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HomeMy WebLinkAbout2020-02-13 HRA regular minutesMINUTES OF THE REGULAR MEETING OF THE EDINA HOUSING AND REDEVELOPMENT AUTHORITY FEBRUARY 13, 2020 7:30 A.M. 1. CALL TO ORDER Chair Hovland called the HRA meeting to order at 7:30 a.m. 11. ROLL CALL Answering rollcall were Commissioners Anderson, Brindle and Chair Hovland. Absent: Commissioners Fischer and Staunton. ►II. PLEDGE OF ALLEGIANCE IV. APPROVAL OF MEETING AGENDA — AS PRESENTED Motion made by Commissioner Anderson, seconded by Commissioner Brindle approving the meeting agenda as presented. Ayes: Anderson, Brindle and Hovland Motion carried. V. COMMUNITY COMMENT No one appeared. VI. APPROVAL OF CONSENT AGENDA — AS PRESENTED Motion made by Commissioner Brindle, seconded by Commissioner Anderson approving the consent agenda as presented. VI.A. Minutes of the Regular Meeting of January 16, 2020 Ayes: Anderson, Brindle and Hovland Motion carried. VII. REPORTS/RECOMMENDATIONS VII.A. APPROVING LOAN AGREEMENT WITH EDINA HOUSING FOUNDATION FOR THE PURCHASE OF 4040 W. 70TH STREET - APPROVED Affordable Housing Manager Hawkinson explained that on December 12, 2019 the Housing & Redevelopment Authority reviewed and approved a Term Sheet that identified the basic business points supporting the use of public funds for the acquisition by the Edina Housing Foundation (the "EHF") of 4040 W. 70th St. (the "Site") from American Collectors Association. The purpose of this acquisition was to provide the EHF with the opportunity to secure a developer for the construction of age -restricted, affordable housing estimated at 118 units. The Term Sheet was intended to serve as the general framework of a Loan Agreement to be executed between the EHF and Edina HRA. City Council held a Public Hearing December 17 regarding modifying the Southeast Edina Redevelopment Project Area and TIF Plan that would allow Southdale 2 TIF Pooled funds to be used for this acquisition. She outlined the proposed Loan Documents between the HRA and EHF and highlighted business terms outlined in the Term Sheet that included a $3,650,000 loan secured by a non -recourse mortgage, zero percent interest for two years with two one-year extensions. As allowed in the Purchase Agreement, the seller had opted to extend the closing date until June I, 2020, therefore the Maturity Dale of the Loan Documents was June I, 2022. Ms. Hawkinson said the Foundation would actively seek a developer through a competitive Request for Proposal process; review the proposals for developer experience, capacity and quality of work; and conduct interviews, and noted the Greater Southdale District Plan supported the development of affordable age - restricted housing. She shared next steps that included EHF solicitation for development proposals this spring with selection by fall and Planning Commission and City Council in 2021. The Commission inquired about the meaning of a non -recourse loan. Alex Sellke, Dorsey & Whitney LLP, explained if there was a loan default the HRA remedy would be to take the property back as lenders rights were in the property instead of repayment. Page I Minutes/HRA/February 13, 2020 Ms. Hawkinson added the Foundation did not have assets to pay back in cash if in default and this protected them from being sued as individuals or as the Foundation. The Commission confirmed insurance was in place that insulated Board members in that instance then clarified the TIF district limit of 40 years referred to the affordability of the project and not the term. Motion made by Commissioner Anderson, seconded by Commissioner Brindle to approve the Loan Agreement, Promissory Note and Mortgage ("Loan Documents") between HRA and Edina Foundation documents for $3.65 million. The Commission confirmed the maturity date was two years then commented how when first brought forward there were concerns about the City conducting development but noted this action would create a much -needed housing type with age -restricted housing and hoped a non-profit developer with experience in this housing type would be identified as this location would be good for senior housing. Ms. Hawkinson clarified the maturity also included two one-year extensions. Ayes: Anderson, Brindle, and Hovland Motion carried. VII.B. AUTHORIZATION OF ACQUISITION OF 42S JEFFERSON AVENUE SOUTH, ED►NA - AUTHORIZED Executive Director Neal explained City staff had been working with the owners of 425 Jefferson Ave. S. to abate property maintenance nuisance conditions and the property had caused disruption and discontent in the neighborhood for the past two years. City staff approached the owners with a tentative proposal to purchase the real estate and abandoned personal property and they expressed interest in the tentative proposal. He stated staff would like the HRA's authorization before moving forward with any tentative proposal. He said staff propose would use funds from the City's Affordable Housing Trust Fund for acquisition and use the rehabilitated property as part of the affordable housing initiative and would present a firm plan for how the property would be used when a final purchase agreement was presented to the HRA later this spring for an affordable single-family home. The Commission spoke about interest in this property and impacts on the immediate neighborhood and if the property had been inspected. Mr. Neal said staff had inspected the property and noted since the photos were taken a house fire had occurred which complicated the property further. He said he hoped the property could be rehabbed and disposed for management by an affordable housing organization. The Commission said precedent was set when situations like this arose and was pleased we could take advantage when present to benefit all involved. They thanked the neighborhood for bringing this property to the City's attention and said they liked the flexibility when public health and safety concerns needed to be addressed. They referred to another property 58th and Wooddale and how this would go better working with the Housing Foundation and develop a land trust as a great solution for all involved. Motion made by Commissioner Anderson, seconded by Commissioner Brindle to authorize Executive Director to negotiate a tentative purchase agreement for 425 Jefferson Avenue South. Ayes: Anderson, Brindle, and Hovland Motion carried. Vlll. CORRESPONDENCE — RECEIVED IX. HRA COMMISSIONERS' COMMENTS - RECEIVED X. EXECUTIVE DIRECTOR'S COMMENTS X►. ADJOURNMENT Chair Hovland adjourned the HRA meeting at 7:55 a.M ­ - ..... Respectfully submitted, ' Scott Neal Executive D hector %`