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HomeMy WebLinkAbout[04a] Minutes, September 19th September 19, 2017 Page 1 of 2 Pursuant to due call and notice thereof, the St. Joseph Economic Development Authority met on Tuesday, September 19, 2017 at 5:00 PM in the St. Joseph Government Center. Members Present: Chair Dale Wick. Board Members Larry Hosch, Gary Osberg, Rick Schultz, EDA Director/Administrator Judy Weyrens Members Absent: Doug Danielson City Representatives Present: Finance Director Lori Bartlett, Community Development Director Therese Haffner Others Present: Jon Petters Chair Dale Wick called the St. Joseph Economic Development Authority meeting to order at 5:00 PM Public Comments: No one present wished to speak. Agenda Approval: Osberg made a motion to approve the agenda, seconded by Hosch and passed unanimously by those present. Consent Agenda: Osberg made a motion to approve the consent agenda as follows; seconded by Wick and passed unanimously by those present. a. Minutes - Approved the minutes of August 8, 2017. b. Financial Report - Accepted the August 2017 Financial Report as presented. Discussion on Housing Programs: Weyrens presented a request for consideration by Al Keller, Elite Development to offer tax increment financing (TIF) for construction of single-family homes. In a recent meeting with Weyrens, Keller discussed that development costs make it difficult to develop entry level homes. Weyrens reported that staff researched what the area cities’ fees were in comparison and that St. Joseph ranges from about $2,000 to $3,000 higher due to the water access charge (WAC). Staff met with TIF consultant Tammy Omdal, Northland Securities on housing incentives. TIF may be used for affordable housing with 95% of the housing being owner occupied for individuals or families of low to moderate income as established by state guidelines. The City may offer tax abatement as an alternative with no risk to the City. Weyrens provided background on tax abatement. The area cities are not offering housing incentives at this time. Schultz questioned TIF for Fortitude Senior Housing. Weyrens shared that was a different product that qualified for TIF. Consensus was that TIF should not be used. Osberg questioned lowering the WAC fee to which Weyrens stated the City relies on the fees for the existing debt. The City cannot lower or waive the WAC. Hosch discussed families moving to Sartell and Sauk Rapids because of their school districts and we are not seeing that in St. Joseph. Osberg questioned next steps. Weyrens suggested meeting with Keller and the TIF consultant to discuss further. Hosch said he agrees that TIF should not be used but if Tax Abatement would be used the findings need to clearly delineate why tax abatement is being provided. Weyrens agreed and confirmed that the process determines if there is a financing gap. Consensus was for staff to meet with Developer Al Keller and the TIF consultant. EDA Director Reports TIF 2-3, Proposed Modifications: Weyrens shared that Developer Jon Petters has requested to modify the TIF Development Agreement for 24 North (formally Bayou Blues). Petters requested raising the interest rate of the approved TIF to 5% since the interest rates have gone up since it was originally approved three years ago. According to his builder construction costs have gone up 10%. Petters said they have an enormous demand for residential lofts and is requesting to amend his plan to allow three accessible residential lofts at street level with the ability to convert to commercial in the future if there is a demand. The plan was approved for 100% commercial on the street level. Petters is currently going through the PUD amendment process that will be reviewed by the Planning Commission and City Council to allow for September 19, 2017 Page 2 of 2 the modification. Weyrens reported that she has discussed this with the City’s TIF consultant who confirmed that a 4 to 5% interest rate was reasonable. The number of years may need to change. Bartlett said if the projections go beyond 2037 would the EDA be agreeable to extending beyond up to 25 years. Hosch suggested modifying downtown housing to encourage owner occupied high density residential. Osberg made a motion recommending to the City Council to raise the interest rate to 5%, allow change of use with three residential units on the ground level, and to allow TIF up to 25 years based on the revised interest rate and the increment previously approve. The motion was seconded by Wick and passed unanimously. Industrial Park Update: Weyrens said there is a potential buyer of the industrial park property known as Parkway Business Center so staff is waiting on the status of that before submitting the grant application to MN DEED for BDPI funding. Weyrens discussed the city’s potential role in a partnership with a private owner, including installing the infrastructure and assisting with marketing. If the City is successful with the grant, a formal proposal would be brought forward to the EDA. Development Updates:  Weyrens contacted the owner of JR’s Mobil to gauge the interest in selling the property to the EDA/City. At this time, the owner is not actively selling but he will contact the city before he sells. Weyrens said that Chief Klein is working with the owner to clean up the garbage, tires, and so forth.  Haffner said that she has been in contact with a hotel who is interested in St. Joseph and their target market is small communities and they have a downtown prototype. The next step would be to meet with the company. Comprehensive Plan: Weyrens referenced the vision statement that was included in the packet. A draft of the Comprehensive Plan will be available for review by the EDA in October. Adjourn: Schultz made a motion to adjourn at 5:46 PM; seconded by Hosch and passed unanimously. Therese Haffner Community Development Director