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1989 12 21HOUSING AND REDEVELOPMENT AUTHORITY REGULAR MEETING DECEMBER 21, 1989 Vice Chairman Horn called the meeting to order at 7:3~ p.m.. MEMBERS PRESENT: Clark Horn, Tom Workman and Jim Bohn MEMBERS ABSENT: Cliff Whitehill and Charlie Robbins STAFF PRESENT: Don Ashworth, Executive Director and Todd Gerhardt, Asst. Executive Director APPROVAL OF MINUTES: Bohn moved, Workman seconded to approve the Housing and Redevelopment Authority Minutes dated November 16, 1989 as presented. All voted in favor and the motion carried. VISITOR PRESENTATION: None. UPDATE REGARDING BERNIE HANSON. Horn: Tom didn't get here earlier but we have some good news to celebrate tonight. We've reached agreement with Bernie. Workman: Marvelous. Horn: So we congratulate both Bernie and Don on their efforts. Is there anything else we want to discuss on this? Gerhardt: No. Just Don updated everybody previously, before the meeting started. It's good negotiations this past week. Workman: It wasn't a compromise because I wasn't here? Gerhardt: That had something to do with it. Horn: I guess the only thing I could say is, this has been a project we've had in the mill for a long time. I'm really glad to see you're going to stick around with us Bernie. Bernie Hanson: Well we're trying. Workman: I can find out details later perhaps or are we going to vote on anything. We don't have to vote on that tonight? Horn: No. No, it's all resolved. UPDATE REPORT ON HWY 1~1 AND HWY 5 (FRED HOISINGTON). Horn: I think this ~tem has been around longer than our negotiations with Bernie actually. Housing and Redevelopment Authority Meeting December 21, 1989 - Page 2 Fred Hoisington: Actually we started this about a year, Just about this time last year as a matter of fact. However Clark you're right because we've been dealing with this whole question of the intersection here and all the alternatives for the past, at least the past 2 years so that's right. This study though was one that had several different purposes and one of them, the primary one was to establish the alignment of TH 101 down here but also to deal with corridor aesthetics and deal sort of secondarily with land use but the land use portion of this is the part that you're really most interested in because the tax increment district for us includes virtually everything that's here and then it comes down to the south line, I think of the Ward property or there abouts in this case. The area you kind of want to concentrate on is this area right through here because I know you're not really all that concerned as an HRA with the realignment of TH 101 but. The two areas that are probably the most important or the things you'll be most interested in have to do with the Ward property itself and then because Brad is here, we want to talk a little bit about his proposal for the land on the north side of TH 5. The Ward piece as you know is about 77 acres in size and this alignment of TH 101 is pretty much established a pattern of land use that is different than we ever had 'envisioned before. The property is presently zoned industrial, or at least everything on the west side of existing TH 101 and every on the east side is all residential currently. What we decided to do was to kind of look at this south side and get some impressions of what kinds of potential for other uses might be there or whether the uses all remain the same and one of the things that we had always kind of looked at was the extension of Lake Drive as a continuous road all the way through this corridor. Sort of a parallel route so you did not have to, everyone didn't have to use TH 5 to get through here, especially the people that were employed and needed to move from one place in the community but not use TH 5. What happened was that when we began to look at this site and realize it's commercial potential, we decided that we needed to detach this at least 6~ feet so the people coming into this site from this direction wouldn't make a left and then immediately have to make a second left. Because we were concerned about the congestion that would occur and the backing of traffic onto TH 5 we decided to give it the maximum use potential, we would detach that and what that does is it gives us Just a tremendous amount more stacking distance and also we didn't lose that much in terms of continuity. In fact we think this will work extremely well because people are really interested in driving here and getting on or here and getting on and so forth so there really wasn't a necessity to keep it up here and we were concerned about use here as well. One of the things that we were fearful of was if we didn't make this large enough piece, we would end up with a strip of commercial along the north side. Very attractive for fast food restaurants and those kinds of things and we'd thought we'd end up kind of with a restaurant row there which we were, not to say that I'm not all that concerned about but I was much more interested in having a large block of land that we could use and deal with as a unit. Horn: The only people you interfere with are the Rosemount people who want to go to McDonalds for lunch. Fred Hoisington: That is correct. Well, not really Clark because this is their entrance right here so they can get directly out of there and get up Housing and Redevelopment Authority Meeting December 21, 1989 - Page 3 in that direction with no difficulty at all. Horn: So the Rosemount is across from that? Fred Hoisington: Exactly across from this so what we did is we aligned that deliberately to go right into the Rosemount. Horn: So if the Empak people want to go to McDonalds. Fred Hoisington: The Empak people are going to have to be a little more secure to get there than the Rosemount. So that's the rationale for circulation and so forth and we're not exactly sure what will happen there but it has a tremendous commercial potential. Other things though that you might be interested in, this site on the west side of future TH 101 is a rather steep piece of property. Quite heavily wooded as well and we see that interchangeably useable for multi-family or office but we've shown it on this plan and I think the Planning Commission is probably reflecting it much this same way on their plan. If someone came along with a good office plan that worked and where they could step it down the slope and so forth and preserve trees, then I have no problem with office there either but in any case, multi-family seems to make the most sense with this exposure out to the lake and so forth. It seems to be a real good use. Talking about office here and then sort of a transitional zone here with single family for the most part backing to single family and then the small area of multi-family that is somewhat different than you've seen in the past. But that's sort of the extent of the Ward piece and the things we're proposing there and the Planning Com~,ission is incorporating all of that in their Comprehensive Plan. The area on the north side, this being existing TH 101 or Great Plains and future TH 101 at Dakota Avenue, this is probably one of the more difficult pieces of land that we found in this entire study and the reason, if Brad would pay attention, since we're on your stuff kind of Brad. The reason this is so difficult is because of the dimension of it. Not only do we have a railroad track on one side and TH 5 on the other, but when you get down in the vicinity of Apple Valley Redi-Mix, you have 130 feet or 150 feet of width, something like that. A very narrow site and access is always going to be a problem, for that site. If you're familiar with plans for future TH 101, which as you know have been funded or at least we have the tax increment district extended, there will be a median across here so we will not be able to get directly out and have all directional maveurability at that intersection near The Taco Shoppe so what we're suggesting in this case is that there be a private driveway through on the north side right along the railroad tracks and that gives better utilization of the land to the property owners there and if we had a public street, we wouldn't have much left. By the time we ended up with setbacks and everything through here, it simply wouldn't work and you do make some provision in your zoning to have private drives if they don't serve more than 4 properties and that sort of thing so with cross easements we think that could work very well. So we see kind of a billboard use here. Not billboards but uses that kind of act as billboards. They need exposure but they don't necessarily need immediate access. In other words, someone doesn't have to get right off TH 5 there. They can see it. They can pass it and they can come back to it. So that's sort of the use we see here with an open space use at the end and using part of the Taco Shoppe Housing and .Redevelopment Authority Meeting December 21, 1989 - Page 4 property and getting rid of, needless to say, Apple Valley. We know that Matt Fisher is interested in that happening. He Just hasn't figured out and we haven't figured out a way to do that but we need to do that. We need to get something going and make that happen. This piece then, where we have a much better dimension, is much easier to deal with as well. That's the one of course that Brad is here for this evening and would like to talk with you about. What he's talking about in this case is a Hardee's or a fast food restaurant here. Of course Amoco doing it's thing and then moving the Brown Car Wash back to the back and. then using the present new Hanus building as some sort of commercial type use. As much as that building can be used for that purpose and we have evaluated a plan, I don't know if you got that in your packet or not. Did they get anything in there Todd? It would have been loose. Not in the report but in the... Gerhardt: The drawing? Fred Hoisington: The report that we did on this. Horn: No, we don't have it here. Fred Hoisington: Okay, well let me just explain to you that we think that the use as proposed in concept, or the fast food restaurant which is detached from TH 5, and of course Amoco and the car wash is a good use given the zoning and the exposure and all of the things we had envisioned happening at that location. We have some concerns in detail about what Brad is proposing to do but based on some of the flexibility we see there, we think we can get around and resolve all of those problems without any difficulty. Let me get a drawing here so you can at least see what that looks like. Put yours up too Brad. That will help. Workman: You saying we do need a car wash? Horn: Yeah. Fred Hoisington: The car wash would come down. The present one which is out here right on the street and would move back to the backside of the property and then there would be service bays, office and then parts storage and so forth here. Access to the car wash would essentially be through here and across the Amoco property and access to the drive-up restaurant would be in this fashion. Horn: Now Amoco's come in with a plan. Is that this plan? Fred Hoisington: Basically that's this plan. After having been here before and having been delayed and so forth, this access for example Clark is right across from West 79th Street and that was one of the critical things that we felt had to happen here. Horn: Right. Is that consistent with MnDot's staff's recommendation? Fred Hoisington: Yes. What they wanted originally were 2 and we and MnDot said no. You're going to have one and they still wanted to pursue 2 but when it came right down to it, they decided they better have one because Housing and Redevelop~,ent Authority Meeting December 9.1, 1989- Page 5 they weren't going to get 2. Horn: They can still go out here though right? Fred Hoisington: Yes. Yes they can. Now the problems ~e have with what you see here are resolved in the other drawing that's attached. What you have is, you have 2 way traffic on this aisle and. then you have traffic coming, opposing traffic, what you have is 3 way traffic on that thing and they were not proposing an island back here to separate that traffic. What we're suggesting is you can do it in one of two ways. You can put an island in and separate it and we think that potential exists. Or you can do as we've suggested on the page just preceeding and that's to move the restaurant all the way to the south line or nearly the south line and have the drive-up on one side and all of the inside patron parking on the other side and eliminate the 3 way traffic and end up with 2 way traffic and force the people who go through the drive-up, which you know it takes about 5~% to 6~% of all the business goes through a restaurant of this nature, goes through a drive-up window. Would put that traffic here rather than put it all here as it would on the other plan. One of the things we know about drive-up restaurants is you also don't need any parking spaces and your ordinance requires 8~ parking spaces. That's a lot because of the driveway up window and what we're suggesting is you could allow 5~ and you'd still be okay as far as that's concerned. Horn: How many are at the Hardee's in Eden Prairie? Fred Hoisington: I'm going to guess. Horn: Hardee's or Burger King. Fred Hoisington: Four? Horn: Four and five. Fred Hoisington: I've never seen it filled. Horn: Oh I've seen it. Fred Hoisington: There are none on the one side and all of them are on the other side, that one's a pretty well designed one. It divides things up. Horn: I've seen it full. That's a busy one though. Fred Hoisington: In any case, relatively minor differences and things we think we can be worked out and we agree in concept with what they're trying to achieve. I guess the major concern is whether the Amoco folks will allow this to occur. This circulation across their property to get to the car wash. If they won't allow that, obviously the plan doesn't work but if Brad can get approval for that, then we've got a plan that I think works very well. Bohn: Is Gary Brown willing to, does he go along with this? Housing and Redevelopment Authority Meeting December 21, 1989 - Page 6 Fred Hoisington: We understand that Gary is most interested in doing something like this. Brad Johnson: Of course he'd like to have it on that corner... Bohn: Who's going to own the car wash? Fred Hoisington: He is. Bohn: He owns the property now the car wash is... Brad Johnson: If Fred's done, I can take you through that. Horn: Looks like either option might be viable at this point. Brad Johnson: Let me just show you where the HRA kind of fits in. Horn: It sounds like the key is Amoco on this deal. Brad Johnson: Well initially it's kind of Brown. First step. You know where the site is and we've had 2 or 3 people come to town with fast food type of restaurants. Given all the sites in the community, they feel that's one of the better. Workman: Where the car wash sits? Brad Johnson: Yes. And so we've got a site that's being relatively unutilized. I would think the valuation on that site right now as a car wash for tax purposes is probably about $1~,~0.0~. Amoco's going to spend a million dollars on their new station. So what we're proposing I think is an increased in valuation on that corner with the Amoco and everything like that, probably around a million for tax purposes approximately. And the area looks like this. There's a whole bunch of looks to me, there are a number of different ownerships in that area and this one kind of details this particular plan. This is owned by Amoco. Brown owns about 1~,~ square feet here. This was owned by Kerber's first and by Lotus. There's a parcel, these parcels have been connected, there's a line about right here and that is what you perceive to be the Hanus garage. That's owned by a compan~ called Minister's Wife with an option from us to purchase it. Then there are a number of parcels, one, two, three that go all the way back and sort of start a road and go all the way back into the Apple Valley concrete area. I think a lot of you guys have seen this map a number of times. What we're proposing to do on our first is one, as Fred said, is get adopted in concept at least this is how you'd like to see this whole thing work someday. Okay? Recognizing that.., and then this proposal, is that right, deals with this part right here. That will stand alone traffic wise and then later on as potentially they do something with Apple Valley where we all kind of work on getting that done. Then they'll probably have a road that will come through. As I said the one barrier that you have right now is this. I think long term real benefit to Apple Valley...or HRA buys it and sells it again, will have to have a road through here otherwise it's a one way in and no way out kind of situation ultimately. So the road here does make sense and then we should Housing and Redevelopment Authority Meeting December 21, 1989 - Page 7 have an option agreement signed with the parties...to sign to do something like this. Why this works is the concept is one, Brown needs to find a new place to have service where he can service cars. His car wash is going to, it's sort of out of date in comparison to the new kind of car washes. They're mostly doubled loaded and a little bit bigger. Three, aesthetically it's located possibly not quite in the best place. The setback from our major road is about 2~.feet. That's maybe not enough. So when Hardee's reviewed the site, they said let's try to...here. Can you talk Brown into selling the car wash? I think that can be accomplished. If we move the car wash to here, he would purchase the end of the Hanus building. That square little one and that would become his service. One of the hang-ups he's got is he never wants to be a tenant again on that corner because of what he perceives he's gone with Amoco and then he would set up about a 6,00~ square foot, about 5,00~ square foot service center which is the same size as a Goodyear store would normally be. That would allow him to be in the tire business and all that kind of stuff, and then he could have a car wash attached to it. Now I guess we're just dealing with concept right here. We talked to Amoco and they would like to get rid of this car wash up here because they perceive it's also not go6d for their property to be there. It detracts...so I think they would cooperate. The assistance that we would need from the HRA is probably, I think we'll generate about a million five of increments in this projec{ is a normal 3 year kind of land write down and assessment. And that would be used basically to buy the parking. Buy Brown's interest on the car wash and relocate it to the back. -Possibly some assistance in land write down and then we would have to have the City to agree to vacate 79th Street there. The property that 79th Street is on is owned by Lotus and leased to the City. It's actually owned by Hanus in a way...major area of assistance that would be needed which is very legitimate for this kind of area when you're doing renewal, is about 3 years of increments from the projects we created. Hardee's does not require any increment with what they're trying to accomplish. Amoco requires no increment with what they're trying to accomplish. They can pay market rate because their relocation of Brown and changing that road system around, probably takes some of the increment. We would not have to go out... Horn: Does Hardee's have any new architecture that they're dealing with like some of the other fast foods are changing their looks? Are they still the standard. Brad Johnson: I'm not sure. I think they're basically the same. As far as they've shown us... You've got issues like signage. Our current signage, I was just talking to Fred, some of our signage standards, we haven't had a fast food put in in Chanhassen for 1~ years. We've rewritten all our signage, a lot of our ordinances inbetween. Right now we're working with 3 fast foods. Each of them probably have a problem with our existing sign standards. Just based upon... Horn: Are any of them a little more creative in their building style? Brad Johnson: They usually stay with what is the same. Housing and Redevelopment Authority Meeting December 21, 1989 - Page 8 Horn: When you look at the new, like the new McDonald places now and some of the Country Kitchens are really starting to take on a different look. They don't look quite as, there's one. Brad Johnson: I don't know. They have their standards. I know everybody is going through changes all the time. You look at the new Arby's. There's even one over by Eden Prairie. That's a real sharp one. Horn: That's why I mean. Some of these people... Workman: We have 3 different fast foods looking at the same location? Brad Johnson: No. Hardee's is the one that's interested in this one. We have other people looking but Hardee's got to the place first and now they're looking back towards the City over by the shopping center. Workman: In that outlot? Brad Johnson: Yeah. That's what we always thought we'd get somebody in there. They're also looking, they want to be closer to TH 5. We just don't have a lot of stuff near TH 5 that's easily available and in the city. We can push'them toward Eden Prairie and Dell Road or someplace like that. I don't think that's good for the downtown because the more traffic we continue to generate for the downtown, the better. Workman: In a general direction of our theme for downtown, you mentioned signs and we're going to look at the hotel a little later and everything and we're doing things all, you know the Riveria's throwing that on top. Brad Johnson: I don't perceive that's the problem. Signage is a business problem. Workman: But what I'm getting at, then all of a sudden you've got a 4 inch square Hardee's. Brad Johnson: This one's going over in the BH district. Workman: I'm talking about eventually that outlot or when somebody makes their entrance on Frontier Trail into town. They see the clock but they see an orange Hardee's. How does all of that fit in with our plan? Are we taking that into account? Brad Johnson: You have a choice of having, when you get down to the basic economics of it all, the people that come in as retailers, the businesses have to work. I don't think you can dictate to the businesses how they work. Their architectural style because they approve it... Workman: Right but what I'm saying is, there's a lot of time and energy has been spent trying to make this design, both Market Square and the Medical Arts and off of the Dinner Theatre and everything else like that. Now we're just kind of throwing these in there a little bit. Housing and Redevelopment Authority Meeting December 21, 1989 - Page 9 Brad Johnson: We're dealing basically with highway uses. We feel that we're upgrading that corner. Workman: Yeah. No, I understand that. I'm not telling Hardee's how to build. I'm just wondering overall how that. The entrances to our city are going to have these things. Maybe that's okay. Horn: I think we're all fighting with that issue Brad. I like this overall concept and if we could get a fast food in there that's got a little bit more modern styling, I think everybody would really go for it. The only hang-up that I think we all have is, an orange building sitting right in the middle of our nice new downtown. Bohn: Is it McDonalds or Burger King, one of the cities made them change their architecture which they did. I can't think of who it is. Clayton Johnson: There's a Hardee's in Red Wing that is very unusual. Brad Johnson: Hardee's has done a lot of unusual buildings. Horn: Maybe that's what we need to see is something that's a little different than. Clayton Johnson: Herb and Carol did that. Horn: Oh did they? Clayton Johnson: Yeah. Brad Johnson: They've gone into downtown Mankato, have you been down there? They've been sensitive to kind of situations. Detroit Lakes. They went into downtown and really put in a nice. Horn: Hardee's? Brad Johnson: Yeah. Right in the downtown. As a matter of fact, it's a corner just like this. It's been very successful. You just have to realize from their end, they'll give you quotes on, if they don't have the proper signage and property, their business goes down accordingly and that's the business. Right now, you have to kind of listen to them because we're not in the restaurant business. Whether it's that or gasoline or whatever. Signage is important and one of the values is TH 5 exposure to these guys and we'll have to work through it. Bohn: You still can ask them to change their appearance. Brad Johnson: You can't. They'll just go to a different community. Bohn: Then they go. Brad Johnson: You see what you have to realize is, I mean I'm not saying, they may be able to change it. It's like trying to change an Amoco station or changing this, is that their whole advertising program is their Housing and Redevelopment Authority Meeting December 21, 1989 - Page 1~ building. Bohn: Obviously they did it Red Wing. Brad Johnson: They took over a whole depot. It was a reconversion. They went in the depot. It's sort of like, have you seen that one in, it wasn't a new building. Workman: That's usually where the McDonalds end up different. They've taken an old historic building or something. Brad Johnson: If they take an old historic building, they could do it but we don't have one. I think they all become sensitive to the issue but all I'm saying is, you have to be kind of sensitive to, you don't want the business to fail. And their business systems, whet~er it's Arby's, Hardee's, any of these guys. Amoco, is based upon the styling of their buildings and being consistent throughout the United States. Horn: But their competitors are changing. Brad Johnson: As I said, I think they have changed. They probably don't change their signs. They have to leave the building configuration the same because it works that way. It's just the way it works. Horn: The inside. Brad Johnson: Yeah. The basic configuration. I think they do change things around outside. Horn: I think what you're hearing from us is we like the overall concept. We're a little concerned about the looks of the traditional Hardee's store right there. Fred Hoisington: I think we're going to want rather sumptuous landscaping on this... Brad Johnson: Of all three, I think Hardee's from what I can tell in small towns, are a little more sensitive. Workman: Who are the other two? Brad Johnson: Arby's and Dairy Queen. I think you'll end up with 2 or 3 of them. As you add the Rosemounts and stuff, that's just going to attract, it just creates traffic. We need traffic. You've got a couple restaurants in town that aren't getting traffic because they're located downtown and nobody knows they're there. But the more people come in, the more they...so this is more of a concept presentation. I think we agree with Fred so that's good. As far as how we do the site plan and stuff, we'd be back probably starting through the Planning Commission in January. We would need some assistance in relocating Brown and changing that road around. As I say, we'd stay within the 3 year district kind of a concept because there is quite a bit of increment generated on that corner right now. Housing and Redevelopment Authority Meeting December 21, 1989 - Page 11 Workman: Are you looking at about a year and a half from now then? Brad Johnson: To be in? Workman: Yeah. Brad Johnson: Next su~er. Workman: This coming summer? Brad Johnson: As I said, from the HRA's point of view, your one goal was to renew a corner and we think this is a good way to do it and generate a couple million dollars of new value. It solves Brown's problem. Horn: I like that part of it. I like the use. I think it's great. That's our only reservation. Brad Johnson: And I think that can be worked through. We've been telling everybody, we had Dairy Queen in and they said well they want to go... They're trying to modify but it's just tough but I think they can share some of their problems and maybe you can always work those out. You have to see it through their eyes and just try and reflect on what they're doing. One of the concerns we have is signage because it really, getting cars, in talking to Fred, getting cars off the road for lodging and food, let's talk just about the Riveria and people like that. Horn: Well TH 5, that shouldn't be a problem. People just want to get off · the road. Brad Johnson: But they don't know what's here. Horn: Well they don't care. Just so they get off TH 5. Brad Johnson: We're talking as a 4 lane highway. But I appreciate your time and we'll come back with kind of a... Horn: No, I think it's a great use. Brad Johnson: How about the concept of 3 years of increment that we'd use normally in that span. Using that standard, what do you call it, the assessment breakdown program to try and accomplish. That's the one they've been using downtown. Horn: Yes. Is it consistent with what we've done in the past? Ashworth: I would say so. We're looking at some very broad concepts at this point in time but we're talking about moving streets and what not. One part of it's going to be the acquisition of the Brown's car wash. Brad Johnson: I think I've worked that through development so it's not real expensive. Housing and Redevelopment Authority Meeting December 21, 1989 - Page 12 Horn: I think this solves a lot of the concerns of people in that area have. I think it addresses Gary's concern. Brad Johnson: Yeah, it's the first one we've had that he kind of liked what we've had. He gets to stay there and Amoco still builds the station. Horn: They get what they want and he gets what he wants. Brad Johnson: And I think everybody in that whole area has bought into the fact that we need that slip going off TH 101 to come through with that private road because that's a lot of our business. About 30% of the business downtown is coming from Eden Prairie. The more we can encourage that, the better we are. Workman: What's the future, where are we at with Apple Valley? What kind of time frame are we on with that? Brad Johnson: I'll let Don, he likes... Ashworth: It's shown in the redevelopment plan for acquisition but there's no time schedule associated with that. Roger's currently meeting with the attorney representing Taco and that is needed as a part of the new TH 101 realignment. That attorney also represents Redi-Mix and has stated, is there any interest by the HRA or City to move Mr. Fisher. What I told Roger was, why don't we find out what they're asking price is and I'll bring it back to you. My initial reaction is, it's probably outside of our current budget. Horn: Okay. Any other questions on that? I think you got our input Brad. Brad Johnson: Thank you. CONSIDERATION OF APPROVAL OF THE DEBT SERVICE ANALYSIS/PROPOSED 1990 BUDGET. Ashworth: Assuming that you'd like to maybe save the toast to Bernie to the end of the meeting? Horn: Bernie can wait. Do we need to take action on the budget tonight? We are kind of short. Ashworth: Besides that, I'm fighting off a cold and I'd just as soon would like to get out of here relatively early if I could. The budget is relatively simple though. The one jump in salary section recognizes the additional planner that was put on. Sharmin's position. That is an HRA expense. The other area that looks like it's way out of touch is the special assessment payments at $545,~00.00 but that's simply a matter again of your overall tax increment financial plan includes the debt payments. Typically that's not a part of the operating budget per se. I'm not even quite sure why Tom has pulled those out and put them in this section. I don't know if that's the recommendation from the auditors but that amount is consistent with what you had approved last year within that Housing and Redevelopment Authority Meeting December 21, 1989 - Page 13 redevelopment plan. So basically there really is not that much of an increase in the budget per se. I would like to spend some time at a future meeting going through again your overall tax increment, what do we call those? Tax increment revenues, expenditures listing the summary position and putting all of your debt and everything else together in one packet. That's an area that continues to be very healthy. We're staying ahead of projections in terms of revenue. Expenditures are under approved. We have a number of options including cashing the district out early or releasing tax increments on a yearly basis. Again, there's a whole group of options that you can look at. I would propose not to do those tonight. If you'd like to act on the budget itself, that's up to you or if you'd like to wait until the next meeting, that's fine too. Horn: I'd prefer to wait until we had more of us here. Workman: Just one quick question Don. Where's the attorney's fees, etc. listed? Gerhardt: Fees for Service. Ashworth: Yeah, you have fees for service but the biggest portion of your attorney's fees will come out of the projects themselves so when you authorize the downtown redevelopment project and the engineering comes in and estimates the land acquisition costs, and the engineering and whatever, the biggest share of attorney costs are in each of the individual projects. Especially where there's condemnation along with that. Workman: So then most of this is Fred Hoisington? Ashworth: No, there's a good share of attorney in that. . Workman: This is his monthly charge? Brad Johnson: ...you guys were concerned about the architectural stuff. If Fred could be, if we had a meeting with the owners of this Hardee's... Fred meet with those guys and go over your concerns on that and also the site plan... Is that something you want to do? Ashworth: Especially recognizing the comments that were made here this evening, I think that's an excellent idea to have the architect meet with Fred and our in-house planners as well and try to ensure that the architectural style is conducive or similar to what it is that we're looking to. You realize that I'm a little more concerned with what they may be planning for right across the street. The downtown per se is, the whole theme where you start picking up the decorative lighting and all the rest of it, really starts at the railroad tracks so that section on 79th Street that has the regular box lights on it, that first section of TH 1~1, doesn't have the same tree cover, etc.. Horn: What's your pleasure? Do you want to act on the budget tonight or would you like to hold it over until Cliff and Charlie can review it? Bohn: We'd better hold it. Housing and Redevelopment Authority Meeting December 21, 1989 - Page 14 Horn: I think as long as it isn't necessary. Do we need a tabling motion on that? Ashworth: I don't think so. If you'd like you could. Workman moved, Bohn seconded to table action on the 199~ budget until the next meeting. All voted in favor and the motion carried. CONSIDERATION OF ARCHITECTURAL CHANGE FOR COUNTRY HOSPITALITY SUITES. Gerhardt: Including in the report...there was a backside to it also but the Country Hospitality Suites group came in for their building permit and they proposed some changes as a part of that. Due to those changes, we felt they were enough of them that we felt that they should come back to both the City Council and to the HRA for your final review or to give reconsideration for approval on those changes. Tonight Clayton Johnson from Bloomberg Companies is here to go through those changes. I'd first like to list a few that Paul had highlighted. One, that they HRA has tried to express in some of their buildings is to get away from the flat roof and to go with the pitched. The hotel as you approved it this last summer, did have a flat roof. Was somewhat of a mansard, I call it a McDonalds type roof around it. They are coming in with a pitched roof. With the pitched roof you're seeing additional shingling work to be done on that so they are nixing the cedar shakes and have requested that they put asphalt shingles on the roof instead. Another area is that they're reducing the building size. Cutting it back by 12 feet and Clayton will highlight that in his presentation on why they're doing that. One other area was the canopy. It's a 48 foot canopy? Clayton Johnson: It keeps growing but I think it's 48. · Gerhardt: 48 foot canopy and they have some concerns if that can even be constructed or engineered properly to stand. They would like to try to reduce that in size and Clayton will also highlight that in his presentation. But Staff just felt that due to these changes, it was important that we bring it back to the HRA for their review and comments. Cify Council action on this item this past Monday was to agree to the pitch roof. Agree to the asphalt shingles but they did not make a motion to reduce the size of the building by the 12 feet and that they were also to keep the canopy at the present size. Clayton has advised me that he will be going back to the Planning Commission but will be taking out a building permit with those conditions and go through the process so they're not delayed in their work out there right now and hope to show the Planning Commission how it would look and I'll just leave it to Clayton now. Clayton Johnson: Thanks Todd. As we went through, by the way the good news is the construction loan has been funded and the demolition permit has been drawn and they're over there tearing it down right now or they will be starting next week. But what happened is, in the final stages of plan approval with Country Hospitality Suites, believe it or not I don't have Housing and Redevelopment Authority Meeting December 21, 1989 - Page 15 the rendering with me tonight but the rendering that you looked at and that you approved, had a mansard roof on it. Well, Country Hospitality Suites didn't look at it too closely either. They thought it was their gabled roof design. Horn: I thought it was too. Clayton Johnson: I think everybody did. But anyway, so when they came back with a list of recommendations, one of them was to go back to the gabled roof. When we initially made the, we agreed to that change and we initially went to putting cedar shakes on, one of the things that we found out in the process is just recently there's been a change in the State Fire Code. Cedar shakes are permitted. In the past you were able to put cedar shakes on and then treat them with a spray on application. That no longer is permitted. However, there still is a cedar shake, I don't want to mislead you, there still is a cedar shake that does quality for Class A. Greatly, greatled increases the cost. So we came back in the proposal that we brought basically to the Planning group was that we go with the asphalt shingle. Well I guess both Planning and Todd felt that the changes were significant enough that we should come back to this group and the City Council. Well at the Council meeting, like Todd said, the gabled roof was approved and the change to asphalt but a couple of things were not. One was taking 12 feet off the building. Country Hospitality Suites is a fairly new division of Carlson and currently they have, I don't know I can't tell you exactly how many units they have up, but they have 12~ either up or under construction. .They're learning a lot too. One of the things they're learning when they reviewed our plan is that typically there are meeting rooms contained in the lobby area and in the pool area. On our original size of that structure included room for a meeting room. Well the whole concept here is that there aren't any meeting rooms in this facility. Ail the meeting rooms and the banquet facilities are going to be provided by the theatre. So what that ended up with is the pool area was substantially larger than typically they would recommend and the reasons for that is that they don't, this is an unsupervised pool area. This is not a Holidome where you have a lifeguard on duty. It's an unsupervised pool area and their experience is that they want to keep that area as small as possible so out of that came a recoms, endation we cut 12 feet, not off the total building but only off of the portion that contains the pool and the lobby. The third change is, the other thing they wanted to do is they wanted to put their porch on. There are two things everybody's been talking about the signature of these chains and one of their signatures is the gabled roof building. The other one is the porch. Well we had a carport. Well, one of the things that happened on our carport, and it was really the lack of coordination between the architectural firm and BRW and it's our responsibility and not BRW's but when we made the decision to go and tear down the gabled roof building, one of the things that happened is now all of a sudden we have substantially more stacking for parking and thw whole parking scheme over there was redesigned. In the process of redesigning it, they moved the width of the circular drive that comes under the carport from 2~ feet to 3~ feet. The carport grew like Pinnochio's nose. Now it's 48 feet long and 36 feet wide. It's the size of a major rambler so in the redesign that we came back to the Planning group with is we wanted to shorten the carport, come to the edge of the curb and Housing and Redevelopment Authority Meeting December 21, 1989 - Page 16 canolever the carport out over the curb enough to accommodate one car. Now the total length at this point in time ends up, nobody can tell me exactly what it is so I don't want to say but it's something less than 48 feet. So those are the changes that we would like to make. I guess our feeling is that the shortening of the building is something that probably the Council can't make us, they can force us to go back to Planning Commission but they really don't have a basis of denying so I think, we haven't had a partners meeting since the Council meeting but I guess it's my feeling that probably what we would be doing is drawing the building permit with the changes that the Council approved. But since the weather isn't cooperating, we're probably going to be some time before we're into completing the footings. We will take the time 'to come back to Planning Commission and the Council when we have our homework done. We've got renderings and actually got the architect's drawings and ask for those two changes. Shortening the building up in that area by 12 feet and modifying the carport to some extent. Herb feels very strongly about maintaining the carport and maintaining the looks that the carport gave us. Both from the street and from, this intersection. Both ways but somehow we've got to avoid the 48 feet in length. It's like constructing a bridge. Horn: Don, who does have final decision on this? HRA? Council? Planning Commission? Ashworth: When we get into incentive programs with the developer, regardless of what it is, they know that they have to meet all of the City requirements for building permits and setbacks and whatever. We as'an HRA don't get involved in that at all. The only thing we're dealing with is should the particular project be allowed a special assessment write down or some other type of land write down. In this instance, the only thing the HRA is participating in are special assessment write downs. Accordingly, if they reduce let's say the size of the structure, they've already entered into an agreement setting a minimum market value for what they're going to build. My guess is that they're not going to come back and ask for that to be changed but if they would, then hypothetically the amount that we would be paying for it's specials would be reduced. The City Council has the authority to approve or deny the site plan but Clayton is really right in teems of if the land use itself is a permitted use. Whether or not an individual came in and put up a 30 unit hotel or 60 or had a pool or didn't have a pool, as long as it met all of the applicable standards and requirements in building, it would be very difficult to deny that. Horn: So really what we're looking at would be a valuation change which we don't have an estimate of at this point right? Clayton Johnson: Well the valuation change, there really isn't. The costs I guess are going to be in excess of what we hoped, the two million five. You know one of the things that didn't get brought out Monday night, I didn't make the presentation but you know, there's $3,800,000.00 invested in this project. There's $800,000.00 of the partner's equity and there's a 3 million dollar mortage in addition to the City improvements that are going to be constructed but it doesn't make any difference how much money there is. It's no different than any other economic project. There is a budget and the budget is $3,800,000.00 and so to the extent that the canopy Housing and Redevelopment Authority Meeting December 21, 1989 - Page 17 grows to 48 feet, something comes off the other end. I mean there was an attitude expressed that maybe we were you know, we're not taking money out but we are redistributing where the money goes. Horn: So the value stays the same? Clayton Johnson: The value's the same. Horn: So I guess I don't see where the HRA has an issue here. Clayton Johnson: I think one of the things everybody sensed to after what happened on housing and after what happened all the way up and down the street, I think everybody, we want to be upfront and come back and tell you what's going on and if you have feelings about it, tell us because the whole thing is not finally resolved. I mean the partners will have a meeting. They'll make a decision on what changes they're going to come back and ask for. We don't have much of, we don't have a very good hand because we've already closed on the loan and we're under construction but we do have time to come back through the'planning process and the Council and if we feel strongly about those changes, we'll probably do that. Horn: I guess my initial reaction would be that if you go to asphalt, do something like the Riveria. Clayton Johnson: It is. It's a Certainteed. And another thing happened. It went from a 12:12 pitch where the cedar shakes were very, very evident to a 6:12 pitch, 3~ feet in the air. Ashworth: The other point, and maybe this was difficult to bring up at the Council level but we've made the requirements all the way through that there be a new structure replacing the gabled roof that's being town down now and that the corridor system be established. If you take 12 feet off of that easterly side, 12 feet has to be added to this structure from the other side. Clayton Johnson: New building. Ashworth: Because otherwise you've got a 12 foot gap in there. With all the agreements, they can't have that so I don't know what is really lost. I personally like cedar shakes but I can't remember what project we went into, cedar shakes have just gone through the roof here in the last 2 to 3 years. Horn: I've had bad personal experience with cedar shakes and I got Hallmark shingles on my house right now and it's... Clayton Johnson: The steeper the pitch, you're okay but as you start to get down to a flater pitch, 6:12 and so on, in addition to the fire problems, you're also asking for trouble in regard to leaking roofs. Horn: Yes, I'm well aware of that. So I guess I don't really have too much of a problem. My preference is t6 I guess I'd have to see what the Housing and Redevelopment Authority Meeting December 21, 1989- Page 18 architectural rendering differences are before I could even comment on those. Clayton Johnson: I think you've got a rendering of the difference. Todd, didn't you? Gerhardt: These plans? Clayton Johnson: This shows you what happens with the roof. What is not there is the revised plan on the canopy which we... Horn: That's really what I'd be concerned with as far as looks. How about you Jim? Bohn: I don't have any problem with it at all. Workman: I've already stated my comments. Clayton Johnson: What are they Tom? No, I don't. You didn't get a chance the other night. Work~,an: Oh sure I did. I spoke at great length. I always do whenever I have the chance, like I'm going to do right now. Council kind of felt that the roof pitch was a good idea and that certainly with the way things were going with the Riveria, that that was certainly fine with the shingles. But we're starting to get nervous when this whole thing started to, it's starting to skinny up and Clayton used the word again tonight. The porch look rather than a canopy which is something more of a grand entrance, and I can understand where Hospitality Suites or whoever is running the show here, that's a big difference but I think Council liked that the way it was. Making more of a statement rather than just a, but I think 14 feet is what this canopy is going to go to. Just kind of sticking out with no legs under it. Clayton Johnson: 14 feet over, canolevered over the street. Half the distance of the street so like 14 feet over the street but then it's all the way back from the building. Nobody can just whether it's 3~ feet or 32, nobody knows exactly. Not 14 feet. Workman: But the 12 feet, the two sides to the 12 feet. One, the smaller pool area and that was kind of fuzzy and then it was sort of thought of, well maybe the cost and everything else. Well, whatever we decided the square footage was, it came to about $25,~.~. Well you can see where that threw the project out of whack and that it was, but again something where it's becoming less of what was imagined in rather dramatic areas and that's where Council was I believe heading. And I'll speak for myself but some of the comments that I heard about and I won't pick on the apartment building but the Council said, did we approve that? Because it maybe looked too plain or something and things were kind of cut back from there. Maybe that's the nature of all projects like this but that was kind of one of the underlying tones that here we go. We're going to skinny this thing up and what are we going to have left. Housing and Redevelopment Authority Meeting December 21, 1989 - Page 19 Horn: I think it's a concern we're all interested in. Until we really see, I'm concerned about the looks difference too. Until I see something though, I can't tell if it's going to be a real concern or if it's something that the description doesn't quite mesh right with my perception of what I hear so I really have to look at that before I gave them any judgment on it. Workman: Well there's an awful lot of imagination involved. Horn: I guess what you're hearing Clayton is we don't have any gross objections from what I'm hearing. We've got a few minor reservations and we'd like to see it a little more, if I'm interpretting it right. Clayton Johnson: Well if we go beyond the Council's direction, we'll be coming back to Planning and City Council and so we'll certainly c~,e by and keep you people posted too as it would be primarily I think, one you got just the legal issue of whether or not we can shorten our own building 12 feet because we want to. And the second is, the redesign of the canopy and when we get that redesign, I think everybody will be comfortable with it but we'll run it by you. Horn: I think we'd like to hear from staff too to comment on any perceived or real valuation differences that may occur because I think that addresses one of the concerns that Council has too about a diminished project. Workman: And HRA special assessments are involved, does the HRA have something to say about then what the finished project is? Shorter buildings, you know. If the HRA is getting involved, would the HRA accept the building half the size? Horn: But as I say, we're looking for equal valuation for what the concept was. Clayton Johnson: We've already agreed to that. We signed a contract saying... Horn: But we don't know what that means though. How can it be smaller and still be the same value. That doesn't quite compute yet but those are the kinds of issues we'd want to look at. Anything else? So we need to move on this? Gerhardt: Well I would not move on it if they're going to come back and show the canopy so I would not take any action until they come back to show you the canopy. Horn: That's what I'd prefer to do. APPROVAL OF NOVEMBER BILLS. Works, an moved, Bohn seconded to approve the HRA November bills as presented. All voted in favor and the motion carried. Housing and Redevelopment Authority Meeting December 21, 1989 - Page 2~ Workman moved, Bohn seconded to adjourn the meeting. Ail voted in favor and the motion carried. The meeting was adjourned. Submitted by Don Ashworth Executive Director Prepared by Nann Opheim