HomeMy WebLinkAbout2022-02-10 HRA Regular Meeting MinutesMINUTES
OF THE REGULAR MEETING OF THE
EDINA HOUSING AND REDEVELOPMENT AUTHORITY
FEBRUARY 10, 2022
7:30 A.M.
1. CALL TO ORDER
Chair Hovland called the meeting to order at 7:36 a.m. then explained the processes created for
public comment.
II. ROLLCALL
Answering rollcall were Commissioners Anderson, Jackson, Staunton, and Chair Hovland.
Absent: Commissioner Pierce.
Ill. PLEDGE OF ALLEGIANCE
IV. MEETING AGENDA APPROVED — AS PRESENTED
Motion by Commissioner Jackson, seconded by Commissioner Staunton, approving the
meeting agenda as presented.
Roll call:
Ayes: Commissioners Anderson, Jackson, Staunton, and Chair Hovland
Motion carried.
V. COMMUNITY COMMENT
No one appeared.
VI. CONSENT AGENDA ADOPTED — AS PRESENTED
Member Anderson made a motion, seconded by Member Staunton, approving the
consent agenda as presented:
VI.A. Approve minutes of the Regular Meeting January 6, 2022
VI.B. Approve Payment of Claims for HRA Check Register dated December 2021
totaling $1,024,696.23
VI.C. Approve Edina Housing Foundation Appointments
Rollcall:
Ayes: Commissioners Anderson, Jackson, Staunton, and Chair Hovland
Motion carried.
VI1. REPORTS/RECOMMENDATIONS
VII.A. LOAN FOR THE DEVELOPMENT OF 4040 WEST 70TH STREET— APPROVED
Affordable Housing Manager Hawkinson said this item was being presented to approve a loan for
the development of 4040 West 70th Street because due to rent restrictions affordable housing could
not be financed through debt financing alone. She said the developers of 4040 West 70th Street, a
118-unit age restricted affordable housing development to be known as Cornelia View Apartments,
were seeking up to $2,000,000 in gap financing from the HRA. Ms. Hawkinson said the developers
had secured Housing Revenue Bonds from Minnesota Management and Budget (MMB) and gap
financing from Hennepin County and the Metropolitan Council and need an award of this remaining
gap to assure a June closing as required by MMB. She noted the developer would continue seeking
other sources which, if awarded, would be used to reduce the loan amount from the HRA then
commented on the need for more affordable housing in the City. She stated the affordability of this
project would be for 99 years and said the project would be ideal for seniors based on proximity to
transit, medical services, The Galleria, and other uses then reviewed reasons for the need for public
funding. Ms. Hawkinson shared that an additional $712,000 had been preliminarily awarded by a
committee of the Metropolitan Council and while full action was pending if awarded the gap would
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be reduced to just over $1.3 million. She shared more about potential budget implications that
would result in future funding capacity of approximately $5.3 million then reviewed the loan terms
of two percent simple interest for 40 years or upon repayment of the first mortgage.
Nick Anhut, Ehlers and Associates, shared about the numerous sources of funding available and how
the potential contribution was likely to decrease. He said the proposed structure was not unique
then explained more about the proposed pay-as-you-go TIF note.
Alex Sellke, Dorsey and Whitney, spoke about the proposed standard financing structure which was
in line with the market then noted the duration of affordability was unique and would be a benefit
to the community.
The Board asked questions and provided feedback.
Member Jackson made a motion, seconded by Member Staunton, to approve a loan in
an amount not to exceed $2 million for the affordable housing development at 4040
West 70th Street and authorize staff to work with council on finalizing loan documents.
Roll call:
Ayes: Commissioners Anderson, Jackson, Staunton, and Chair Hovland
Motion carried.
VII.B. 7001 FRANCE AVENUE — RECOMMENDED TERMS FOR TAX INCREMENT
FINANCING — APPROVED
Economic Development Manager Neuendorf said this item pertained to the potential use of TIF to
support redevelopment of commercial property located at 7001-7025 France Avenue. He said the
developer had secured preliminary zoning approvals and requested that the City and HRA participate
in the financing of the redevelopment project. Staff had engaged legal and financial experts to review
the developer's request. Mr. Neuendorf said a Term Sheet had been prepared to identify the key
terms and conditions by which Tax Increment Financing could be used to make this project financially
viable and that staff recommended that the Term Sheet be approved. He spoke about the boldness
of the project and the developer's request for $22-$25 million over 15 years to make redevelopment
of this site viable and how the gap could be resolved through a combination of tax increment
financing and DEED or Metropolitan Council grants. Mr. Neuendorf outlined the project in detail
that would include office, residential and parking elements and the estimated increased market value
and property taxes which would help the community. He outlined the proposed phasing of the
entire project with a project cost of $136.1 million for the housing component and $1 15.5 million
for the office/parking component. He shared about eligible TIF costs which totaled $52.4 million
but that staff recommended approximately $22 million based on public benefit and explained how
but/for the use of TIF the project could not proceed. He commented on the change in mindset
from national investors overall in the Twin Cities area and how the developer would bear all financial
risk then outlined staging which would begin 2023 with Phase II to begin within five years. He
outlined the project's elements which included public parking, enhanced design features, safety and
security features incorporated within, bike storage and repair facility, permanent easements for
private roads and sidewalks, increased connectivity, and how the project would change the direction
and tone of site design and would allow more walkability as well as sustainability features.
Jay Lindgren, Dorsey and Whitney, shared comments regarding the project that included while this
would be a complicated project it was typical and within market and that the request was reasonable.
He noted staff had narrowed the TIF component to be far below what Statute required and that the
project met the but/for test. He said the project was designed to be two -phased and in order for it
to be a gateway project there would be a risk should both phases not be completed, however
mitigations had been incorporated that for a $5 million TIF note the City would gain 118 stalls of
public parking as well as the street grid pattern, which was a greater cost than the Phase I TIF note.
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Mr. Lindgren noted the public parking would provide stalls and help bridge a gap to provide
commercial level parking on Site C that benefitted Site B and while allowed by law was different than
done in the past. He noted staff had attempted to mitigate this element by including a perpetual first
right that should parking be no longer needed the City would have first -right of offer to acquire the
property for other uses then noted it the developer did not wish to construct the parking as part
of Phase II a lease amendment would be needed and terms renegotiated.
The Board asked questions and provided feedback.
Member Jackson made a motion, seconded by Member Staunton, to approve the
creation of a 15-year renewable TIF district, approve term sheet to include two TIF
notes not to exceed $22 million (8.7% of project cost) based on the completion of phases
and delivery of public benefits, and authorization to prepare binding legal agreements
based on these terms.
Roll call:
Ayes: Commissioners Jackson, Staunton, and Chair Hovland
Nays: Commissioner Anderson
Motion carried.
VIII. HRA COMMISSIONERS' COMMENTS — Received
IX. EXECUTIVE DIRECTOR'S COMMENTS — Received
X. ADJOURNMENT
Motion made by Commissioner Jackson, seconded by Commissioner Staunton, to
adjourn the meeting at 9:15 a.m.
Roll call:
Ayes: Commissioners Anderson, Jackson, Staunton, and Chair Hovland
Motion carried. 1 1
Respectfully submitted, ` C`
`-Scott Neal, Executive Director
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