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ARDEN HILLS CITY COUNCIL WORK SESSION—DECEMBER 13, 2010 2 2.A Presbyterian Homes Tax Increment Financing Contract(continued) City Administrator Klaers noted the environmental exposure on the site has yet to be determined as staff was not aware that a gas station was located on this site years ago. City Administrator Klaers indicated the Council can proceed with the redevelopment project with a conduit debt issuance fee to be determined at a future date. Another option would be increasing the length of the district or simply stay at a 1% lump sum issuance fee. He explained Presbyterian Homes was present to discuss the issue with the Council. The Council may also retain the 1% lump sum fee and acknowledge that the developer may decline the TIF package. Community Development Director Hutmacher explained she spoke with an environmental consultant and under most scenarios $15,000-25,000 should cover the clean-up and tank removals on the triangle site. If significant contamination were found, the expense would be greater as a site examination would be needed. The City could receive 90% of the clean-up costs returned through the Petrofund program. According to the environmental consultant contacted, the tanks are not included in the County database. Councilmember Grant indicated the residents that have been in the area since the 1940's are aware of the tanks. Mayor Harpstead questioned what the triangle parcel was zoned. City Administrator Klaers stated the site was zoned Neighborhood Business. Mayor Harpstead asked if the City was pursuing grants to cover the clean-up costs for this parcel. City Administrator Klaers indicated this has been discussed. Joe Mehrkens, Presbyterian Homes, explained the environmental remediation expenses are estimated at$25,000. A large portion of these expenses would be reimbursed. Mayor Harpstead questioned if the $25,000 was a maximum or an unreimbursed portion. He indicated if the City were to receive grants, he felt the $25,000 should be an unreimbursed maximum. City Administrator Klaers stated the $25,000 was the cap and a portion of this may be reimbursed. Councilmember Holmes apologized for arriving late this evening. She then questioned if the grants available would be approved. Community Development Director Hutmacher indicated there was a Petrofund grant that could pay 90% of the clean-up costs and the City could also apply to an Abandoned Tank Program. This program did have a waiting list, but this would be kept in mind when applying. She anticipated that the expense would not exceed $50,000, worst case scenario.