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HomeMy WebLinkAboutCC 09-22-1997 (3) . . . MINUTES CITY OF ARDEN HILLS, MINNESOTA SPECIAL CITY COUNCIL MEETING SEPTEMBER 22, 1997 8:45 P.M. - ARMY RESERVE CENTER CALL TO ORDER/ROLL CALL Pursuant to due call and notice thereof, Mayor Dennis Probst called to order the Special City Council meeting at 8:45 p,m, Present: Mayor Dennis Probst; Councilmembers Beverly Aplikowski, Susan Keirn, and Paul Malone, Absent: Councilmember Dale Hicks, Also present were City Administrator, Brian Fritsinger; Community Development Director, Kevin Ringwald; Public Works Superintendent, Dwayne Stafford; Parks & Recreation Director, Cindy Walsh; City Engineer, Greg Stonehouse, City Attorney, Jerry Filla; and Recording Secretary, Cindy Schneider. ADOPT AGENDA MOTION: Keirn moved and Aplikowski seconded a motion to adopt the agenda for the September 22, 1997, Special City Council meeting as presented, The motion carried unanimously (4-0). UNFINISHED AND NEW BUSINESS A. Gateway Business District (GBD) 1. Planning Case #97-06, Planned Unit Development (PUD) Final Plans and Final Plat, Welsh Development Company, LLC Mr. Kevin Ringwald, Community Development Director, gave a brief overview of the case before Council, stating approval is being sought of the PUD Final Plan and Final Plat (including a street vacation) for Phases II - IV of the Gateway Business District project. While there are still a small number of conditions that have not been met, most of the conditions from the July 2, 1997, Planning Commission meeting have been satisfied. Mr. Ringwald further stated Staff has added thirty-one (31) additional conditions that will require Council approval at tonight's meeting, Mr. Ringwald requested Council refer to the "Update" Section of his memo dated September 22, 1997, while he discussed the contents therein, Mr. Ringwald stated Condition #2, which stated that no new development is to be added until Round Lake Road is reconstructed, is being requested to be modified by the applicant's engineer, who states this road could safely handle another 200,000 square feet of additional development at the present time, Therefore, it would be appear to be appropriate to modifY this condition to state: . . . ARDEN HILLS SPECIAL COUNCIL MEETING - SEPTEMBER 22. 1997 2 "No issuance of occupancy permits for that part ofthe project (Phases II, III and IV) greater than 200,000 square feet until such time that the relocated Round Lake Road is open for traffic and capable of accepting increased traffic." Mr. Ringwald stated the site grading has proved hard to "balance" and various grading options are being studied to remedy this problem. The majority of the difficulties are centered on the area near the railroad tracks. Additional easements will be sought from the railroad company to aid in the grading in this location. As a result of the grading, the buildings remain in the same relationship to one another, but have all shifted slightly to the east. The two drainage ponds slated for the area in front of Phases III and IV have been relocated to the Naegele property, directly under the NSP transmission lines, which gives the original area more landscaping opportunities, The City Engineer has studied the proposed relocation and reports that the pond shifting will be able to be completed with no adverse affects, Mr. Ringwald stated basically the changes to the site plan are as follows: the site is being raised by 2 to 3 feet; the buildings are being shifted slightly to the east; Gateway Boulevard is being shifted six (6) feet to the north; and the ponds in Phases II-IV are being relocated. Mayor Probst inquired what the total square footage will be for this site. Mr. Ringwald stated the total square footage is 270,000, divided between the three buildings as 100,000 square feet, 100,000 square feet, and 70,000 square feet. Mr. Ringwald reported tlle Phase IV building will possibly be occupied by a single tenant. Any future expansion of this building will be done at the rear, Also, that the expansion side to the north will be finished as proposed in the final plans, Mr. Ringwald stated that the plans had a typographical error in regard to sign setbacks, and that is being corrected, Mr. Ringwald reported the west driveway onto Gateway Boulevard from Phase II was eliminated, as the increase in the height ofthe site would have made this driveway too steep, The employee/customer parking lot will still have two points of access, one from Gateway Boulevard and one from Round Lake Court, Mayor Probst inquired if a cross-easement existed that allowed cars to travel between buildings without having to re-access 14th Street. Mr. Ringwald replied all access points and circulation are within the property itself, and the access points all exit out onto public right-of-ways, Mr. Ringwald stated the 12-inch water main currently located in 14th Street is being relocated to Gateway Boulevard, The Phase I building is also serviced off of this line, The City feels the water line through Phase II should also be 12-inch to ensure proper water flow, If the applicant can show that Phase II can safety operate on an 8-inch line, then the 8-inch line could remain. . . . ARDEN HILLS SPECIAL COUNCIL MEETING - SEPTEMBER 22. 1997 3 Mr. Ringwald stated Staff had no modifications to Phase II, but proposed modifying Phases III and IV by stepping down the wing wall to improve aesthetics. Mr. Ringwald showed an overhead of the proposed modifications. Mayor Probst asked if these modifications are constructed of the same pre-cast material as the building. Mr. Dick Zehring, Welsh Development Company replied that they were, Mr. Ringwald stated the glass and brick on the front remain the same as originally planned, and the only major change is the stepping down of the wing wall. Mayor Probst inquired if new color boards had been brought to the meeting, Mr. Lynn Sloat, Welsh Development Company, stated they had been brought in for review. Mr. Ringwald reported the revised grading which is being proposed raises the buildings relative to the properties around the site. The two buildings will be above the ground level of the land between the buildings and the lake, However, there is vegetation on the USFWS property and on the conservation easement, which will assist in the screening of the buildings and the truck courtyard between Phases III and IV, Staff is requesting additional screening in the form of evergreen trees be planted in this area. Mayor Probst requested clarification that the site was being raised by 2 feet Mr. Ringwald replied the site was being raised between 2 and 3 feet Mayor Probst inquired if the buildings' visibility would then also be raised by that amount Mr. Ringwald stated that was the case, and suggested some of the trees from the Phase] landscaping could be moved over to further screen the Phase III and IV buildings. Mr. Ringwald stated 22 of the proof-of-parking spaces the applicant is proposing, overlap the ponding easement on Phase IV, and this issue will need to be resolved, Mayor Probst inquired if the docking area was considered a parking area, Mr. Ringwald stated that all of the parking spaces are shown on the plan as parking spaces. Mayor Probst inquired what the parking issues were in this area and further inquired if less warehouse business meant less of a dock/pavement area, Mr. Ringwald stated that was correct and some parking areas can be shifted around to bring this area into compliance. Mayor Probst inquired ifthe parking stalls being counted were within the apron area, Mr. Ringwald stated these stalls were not being counted. Mr. Ringwald stated Staff is requesting the retaining wall in Phase IV be constructed by the developer. ARDEN HILLS SPECIAL COUNCIL MEETING - SEPTEMBER 22 1997 4 . Mr. Ringwald stated the applicant will need to acquire approval of the USFWS before constructing the water outlet as shown on the plans, as the outlet structure is on USFWS property. Mr. Ringwald discussed the objection from Dan Vaughan regarding access to his property, The City has discussed this issue with Naegele, who indicated they are amenable to providing access through their property, The City will be working with Naegele on obtaining access, and Mr. Vaughan on the redevelopment of his property, City Attorney Jerry Filla requested that the proposed right-of~way be shown, Mr. Ringwald displayed an overhead of the area, showing where the access will come in over the sanitary sewer easement and along the southeast border ofthe Welsh property, This access replicates the original access of Mr. Vaughan. Mr. Ringwald stated the conditions that have been met by the applicant have been eliminated from the list of conditions, and that additional conditions have been added by Staff. Mr. Ringwald stated the park dedication issue needs to be addressed and Parks and Recreation Director Cindy Walsh was present at tonight's meeting to do so. . Mr. Ringwald stated the plat would be vacating the existing 14th Street and replicating it with a new right-of-way on the south end of the project Mayor Probst inquired if the elevation of the building would necessitate further street reconstruction costs. Mr, Ringwald stated there would be additional costs associated with this project, and they could be addressed by City Engineer Greg Stonehouse. Mayor Probst stated he is more concerned with the timing of the project in relation to the work still remaining. Mr. Zehring stated AmberJack (the real estate arm of State Farm Insurance) has formally approved the purchase of the Phase II building and have requested that it be ready for occupancy by spring of 1998. The Phase IV building owner has also asked for construction on that building to begin in October. At this time, the plats need to be approved and the mortgages need to be completed to stay on schedule. Over thc winter months, only roads necessary for construction vehicles would be constructed, and bituminous could be laid in spring of 1998, Mayor Probst inquired what action needs to be taken by Council at tonight's meeting, and inquired if the construction contract needs to be approved tonight. Mr, Brian Fritsinger, City Administrator, stated the construction contract will be brought for Council approval at the October 14, 1997 regular City Council meeting, along with approval of the necessary repairs to 14'h Street and approval of bond issuance for this project . Mayor Probst inquired regarding design work for this project Mr. Fritsinger stated Staff is authorizing design work as necessary. . . ARDEN HILLS SPECIAL COUNCIL MEETING - SEPTEMBER 22.1997 5 Mayor Probst inquired regarding the final plat. Mr. Ringwald stated the street vacation and park dedication issues need to be resolved, and the revision of plans as discussed need to be approved. Mayor Probst requested clarification that approval requires a 4/5 majority vote, which would necessitate unanimous Council approval, as one Councilmember is absent from tonight's meeting. Mr. Ringwald stated that was correct. Mr. Zehring inquired if the City wished to discuss the park dedication issues at this point. Mayor Probst stated this was an appropriate time to discuss this issue, Mr. Zehring asked Ms, Cindy Walsh, Park and Recreation Director, to give an overview ofthe Issues. Ms, Walsh stated there is a proposed trail easement along the northern and eastern edge of the property to allow a trail along the border of Round Lake, and to be able to connect the cul-de-sac. The City is requesting cash in lieu of the remaining park dedication, Mr. Zehring gave Council a bench handout, which he had just presented to Ms. Walsh before the meeting, Mr. Zehring is requesting that the wetland easements and conservation easements be subtracted from the total development square footage before calculating the park dedication fee, Mayor Probst inquired if the City would be requesting 10% for fulfillment of this park dedication. Ms. Walsh stated tllat was correct. Mayor Probst requested clarification that the City will be taking the value of the trail. Ms, Walsh stated that was correct. Mayor Probst inquired if the developer was asking for a reduction in park dedication fees based on the wetland and conservation easements. Ms. Walsh stated that was correct. Mr. Zehring stated the soil corrections are costing his company large amounts of money, and stated he is also giving the City a 55,000 square foot conservation easement. He stated he feels it is appropriate for him to provide a trail easement, but does not feel obligated to provide additional funds for wetland dedication, The wetlands should be subtracted from the basic number that the dedication is applied to, Councilmember Malone inquired if the conservation easement has always been a part of the site plan, Mr. Zehring stated Welsh is creating this easement, and this easement has been part of the discussions from the begimling. Councilmember Malone requested clarification that Welsh desires to take a 55,000 conservation easement as the net amount of the park dedication to reduce it's costs, Mr. Zehring stated that was correct. . Councilmember Malone suggested subtracting the trail from the net cost and the conservation easement taken out, as it is not considered part of park dedication. ARDEN HILLS SPECIAL COUNCIL MEETING - SEPTEMBER 22. 1997 6 . Mayor Probst suggested construction of the trail by Welsh could eliminate park dedication fees, Mr, Zehring stated that was a possible solution, but he would need to know the final amount of the park dedication and the trail construction first Mayor Probst inquired if the scenario set forth by Councilmember Malone was amenable to Mr. Zehring, Mr. Zehring stated he was not able to make this decision immediately, but that it seems to be a satisfactory arrangement Mayor Probst stated for clarification that the park dedication would be calculated based on the removal of the conservation easement and the wetland easement Mr. Zehring stated he has reviewed Exhibit D for the first time today, Mayor Probst inquired if the park dedication fee issue had to be resolved tonight for this project to move forward. Mr. Zehring replied this issue could be discussed further without delaying construction, Ms, Walsh requested direction from Council on the park dedication fee issue. Mayor Probst requested Ms. Walsh research options for Welsh to construct the trail in lieu of a cash payment for park dedication. . Mr. Zehring requested the final amount be between $25,000 - $68,000, Mayor Probst suggested adding an additional condition stating approval based on agreement of the park dedication fee amount Mr. Ringwald stated further actions for this project will come before Council on October 14th or possibly on September 29t\ and this issue could be discussed further at that point Councilmember Malone noted if the railroad company will not agree to an easement for the slope, the project could be in trouble, He further suggested that if the Fire Department does not provide addresses for the buildings in a timely manner, that the City provide them, Mr. Ringwald asked for direction on how Condition #16 should be rewritten, or ifit should be struck. Councilmember Malone suggested "Approval of Development Agreements Prior to Final Plat", Mr, Ringwald suggested "Execution of Development Agreement Prior to Approval of Final Plat" and striking "by City Council". Mayor Probst asked for suggestions on language for Condition #18. Mr. Ringwald suggested striking "by Fire Chief', Mr. Ringwald further stated the Planning Commission's main concern was that the addresses are able to be seen clearly from the street. . Mayor Probst suggested the addition of Condition #32, subject to approval of park dedication fees. . . . ARDEN HILLS SPECIAL COUNCIL MEETING - SEPTEMBER 22. 1997 7 MOTION: Malone moved and Keim seconded a motion to approve the Final Plans and Final Plat for Welsh Development Company, subject to the thirty-one (31) recommendations as indicated with the following changes: #16 add "approval of development agrcements prior to final plat", # 18 "approval of address by building official" and the addition of #32, "Park dedication to be resolved prior to issuance of building permit." Mayor Probst inquired whether an amendment should be added to address the vacation of 14th Street. Coullcilmember Malone accepted the amendment. The motion carried unanimously (4-0), 2. Purchase aud Sale Agreement, CitylWelsh Development Company, LLC Mr. Fritsinger stated the City has been negotiating for the past two years on development of the Gateway Business District, The developer has been in the process of obtaining rights of ownership to several parcels of property within the GBD, The subject property included in the attached Purchase and Sale Agreement includes several pieces of property, the largest of which is the former Kem Milling rendering plant, now owned by the City. There is also some property that needs to be acquired from Naegele that abuts the Phase II building, and Naegele is in the final stages of reviewing purchase agreements for this property, Mr. Fritsinger stated the purchase price for the Kem MilIing property is $408,640. The remaining $82,255 is to be forgiven and credited to the developer as a result of consideration for wetland mitigation being undertaken by the developer. The developer has indicated that he would like to receive reimbursement for several costs which, if approved by the City Council, affect the tinal sale price. These items include: Removal of Kem Milling foundation Removal of gas piping Removal of water main piping $61,405 $ 4,060 $ 8,210 Mr. Fritsinger stated the foundation was not removed when the Kem MilIing site was demolished, as it was not known at that time how the property would be developed in the future, Staff is attempting to receive a lower bid for this removal. Mr. Fritsinger stated the gas piping in question was thought to have been removed by the Federal government, as it is related to TCAAP gas lines and further suggested it may be appropriate for the City to consider paying for the costs of its removal. Me. Fritsinger stated the water main piping removal could also be paid for by the City, Mr. Fritsinger reported some design issues and some wetland issues have not yet been resolved, and no firm amounts are known at this time regarding those issues. The Naegele property, however, is expected to be acquired at the regular City Council meeting on September 29th. . . . ARDEN HILLS SPECIAL COUNCIL MEETING - SEPTEMBER 22. 1997 8 Mayor Probst requested clarification that approval of the Purchase and Sale Agreement assumes that the City will pay the above-listed additional costs. Mr. Fritsinger stated he is seeking Council direction on these issues, Mayor Probst inquired as the wetland mitigation is now being relocated with the changes to 14tb Street, and what becomes of the $85,000 credit. Mr. Ringwald stated the developer would be paying the additional costs of increasing the pond in the 14tb Street area. Mr. Ringwald stated as the City is paying the costs of raising the street, the developer should pay for the additional ponding in this area. Mayor Probst inquired if language changes were necessary, Mr. Fritsinger stated the changes would be non-substantial. Mayor Probst requested clarification that the purchase price would be $323,385 with the understanding that the developer would pay the additional costs, Mr. Filla stated this would be considered a substantial change, as the purchase price will change significantly. Mr. Zehring stated this is the first time he has heard of this particular arrangement. He stated his company has budgeted $325,000, and they are already experiencing budget problems due to the soil corrections and additional easements. The grading costs are not reflected in the budgeted amount. Mayor Probst stated the original agreement was for the developer to accommodate the City's ponding needs, but with the regrading of the street, this has changed, Mr. Fritsinger stated at the last two meetings with Mr. Zehring, it was pointed out that the final costs had not yet been determined, Mayor Probst suggested that the City pay for the removal of the foundation and piping, but that the square foot nwnbers will have to be recalculated for the pro forma. Mr. Fritsinger stated he could recalculate the figures, but it would require a short amount of time to do so. Mayor Probst stated this would need to be done immediately for an agreement to be reached, Mr. F ritsinger recalculated the figures, and the meeting reswned, Mr. Fritsinger stated the additional costs for l4tb Street and the ponding could be considered part of the infrastructure improvements necessary to make the project feasible. The City had initially indicated it would use tax increment financing (TIF) to cover the costs of similar improvements, If the Council believed these costs were consistent with this position, it would not be out ofline to use TIF to cover the costs, Mayor Probst requested clarification that any additional costs could be covered by the TIF monies being generated from the project. Mr. Fritsinger stated that appears to be correct. ARDEN HILLS SPECIAL COUNCIL MEETING - SEPTEMBER 22. 1997 9 . Councilmember Malone inquired how many square feet are involved. Mr. Ringwald stated approximately 295,000, or 6,75 acres. Council member Malone requested clarification that the reduction in the sale price is recoverable through TIF, Mr. Fritsinger stated that was correct. Councilmember Malone inquired if the amount would be in excess of the bonds being issued, Mr. Fritsinger stated it would not be. Mayor Probst inquired if the developer was willing to subtract $73,000 from the purchase price of$323,385. He stated his concern with the asswnption of wetland mitigation. Mr. Fritsinger stated the developer was to receive an $85,000 credit because the wetland mitigation would also benefit the City. The City cannot incur these additional costs if this wetland mitigation does not happen, Mr. Zehring inquired ifthe price of the City land is relative to the price of the other parcels, When the site was raised and the other sites acquired, the additional $85,000 was not anticipated, He stated he either did not hear or did not understand this issue stated at previous meetings, . Mayor Probst stated the reason for the $85,000 credit was that the City would receive the benefit of extra drainage, which will not be taking place now, Council member Aplikowski inquired if the developer wished to change the $85,000 to $73,000. Mr. Ringwald stated the entire $85,000 cannot be eliminated but, perhaps, one-half can be, The storm sewer issues are part of this money, and the wetland issues are not going to change. Mr. Fritsinger stated the issues of 14th Street and the wetlands have not yet been resolved, Mr. Ringwald stated meeting the incremental costs such as easements should be the developer's responsibility because of the cost savings on the grading, Mayor Probst inquired what the value of the developable land was, Mr. Ringwald stated Mr. Stonehouse was still researching this issue, Mayor Probst stated an agreement must be reached at tonight's meeting regarding the sale price. Mr. Fritsinger suggested a short recess. Mayor Probst called a recess at 10:05 p.m. Mayor Probst reconvened the meeting at 10:24 p,m, . Mr. Fritsinger stated he had reviewed the purchase price, and had concluded that the price the developer is paying for the adjoining properties - $320,000 - is in line with the price of the other ARDEN HILLS SPECIAL COUNCIL MEETING - SEPTEMBER 22. 1997 10 . properties within the Gateway Business District. The preparation of the site (removal of foundation and pipes) will be the City's responsibility, Regarding the relocation of the ponds and the wetland issues, he suggested applying the costs to the assessments related to public improvements, and TIF could pay for the costs of the wetland, The City will be using TIF to make the project take place, by which the wetlands could be considered improvement of public property, which is allowable under TIF rules, TIle additional costs for the street elevations are approximately $180,000, which may also be able to be considered public improvements, This cost can be discussed further during the approval process for the development agreement. Mr. Fritsinger inquired if Council would approve of putting the additional $85,000 under the assessment agreement, and using TIF funds, Mayor Probst requested clarification that the 14th Street project costs were $180,000, Mr. Fritsinger stated that was correct Mayor Probst inquired if this anlount also included the wetland mitigation. Mr. Stonehouse stated it does not, nor does it include the acquisition price of the neighboring properties, Councilmember Malone requested clarification that $73,675 would be subtracted from the $323,385 purchase price, Mr. Fritsinger stated that was correct. . Councilmember Malone requested clarification that the City would be setting aside the costs of the wetland mitigation and the street improvements, and funneling the costs through TIF. Mr. Fritsinger stated that was correct Councilmember Malone inquired if the TIF stream was sufficient to cover these costs. Mr, Fritsinger stated it appears to be. Mayor Probst inquired regarding the amount ofthe outstanding balance on the Kern Milling site. Mr. Ringwald replied approximately $325,000, Mayor Probst inquired if the remaining $75,000 will be left on the books with no revenue stream, Mr, Fritsinger stated that was correct. Mayor Probst inquired if this cost would be paid through a different line item, Councilmember Malone noted that the Kern Milling site would receive between $30,000-40,000 ofTIF funds, and the City would cover the remaining costs in approximately two years. Councilmember Aplikowski requested clarification that the purchase price will be reduced to approximately $249,710. Mr. Ringwald stated that was correct. . Councilmember Malone inquired who will be removing the foundation, Mr. Fritsinger stated the bid was from a contractor employed by the developer. Mr. Ringwald added the City is attempting to receive a lower bid for this work, . . . ARDEN HILLS SPECIAL COUNCIL MEETING - SEPTEMBER 22. 1997 11 MOTION: Malone moved and Aplikowski seconded a motion to approve the Purchase and Sale Agreement for the sale of property to Welsh Development Company, LLC in the amount of $249,700, substantially in the form presented, subject to nonsubstantial changes being approved by the City's Development Attorney and City Administrator; authorize the Mayor and City Administrator to execute all necessary documentation; and subject to approval and execution of the Sale and Purchase Agreement with Naegele Outdoor Advertising, Inc, and approval and execution of the Development Agreement between the City of Arden Hills and Welsh Development Company, LLC. Further discussion ensued. The motion carried unanimously (4-0). ADJOURN MOTION: Keirn moved and Aplikowski seconded a motion to adjourn the meeting at 10:40 p.m, The motion carried unanimously (4-0), Rri,:ill- City Administrator