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HomeMy WebLinkAbout11-10-08-WS ~ ~HlLLS Approved: December 8, 2008 CITY OF ARDEN HILLS, MINNESOTA CITY COUNCIL WORK SESSION MEETING NOVEMBER 10, 2008 5:00 P.M. - ARDEN HILLS CITY COUNCIL CHAMBERS CALL TO ORDERJROLL CALL Pursuant to due call and notice thereof, Mayor Stanley Harpstead called to order the City Council Work Session meeting at 5 :04 p.m. Present: Mayor Stanley Harpstead; Council Members David Grant, Brenda Holden, Fran Hohnes, and Dave McClung. Absent: None. Also present: City Administrator Ron Moorse; Community Development Director James Lehnhoff; City Planner Meagan Beekman; Steve Bubul, Kennedy Graven; and Stacie Kvilvang, Ehlers & Associates. 1. AGENDA ITEMS A. Special Legislation Stacie KviIvang, Ehlers & Associates presented the City Council with information on the tools available for the City to use once the TCAAP property closes in 2009. She indicated this related to TIP and other financing options. Ms. KviIvang explained that this item was being brought before the City Council now so the City could begin preparation to introduce Special Legislation this legislative session. Ms. KviIvang walked the Council through the redevelopment district process and how the buildings would typically be inspected to meet the blight test. She noted the TCAAP site and the aging structures of the buildings would likely meet the test. Ms. KviIvang indicated the legislature was being asked to categorize TCAAP as a redevelopment district so the cost of undergoing the inspections would not need to be incurred by the City/developer. Ms. KviIvang reviewed additional legislation information with the Council and how it would benefit the City while proceeding with the TCAAP development. Discussion ensued regarding the TIP district that is planned to be created within TCAAP. CounciImember McClung asked if the Council had to include the statement that the City would not create a hazardous substance sub district within the legislation or could it be dropped. ARDEN HILLS CITY COUNCIL WORK SESSION - NOVEMBER 10. 2008 2 Ms. KviIvang indicated this may be useful to the County, school district and legislature to see that the City is not trying to capture 100% the dollars available from the taxing jurisdiction. The goal would be to have the base taxes go back to the other taxing areas. CounciImember McClung questioned if this could be accomplished any other way than through legislation. Ms. KviIvang stated this is one thing that does not have to be included but thought it would be something the city would be interested in. Steve Bubul, Kennedy Graven indicated this would be a political selling point if the Council wanted to proceed. He noted TCAAP was an environmental site and could qualify for a hazardous substance Subdistrict. Mayor Harpstead indicated this may be a good negotiating tool to be offered over time. He stated it may be appropriate to have a resolution of Council that states these wishes. CounciImember McClung agreed with the Mayor's suggestion stating this may be more useful than bogging down the legislation with overly complicated elements. CounciImember Holden questioned if a percentage of the taxes could be used for anything besides remediation. Ms. KviIvang explained with a Hazardous Substance Subdistrict, the City would be allowed to pay for the costs associated with the mitigation and clean up of the site. She noted that once the clean-up costs are paid for, then the Subdistrict would end. Ms. KviIvang indicated the district could be extended by five years to assist the Council with future financing. She explained this would be a decision left to Council but would not have to be done. Mayor Harpstead asked if TIP districts can be modified by legislation once established, and if any were extending to the 30 years. He noted by stating the district is 30 years up front, this would give better knowledge to the taxing authorities as to what to expect. Ms. KviIvang stated this was true and that several communities have extended the term of the district, such as the Medtronic development. Mr. Bubul stated the 30 years is suggested to reduce the risk on the City's end. Ms. KviIvaIig explained the legislation would provide the City the opportUnity to establish a district for 30 years but the development agreement would set the terms and parameters for the assistance. Mayor Harpstead questioned who staff had met with at the House Research Committee and if they noted any red flags with regards to the legislation. ARDEN HILLS CITY COUNCIL WORK SESSION - NOVEMBER 10. 2008 3 Ms. KviIvang noted staff met with Joe Michael and indicated that he did not raise any red flags; he felt TCAAP was a project for which it made sense to establish the district. CounciImember McClung stated he would not be in favor of extending the TIP district beyond what is written in current state legislation. He noted the research shows that shorter TIP districts have proven to be more successful. Mayor Harpstead agreed but indicated he would like to see the Council write this into the front end of the agreements versus adding at the end ifthe City were to need help. CounciImember Holmes questioned what other cities have established successful TIP districts and asked if the legislature was more inclined to be involved with the TCAAP project based on its large scale. Mr. Bubul stated this was a large scale project. He noted the New Brighton Northwest Quadrant project was roughly 300 acres. Mr. Bubul indicated Bumsville would also have a large scale project near the Minnesota River. He explained TCAAP was opting for one district throughout the phasing of the development. Mr. Bubul noted that Joe Michael was in favor of this proposition. CounciImember Holden questioned ifthis legislation had anything to do with grants. Ms. KviIvang felt it was not related but rather showed a commitment by the City and their obligation to provide dollars to the project. CounciImember Grant asked how establishing this district would assist in covering operating costs. Ms. Kvilvang stated it would only help by having a tax exempt parcel become taxable and the City's portion of base taxes that would be generated from the new taxable value CounciImember Grant questioned if staff would be creating a plan to juggle the operating costs. Ms. Kvilvang stated the resource plan would cover this information. Mayor Harpstead questioned if there were any additional questions that should be brought to the City before this item proceeds to legislation and questioned if the Council was in favor of proceeding with implementation of this item as suggested. Ms. KviIvang stated if the Council was in favor that Steve Bubul would draft the legislation, which would be brought back to Council for approval. After that, it would be taken to legislators where revisions may be made and reported back to Council. She noted a bill would then be introduced during the 2009 legislative session. Ms. KviIvang indicated the Council may be asked to testify on behalf of the legislation. She explained if the 30 year district were approved the County and school district would have to approve the legislation as well since it is an extension of a district. ARDEN HILLS CITY COUNCIL WORK SESSION - NOVEMBER 10. 2008 4 Councilmember Holmes asked if Finance Director Iverson has reviewed the TIP recommendations. City Administrator Moorse indicated Ms. Iverson has received a copy of the information but that he has not conversed with her in depth regarding this information. CounciImember Holmes suggested this information be reviewed with Ms. Iverson to determine if she was in favor of proceeding. CounciImember Holden asked who would carry this item at the State level. She expressed concern with proceeding until she knew who would be working with the City to get this item approved. Mayor Hllrpstead stated he spoke with Kate Knuth, and she was comfortable with considering this item seriously. CounciImember Grant questioned if anything was being left out of this document that should be included. Mr. Bubul felt the document was complete and that all items being asked for were due to the long term scale of the project. Mayor Harpstead asked if the document was consistent with the discussions held with the developer. Mr. Bubul stated yes. He also noted that in general TIP law, TIP cannot be used to pay for park or recreation facilities, which was something staff discussed asking for in the special legislation, but determined it was likely it would not be approved. CounciImember Grant noted he was in favor of the item proceeding indicating he felt this would be one way for the City to reduce the overall project risk. CounciImember McClung indicated he was supportive of items 1-4 and that this item should proceed. Mayor Harpstead asked that the item move forward as well. He noted a future discussion would have to be held regarding who would be approached to carry this item forward. It was the consensus of the City Council to direct staff to proceed with the Special Legislation and report back at a future meeting. B. Draft Business Subsidy Policy Stacie KviIvang, Ehlers & Associates reported that in 1999, State legislation required all cities to have a publicly reviewed business subsidy policy. She noted the business subsidies were defined by the legislature to be consistent. Ms. KviIvang indicated business subsidies were anything over $150,000 and came in many forms of assistance. ARDEN HILLS CITY COUNCIL WORK SESSION - NOVEMBER 10.2008 5 Ms. Kvilvang explained the various issues that needed to be defined through the business subsidy policy, including minimum floor for wage, minimum number of job requirements, etc. She noted this document would be useful in working with future developers and to assist in answering questions with regard to how the City operates and to review applications for assistance. Ms. Kvilvang reviewed with the Council a draft business subsidy policy and asked for comments. Mayor Harpstead stated this document excludes TCAAP as stated in Paragraph I. He noted the EDC reviewed this document along with the Financial Planning and Analysis Committee, and Finance Director Iverson. CounciImember Grant asked if a developer meets all the requirements listed within the subsidy plan is the City obligated to provide a subsidy. Ms. KviIvang stated no. CounciImember Holden stated this document was merely a requirement and did not mean the City was going to be providing assistance. Ms. KviIvang noted this began when Chesapeake was looking for potential assistance. She indicated it was better to have something in place with criteria and rules up front, versus scrambling after the fact. CounciImember Holmes questioned ifthe subsidy policy provided was a boiler plate. Ms. K viIvang stated the draft document was boiler plate. CounciImember McClung indicated he felt the business subsidy policy should cover the entire City without excluding TCAAP. He felt the time should be taken to merge the two documents. Councilmember McClung indicated this would reduce the division within the City, by drawing TCAAP into the rest of the City. Mayor Harpstead explained he was not in favor of combining the two documents due to the fact the preliminary developer's agreement references the TCAAP business subsidy policy. He felt this negotiation should be completed before incorporation of the two documents could be taken on. Ms. KviIvang stated she felt it would not be an issue to have only one policy in proceeding with the TCAAP negotiations. CounciImember McClung suggested both policies be reviewed further and combined. Mayor Harpstead suggested the Council proceed with the TCAAP business subsidy policy separate from the proposed business subsidy policy before the Council tonight. He noted the City would operate for a short time with two policies and that they pe merged at a later date. ARDEN HILLS CITY COUNCIL WORK SESSION - NOVEMBER 10. 2008 6 Mr. Bubul noted the draft policy was very broad and generic, which was required by the State. He stated this document could cover the entire City but would not preclude the City from having a separate, specific policy for TCAAP. Mr. Bubul noted the City would still have the ability to review things on a case-by-case basis. Mayor Harpstead noted it would be interesting to review each document in depth and detail to see if one was more limiting than the other. Ms. KviIvaug felt that one policy would be beneficial since both documents were predominantly the same with a few exceptions. She stated the exceptions were items that were either not relevant today or were already covered under the preliminary development agreement. Mayor Harpstead indicated the TCAAP policy greater explained the 26-year redevelopment district with regard to TIP. CounciImember McClung expressed concern with the TCAAP business subsidy policy and how it was originally presented. He stated staff presented it to cover the entire City when first drafted, which was not the case. Mayor Harpstead asked that a fee schedule be referenced and set within the document, which could then be reviewed on an annual basis in Item 8.2 and 8.3. Ms. KviIvang noted the hard fees established would cover staff time with a $10,000 escrow and that it shouldn't be tied to the City's fee schedule. Councilmember McClung asked that EDA be spelled out within the document. Discussion ensued regarding the role of the EDA within the City and how the Council functioned as the EDA. Ms. Kvilvang noted that the two policies would be combined and that they would schedule bringing the Business Subsidy Criteria back to the City Council at a public hearing 2. COUNCIL COMMENTS AND REQUESTS CounciImember Holmes suggested an invitation be sent to Kate Knuth and Senator Satveer Chaudhary to speak with Council for a general discussion. Mayor Harpstead and CounciImember McClung felt this was a great idea and should be held at a future work session meeting. Mayor Harpstead questioned if Northwest Youth and Family Services has broken ground. Councilmember Holden stated they have broke ground and that the fundraising was continuing with a generous gift from Wells Fargo for $50,000. She indicated that they were interested in receiving a resolution of support from the City. ARDEN HILLS CITY COUNCIL WORK SESSION - NOVEMBER 10. 2008 7 Discussion ensued regarding this issue and Mayor Harpstead noted this was not the policy of Council but that he would support a resolution to this organization based on the services they provide to the community. CounciImember Holmes asked if a resolution could be brought to the Council for approval. Mayor Harpstead suggested this proceed and be brought to the Council at a future meeting. CounciImember Holmes indicated Northwest Youth and Family Services will be thrilled by the added support gained from the City. Mayor Harpstead noted he attended a Met Council Regional meeting this morning in White Bear Lake. He indicated Chairman Bell presented the priorities and visions of the Met Council and then asked for comments. Mayor Harpstead indicated the transportation plan was on this list and how there was a need for public transportation east of the Mississippi River. He explained I&I would continue to be pursued. Councilmember Holmes asked that the Council receive a report on the I&I information gathered based on this year's smoke testing. City Administrator Moorse noted he would report back with this information at a future meeting and that the smoke testing did point to several concerns within the City. Further discussion ensued regarding the manhole replacement project. Mayor Harpstead adjourne Council Work Session meetin ;L :11 p.m. Ron J. Moorse City Administrator