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HRA 1986 02 06AGENDA CHANHASSEN HOUSING AND REDEVELOPMENT AUTHORITY THURSDAY, FEBRUARY 6, 1986 CITY COUNCIL CHAMBERS 1. Call To Order. 2. Approval Of Minutes: a. November 7, 1985 b. December 19, 1985 3. Special Assessment Reduction Requests: a. Opus Corporation b. Sunnybrook Development 4. CHADDA Update - Brad Johnson and Larry Smith 5. Broadened Study Area Update - Fred Hoisington 6. Old Business. 7. New Business. 8. Approval of Bills. 9. Adjournment. HOUSING AND REDEVELOPMENT AUTHORITY MINUTES REGULAR MEETING NOVEMBER 7, 1985 CALL TO ORDER Chairman Whitehill called the meeting to order at 7:40 p.m. Present were Chairman Whitehill, Commissioners Swenson, Horn, Bohn, Robbins. Staff present were Don Ashworth, City Manager, Barbara Dacy, City Planner and Fred Hoisington. APPROVAL OF MINUTES Motion by Swenson, seconded by Horn, to approve the minutes dated October 17, 1985 as written. All voted in favor and the motion carried. EVALUATION OF BOWLING CENTER CONSTRUCTION, AUTHORIZE ISSUANCE OF CHECK PER LOAN AGREEMENT Ashworth stated that Dorek and Baden have requested the HRA issue the $200,000.00 loan in accordance with the loan agreement entered into between the HRA and Dorek and Baden at time of purchase of the old Instant Web building. He stated that because of their requests, the item was scheduled before the Council at their November 4, 1985 meeting to determine compliance with the subdivision /conditional use permit requirements and is now before the HRA to determine compliance with facia /site plan requirements before payment is authorized. Ashworth stated that the City Council moved that the staff and bowling center owners come to a compromise as to what would be a reasonable amount to withhold from the $200,000.00 for HRA consideration on Thursday night. Ashworth stated in preparation of the review by both Council and BRA, he asked Hoisington to evaluate the building plans with the previously approved plans and to evaluate what is existing on site. He stated that Hoisington has prepared a twelve item memorandum dated November 1, 1985. Jack Henning, representing the bowling center owners and the general contractor for the project, presented their concerns with the twelve items contained in Hoisington's memo. Hoisington stated that he had prepared cost estimates in order to accomplish each of the items in his memo. He stated that the erosion control amount could be reduced to account for seeding appropriate areas and installation of hay bales. Horn asked the Mr. Henning if the $28,590.00 cost estimate was reasonable. Henning replied that he felt it was high. HRA Minutes November 7, 1985 Page 2 Whitehill felt that the HRA could issue $180,000.00 and retain $20,000.00 to cover any remaining items that needed to be addressed by the applicants. He stated that the HRA cannot exempt the authority of the Planning Commission or City Council to waive any of the requirements issued through the conditional use permit and site plan review so he stated that the applicants would have to seek relief from those bodies. Whitehill moved, seconded by Horn, to release $180,000.00 to Dorek and Baden but to retain $20,000.00 where 808 of such is released as each item is completed and when the last item is completed, the remaining amount shall be issued to the appli- cants. The items referred to are contained in Fred Hoisington's memorandum dated November 1, 1985 and the applicants are advised that any amendments to these items must be approved by the Planning Commission and City Council. All voted in favor and the motion carried. REVIEW CONTRACT ADDENDUM OF BROADENED STUDY AREA Motion by Horn, seconded by Bohn, to expand the broadened study area to include the T.H. 212 corridor. All voted in favor and the motion carried. LAND AREA IN THE NORTHWEST CORNER OF T.H. 101 AND T.H. 5 Ashworth stated that the owner of the Prairie House Restaurant has contacted him in regards to the city's willingness to purchase the area of land in between the Holiday Station and the Prairie House Restaurant. Ashworth presented the HRA with copies of the proposed land configuration. Ashworth stated that the land area because of its configuration and location could not be used for any public purpose. Because there were no other addi- tional details available on the item, Whitehill moved, seconded by Horn, to table the item when more details become available. All voted in favor and the motion carried. APPROVAL OF BILLS Motion by Whitehill, seconded by Robbins, to approve the bills dated October 21, 1985. All voted in favor and the motion carried. Motion by Horn, seconded by Robbins, to adjourn the meeting at 9:25 p.m. HOUSING AND REDEVELOPMENT AUTHORITY MINUTES DECEMBER 19, 1985 CALL TO ORDER Chairman Whitehill called the meeting to order at 7:50 p.m. Present were Commissioners Horn, Swenson, and Chairman Whitehill. Absent were Commissioners Bohn and Robbins. Staff present were f Fred Hoisington, Don Ashworth, City Manager and Barbara Dacy, City Planner. BROADENED STUDY AREA UPDATE Hoisington presented two alternative land use and street plans for HRA consideration so that one land use concept is chosen to serve as the basis for the traffic analysis of the broadened study area. Hoisington explained that he presented the two con- cept plans before the Planning Commission on December 18, 1985. He stated that the Planning Commission recommended Plan A. Hoisington stated that Plan A is basically in accordance with the City's adopted Comprehensive Plan. He stated that it included the connection of T.H. 101 to T.H. 5 at Dakota Avenue as well as including interchanges with T.H. 212 at County Road 17 and Dell Road. He stated that a partial intersection right -in /right -out could be tested between Great Plains Boulevard and the railroad bridge. He stated that Plan B includes an interchange at Highways 212 and 101 and only a minor departure in land use from Plan A. He stated that it includes additional commercial development in the southwest quadrant of Highways 5 and 101 plus some higher intensity development in the vicinity of 212/101 interchange. He noted that Plan B does not propose a connection of Highway 101 and 5 at Dakota Avenue which routes 101 traffic through the downtown area. Hoisington stated that it was brought up at the Planning Commission meeting that an intersection on County Road 18 with T.H. 212 should be considered. The Commissioners discussed each of the plans and felt that Plan A should be used by the consultant to use as the basis for traf- fic analysis. CHADDA PRESENTATION AND UPDATE Brad Johnson distributed the December report regarding: 1. A summary of the market analysis. 2. Preliminary phasing and timetable for development. 3. Activities for participants for the next 45 days. Johnson stated that the marketing studies revealed that: 1. There is a market in the downtown vicinity for an additional 80 units of market rate housing. 2. There is a market in the downtown vicinity for a full service upgraded grocery store of approximately 20,000 square feet I HRA Minutes December 19, 1985 Page 2 plus a hardware store, drug store and other convenience stores for an additional 20,000 square feet. He stated that there is also a local demand for an additional 10,000 to 20,000 square feet of specialty retail stores that could be included in a convenience center if a "specialty center" is not developed as part of the plan. 3. The market study revealed that there is a need at this time for an 80 -100 unit full service hotel in the community. Ideally location would be near the dinner theater but with visibility from Highway 5. The study revealed that 50% of the occupancy would come from the tourists to the area with the balance from local business related stays. 4. The market study reported a potential for a 20,000 to 60,000 square feet of specialty shops and restaurants. Twenty to thirty percent of the proposed space would be occupied by restaurants. The market study stated that development of such facility would take two to three years, including design, tenant selection and construction. He stated that it would be very important that 75% of a retail specialty center be occupied the day the center opens because synergism creates the sales and traffic. Johnson stated that CHADDA could establish the following as goals: 1. Construction of 40 to 60 units on Chan View and the dry cleaning site for occupancy in April, 1987. 2. Construction of a 40,000 square foot specialty retail space north of West 78th Street with occupancy in the spring of 1987. 3. The need should be determined to have a specialty center in place prior to opening a hotel. 4. If the specialty center project is pursued, another six months of market studies and design would be necessary to determine true feasibility and determine the amount of square footage that could be consumed. Johnson noted that the tax increment law changes may have a significant impact on construction dates. Johnson reviewed activities for CHADDA and the HRA in the city within the next 45 days. CHADDA's activities would include: 1. Establish land control for housing site. 2. Negotiate contract with Retail Real Estate Concepts for specialty retail center design. 3. Meet with existing businesses. HRA Minutes December 19, 1985 Page 3 4. Study various methods of finance. 5. Prepare preliminary feasibility package for HRA and potential equity partners. 6. Identify parcels of land needed to implement program. 7. Begin planning a potential relocation program for existing businesses in conjunction with the city. 8. Begin discussion with varius grocery store operators. 9. Determine feasibility of realignment of Highway 101. Johnson suggested that the HRA /city pursue the following: 1. Start to formulate potential land acquisition and relocation policy for affected businesses and owners. 2. Determine posture related to tax increment financing, HRB and IRB assistance to the project. 3. Determine potential for participation in the development of community center. 4. Timetable, costs and financing of the infrastructure to sup- port the various phases of the developments. 5. Report existing or planned developments within the community in conflict with the proposal. OLD BUSINESS Ashworth explained to the HRA that costs have had to be incurred for conversion of the old Instant Web building into the bowling center. Ashoworth stated that he had a meeting with JLH Associates the next day and would be reviewing the amount of bills that have been charged to the HRA. He stated that some of these bills should be paid by Halverson as some of the reconstruction involved his portion of the building. He stated approximately $8,000 to $10,000 had been charged. APPROVAL OF BILLS Motion by Swenson, seconded by Horn, to approve the bills dated November 18, 1985. All voted in favor and the motion carried. Motion by Whitehill, seconded by Horn, to approve the bills dated L December 16, 1985. Whitehill and Horn voted in favor and the motion carried. Swenson abstained. L Motion by Swenson, seconded by Horn, to adjourn the meeting at 9:30 p.m. I CITY OF So,, CHANHASSEN 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 (612) 937 -1900 MEMORANDUM TO: Housing and Redevelopment Authority FROM: Don Ashworth, Executive Director DATE: January 23, 1986 SUBJ: Special Assessment Reduction Agreement, Chanhassen Lakes Business Park, Opus Corporation In April, 1985, Opus Corporation approached both the Chanhassen City Council and the Housing and Redevelopment Authority regarding problems they were having in completing development in the first phase of the business park. Specifically, approxi- mately ten lots within the existing business park have severe soil conditions limiting or negating the ability of these lots to be sold /developed as originally proposed. The question posed to the City Council was whether the City would initiate a public improvement feasibility study to determine whether a recon- figuration of roads /utilities could make these parcels more usable, including the costs of such. The Housing and Redevelopment Authority was asked whether these improvement costs could be included within the Special Assessment Reduction Program and whether the formula could be modified recognizing that the total assessments for the new and old improvements could be in excess of $40,000 per acre (such being in comparison to the existing $20,000 per acre for improvements currently included under the Special Assessment Reduction Program). The BRA tabled action to review costs from the feasibility study if authorized by the City Council. The Chanhassen City Council acted to approve preparation of a public improvement feasibility study. The study was completed in January, 1986 and submitted to the City Council on January 13th (copy attached). The Council acted to accept the study and order preparation of plans and specifications. The total project costs are anticipated to be $449,850. This compares to the current special assessment balance, against this same group of lots, in the total amount of $484,170. Also acted upon by the Council was the Planning Commission recommendation that the lots be recon- figured to represent the new five buildable lots versus the pre- vious ten. Housing and Redevelopment Authority January 24, 1986 Page 2 Given Planning Commission /City Council action, the issue of whether the special assessment program should include the recon- figured lot costs is re- presented for BRA consideration. The request from Opus Corporation is economically justifiable for both the City and Opus Corporation. It does not benefit either the City or Opus Corporation to carry an existing $484,170 in assessments against parcels which cannot be developed in their current configuration. Similarly, being able to recoop the pre- vious assessment amounts plus new assessments of approximately $400,000 establishes overall land values which cannot be sup- ported in the open market. Modification of the existing incen- tive formula, from 78 of the construction value to 128 of the construction value, will establish equal treatment of these lots with other lots in the business park, i.e. if Opus Corporation maximizes the development potential of each of the new lots, Opus should be able to achieve a similar net cost to the buyer as exists for any other lot. Similarly, by modifying the existing formula to 128, the City and Opus will maintain a competitive edge for these properties in comparison to property values /sales in adjacent communities. In making the above recommendation to add into the existing for- mula a 128 bracket, it must be remembered that the higher BRA participation level would only apply for parcels whose total assessment exceeded $30,000 per acre. The 78 bracket would con- tinue to exist for old properties having total assessments of zero to $30,000 per acre. Again, by establishing the two tier formula, the HRA reasonably assures itself of establishing a for- mula which will treat two lots with different assessment levels equally. From a developer's standpoint, there would be no incen- tive in him seeking a higher participation level from the City if he recognized that such higher participation level would only be given where higher than normal assessments existed, i.e. he would have no economic advantage in seeking the higher percentage ver- sus the lower. This item was briefly discussed by the HRA approximately two months ,ago when originally presented by Opus Corporation. At that time, the BRA requested that two additional pieces of infor- mation be provided: 1) the period of time required to pay off the the higher incentive level, and 2) both the short and long term economic impact of the proposal. The development incentive program, established by the HRA for the business park, has been our most successful program. Excluding the ten lots proposed to be reconfigured, only two lots of the original 35 lots in the business park remain undeveloped or unsold. The original prediction that it would take approximately 11 years to repay the 78 reduction incentive has proven to be correct. Based on the lot reconfiguration /buildable areas, it is Housing and Redevelopment Authority January 24, 1986 r Page 3 reasonable to assume that by moving to the 128 incentive level that an approximate 21 year payoff would be required.- In terms of short term impact, it must be remembered that the incentive program does not become effective until the proposed development is totally complete. Additionally, the existing assessment structure is based on a 15 year payoff ending in 1995. By enticing the development to occur early, bonding can be repaid earlier. As no more than one year of potential payment exists prior to first collection of property taxes, the existing reserve being built up within the HRA fund can reasonably pay the 1 /15th principal amount due in the first year with the collections during the next 21 years then paying the previous year and remaining balances. The long term economic impact also favors any form of policy which would induce development to occur as soon as possible while simultaneously insuring that existing assessments are not jeopardized. Based on the above analysis, this office would recommend that the Housing and Redevelopment Authority conceptually approve Opus' request to modify the existing special assessment reduction for- mula from 78 to 128. Such conceptual approval would be con- tingent upon the City Attorney obtaining approval from the City's bond counsel of this modification, drafting the specific language which would incorporate the two tier system into the formula, and resubmitting such to the Housing and Redevelopment Authority for final action. Cam,. of I' ,I I w Va \ r,�� \ �\ 40 44 kk V_ tLd I I _V_ Ilk, lob 00 Ot � j , LU LOT BLOC( SPECIAL EXISTING ASSESSMENT NEW NEW ACRES_ BALANCE LOT BLOCK NEW ACRES NETT SPECIAL ESTIMATEO ASSESSMENT BUILDING BALANCE VALUE B $30 - 8 7% REMAINING BALANCE 0 10% REKAINING BALANCE B 11% SPECIAL ASSESSMENT REDUCTION REMAINING REMAINING BALANCE" 0 12% BALANCE 8 13% REMAINING BALANCE B 14% REMAINING BALANCE 2 1 2.0766 33,422.45 ` 3 1 2.5245 40,631.27 - 4 1 5 1 2.9181 2.4184 46,966.17 38,923.64 1 2 1 1 1.8977 1.6603 61,3449.07 53,665.62 330,000 406,500 23,100 38,239 33,000 28,339 36,300 25,639 39,600 21,739 42,900 18,439 46,200 15,139 6 1 2.1698 34,922.44 3 1 3.9534 127,785.15 1, 050, ON 26,455 73,506 25,211 54,285 40,650 105,000 13,016 22,785 44,715 115,500 8,951 12,285 48,780 125,000 4,886 - 1,785 52,845 821 56,910 (3,244) 7 l 3.0257 48,701.21 136,500 (8,715) 147, ON 119,2151 B 1 9 1! 4.2373 5.4524 68,198.43 87,755.19 4 5 1 1 6.3255 4.6453 204,458.18 150,149.33 1,500,000 870, ON 105, ON 99,458 150, ON 54,458 165, ON 39,458 IN, NO 24,458 195, ON 9,458 210, NO 15,542) 10 _ 1 5.2594 84,648.90 6 1 7.8174 226,822.35 _ 1, 800, NO 60,900 126,000 89,249 100,822 87,000 180, ON 63,149 46,822 95,700 198, NO 54,449 28,822 104,400" 216,000 45,749 113,100 37,049 121,800 28,349 10,822 234,008 (7,178) 252,000 (25,178) SUBTOTAL 30.06 484,169.70 25.50 824,219.70 5,956,500 PER GILD ACRE 16,095 - PER NEW ACRE 18,987 EST IMPROVEMENT COSTS 340,050.00 EST TOTAL ASSESMTS 824,219.70 PER NEW ACRE 32,323 .. _ _. .. _...__.... ._ . _... - SPECIAL ASSESSMENT REDUCTION SPECIAL - - NEW SPECIAL ESTIMATED EXISTING ASSESSMENT NEW NEW NEW ASSESSMENT BUILDING REK41NINB REMAINING REMAINING REMAINING REMAINING REMAINING LOT BLOCK ACRES '2 BALANCE LOT BLOCK ACRES BALANCE VALUE B 435 8 7% BALANCE 8 10% BALANCE 8 11% BALANCE B 12% BALANCE B 13% BALANCE P 14% BN.ANCE 1 2.0766 33,422.45 - - - - -__ 3 1 2.5245 40,631.27 ..'... _... - __. 4 1 2.9181 46,966.17 1 1 1.8977 61,339.07 385,800 26,958 34,389 38,508 22,839 42,350 18,989 46,200 15,139 50,858 11,289 53,900 7,439 5 1 2.4164 38,923.64 2 1 1.6603 53,665.62 ' 474,250 33,190 20,468 47,425 6,241 52,168 1,498 56,910 13,244) 61,653 (7,987) 66,395 (12,729) 6 1 2.1698 34,922.44 3 1 3.9534 127,785.15 1,225,000 85,750 42,035 122,500 - 5,285 134,750 (6,965) 147,000 (19,215) 159,250 (31,465) 171,500 (43,715) 7 1 10257 48,701.21 B 1 4.2373 68,198.43 4 1 6.3255 204,458.18 1,750,000 122,506 81,958 175,000 29,458 192,500 11,958 210,000 (5,542) 227,500 0,0421 245,000 (40,542) 9 1 , 5.4524 87,755.19 5 1 4.6453 150,149.33 1,015,000 71,056 79,099 101,500 48,649 111,650 38,499 121,800 28,349 131,950 18,199 142,100 8,049 18 1 5.2594 84,646.90 6 1 7.0174 226,822.35 2,108,000 147,008 79,822 210,000 16,822 231,000 (4,178) 252,800 (25,178) 273,008 (46,178) 294,000 167,178) SUBTOTAL 30.08 484,169.70 25.50" 624,219.70 6,949,250 " PER OLD ACRE 16,095 ti PER NEW ACRE 18,987 EST IMPROVEMENT COSTS 340,050.00 " EST TOTAL ASSESSMENTS 824,219.70 PER NEW ACRE 32,323 - - - ' Council Meeting, Apri L.._5, 1985 -13- 'SPECIAL ASSESSMENT REDUCTION AGREEMENT, CHAN HASS EN LAKES BUSINESS PARK, OP15� CORPORATION: Don Ashworth: Opus has found that there is a problem with the soils in the business park area and they have lost a couple of businesses as a result of that. Opus would like to address that problem. One way to do that is through a replatting and construction for the additional cul -de -sac street. Assessments right now are in excess of $20,000 per acre in that section, The construction of additional streets would increase those figures dramatically, 'The question becomes one of is there a mechanism under . which the HRA, where you do have a cost that has substantially increased over what had been anticipated be considered under the program that they have. This is basically a question that should be brought back to the HRA. It is in their area of responsibility, but I was sure that the City Council would want to be aware of the issue. Being aware that this would be presenting a question to the HRA and to discuss whether or not the public included should be considered to correct that problem. Bill Monk will briefly outline the scope of the improvements and how that could correct some of the soil problems in that area. dBill Monk: Most of the dead soils as they exist on the property are to the imme- iate east of the cul -de -sac. The cul -de -sac does go through some of the bad soils itself. The intent is to put the buildings over towards Audobon Road where it starts to slope upward. The areas of better soil types would require the installtion of the street and utilities to service the new lot configuration. We could be looking at costs of between $150,000 and $250,000. With lots platted as they are now, it would be very difficult to develop because of the extreme amount of fill that has been put over the poor soil. Councilman Gevino: How did you come up with the figures of $150,000 to $250,000. Would this mean the extension of sewer and water up in the cul -de -sac? Bill Monk: Some sewer would have to be extended up, but it would not necessarily be in the cul -de -sac. Most of the improvements would be to the existing lines that already surround the site. That would probably minimize the utility installation. Most of the cost is actually the dirt work and street construction. Councilman Gevino: I noticed on the original configuration of lots 7, 8, 9 and 10 facing Audobon Road, I have always assumed that those would be lots that the buildings would be facing Audobon and now with this configuration as proposed they would all be coming off of the cul -de -sac. That made more sense. The Audobons con- figuration made some sense because the topography isn't all that bad along there. Bill Monk: When you move up into lots 8, 9, and 10 there is a considerable slope on the west side of the lots. Lot 7 and 11 are much more readily serviced. Councilman Geving: I think lots 7 and 11 would be buildable and possibly lot B. Bill Monk: Opus has had a tremendous amount of research done, including soil tests and all kinds of data to show why the cul -de -sac arrangement was better. The staff has questioned the buildings A through E as shown on the second map, which would be a better layout. We are just trying to .work with them to whichever way they think is best. There last option, I believe, was to put in no improvements. L J Counilman Gevino: Don't you think, Mr. Monk, that you could get a tjf area to the east of the cul -de -sac. lot out of the �- Bill Monk: The soil is too deeply damaged. L Council Meeting, April 15,1C 35 \ -14- Councilman Gevina: So, essentially, you would be taking ten lots and creating five. Bill Monk: You would be taking lots 2 through 10 and consolidating them. So you would be taking nine lots and turning them into 5. Councilman Horn: Which lots would not be accessible or usable by the current configuration? Bill Monk: The reason that they are proposing the cul -de -sac is because of the extreme poor soils on the east side together with slope problems for lots 8, 9 and 10 on the west side just gaining access to Audobon. With a conbination with those two, they feel that the best in line would be this cul -de -sac. Again that reseach and data collection was done by the Opus Corporation. This is their guess as to making as much of the area marketable as possible. Councilman Horn: Who reviewed the research on the original layout? Bill Monk: The City reviewed the layout as best as it could. lots, I think 7, 8, 9 and 10. There might be a frontage road, taken to a conclusion. As far as the soil types, I think that occurs during the construction phase when the city and contrac tions on what to do with excess fill that was put in there and perly, but it was the developers request. There was torn -up but that was never is something that tar was given instruc- it was not done pro- Bob Williams, Opus Corporation: I have a couple of points that I would like to help with. We didn't discover the problem until after we had assumed ownership of the property. We had been under the assumption that the reduction program that the City had in place at the time was going to be more than adequate to help make the property competative. We had several potential users look at the sites in this area and after analyzing it we found that we had some soil conditions and we began to wonder how deep and how far the soil problem was. We then put a temporary moratorium on the marketing and looked into the problem deeper and what resulted is what you see now, that being, we have poor soil and poor slopes. The only way that we can substantially take care of the problem is to use the configuration which you have seen this evening. If you put a pencil to it you will see that the assessments have increased dramatically. With the dramatic increase of cost, the question is how can we con- tinue to make these lots competative? We have a $30,000 per acre charge which will now be assigned to the configured lots. The only reason I am here this evening is to ask you to consider the concept which will allow us to respread the assessments and increase the amount of the percentage that are from the assessments that are already in this area. Councilwoman Watson: When I first read this, my first thought was - This is not the City's problem. In talking with Mr. Ashworth about it, my only concern was that we not give any future property owners of the business park an advantage that was not given to someone that came in earlier. Mr. Ashworth stated that these special assessments on these lots were at $20,000 per acre before so that they would have bene- fited in something that we had now, but didn't because it didn't exist then. So if you go to the 10 percent now on the $30,000 over, we wouldn't have over looked anyone with that benefit in the past had we had it in effect. When I heard that, then I wasn't as uncomfortable with changing that policy as long as no one would have bene- fited from it because it wasn't in effect then. So I guess I am fairly comfortable with ten percent. Council Meeting, April 5, 1985 C -15- Councilman Cevino: In knowing those lots .fairly well and picturing them in my mind, I think we would be fortunate if we could build five buildable sites on those nine j lots right now. It makes a lot of sense to me for this marketing strategy to combine and reorganize the lots. I am very much in favor of it. I think it is the only way that we are going to market the rest of the area. We accepted this lot configuration thinking we could sell those lots. If the developer now tells us that it is going to sit there for a long time, we are not going to make any money on that either. I r would rather work with the developer, even if it is going to cast $150,000 to $250,000 to reconstruct the area. Councilwoman Swenson: When these bond payments are being made, is the City footing the bill? Don Ashworth: No. Opus is making these payments. Councilwoman Swenson: So there are tax payments being made. If we reduce this assessment by 10 percent, then the reclamation will be after they have been sold or built? Don Ashworth: The way the formula works is to the developers advantage*to get the development in as soon as he can because each time an assessment is paid, it reduces the amount that he can basically take advantage of. I believe Opus has tried to actively market this area. Councilwoman Swenson: I wanted to determine whether it would be activated prior to the contruction. Councilman Horn: I can see where an access problem exists on lots 8, 9 and 10. I am not quite clear on what the problem is on the other lots. What does the low soil have to do with the access on the other lots? Barb Dacy: The access issue was just another benefit of the replatting. The replatting takes advantage better of the usable areas of the 7 or 8 lots and it adds the benefit of consolidating access onto a minor instead of interrupting a collector five times. Councilman Horn: I have a problem with keeping ourselves competative with other areas. My only concern is that we may have some private covenants that keep us less competative than other areas too, which the City has no control over. I would not hesitate to go along with this assuming that our restrictive covenants do not drive companies to other areas. fMayor Hamilton: We specifically had a problem with this when Opus would not allow additional silo structures to be built, and that is when they moved to Waconia. That is one of those things that we have talked about a long time ago and we didn't want to lose complete control over the companies that are in this area and our abi- lity to work with them and to keep them in the community. We seem to have lost total control with that particular situation. We would like to know if there are any irestrictive covenants that we may not be aware of that would hinder some company that r may move into this area now after the City has approved this and put in the improve- ments and then a company comes back and wants to put on an addition or a silo or wha- tever and Opus says no. lJ Bob Williams: We hear and understand your concern, but I assure you that we are not going to artifically create any situation in the park that will discourage any com- pony, We are mindful of the City's interest in having quality development, which not Council Meeting, April 15, C.5 C -16- only has good business but also has a good business appeal in the park, You don-t want us to put those types of uses in the park that will discourage the locating in other parts of the park. There is balance that we all have to try and achieve here Councilman Geving: If this area is to be funded and resubdivided, do you have some potential sales for any of this land? Bob Williams: At this point in time we have a lot of interest. We have had more interest generated in the park than from the time that we built the park. I believe that is a reflection on where we are at in our economy and the fact that Chanhassen is now looked upon from a lot of businesses that this is where they want to conduct their affairs. So on that regard, we do not have any commitments, but we do have a lot of interest and we are feeling pretty comfortable that we can come up with a policy that has -a reasonable reduction. We are not saying that we want that fixed on $30,000. We would have to come back once we have zeroed in on the final figures, because what we are dealing with now are estimates. Mayor Hamilton: We do not need a motion on this item. I think you have heard, Mr. Williams, that we are well in favor of it. 1986 LAWCON GRANT APPLICATIONS: Don Ashworth: The Park and Recreation Commission has made a priority or at least what they would like to go ahead with for applications for this year. The Council should be aware that if you want other applications to be considered you should take this point in time to specify them. They are basically the same three that you have looked at before. The ballfields, access road and parking on Tract E are associated with the expansion of Lake Ann, the shelter building at Lake Ann and the third one softball field lighting at Lake Ann. Mayor Hamilton: I would like to see the old City Hall moved to the park for a shelter or something else at the .park without destroying it. Councilman Geving: I would like to see it moved only if it can be safeguarded and utilized and not accessible for someone to tear it apart. Councilwoman Watson: And utilized with dignity. Councilwoman Swenson: We own the lot south of the lot that the building is currently sitting on. It is under the Historical Society and we should check to see if there is any possible funds available from them for this. Let's give that parking lot back to Mr. Pauly and put it on our own land and see if we can get some money from the Historical Society to fix it up. We keep talking about the entry way into the City. What a better place for that building. It is a part of Chanhassen's history and it should be restored. Councilman Horn: I agree with the grant applications, but my concern is with the City Hall in that it sits quite appropriately next to old St. Hubert's Church. I would like to see those two stay together. . PROPOSAL FOR IMPROVEMENTS TO CREEKWOOD DRIVE: I Bill Monk: Back last fall, the City Council discussed the Creekwood Drive pavement, Two items were actually discussed. One of them was the possibility of moving access to the golf course so that it would come out on County Road 14. After talking with r 4n4. � c CHANHASSEN HOUSING & REDEVELOPMENT AUTHORITY 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 (612) 937 -1900 MEMORANDUM TO: Housing and Redevelopment Authority FROM: Don Ashworth, Excecutive Director DATE: April 15, 1985 SUBJ: Special Assessment Reduction Agreement, Chanhassen Lakes Business Park, Opus Corporation Opus Corporation finds that the lots in the northwest section of the business park cannot be used as originally thought because of soil conditions. The best solution to maximize usage of lots having good soils will require replatting and a new cul -de -sac street /utility improvements (see attached memorandum from the City Planner). Opus is basically asking two questions: 1). Chanhassen City Council: Will the City Council consider a resubdivision of the poor soiled lots and authorize the new road /utility improvements as a public improvement project to be assessed back to those benefitted lots ?; and 2). HRA: Will the Housing and Redevelopment Authority reconsider its special assessment reduction program recognizing that the lots being corrected will have spe- cial assessments much higher than typically found in surrounding communities and other lots in the business park? The latter question posed by Opus is a difficult one. The BRA operating budget has been strapped for the past two years and is just now starting to show strength. I am anticipating a reluc- tance to place additional committments against current resources until such time as additional strength has been achieved. On the other side of the coin is the reality that the program was ini- tially established to provide a competive edge for Chanhassen in attracting new businesses into our community. The program has worked successfully and was probably the most influencing factor in Fluoroware, Empak, DayCo, etc. construction decisions. It should be noted that the recently approved Redmond Products site Housing and Redevelopment Authority April 15, 1985 Page 2 plan was originally intended for Lot 1, Block 4 of the Business Park. Due to soil constraints, location of the Redmond facility were not feasible. It was fortunate that the alternative site on ` the north side of Highway 5 next to Lyman Lumber was found.) The typical payback period for businesses receiving special assessment incentives has been approximately 11 years, i.e. it takes approximately 1} years for the average business taxes in the business park to repay the special assessments that were taken over by the BRA. To change from an incentive of 78 of the market value to 108 - 128, would increase the payback period to between two and three years. To insure that the percent of reduction did not provide a precedent for other lots or other future decisions, staff would recommend that a two tier schedule be established wherein the percent would remain at the 7% level if total assessments for a property were less than $30,000 per acre and would be 10% to 12% if the assessments exceeded $30,000 per acre. No action is proposed on either items 1 or 2, above. The item is being presented solely for discussion with the developers then being notified as to City Council and HRA thoughts. C CITY' OF CHANHASSEN 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 .. (612) 937 -1900 MEMORANDUM TO: Mayor and City Council FROM: Barbara Dacy, City Planner DATE: April 12, 1985 SUBJ: Proposed Replat of Lots, Chanhassen Lakes Business Park Attached is the plat of Chanhassen Lakes Business Park indicating the areas to be replatted or lots consolidated. Opus has deter- mined that very poor soil and slope conditions are hampering the marketability of these lots. L -ts 1 and 2, Block 4 are intended to be consolidated and sold as one lot. Lots 4 and 5, Block 2 are intended to be replatted by shifting the existing north -south lot line to an east -west divi- sion. Lots 2 -10, Block 1 are intended to be replatted by the creation of a cul -de -sac into the interior of these lots. Opus has made application on the replat of Lots 4 and 5, Blcok 2 and it is scheduled for Planning Commission review on April 24, 1985 and Council review on May 6, 1985. Planning staff's initial review of this request is favorable and we would be recommending approval (subject to any necessary conditions). Proposed for Lots 2 -10, Block 1 is the creation of a cul -de -sac and the reorientation of lots toward that street (Lots 2 and 3 con- tain the poorest soil conditions) . By replatting, lot dimensions can be adjusted to work around the soil limitations. Creation of the cul -de -sac will also reorient access from four existing lots onto Audobon Road (a collector) toward the cul -de -sac (a minor street). Upon submission of preliminary plat details, staff can be more analytical; however, the proposed concept in this part of the park appears to be a good solution to the problem. I Attachments F 1. Opus replat areas 2. Letter from Michelle Foster, 3. Proposed Replat of Lots 2 -10, Opus Corp., dated March 18, 1985. Block 1 NNao-n.. °iM!$ °( See N 9fy ^9Y ° /wey Lre o/ 5,6fe Nr�Swoy M lore d NY, °i S.e. µ AJ °� of ((Lb-eer LbuV nbrwrz+Vi 467 Os desc r(r,d rn Ebh'[', }by /. ,+w5 1; _(d °(,ryW y5k rs, TneMrPasV /sy a! Mrs<elrenea„e � t ° �.9!' Y \ S- - i m Af a p 3+ W,my H sl A e� ? Fy PARK r sa rl , •d•.11 B mua xg' Fg V . - ��r° i r .a8 VI ,vllrly cmea.ri OV �/eeror °�ar f 9y.,�� 8 -. fy ufor mi s a '(LV" IaNVV / °i. C/„�114° y':�, B40, x la,,,yt A t ,.✓ "^ ,�; iq dr, i a ° °' i 1°• 3 ¢ A °�.Nd> ] 8G NIrM 01$4$O/HE %.O a^ ,mow a � ,r•°°O° � ELF "�` 'q 3 � r' a ap•P J <�' a� ___- .. Al • x %qm a °e .1� -S�d < W 7 00°.6 � a `P v p 5 $' `�r^ `r `�';,w ,•w .— a "'e ° dlei +APP w'w ii 'ey,W "ri yy i n�itf'0' x ji Ilk, s �ySAMA lP {�w�_�✓ Off` L "`�•m�C,p° vO-g i I ,n`_ %w Fort AbbmaAAL a �%I A'SSE3Stit�t/T piCO _ eQ5 bl I> R AND R TTIA) 6 . SEE 1 •a.7% AITAdW&JT J - P•1W' — / - \ 1 F OR ELEV. l � � 9 s a i�° ' 0r re.a'svt / -' / x p o,,' \id rye . � ♦ \i, \\ f I Yi 9 e "• , Ci 1 rrr/ � • r q2� � /�(/ _fry � �� ` °pEVo / paa • C l � �—� �t oJ5 q, 5, 'glerk. ol, i vx umer s�aJC�- B . L � December 10, 1985 CITY(JF 3 ,: s, 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 (612) 937 -1900 Ms. Michelle Foster Opus Corporation P.O. Box 150 Minneapolis, MN 55440 Dear Ms. Foster: Pursuant to your request for special assessment data, I did con- firm with Carver County that the Business Park 5th Addition split was not recorded in time for revised tax statements to be issued for 1986. Therefore, the following breakdown will appear for the original lot arrangement: Description 1, Block 1986 Payment 1986 Balance $ 8,291.20 Lot 2, Block 1 $ 7,687.16 $ 30,080.21 Lot 3, Block 1 9,345.20 36,568.14 Lot 4, Block 1 10,802.22 42,269.55 Lot 5, Block 1 8,952.44 35,031.28 Lot 6, Block 1 8,032.18 31,430.19 Lot 7, Block 1 11,201.28 43,831.09 Lot 8, Block 1 15,685.64 61,378.59 Lot 9, Block 1 20,183.72 78,979.67 Lot 10, Block 1 19,469.26 76,184.01 If the 5th Addition plat had been recorded for 1986 revision, the following rearrangement, based on lot area, would have been pro- posed: New Description Area (A) 1986 Payment 1986 Balance Lot 1, Block 2 1.8977 $ 8,291.20 $ 32,443.82 Lot 2, Block 2 1.6603 7,253.98 28,385.13 Lot 3, Block 2 3.95 17,257.86 67,530.73 Lot 4, Block 2 6.32, 27,612.58 108,049.17 Lot 5, Block 2 4.64 20,272.53 79,327.24 Lot 6, Block 2 7.02 30,670.94 120,016.64 Consistent with our recent conversation, no assessments in this hypothetical breakdown have been proposed for Outlot A or Lot 1, Block 1. Lastly, it should be noted that the 1986 Balance, as CITY OF 3b CHANHASSEN 690 COULTER DRIVE • P.O. BOX 147 • CHANHASSEN, MINNESOTA 55317 (612) 937 -1900 MEMORANDUM TO: Housing and Redevelopment Authority FROM: Don Ashworth, Executive Director DATE: January 31, 1986 SUBJ: Special Assessment Reduction Request, Sunnybrook Development Background Sunnybrook Development Corporation approached the City approxi- mately two years ago proposing to construct a country inn/ convention center within the City of Chanhassen. The number of businesses in the Twin City /southwest area led Sunnybrook to believe that a facility offering dining /conference /lodging ser- vices in a recreational setting would be well received /prosperous. The facility would represent an approximate $10 million invest- ment. The City Council /Planning Commission approved the land use for Sunnybrook on an approximate 25 acre parcel adjacent to lake Ann Park. The project never commenced as negotiations for the parcel could not be consummated. Current Proposal Sunnybrook continues to desire locating in this area /Chanhassen. Successful negotiations have occurred between Sunnybrook and Opus Corporation for their relocation to a site within the second phase of the business park (Blocks 9, 10 and 11 from attached preliminary plat diagram). As the second phase has not received "final plat" status, the property exists solely as large outlots (see large scale map). I The Planning Commission /City Council are both considering the I request from Opus to final plat that portion of the property they would be purchasing, rezone such, and to initiate the public improvement construction. A preliminary feasibility study has been completed which reflects total public improvements for Phase II (construction of Lake Drive East from CR 17 to Highway 101) would cost approximately $1.5 million. As the improvements would be carried out as a public improvement project, Sunnybrook is requesting that the Housing and Redevelopment Authority include the public improvement construction costs for Phase II under the special assessment incentive program. Housing and Redevelopment Authority January 31, 1986 Page 2 At time of preparing the original special assessment incentive program, consideration was given to how and whether additional projects could be added to that program. The document was writ- ten in such a fashion so as to provide that option td the HRA with the actual institution of such being through an amendment which would add a particular project. Once added to the list of eligible improvement projects, an individual parcel which would or was assessed public improvement costs for said project would be eligible to receive special assessment reductions to a maximum of 78 of the new building's construction value. The question of whether the HRA would consider expanding the spe- cial assessment reduction area from parcels north of the railroad tracks to parcels south of the railroad was presented approxi- mately three years ago. At that time, the HRA determined that the reduction program should not be extended into this area as: - Establishment of second or third phase properties as being eligible for special assessment reduction would take away from the first priority of the HRA, i.e, to insure develop- ment of the first phase as quickly as possible; and - No specific construction request was before the City /HRA necessitating immediate action. As can be seen from the larger ownership map (attached), only two lots (excludes Lots 1 -6 which are proposed for reconfiguration / being served by the new Park Place Road). It is reasonable to assume that the construction of Park Place will occur this summer allowing for Lots 1 -6 to be developed this summer. Past perfor- mance of Opus has proven that all six lots may be sold and construction commenced this year. If such occurs, few properties would be unsold /undeveloped within the first phase. As such, the position of the HRA of three years ago that Phase II was prema- ture is no longer true. It is reasonable to assume that Phase I will be totally sold out by 1987 - the same timeframe proposed for opening of Phase II. This office continues to believe that the special assessment reduction program has been the most successful HRA program. It could be true that Phase II will develop whether the HRA extends the special assessment agreement or not. No one can answer this question with certainty. However, we do know that the existing Phase I has developed with the incentive program in place. As stated earlier, Phase I developments have shown that an approxi- mate 1} years of taxes are required to pay off a 78 incentive. The decision to include Phase II improvements within the special assessment reduction program is solely a judgement decision by HRA members. It is the belief of this office that the existing Housing and Redevelopment Authority January 31, 1986 Page 3 Phase I reduction program has proven its ability to attract highly desirable companies to our community. Again, the argument can be made that that development would have-occurred anyway; however, our track record has been significantly better than the development activities in Chaska /Waconia /Victoria. Such may be solely attributable to spin off development from Eden Prairie. I do not think so and would recommend that the HRA con- ceptually approve including Phase II improvements within the spe- cial assessment reduction program conditioned upon successful construction by Sunnybrook. Should the HRA approve this in con- cept, this office would have the attorney's office draft the spe- cific modifications to the special assessment reduction program for final action by the HRA. The initial economic impact of this recommendation would be a reduction of approximately $200,000 in special assessments which is approximately the same as the pro- posed total assessments against the property. Again, the $200,000 reduction amount would be repaid within 1} years. [Note: The above numbers are very preliminary estimates as no feasibility study exists with final road configurations and spe- cific construction plans have not been submitted by Sunnybrook. As these two factors are dependent upon each other, the specific amount of reduction could significantly vary from that shown. However, the standard of an approximate 1} year pay off would not change regardless of whether the construction was significantly more or less than shown.] Should the HRA determine that Phase II improvements should be included within the special assessment reduction program, two additional points should be noted: - The City /HRA would not be providing two forms of inducement to properties in Phase II, i.e. Lake Drive East is a state aid road and thereby eligible for state aid incentives. As our overall state aid needs are significantly higher than monies available it would be proposed that the state aid dollars remain as a part of the overall system and not be allocated, and thus duplicate reductions, if the special assessment reduction program is approved; and - Outlot B should be initially excluded from the special assessment reduction program. As currently configured, this parcel landlocks the existing Lake Susan Park Shelter property. Opus Corporation is working with City staff to alleviate this problem. Until resolved, it is not prudent to establish an incentive to a parcel for developing when that construction may impair the ability of the City to use its property. Again, I believe this problem can and will l be corrected prior to any final action by the HRA and I am simply providing this caveat as a reminder to both Opus and the City that this issue needs to be resolved. r � U*nniy, br6®�, a country inn and restaurant of distinction September 16, 1985 P.r. Don Ashworth Chanhassen Housing & Rdevelopment Authority 690 Coulter Drive Chanhassen, Minnesota 55317 Dear t,.r. Ashworth: Sunnybrook Development Group does hereby request through the Chanhassen Housing and Redevelopment Authority, that a proposal to the Chanhassen City Council be drawn requesting that Chanhassen Lakes Business Park, 'third Addition, be included as a 'Special Assessment Reduction District. Subsequent to this approval, Sunnybrook Development Group requests a 100% reduction be applied to assessed costs of future improvements projected within and along the Lake Drive East perimeter. Bill P..onk is presently involved in the updating of a feasibilty study pertaining to this area - -- Council, Planning and Staff have reviewed the proposed realignment of Lake Drive East as well as the proposed development; so I trust this request will receive your timely attention. C92h 91171b_ Res ectfully`, Barney Schlender SEP Ui T Y OF CHANHASSEN P.O. Box 472 Chanhassen, Minnesota 55317 (612) 869 -1977 ai 4 f PR[I MjVARY PI-AT � L, 4 99 47 .11)1 a J1 ` 1t 46c� aiS'as�a CY zff 3 2DI.c S CD /, �'�1 )1 )d `!` U yi,� t� /� f J' ,� \\ /,Ja 1\3 1// •�, __ j���„i /� J a�\ aq,�. iz vim. t l e� /; 1 �� %/� /�i9�.? 1t \�/ _ v `9� 2'02,,,r .a`3 9 _ •,- , x3A�� 4 S \� J ^Lim /'c 11 1' 999 „''�i� ,. Y � I¢ oul'F0.rd < Y �h` � "� { �e 7 ,r� 'L�” : •'� MA ���5� zs9 27 zx'' .r- !_.,.- ' zsc .,�� -- `� L3� 3AC ✓�—T . \� "f\ �G � � _- ��'� �, �..�" ssa• t� if' 1.4..f�. 21,, i 1 .3 1 36ac Lake Susan' , i. �i sAft ArAr S ffousin,gAlliance To: Chanhassen Housing Redevelopment Authority From: CHADDA Re: January Report Date: January 23, 1986 This report will present the following items for your consideration: 1. Preliminary development concept 2. Expanded timeline leading to presentation in March 3. Outline of material to be included in March proposal DEVELOPMENT CONCEPT The preliminary development concept is graphically represented by the two attached site plan drawings titled "Upper Level Site Plan" with entries on the north and west end and the "Lower Level Site Plan" with entries on the south. It is envisioned that the change in grade from the north side of the complex to the south side offers the opportunity to create a two —level scheme. This concept separates the "specialty retail ", hotel and entertainment components on the upper level from the community —based activities and entertainment located on the lower level. The proposed floor plan is organized in a "T" configuration. The three ends of the "T" are terminated by "magnates" or attractions which encourage movement between them. The hotel and dinner theater are at the top and the community spaces at the bottom. The top of the "T" would be built in one phase connecting the hotel and the dinner theater. The leg of the "T" would follow in a later phase connecting the community space. Parking would be available around the entire perimeter of the complex with a 3 —level parking ramp proposed for the west end, adjacent to the hotel. Office space is planned for the east side of the dinner theater to enhance the new "angled" entry street from highway 101 and highway 5 from the south. The design of the convenience retail (north of P78th street) and the office /professional service /retail component (west of the dinner theater) is largely a matter of tenent mix. Our initial focus has been on the specialty retail component due to the complex nature of the interrelationship of the different uses i and their placement within the context of existing structures. I�wk,[ Anrlh Bmlilin,p. SUiio 200 :10 Piiwl ,Aavum V'aih 1l ii ui,•n pubs. ,Alin nvsna `d�40a l loph ailn 612.:134. 6122 k Page 2 TIMELINE The attached presentation working with Image design Presentation remainder of timeline focuses on the tasks leading to our in March. We will spend the remainder of January our consultants refining the basic design concept. will occur the first two weeks of February. materials, including a site model, will require the February and the first two weeks in March. PROPOSAL PACKAGE The project proposal will contain the following basic components: 1. Redevelopment program & project description 2. Design concept plan and project image 2. Summary market analysis and recommendations 4. Implimentation & phasing plan 5. Financial analysis by phase 6. Exhibits (Including letters of interest and support by the business community) 7. Relocation plan for displaced businesses We wish to emphasize that we are still formulating our redevelopment program as we proceed with the preliminary design phase. The ultimate design concept and plan configuration may change as it is refined in the coming weeks. r - • • 1 r r r r r • r r r r r 0 r r r r B ^r ^1 1 ^1 ^5 n /99-5 CHANHASSEN H.R.A. A C C O U N T S P A Y A B L E 01 -27 -86 PAGE 1 CHECK A M 0 U N T C L A I M A N T P U R P O S E 026006 7,819.60 BRAUER 6 ASSOCIATES FEES, SERVICE 026007 12.51 MERLINS HARDWARE HANK MAINTENANCE MATERIALS 026008 026009 555.00 2,259.75 BERRY ROOFING ROMAS ROOS REP. ♦ MA1NT.,BLDG ♦ REFUNDS r RE- IMBURSE. ONNCO? �1 10,606.90 CHECKS WRITTEN TOTAL OF 0 CHECKS TOTAL 10,606.90 B ^r ^1 1 ^1 ^5 n • A• r r r r r 0 • r r r r r O • r r f r 1986 CHANHASSEN N.R.A. A C C 0 U N T S P A Y A B L E 01 -27-86 PAGE 1 CHECK 1 A M O U N T C L A I M A N T P U R P O S E 026128 49.52 ASHWORTH DONALD TRAVEL ♦ TRAINING 1 49.52 CHECKS WRITTEN n 1 1 1 1 1 CITY OF CHANHASSEN HRA A C C O U N T S P A Y A 0 L E 01 -21_86 PACE 2 CHECK I A M O U N T C L A I M A N T P U R P O S E ^ 023336 2,320.00 JACK HENNING FEES, SERVICE 023340 6,625.00 J.L.H. CONSTRUCTION REP. . MAINT.,BLDC ♦ ONG Repelee to old IN Bltlg. 8,945.00 NECESSARY EXPENDITURES SINCE LAST COUNCIL MEETING