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CC 2017 09 11 CHANHASSEN CITY COUNCIL REGULAR MEETING SEPTEMBER 11, 2017 Mayor Laufenburger called the meeting to order at 7:00 p.m. The meeting was opened with the Pledge to the Flag. COUNCIL MEMBERS PRESENT: Mayor Laufenburger, Councilwoman Tjornhom, Councilman McDonald, Councilwoman Ryan, and Councilman Campion STAFF PRESENT: Todd Gerhardt, Kate Aanenson, Paul Oehme, Todd Hoffman, Greg Sticha and Roger Knutson PUBLIC PRESENT: Janelle Hubeny 7234 Pontiac Circle Fred & Angie Bialczyk 310 Sinner Circle Arlis Bovy 7339 Frontier Trail Justin Bikers 512 Laredo Lane Charles & Julie Littfin 7609 Laredo Drive Paul Sustman 590 Broken Arrow Dennis L. Krill 7613 Laredo Drive Sharon L. Eischens 7613 Laredo Drive Cindy MacDonald 4210 W. Old Shakopee Road, Bloomington Judy Schmeig Box 397, Chanhassen Cori Wallis 1848 Valley Ridge Trail Kay Roalstad 513 Laredo Lane Robert Welliver 403 Del Rio Drive Nicole Nejezchleba 2851 No. Manor Road Vicki Ernst 840 Cree Drive Tony Wichterman 770 West Village Road Rolland Neve 7635 Nicholas Way Kristyn Vickman 1535 Hemlock Way Lita Cantin 6694 Nez Perce Drive Michael Clause Chanhassen Lynne Smoltle ? Rebecca Pederson 503 Laredo Lane Caroline Camp 7241 Sierra Court Michael Leonard 8129 Stone Creek Drive Randy Cantin 6694 Nez Perce Drive Don & Judy Leivermann 7003 Cheyenne Trail Kurt & Mary Braun 900 Hiawatha Drive Kevin Crystal 940 Saddlebrook Curve Chanhassen City Council – September 11, 2017 Wendy & Pete Pemrick 92541 Kiowa Trail Mary Hughes 2741 Sandpiper Trail Erick Hays 2810 Sandpiper Trail Barbara Coldagelli 7265 Pontiac Circle Ann & Bryan Qualley 7605 Laredo Drive Ann Page 10 Hill Street Barb Nevin 6361 Minnewashta Woods Drive Ben Jeffrey 6361 Minnewashta Woods Drive Ron Kramer 1022 Pontiac Lane Kathy Kladek 6321 Minnewashta Woods Drive Cindy Kelley 6331 Minnewashta Woods Drive Lenora Lemke 6781 Redwing Lane Theresa Hefel 7591 Chippewa Trail Mack Titus 2747 Century Trail Roberta Fernandez 7478 Saratoga Drive Robert Bajorek 7015 Dakota Avenue Betty Schmeig 7610 Kiowa Avenue Beth Ann Leonard 950 Saddlebrook Curve Mayor Laufenburger: Thank you and for the record let the record reflect that all the council members are present with us this evening and the invitation that I gave you earlier on, you’re welcome to continue to sign in to register your presence here if you’d like. I want to welcome all of you to the chamber this evening and also to those of you that are watching either on Mediacom cable channel, public access or those of you that may be watching livestream. We have a rather active City Council meeting chambers tonight. I’m guessing there are probably 100 people here this evening and we will conduct our council meeting as we have in the past. We have a public announcement to make tonight. I would like to begin with that. Actually before I do that, council members you have a printed agenda in front of you and you actually have two printed agendas. You have one for the City Council meeting which is the first meeting we will conduct tonight and then the second meeting will be the EDA. Regarding the City Council agenda, is there any modification to the City Council agenda this evening? There being none we will proceed as follows. I’ll ask a similar question when we adjourn to the EDA meeting. PUBLIC ANNOUNCEMENTS: Mayor Laufenburger: First announcement is regarding our Comprehensive Plan open house. I guess I should probably say if you wouldn’t mind, silence your cell phones okay? Thank you kindly. Every 10 years we submit a Comprehensive Plan to the Metropolitan Council. That’s part of the statutes that we are required to do and we are in the process of preparing the 2040 Comprehensive Plan during the last few months and that will continue for the next several months. The Comprehensive Plan is designed to identify the desired qualities and vision for the entire community of Chanhassen and it’s future. The public is invited to share comments and 2 Chanhassen City Council – September 11, 2017 learn more about the 2040 comp plan during our open houses. The open houses will be held on th Wednesday, this week September 13 from 6:00 to 8:00 p.m. at the Chanhassen Library and also th Thursday, September 14 from 6:00 to 8:00 p.m. at the Chanhassen Recreation Center. I would encourage those of you that are available to come and join us. We discuss many, many different aspects of the community, land use, housing. What are some of the other ones? Kate Aanenson: Park and Rec, transportation, sewer and water. Mayor Laufenburger: Park and Recreation, transportation, natural resource protection, a number of different things. It’s an important document for our city. One that we’ve adopted at least, how many times have we done this Kate? Kate Aanenson: Well we adopt it every 10 years so we’re on like our fifth or sixth iteration. Mayor Laufenburger: Okay, alright. So those of you that are interested I would encourage you to participate in that. Okay? CONSENT AGENDA: Mayor Laufenburger: Next item on our agenda is the consent agenda. Consent agenda is generally items that are to be considered routine and will be considered in a single motion based on staff recommendation, unless anyone on the council or visitors present would like to have a discussion. If discussion is desired we’ll move that item to be considered separately. On the agenda we have items D (1) through (4). Based on earlier action in the work session the council has agreed to delete item number D(2) which is adoption of the Park and Recreation System Plan so items D (1), (3) and (4). Any of those items choose to be, council would you have any of those removed from the consent agenda? If not then may I have a motion to approve the consent agenda. Councilman McDonald: So moved. Mayor Laufenburger: Thank you Mr. McDonald. Is there a second? Councilwoman Tjornhom: Second. Mayor Laufenburger: Thank you Councilmember Tjornhom. Councilman McDonald moved, Councilwoman Tjornhom seconded to approve the following consent agenda items pursuant to the City Manager’s recommendations: 1. Approve City Council Minutes dated August 28, 2017 2. Table Adoption of Parks and Recreation System Plan. 3 Chanhassen City Council – September 11, 2017 3. Approval of Retail On-Sale Intoxicating Liquor Sales for Off-Premise Consumption for Buy Chanhassen’s “Night on the Town” on Thursday, September 21, 2017. 4. Approve Temporary On-Sale Liquor License for St. Hubert Catholic Community’s Taste of St. Hubert Harvest Festival on September 30, 2017. All voted in favor and the motion carried unanimously with a vote of 5 to 0. VISITOR PRESENTATION: Mayor Laufenburger: Is there anybody who would like to address in visitor presentations this evening? Nicole Nejezchleba: Yes Mr. Mayor. Mayor Laufenburger: Please come to the council. Just if you, are you want to talk about an item that is not on the agenda tonight? Nicole Nejezchleba: That is correct Mr. Mayor. Mayor Laufenburger: Okay please, state your name and address. Nicole Nejezchleba: Thank you. My name is Nicole Nejezchleba Mr. Mayor and I live at 2851 North Manor Road in the city of Chanhassen. I’m nervous. I have all these people around me watching me. Wasn’t prepared for this. Mayor Laufenburger: Would you say your last name again? Nicole Nejezchleba: Yes I’ll spell it. It’s N-e-j-e-z-c-h-l-e-b-a. It rolls right off the tongue. Mayor Laufenburger: If you wouldn’t mind I’ll stick with Nicole. Nicole Nejezchleba: Yes everybody does, thank you. Mayor Laufenburger: Alright, what’s your presentation? Nicole Nejezchleba: I’m here with approximately 8 of my neighbors. We are in the Minnewashta Manor Road construction project and we are here today to ask the City to postpone the due date of the assessment and reduce the amount of the assessment associated with that road construction project. I also approximately 3 emails of neighbors that couldn’t be here tonight that I will gladly hand over to the City in addition to the 8 members being present today. I don’t know if City Council and Mr. Mayor knows the road construction project is vastly delayed. It 4 Chanhassen City Council – September 11, 2017 was supposed to be done we were told the beginning of school. Latest at the end of September. Now it’s almost 2 months delayed with the prognosis being perhaps October or November. The nd assessment is initially due to be paid in full October 2. The assessment amount is $8,156.30. The residents can also opt to apply it to their property tax with the 5.75 percent interest over 10 years. The road construction project was split into two phases, part 1 and part 2. Part 1 is not completed. I mean phase 1 is not completed. Phase 2 is not completed. Part of phase 2 is now being postponed until next year. The assessment pertains to the entire project, not just parts of the project. The residents that are being charged the assessment would like to postpone the due date of the payment until the entire project is completed which would be whenever phase 2 which is applicable to Washta Bay Road would be completed. At this point we have no prognosis in terms of when that will happen since we don’t know when it’s going to start next year. The neighbors have been really involved with this construction project from day one. Have remained informed. Have worked with the City and we feel that at the time when we nd asked the question why October 2 was picked for the payment date we were told that because the project would be done end of September that the City has to pay it’s bills so therefore we have to pay our bills. Well the City won’t have to pay it’s bills because the construction people are so terribly delayed so we’re asking to have that payment be delayed either with the completion of the entire project or in the alternative if the City feels we should split up the project, phase 1, phase 2, then only be liable for that portion of the assessment where there’s substantial completion of phase 1 and Washta Bay Road which will not be addressed until next year should then be taken out of the assessment and shouldn’t be due until that is substantially completed. I’m not sure if I should continue. I had a few issues that my neighbors have had generally with the construction. There’s lots of people here so maybe I can talk just really briefly so we can move forward. Mayor Laufenburger: Please do. Nicole Nejezchleba: Again these neighbors have stayed incredibly informed and have had conversations with the City. We were very excited about this project but it’s been an absolute nightmare and it’s been a nightmare for things that could have been avoided. One of the biggest issues has been communication. That we’re not informed when things were happening. Things were being changed. We checked the website. The website isn’t updated. All of a sudden trees are being cut that weren’t part of the plan. We’ve had neighbors who come home and there’s a 10 foot hole in their driveway and they can’t get to their house. We’ve had people stuck on the road having to call a tow truck and the tow truck refusing to drive on the road because it’s not drivable. Again these are all questions we addressed a few months ago regarding accessibility of the neighborhood and we were guaranteed that our roads would be drivable during the road construction project which has not been the case. And I could go into this, I feel like I shouldn’t because there’s so many people waiting. Our biggest issue right now, and we can certainly come back in 2 weeks, is that that assessment should be addressed. Should be delayed. Should be reduced since the project is nowhere to be near completion and the City itself at this point doesn’t know when it’s going to be completed and we heard through conversations with the City 5 Chanhassen City Council – September 11, 2017 that council’s already entertaining delaying this assessment so we would like the whole assessment to be delayed until the entire project is completed, which will be sometime next year. Mayor Laufenburger: Alright. Nicole Nejezchleba: In the alternative reduce the assessment amount, taking out that portion of the project that won’t be completed until next year. Mayor Laufenburger: Okay. Could I ask you to stay there for just a moment? Nicole Nejezchleba: Yes, absolutely. Mayor Laufenburger: Would you mind if I ask who of your neighbors or who’s involved in this issue that are present this evening and ask you to show your hands please. Nicole Nejezchleba: Yep, there you go. Mayor Laufenburger: Or yeah better yet, would you please stand up. Nicole Nejezchleba: Right behind me. Audience: And right back here. Mayor Laufenburger: Would you mind just staying there for a moment please. Nicole Nejezchleba: Yes, absolutely. Mayor Laufenburger: Mr. Oehme are you familiar with this situation? Paul Oehme: Yes I am. Mayor Laufenburger: Okay. Do you want to speak to any of these questions? Paul Oehme: Sure. Thanks for coming tonight. Mayor Laufenburger: You can sit down if you’d like. Paul Oehme: City council members, so we have talked about this issue and with our City Attorney and the contractor. The contractor was substantially delayed back in August because of. Mayor Laufenburger: Heavy rains. 6 Chanhassen City Council – September 11, 2017 Paul Oehme: The weather conditions that were out there. It was just the soils became saturated and didn’t get much work done the whole month of August so, and then there was some conflicts with some of the private utilities that were out there as well too so that really slowed the project down and really delayed the project. We are pouring curb this week out on phase 1 and we’re anticipating to pave phase 1 the following week so phase 1 should be done, will be done this year and then we’re also looking at paving North Manor Drive and a portion, another block of Tanagers I believe this year yet too. We won’t be able to get to Washta Bay Road this year unfortunately with the delays that we’ve received so what staff has talked about was bringing th this item back before the City Council on, I think it’s October 9 for consideration and we would look at what we want to do with the assessments. We do want to defer, the proposal is to defer some of the assessments specifically to the project are that we’re not going to get to this year so. Mayor Laufenburger: Okay, so is I’m assuming what Nicole said is correct. That they are nd normally those assessments would be due and payable on October 2, is that correct? Paul Oehme: Well that’s typically where we have to gather the assessments and then take them to the County because the County has to do their work prior to putting on the tax rolls so there’s some lead time in there before we can actually put on the tax rolls so that’s the reason why it’s in October. We are, you know the City is already incurring costs along the way for the work that is going on. There’s partial payments that are going on so the City always is, is paying bills to the contractor. Mayor Laufenburger: Mr. Gerhardt, did you want to make a comment? Todd Gerhardt: Yeah, Mayor, City Council members. What I think Nicole is asking is for some answers regarding the future of this project and I think the best way that we handle this is when residents come to us with an issue like this, that staff goes back and prepares a report and then brings it back to the very next City Council meeting and give you alternatives to the council, to the neighborhood and in that interim give Paul a call and give him some suggestions of how we can move this project forward or how we might restart the project in 2018 and because obviously we’re not going to get it all done this year but, and find a fair and equitable way to handle it that everybody can live with. Mayor Laufenburger: So Nicole I think what you just heard is appropriately the City Council is not prepared to make a final decision on the outcome of this this evening but we’re prepared to listen to staff. Hear what they have to say. Review reports and likely take action either at the next council meeting or certainly no later than the council meeting after that. Nicole Nejezchleba: And I think that’s wonderful and you know I love reports. They’re fantastic. It’s just when you’re living in it there’s nobody that’s going to be more accurate, no offense. Todd Gerhardt: No. 7 Chanhassen City Council – September 11, 2017 Nicole Nejezchleba: Than the neighbors. Not even the staff. Not even the construction people so you know when we hear it’s been the weather, we’ve all lived here in the summer. This was not a bad summer. We see the beautiful days where nobody’s working so it’s not the weather. It’s the construction company, and maybe it’s a bad construction company. We’ve all had them you know as private people that were terrible and it looks like this is a terrible one but what we don’t want to have happen is this project being delayed until next year and we are paying for it 100 percent this year because the City isn’t doing it and we don’t want to do it. Todd Gerhardt: Sure. Mayor Laufenburger: But Nicole I thank you for speaking on behalf of those of you that were present this evening and your message is heard and we will direct staff to come back with a reasonable solution to this. Nicole Nejezchleba: Thank you. I just wanted to put a bug in everybody’s ear. Thank you. Mayor Laufenburger: Thank you. Is there anybody else who would like to speak to visitor presentations on a subject not on the agenda this evening? Alright with that I will close visitor presentations. PUBLIC HEARING: MODIFICATION TO THE REDEVELOPMENT PLAN FOR THE DOWNTOWN CHANHASSEN REDEVELOPMENT PROJECT AREA AND THE ESTABLISHMENT OF TAX INCREMENT FINANCING DISTRICT NO. 11: ADOPT RESOLUTION APPROVING REDEVELOPMENT PLANS; APPROVE CONTRACT FOR PRIVATE REDEVELOPMENT BETWEEN THE EDA AND CHANHASSEN FRONTIER, LLC; AND APPROVE SPECIAL ASSESSMENT AGREEMENT WITH CHANHASSEN FRONTIER, LLC. Mayor Laufenburger: This is an item that involves a public hearing. I just want to say a couple comments about this. This particular topic involves two meetings. It involves a council meeting and there will be an action that could result from the council meeting and then there will also involve a meeting of the EDA. Now this is an official kind of a statutory process that we have to follow. The members of the EDA are the 5 members that you have on the council but according to statute, am I saying this right Mr. Knutson? Roger Knutson: Yes. Mayor Laufenburger: We are obligated to conduct a meeting two different ways, is that correct? Roger Knutson: That is correct. 8 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: Alright. This item is modification to the redevelopment plan for the downtown Chanhassen redevelopment project area and the establishment of a tax increment financing district number 11. This is the process that I will use. First of all I will remind all of us, including council that the plan for this redevelopment has already been approved in a previous council meeting. A majority approved the plan so the first thing I will ask for this evening is a staff report. I will then follow that with requesting any questions from the council to staff for clarification of any sort. Then I will open a public hearing and the public hearing will be an opportunity for any of you present that you’d like to comment on specifically this item. Following the public hearing then I will bring it back to the council for comments and/or action. Now before I ask for the staff report, ladies and gentlemen I understand that this is a very emotional issue. Your presentations during the public hearing are to the council. Not to members of the audience. I would ask that you respect one another and while you may be very compelled to root and cheer and clap to your heart’s content, that is not conducive to the sharing of the public comment. I see many signs in here. I’m not going to ask you to remove those signs as long as you use those signs respectfully so I’m asking that you respect this chamber and this body and yet at the same time share your convictions when we get to the public hearing. So staff, is there a staff report? Todd Gerhardt: Yes Mayor, City Council members. I’m going to give the staff report and then open up the public hearing but prior to opening the public hearing I have asked the developer to make a few comments prior to that opening of the public hearing after my presentation. Mayor Laufenburger: Okay. Todd Gerhardt: But this evening what we’re here to do is to consider a proposed downtown redevelopment tax increment financing district and what’s being asked of the City Council is to adopt a resolution approving the modifications to the redevelopment plan and approve a contract for private redevelopment between the EDA and what is Chanhassen Frontier, LLC which is the developer that is here this evening. And then the last item would be to approve a public improvement and assessment agreement. The tax increment district number 11 encompasses 3 parcels and when I talk, if you could please look at the monitors and I will reference those parcels and items in those monitors and the 3 parcels that would be included in TIF District Number 11 would be those areas highlighted in red. The tax increment financial district number 11 is those parcels in red and then the downtown Chanhassen redevelopment project area in the city of Chanhassen is the area highlighted in the dashed lines that encompasses basically everything north of Highway 5 to I think it’s about Galpin Boulevard, down Coulter, down Audubon, down Lyman, up 101 and along the north side of 101 and then meanders through Lotus Lake and some people asked why does it go that far north? There was some discussions of reconstructing 101 to the north and some TIF could have been used on that reconstruction. Same thing on, following the frontage road along the north side of Highway 5 and then south side of Highway 5 which is Coulter Boulevard. What is a tax increment financing district? It’s a public financing method that is used to subsidize for redevelopment, infrastructure and other community improvement projects and it’s used in many countries, many states and it’s used 9 Chanhassen City Council – September 11, 2017 throughout the US. The building blocks of a tax increment financing district is the TIF captures the increase in market value than what the development is today. So currently the development has a market value of $2,193,800. So that is what we’re going to call the base value for this project. So if you were to drive over there and look at the Frontier Building right now it has a value of $2,193,800. After the development the development would create $24,338,410 and in, which would be roughly $22 million dollars in new market value. So the reason I wanted you to remember the base value is whatever the base value is paying in taxes today will continue to be paid after the tax increment financial district, if the financing district is approved tonight, will continue to go to the city. Will continue to go to the school district and will continue to go to the county. Whatever that base value for that $2,193,800 dollars. For the City it’s a little over $5,000. After the development it will have a total property tax $442,883 and today it’s got, paying taxes of about $50,000 and so of that $442,883 in new taxes people who still get compensated with that new tax value is the state. The state charges all commercial and industrial properties for schools. That’s how they fund and pay school districts. They get a per pupil dollar amount at every school district based on the city’s tax base of commercial and industrial so $20,542 is going to go to the State coffers to pay school districts. Fiscal disparities is going to get $25,241 and if anybody read the Connection last month I did a big article on fiscal disparities and what fiscal disparities in short are cities that have large commercial and industrial bases put money into a pool that goes to communities that are short of commercial and industrial properties. Example, St. Paul. Coon Rapids have very little commercial and industrial base so th they benefit. We lose money in fiscal disparities. We’re the 16 largest contributor in the metro area into fiscal disparities. Market value taxes. Market value taxes are the referendums that you as residents voted on so those levy dollars will continue to go to school referendums for the new high school. For the middle school. For the pool. Their last referendum they had and so they will stay whole as a part of the development of this specialty grocer and apartment. And then I did talk about the base value which is $30,093 so the City still gets it’s $5,600 and some odd dollars so the net TIF available to this development is $309.45 cents. Mayor Laufenburger: $309,000. Todd Gerhardt: And $45 dollars. Not cents. Mayor Laufenburger: Little more than $309 Mr. Gerhardt. Todd Gerhardt: Yeah, sorry. Yep. $390,045. It’s a big difference isn’t it? Mayor Laufenburger: The numbers on the screen are correct, is that correct? Todd Gerhardt: Yes. Mayor Laufenburger: Okay, alright. I think they’re following you. 10 Chanhassen City Council – September 11, 2017 Todd Gerhardt: Okay. A redevelopment district can last 26 years so you can capture that $309,000 over 26 years. The parcels consisting of 70 percent of the area must be and considered improved and they meet that criteria. More than 50 percent of the building must be deemed substandard and we did a report and the building was determined to have more than 50 percent of it to be a substandard condition. Reasonable distribution of conditions. That was met and we are planning on paying 95 percent of the tax increment used to correct these redevelopment issues so 95 percent would go to the developer to make improvements which would be anything from land building acquisition, site improvements, bringing sewer and water, utilities, grading, underground parking structures, and then we can keep up to 10 percent for administrative costs but in this case we felt 5 percent was more than adequate to cover our administrative costs. How we plan to use the tax increment financing funds. Within the TIF District Number 11, 26 years the district can exist. Mayor Laufenburger: Excuse me. Just a second please. Todd Gerhardt: Okay. No more than 25 percent of the increment, I’m going to go back. I want to go backwards to the big map. Keep going. You see the little dot, that’s where we’re going to collect the increment in the middle. Only 25 percent of the increment can be spent outside of the TIF district so 25 percent of the increment can be spent anywhere within the dashed boundary, okay? Because United Properties will benefit from the future upgrade of Market Boulevard they will be assessed $2.1 million dollars which will be paid for by the increment generated from their development. There is also $1.3 million dollars worth of reimbursable expense for the underground parking ramp, soil corrections and public improvements so the first 5.5 years would be used to pay off the $1.3 million and then after the 5.5 years we will collect the increment to upgrade Market Boulevard which is a total cost of $3.4 million and the. Mayor Laufenburger: Mr. Gerhardt. Todd Gerhardt: The developer has agreed to be assessed $2.1 of that. Mayor Laufenburger: Okay, could I just ask you to pause for a second. Nann, I think that are you able to get Todd Gerhardt on the microphone there? Is the answer yes? Okay. Alright I just want to make sure because I’m not sure everybody was hearing it. And secondly, folks I know you’re tempted to have conversations between one another that you’re sitting near. You may not think it’s disturbing but frankly it is so if you want to have a conversation you’re welcomed to take that conversation out into the hallway but please respect the other members of the people that are in the council chambers. Thank you very much and once again if your phone is on, please turn it off. Mr. Gerhardt. Todd Gerhardt: Okay. Next slide. Okay, what is the source of the $1.3 million? The source of the $1.3 million in tax increment financing comes from the increment generated from the apartments and the Aldi’s. The total proposed increment generated over the 26 years is $7,605,939. And the next table, I’m sorry. I don’t know how to make this any bigger but what I 11 Chanhassen City Council – September 11, 2017 tried to do is to show you, and if you look way to the right on the TV’s there’s a $1.3 so that’s the 5.5 that Krause, sorry. United Properties would generate and to meet the needs to offset the development costs to put an apartment on this site. To pay for the improvements to Market Boulevard of $2.1 is the gap between the $1.3 and the $2.1, if you see that in almost the lower right so in essence the council could decertify this district in 20 years and put back on the tax rolls after Market Boulevard is completely paid off. Mayor Laufenburger: Mr. Gerhardt, this is a depiction of cash flows that are brought back to net present value, is that correct? Todd Gerhardt: That is correct. Mayor Laufenburger: Okay, alright. Todd Gerhardt: Next slide. Okay Market Boulevard improvements. The Venue, or Venue. We got rid of the “The”. Venue special assessments is the $2,100,000. I don’t know if you’ve seen Market Boulevard but it’s getting close to the point where it needs a mill and overlay and typically we assess 40 percent of the cost of a mill and overlay back to benefiting properties along Market Boulevard so that would generate about $400,000 and then the rest of it, that gap is Market Boulevard is a municipal state aid road. We receive state funds for improvements to our state aid roads so that’s $900,000 we would use from our state aid funds and the total project cost is $3.4 million dollars. Next slide. So analysis of the redevelopment of the Frontier Building. Market value in 2017 has a value of $2,193,800. That’s the market value of what they’re paying taxes on today. After the redevelopment it will have a market value of $24,338,410. So the total tax today is $71,150. After the redevelopment it will have a total tax of $442,883 of which, instead of getting $5,851 coming to the City it would be estimated at about $70,000 coming back to the City. So almost you know 14 times what we’re currently getting today. Next slide. So total property taxes $442,883 less the state wide taxes. That’s what’s paying for the state uses to pay for schools. Fiscal disparities, that’s going to communities that are commercially and industrially poor. Less market value taxes. Those are the referendums for the library, for the schools. And then the base value which will continue to be paid to the school district, to the county, to the city and to the other taxing jurisdictions. So the annual gross TIF per year is $309,045. So tax increment financing isn’t a new tool for the City of Chanhassen. 90 percent of th the businesses along West 78 Street and Market Boulevard have received TIF including Target, Byerly’s, Market Square, Country Suites, Chanhassen Dinner Theater, Colonial Square, Medical Arts Phases I and II, Axel’s, Town Square, Presbyterian Homes, the apartment that sits down off of 212 and 101 and then the business park that surrounds Life Time Fitness and everybody in the Chanhassen Lakes Business Park where Instant Web, United Mailing, Victory Envelope so tax increment financing has made Chanhassen what it is today in attracting businesses here and also helping businesses pull themselves up by their boot straps and to be successful into the future. Next slide. The proposed motion before the council this evening is the Chanhassen City Council adopts a resolution approving modifications to the redevelopment plan for downtown Chanhassen redevelopment project area and tax increment financing plan number 11. The 12 Chanhassen City Council – September 11, 2017 contract for private redevelopment by and between the Chanhassen Economic Development Authority and then Chanhassen Frontier LLC and finally public improvements and special assessment agreement with Chanhassen Frontier LLC. At this time Mayor I think the developer would like to say a few words and then after he’s completed staff would ask the City Council to open up the public hearing. Mayor Laufenburger: Okay. Before I ask the developer to speak I would just like to clarify, these 3 actions that staff is proposing, these 3 actions are not the final action on this property. The final action actually comes with the EDA, is that correct Mr. Gerhardt and Mr. Knutson? Todd Gerhardt: That’s correct but the City Council needs to approve these for these actions to go to the EDA. Mayor Laufenburger: Okay, so in order for the EDA to conduct the suggested business tonight the council would have to formally approve these, this motion, is that correct? Todd Gerhardt: That’s correct. Mayor Laufenburger: Okay. Before I ask the developer to speak are there any questions of, from the council that you would like clarification on before we ask the applicant to speak? Anybody? Okay, at this time then I would ask, is the applicant here? Is the developer here? Rick McKelvey: Yes I am. Mayor Laufenburger: Please state your name and address for the record. Rick McKelvey: Good evening Mr. Mayor, fellow council members. My name is Rick McKelvey. United Properties, 651 Nicollet Mall, Minneapolis, Minnesota. Mayor Laufenburger: Welcome Mr. McKelvey. Rick McKelvey: Thank you. I think this is now the fifth time that I’ve been before you. There was a couple work sessions and I think 2 Planning Commission meetings so I won’t go into excruciating or a long detail about the project itself. I think you probably heard enough. I’ll certainly share anything that you want to hear about square footage, unit sizes, heights, colors, etcetera. I won’t spend any time explaining that tonight. I will say just a couple of things in the past 6 weeks since we’ve been waiting for tonight we have been doing some fun things. We’ve been selecting and specifying appliance packages. We’ve identified a golf simulator that we intend to install in the property. We’ve identified the AV packages for the community room and a theater room. We’ve identified the fitness equipment amongst other things like flooring. Wood flooring and lighting and fans. All the things that we truly believe are going to make the Venue a fantastic place to live for people in Chanhassen that want to stay here. They want to live here at whatever stage of life you’re in but I know we’re here to talk about the tax increment 13 Chanhassen City Council – September 11, 2017 financing so I’ll spend just a minute talking about that. I and we, United Properties are very proud that we’re promoting a property that. I thought Todd, Mr. Gerhardt is talking to me. I apologize. Todd Gerhardt: In the hallway they couldn’t hear so if anybody in the hallway can’t hear, if you would kind of follow around the corridor and come back through the hallway, there’s some standing in this corner. Sorry Rick. Rick McKelvey: That’s okay. What I was saying is we’re very proud to be promoting a development that we think will help spur growth in downtown Chanhassen with 200-250 residents living and working and shopping. Well not necessarily working but shopping and spending their time in downtown but more importantly creating a tax increment that’s approximately 8 times the tax base that’s there today and Mr. Gerhardt did a fine job of explaining the tax increment financing process but the one thing that I would like to add is the increment that was repeatedly referred to in staff’s presentation is 100 percent paid for by the property owner United Properties and our development partners. We are the taxpayer. It doesn’t come from the public’s pocket. It’s a bit circular in a way. We receive the annual or bi-annual tax bills. We pay the property taxes and the taxes for those first approximately 5 years is what we are requesting to fill our financial gap to feasibility come back to us. From that point on we continue for the term of the district, whether it be 20 or 26 years to be the sole taxpayer for the improvements that Mr. Gerhardt is referencing and obviously we will continue to pay the $440,000 I think is predicted in year one. Presumably that will increase well beyond 26 years and the life of this development so it’s an economic engine that is here for the City of Chanhassen. It’s as Mr. Gerhardt mentioned it’s not unique to Chanhassen or United Properties. Most growing communities, whether it’s Edina or Victoria or Duluth or Bloomington, cities that we’ve recently developed in, all use some type of municipal subsidy that’s at their availability and tax increment financing in the case of this particular property, a redevelopment district is a great tool for redevelopment and to generate that economic engine that I’m describing. The increment and the taxes that we’re talking about tonight are generated solely by the apartment project and they’re applied only to improvements of the apartment project. They’re not applicable to the grocery store. It’s not a business subsidy. It’s solely for the apartment project so I just wanted to point that out. And lastly I just wanted to reaffirm our belief in this project in the market. That there is a very strong market for this development. I think the housing component in particular we could probably build several more of these developments and there is a market appetite for it. I’m very convinced of that. We think and believe that this will be a fantastic place to live. I believe the community will see that when it’s completed and lastly again we’re very proud to be promoting a tax base that’s going to put city tax dollars 14 times what it is today and be a great place to live. I’ll conclude my comments and be available for any questions. Mayor Laufenburger: Just wait a moment please. Thank you Mr. McKelvey. Council do you have any questions at this time of the applicant? Councilmember Ryan. 14 Chanhassen City Council – September 11, 2017 Councilwoman Ryan: Mr. McKelvey you know I’m not going to let you off without asking some questions. No I just have a question if you could go back to the beginning of this project when you first came to the City, just curious was, did you say that the only way you will proceed with this project is if the City agrees to having a TIF district? Was it something that United Properties brought to the City and said we want to do this project only if we receive increment? Rick McKelvey: Well not, thank you Councilmember Ryan. Not exactly in those words but as I’ve stated at previous meetings we’ve been transparent with the City from the very start when we acquired the property. Not only from a cost of our development perspective but also a potential revenue or rent perspective and Todd has seen, Mr. Gerhardt excuse me, has seen all of our numbers and the economics of the project. We had several iterations of different grocers that we were pursuing, whether it be Whole Foods or Aldi or Trader Joe’s or Fresh Thyme and all the growing, well not so much growing but popular names in today’s market and the project that we can deliver, as you know is the Aldi with the 134 apartment units. We have a cost of that project that we’ve shared with the City and we have a revenue that’s, that we’ve also shared with the City and that produces a return and that return without a small amount of assistance, small in terms of a $30 million dollar development. It’s not small. I don’t mean to diminish the size of our request is what we need to have a market return and I would argue a below market return but Mr. Gerhardt is a very shrewd negotiator so we accepted $1.3 million as our request. Councilwoman Ryan: So just to clarify then the only way this project would go through would be, is if you received the TIF? Rick McKelvey: This exact project that is true. We would, if the City is not cooperative or was not cooperative or this is unsuccessful we will revise our project which may be just the grocery store without the apartment building. Councilwoman Ryan: And in terms of if the grocery store moves forward without the apartment building are there any infrastructure pieces that the apartment building was bringing to the table that then wouldn’t happen to make it feasible for Aldi’s anymore? Rick McKelvey: No, no. The apartment doesn’t really contribute anything to the Aldi’s. Councilwoman Ryan: Like with water connection or anything? Rick McKelvey: No. Aldi can support itself and it’s own improvements, whether it be site or their own building based on their own credit. The cost, where the cost tips over the revenue is on new apartment construction. Aldi can do just fine by itself. Councilwoman Ryan: Okay thank you. Mayor Laufenburger: I would just, thank you for withholding that. Mr. McKelvey, there’s a lot of discussion about the taxes associated with this property. You have a budget that includes 15 Chanhassen City Council – September 11, 2017 construction cost but there’s also fees associated with this property. Have you done an estimate or a calculation of the fees that you would be paying to the City and other entities for this property? Rick McKelvey: Our City fees are over a million dollars on this project Mr. Mayor and permit fees and sewer, access and water charges which is I will say you’re the highest of any city that I’ve worked in. Sorry Todd, Mr. Gerhardt I had to say it. Mayor Laufenburger: Thank you for giving that consideration to your development here in Chanhassen. Council members are there any other questions of the applicant? Mr. McDonald, go ahead. Councilman McDonald: Okay we’ve heard a lot about this if the TIF doesn’t go through the project doesn’t go through but let’s look at it from another standpoint. Realistically if you did not get the TIF funds couldn’t the project still go through but it might mean you would raise the rents on the apartment? Now whether that’s a good business decision or not let’s take that out of it and is that a possibility that the project could go forward but what that would mean is that instead of rents at $1,800 they might go up to $2,100 or $2,200, Rick McKelvey: Thank you Councilmember McDonald. That is not a possibility to raise rents. Really I would pose the reverse explanation to your question is the tax increment financing really allows the rent to be market rate. Whether it’s a new medical building that we receive tax increment financing for. The market rate rent, whether it’s commercial or residential is the max that a market can bear or pay so that the tax increment financing brings the project down to an amount they can pay. If we did not have that (a), we would not proceed again with this particular development but we would certainly not increase the rents beyond a level that the market can pay. Councilman McDonald: Thank you. Mayor Laufenburger: Any other questions. Councilmember Ryan. Councilwoman Ryan: I do. Mayor Laufenburger: Just before. Councilwoman Ryan: Oh sorry, go ahead. Mayor Laufenburger: Councilwoman Tjornhom, any questions? Mr. Campion, any questions? Councilman Campion: Not at this time. Mayor Laufenburger: Okay, Councilmember Ryan go ahead. 16 Chanhassen City Council – September 11, 2017 Councilwoman Ryan: So then a follow up to that if let’s say so the, you know you’re asking for the, and this might be for you Mr. Gerhardt but so if you’re asking for the $1.3 in TIF to set the apartments at $1,800 what happens if then you don’t get the rent that you’re asking? Then what happens to the property value and the assessment, everything that goes into property taxes for this area? Todd Gerhardt: What we are entering into is a minimum market value on this facility of just over $22 million dollars so that minimum market value is the minimum value that this property will have for 26 years. So that basically insures that we will receive that increment. Councilwoman Ryan: Who insures that? Todd Gerhardt: By the developer agreeing to that minimum market value agreement. Councilwoman Ryan: But what if you don’t get that? Todd Gerhardt: He, it gets recorded against the property and he cannot contest it. So somehow they’re going to have to come up for that value. Councilwoman Ryan: United Properties. Todd Gerhardt: And pay taxes on that based on whatever his occupancies are and revenue flows are. Rick McKelvey: Correct. Our taxes cannot go below the projections that were on the screen tonight in any event our costs won’t go below what our costs are. If our rent is below what I’m projecting them to be I have a lot of explaining to do in my office but as I concluded at the end of my statement I think we could build multiple of these properties and they would be occupied at the rent we’re projecting. Mayor Laufenburger: Okay, Mr. Campion. Just a second. Councilmember Ryan, anything further? Councilwoman Ryan: No I’m okay, thank you. Mayor Laufenburger: Okay, Mr. Campion. Councilman Campion: I do have one follow up on that. So then is that period of time where they must repay the $1.3, that’s just that first 5 years? 17 Chanhassen City Council – September 11, 2017 Todd Gerhardt: No, it’s the length of the, we repay them the first 5 ½ years to the tune of $1.3 million and plus 5 percent interest but that’s the 5 ½ years. But the minimum market value stays on the property until this council or future councils decide to decertify the district. Councilman Campion: So United Properties cannot get rid of the property for a certain period of time? Todd Gerhardt: They could sell the property but whoever would purchase the property would have to live. Councilman Campion: Would be assuming that obligation. Todd Gerhardt: With that minimum market value. They may pay $18 million for it but they’re going to pay taxes based on $21 million, or $22 million. Mayor Laufenburger: Does that answer your question Mr. Campion? Councilman Campion: It does. Mayor Laufenburger: Okay, good. Alright Mr. McKelvey I would thank you for your comments. I would simply ask that you stay in the chambers and council may ask to have further questions answer, is that acceptable? Rick McKelvey: I will, thank you. Todd Gerhardt: Just one more comment. Mayor Laufenburger: Mr. Gerhardt. Todd Gerhardt: Rick calls me Todd. We have had going on 3 year relationship of trying to find the biggest and best use for this site. We were courting Whole Foods. We courted Trader Joe’s. They wouldn’t even return the phone call and we were very excited about Fresh Thyme and this past July they made the decision not to be in the Chanhassen market. And for a variety of reasons but most of it was due to location and Aldi’s said they were not afraid of that location and chose to sign a lease or purchase agreement on that property. So I just wanted everybody in this room to know that we did our best efforts of going out and testing the market to see if we couldn’t get somebody to locate here. Market Boulevard has traffic of about 5,000 cars per day that runs in front of the Chanhassen Dinner Theater, Brindisi’s and Axel’s. Highway 5 has 55,000 cars per day that travel on there. The development that you’ve seen go on in this community is everybody that have seen or wants to be seen with exposure on Highway 5 so that is what we’ve been up against in trying to find users against, for this site so I just wanted the public to understand that. 18 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: Just to clarify, you use the term Market Boulevard. I think you were th referring to Great Plains Boulevard to 78 Street, is that correct? Todd Gerhardt: Correct, yeah sorry. Mayor Laufenburger: Thank you Mr. McKelvey and Mr. Gerhardt. Pardon? A lot of these people were thinking wait a minute, Market Boulevard doesn’t go by Chanhassen Dinner Theater. Alright ladies and gentlemen once again in just a moment I’m going to open a public hearing and I would simply ask that you remember that you’re addressing the council and your comments are asked to be directed to the council regarding the matter at hand which is the motion that’s on the screen at this time and I welcome any and all. The only thing I would ask is that you make it clear your address and whether you’re a Chanhassen resident or a resident from a nearby community so at this time I would like to open the public hearing. Who would like to speak? Judy Schmeig: Can we line up so we can make it go faster if we want to talk? Mayor Laufenburger: I appreciate your boldness ma’am. Would you step to the microphone and speak and tell us your name and your address and state your comments. I think you can pull that microphone down just a little bit. There you go. And speak slowly so we got you, okay. th Judy Schmeig: Judy Schmeig, 200 West 77 Street, Chanhassen. Mayor Laufenburger: Judy Schmeig. Judy Schmeig: Yes. Mayor Laufenburger: Welcome Judy. Judy Schmeig: Thank you. I’ll go quickly. Your comment on finding grocery stores that would come here, we don’t need one. That’s why they don’t come so that’s first. Second, has United Properties purchased TIF 11 already? Todd Gerhardt: They own the 3 parcels that exist right now. Judy Schmeig: So they’re not a Frontier Dinner Theater? Todd Gerhardt: Bloomberg Companies owned those 3 properties. It’s not associated with the Chanhassen Dinner Theater so they purchased the 3 properties highlighted here owned by Bloomberg Properties. Judy Schmeig: But now they belong to United Properties. 19 Chanhassen City Council – September 11, 2017 Todd Gerhardt: Correct. Judy Schmeig: Okay. Has that. Mayor Laufenburger: Judy? Judy Schmeig: Sorry. Mayor Laufenburger: Could I ask you to direct your question right here please? Thank you very much. Judy Schmeig: Has that TIF 11 been in TIF before for the last 40 years? How many years has that been a TIF development area? Mayor Laufenburger: Okay, just a moment. Okay, Judy I appreciate your questions and I want to respect everybody who has questions so what I’m going to establish here is I’ve made note of your question and at some point we will answer your question, okay. Judy Schmeig: Okay. Mayor Laufenburger: It may be after several people talk. Judy Schmeig: That’s fine. Mayor Laufenburger: Is that acceptable Judy? Judy Schmeig: That’s acceptable. Mayor Laufenburger: So your question is how long has the TIF district 11, has it been in a TIF district in the past. Judy Schmeig: And the funds. Okay, how long has it been that we have been TIF free in Chanhassen? Mayor Laufenburger: Okay, that’s another good question. Judy Schmeig: Is the City Council members also the EDA members? You mentioned you were going to count on it tonight and then it goes to EDA. Mayor Laufenburger: That’s correct. Judy Schmeig: Wasn’t that suggested that be separated at one time? 20 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: By statute, okay. I’ll continue recording your questions. Judy Schmeig: Okay. That apartment building that’s been proposed, there’s one built exactly like it on Highway 5 north by Mitchell Road. Sorry but it actually kind of looks like a gray prison with little windows. Let me know if you’ve seen that building down there. Do City taxes fund the TIF? Mayor Laufenburger: Okay, that’s a good question. I think we answered that but we’ll answer that again, okay. Judy Schmeig: That’s all for now. Mayor Laufenburger: Alrighty. Several questions there. Okay is there anybody else who would like to speak? Mr. Neve. State your name and address please. Rolland Neve: My name is Rolland Neve, 7635 Nicholas Way in Chanhassen. Mr. Mayor and members of the City Council. Mayor Laufenburger: Thank you Mr. Neve. Rolland Neve: I am here tonight exercising my First Amendment right to petition the government for redress of grievances and so these are my grievances. I am deeply disappointed that the City Council has approved the Aldi apartment project that requires Chanhassen taxpayer subsidy to go forward. If a project cannot go forward without taxpayer subsidy it should be scaled down so that a taxpayer subsidy is not required or it should be rejected. The developer for this project, United Properties is owned by the Pohlad family who’s huge financial resources could fund this project without taxpayer subsidy. To enrich the Pohlad family at the expense of Chanhassen taxpayers is indefensible in my opinion and conveys to me the belief that maybe the City Council does not have the best interest of the city residents of Chanhassen in mind. Mayor Laufenburger: Please, please. Please respect Mr. Neve as he speaks here. Rolland Neve: My contact with the Chanhassen residents has shown me that they are not knowledgeable about this project. When it is explained to them the vast majority oppose it. This tells me that the City has done a poor job of acquainting the public with this project. There are many other questions that need to be answered before the project should be funded. The impact it would have on our school system. The increased tax burden that could result. The lack of integration of this project into the long term plan that the City has funded, and any other considerations. It brings into question whether or not the City has done it’s due diligence in analyzing this project. In my opinion this project will radically change the character of Chanhassen. If this project is funded I doubt that Chanhassen will retain it’s rating as one of the best place to live in America. For all of these reasons I respectfully request that the City Council reject funding of this project. Find a project that will enrich Chanhassen and will stand by itself 21 Chanhassen City Council – September 11, 2017 without taxpayer subsidy. Now my beliefs are supported by many other Chanhassen citizens. In fact we’ve had a petition drive going and I have over 700 signatures on this petition to the City Council to reject this project and I present them here. Mayor Laufenburger: Mr. Neve were your remarks concluded? Rolland Neve: Yes. Mayor Laufenburger: Okay. The grievances that you exercise, the petition of grievances, do you have those in writing? Rolland Neve: I do. Mayor Laufenburger: Okay. Would you make sure that they’re delivered to Mr. Gerhardt and the City Council please and also the petition as well. Rolland Neve: Alright. Mayor Laufenburger: Alright, thank you Mr. Neve. Anybody else who would like to speak? Please step to the podium and state your name and address for the record. Tony Wichterman: Tony Wichterman, 770 West Village Road. I am a Chanhassen resident. Mayor Laufenburger: Tony Wichterman, is that correct? Tony Wichterman: Yes, Wichterman. Mayor Laufenburger: Alright, thank you Tony. Tony Wichterman: There’s only 5 points that I have to make Mr. Mayor and council. Women and councilmen. The first is my taxes are going to increase. Your taxes are going to increase. The children’s schools which are already over crowded are going to be completely overwhelmed. There’s already 30 kids per class and that’s going to get bigger and where are you going to put the kids? People are going to be parking in my neighborhood, your neighborhood. In front of houses and on city streets including parking on Chanhassen’s main street. Traffic congestion is going to increase and Chanhassen’s already backed up and antiquated traffic system is going to fail. The final point I want to make is this morning I presented to the City of Chanhassen upstairs 5 information disclosure requests to them and I received a receipt of that so I am asking that you postpone this project. Mayor Laufenburger: Tony, would you restate this number 5 again? I want to make sure I hear this clearly. 22 Chanhassen City Council – September 11, 2017 Tony Wichterman: I have, I presented this morning at 8:20 a.m. 5 information disclosure requests to the City. Mayor Laufenburger: Okay so you presented an information request to the City, okay. Tony Wichterman: So waiting on the information from that to come back. Mayor Laufenburger: Okay. Tony Wichterman: So I’m wondering if. Mayor Laufenburger: Put something down in front of the cameras. Is that something you want us to see? Tony Wichterman: That’s the receipt that they received them. Mayor Laufenburger: Oh that we received the request. Tony Wichterman: Yeah that Administrative Assistant gave me a receipt. Mayor Laufenburger: Okay, alright. Tony Wichterman: So what I’m asking is that, postpone the project until we get more information. Thank you. Mayor Laufenburger: Okay, thank you Mr. Wichterman. Tony Wichterman: You’re welcomed. Mayor Laufenburger: And did you say your address was 770 West Village Drive? Tony Wichterman: Road. Mayor Laufenburger: West Village Road. Tony Wichterman: Yep. Mayor Laufenburger: Thank you Mr. Wichterman. Anybody else? Don Leivermann: My name’s Don Leivermann. Mayor Laufenburger: Don? 23 Chanhassen City Council – September 11, 2017 Don Leivermann: Leivermann. Mayor Laufenburger: Don Leivermann. Don Leivermann: 7003 Cheyenne Trail, Chanhassen. Question I have is, is this project at all going to be related to Section 8 housing? Or at any time in the future can it be converted to Section 8 after it’s built? Let’s say 5 years down the road. Mayor Laufenburger: Okay. Don Leivermann: That’s my question. Mayor Laufenburger: Okay, we’ll answer that question for you Mr. Leivermann. Okay, anybody else wish to speak? Michael Leonard: Michael Leonard. I live at 8129 Stone Creek Drive in Chanhassen. Mayor Laufenburger: Thank you Mr. Leonard, good evening. Michael Leonard: Just a couple of points as I was taking some notes here and one of the things I noted as far as taxes go and I think that’s a thing that everybody should realize. You’re going to take $300,000 a pop. Think of a bag of money, okay. You’re going to take that away from the school districts and the county. It’s not going to go there for 26 years. Okay. My youngest son is going to turn 27 or 28. That’s a long time, okay that you can’t do anything according to the council. We’re stuck. And I heard about $20,000 of that project is going to go to the State of Minnesota so they can pay us back. That’s 2 students as far as my reckoning is concerned. Got $300,000 over here. Got $20,000 back to send 2 students of probably, I don’t know how many students are they going to have in that school? Or in that apartment building. I think that doesn’t make any sense to me. I agree the TIF project situation, I mean you’ve got people moving here in droves to live in Chanhassen. A developer can’t come here and build something? This isn’t desirable? Are we the number two, I don’t know number two, number three, I don’t know. We kind of pay to have the study done anyway but the whole thing is, is that shouldn’t people be coming here. Developers coming here, climbing over each other to build here? I’m sick and tired of listening to this excuse that somehow Highway 5 is some kind of problem, okay. And what they don’t tell you is if you remember the Avienda building there’s going to be more apartments out here as part of that project. Everybody know that? Mayor Laufenburger: Mr. Leonard I would just remind you that I ask you to address your comments to the council. Michael Leonard: Okay. Well maybe you guys don’t know but I’ve looked at the project. There’s going to be apartments going on around out there. I don’t think they’re establishing a TIF district out for Avienda. Holasek their property went on the market. They basically did 24 Chanhassen City Council – September 11, 2017 their own demolition. Prepared the site and the market value went up because they did their own demolition. So I’m quite confused why we need to pay to have that stuff done. I mean if this is such a great place to live, I don’t understand why people aren’t climbing over each other. And the other thing that was made is that well Aldi’s doesn’t need this. Aldi’s going to be a renter. Aldi’s can go anywhere it wants to go as long as they’ll find a person to build them the building and lease to them so this United Properties is going to get this tax increment financing and that’s all just going into the box, okay. Whether they build an Aldi’s or a Trader Joe’s or just build all apartment buildings, it doesn’t matter. Aldi’s goes in there and…Aldi’s. Aldi’s, I don’t know if they care or not. They’re not part of the equation as far as tax increment goes. And to say the City Council doesn’t have choices to be made, I remember, I’ve been living here 30 some years. I remember when Fleet Farm owned property here. Now I’m going to drive, get on the freeway. Create more traffic for myself to go down to Fleet Farm in Carver. At least I don’t have to go to Osseo. I remember when a Harley-Davidson dealership was considered inviting the wrong kind of element to this town and Harley-Davidson’s over in Eden Prairie and I don’t see too much riffraff hanging around the Harley-Davidson so to say the City doesn’t have some kind of input on what goes in this city and what doesn’t go in the city is fallacious, okay. My last point is, I think that this kind of development would be beneficial to mass transit. Southwest Metro, great. They’re great, great company. Mayor Laufenburger: Did you mean Southwest Transit? Michael Leonard: Southwest Transit, great, great company. So they’re going to benefit from this. They’re going to have a bunch of people on there going to be riding the bus. There’s a transit station right next door. I would think that any of the council members that have any kind of, I don’t know affiliation or interest in either the, as far as transparency is concerned in the Southwest Metro Transit or in the Met Council for that matter I think they ought to identify themselves and possibly recuse themselves of voting on this issue. Thank you. Mayor Laufenburger: Thank you Mr. Leonard. Thank you ladies and gentlemen. Anybody else? State your name and address please. Cindy McDonald: Cindy McDonald, 4210 West Old Shakopee Road in Bloomington representing Kraus-Anderson Companies as an agent and representative for the company. We have property in downtown Chanhassen. We support this development. It’s a beautiful development. It will create synergy. Activity in the area and help the businesses in downtown Chanhassen and be a great amenity. I’m also a customer of Chanhassen and this is a development that I will frequent. I think it’s good for the area. Mayor Laufenburger: Thank you Ms. Anderson. Cindy McDonald: My pleasure. Mayor Laufenburger: Appreciate your comments. Anybody else wish to speak on this subject? 25 Chanhassen City Council – September 11, 2017 Mack Titus: Mack, M-a-c-k, Titus, T-i-t-u-s. I live at 2747 Century Trail. Mayor Laufenburger: Mr. Titus, welcome. Mack Titus: Thank you. There was a letter to the editor in the Chanhassen Villager recently which stated and I quote, Chanhassen is the one major Carver County city without any current use of TIF. Why? I suspect that prior councils have understood that the burden of a TIF district falls on homeowners. I moved to Chanhassen earlier this year from Huntley, Illinois, population about 26,000 where I was victimized by 2 TIF districts. When Huntley’s first TIF district was implemented in 1993 the homeowners represented 83 percent of the property tax base. In the final year of the TIF, 2016 they go for 23 years in Illinois. Homeowners represented 91 percent of the property tax base because the incremental commercial and industrial property value within the TIF was not available for general purposes. And this TIF wound up with just 60 percent of the property redeveloped and a $22 million dollar deficit. A second TIF was implemented in 2014 and the impact on homeowners property taxes is already evident. I hope this council understands that the tax burden of a TIF district is made up by higher homeowner property taxes and I urge this council to heed the example of prior councils and vote no on the TIF district. One other tidbit, TIF districts originated in the state of California back in I think in the 1970’s and they no longer permit them in California because the residents of California petitioned the legislature to abolish TIF districts. Thank you for allowing me to speak tonight. Mayor Laufenburger: Mr. Titus, thank you very much. Good evening. Roberta Fernandez: Good evening. I’m Roberta Fernandez and I’m at 7478 Saratoga Drive. Mayor Laufenburger: 7478 Saratoga. Roberta Fernandez: (Yes). Half a mile from here. I did not come prepared to speak as eloquently as some of these other people have with lots of detailed information. I moved here 4 years ago to Chanhassen from Florida and all of you have an email in your inbox from me today talking about how I have seen the growth of Florida over 50 some years and the dangers that I saw the issues that development raises when it’s unchecked and I have had chance to talk to a couple of you on other issues that this council has passed and as a resident of Chanhassen now for 4 years I chose to come to this community rather than Eden Prairie, where I originally had relocated to buy my house because, and to also have a business here. I had a business here in this community for a year and because of signage issues and space availability, the price of rent which is more than Eden Prairie if you can believe that, I was forced to relocate my business to Eden Prairie. When you mentioned sir, pulling yourself up by your bootstraps. I think that applies to a small business like me but it does not apply to a development like we’re hearing about and that to me was a little bit insulting quite honestly. I chose Chanhassen because it still st had that small town feel. Now we all want to come into the 21 Century. We all want growth. I know you struggled with where we’re going to get our tax revenue. How do we continue to 26 Chanhassen City Council – September 11, 2017 burden the homeowners with that? I’ve heard that some of your mouths and I understand that that’s a challenge. It concerns me however though when my $300,000 house is taxed at a rate of around $2,100 and $2.4 million dollars was $5,000 in taxes. I see a little bit of inequity there. And while I realize that real estate pays the majority of the taxes, does that mean that we can allow a developer to come into our city and pay this little bit of taxes to subsidize him so he can make roughly $20 million dollars in profit. And while I’m a business owner and I believe we all deserve to make a buck, I don’t think it should be at the expense of the people that love this community and take care of it. My questions to the council also is when I look at the other development that has happened in just the 3 or 4 years since I have been here, every single chain that has come into this community has run off small businesses that used to support this community and is that the vision that we have for Chanhassen? Because quite frankly if it is I’ve chosen the wrong city. I worry about traffic. I come every day down Great Plains Boulevard. When you allowed the Smashburger complex to go into play, you can’t even turn around in that parking lot when it’s full. Twice I have had to back out onto Great Plains Boulevard at my own peril which has even been made worst since the expansion of that turn lane on 5. People fly around that corner. Now with the Chick-fil-A, I came home 2 nights ago and I couldn’t turn onto Great Plains Boulevard from that lane because everybody was trying to get into that left turn lane there. That is a death trap for many reasons. I worry when we add a couple hundred more cars or 400 more cars, whatever it’s going to be, we’re not widening the roads. We’re not handling those kinds of basic infrastructure here in a very tight community already. I try to go out 101 now and avoid Great Plains Boulevard but there I have two private schools to tend with and at certain parts of the day we certainly don’t want more traffic there and we don’t want people cutting through our neighborhoods to avoid that as well. And so it seems to me that this decision has already been made as to the structure of the property and I am in the camp we do not need another grocery store. We have 3 within one mile of each other. While that seems to be a path that has been predetermined I would really ask this council to seriously consider allocating this kind of an arrangement with this company. To really consider that for the vision that you have for this city because for me that’s the big question that I have for all of you. Are we going to be another Tampa? Are we going to be another concrete jungle like I moved from? That’s why I came to Minnesota. It’s why I chose Chanhassen and that’s all I have to say, thank you. Mayor Laufenburger: Thank you Ms. Fernandez. Appreciate your comments. Anybody else wish to speak at this time? Michael Brindisi: Hi there Mayor, council members. Mayor Laufenburger: Hello Mr. Brindisi. State your name and address. Michael Brindisi: Michael Brindisi. I’m President and Artistic Director and part owner of the Chanhassen Dinner Theater and we have been in support of this project all along. I will say that during the course of coming to these meetings I’ve learned some things that I didn’t even think about and my eyes were opened to some issues that surprised me and it was like oh I never 27 Chanhassen City Council – September 11, 2017 thought of that. Like the woman came up one meeting and spoke about the train going behind the apartment buildings and I was like, oh I never thought about that. Actually my wife, she loves the sound of the train. When it goes by, when we get up in the mornings sometimes she’ll say wasn’t that train great at 3:00 in the morning? Isn’t it a beautiful sound? So I didn’t hear it. But ever since being enlighten by that woman I hear it all the time now. So anyway I think I’ve learned some things about this project that I see both sides of it. I can say about Aldi’s, that probably wouldn’t have been my choice either. I mean I would have hoped for Fresh Thyme. I was hoping that that would come through or Whole Foods or something a little hipper but it is what it is. I mean this is what, quite a few of my actors that are very excited about the Aldi’s. They shop there all the time so I think it could work and I think it brings life to downtown. You know when we started this pub, and I’ve been in show business, I’ve been in the entertainment business for 50 years. Since I was 17 years old and now I’m best known for having my name on a bar. You just never know I mean what’s going to be around the corner. Mayor Laufenburger: Fame is weird isn’t it Mr. Brindisi? Michael Brindisi: You just don’t know what’s going to happen. Here’s an empty room that was th sitting facing 78 Street and we said we’ve got to do something with this room. There’s no life in this room and so you know we spent $20,000 fixing up the patio and it’s making money. I mean yeah it’s generating a half a million dollars a year but that’s not what’s exciting about it. What’s exciting about it is all the people there every night and the life in that place. It didn’t exist. It was a dead room. It was empty. My former owner and my boss, his big plan was to move the Dinner Theater to Bloomington. There’s a good idea. The Chanhassen Dinner Theater in the Mall of America. It’s crazy. I go there just about every night and sometimes there’s 1,100 people in there and we have weddings and concerts and I can’t imagine that room being dead… We’re in the business of making life. We support this project. Yeah it will be good for us. There’ll be people next door and it will generate, what you call density. But that’s what I call life and so that’s why we’re in favor of anything that brings life to our downtown. Thank you. Mayor Laufenburger: Thank you Mr. Brindisi. Before everybody steps forward could I just hold for a second. Let’s go back and see if we can address some of the questions. Judy Schmeig asked the question how long has the TIF, has this property been in a TIF ever before. Mr. Gerhardt do you know the answer to that question? Todd Gerhardt: What we’re doing this evening is creating a new TIF District #11. The Frontier Building was in a TIF district prior and then the downtown TIF district I think is what Judy was referring to. Encompasses everything in the downtown and the Chanhassen Business Park and that district was decertified in I think it was 2005 and we reduced property taxes by 10 percent at that time and then we took $800,000 of levy for equipment purchases so we didn’t have to sell equipment certificates to buy new plow trucks, pick-up’s and things like that so tax increment has benefited this community. We have the lowest tax rate in the metro area, municipality standpoint and tax increment did that for this community. 28 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: Okay. Judy also, Ms. Schmeig also asked the question is the EDA membership the same as the City Council. By statute in Chanhassen the 5 members of the City Council are also the 5 members of the EDA. Is that correct Mr. Knutson? Roger Knutson: That is correct. Mayor Laufenburger: Okay. Todd Gerhardt: Mayor if I could add. Mayor Laufenburger: Go ahead. Todd Gerhardt: I think Judy is a long time resident of Chanhassen and she remembers the day when there was a HRA which did not consist of the City Council serving on that board and there was big discussions back and forth if it should be the City Council or should it be a separate board I think is what she’s referring to and the change was made after we decertified the district and make Chanhassen, after that district was decertified. Mayor Laufenburger: Okay. Let’s see. Would you step to the microphone Judy. Judy Schmeig: How long has it been that we have been TIF free? Todd Gerhardt: There have been individual projects. Judy Schmeig: But in total in the downtown area. You’ve been putting TIF in spots recently. Todd Gerhardt: Right now North Bay, which is a housing development down off of Lyman. Mayor Laufenburger: North of Riley Lake. West of Eden Prairie border. Todd Gerhardt: Yes, to make home ownership affordable for individuals down in that area for 25 units. And then the Gateway Center at Great Plains and 212. The apartment building that sits in the southwest corner of 101, old 101 and 212 is an affordable project and they’re receiving TIF and I think that one is planned to be decertified in the next 2 years. Judy Schmeig: What about in the downtown area to Highway 5? Todd Gerhardt: There are no TIF districts in the downtown area. Judy Schmeig: How long has it been they’ve been TIF free? 5 years? Todd Gerhardt: About 5 years. 29 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: Are you including the TIF District 10 which was just recently decertified? Todd Gerhardt: TIF District 10 never did create any increment. Mayor Laufenburger: So it was created but, the district was created but there was no increment. Incremental property tax or incremental revenue from that. Todd Gerhardt: Correct. That existed 5 years and did not see any development and then the Frontier Building was the last district that we decertified. Mayor Laufenburger: Okay. Mr. Leivermann asked the question. Mr. Leivermann, raise your hand. Mr. Leivermann asked the question regarding is this Section 8 housing? Will it ever be Section 8 housing? Is there anything to prevent it from being Section 8 housing? Is that a fair statement Mr. Leivermann? Okay. Mr. McKelvey, do you want to speak to that just for a second? Rick McKelvey: Yes I will. In our development agreement with the City we have agreed for the life of the project it will be recorded against the project, there will be no limitations on rent. Mayor Laufenburger: Okay, when you say the project you mean as long as the development is in your hands or as long as the development exists? Rick McKelvey: As long as it exists. Mayor Laufenburger: Okay. And Mr. Gerhardt are we memorializing that affirmation somewhere? Todd Gerhardt: Yes we’re taking that agreement and recording against the property so if the property owner should transfer ownership to somebody else, that agreement still stands with the new ownership. Mayor Laufenburger: Okay, thank you Mr. McKelvey. Let’s see. Let me restate that. First of all my question to Mr. McKelvey is, is it Section 8 apartments. He’s made it clear these are market rate apartments and I asked Mr. Gerhardt are we doing anything to memorialize. In other words to document that it will never be Section 8 apartments. It will only be market rate and Mr. Gerhardt said that in the development contract between the City and the developer there’s language that stipulates that this project will remain market rate project. Okay. That language is in the development contract. Todd Gerhardt: Section 6.2 of the private redevelopment agreement. 30 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: Okay. I heard something over here. Did you have a question Councilmember Ryan? We’re not closing the public hearing. We’re just taking a minute to clarify some things. Councilwoman Ryan: Yes, because I had brought this up as well on the previous meeting. So I know that in the agreement it says market rate apartment but does that negate the fact that they could accept vouchers or, I mean how does that work? Could you explain that to me please? Todd Gerhardt: Section 8 housing has a voucher system. There are some housing units out there that are designated solely Section 8 but they’ve also created what is a voucher system where they will give you a certain amount of money to go towards finding your own housing. Mayor Laufenburger: Could you define they? You say they will give you. Could you please the they. Todd Gerhardt: It’s usually the community development agencies within the counties and our’s is Carver County CDA. That voucher is not enough to make it affordable for somebody to take that voucher and subtract it against the market rate. You’re going to find a market rate unit that is probably $800 a month for a two bedroom and then take your voucher of $800 and put it towards that. Mayor Laufenburger: Do we have any of those residences in Chanhassen where the property owner or the property operator currently accepts vouches? Is there any of that? Todd Gerhardt: Yes. Yes. Mayor Laufenburger: There are some of those? Todd Gerhardt: We have Section 8 housing in this community. Mayor Laufenburger: Okay. Is that answering your question? Councilwoman Ryan: It does and you know my question previously wasn’t whether Section 8 housing is right or wrong. I think it’s just you know if it is going to be Section 8 or they’re accepting some sort of vouchers and whether one person would spend their voucher on a high end apartment or you know a less expensive apartment, obviously that’s their decision and they’ll use their money at their discretion. My concern is or my question was, do we have any authority to limit or to define exactly what market rate housing is? Todd Gerhardt: No. 31 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: So for example and I’m sorry if I’m picking a residence that some of you may live in. Lake Susan Apartments. Is Lake Susan Apartments identified as market rate apartments Mr. Gerhardt, do you know? Ms. Aanenson. Todd Gerhardt: Yes it is. Mayor Laufenburger: Okay. Do we know if they have any record of people who are making application for using a voucher to cover a portion of their rent? Todd Gerhardt: I do not, my guess it probably isn’t. To get Section 8 housing you have to have a very low income to receive that Section 8 and so my guess the minimum for a one bedroom in Lake Susan Apartments is $1,200. Mayor Laufenburger: But Mr. McKelvey, just to clarify you are building this property with the intent that you will populate it using a market rate, is that correct? Rick McKelvey: That is correct. Mayor Laufenburger: What if you don’t fill the apartments? Is that when you go back to your office and they chastise you? Rick McKelvey: There will be a little bit of that but as I stated and I’ll try to state it more clearly. Our development agreement with the City prohibits limitations on rent and we’re not a low income housing developer. We never have been. I don’t think we will be in my foreseeable future. Mayor Laufenburger: It’s just a choice that your organization, United Properties has made, is that correct? Rick McKelvey: That is correct but my limited understanding of Section 8 or low income housing, to use another term, there’s a median income and the rent is established based on the median income of the low wage earners in a given community and that establishes a limit on the rent that we can charge to those particular individuals and a certain number of units has to be capped at that particular rent and we have agreed not to do that. Mayor Laufenburger: So you have a plan in place for the term of this TIF district and for the term of this project you intend to market this as market rate apartments. Not Section 8. Not affordable housing. Not voucher using, is that correct? Rick McKelvey: Correct. Mayor Laufenburger: Okay. And that will be documented in the development agreement that will be memorialized with the property, not just with the property owner. 32 Chanhassen City Council – September 11, 2017 Rick McKelvey: That is correct. It currently is documented. Mayor Laufenburger: Councilmember Tjornhom, yeah. Councilwoman Tjornhom: Just a point of clarification, we’re all talking about Section 8 housing and renters living in apartments but, someone renting a home with a Section 8 voucher so it’s not just limited to apartments. So if we’re concerned about that it could be the house next door to you that is renting their property out to someone that has a Section 8 voucher or some other public assistance for their housing. Mayor Laufenburger: I just want to make one more comment if I may and then I’m going to return to the public hearing and see if there’s anybody else. This question on market rate apartments was raised I don’t know a few months ago and it was a comment from a citizen that prompted the language to be added to the development contract that stipulated market rates only so the person that made that comment may remember who it was. I just want you to know that that had an impact on how this thing’s going forward so thank you Mr. McKelvey. Let’s return to the public hearing. Is there anybody else who would like to speak at this time? Please step forward to the microphone. Your name and address please. Paul Sustman: Yeah my name’s Paul Sustman at 590 Broken Arrow Road. Mayor Laufenburger: Paul Sustman? Paul Sustman: Sustman, yes. Mayor Laufenburger: Broken Arrow Road. Paul Sustman: Yeah I have two questions. One is the height of the new building. Mayor Laufenburger: Okay, height. Paul Sustman: I believe it’s 6 stories is what I’ve read. Mayor Laufenburger: Okay. Paul Sustman: I believe it will be close to the parking ramp that’s near the theater. Mayor Laufenburger: Close in proximity or close in height? Paul Sustman: Close in proximity. Mayor Laufenburger: Yep, it will be close in proximity. Okay. 33 Chanhassen City Council – September 11, 2017 Paul Sustman: And it will be up the hill from that parking ramp. More towards the main street or whatever that street is called by Brindisi’s. th Mayor Laufenburger: 78 Street. Paul Sustman: Yeah the parking ramp I think has red lights on it for flashing for airport. There’s red lights on top. What are the red lights for I guess is a question I have? Todd Gerhardt: Decoration. Paul Sustman: Decoration. Decoration? Seriously? Huh. That’s contrary to what I’ve heard but okay. Alright, so that’s a question I had. And then the second is with respect to Section 8 housing. What I’ve read is that there’s a trend for municipalities to prohibit landlords from rejecting Section 8 tenants from applying for housing and there’s a big push on that, both at the federal level from HUD as well as if you look at the City of Minneapolis recently passed an ordinance prohibiting landlords from rejecting a tenant based on application that has Section 8 housing. So clearly there’s a trend to accept applicants with Section 8 housing that’s going on and I think from neighbors I’ve talked to and a concern and given the fact that this is a high density housing unit in the central part of Chanhassen it has a potential of changing the characteristics of the city if it also has a high density number of people living there that are subsidized as well as others just because of the density so there was a comment before about Section 8 housing where one of your neighbors may be living in a house might be subsidized Section 8 housing. Although that’s true that’s not in a high density situation. If you look at many of the problem areas they tend to be in more high density areas and many of those have Section 8 housing. That’s statistically factual and that’s a concern I think that people have so I don’t think it’s, although they may be able to deny a tenant from applying today because that’s their intention, I don’t think that’s enforceable. I highly doubt it would be and the trend clearly is that more of that type of housing will be preferred in the future so that’s it. Anyway that’s my concern. I’d like to get a comment on that. Mayor Laufenburger: Alright, thank you Mr. Sustman. 77 feet by the way is the height of the building. 77 feet. Mr. Knutson, I’m going to need your help here with this. This question seems to persist though we’ve attempted to answer it, that a landlord or a city cannot deny a request for, deny the application or the request for somebody to enter an apartment and claim Section 8 capability. Do you know anything about the legal law regarding that? Roger Knutson: Some cities are discussing that issue and perhaps some cities have weighed in on it and said you have to but the City of Chanhassen has not done that and the redevelopment agreement prohibits it. 34 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: Okay, so the redevelopment agreement, which is a, it’s actually part of our agenda for tonight. If that redevelopment agreement is agreed to that means the developer, the property itself cannot accept Section 8. Roger Knutson: It has to be market rate housing. Mayor Laufenburger: It has to be market rate, okay. Thank you for that clarifying question Mr. Sustman. State your name and address please. Pat Fitzsimmons: My name’s Pat Fitzsimmons and I live at 7400 Chanhassen Road. Mayor Laufenburger: Welcome Mr. Fitzsimmons. Pat Fitzsimmons: Thank you. Mr. Mayor, council members. I ask you to vote no on the proposed TIF for the Aldi apartment complex. It seems to be that there’s been enough study on the impact that this would have on our downtown. I have read you commissioned a vision study that cost the taxpayers somewhere in the neighborhood of $45,000. Mayor Laufenburger: $42,000. Pat Fitzsimmons: That’s in the neighborhood. Mayor Laufenburger: Yeah, that’s a good neighborhood. Okay. Pat Fitzsimmons: To help determine the best options for this key location that we have downtown so the question I have is why would you go forward with a major project like this before you get the results of this information back to you? What we suggest is first of all that you don’t approve the TIF. Secondly that you postpone any development until you get the results of your vision study that we’ve all paid for. And then when you get the results of the vision study we suggest that you share it with us so that the people in Chanhassen know what those results are. And last when we have the information in hand, survey the community and see what options they want to do. It feels like this has been rammed through and the people don’t really have a voice. What goes into this prime space will impact our downtown and our community for years to come so it’s really important that you share this information with us and let us make sure that together we make the right decision. Thank you. Mayor Laufenburger: Okay, thank you Mr. Fitzsimmons. Just to clarify, folks thank you. If I may, the City Council has, and this is public information. This is made available through summary minutes of the work session plus there was a document in this packet. For those of you that may have reviewed it there is a summary document in the correspondence of this packet that includes an early picture of the market scan which is one portion of the contract that we signed with the folks at Hoisington-Koegler. And I’m quoting from this, the following provides additional guidance regarding the retail potential for various types of retail in downtown 35 Chanhassen City Council – September 11, 2017 Chanhassen. Over the next 15 years the downtown district has the potential to support at the very least a smaller grocery store such as an Aldi location. And also this vision update or market scan that the council has contracted for includes much more than just an analysis of retail and apartments in the downtown area. This is a, I would call this an update to that portion of the Central Business District which is part of the entire Comprehensive Plan so Mr. Fitzsimmons your comments are well received. We’ll see how the council responds to that. Okay. Anybody else who would like to speak at this time. State your name and address please. Robert Bajorek: My name is Robert Bajorek. That’s B-a-j-o-r-e-k. Address is 7015 Dakota Avenue in Chanhassen. Other speakers tonight have touched on this but I wanted to request more information from the council about this. Why an Aldi and specifically a grocery was chosen for this location. In the vicinity we have a Byerly’s and Lakewinds Coop that is more higher end groceries. We have Cub and to a certain extent Target as discount groceries in the area. Mr. Mayor you just said that you, it sounded like there was a report that the city can support a smaller grocery store but I’d like to hear more, it’s probably directed to you Mr. Gerhardt about why the proposal is that a grocery is the best choice of commercial, of a commercial business for this location and some more details about the rationale behind your decision. Mayor Laufenburger: Is it Mr. Bajorek, is that correct Mr. Bajorek? Your question assumes that the City chose Aldi’s. Robert Bajorek: No I’m not talking about Aldi in particular. I’m talking about why a grocery as opposed to a different form of business and it looks like you are making overturns. You said like we want a grocery. Making overturns to different types of grocery stores. Why not a different type of business? Mayor Laufenburger: Mr. Bajorek I can answer that question. Development in all of Chanhassen is guided by our Comprehensive Plan. There are land use specifications that are stipulated. There are green space protection. Things that are included in it. There are transportation issues that are addressed. We do this Comprehensive Plan every 10 years and I think you might have heard me say earlier in the meeting that we’re in that process right now asking for participation in the open houses and I was reminded by our legal counsel, Mr. Knutson at a recent meeting that the decision on whether or not a grocery store would occupy that place was made when the Comprehensive Plan was approved, which included this language. I’ll just read a portion of it. This is from the current Comprehensive Plan and it identified the comprehensive, or excuse me the Central Business District. Central Business District is earmarked by a combination of convenience, commercial, civic uses, attractive walking paths to promote interaction and multiple trips among shoppers, visitors and residents. New development in this district is encouraged to compliment the mix and contribute to the activity over an extended day to provide attractive, comfortable walking environments between varied uses. Goods and services examples. So these would be approved uses. Residential. Entertainment. Office. Restaurants. Eateries. Music venues. Retail. Grocery. Household goods and services. 36 Chanhassen City Council – September 11, 2017 Fitness activities. Hotels. Health services and clinics. So the City made a decision that these are acceptable uses and when an acceptable use plan comes forward we’ve already told them you come forward with a plan with these uses than that’s acceptable in this area so had eateries or music venues, though that might have been competitive to Mr. Brindisi or household goods or fitness activities or hotel, had they come forward with a plan then the City would be pretty much obligated to say yes, that’s consistent with our vision. Therefore welcome. I hope that answers your question Mr. Bajorek. Robert Bajorek: I mean from what I’ve read in the papers it’s talking more specifically about a grocery store. What you described has a broader range of potential businesses so it sounds like Aldi’s the one that came forward to you and not really any other types of businesses? Mayor Laufenburger: Actually Aldi’s came, Aldi’s was brought forward by the developer. Robert Bajorek: Okay. Mayor Laufenburger: We didn’t approve an Aldi’s. Earlier I made mention of the fact that the council by a majority vote approved the plan. We did not approve the name on the grocery store. We approved it as a retail grocery store in accordance with the Comprehensive Plan. Robert Bajorek: Okay. Mayor Laufenburger: Okay. Also just, go ahead Mr. Gerhardt. Todd Gerhardt: I just want to add. The reason we have a Comprehensive Plan and a zoning ordinance and Roger Knutson will probably agree to this, it’s property rights. So if you’re a property owner you want to know what your rights are of how you can use your property so we give a list of uses that can go on that property. The developer chose a specialty grocer to go on that property because he could not find any of the other uses that the mayor had highlighted or may not be financially in the same position as some of the other specialty grocers so he chose the specialty grocer. It met our property right conditions in the zoning ordinance so we had to approve that specialty use. Mayor Laufenburger: I would also add to that, Mr. Gerhardt did the City previously approve another grocery store in the, what would be defined as the downtown area or Central Business District? Todd Gerhardt: Yes we did Mayor. Where Total Wine sits, the Trader Joes was approved on that site but another use within that development had a restrictive covenants against other specialty grocers so that negated that development from occurring. Thus they went and found another user which was a permitted use within that area. 37 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: So by way of answering your question Mr. Bajorek, yes. The City does have choices and we make those choices periodically through the city governance process, including the Comprehensive Plan. I would encourage all of you to go to the website and review the document so you can see the document that guides many of the decisions that we at the City Council make so thank you Mr. Bajorek. Is there anybody else who would like to address the council at this time? Frank Ernst: My name is Frank Ernst. That’s E-r-n-s-t. I live at 840 Cree Drive, Chanhassen. Mayor Laufenburger: Welcome Mr. Ernst. Frank Ernst: As I look around the room I see many people that I’ve talked to about this in the past and there seems to be kind of a common theme that I hear from people and that theme is, do residents matter? Most of the people that I’ve talked to on this and that I’ve heard speak tonight there’s some common denominators. If they’re residents living here trying to benefit from this community they seem to oppose this. If they have a position to be in financial gain and only those people that seem to be interested in financial gain seem to have an interest in this project moving forward. I think that we need to take a real, real close look at whether or not we’re in it for the bucks or whether or not we’re in it for the community. I know that this council, some of the senior members of this council have already decided by their votes on whether or not they’re in for the money or not so I think we need to be real cautious about that. Thank you. Mayor Laufenburger: Thank you Mr. Ernst. Anybody else want to make a comment? Go ahead. State your name and address please. Tom Devine: My name is Tom Devine. I live at 7640 South Shore Drive. I’ve been a resident of Chanhassen for about 27 years. Property owner. Mayor Laufenburger: Good evening Mr. Devine. Nice to have you. Tom Devine: I addressed you last month and I talked about this project. I’ve also served in the Second and Third Congressional Districts as the Regent for this area for the University of Minnesota. There’s been many studies done on communities and there’s much work and I touched on this last month when I addressed you. The point that I made last month that I just want to reiterate one more time is the fact that many communities right now across the state are moving towards a much more livable, walkable, servable, much in following Mr. Mayor what you had talked about relative to the livability of the cities and we’re very obviously concerned about that. If we look at the development that have occurred in downtown St. Louis Park, up in Excelsior, up in Wayzata, none of them are including you know bigger box retail in the center pieces of those developments and so I share with you I think that’s part of the issues that are being raised here this evening that I raised last month. I’m not here tonight to address that specific portion but rather the issue specifically about the TIF district and the extension of Highway 101 and if you could just go back to the map for a moment. 38 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: Are you talking about the redevelopment, you’re referring to the redevelopment district, is that what you’re referring to? Tom Devine: The new TIF District #11 extends up Highway 101. Mayor Laufenburger: No. The TIF district is 3 parcels. The redevelopment project area is an area that’s been in place for some time and that does extend up 101. Tom Devine: But it’s my understanding that the new document includes that area north, is that correct? Mayor Laufenburger: Well let’s clarify that. Mr. Gerhardt how long has this redevelopment project area been in place? The one that looks like a Vikings jersey with a. Todd Gerhardt: Guy going back to pass left handed. Mayor Laufenburger: Yeah. How long has that project area been in place? Todd Gerhardt: I would say since, it’s been modified a couple of times. I’d say 2005 is when the last modification occurred. Mayor Laufenburger: Okay, so now Mr. Devine. Tom Devine: It’s my understanding that some of those funds, some of the funds that are being put together right now can be used outside of those 3 projects and used elsewhere within that district. Mayor Laufenburger: Up to 25 percent. Tom Devine: Yeah. Is that correct? Mayor Laufenburger: That’s correct. Tom Devine: Okay, and that’s why I’m here tonight to address this. There’s a little bit of history here but that area, that 101 area there was a group of people, and I’m coming to speak on behalf of part of them because that organization is idle but that group of people about 10 or 15 years ago now worked very diligently to have the trail put in and went to the City to have a trail so that bike riders and pedestrians and walkers wouldn’t walk on 101. It was a safety issue at that time. The City did not have the monies totally allocated to be able to do that and as a result of that, that group of about 300 people, residents and people across Chanhassen worked diligently. Went to the legislature. We got a special bill appropriated to fund that work that was done. That work also expanded the roadway slightly in those shoulders. Not greatly but it 39 Chanhassen City Council – September 11, 2017 expanded it slightly in some areas along that 101 trail but it was also done at a point where we recognized and regraded and corrected some of there and added turn lanes and did some of the improvements that needed to be done on 101. At this point it seems, it seems odd that we would have to worry about trying to fund anything up into that district or maybe that district should be removed all together as part of this. If the work has all been completed. The work that’s been done there. The comment was made earlier this evening we might have additional work that we might want to do up there on 101 or in those areas. That some of you are obviously very familiar and there was an effort made at the legislature this past session to again present a plan to the legislature to fund a widening of 101 which involves a lot of things and I don’t want to get into a discussion about 101. The issue that I’m raising this evening is that we want to limit really where those funds might ultimately go and you can do that. Mayor Laufenburger: Those funds, legislative funds? Tom Devine: No. Mayor Laufenburger: Oh the funds from the TIF district. Tom Devine: …TIF district would be limited tonight in your discussions here and I want to make this a point. I want to make you aware of the point. People are concerned that there’s going to be another effort to do more or to widen 101. The State and Eden Prairie originally agreed to run the road, which instead of down 101. That was originally Dell Road that could be the connector to Highway 5. That work hasn’t really been looked at or addressed in any meaningful way but here’s the point that I want to make. If the State has an indication that your actions tonight, both in this meeting and the subsequent meeting you know Part 2 of this evening, that you are acting to provide more money to the State to do this work, why would we want to use the City taxpayer’s money out of this district to enhance or to start a road project until it’s had, been fully vetted and been transparent to the people of Chanhassen to understand what it is that you’re hoping to do in your new road project that is being proposed or that was mentioned slightly here this evening. So what we’re looking at right now, the concern that was raised here since the last meeting last month is what is the transparency of the road project as it relates to the monies that are being used here in the district that you’re creating here this evening. And those funds. The cart’s a little bit before the horse and so what we’re really looking for is to use that. Last element that I just want to share. Todd Gerhardt: Mayor before he makes that comment, can I comment on that? Mayor Laufenburger: Well I’d prefer that you answer his question after he’s done… Tom Devine: Todd let me. Todd Gerhardt: …101. 40 Chanhassen City Council – September 11, 2017 Tom Devine: Pardon? Mayor Laufenburger: Is your last item. Todd Gerhardt: 101. Tom Devine: Is the which? Todd Gerhardt: Is it separate than the 101 project? Tom Devine: Yeah just as a part of it. That the 101 project, it’s a state road. It’s a county road and it’s a connector. It’s… Mayor Laufenburger: Multiple ownership. Multiple ownership. Tom Devine: Multiple ownership and in of that if the road is turned back to the City of Eden Prairie and to the City of Chanhassen, there is an allocation of money that’s available called turn back funds and at the point that the State acts those funds are the first funds that would be used rather than using monies that you might allocate this evening or that you could possibly restrict this evening and so the taxpayers of Chanhassen are not involved in that so those turn back funds should be your first source and to hint to the legislature that the City of Chanhassen, you the City Council and the people of Chanhassen who you represent are amenable to spending funds into the future here for that road work of whatever that is, is probably premature at this point to take action on and so that’s why I’m talking very specifically about one very specific thing that there’s an action on tonight beyond the rest of what is being discussed here this evening. And all of that is predicated of course on and if a plan is presented for the Highway 101 expansion or development and it’s approved by you, the City. The transparency of all the other elements that it goes through and I realize that has not yet taken place but I want to make you aware of that one issue and your ability to restrict those funds and maybe not use that 25 percent of those funds on anything that relates to that until it’s fully transparent going forward. Mayor Laufenburger: Okay. Tom Devine: So with that I share… Mayor Laufenburger: Thank you Mr. Devine. Mr. Gerhardt do you want to address that question regarding? Todd Gerhardt: Yes Mayor. Nowhere in the tax increment financing plans says that any of the funds will be used for the north leg of 101 and if there were going to be any of those funds you would have to modify and add language into that tax increment financing plan that you have the intent to use increment on the reconstruction of 101 north of Highway 5. 41 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: Alright, thank you Mr. Gerhardt. Mr. Devine. Tom Devine: Yeah if I may, and maybe I misunderstood what was said tonight. When you stated that the, that the piece of land that goes north there, you had mentioned specifically that by having this TIF district that funds could be used in work that’s done north there on 101 and that’s the issue that I’m trying to, that was the issue that the neighborhood group was concerned about and that was the issue that you mentioned this evening so I’m just trying to make sure. Todd Gerhardt: No that was a previous TIF district that, the re, what I was explaining is why is it geographically the big long arm along Highway 5 both on the north and the south side and that was when the other TIF districts existed. But there is nothing in this tax increment plan that increment from Tax Increment Financing District #11 will be used for 101 north of Highway 5. Tom Devine: So that would be restricted then? That these funds could not be used, that 25 percent could not be used in. Todd Gerhardt: You would have to come back and modify the district and go through the same public hearing process whenever you modify the plan. Mayor Laufenburger: You meaning the City Council. Todd Gerhardt: The City Council. Tom Devine: So no funds could be used that are related to the actions this evening? Mayor Laufenburger: According to the language of the documents that are being presented tonight. Todd Gerhardt: Right now the funds can only be used on Market Boulevard and for the apartment complex. Tom Devine: But be it may we’d hate to have you come back and say the 101 road has to be widened because of the increased traffic because now we have 6,000 cars a day going down, you know. You know that’s the point that I’m making. Are we bringing more traffic in to build a box retailer there in the center of Chanhassen? Todd Gerhardt: Well we’re using 20 years of the 26 years of increment to do Market Boulevard and to provide assistance to the apartment. That leaves 6 years of increment and you can only use 25 percent of that so it’s, it’s a small amount that you know that could be used for that project. And again it would have to go through the same process that we’re going through tonight to modify the plan to say that you’re going to use those dollars for that roadway. Mayor Laufenburger: Okay. Mr. Devine one more comment if I may. 42 Chanhassen City Council – September 11, 2017 Tom Devine: Yes sir. Mayor Laufenburger: You spoke about something that is near and dear to this council’s heart and that is related to the turn back funds. I would encourage you to use whatever influence you have on the legislature to speak with Transportation Chair Torkelson of the House. Transportation Chair Newman of the Senate, to encourage them to repopulate that turn back funds because our priority, the City Council has made it very clear that our priority for those turn back funds is not 101 north of Highway 5 but rather 101 between Pioneer Trail and CSAH 61 so anything you can do to exercise, not only you but the entire population to influence the legislature to repopulate those turn back funds which frankly are at risk of being, of drying up so. Tom Devine: I have talked to Mr. Torkelson in fact specifically about the south 101 use of those funds this past legislative session but I also want to say that that was why the people of Chanhassen, the citizenry reacted to get a special bill passed at the legislature to fund on behalf of the City of Chanhassen the 101 corrections and the trail. The trail that was put in there for safety reasons. Paul Oehme worked on that. There were a number of people. There are some people sitting in this room. Mayor Laufenburger: Oh that was the earlier corrections? Tom Devine: Yes. Yeah. Mayor Laufenburger: Because I’m not aware of any. Tom Devine: We couldn’t use, that was part of what the City had proposed to do was to use turn back funds in order to get that done. We did not do that and the turn back funds are difficult to get as it’s been amply pointed out but the point was that at the end of the day we used and got a special bill passed at the legislature to fund road work for 101. Todd Gerhardt: We got a DNR grant for a half million dollars to build the trail. Tom Devine: Thank you. Mayor Laufenburger: Thank you Mr. Devine. Is there anybody else who would like to speak at this time? Good evening. State your name and address please. Betty Schmeig: Good evening. I’m Betty Schmeig. I live at 7610 Kiowa Avenue. Much to the chagrin of the post office who thinks I live in a post office box. Mayor Laufenburger: Your comments about the post office. 43 Chanhassen City Council – September 11, 2017 Betty Schmeig: I live on the only street in town that doesn’t get the option of home delivery by the way. Okay, I also appear to be the only person speaking who has, who lives as close to the impact area of this. Mayor Laufenburger: Say your address again? Betty Schmeig: 7610 Kiowa Avenue. Mayor Laufenburger: Okay, alright. Betty Schmeig: One block east of City Hall. Old City Hall and a block north of the Dinner Theater. Mayor Laufenburger: Okay. Betty Schmeig: I’m concerned about the repercussions. I think this is a done deal, whether anybody wants to admit it or not I think it’s a done deal. Has the council addressed the fact that if they have a 6 story apartment building they may need to buy a new fire truck to the tune of how many hundred thousand dollars? And that means there’s going to be maybe 75 kids a day walking up Laredo to go to school which right now it is just abhorrent between the traffic coming up from Chapel on Chan View and the parents dropping off their kids at Chan Elementary and the kids walking to school and whatever, it’s a mess. I try not to leave before 9:00 in the morning because of that. Have you really looked at how this is going to impact so that you can plan for those types of things too? Mayor Laufenburger: Okay, thank you for your comments Ms. Schmeig. Ms. Aanenson, I think this question on the height of the building came up once before. Ms. Aanenson, do you recall that? Kate Aanenson: Yes, we can adequately, the fire department can adequately serve the building with equipment. Mayor Laufenburger: So Chief Johnson has reviewed this and has said we’ll be able to? Kate Aanenson: That’s correct. Mayor Laufenburger: Okay, alright. State your name and address please. Lita Canton: My name is Lita Canton. I live at 6694 Nez Perce Drive. Mayor Laufenburger: Lita, is that right? Lita Canton: Yes. 44 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: 6694 Nez Perce. Welcome. Lita Canton: Thank you. I understand that there’s 3 City Council members that are in favor of this project and 2 that are not. Mayor Laufenburger: Just correction Lita. The plan itself has approved 3 to 2 approval so your statement is correct. Lita Canton: Okay. The ones that are approving this project, you are of the opinion it’s acceptable to irreversibly change a relatively small town main street into a high density population downtown much like the cities within the 494 loop. We the citizens of Chanhassen as stated before by Mr. Neve, we have a petition of over 750 in number that have signed off just in the last 3 weeks on stating our disagreement with this redevelopment of our small, charming main street. We are within our Constitutional rights to speak up and disagree with what we deem wrong no matter the late hour in which this development proposal has progressed. We will be confronted daily with this unprecedented 6 story eye sore and unneeded low end grocery store if built for several years. You have stated at least 5 ½ pending we will be bombarded with an infrastructure problem created by this ill thought of project. Everything we love about our main street and downtown, and I’ve lived here for 17 years, okay. It will be spoiled for the rest of our lives. Sorry I’m getting emotional. Mayor Laufenburger: Take your time. Lita Canton: I also want to mention the high density apartments like this statistically cause safety risk to communities and this project will put an additional strain on our sheriff department. If we continue down this path quick and unthoughtful growth and development we may need to add more to the sheriff department and even sometime down the road change to an actual Chanhassen Police Department. This will also add to the taxpayer burden which I feel safe to say we do not want. Thanks. Mayor Laufenburger: Thank you Ms. Canton. Next up, welcome. Mark Page: Mark Page, Hill Street. I wasn’t going to speak. The arguments have all been made. That’s clear. Just a couple points I want to make. You guys have the ability to have the courage, and you told me to speak to the council right Denny. Mayor Laufenburger: Please. Mark Page: I’m speaking to you 3 okay. Mayor Laufenburger: Please. 45 Chanhassen City Council – September 11, 2017 Mark Page: I hope you have the courage to trust what the people who put you in office are asking. That’s what we’re asking you to do. 750 people in the last 48 hours I’m asking you to say that so with a decision you can say do I know better than the people who voted me in? Maybe, maybe not. That’s your call. We’re going to find out in about 5 minutes. I ask one of you to have the courage to give us the benefit of the doubt. Mayor Laufenburger: Okay thank you Mr. Page. State your name and address please. Ron Kramer: My name is Ron Kramer, 1022 Pontiac Lane. I’ve been to all the meetings and such and such and I just want to make one thing, a point that everybody brings up Section 8. Well it’s not really referred to as Section 8. Voucher, not really referred to as that. It’s, and they say it’s market value. Market value can be subsidized by the Carver County Community Development Agency. It doesn’t matter, it’s not like someone stated that they won’t have the rent affordable for low income people or for Section 8 but it’s based on income versus, there’s a lot of variables so what is commonly called Section 8, or vouchered can be implemented into this apartment building. I mean there’s no, I don’t care what you memorialize or whatever, it can be done and if they’re not, if the units aren’t filled no, he’s not going to get a spanking. They’re going to get people, they’re going to fill them anyway they can. Mayor Laufenburger: So Mr. Kramer may I ask, were you concluding, were your remarks concluding? Ron Kramer: The other thing is I still don’t understand how 132 is it? 132 apartment buildings? Todd Gerhardt: 134. Ron Kramer: 134 only require 134 parking spots. The added parking for Aldi’s. The added parking for the apartment building still hasn’t been properly addressed. That’s all. Mayor Laufenburger: Okay, Mr. Kramer may I ask you a question? Ron Kramer: Yes. Mayor Laufenburger: Okay. You eloquently spoke about Section 8 or low income housing. Are you against Section 8 and low income housing in Chanhassen? Ron Kramer: I’m not against. I’m just commenting on previous comments saying that the developer won’t allow it. Well and he’s stating that it has to be market value. Trying to make us believe that it’s all got to be out of the person’s pocket to pay the market value. That’s not necessarily the situation. I spoke with Carver County Community Development Agency and that’s the information I’ve gotten from them. 46 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: Okay, thank you Mr. Kramer. Appreciate you answering my question. Is there anybody else who would like to speak at this time? Janelle Hubeny: I never thought I’d do this but I’m going to. Mayor Laufenburger: You’ve been very patient. Tell us your name and address please. Janelle Hubeny: Thank you Mr. Mayor. My name is, and council members. My name is Janelle Hubeny, H-u-b-e-n-y. I live at 7234 Pontiac Circle. First of all I want to congratulate all of you because I read upstairs that you guys won the Voice of the People Awards. Excellent in Built Environment, Natural Environment, Recreation and Wellness and Excellent in Safety. If you do this to the downtown how safe are we going to be? What about those nice little concerts in the park? Oooh, do you know what they’re going to be like? And the traffic. I agree with everybody on their traffic. You know I had some friends staying with me this weekend and we walked down Kerber Avenue and they all marveled at what a nice neighborhood this is. I came here from Chicago and I moved to Eden Prairie because I wanted to get a feel but I bought my house here and I love my neighborhood. I love Chanhassen. I don’t want to see it become a high rise. What else? Okay I’ll quit because you guys, it’s late. Mayor Laufenburger: Thank you Ms. Hubeny. Janelle Hubeny: But I just wanted you to know that it’s more than just money because some things money can’t buy. Mayor Laufenburger: Thank you Ms. Hubeny. Anybody else like to speak at this time? Beth Ann Leonard: I wasn’t planning on speaking either this evening. My name is Beth Ann Leonard. I live at 950 Saddlebrook Curve. Mr. Mayor, council members. I have lived in this neighborhood for 22 years. I first moved out here and thought I was in the boonies. I’ve continued to see what has happened to our city. It reminds me of a strip mall. Chick-fil-A, Total Wines, all of the, I can’t think of the words right now but all of those types of venues coming in. Nothing that makes us unique. We’re being dandified to the tenth degree. My question to you is, has it ever been thought or talked about in this long term vision what will continue to make us unique and special and continue to call us out as a number one city? More than once have we been named that. Number one. Number two. Number three in the nation. What will this venue, The Venue and Aldi bring to us to make us unique. We have the opportunity with the Arboretum, Paisley Park and the Chanhassen Dinner Theater to make ourselves a star city. Right now I don’t see anything that draws people in as we continue to decrease anything that makes us unique. Therefore you’re watching those profits drive by on Highway 5 to go to Waconia. To go to Excelsior. To go to Victoria. Because nothing draws people here or will continue to draw people here. Again we have that opportunity. We’ll never have that again if you build that in 47 Chanhassen City Council – September 11, 2017 downtown. How can we develop that space with unique shops? Unique entities to make ourselves a destination city and not a drive thru strip mall city. Those are my comments. Mayor Laufenburger: Thank you Ms. Leonard. Is there anyone else who would like to speak at this time? Rolland Neve: I wonder if it’s possible I could make another remark? Mayor Laufenburger: Mr. Neve I would allow anybody else who wants to speak first and then you may. Rolland Neve: I didn’t see anybody coming up. Mayor Laufenburger: I thought this gentleman. Charles Littfin: Go ahead. Go ahead I can wait. Mayor Laufenburger: Just a moment. Did you want to make a comment? Charles Littfin: (Yes). Mayor Laufenburger: Okay, I would ask that you speak, address the council first. Thank you very much. Your name. Charles Littfin: Good evening. My name is Charles Littfin, L-i-t-t-f-i-n. I live on 7609 Laredo Drive. I’ve been a resident of this town since 1960. I’ve seen a lot of things happen in this town and frankly I don’t like very many of them. I’ve seen this town pretty much destroyed in my eyes and what you’re going to do breaks my heart. I used to work at the hardware. Fred Aschenlager hired me. That was my first job. I worked at the Dinner Theater. I’ve done a lot of things in this town. I still work in this town. My whole I’ve worked and lived in this town. Where I live on Laredo Drive, right across an elementary school, already have parking in front of my house. When you did that road project a couple years it turned it into a race track. And at the end of Laredo Drive the intersection that is going to feed into this complex that you’re going to build we have the fire department, post office, elementary school, an apartment complex, a bank, a strip mall, all going into that one intersection. Has there been a traffic study done? Probably not. The 3 of you who voted for this don’t even live within this area. You’re on the outskirts. This will not affect you. It will affect me. Already when I leave my house at 6:30 in the morning I take back roads to get to where I work. It’s going to be a mess I’m telling ya. I am not happy with it. You should vote against it. Are you for the Pohlad’s or are you for the people? You decide. Mayor Laufenburger: Thank you Mr. Littfin. Good evening. 48 Chanhassen City Council – September 11, 2017 Laurie Susla: Good evening. My name is Laurie Susla. I live at 7008 Dakota Avenue and I had a couple questions and a couple comments. First I was wondering is it correct that the money going to the school district will be capped at the pre-redevelopment amount when this project goes in? Mayor Laufenburger: Okay. Your question is noted. Laurie Susla: Okay, thank you. Mayor Laufenburger: We’ll answer that in just a minute. Laurie Susla: Then a comment is at the Mayor Is In session that you held Mr. Mayor about a month ago there was quite a bit of concern in the community about the effect that this project is going to have on the Chanhassen schools, particularly the elementary school. I don’t have kids in school here. I don’t have a dog and a spite but I know there’s a lot of community concern. At that meeting you stated, and I know you didn’t mean it in an adverse way but that that was not your problem. That’s, really it’s the school board issue if they need for more funding for adding onto the school or to add whatever is needed for additional students. I feel that if the children that there’s probably going to be a lot of kids in these apartment buildings because if you are a childless person you’re probably living in Uptown or Downtown. It’s the people who have kids who want to come out and enjoy our parks and our city will most likely be living here so there’s probably going to be a fair number of kids in this building and if, although I understand that this is not a council problem if it is something that’s affecting the citizens of Chanhassen and their children then I think that it is a council issue. I also had a comment on the supporting documents part of the packet that was put together. There were only 3 supporting documents in there. Two letters supporting the project and one opposing. There have been many meetings and emails and lots of information. I think we’re pretty clear here that there are a fair number of people who do oppose this and something that I hear a lot is about the silent majority. Is there anybody here who hasn’t spoken tonight. Mayor Laufenburger: Address your comments to the council please. Laurie Susla: I’m sorry. I’m wondering if there’s anyone here who hasn’t spoken to council who is supporting the project but doesn’t feel comfortable getting up and speaking. Thank you. Another question. Is there anything in the rental agreement that dictate how many people can live in an apartment or in each bedroom in an apartment. And if there is something, how will this be enforced? Another question, where does city staff believe all the extra cars will be parking. I think it’s fair to assume that there will be about 2 cars per apartment so that’s 134 extra cars and I’m sure that there is some analysis that was done on this and I was just curious to hear about that. I was also curious for Lake Susan Apartments that was mentioned before, how many parking spots per apartment there are there if we have any idea on that. Another question. Is there anything to prevent the City and the developer from amending or modifying the contract that you all may sign in the future? Another question. Mr. Gerhardt stated in a previous City 49 Chanhassen City Council – September 11, 2017 Council meeting that if the project doesn’t go through the City’s going to have to come up with some way to raise the $2.1 million dollars that United Properties is going to be levied to help improve Market Boulevard and I’m just unclear, Market Boulevard doesn’t seem that bad to me. I’m wondering why it needs $3.4 million dollars in improvements. I’m confused on that. Mayor Laufenburger: Okay, anything else Ms. Susla? Laurie Susla: Yes. Finally with the exception of two business owners here tonight it’s fairly clear to me that the citizens of Chanhassen are opposed to the project and I understand that’s not what we’re meeting about tonight but to the TIF. Additionally from comments for all 30 people at the Mayor Is In meeting, all those people were also opposed to the project. Many people spoke out at the Planning Commission against this project. As many as could spoke out at the City Council meeting when the project was approved. Hundreds of people have signed a petition against the TIF. I feel it’d be great if the City Council would do as a vast majority of the citizens who have expressed an opinion have requested and reject the TIF. And just to be clear again this idea of a silent majority I don’t believe it exists. I don’t know anyone who hopes that the City Council will act as benevolent dictators. Everyone I know wants the City Council to do more than simply hold a public hearing but to actually hear the public and vote no as you’re being asked to by the citizens of Chanhassen. Thank you. Mayor Laufenburger: You asked about the school district. I think, I thought Mr. Gerhardt made it clear that the current level of taxes, what he calls the base value, those will continue as if the development didn’t occur. Laurie Susla: I understand that. Mayor Laufenburger: Okay, alright. Laurie Susla: And that was my question. Mayor Laufenburger: You do understand that? Laurie Susla: Right because currently there are no children going to school from that area that is paying the miniscule, relatively miniscule taxes. You’re making a face. Is that incorrect? There are kids who live in that area of the TIF? Todd Gerhardt: Well it doesn’t matter if you have kids going to the school district. It’s based on your market value. Laurie Susla: Oh I understand that. Todd Gerhardt: Okay. So you know because it has such a low market value of $2.1 million so their contribution would continue to go to the school district like other commercial buildings. 50 Chanhassen City Council – September 11, 2017 Laurie Susla: But at the same time there’ll be lots more kids. Mayor Laufenburger: So let me try to get a question to, or an answer to that question. Ms. Aanenson or Mr. Gerhardt, do we have any indication as to how many school aged kids could reasonably be present in 134 family unit apartments? Kate Aanenson: No. What we do have is a study that the District 112 does every year as does District 276. Mayor Laufenburger: Yep. Kate Aanenson: Apartments typically have the least amount of children. If you look at a single family detached home, that’s where the most children are. So will there be some children there? Yes but it wouldn’t, I don’t think it’d be the preponderance. You can talk to, ask the developers. Mayor Laufenburger: This is what the District 112 and 276 study… Kate Aanenson: Yes, yep…does the studies which we do with them and so that’s typically where you have the most, and then it would be down to townhouses so, but the developer can talk to who they’re marketing to specifically. That’s what we know. Mayor Laufenburger: Mr. Gerhardt did you want to make a comment about that? Todd Gerhardt: Mr. Mayor the State is the major contributor to school districts when it comes per pupil and they continue, will capture their revenue off of the higher value. Okay? Laurie Susla: I’m confused because I thought that the additional value, that was the advantage to the City of the TIF was that the additional, or the increased value, the taxes from that would go to the City and not so much the State or the County. Is that incorrect? Todd Gerhardt: We will receive the increment but if you go back to the minuses I had, less statewide taxes of $20,542. That’s in addition to what the base value is going to the State to fund schools. Mayor Laufenburger: But answer this question if you can Mr. Gerhardt. You identified the $309,000 is the incremental value. That’s the new anticipated tax less the predictable, which predictable tax which goes to the other entities. Does that $442,000 increase over the 26 years of the TIF district or does that remain the same? Todd Gerhardt: That can increase depending on the market value of apartment and the overall tax rate created from the County, the school district, the City and the other jurisdictions. 51 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: So the other jurisdictions, specifically the schools which is Ms. Susla’s question, the other jurisdictions, the schools, they could receive an increase as a result of market valuation over and above the base line of the $22 million is that correct? Todd Gerhardt: No. The market value taxes are any referendums that the school district and the city have passed so the $57,962 is the market value levies that the school district has passed for the high school. For the new elementary school in Carver. Expansion to the middle school in Chaska and. Mayor Laufenburger: If the school district presents another referendum and those referendums pass, then this property, even though it’s in a TIF district it would be subjected to that new referendum, is that correct? Todd Gerhardt: Correct. And whatever their tax rate is at that time. Mayor Laufenburger: Okay, let me continue Ms. Susla. Are there any limits that the City, is there any way that the City can control how many people live in a residence? Mr. Knutson, do you know that? Roger Knutson: It’s a building code issue. Mayor Laufenburger: Building code issue, okay. So there is a limit and it’s governed by building code. Okay. Laurie Susla: May we ask what that would be? For a one bedroom apartment or a two bedroom and three bedroom apartment. Roger Knutson: I don’t have the building code with me so I can’t answer your question. Mayor Laufenburger: But it’s govern, so there’s not an unlimited number of people that could live in either homes or apartments. Okay. Laurie Susla: I didn’t think there were but I was just more curious about what the specifics might be around that. Mayor Laufenburger: Could that be found in our building code ordinance? In a city code. Roger Knutson: No, it’s a State Building Code. Mayor Laufenburger: Oh so we’re governed by the State in that regard? Roger Knutson: Yes. 52 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: Okay, alright. Is that public information Mr. Knutson? Roger Knutson: Absolutely. Mayor Laufenburger: Alright, thank you very much. Can the agreement be amended? Can the agreement between the City and the developer Mr. Gerhardt, can that be amended? I think you might have mentioned something about that. Todd Gerhardt: The EDA is the body that would have to amend the agreement. Mayor Laufenburger: Okay so the answer to that is yes. It can be amended and the EDA would be the authority that could amend that in the future. Laurie Susla: And to be clear the EDA is the same. Mayor Laufenburger: That is correct. It’s the members of the City Council are also the members of the EDA according to statute. Okay. Alright. Ms. Susla, I appreciate your comment about the things that were said at the Mayor Is In. I think, you might also recall that I made the statement there isn’t anything happens in this city that I’m not concerned about, is that true? Laurie Susla: I don’t remember that exact thing but I remember that sentiment which is why I said I felt that you weren’t dismissive in the comment. That’s not problem but you were saying that specifically that is not a City Council issue. It’s a school board issue. Mayor Laufenburger: Right, and do you recall that I mentioned in that meeting that I had a planned meeting with the superintendent. The new superintendent. Laurie Susla: Yes. Mayor Laufenburger: Okay. And I had a meeting with him and I said tell me, is there capacity in our elementary schools for more students and he said yes there is. Laurie Susla: At the Chanhassen Elementary? Mayor Laufenburger: Elementary school, yes. So you can snicker if you want but that’s what he told me. Any other questions Ms. Susla? Laurie Susla: Just the question about Market Boulevard and what is requiring for. Mayor Laufenburger: Excuse me just a second. If you’d like to have a conversation I ask that you take it outside please. Thank you Ms. Susla. 53 Chanhassen City Council – September 11, 2017 Laurie Susla: Just it seemed to me that it was, that that was a critical piece of this project was the $2.1 million dollar levy on, that United Properties has said that they would be willing to accept and I’m just wondering what the issues are, obviously major issues with Market Boulevard that would require the $3.4 million dollars worth of renovations. Mayor Laufenburger: Mr. Gerhardt or Mr. Oehme, would you like to speak to that? Todd Gerhardt: Mayor, City Council members. In the records the City Council asked that we thth look at Market Boulevard and West 79 Street and West 79 Street and Great Plains Boulevard and due to the amount of traffic that’s planned for that area. Laurie Susla: So those two intersections, is that kind of what you’re saying? th Todd Gerhardt: Correct. And they also looked at Market Boulevard as it goes up to West 78 Street because you can’t just do the little bit of Market up to the railroad tracks so the plan came back and recommended that it be 4 lanes with right turn lanes and left turn lanes into the current th intersections in Market. On West 79 Street and Great Plains there’s nothing we can do at this time until other changes are made in that area. Laurie Susla: So Market Boulevard currently is at least 4 lanes where it hits 5 and then it goes th down to 3 where it hits 78 Street, is that correct? Todd Gerhardt: Correct. Laurie Susla: Okay. So we would need to enlarge that by one lane? th Todd Gerhardt: One lane all the way through because as you go from West 78 Street down to just before the railroad tracks it narrows down to one. Laurie Susla: Okay, thank you. Mayor Laufenburger: Ms. Susla you asked a question that I think was not answered. Let me address this to Ms. Aanenson. Ms. Aanenson, is there city code regarding parking requirements for apartments? Kate Aanenson: Yes there is. Mayor Laufenburger: And does Lake Susan Apartments comply with that? Kate Aanenson: Yes. Mayor Laufenburger: Okay. Excuse me? 54 Chanhassen City Council – September 11, 2017 Laurie Susla: He asked a follow up which I will. Mayor Laufenburger: Okay. So Lake Susan Apartments does comply? Kate Aanenson: Yes. Mayor Laufenburger: With our underground parking? Kate Aanenson: Correct. Mayor Laufenburger: They also have surface parking dedicated to them, is that right? Kate Aanenson: Correct. Mayor Laufenburger: Okay so they comply. Kate Aanenson: Yes. Mayor Laufenburger: Alright. And does the plan according to the plan presented by United Properties does that comply with our parking code? Kate Aanenson: That’s correct. Mayor Laufenburger: Okay. Kate Aanenson: So there will be underground parking. Some developers may choose to put additional parking underground, that’s a choice but the minimum they meet as, and then the additional parking is at surface behind the building. Mayor Laufenburger: Or in front of the building. Kate Aanenson: Or in front of the building. Mayor Laufenburger: Okay, and those apartments, if somebody’s in those apartments can they th park on 78 Street? Kate Aanenson: No. Mayor Laufenburger: Why not? th Kate Aanenson: There’s no parking on West 78 Street. Mayor Laufenburger: Okay, do we enforce those no parking laws? 55 Chanhassen City Council – September 11, 2017 Kate Aanenson: Correct. Mayor Laufenburger: Okay. You had another question Ms. Susla. Laurie Susla: It’s a follow up from the gentleman here asked me to ask is on the enforcement of how many people are living in an apartment. How that would be enforced? Mayor Laufenburger: Okay. Could you state your question again just, so I’m not confused by other noises. Laurie Susla: Yes. I’ll put it to you in a supposition. If there are 10 people living in an apartment how would that be handled by the City? Mayor Laufenburger: Well Mr. Gerhardt do you want to address that? Todd Gerhardt: Typically most of our complaints come from neighbors and if they see a large amount of traffic coming in and out of an apartment and feels as though they’re exceeding the capacity, people call us and as a part of that our building official will try to make contact with the property owner and get the phone number of the individual and work with the property owner and the renter and say that the maximum is, and if anybody wants to know what the maximum is call me tomorrow morning and I’ll talk to my building official and get that. Mayor Laufenburger: Ms. Susla I would dovetail on what Mr. Gerhardt says. The City relies substantially on citizens for enforcing many things in our community. Not just. Laurie Susla: …things. Mayor Laufenburger: Anything. You know if a citizen feels that their neighbor’s grass is too long they’ll call us. If the citizens believe that somebody’s building a shed and they’re encroaching on their property line, they’ll call us so a major element of what I would call getting along is, comes from a cooperative spirit between citizens who report things to us in City Hall. They report to us suspicious activity that may be related to drug trafficking or something like that. I use that as an example. So and there’s no reason why that should change. We have public safety personnel that cooperate in the enforcement of those laws. We also have community service officers so I would just say that a major element that contributes to this community and the character of this community is that citizens are engaged so, so we rely on citizen engagement to tell us at City Hall when they feel something’s going on in their neighborhood that seems out of line and to quote. Laurie Susla: Mr. Mayor I might turn that right back on you. Mayor Laufenburger: So let me finish. Let me finish. So if you see something, say something. 56 Chanhassen City Council – September 11, 2017 Laurie Susla: That’s what everyone here is doing tonight. Mayor Laufenburger: I understand that clearly. Anyone else who would like to speak tonight? Judy Schmeig: I just have to say Mr. Mayor you’ve done really well because all these people just want to release at least one big applause and stuff. We’ve been pretty good about being respectful. Mayor Laufenburger: You’ve been very good about being respectful. Judy Schmeig: …speaking so I think we did pretty good. Mayor Laufenburger: You did better than pretty good. You did very respectfully and if anybody would like to erupt in a loud applause now you’re welcomed to do that if you’d like. Is there anybody else that would like to speak that has not spoken? Vicki Ernst: Sorry Rollie. Mayor Laufenburger: Well wait, you’re not eliminating him. Vicki Ernst: No, I realize that. My name is Vicki Ernst, 840 Cree Drive. As a past City Council member, Chanhassen City Council member of 8 years we decided at that time that we wanted to keep Chanhassen as a small town feel. That’s what came back on the citizen survey and that’s what we wanted to do at that time and 3 of you were on that council that I served with at that time. This is what the citizens wanted and I hope that you the City Council tonight will listen and act on what the citizens want. Not what you want. It’s what the citizens want. Now we have petitions. We filled this room. They’re outside of the doors. It’s amazing to me how sometimes the citizens are speaking up but government’s not listening. It’s about time we start changing that. And I don’t need you Mr. Mayor to comment on my comments. I just want you to hear me and I want you to act on the citizens. Thank you. Mayor Laufenburger: Anybody else would like to speak? Rolland Neve: I’m Rolland Neve, 7635. Mayor Laufenburger: You haven’t moved? Rolland Neve: No I haven’t. I moved a couple times up here. I just wanted to make a comment on Section 8 housing. My understanding is that Section 8 housing is a federal statute. That it’s not a Minnesota statute. That it’s a federal statute and I understand that perhaps there are some Section 8 housing existing in Chanhassen, is that correct? 57 Chanhassen City Council – September 11, 2017 Todd Gerhardt: Yes. Rolland Neve: Okay, my analysis of Section 8 housing is on a Constitutional analysis. The Constitution of the United States delegates powers given to the central government under Article I, Section 8. In those powers granted there is no power granted for housing. Section 8 housing and therefore it is unconstitutional under the Tenth Amendment. The Tenth Amendment says that any powers not granted to the federal government are reserved to the States and the people so any Section 8 housing that exists in Chanhassen can be nullified. It can be nullified by the sheriff as being unconstitutional under the Tenth Amendment and so I would just like to give you my thoughts on that as far as that, it’s Constitutionality is concerned and it’s important I think that we all, you know as elected officials you all take an oath to defend and protect the Constitution and constitutionally Section 8 housing doesn’t stand. Thank you. Mayor Laufenburger: Okay Mr. Neve. Is there anybody else who would like to speak at this time? Rolland Neve: Mayor, Mr. Mayor, 8035 Erie Avenue in Chanhassen. Mayor Laufenburger: Thank you. You did not give us your address, that’s correct. Roberta Fernandez: I’d just like to readdress the council. It’s very interesting to me to sit back and watch these proceedings and to note the lack of eye contact with some of these individuals who I know have already made up your mind and I think that’s really unfortunate. Our country’s in a very interesting position these last couple years and I think we’ll all agree. People are very unhappy that they don’t feel they have a voice and to me it’s really interesting to watch, I don’t know. Well I know one of you and another one of you kind of but I don’t have any interaction with you but I watch you and I know, I can tell where you voted and what you’re going to vote tonight and I think it’s really unfortunate that in our country that people are not heard. This is why we have the President that we have. This is why our country is in the state that we’re in and I’d like to think that sometimes in a small community that can be different. It’s why we choose to live in a place where we can feel that we are heard. That we are heard. And with all of your openness tonight, I don’t think it matters and I think that’s really unfortunate. Really unfortunate. And I don’t think there has been disclosure when you talk about first of all copies of things that weren’t enough to have everybody in the room have it and so that everybody can see what is really happening here. I know that I spoke with a council member about Total Wine. Had an hour conversation with this person. Mentioned many people that I knew that were not in favor of that and it happened anyway because it was already done and my guess is knowing Total Wine and yes I do have personal experience in a business relationship with them, they paid a lot of money to city to get that spot and I get that it’s money that makes the world go round but people have said here tonight that that isn’t always what’s important to them and as a taxpayer, I pay a lot more taxes than that apartment building will pay. When we look at it percentage wise I think our voice should have more weight in this than what I’m seeing with this council and not just in this project but every other project that we had. Chanhassen is a drive through city now 58 Chanhassen City Council – September 11, 2017 and it is very sad. And I really hope that this council considers because I know that next election cycle I will be thinking about where I cast my ballot. Thank you. Mayor Laufenburger: Is there anybody else who would like to address the council this evening? Mr. Neve, you were the one that presented the petition is that correct? Rolland Neve: Yes. Mayor Laufenburger: Could you just step to the podium for a moment? Rolland Neve: I have two more by the way. Mayor Laufenburger: Okay. Can I see them? I knew there was somebody else. Okay just wait, just a moment. Just a moment. Your name and address please. Kristyn Vickman: Kristyn Vickman, and 1535 Hemlock Way. Mayor Laufenburger: Was it Kristyn? Kristyn Vickman: Yep. Mayor Laufenburger: Nice to see you again. Kristyn Vickman: Yes, I wasn’t going to address but since we’re bringing up more petitions I just wanted to let you know that since we’ve been sitting down here tonight 62 more people have signed the online petition so it’s continuing to go as we’re sitting here tonight and I think if we had more time there would be hundreds more people if not thousands who would be signing this. I was going to read through the extensive comments that everybody made on the online petition so you guys could understand from these 300 that I have on here, that these are not just people signing their name. That they actually have feelings and thoughts and concerns about all of this. Because it’s almost 10:00 I’m not going to do that but I just want you to know that the things everyone has said here tonight are the things that have been voiced in this online petition as well. There are hundreds of people who live in this town who do not want this. We are asking that you vote no on the TIF. Mayor Laufenburger: Thank you Kristyn. Rolland Neve: Did you have some questions for me Mayor? Mayor Laufenburger: Yeah this, just help me understand this petition. This was the signature. Is there more than one petition? Is your petition different than this other petition? 59 Chanhassen City Council – September 11, 2017 Rolland Neve: It’s essentially one petition saying that because of such and such and such and such and such and such, therefore we petition the City Council to reject the funding of the project. Mayor Laufenburger: Okay, so this is a, this is a petition that essentially makes various points. The bottom line is those who sign the petition, Chanhassen residents or otherwise say. Rolland Neve: Only Chanhassen residents. Mayor Laufenburger: Only Chanhassen residents have signed this? Okay. Rolland Neve: That’s right. Mayor Laufenburger: Alright. Thank you very much. Rolland Neve: And the evolution of the petition was additional facts that were added to but the basic petition was unchanged. Mayor Laufenburger: Okay, alright. Thank you very much Mr. Neve. One last call. Alright with that I will close the public hearing at this time. Ladies and gentlemen I’m going to ask that you indulge us with just a 5 minute bio break if you wouldn’t mind and we will come back and then take, take up this action so we are going to recess at 9:57 and reconvene about 10:05, okay? Thank you very much. Nann you got that? (There was a short recess at this point in the meeting.) Mayor Laufenburger: I’d like to bring this council session back to order. Thank you for giving us that break. I hope some of you appreciated that. At this time I would like to bring this back to the council for questions, comments or action. Anybody? Mr. Campion, start with you. Do you have any questions or comments? I’m demanding that you do but. Councilman Campion: Not at this time. Mayor Laufenburger: Okay, alright. Anybody else? Councilmember Ryan? Councilwoman Ryan: Thank you Mayor. I have a question that’s somewhat rhetorical in nature and then I’d like to explain my question but the question that I have is why does this TIF vote have to happen so quickly because it feels very rushed to me? I put together a slide here. Could we put that up on the screen please? And I just, I’ll wait until it’s up. Thank you. And this relates, you know it’s a little hard to see but this really relates to the process for which the vision study and downtown focus is going as well as the Venue/Aldi development and because I like a literation I decided to call it a Tale of Two Timelines. So if you look at the downtown focus and th see that on January 7 of this year, every year at the beginning of the year we as council meet 60 Chanhassen City Council – September 11, 2017 and establish what we call key financial strategies. It’s something that we work off of for the entire year and each of the council members bring forward, brings forward their ideas that they want to focus on for the upcoming year and after we go through a couple iterations of it and rank rd it, we compile a final list and it’s our Key Financial Strategies list. On January 23 the City Council unanimously voted that the downtown update and vision study was going to be ranked as our number one along with one other item as our number one top 2017 priority. Fast forward nd to May 22 in a work session we discussed hiring a consulting firm to provide this downtown vision study so they were going to do the research. Staff presented us what information they were going to present to us and get back to us because we knew that something was going to be done in our downtown and we wanted to make sure that we totally understood the impact of that. th At our June 12 meeting at City Council we then approved this 3 to 4 month study on our downtown area and the results from that study would be tell us about the current conditions, trends, zoning. If there needed to be zoning changes. Various alternatives and preferences. th Some of the, and then on August 28 we received an update from the consultants at a work session but told not to expect a final draft until January of 2018 with some other elements intermingled in there so the consultant was going to go and talk to different business entities. Publish some results to get comment from the public and so this is all going to take place from January through December with a final vision study not until next January. At the same time, or th you know along a different timeline we have the Venue/Aldi development and on December 12 of ’16 at a work session we were presented the Frontier concept plan and it was just a concept. It was basically of an overview of what the project was going to be and that they possibly would be requesting TIF money. We didn’t hear about, this never came back to our work session or a th council meeting until July 10 when the City Council was asked to approve a full plan. A full plan approval for this development. There was not another work session and so it only had gone through the Planning Commission and then onto City Council for final approval and that thth happened on July 10. July 24 at another City Council meeting it was voted and 3-2 in favor to th prepare TIF plans. August 28 work session we got an update from staff about some of the th questions that we had presented at our July 10 meeting and nothing had changed. It was just an update that everything seemed to be in working order and then we were presented with the th redevelopment agreement and some alterations. And then here we are tonight on September 11 and asked to vote on establishment of a Tax Increment Finance District #11 and so when you look at this, my concern is that we are, and we had asked at previous meetings to delay the vote on the plans until we received the vision study and here we are voting on $1.3 million dollars in funding for a downtown project when we don’t even know what the conditions are. Trends. Zoning. Alternatives or preferences from the people which we represent so that’s very concerning to me so with that, Mr. Mayor I would actually like to make a motion. Mayor Laufenburger: Alright, make your motion and assuming it receives a second and then we’ll have discussion on it so state your motion clearly. Councilwoman Ryan: Okay. I would like to make a motion that the City Council delay the TIF th vote on the proposal before us tonight until our December 11 meeting with a direction to have a completed vision study which includes public comment. 61 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: Okay. So your motion is to delay or continue, delay until, continue to th another meeting. Vote on December 11. Okay. Just a moment. Mr. Knutson, is that motion a valid motion? Roger Knutson: Yes. Mayor Laufenburger: It is a valid motion, okay. We have a valid motion to essentially continue th or delay the action of tonight until December 11. Is there a second? Councilman Campion: Second. Mayor Laufenburger: Alright, we have a motion and a second. At this time is there any discussion on this? Councilmember Ryan, would you like to speak on behalf of your motion? Councilwoman Ryan: I made the motion based on the information that I just presented. Mayor Laufenburger: Okay, alright. Anybody else wish to speak on this? Councilman McDonald: Mr. Mayor. Mayor Laufenburger: Mr. McDonald. Councilman McDonald: This is a good timeline but I think it’s a little disingenuous. At that meeting we did receive word that one of the things that could happen to downtown is we need more density. That’s an important piece that came out of that. What they talked about was that more density would help support more development in a downtown area and part of what they’re looking at for the vision study is again what could we expect based upon market but it was important to get out of that that the downtown could use more density and I think it’s important that you also mention that as part of that meeting in August. That’s all I have to say. Mayor Laufenburger: Alright. Councilwoman Ryan: Mr. Mayor if I could follow up on that. Mayor Laufenburger: Sure, go ahead. Councilwoman Ryan: And to further some of the comments that the consultant made at that meeting was that a development needs to find a sense of place. A development needs to instill place making strategies to help with the marketability. The consultant said that in order to be successful he recommends a mixed use development and to have, make sure that you have effectiveness and connectivity and so those are all things that I think we weren’t sure of when we 62 Chanhassen City Council – September 11, 2017 made the, when it was approved for the development and pieces of information that I think are very important to a development in our downtown. Mayor Laufenburger: Okay. Anybody else wish to speak? Councilman Campion: Mr. Mayor? Mayor Laufenburger: Mr. Campion, go ahead. Councilman Campion: So I do recognize that there would be business benefits from this TIF if it were to go forward. Mayor Laufenburger: Actually Mr. Campion we’re speaking on discussion of the delay. You understand that? Councilman Campion: I am… Mayor Laufenburger: Okay, okay. Councilman Campion: I recognize that there would be benefits for Southwest Transit. For the Dinner Theater and some of the other adjacent businesses. But I feel that the TIF outlined is too narrow in focus and is tailored specifically to this single development and developer. I firmly believe that we should cast a broader net to attract more unique businesses to town that would enhance the character of Chanhassen. Think of something like a curling center. Other entertainment, dining venues, things like that that would offer more character to our city. Or unique retail for that matter. I would like to see the vision study completed before voting on this TIF district to consider zoning changes that would attract this broader variety of businesses that I mentioned. And in my eyes just looking at this right now I don’t see the upgrade of Market Boulevard being worth the placement of a high rise apartment building in the middle of our downtown. Mayor Laufenburger: Okay. Is there anybody else who would like to speak on this? Councilwoman Tjornhom: Mr. Mayor. Mayor Laufenburger: Councilmember Tjornhom. Councilwoman Tjornhom: And I’m just addressing the motion that was made by. Mayor Laufenburger: The delay? Councilwoman Tjornhom: Yes, the delay. I’m looking at the timeline and I, it followed the process that most developments that follow. It went through, it was vetted through the Planning 63 Chanhassen City Council – September 11, 2017 Commission. It was vetted through City Hall and it came to us and we’ve made these decisions and so I would rather not delay it but just bring it on and have council really give their comments and opinions and have a vote of yes or no. Mayor Laufenburger: Okay. Anybody else? There being no further discussion the motion before us is a motion to delay action on the establishment of the TIF District and it’s related th actions until December 11 meeting. Councilwoman Ryan moved, Councilman Campion seconded that the City Council table the TIF vote until the City Council meeting on December 11, 2017 with direction to have a completed vision study which includes public comment. Councilwoman Ryan and Councilman Campion voted in favor. Mayor Laufenburger, Councilman McDonald and Councilwoman Tjornhom voted in opposition. The motion failed with a vote of 2 to 3. Mayor Laufenburger: If you’d like me to I can vacate the council. We’ve had the public hearing. That motion fails by a vote of 3 to 2. Is there any other action or comments this evening? Councilman McDonald: Mr. Mayor? Mayor Laufenburger: Mr. McDonald. Councilman McDonald: I’d like to make a motion that the Chanhassen City Council adopts resolution 2017-61 approving modification to the redevelopment plan for the downtown Chanhassen redevelopment project area and Tax Increment Financing Plan #11 and approves the contract for private redevelopment by and between the Chanhassen Economic Development Authority and Chanhassen Frontier LLC, and approves the public improvement and special assessment agreement with Chanhassen Frontier LLC. Mayor Laufenburger: Alright. Mr. Knutson, do we have a valid motion? Roger Knutson: Yes. Mayor Laufenburger: Alright. Is there a second to this motion? Councilwoman Tjornhom: Second. Mayor Laufenburger: Thank you Councilmember Tjornhom. We have a motion and a second. Is there any discussion? Councilman Campion: Yes. Mayor Laufenburger: Mr. Campion. 64 Chanhassen City Council – September 11, 2017 Councilman Campion: Mr. Mayor, fellow council members. I implore you to vote against this TIF as it’s outlined. I think there’s been a pretty vocal message from the community about their concerns over this and I simply don’t see the justification for the pace at which we’re pushing this through in lieu of $42,000 that we’re spending on a vision study for this downtown. When this parcel is at the heart of our downtown and will undoubtedly impact any further development that takes place downtown. We should take a more holistic look at this and consider all the zoning implications that future developments could have on adjacent properties and what zoning changes might be beneficial to this development rather than simply building on this footprint because it’s fastest. Mayor Laufenburger: Thank you Mr. Campion. Anybody else? Councilwoman Ryan: Mr. Mayor? Mayor Laufenburger: Councilmember Ryan, go ahead. Councilwoman Ryan: I have been against this project from the onset. Not because I’m anti development. Not because I had feelings one way or another about a certain apartment or a grocer. I am against this development because I have not been able to answer the question is this right for downtown Chanhassen. I laid out my arguments against this development at our July th 10 meeting. Vision study which would answer that question is still incomplete. The fast pace at which this development in the heart of downtown has caused me concern. Have we done our due diligence? Are we sure we’re doing this right? Did we do a complete traffic study? The amount of money being given to United Properties is astonishing. $60,000 from Carver County. $719,000 from Met Council in a grant and $1.3 million dollars in TIF from the City. That is over $2 million dollars from various entities to lessen the financial impact to United Properties. Less of their own capital equaling less financial risk in this project. As I asked before if it’s risky for a developer worth billions why isn’t it risky for Chanhassen? Since then I have continued to receive comments from this community. Every single one I received has been in opposition. Other than a few people that spoke tonight or the 3 emails that were in our packet I haven’t received one email of support. I realize that Chanhassen isn’t the last frontier anymore and that we continue to grow and develop but let’s do it with a purpose. With a vision. Why are we financing a private development with public money? Why are we in such a rush to approve this TIF district? Does United Properties want the TIF or does the City need it to help fund various infrastructure projects that maybe the County or the City come up short. For example Market Boulevard. Lyman Boulevard. Galpin. I can’t answer those questions either. What I do know is that this project moved through with lightning speed. One session. One work session. One Planning Commission meeting. One City Council meeting and the development was approved. And for TIF. For supporting $1.3 million in public money, one Planning Commission and one City Council meeting. So add it up. Five meetings to approve what will be the centerpiece of our downtown. Five meetings. There have been dozens for other developments like Avienda. Ultimately we will have more meetings about the downtown vision study than the development 65 Chanhassen City Council – September 11, 2017 that falls into the area of review. Fellow council members I urge you to vote against establishing TIF District #11. There are too many unanswered questions which makes it not right for this city. Thank you. Mayor Laufenburger: Any other discussion points? Councilman Campion: Mr. Mayor, one more point. Mayor Laufenburger: Mr. Campion, sure. Councilman Campion: One thing on this timeline that doesn’t necessarily jump out at you is on th June 12 when we approved the 3 to 4 month downtown vision study that was you know what th was intended for the contract. You know June 12 is when we approved it. It should have started then. It should take 3 to 4 months so it should have been done in September-October th timeframe. And instead what we found at August 28 work session was that the consultant came back and laid out this timeline that instead of taking 3 to 4 months took double that. And when I asked them if they could complete this study faster they said yes we could but it was being gated by staff’s availability to support it. Mayor Laufenburger: Say that again? Councilman Campion: I asked the consultant at the work session, it wasn’t in the Minutes but I asked the consultant when we were sitting at the table in the work session, I said could this schedule be compressed and he said certainly and I said why not and the answer back was it was staff’s ability to support it. Mayor Laufenburger: Mr. Gerhardt or Ms. Aanenson are you aware of those comments? Kate Aanenson: No. I’m not aware of those comments. The contract didn’t get executed right away. We talked to the developer today. We’re trying to move that up to December. That last meeting in December. I put in your memo but no, it has nothing to do with staff’s timeframe. Councilman Campion: Did anybody else hear that? Councilwoman Ryan: Yes. Councilmember, or Councilman Campion did ask that question and that was the feedback from the consultant. Mayor Laufenburger: And that concerned you Mr. Campion? Did you bring that to staff’s attention? Councilman Campion: I asked it in front of staff at the work session. Mayor Laufenburger: But it wasn’t in the Minutes. 66 Chanhassen City Council – September 11, 2017 Councilman Campion: They’re not verbatim minutes from the work session. Mayor Laufenburger: Okay, so was it during the work session or was it after we concluded? Councilman Campion: No it was sitting at the table at the work session. Mayor Laufenburger: Okay. Alright. Thank you for your comment Mr. Campion. Kate Aanenson: I just want to be clear, I have no intention of trying to undermine anything in this process. It’s our goal to get the vision study done. We were the ones that felt strongly about it because Avienda, the project that is twice as big as this, we were concerned about that usurping what’s going on downtown. Mayor Laufenburger: Right. Kate Aanenson: We’ve always been a champion of downtown and certainly I’ve never done anything to try to circumvent that process and if that came out that way. Councilman Campion: I’m just repeating that is what the consultant said. Mayor Laufenburger: Thank you Mr. Campion for your comments. Anybody else? Councilwoman Tjornhom: I’d like to make some comments. Mayor Laufenburger: Councilmember Tjornhom. Councilwoman Tjornhom: What a night this has been. This has been a really I think probably the most heated, contested development I’ve probably been through. I’ve been answering my phone and people have screamed at me saying that I am somehow gaining financially from this. That I can’t think for myself. That I am, and Vicki you’re just laughing at me once again. Vicki Ernst: I am. Councilwoman Tjornhom: Why are you laughing? Mayor Laufenburger: Would you, please. Those in the chamber would you allow the council members to speak. Councilwoman Tjornhom: It’s distracting. Vicki Ernst: I can address her. She addressed me. 67 Chanhassen City Council – September 11, 2017 Audience: If we can’t do it, she can’t do it. Councilwoman Tjornhom: And I’m not. I’m going to start over. Like I said this has been a very emotional, heated discussion and I know it stems from the fact that we all want, we want our community. We want our homes to be safe. We want our roads to be drivable. We want to be able to work here. We want to be able to live here and we all want the same things. I think sometimes though we just visualize it differently. I don’t find this to be a threat. I don’t find this apartment building to be a threat to our community. I see it as, if you all look back in your lifetime we all started out, we all lived in an apartment or most of us did. We started somewhere and then we gradually moved on and we became homeowners. Then if we now fast forward to our life cycle now, some of us are getting to the point where we don’t want to own a home anymore. We don’t want that responsibility so we look for where do we go now? We want to stay in our community. We want to stay in our city. Where can we go? Well this apartment building is a perfect example of where someone in that situation can go. Mr. Brindisi talked about his employees will, are telling him that they’ll probably shop at Aldi. I’m guessing that some of them might actually live in this apartment building. I see this place as a place where we can have people that want to live in town and work in town and raise their family in town. Those aren’t bad things for our community. We talk about bringing livelihood to our downtown. The way to do that is to have people in our downtown. You’re right, I don’t live downtown. I live south of 5 and so I go to the place that’s most convenient for me to shop and that’s not always downtown anymore. Let’s bring people downtown where it is convenient to shop. Where they do invest. Where then we talk about we’re tired of the chain restaurants. We’re tired of the drive thru’s. Well let’s be able to provide a restaurant with patrons. Who wants to invest in a restaurant if there’s no one downtown to go and eat there? If there’s no one downtown to work there. I don’t find this as a threat. I don’t find it as a bad thing for our city. That’s why I’m supporting it. Not because I can’t think for myself or that I’m gaining financially. I just think it’s a good thing for our city. Mayor Laufenburger: Thank you. Anything else Ms. Tjornhom? Councilwoman Tjornhom: That’s it. Mayor Laufenburger: Okay. Anybody else? Councilman Campion: Mr. Mayor? Mayor Laufenburger: Mr. Campion. Councilman Campion: One more thought. I don’t disagree with the comments that Bethany made that we do need more density downtown. My arguments are more against specifics on this project that didn’t seem to be truly open for debate. The height of the building was set. When we asked about alternatives for lowering it, it was no. It has to look like this. It has to be shaped like this. This section has to be this tall. This section has to be that tall. And if we go and look 68 Chanhassen City Council – September 11, 2017 at the other KFS cities that we compare ourselves to in every other way in all the financial measures, I was looking at their downtowns. Information I could gather on their tallest buildings. This from what I can tell would be the tallest of our KFS cities. The tallest building notwithstanding Mystic Lake Casino and the Sherburne County Courthouse. All that seems relevant to look at and those other things that were in the neighborhood of this height were not in the middle of the downtown of any of these KFS cities. So if these are the cities that we’re comparing ourselves to and that we think that we want to be like or at least reference ourselves to, do we want to have the tallest building in downtown? Is that something that we’re after? Mayor Laufenburger: Anything else Mr. Campion? Councilman Campion: Not at this time. Mayor Laufenburger: Okay. Before I call for the vote, unless there’s something else that somebody wants to say, there was something that was said tonight that absolutely resonates with me and it was mentioned by, just a moment. Roberta Fernandez. You spoke about the state of the country. You made reference to that and I think that there’s a little bit of a microcosm going on even here tonight. That the views that were expressed predominantly expressed at the podium were views that were substantially, not entirely but substantially based on I’m going to suggest fear of change. The point that Ms. Fernandez made that I think is very relevant is that we have reached a state where we cannot argue in favor or against something without feeling impugned because of our beliefs or because of our interpretation. I read this, and I’m going to read, Mr. Neve I’m assuming this is the petition that you’re referring to right? Okay. Items that will affect you directly. Your taxes will increase. We’ve heard it made very clear that the property taxes which Mr. McKelvey has identified come from United Properties will essentially be funded so this is a tax abatement program. I have had not only assurances but detailed assurances that taxes for other citizens, from other citizens will not be used to, for this tax increment finance district so your taxes will increase. They may increase but they’re not going to increase because of this development. You’ve also heard that Mr. McKelvey has identified a million dollars that he’s budgeted for city fees. Those city fees Mr. McKelvey, you don’t have to answer this, those city fees are not predicated on any TIF district. Those are fees associated with building permits, SAC fees, WAC fees, connection fees, etcetera that will come to city coffers. We don’t have to give them back. They will be used to fund other city activities so your taxes will increase not because of this. Your children’s schools which are already over crowded will be completely overwhelmed. That’s a statement. I think that’s an opinion, not a fact because I’ve already heard from the superintendent that our schools can accommodate more. People will be parking in your neighborhoods, in front of your houses and on the city streets including parking on th Chanhassen’s main street, West 78 Street. We have parking laws that are in effect that would prevent that from happening so I can go on here and I understand that this is a motivation and an emotion evoking document and I appreciate that there are 750, now maybe 800 people that have signed this but you’re signing this based on purely emotion I believe and not what I would describe as facts. So Ms. Fernandez, the public hearing is over. This is an opportunity for us to say. 69 Chanhassen City Council – September 11, 2017 Roberta Fernandez: You called me out. Mayor Laufenburger: No I didn’t call you out. I said your words evoked an emotion for me and that emotion is the only argument that you folks that are predominantly present tonight are looking for is an argument that supports your position and I think it’s important to understand that there may be other positions that are present so I think that you’re welcome to connect with me Ms. Fernandez after the meeting if you’d like to discuss this further but at this time I would, unless there’s other comments that are made by the council, okay. We have a motion in front of us. That motion is, could you bring it up on the screen Ms. Aanenson please? This is a motion by the City Council, just to remind everybody that this similar motion needs to be acted on by the EDA at the conclusion of this meeting. So this is the proposed motion in front of you. Resolution #2017-61: Councilman McDonald moved, Councilwoman Tjornhom seconded that the Chanhassen City Council adopts Resolution 2017-61 Approving Modification to the Redevelopment Plan for the Downtown Chanhassen Redevelopment Project Area and Tax Increment Financing Plan No. 11 and; approve the contract for Private Redevelopment by and between the Chanhassen Economic Development Authority and Chanhassen Frontier, LLC and; approve the Public Improvement and Special Assessment Agreement with Chanhassen Frontier, LLC. Mayor Laufenburger, Councilman McDonald and Councilwoman Tjornhom voted in favor. Councilwoman Ryan and Councilman Campion voted in opposition. The motion carried with a vote of 3 to 2. (There was a short recess in the meeting at this point.) COUNCIL PRESENTATIONS. Mayor Laufenburger: Any council presentations at this time? Councilman McDonald: Mr. Mayor? Mayor Laufenburger: Mr. McDonald. Councilman McDonald: I’d like to add something that I’ll need your help with because I can’t remember all the names and the details but I did want to report because at the last council session it was asked about how the Red Birds did. I actually they think they did really, really well. Unfortunately they ran into a team that has been planning on winning this championship for over a year and they staffed their team accordingly. What it all came down to was a best 2 out of 3 series and wow, we won the winners bracket undefeated. When we got into the final game it came down again they had to win two straight. My hats off to the Mudhens. They did win two straight and they won it very convincingly I think showing that they were the better team but the Red Birds showed a lot of flash and courage and talent and I have every bit of aspirations that next year we will be in the championship circle. 70 Chanhassen City Council – September 11, 2017 Mayor Laufenburger: Okay. Just as a by product of that too. Four members of the Red Birds were named to the All Tournament Team. I want to recognize them. Logan Spizak, a pitcher. Zach Hoffman, our first baseman and designated hitter. Justin Anderson, second baseman. Also a superstar hitter and Adrian Turner, a coach at the local high school and not only a pitcher but he hit a home run in the very first game that got Chanhassen Red Birds going so I echo your sentiments. It was good. Now we move beyond baseball into something else until the Red Birds come around next year so congratulations Red Birds. Any other council presentations? ADMINISTRATIVE PRESENTATIONS. None. CORRESPONDENCE DISCUSSION. None. Councilman McDonald moved, Councilwoman Tjornhom seconded to adjourn the meeting. All voted in favor and the motion carried unanimously with a vote of 5 to 0. The City Council meeting was adjourned at 10:40 p.m. Submitted by Todd Gerhardt City Manager Prepared by Nann Opheim 71