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HomeMy WebLinkAbout2024-12-19 Regular HRA Meeting MinutesMINUTES OF THE REGULAR MEETING OF THE EDINA HOUSING AND REDEVELOPMENT AUTHORITY DECEMBER 19, 2024 7:30 A.M. I. CALL TO ORDER Chair Hovland called the meeting to order at 7:32 a.m. then explained the processes created for public comment. It. ROLLCALL Answering rollcall were Chair Hovland, Commissioners Agnew, Jackson, and Risser. Absent: Commissioner Pierce III. PLEDGE OF ALLEGIANCE IV. MEETING AGENDA APPROVED — AS PRESENTED Motion by Commissioner Jackson, seconded by Commissioner Agnew, approving the meeting agenda as presented. Ayes: Agnew, Jackson, Pierce, Risser, and Hovland Motion carried. V. COMMUNITY COMMENT No one appeared. V.A. EXECUTIVE DIRECTOR'S RESPONSE TO COMMUNITY COMMENTS Executive Director Neal responded there were no past Community Comments. VI. ADOPTION OF CONSENT AGENDA AS PRESENTED Motion by Commissioner Jackson, seconded by Commissioner Agnew, approving the consent agenda as presented: VI.A. 2023 AFFORDABLE HOUSING COMPLIANCE REPORT VI.B. DRAFT MINUTES OF REGULAR MEETING OF NOVEMBER 14, 2024 AND SPECIAL HRA MEETING OF DECEMBER 3, 2024 VI.C. APPROVE 2025 HRA MEETING CALENDAR Ayes: Agnew, Jackson, Pierce, Risser, and Hovland Motion carried. VII. REPORTS AND RECOMMENDATIONS VII.A. REDEVELOPMENT AGREEMENT FOR 7200 FRANCE AVE APARTMENTS AND FIRST AMENDMENT TO THE 7200-7250 REDEVELOPMENT AGREEMENT — APPROVED Affordable Housing Development Manager Hawkinson stated she is seeking support for the proposed development. She presented information regarding the site location, existing redevelopment agreement, existing TIF district, adopted PUD and preliminary Site Plan approval, additional public benefits, 10-year historical tax base growth, proposed tax base growth, cost drivers, recommended loan terms, history of SPARC, requirements of SPARC, the use of SPARC funds, and the affordable housing scorecard. Affordable Housing Development Manager Hawkinson also discussed the hypothetical situations for the proposed redevelopment agreement amendment. Page 1 Minutes/HRA/December 19, 2024 The Board asked questions regarding how hypothetical #3 will lower the tax base in the future, investments for the additional 3 units proposed, and where the tax revenue from 7200 France Avenue goes. Nick Anhut, Ehlers and Associates, stated that they have the benefit of the original agreement, which contemplated a hotel, meaning the property classification is slightly different from a rental property, and it is a lower taxable valuation. Affordable Housing Development Manager Hawkinson stated that the difference between the market rate rents, and the affordable rents decreases the overall net operating income, which creates the gap. She stated that the gap is $324,000 per unit at 15 units. She noted that the gap is consistent with what they have seen as a loss of revenue for having affordable units in the past. Affordable Housing Development Manager Hawkinson stated that the tax revenue from 7200 France Avenue would go back into the regular tax base. The Board asked what TIF financing can be used to pay for and if they can be used for aesthetics. Jay Lindgren, Dorsey and Whitney, stated that TIF can be used for placemaking and elements that are not purely just decorative. He stated that they are paying for other gaps within the project, not necessarily the things that could be considered more decorative pieces. The Board expressed concerns regarding the SPARC funds and total costs not being reported. Affordable Housing Development Manager Hawkinson stated that when affordable housing within a market -rate building the cost rests on the City rather than being spread out among the different funding sources. She stated that staff recommends hypothetical #2 for the long-term benefit for the City. The Board expressed feedback regarding finding a balance, larger additional units, what else could be done with the SPARC fund money, and mitigating risk. Motion by Commissioner Jackson, seconded by Commissioner Agnew, approving Redevelopment Agreement for 7200 France Avenue Apartments reflecting the terms and conditions of 15 units (10%) affordable for perpetuity and First Amendment to the 7200-7250 Redevelopment Agreement. Ayes: Agnew, Jackson, and Hovland Nay: Risser Motion carried. VII.B. REQUEST TO MODIFY LOAN AGREEMENT WITH EDINA CHAMBER OF COMMERCE Economic Development Manager Neuendorf said this item pertained to updating the Board on the Loan Agreement with the Edina Chamber of Commerce. He presented information regarding the background information on this item. Shelly Loberg, Edina Chamber of Commerce, asked the Board for a deferment of the February payment. Annette Wildenauer, BIG Innovation Lab, stated that the BIG Innovation Lab is a business accelerator for second -stage businesses and helps them move forward and find next steps for their businesses. Page 2 Minutes/HRA/December 19, 2024 Bryan Ruch, Groveland Confections, stated that he was looking for a way to grow his business and did not have the assets to do that; however, being a part of the lab has helped his business aggressively expand. Logan Hershey, RBC Wealth Management, stated that from the beginning he wanted to be part of the lab and now the lab has helped him grow his business and determine how to best spend his time to do that. The Board asked questions and provided feedback regarding new revenue streams with other cities, stockholders for the innovation lab, what repaid SPARC funds are used for. Annette Wildenauer, BIG Innovation Lab, stated that they have engaged in conversations with Bloomington and Golden Valley to help those cities grow and build their businesses. The Board requested allowing for community space for City Council to have office hours at the lab. Economic Development Manager Neuendorf stated that the loan is with the Edina Chamber of Commerce. He also noted that the repaid SPARC funds are used for excess TIF money and then redistributed. Nick Anhut, Ehlers and Associates, stated that for any excess TIF, the HRA has 9 months to return those funds to the County for redistribution. The Board asked about forgivable elements of the SPARC loan to the Chamber that would further reduce the outstanding balance. The Board asked for as much detail as possible when the Chamber of Commerce returns with its formal request in January. Vlll. EXECUTIVE DIRECTOR COMMENTS — Received IX. HRA MEMBER COMMENTS — Received X. ADJOURNMENT Motion made by Commissioner Agnew, seconded by Commissioner Jackson, to adjourn the meeting at 9:18 a.m. Ayes: Agnew, Jackson, Pierce, Risser, and Hovland Motion carried. _�— Respectfully submitted, Scott Neal, cecu v NrEkr Page 3