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HomeMy WebLinkAbout1987-11-16 HRA Regular Meeting MINUTES EDINA HOUSING AND REDEVELOPMENT AUTHORITY • NOVEMBER 16, 1987 Answering rollcall were Commissioners Kelly, Richards, Smith, Turner and Courtney. MINUTES of the HRA Meeting of November 2, 1987 were approved as submitted by motion of Commissioner Turner, seconded by Commissioner Richards. Ayes: Kelly, Richards, Smith, Turner, Courtney Motion carried. The meeting was adjourned to the public hearing on the Parking Ramp Addition, Improvement No. P-P1B (Council Agenda Item III.A) . The Edina Housing and Redevelopment Authority re-convened with the Council for the public hearing on the Parking Ramp Addition, Improvement No. P-P1B, and action was taken as recorded. PUBLIC HEARING CONDUCTED ON PARKING RAMP ADDITION (WEST 51ST STREET) : PROJECT AUTHORIZED (IMPROVEMENT NO. P-P1B) . Affidavits of Notice were presented by Clerk, approved and ordered placed on file. Gordon Hughes, Assistant Manager, recalled that on September 14, 1987 the Council approved the Final Development Plan of Cineplex Corporation for expansion of the Edina Theatre at 3911 West 50th Street. The approval was conditioned on the expansion of the 51st Street parking ramp by way of the addition of a third parking level containing 111 spaces. In that a portion of the cost of the expansion may be financed by special assessments a project hearing was scheduled and notices were sent to all property owners in the 50th and France commercial area who potentially could be assessed for the ramp • cost. The estimated cost for the ramp expansion is $682,000 according to Walker & Associates, the City's ramp consultants. Staff also requested the consultants to estimate the cost of upgrading the easterly and southerly facade of the new level as well as the existing levels of the ramp. Adding a brick facade to these two sides is estimated to cost $78,000 which would increase the overall project cost to $760,000. Staff recommended the inclusion of the facade upgrading as part of the project. As requested by the Council on September 14, 1987, staff has put together several alternatives for the potential assessment which are the most feasible. Alternative #1 - Based upon Cineplex Odeon's offer to accept a special assessment equal to 20% of ramp expansion costs. This is consistent with the original 50th & France assessment percentage as well as the policy followed recently with the Grandview ramp: Cineplex Assessment - $152,000, Tax Increment Financing $608,000, Total $760,000. Alternative #2 - Attempts to tie Cineplex's special assessment with its expected parking demand. According to Barton-Aschman's parking analysis the theatre expansion will demand 33 additional parking spaces during matinees which occur coincidentally with peak commercial district parking demand. Thirty-three spaces equal 30% of the ramp expansion. Therefore, Cineplex should bear 30% of the expansion cost: Cineplex Assessment - $228,000, Tax Increment Financing $532,000, Total $760,000. Alternative #3 - Provides that all commercial district properties should bear a portion of the ramp expansion costs. Assuming that these properties should be assessed 20% of the cost, the following alternatives are possible: A B Cineplex (20%) $152,000 Cineplex (30%) $228,000 Commercial Area (20%) 152,000 Commercial Area (20%) 152,000 Tax Increment 456,000 Tax Increment 380.000 $760,000 $760,000 • Alternative #4 - Based on the concept that sufficient tax increments are now and will be generated to finance the parking ramp expansion in its entirety. However, tax increment financing cannot be used for maintenance purposes. The City presently budgets approximately $45,000 annually for ramp maintenance and HRA Minutes of 11/16/87 Page Two electricity expenses at 50th & France. Under this alternative, the special assessment against Cineplex would be applied against the City's maintenance • expenses rather than against the HRA's ramp construction costs. The total amount of assessment could still be based on the amounts suggested in Alternatives #1 and #2. However, the term of the assessment could be lengthened to provide a more stable revenue source for maintenance purposes. A 20-year term and 9% interest rate would result in the following annual payments: Assessment Amount Annual Payment $152,000 $16,651.60 228,000 24,977.00 Staff recommendation is that Alternative #4 be selected based upon a total Cineplex assessment of $228,000 and that the project be approved, subject to an executed agreement from Cineplex Odeon Corporation consenting to the assessment and waiving right of appeal. In conclusion, Mr. Hughes noted that Peter Kofman, representing Cineplex Odeon Corporation, and Perry Anderson, representing the 50th and France Business & Professional Association, were present to answer questions. Commissioner/Member Kelly asked if the tax increment money would be needed for any other project in the district and if so could the district support both at the same time. Mr. Hughes said that the only other potential need would be for additional parking as pointed out by the 50th & France merchants at the meeting of September 14. Because of the present excess increments the present ramp expansion would be paid off relatively quickly with increments remaining for future projects and if the ramps were of approximately the same cost, the district could support both projects. He pointed out that projected increments do not take into account the value of the theatre expansion itself which would increase the figures. There is also a policy question to be considered and that is should the district stay in existence. Commissioner/Member Kelly stated that she believed that the district should stay in existence; that what the City is doing at 50th and France is what • the tax increment district was originally designed to do and that the 50th and France commercial area is vitally important to the community. She said she would support assessment Alternative #4. Commissioner/Member Turner asked if the City now has the ability to assess the property owners at 50th and France for ramp maintenance costs. She recalled that from time to time at budget hearings the Council has talked about the approximately $40-50,000 cost of maintaining the ramps. Responding, Mr. Hughes said that after completion of the redevelopment project the City adopted an ordinance in 1976 that was inclusive in nature and permitted the Council on an annual basis to assess maintenance costs (e.g. landscaping, maintenance of ramps, snow removal, lighting) back to the property owners within the 50th & France Commercial Area. Commissioner/Member Kelly commented that the issue is should the business/commercial property owners pay for the cost of ramp maintenance or should the people who use the ramps also contribute to the cost. Commissioner/Member Turner said there are a couple of philosophical questions. If all of the costs come out of the Tax Increment District then the whole City is paying all of the costs and none of the benefitted property owners are paying. The City has to take a look at the balance of who pays for the maintenance - those specially benefitted or the whole City that is benefitted - and how the cost is proportioned. Mayor Courtney then called for public comment on the proposed project. Alice Holmberg, The Lanterns Condominiums, said she was concerned about the increased traffic that would occur and asked if any provisions were being made for pedestrians, especially in the winter months with the buildup of ice and snow, to get to the stores. Engineer Hoffman explained that the ramp project proposed would be construction of an additional level and would not change pedestrian access to the 50th and France area. Commissioner/Member Kelly suggested that this concern be addressed by the Traffic Safety Committee. Dick Moberg, representing a partnership that owns • property just east of the theatre and adjacent to the parking ramp, stated that they favored the ramp project but were concerned about the following: 1) Ramp parking provides traffic to a number of businesses on the east side of the ramp (France Avenue) . Pedestrian traffic must be maintained to those businesses during HRA Minutes of 11/16/87 Page Three construction of both the theatre and the ramp expansion so that those businesses are not affected negatively; 2) Trash removal - provision should be made for • access to a dumpster, presently located in the ramp, during construction, 3) Completion time of construction projects - because retail business is seasonal with spring and fall the busy seasons, the projects should be timed so as to have minimal impact on retailers. In reply, Engineer Hoffman said that for the ramp construction the pedestrian traffic could be routed around the construction area and the trash dumpster could be relocated. With regard to the theatre expansion project, it will be difficult to keep the access to 50th Street open without some special provision. Peter Kofman, representing Cineplex Odeon Corporation, reiterated the position of Cineplex Odeon as stated in his letter of November 12, that they would favor either assessment Alternative #1 or Alternative #4 as their contribution to the ramp expansion project. Mayor Courtney reported that he had received a telephone call from a resident of The Lanterns expressing concern that the ramp addition will cut off daylight for those on the first floor. Commissioner/Member Turner asked for a review of the data that had been presented previously in support of the ramp expansion. Mr. Hughes said that at the meeting of September 14 the Council had reviewed parking surveys for several time periods from 1978 to the Fall of 1987. Those counts were combined with some estimates done by a consulting engineer for the theatre that predicted the amount of parking demand that will result from the theatre addition. It was the conclusion of that report that the theatre, particularly during matinees, would generate enough demand for parking at the same time as the business community has need for parking resulting in more demand than supply. The City's parking ramp consultant was also asked to look at other parking alternatives: 1) construction of a parking deck above Clancy's parking lot, and 2) construction of a parking deck above the 49 1/2 Street parking lot. Concerns regarding those alternatives were that a parking deck above Clancy's lot would only produce an increase of 36 spaces and the • parking deck above the 49 1/2 Street would produce 82 new spaces but would create a traffic congestion problem at the intersection with the access to Clancy's lot and the north ramp. Based on those facts, it was the recommendation that if additional parking was needed because of the theatre expansion that it would best be accomplished by an expansion of the ramp on 51st Street. Margaret Ryan, The Lanterns, questioned the assumption that more people will come to the theatre if it is expanded and said that more people are looking at videos at home now. She said that she has observed that the ramp is vacant most of the time. Mr. Hughes explained that the studies generated by the theatre's consultant were based on an attendance survey, questionnaires and interviews with theatre patrons and we have to rely on their predictions as to theatre occupancy. Their anticipated occupancy of the four auditoriums was checked with the Southdale Theatre which is similar in size and it was found that the percentages of occupancy predicted for the expanded Edina Theatre were similar to what was actually experienced at Southdale. Staff concluded that the parking study accurately predicted what the parking demand will be. Catherine Buckman, The Lanterns, said she was opposed to any assessment of the ramp costs against residents of The Lanterns condominiums. Mr. Hughes clarified that it is not proposed that any portion of the ramp construction costs would be assessed against residents of The Lanterns. Commissioner/Member Richards commented that his concern was the proposed method of who pays for the parking ramp expansion. He said he felt this was a direct subsidy of private business and that there is no benefit as to the 50th & France corner. The City has the mechanism now by which to assess maintenance and if the Council were to approve assessment Alternative #4 it would take the capital assessment from Cineplex to pay for the ongoing maintenance which would relieve the 50th & France commercial properties from that annual maintenance obligation. Commissioner/Member Richards said he that the theatre should bear an assessment for the ramp expansion for the • reason that this project is needed because of the proposed theatre expansion, that the City has always use that method to finance this type of project, and that he would support Alternative #3. Commissioner/Member Smith said he concurred that the assessment to the theatre should not be applied against ramp maintenance HRA Minutes of 11/16/87 Page Four expenses. Member Kelly said it was her understanding that the commercial properties were being assessed for some of the ramp maintenance. Engineer Hoffman explained that expenses for the 50th & France area are paid by the following: 1) the City annually assesses the commercial properties for extraordinary expenses such as upkeep of walkways, replacement of tiles, etc. ; 2) there is a General Fund budget item for ramp maintenance, e.g. snowplowing, electricity; and 3) employees of those businesses are charged a ramp parking fee and those fees in the past have paid for ramp improvements or repairs (e.g. south ramp renovation) . Commissioner/Member Turner commented that it was very appropriate for the City to have established the 50th & France Tax Increment District because it benefitted the whole City. The City also established a policy whereby the cost of improvements in the district would be assessed 20% against benefitted properties and the district would pay 80%. She stated she would support assessment Alternative #1 with the addition of assessing the maintenance costs of the ramps against all the 50th & France commercial properties so that the annual amount of money coming from the General Fund would no longer be needed. This would continue the policy that has been used throughout the City in tax increment districts and would appropriately balance the maintenance assessment against those benefitted. The Council briefly discussed the issue of when the tax increment district should be retired. Attorney Erickson opined that the district could be liquidated prior to 1993 if sufficient tax increment funds were placed in a sinking fund with which to pay off the outstanding bonds. Because the 50th & France Tax Increment District was created prior passage of laws which make creation of districts more difficult and less advantageous, he cautioned against releasing the district early and then having to re-create another district because other projects, such as additional parking, are needed. Following further discussion on the assessment alternatives, Commissioner/Member Smith moved adoption of the following resolution, conditioned on execution of suitable agreements with Cineplex Odeon Corporation: RESOLUTION ORDERING PARKING RAMP ADDITION IMPROVEMENT NO. P-P1B BE IT RESOLVED by the Housing and Redevelopment Authority (HRA) and Council of the City of Edina, Minnesota, that the HRA and this Council heretofore caused notice of hearing to be duly published and mailed to owners of each parcel within the area proposed to be assessed on the following proposed improvement: PARKING RAMP ADDITION IMPROVEMENT NO. P-P1B and at the hearing held at the time and place specified in said notice, the HRA and Council has duly considered the views of all persons interested, and being fully advised of the pertinent facts, do hereby determine to proceed with the construction of said improvement, including all proceedings which may be necessary in eminent domain for the acquisition of necessary easements and rights for construction and maintenance of such improvement; that said improvement is hereby designated and shall be referred to in all subsequent proceedings as PARKING RAMP ADDITION IMPROVEMENT NO. P-P1B and that Cineplex Odeon Corporation shall be specially assessed for 30% of the construction cost thereof with the remaining cost to be paid by tax increment funds from the 50th & France Tax Increment District. Motion for adoption of the resolution was seconded by Mayor Courtney. Rollcall: Ayes: Smith, Richards, Courtney Nays: Kelly, Turner Resolution adopted. Commissioner/Member Turner said that the other policy issue remaining is assessment of the ramp maintenance costs. Engineer Hoffman suggested that staff prepare background information for Council and that this be brought back for discussion at the next meeting. Motion of Commissioner Smith was seconded by Commissioner Turner r Journment of the HRA. Ayes: Kelly, Richards, Smith, Turner, Courtney Motion carried. Exec tide D rector