his letter dated July 17, 1998. This ECONOMIC DEVELOPMENT AUTHORITY City of Apple Valley Dakota County, Minnesota July 23, 1998 Page 2 agreement does not specify what development improvements will qualify for on-site cost reimbursement. Those would be subject to further approval for each item. All construction within the district would contribute to tax increment collections, but it would be up to the Board as to what qualifies for payment to the developer. The agreement specifies that on-site costs associated with banking facilities may not be included for reimbursement. Commissioner Humphrey asked how much of the public improvements are for costs the County would normally pay on a project like this? Mr. Miranowski said approximately $400,000. Commissioner Humphrey asked how financial guarantees being required for this project compare with a typical residential subdivision? Mr. Gretz said there is no tax increment financing agreement involved in a residential subdivision. Subdivision agreements do not include a financial guarantee for public improvements and such improvements are assessed over a three-year period. Commissioner Goodwin asked how the Fischer Market Place agreement compares to the Southport tax increment agreement? Mr. O’Meara said the Fischer project is a larger scale, but the agreements are very comparable on a proportionate basis. Resolution No. EDA-98-7 MOTION: of Goodwin, seconded by Edgeton, adopting approving the Redevelopment Assistance Agreement with Fischer Market Place, LLP, to provide tax increment financing assistance in Redevelopment District No. 13, as attached to Mr. O’Meara’s letter dated July 17, 1998, subject to amendment of paragraph 5.1(c) clarifying that events of default apply to this Agreement or the Development Agreement only; and authorizing the President and Secretary to execute the necessary documents. Ayes - 6 - Nays - 0. SCHOOL OF ENVIRONMENTAL STUDIES REFINANCING Steve Mattson, of Juran & Moody, the EDA’s bond consultant, distributed a proposal for recalling and reissuing the bonds issued to finance construction of the School of Environmental Studies for the School District. This proposal was authorized in February, however, market conditions have been such that the four percent savings the School District required has not been able to be realized yet. The sale may be able to be completed today. Resolution No. EDA-98-8 MOTION: of Humphrey, seconded by Erickson, adopting amending and restating Resolution No. EDA-98-2 authorizing issuance of $6,400,000 Public Project Revenue Refunding Bonds (Independent School District No. 196 Lease Obligations) and the execution and delivery of a Supplement to Lease Agreement and a Supplement to Trust Indenture in connection therewith. Ayes - 6 - Nays - 0. PROPERTY TAX LEVY FOR 1999 ECONOMIC DEVELOPMENT AUTHORITY City of Apple Valley Dakota County, Minnesota July 23, 1998 Page 3 Mr. Ballenger reviewed his memo dated July 17, 1998, concerning a proposed property tax levy by the EDA. If the EDA desires to proceed with a tax levy, it must present a budget and make a request to the Council by August 1st. The levy could be used to set up a fund for repayment of the loan on the Concord property, other potential property acquisitions, housing rehabilitation assistance, and revolving loans for other property improvements. The City financed purchase of the Concord property, internally. Interest is accruing to other funds and will have to be repaid. Commissioner Erickson expressed concern about starting to collect a tax levy for an immediate problem, payment for the Concord property, which has the potential for being ongoing. Commissioner Goodwin said this is a major policy shift and he is concerned about proceeding with a levy. Commissioner Edgeton said if the EDA were to levy it should be only for the amount needed for debt service and that need evaluated annually. Commissioner Sterling said she would like to know the amount needed for debt service on the Concord property. Commissioner Erickson concurred and said he would also like to find out whether the funds can be paid to the City’s general fund when the property is sold. MOTION: of Humphrey, seconded by Edgeton, authorizing Staff to prepare a 1999 budget for the Economic Development Authority, including costs associated with the LGS Concord property, and requesting the Apple Valley City Council to levy a property tax, not to exceed the maximum of the proposed budget expenditures, if the budget determines there is a need for such tax levy. Ayes - 4 - Nays - 2 (Grendahl and Sterling). MOTION: of Goodwin, seconded by Grendahl, to adjourn. Ayes - 6 - Nays - 0. The meeting was adjourned at 8:50 o’clock a.m.