HomeMy WebLinkAbout2019-10-09 CC Minutes - Approved
CITY OF CENTERVILLE
CITY COUNCIL MEETING
October 9, 2019
6:30 p.m.
Pursuant to due call and notice thereof, the City of Centerville held a regularly scheduled City
Council Meeting on October 9, 2019 at City Hall, 1880 Main Street.
COUNCIL
I. CALL TO ORDER
Mayor Paar called the meeting to order at 6:30 p.m.
ROLL CALL
PRESENT: Mayor Jeff Paar
Council Member Russ Koski
Council Member D. Love
Council Member Matt Montain
ABSENT: Council Member Michelle Lakso
STAFF: City Administrator Mark Statz
City Attorney Kurt Glaser
Finance Director Bruce DeJong
Mayor Paar wished Council Member Lakso a speedy recovery following surgery.
II. PLEDGE OF ALLEGIANCE
III. APPROVAL OF
Mayor Paar provided an opportunity for others to add or delete any items.
Motion by Council Member Montain, seconded by Council Member Love to Approve the
Agenda as Presented. All in favor. Motion carried.
I. APPOINTMENTS/PRESENTATIONS
1. None.
V. PUBLIC HEARING
1. Block 7 – Housing Tax Increment Financing District (TIF)
City Administer stated that by law a public hearing is needed to establish a Tax Increment
Financing District (TIF) with the County and school receiving written notice along with
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October 9, 2019
legal publication and both were complete. He introduced Ms. Tammy Omdal, Northland
Securities to the Council.
Ms. Omdal stated that no comments had been received from either Anoka County or the
Centennial School District regarding the draft TIF plan and she stated that neither of the
entities may prevent the creation of a TIF district. She also stated that the reason for the
TIF District is that the City received a proposal for the construction of a 53 unit apartment
building along with a small amount of commercial space within the same building to be
located on Block 7 of the downtown area. Several developers proposed construction of the
site; however, Trident Development, Inc. was chosen by the Council to complete the
project. Trident Development requested the utilization of TIF for the project as they felt
the project would not be viable without it due to the high costs of high-quality low to
moderate-income housing and associated infrastructure required to support the facility.
The developer also felt that without the assistance the initial up-front costs it would not be
feasible for them to be able to charge the affordable rents required for low-to moderate-
income residents required due to the City’s original purchase of the properties with
Community Development Block Grant (CDBG) funds and the TIF requirements of
providing at least 11 rental units which met the minimum of 20% of the rental units being
affordable to persons at 50% or less of the area median gross income ($50,000 for a family
of four). She stated that this met Minnesota law for this TIF district and the requirement
of CDBG regulations. She also stated that rates charged would be a studio apartment
(affordable - $875 and market rate - $1,100); 1-bedroom (affordable - $937 and market rate
- $1,500); and 2-bedroom (affordable - $1,125 and market rate $1,775).
Ms. Omdal explained the processes associated with the establishment of a TIF district and
stated that the first item that needed to be adopted was a Tax Increment Financing Plan for
the TIF District which provides information about the Project and authorizes the use of tax
increment from the district to pay TIF project costs and other items. She explained that a
tax increment financing district must be established by the City and within the boundaries
of a Development District or project area. She stated that this was previously completed
by the City with set boundaries of the District being contiguous with the boundaries of the
City. She stated that the current Development Program Plan needed to be amended taking
in to account the objectives for this Development District. She stated that the TIF plan and
the Development Program may be written into the same plan but they are two (2) separate
plans. She also stated that following the establishment of the TIF District a development
(TIF) agreement with the developer may be considered by Council.
Ms. Omdal stated that TIF District 1-8 is a housing district which must meet statutory
requirements of the 20% of the units being leased to persons at 50% of the area median
income and contains eight (8) parcels which would be platted into one by the developer
once purchased by them. She stated that the TIF plan would provide $1.35 million of
project costs incurred by the developer to be reimbursed over a period of 20 years solely
from tax increment generated. She reported that it is estimated that the market value of the
property following development would be $6.36 million which is less than the developer’s
total preliminary estimated construction cost of $10.15 million. She reported that this is
typical of similar types of projects. She also stated that being that the property is currently
owned by the City it is tax exempt and not generating property taxes. She also stated that
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it is estimated that the annual tax increment revenue of $100,189 would be within the first
year or upon completion of the development. She said that this figure is calculated by the
following factors: the estimated market value after completion, classification of the
property being 4a (market-rate apartments), the net capacity value of the TIF District being
set based on the current market value of the property for taxes payable in 2019 (property’s
taxable market value multiplied by the relevant class rate set by state statute). Ms. Omdal
stated that for the reports the estimated local tax rate of 134.74% in the TIF Plan is based
on tax rates for taxes payable in 2019, includes the City, County, School and other taxing
jurisdictions tax rates pursuant to the provisions in the TIF Act and is used to estimate
future tax increments. Once requested to certify the TIF District, the County Auditor is
anticipated to utilize the local tax rate for taxes payable in 2020 due to timing. She also
stated that the actual estimated market value of the property will be set by the Assessor
upon completion of construction.
She reviewed the estimated project costs of $350,000 for the land; $33,840 for construction
of affordable housing; $350,160 for improvements related to adjacent public streets, trail
re-route/extension, public boulevard improvements; and utilities $616,000. She stated that
the City has the right to reserve 10% of the increment to reimburse itself for administrative
expenses but may agree to a lesser amount of 5%, reimbursement of project costs would
be on a pay-go basis which is bonded indebtedness and not the same as a General
Obligation Bond. She said that the City could loan or advance money from its General
Fund or any other fund to finance administrative costs associated with the TIF District to
reimburse itself with a portion of the tax increments collected. She stated that the plan
provides for up to $70,967 in these costs. She reported that the duration of the TIF District
could be 26 years but staff is recommending 20. She also stated that the estimated first
receipt of tax increment would be July, 2022 and would end December 31, 2041.
Ultimately, the base-line conclusion of Ms. Omdal’s analysis is that but for this financial
assistance, this project would not go forward. This finding is a necessary prerequisite for
the establishment of the TIF District.
Council Member Love questioned the maximum amount the City would have to pay would
be $1.35 million and the 20 year period and whether that was an either or whichever comes
first. Ms. Omdal stated that there is not yet an agreement with the developer but that is the
planning number. If it were to go forward as planned, the City would agree to pay $1.35
million of actual project costs from 95% of the tax increment generated and if everything
went as outlined in plan which she stated it would not, it would take 20 years to reimburse
the developer. If the increment is more than $100,189 per year you would pay it off sooner
and decertify the district earlier. She stated that if the increment is less, the City would not
pay the developer more than collected and the City would not exceed the 20 years per the
agreement. She also stated that City would not be obligated to pay more than collected.
He also questioned the “area wide” regarding median income. Ms. Omdal stated the rates
are published by the Federal Government, published by area annually and the metro area
is $100,000 and each year it changes.
Finance Director DeJong stated it is called the Standard Metropolitan Statistical Area or
the 7-county metro area.
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Council Member Koski stated that part of the costs of the developer are offset by the TIF
which include interest on a loan. Ms. Omdal stated that the $1.35 million of project costs
would be paid over time (20 years) subject to negotiation as planned, with interest. Council
Member Koski stated that TIF is very complicated and a TIF district is for a blighted or
redevelopment area. Ms. Omdal stated that this TIF District is solely for housing.
Administrator Statz stated that previously the City looked at establishing a TIF
Redevelopment District which had no requirements for affordable housing but did have
requirements for removal of blight. Since this project does not remove blight it would not
it would not qualify as a Redevelopment District. He stated that removal of the buildings
on the vacant lots was covered with CDBG funds several years prior.
Council Member Koski questioned if the developer were to default on the project, how it
would affect the TIF District and the City. Ms. Omdal stated if the project were built, the
developer went bankrupt, stops making property tax payments, no money would be
generated and they would be in default of their contact which then would be terminated.
At some point the City would receive the taxes on the property and would not be held
responsible for paying that developer on the $1.35 million.
Council Member Koski questioned if the developer when bankrupt could the project turn
into something different or was there a maximum number of affordable units. Ms. Omdal
stated that the developer is not proposing more than the 11 units unless the City were to
direct otherwise and typically we see those in studio and 1-bedroom apartments. Council
Member Koski stated that that is his concern. City Administrator stated that if there were
more than 11 units and if they chose to discount more they would not receive more from
the City. He stated that he did not feel that this would make a lot of sense. Council Member
Koski stated that he does not want to be stuck with something that was not intended and it
should be considered. He also questioned that over the 20 year period the City
portion/contribution would be $997,579, the County portion $617,692, the school’s portion
$624,479 and other taxing authorities’ portion $98,641 for a total of $2,338,391 captured
and given to the developer. Ms. Omdal stated that these are estimated captured taxes.
Administrator Statz clarified by stating the $1.35 million is the present value. Ms. Omdal
stated that if the Council finds that the project would go forward without TIF assistance
then those dollars would go to the City and respective taxing authorities. But if not going
forward without assistance then this is a projection of what would happen. Administrator
Statz stated that the largest question is whether the project would go forward without
assistance. Council Member Koski questioned how many other developers were interested
in the project. City Administrator Statz stated that he felt there were four (4) to begin with
and then two (2) that were very interested and Council chose Trident Development who
requested TIF and the other developer had not discussed TIF. Council Member Koski felt
it would be nice to have a developer that did not request TIF assistance.
Council Member Montain stated that he is not for TIF assistance and questioned whether
the 5% could be adjusted to offset taxes/services that will be utilized by these residents
over the 20 year period such as school needs of residents and public safety necessities. Ms.
Omdal stated that the 5% is to offset City administration and nothing else. She also stated
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that the City could capture less than 100% allowing the City and other taxing authorities to
receive more funds than projected in the plan to cover the additional expenditures. She
stated that this would then be less increment to go to the developer if that was agreed upon.
Administrator Statz stated that there were two (2) choices, offer less TIF and keep the 20
year duration of the district or offer the $1.35 million for a lengthier period of time. He
stated that the desire was to reduce the duration of the TIF District so staff recommended
5% rather than the 10% which reduced it from 26 years to 20 years.
Mayor Paar stated that the City owns the property and the Council in general have had
concerns regarding TIF and is the project going to happen without this assistance. He
stated numerous years ago there was an agreement with the Beard Group for a project in
the area and if the property had been developed seventeen years ago utilizing TIF it would
nearly be decertified and complete. He also stated that twenty (20) years is a lengthy period
of time, he understands that the developer is in business to make money and discussions
have taken place regarding offering to waive fees, give the property, etc. in an attempt to
reduce the amount of assistance the developer is requesting and shorten the length of the
District. He requested that Finance Director DeJong speak to this issue.
Finance Director DeJong stated that if the City were to provide incentives, they would not
be taking advantage of utilizing the other taxing authorities’ captured tax dollars and incur
all expenses.
Mayor Paar questioned whether the dollar amount of rent affected the length of the District.
Ms. Omdal stated that rent does not always cause the taxable market value to increase as
operating expenditures may also offset the rent. She stated that there is a relationship
between the two. She also stated that if the taxable market rate were to increase faster than
projected during the 20 year period it would shorten the length of the District. Mayor Paar
asked if the reverse would also have an effect on what was paid to the developer over the
period of the District. Administrator Statz stated that the City would only pay what is
collected over the period of the District (20 years) and the City is protected in that respect.
He also stated that not all units will be rented immediately and that growth rate of the
valuation is part of the assumption. He requested that Ms. Omdal review the assumptions
of the plan. Ms. Omdal stated that for purposes of the plan the taxable value was increased
annually by 1.5% annually over the 20 years, assumed tax rate of 134.7% for 2019 and if
that rate is higher the additional taxes collected would be the taxing jurisdictions and not
payable to the developer and the plan assumes capturing 100% of the taxes and do
something different. She stated that she did not believe that the developer would agree to
that. She also stated that the present value of $1.4 million assuming a 5% interest rate over
the term of future cash flow and 53 units and $120,000 would be $6.5 million but the
assessor would be placing this value and may be different.
Mayor Paar stated that the City needs more commercial and the only thing that will gain
commercial development is households and population growth. He stated the growth is for
retail and governmental funding. He stated that TIF is his least favorable option and was
disappointed that the developer was not at the meeting. He questioned Administrator Statz
whether discussions have taken place with the developer regarding alternative options.
Administrator Statz stated that several discussions have been had and staff has reviewed
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several other options submitted by Ms. Omdal. He stated that staff felt that this was the
best option and the developer concurred that it was enough incentive to make this work
financial. He also stated that it minimized what the City would give up by discounting the
land or forgiving fees. He reported that staff reviewed four (4) separate options and felt
that this TIF was the most advantageous for both parties.
Council Member Love questioned whether the City would give the land and forgive the
Sewer and Water Availability Charges would that be enough incentive. Administrator
Statz confirmed with Ms. Omdal that at Present Value the City is offering $1.35 million.
Council Member Love stated that forgiving the purchase of the land and other fees would
not be enough.
Mayor Paar thanked Ms. Omdal for her presentation and review.
Motion by Council Member Love, seconded by Council Member Koski to open the
public hearing at 7:18 p.m. All in favor. Motion carried.
Mayor Paar questioned whether anyone in the audience desired to speak on the matter and
if so to state their name and address clearly at the podium.
Ms. Melanie Nicks, 7029 Centerville Road, stated that she would not have moved here 17
years ago if there were an apartment complex constructed on the site. She also stated that
she believed that her neighbors would not have either. She stated that the TIF was an
extremely complex issue to understand, questioned whether the Council consideration of
the issue could be made more public and hoped that it was not diverting taxpayer dollars
to pay for the building that neighboring residents did not desire. City Administrator Statz
stated that nothing had been planned to simplify the understanding of the TIF District for
the public but the City could. He reported that the TIF does not take existing taxpayer
dollars but takes the developers taxes to be reimbursed back to them to offset allowable
costs associated with the construction of the building up to $1.35 million or 20 years, the
term of the contract. He stated that the largest mental hurdle to overcome is the question
of “but for” this project assistance, the project would not go forward and those taxes would
never have been paid. Without the building there he would not owe those taxes.
Ms. Nicks stated that 53 families would be moving in and a lot of people in that small
space, parking, transportation and not the tax equivalent of 53 people. Administrator Statz
stated that there are additional costs but many basic services fees would be paid like anyone
else (water, sewer, garbage, etc.) and are based on user fees so there would be no break to
the developer. We ask that the developer pay the cost of the land and hookup fees for
sewer and water fees up front and same would be reimbursed at a later date. Ms. Nicks
questioned the parking. Administrator Statz stated that parking is paid for by the developer
on the site for the tenants and it would be reimbursable costs of the building. He did state
that the downtown street project does include some on-street parking spaces.
Ms. Nicks questioned the possibility of this development falling through. She also
questioned the status of the Bayview Villas development and whether something bad
happened there.
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Mayor Paar stated that with every development there are snags, staff worked diligently to
obtain/retain the 18 high-end townhomes. He stated that Council and Staff are diligent on
working with developers to complete projects and that will continue. He also stated that
there have been multiple articles on the web site/newsletter, etc. regarding the downtown
area, proposed apartment building and TIF. He questioned whether Ms. Nicks had seen
the proposed design or quality of the building. He stated that the proposed rent for a two
(2) bedroom apartment is more than his monthly mortgage payment and that his son who
earns approximately $45,000/year and attends school would appreciate an opportunity for
housing similar to this.
Mayor Paar stated that he has concerns regarding the TIF portion and felt that no decisions
would be made this evening as Council Member Lakso was not present. Mayor Paar stated
that this design does not bother him and he would move into Centerville.
Ms. Nicks stated that none of the closest residents to the development desire for it to be
constructed. She stated that this evening’s meeting was posted on Next Door and she is
surprised and disappointed that no other neighbors are in attendance this evening. Mayor
Paar stated that City Administrator Statz is readily accessible to discuss any issue along
with the Mayor. Mayor Paar gave Ms. Nicks credit for attending this evening and speaking
about the issue. He stated that he appreciates the time of the residents and speaking in
public. Ms. Nicks was asked whether she had seen a depiction of the proposed building.
City Administrator Statz provided the audience with a previously submitted rendering by
Trident Development months ago.
Ms. Katie DuFault, 7045 Centerville Road, stated that the City’s website states that the
City is a strong community, community of friends and neighbors, honors history and
heritage with a population of approximately 3,700. She stated that the median age is
approximately 37.5 with 1,300 homes and a median household income of $98,000 per the
Census Bureau. She compared statistics from the Cities of Hugo and White Bear Lake.
She questioned why an apartment complex was needed to provide income assistance when
the community is young families with incomes of approximately $100,000/year. She stated
that she did not feel that there was a need to help people who make $50,000/year and stated
that Centerville is not a Stillwater or Minneapolis, not a hip spot or to buy antiques or go
clubbing. She stated that she did not believe that Centerville would attract recent graduates
from the U of M to rent apartments. She questioned whether there was a market survey
completed on the need for an apartment complex. Are there people calling the City
regarding rental properties or home buying and the difficulties of find something suitable
or did the developer come to the City with this specific project with the assistance of TIF
and to get it off the City’s hands the City is saying this is great, let’s do it. City
Administrator Statz stated that the developer completed a detailed market analysis that was
very site specific and that is why we chose Trident Development over the other proposals.
Ms. DuFault questioned patio homes. Mayor Paar stated that with the Beard Group that
was completed, but the market now shows that millennials desire to rent versus own. He
also stated that with the previously proposed senior living for Waterworks, they could not
pre-sell the amount of required units to warrant the project.
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Discussion ensued regarding the commercial component on the lower level, not looking
“cookie-cutter” apartments of the 60’s-70’s, population levels of 5,000 for funding through
the state government for infrastructure and roadways, 11 units being affordable rather than
subsidized, marketing to seniors, millennials or etc. Administrator Statz stated that the
difference in affordable rent is approximately $600/month.
Ms. DuFault stated that she lives across the street from the development, if this were you
how is this advantageous to have across the street from me. If you were me, how is this in
my best interest, where is the green space and parking lot and it is a very small lot. If in
10 years from now, you drive past it, would you find this development something to be
proud of? She questioned the retail plan and whether they have indicated what would go
there. She stated that what was brought up at the Planning & Zoning Commission was
taxes are too high and people don’t move here for the taxes they move here for the schools
and small town feel and safety. Is there something in the works or is it the zoning or just
the space. Mayor Paar stated that because nothing has been approved, Trident has not
secured a business for the space. He stated that previous discussions included a bakery or
coffee shop as suggestions. He again stated that a vote would not be taking place this
evening, that this public hearing to obtain public input and provide information to the
public.
Mayor Paar stated that of the Council Members he is the one that lives closest to this
development as he lives one (1) block off of Centerville Road and he believed that it would
not affect the value of his home and that he desired this type of development. He stated
that the difficult part of the proposal is the TIF component.
Council Member Koski said whatever goes there is supposed to help improve property
values around the project and if we do not accomplish that we are defeating the purpose of
the project. He explained that the City is not paying for this project but in a way yes the
City is. The developer, Anoka County, School District and other taxing authorities are
paying property taxes that are going to be utilized to reimburse the developer for costs
associated with the project yet every taxpayer will be paying their fair share of the taxes
that will assist the residents in receiving their services rather than the developer paying his
fair share for those services for 20 years. He stated that he also has a concern about the
property values of homes near the project area.
Mayor Paar stated that our City expenses and the schools expenses are going to increase
just due to homes being constructed in Lino Lakes with those children attend the Centennial
School District and automobiles driving through our town with the wear and tear on our
infrastructure.
Council Member Koski stated that there are three (3) other residential developments
happening within the City and none of those developers requested TIF. He questioned why
these developers can construct homes, not request assistance and should involve public
input. Mayor Paar stated that this is one large building all at one time and the other
developments are a home at a time.
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Council Member Montain felt that it was important for the public to get answers to their
questioned and he desired for that to happen.
Council Member Love stated that he would hold his comments until members of the public
had their opportunity to speak.
Ms. DuFault stated that there is a misconception that this money is free and it is the City’s
tax dollars not a grant but the developer will be getting a portion of it back for building the
complex. She stated that she had attended the Planning & Zoning Commission meeting,
has some neighbor’s that have listed their home and disclosed the rezoning and the
proposed development. She also stated that some of the comments that they have received
are that they love the home but do not desire to live in Minneapolis.
Mayor Paar questioned the amount of taxes being collected on this property currently and
City Administrator Statz stated that because it is City owned it is tax exempt.
Ms. Mary Beth Wasiloski, 1688 Heritage Street, directly across the street from the
proposed project. She stated she loves a good coffee shop but she does not want it across
from her home. She described a development along Rice Street in St. Paul which has the
retail space vacant. Coffee shop and fitness shop are very desirable. Looking out here
window really community space for her growing up as there was a skating rink located
there and it brought the community in. She stated that she attends the community events
at Laurie LaMotte Park and does not understand why these events are not drawing crowds.
A community park would be better on the location and why hideout in an apartment and
the retail space was not going to be profitable. Mayor Paar stated that community outreach
has been a priority with the Council, sign out front, twitter and Facebook and but most of
the time smaller kids are on traveling teams and families are busy. Having a community
gathering and Christmas tree at Trailside Park but unfortunately attendance is low at most
events and attempting to get individuals involved in community. He stated that some retail
space along Rice Street have been very profitable. This is a proposal and nothing set in
stone and attempting to market that area along with other parcels. High-end townhomes
are not feasible and working with what we have been approached on. Mayor Paar is
frustrated that everything was put together this evening and am frustrated that the developer
did not attend.
Administrator Statz stated that the TIF public hearing notice was published in the Quad
Community Press which is the City’s official paper. Ms. Nicks questioned how to receive
the paper and she was instructed to notify them and that they were also online.
Administrator Statz stated that if your home was recently rezoned from M-1 to M-2 you
received a letter in the mail. He stated that if you request a Conditional Use Permit or
Planned Unit Development for a site than individuals within 350’ of the site will be
notified. Council Member Koski questioned whether information regarding this
development could or has been put in the newsletter and included with the utility billing.
Mayor Paar stated that no decision would be made this evening as the Council desires to
be open and transparent. However, he stated that the information has been available to
residents and even in his quarterly Mayor’s Minutes.
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Administrator Statz stated that TIF is new but as for an apartment or multi-story building
on that block has been around for 12-13 years (2005-Damon Farber), there has been
numerous joint meetings with Committees and is contained in the vision of Comprehensive
Plan and City’s vision.
Ms. Wasiloski stated they plan on retiring and after 20 years does her house still remain.
Administrator Statz stated that the City cannot condemn your home to construct an
apartment building. She stated that the City could make it very difficult for them to do
anything with their home. Mayor Paar stated that the City just rezoned the Downtown area
in regards to being less restrictive for the M-2 zoning regarding retail on the first/main
level. Administrator Statz stated that if your property was recently rezoned from M-1 to
M-2 you are a legal-nonconforming and previously you could not expand the structure. He
explained that the City amended the ordinance regarding the moratorium and having the
ability to increase the size of the home or add a porch. Ms. Wasiloski questioned whether
amendments could be more restrictive in the future and Mayor Paar stated yes but for not
it has been made less restrictive.
She asked if that can be changed and more restrictive in future. Mayor Paar stated yes, but
it was just made better by this Council. Mayor Paar stated only a 30 unit and 10 retail units
and developer sold really quick and wanted to buy your property for $300,000 similar to
the Beard Group years ago when a large amount of downtown residents chose not to sell.
Then the market crashed and they said is that offer still good and the Beard Group stated
no.
Mayor Paar stated that we are still gaining information from the developer and there are
still questions.
Mayor Paar questioned the residents as to something that they would like to see on the site.
Ms. Nicks stated if something had to be developed there, single-story townhomes or a nice
park but things not being crammed into that small space. She stated it is such a valuable
location and so centralized and have thoughts later. Mayor Paar stated that an email can
be accepted to Administrator Statz and he can forward it to Council. He explained that if
it was forwarded to him and he forwarded it to other Council Members it would be a
violation of the Open Meeting Law.
Ms. DuFault stated that at the Planning & Zoning Commission individuals that attending
agreed green space, community space, splash pad, community garden but if it must be
developed would be a 1-story patio home where her Grandmother could live.
Administrator Statz stated read into the record a letter submitted by Ms. Vicki Byrne and
Mr. Jeff Schmitz owner’s of Kelly’ Korner and the Southern Rail: We, the owners of
Kelly’s Bar and The Southern Rail, want to express our general support of an apartment
project on the city’s vacant lot. While we share neighborhood concerns about keeping the
small-town feel of Centerville, we also recognize that, as business owners, having more
residents within walking distance of our establishments makes good sense. We are hopeful
that the city can work with a developer to ensure a high-quality project that has a positive
impact on our downtown and our business.
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Motion by Council Member Love, seconded by Council Member Montain to close the
public hearing at 8:21 p.m. All in favor. Motion carried.
Council Member Koski stated whether support TIF or now and not call for votes and
Council Member Lakso’s absence, Developer not present and additional discussion
regarding funding. Mayor Paar stated to speak to residents with their concerns. Council
Member Koski thanked individuals for speaking, passion and may be the City needs a
better way of informing residents about meetings and humbled by people that voted for me
and I care about where I live and no personal interest. It is difficult to sit in this chair and
many layers and get and contingency or possibilities of things happening and get more
discussion out there. Change is tough and in the big picture is this project funded by TIF
the best for the community. He also stated that he has concerns whether this will benefit
the neighboring property values and it needs to be validated. He questioned whether there
were other project for this site that would be profitable without TIF. He stated that the City
needs to guide and not force project and this will not gain a population of 5,000 and take
into consideration all things associated with this project. Again, he stated that he
appreciated those that chose to speak and stated that maybe additional discussions needed
to be had.
Council Member Love echoed Council Member Koski’s appreciation for the public’s
attendance, speaking this evening and that it is always interesting to hear other
perspectives. He stated that Council must make decisions as a whole for the City. Council
Member Love stated that his home up until several years ago, did not have a city path along
side of it, but it was what was best for the city. He also stated that now he has a proposed
mini-storage facility being constructed behind him. He again stated that it is important for
Council to consider the best for the City. He stated that Council is interested in developing
the district but does not mean that we are locked in with Trident Development. He
questioned the Administrator stated that he believed the item would be tabled this evening.
Mayor Paar stated that he would motion to table Old Business, Item #1 a and b due to
Council Member Lakso’s absence and the need for more discussion.
Council Member Love stated that he never thought that he would be in support of TIF but
for the last 9 years the property has been sitting empty and not generating taxes. He stated
we have plenty of parks, and the Parks & Recreation Committee has been very creative
and annually requests funding. He also stated that there are other things that could be
constructed on the property but the apartment complex is in front of us. He stated that
something less than 20 years feels better to him.
Council Member Montain stated that he has similar thoughts as Council Member Love, felt
that additional review was needed and that his no comment is due to the need for additional
review.
Motion by Mayor Paar, seconded Council Member Love to Table Old Business, Item
#1 a. and b. All in favor. Motion carried.
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Council Meeting Minutes
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Mayor Paar again thanked the audience for their questions, input and suggestions.
APPROVAL OF THE MINUTES
1. September 11, 2019 City Council Meeting Minutes
Mayor Paar provided an opportunity for others to make modifications to the presented minutes.
Motion by Council Member Montain, seconded by Council Member Koski to Approve the
September 11, 2019 City Council Meeting Minutes as Presented. All in favor. Motion
carried.
2. September 25, 2019 Special City Council Meeting Minutes
Mayor Paar provided an opportunity for others to make modifications to the presented minutes.
Motion by Council Member Love, seconded by Council Member Montain to Approve the
September 25, 2019 Special City Council Meeting Minutes as Presented. All in favor.
Motion carried.
VII. CONSENT AGENDA
1. City of Centerville Claims through October 9, 2019 (Check #32996-33045),
E-Check #1410E-1414E
2. Centennial Lakes Police Claims through October 4, 2019 (Check #12840-
12850, 12831-12839), Optum, US Bank & Visa
3. Centennial Fire District Claims through September 20, 2019 (Checks #8636-
8641) Payroll Check #8631-8635 & U.S. Bank Check #2019013
4. Centerville Elementary PTA Request for Bingo Permit (LG240B), November
22, 2019
5. Special Event Permit Application, Centennial Community Education &
Alumni Assoc. – Halloween Hustle 5K, October 26, 2019, 9:00 a.m. – 12:00
p.m. (Main Street Trail to Rice Creek Chain of Lakes Regional Park & Back)
6. Encroachment Agreement, 7034 Brian Court – Fence
7. Kelly’s Korner Request for Renewal of 2 AM License/Permit
Mayor Paar provided an opportunity for Council to add or remove any item(s) to the consent
agenda.
Motion by Council Member Love, seconded by Council Member Koski to Approve the
Consent Agenda as Presented. All in favor. Motion carried.
II. OLD BUSINESS
1. Block 7 Housing TIF District
a. Res. #19-0XX – Establishing Centerville TIF District 1-8
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October 9, 2019
b. Res. #19-0XX – Authorizing Interfund Loan – TIF District 1-8
This items was previously tabled.
IX. NEW BUSINESS
1. T-Mobile Antenna Lease
Administrator Statz stated that from time to time, correspondence is received from T-Mobile
requesting renewal of their contract prior to the contract’s expiration. In their most recent
correspondence they have stated that they are merging with Sprint and will be determining the
necessity of the existing equipment on the City’s water tower. They have provide the City with
an opportunity for renewal for an amount less than the current lease rate annually. Administrator
Statz stated that the previous Administrator negotiated the agreement and it has been many years,
if ever, that a consultant was hired to represent the City in these negotiations.
Attorney Glaser stated that he assists the City of Lexington from time to time and they just renewed
their lease with T-Mobile. He also stated that they hired a consultant (Steel in the Air), received a
signing bonus, reaffirmed the need for the existing equipment and signed a 10 year contact for
more than they currently are receiving.
Administrator Statz stated that the existing lease with T-Mobile is through December 31, 2021
unless either of us want to cancel. He stated that he would like direction on whether to engage a
consultant, negotiate when the time is closer to December 31, 2021 or negotiate now without hiring
a consultant. Attorney Glaser stated that hiring the consultant was well worth it to the City of
Lexington as it provided leverage during negotiations, informed them of the value of their site and
netted them a signing bonus along with a new 10 year lease. He stated that they felt that the
consultant’s fee of $2,500 was well worth it.
Mayor Paar stated that he felt that Steel in the Air’s consulting fee was financial feasible at the
current lease base rent is in excess of $27,000 annually. Administrator Statz stated that he is not
knowledgeable in the area of this technology to determine whether the existing equipment is
needed or not and its value. Attorney Glaser stated that Steel in the Air is a reputable firm, has a
large up to date database of leases and information that is unavailable to Staff. Council Member
Koski questioned the rapidly changing technology (5G) and questioned its effects on these types
of leases. Attorney Glaser stated that the existing equipment is not going anywhere if it is needed
as the City of Lexington entered into a 10 year renewal. He stated that the antennas are needed as
they generate the main signal and the 5G fills in spots where the signal is weak. Council Member
Koski questioned if T-Mobile was the only equipment on the watertower. Mark stated that their
equipment was only on the watertower. Attorney Glaser stated that they upgrade the equipment
from time to time also. Administrator Statz stated that the city cannot charge a lease fee for 5G
technology on streetlights, etc. Attorney Glaser offered the utilization of a firm similar to Steel in
the Air to the previous City Administrator and he chose not to utilize them.
Attorney Glaser stated that he recommended Steel in the Air because he felt that their reports
appeared to be very comprehensive and the League of Minnesota Cities concurred.
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City of Centerville
Council Meeting Minutes
October 9, 2019
Motion by Council Member Love, seconded by Council Member Koski to Direct Staff to
Enter into an Agreement with Steel in the Air to Obtain a Lease Assessment of the City’s
Watertower Site with Costs Not to Exceed $2,500 and Direct Staff to Negotiate Terms of
Potential Lease Agreement Extension Based on Recommendations of the Consultant for
Future Consideration of Council.
Mark and Kurt settlement negotiations give selection of options and come back to Council. Staff
can not commit City.
Council Member Love questioned the timing of Council’s consideration regarding the above stated
item. Attorney Glaser stated that the agreement would be entered into by himself on behalf of the
City of Centerville to provide for attorney client privileges. Attorney Glaser stated that the report
would be forwarded to him and not shared with T-Mobile. Attorney Glaser stated that they would
provide a selection of ranges of fees and terms and that would be brought to Council for
consideration. Both Administrator Statz and Attorney Glaser stated that they cannot commit the
City.
All in favor. Motion carried.
X. COUNCIL/ADMINISTRATOR ANNOUNCEMENTS
1. Administrator’s Report
Administrator Statz stated that the City received confirmation of being awarded a storm
water grant from the Metropolitan Council. He reported that the next work session of
Council would be discussing sewer fund, completing the water fund. He stated that weather
permitting, curb and gutter would be completed in both the Bayview Villas and Old Mill
Estates the following week.
2. Council Reports
a. Lakso – Absent
i. Parks and Recreation Committee
ii. Economic Development Authority
iii. Fire Steering Committee
b. Love –stated that the Centerville Lions held their annual Chili Cook Off over
st
the weekend and congratulated the Boy Scouts for their 1 Place taco chili.
Council Member Love also reported that he would be speaking at an upcoming
Minnesota Association of Small Cities meeting.
i. Police Governing Board –
ii. Economic Development Authority –
c. Koski – stated that he had attended a Beyond the Yellow Ribbon conference in
Brainerd, learned a great deal, has suggestions/ideas for assisting families of
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Council Meeting Minutes
October 9, 2019
deployed family members for EDA, and park programs. He stated that Ms.
Dorothy Rademacher is very active in this organization and more information
would be forthcoming.
Council Member Koski stated that there are three (3) coordinators of the
Beyond the Yellow Ribbon Program for the entire State of Minnesota.
i. Planning & Zoning Commission – Council Member Koski stated that
that the Commission discussed driveway widths and outdoor storage of
different types of vehicles. He stated that the discussion was very robust
and it would be at a later date when an amendment to the City Code
happens.
He stated that Mr. Greg Witzel, 7289 Brian Drive has been attending
the meetings diligently.
ii. Fire Steering Committee –
d. Montain – Nothing to report
i. North Metro Telecommunications Commission –
ii. Anoka Fire Protection Board –
e. Paar – thanked Council Member Koski for attending as the City became a
member last you and it is wonderful for a member to represented Centerville.
He stated that the Lions Heart group and the Centerville Lions may be a group
to assist in providing these families help also.
i. Police Governing Board – November 18, 2019
ii. Other Mayoral Reports –
Mayor Paar stated that the Lions Annual Chili Cook Off was rainy, muddy and
st
cold. He congratulated the Boy Scouts for their 1 Place for their Taco Chili.
Mayor Paar stated that the event is for a good cause and takes a lot of work to
organize and staff such an event.
Mayor Paar stated that he attended a staff luncheon where Building
Official/Public Works Director Paul Palzer received a Years of Service award
and recognition (25 years). He stated that Mr. Palzer was the City’s first full-
time Public Works employee. Mr. Palzer stated that the City is in a very good
position currently and that he was very proud to work for the City.
Mayor Paar reported that he had attend the Paul Steffel & Family Benefit held
at St. Genevieve’s Community Parish recently. He stated that it was “mind-
blowing” to see the support and community involvement. He reported that Mr.
Steffel’s health has improved and the doctors believe it is nothing short of a
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City of Centerville
Council Meeting Minutes
October 9, 2019
miracle. Mayor Paar desired to thank Ms. Lisa Waldo (MidwestOne Bank),
Mr. Mike Giovanizzo, (American Family Insurance) and the Centerville Lions
for organizing such an event. He thanked businesses and individuals that
donated items for the silent auction and desired to pass along continued prays
for him and his family.
XI. ADJOURNMENT
Motion by Council Member Koski, seconded by Council Member Montain to Adjourn the
October 9, 2019 City Council Meeting at 9:04 p.m. All in favor. Motion carried.
Respectfully submitted by City Clerk, Teresa Bender.
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