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1980 04 09 . . Chanhassen Housing and Redevelopment Authority Meeting April 9, 1981 e Chairman Gullickson called the meeting to order at 7:30 p.m. with the following members present: Commissioners Niemeyer, Whitehill, Gullickson, and Bohn. Commissioner Russell was absent. Downtown Redevelopment Project Status Report: Chairman Gullickson asked staff to present a brief status report on the developer agreement negotiations with Kraus Anderson and Bloomberg Companies, as well as an update on the Instant Web purchase agreement negotiations. Kraus Anderson Agreement: City Attorney, Craig Mertz presented a status report on the Kraus Anderson (KA) agreement, and reviewed the contract language revisions incorporated into the agreement since approved by the HRA. He explained that KA presented an executed agreement to the City Council on March 30, 1981, that satisfied all of the concerns of the Council, except one. This exception involved the deletion of proposed language that requires KA and Bloomberg to jointly maintain the courtyard. KA refused to accept their share of this responsibility, so a similar provision was also deleted from the Bloomberg agreement. Bloomberg Agreement: The City Attorney explained that is is anticipated that Bloomberg Companies (BC) will present an executed agreement to the City Council on April 13, 1981. Revisions required of the Council back in February, 1981, were reviewed and discussed. ~ A motion was made by Commissioner Whitehill and seconded by Commissioner Bohn to recommend that the City Council accept the Development Incentive clause (Section 3.7) included in the BC contract, as this language represents the incentive originally negotiated by the HRA to encourage the construction of a hotel within the project area. The HRA believes that the benefits of having a hotel in the downtown area far outweighs the maximum $273,000 financial consideration by the HRA. All voted in favor and the motion carried. Appointment of Executive Director: A motion was made by Commissioner Niemeyer and seconded by Commissioner Whitehill to approve a resolution appointing Scott Martin as Executive Director of the Chanhassen Housing and Redevelopment Authority. All voted in favor and the motion carried. Instant Web Purchase Agreement: Frank Beddor and Jules Smith of Instant Web were present for the status report on the Instant Web (IW) negotiations. Chairman Gullickson reviewed the history of the HRA's negotiations with IW, and pointed out that the HRA has always intended to work with IW towards the common goal of implementing the downtown redevelopment project, recognizing that IW is the keystone to the entire project's feasibility. He stated that there must be some way that a reasonable compromise solution can be worked out between both parties. Condemnation of IW's property would not solve the problem, since contractual commitments with KA require that the IW property be delivered to them by November 30, 1982, and financial feasibility for the IW AGquisition e ~ e Minutes - April 9, 1981 Page 2 Chanhassen Housing and Redevelopment Authority Meeting is ~ased on IW's relocation back into the tax increment district (i.e. Bus~ness Park). Commissioner Whitehill explained that the current issue of charging IW rent while constructing their new building had been negotiated by the HRA over the past few years. The HRA agreed to allow IWto continue to occupy their existing building rent free, since IW had agreed to other c9nc~ssions during negotiations; specifically, to build their new facility w~th~ the tax increment financing district, and to waive any other develop- ment incentives potentially available to others in the Business Park in the future. I . I A motion was made by Commissioner Whitehill and seconded by Commissioner Bohn to strongly recommend that the City Council settle the IW purchase agreement impasse by allowing IW to occupy the existing building following acquisition b~, the City without any requirement for rent, as previously negotiated by the HRA. Occupancy of said building shall terminate no later than that date required by the City to deliver title to the IW property to KA. If, due to circumstances beyond their control, IW should continue to occupy the building beyond said date, then rent shall be paidtQ the City for use of the building and premises. Also, IW must waive any business incentive program which they might otherwise be entitled to for development in the Business Park, as a condition for rent free use of the building. Councilman Clark Horn expressed concerns that a precedent for free use of city acquired property would be established if IW was given this type of consideration. e Commissioner Whitehill explained that this represented a negotiated position that applied only to IW, since they had conceded other things during negotiations. All voted in favor and the motion carried. Commissioner Whitehill asked Beddor if any other issues were still remaining with their agreement. Beddor said that an agreement for the City to provide necessary public improvements in Park One was still unresolved. He agreed to accept a 20% assessment on Park One improvements, which represented a compromise position from that presented to the City at the March 30, 1981, City Council meeting, if the Council accepts the HRA's recommendation for rent free use of the existing IW building. Don Ashworth, City Manager, reviewed the City Council's action in adopting the plan for a Park One Tax Increment and Economic Development District. Commissioner Gullickson moved that the HRA recommend acceptance of IW's Park One Assessment proposal of 20%, since the development of this property is consistent with the overall redevelopment project. The motion failed due to the lack of a second. Commissioner Whitehill felt that the Park One issue as far as establishing city assessment policy is concerned is beyond the jurisdiction of the HRA. e Commissioner Whitehill moved and Commissioner Niemeyer seconded a motion to clarify the HRA's position relative to the IW Agreement. The waiver Minutes Chanhassen Housing and Redevelopment Authority Meeting April 9, 19B1 Page 3 of rent for IW is not precedent-setting for other properties to be acquired by the HRA, since the IW settlement involved considerations for all relocation benefits to be paid IW. All voted in favor and the motion carried. e Overlay District Report: Scott Martin explained that staff has been working with BRW on the Overlay district report for the past six weeks, and that authorization to exceed the previous consultant budget of $4,000 was necessary to complete this project. A motion was made by Commissioner Whitehill and seconded by Commissioner Niemeyer, to authorize an additional $3,200 expenditure for completion of the Overlay District report, with the condition that the City reimburse the HRA for 50% of the cost of report preparation should the report be adopted as a comprehensive revision to the City Zoning Ordinance. All voted in favor and the motion carried. Adjournment: The meeting was adjourned at 9:10 p.m. Scott A. Martin Executive Director e e ( \ ( RESIGNATION -- OF EXECUTIVE DIRECTOR .~.. I hereby resign my appointment as executive director _. of the Chanhassen Houi:ring- and Redevelopment Authority effective immediately upon the appointment of my successor to that position. Dated: April 9, 1981 i1JU Donald W. Ashworth tu ~ -- e