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HomeMy WebLinkAbout11/18/1986CITY OF APPLE VALLEY Dakota County, Minnesota November 18, 1986 Minutes of the special meeting of the City Council of Apple Valley, Dakota County, Minnesota, held November 18th, 1986, at 8:00 o'clock p.m. at City Hall. PRESENT: Mayor Branning: Councilmembers Goodwin, Holton, Humphrey and Savanick. ABSENT: None. City staff members present were: City Clerk Mueller, Community Development Director Gretz, and Assistant Administrator Lawell. Mayor Branning called the meeting to order at 7:33 p.m. Mr. James O'Meara, of O'Connor & Hannan, the City's legal counsel, PR DEVELOPMENT distributed copies of a draft First Amendment to Contract for Private COMMONS II Development with PR Development and reviewed it with the Council. He AGREEMENT said this is not his recommendation, but was prepared by him based on the situation as he understands it; that is, to allow payment of $453,000 to PR now and $200,000 upon PR obtaining financing. He does not believe the original idea of tempor- ary transfer of the property to the City, as discussed November 13, 1986, is feasible. This amendment would provide a $200,000 retainage for the City; however, there is a potential of liens on the property if it should be forfeited to the City later. Mayor Branning said the Council is concerned about minimizing risks to the City, but it also wants to be partners in and promote development. Mr. O'Meara said this amendment would be a little less secure for the City than the original contract, but the City has bonded for the money and, whether or not development proceeds, the City will have to repay the bonds. Councilmember Goodwin asked how the $453,000 amount was determined? Mr. O'Meara said it was basically a negotiated figure. Robert Substad, of PR Development, was present and said $200,000 was discussed as security and they need the funds to complete the land purchase and secure financing. Councilmember Humphrey said he was involved in the dis- cussions which began with how much should be set aside to satisfy possible mechanics liens and $200,000 was generally agreed upon. Councilmember Goodwin asked if closing financing in two weeks to 30 days, as stated in Mr. Substad's November 13, 1986, letter is still appropriate? Mr. Substad said yes he believes it is possible. MOTION: of Goodwin, seconded by Holton, to reconsider the Council's November 13, 1986, action amending the "Contract for Private Development" with PR Development. Ayes - 5 - Nays - O. RECONSIDER AMENDMENT RESCIND 11-13-86 AGREEMENT RES. 1986-240 AMEND PR DEV. AGREEMENT MOTION: of Holton, seconded by Humphrey, rescinding the Councilfs action of November 13, 1986, approving an agreement amending the "Contract for Private Development" with PR Development. Ayes - 5 ~ Nays - O. MOTION: of Humphrey, seconded by Branning, adopting Resolution No. 1986-240 approving and authorizing the execution of a First Amendment to the Contract for Private Development dated July 30, 1986, with PR Development as presented November 18, 1986. CITY OF APPLE VALLEY Dakota County, Minnesota November 18, 1986 Page 2 Councilmember Holton said he is concerned about the adequacy of the $200,000 retainage. Councilmember Savanick asked why the land purchase, financing and transfer of funds can't occur at the same time? Councilmember Humphrey said his understanding is the permanent financing is being done by Labor Insurance of Washington, D.C., and it moves slower in its processing than many others. A requirement of the temporary construction financing is that permanent financing must be in place to complete it. ~at has happened is a time element problem causing cash flow problems. Vote was taken on the motion. Ayes ~ 5 - Nays - 0. MOTION: of Savanick, seconded by Holton, to adjourn. Ayes - 5 - Nays - 0. The special meeting was adjourned at 7:59 otclock p.m~ The Council then attended a public hearing, at Apple Valley City Hall, conducted by the Dakota County Highway Department, concerning proposed improvements to County Road 42 between Pennock Avenue and County Road 11 in Burnsville.