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HomeMy WebLinkAbout2021-01-28 City Council Meeting PacketAgenda Edina Housing and Redevelopment Authority City of Edina, Minnesota VIRTUAL MEETING Thursday, January 28, 2021 7:30 AM Watch the meeting on cable TV or at EdinaMN.gov/LiveMeetings or Facebook.com/EdinaMN. To participate in Community Comment: Call 800-374-0221. Enter Conference ID 6186549. Give the operator your name, street address and telephone number. Press *1 on your telephone keypad when you would like to get in the queue to speak. A City sta; member will introduce you when it is your turn. I.Call to Order II.Roll Call III.Pledge of Allegiance IV.Approval of Meeting Agenda V.Community Comment During "Community Comment," the Edina Housing and Redevelopment Authority (HRA) will invite residents to share new issues or concerns that haven't been considered in the past 30 days by the HRA or which aren't slated for future consideration. Individuals must limit their comments to three minutes. The Chair may limit the number of speakers on the same issue in the interest of time and topic. Generally speaking, items that are elsewhere on today's agenda may not be addressed during Community Comment. Individuals should not expect the Chair or Commissioners to respond to their comments today. Instead the Commissioners might refer the matter to sta. for consideration at a future meeting. VI.Adoption of Consent Agenda All agenda items listed on the consent agenda are considered routine and will be enacted by one motion. There will be no separate discussion of such items unless requested to be removed from the Consent Agenda by a Commissioner of the HRA. In such cases the item will be removed from the Consent Agenda and considered immediately following the adoption of the Consent Agenda. (Favorable rollcall vote of majority of Commissioners present to approve.) A.Draft Minutes of Regular Meeting December 10, 2020 B.Draft Minutes of Regular Meeting December 17, 2020 C.Edina Housing Foundation Appointments D.Resolution No. 2021-01: Designating O9cial Newspaper E.Resolution No. 2021-02: Designating O9cial Depositories VII.Reports/Recommendations: (Favorable vote of majority of Commissioners present to approve except where noted) A.Election of O9cers B.Appointment of the Executive Director of the HRA C.Memorandum of Understanding pertaining to redevelopment of 5146 Eden Ave VIII.Correspondence A.Correspondence IX.HRA Commissioners' Comments X.Executive Director's Comments A.Year in Review - 2020 B.By-Law Review XI.Adjournment The Edina Housing and Redevelopment Authority wants all participants to be comfortable being part of the public process. If you need assistance in the way of hearing ampliBcation, an interpreter, large-print documents or something else, please call 952-927-8861 72 hours in advance of the meeting. Date: January 28, 2021 Agenda Item #: VI.A. To:Chair & Commissioners of the Edina HRA Item Type: Minutes From:Liz Olson, Administrative Support Specialist Item Activity: Subject:Draft Minutes of Regular Meeting December 10, 2020 Action Edina Housing and Redevelopment Authority Established 1974 CITY OF EDINA HOUSING & REDEVELOPMENT AUTHORITY 4801 West 50th Street Edina, MN 55424 www.edinamn.gov ACTION REQUESTED: INTRODUCTION: ATTACHMENTS: Description Minutes December 10, 2020 Page 1 MINUTES OF THE REGULAR MEETING OF THE EDINA HOUSING AND REDEVELOPMENT AUTHORITY DECEMBER 10, 2020 7:30 A.M. I. CALL TO ORDER Chair Hovland called the meeting to order at 7:30 a.m. and noted the meeting was being held virtually to comply with the Governor’s Stay at Home Order due to the COVID-19 pandemic then explained the processes created for public comment. II. ROLLCALL Answering rollcall were Commissioners Anderson, Brindle, Fischer, Staunton, and Chair Hovland. Absent: None. III. PLEDGE OF ALLEGIANCE IV. MEETING AGENDA APPROVED - AS PRESENTED Motion by Commissioner Brindle, seconded by Commissioner Fischer, approving the meeting agenda as presented. Roll call: Ayes: Anderson, Brindle, Fischer, Staunton, and Hovland Motion carried. V. COMMUNITY COMMENT No one appeared. VI. CONSENT AGENDA ADOPTED AS PRESENTED Member Brindle made a motion, seconded by Member Fischer, approving the consent agenda as presented: VI.A. Approve minutes of the Regular Meeting of November 12, 2020 VI.B. Approve 2021 Calendar of Meeting Dates VI.C. Approval and Authorization of Closing Documents for The Sound on 76th VI.D. Update to New Multi-Family Affordable Housing VI.E. Approve payment claims for Check Register Claims of HRA Check Register September 18-December 4, 2020, totaling $187,272.13 Rollcall: Ayes: Anderson, Brindle, Fischer, Staunton, Hovland Motion carried. VII. REPORTS/RECOMMENDATIONS VII.A. ACCEPT THE HOUSING STRATEGY TASK FORCE REPORT – ADOPTED Affordable Housing Development Manager Hawkinson said the Housing Strategy Task Force had been meeting over 18 months to develop Goals and Strategies to address the housing needs in Edina. She said the report was a culmination of 45 meetings and a compromise that included the preservation of R1 zoning for single-family houses and recognized the need for more multi-family housing production to accommodate growth. Ms. Hawkinson said the report was not prescriptive but a document to guide housing priorities in the City and to suggest strategies to achieve specific goals. She said the hope was the report would encourage the City to proactively enable, support and facilitate quality housing development that met the evolving needs and thanked the Task Force for their work to create this report. Minutes/HRA/December 10, 2020 Page 2 Housing Strategy Task Force Co-Chair Hunt thanked the members of the Task Force for the culmination of debates that resulted in this report. Housing Strategy Task Force Member Brown shared the executive summary that outlined how housing had changed in Edina and appeared on course to continue or outpace growth. He spoke about limited ability to collect input due to the pandemic and civil unrest then community drivers that included quality of life, goals and strategies that promoted life cycle housing, amended land use regulations to enable a more diverse housing mix, reduced building costs, and encourage sustainable design and technology. They reviewed five housing priorities that included the creation of 992 new affordable housing units, 900 new market rate rental housing units, 360 new senior independent living units, 250 new multi-family units, and 200 new senior assisted units then outlined recommended next steps. They thanked Members Brindle and Fischer for their years of service to the City and Ms. Hawkinson for her work on this project. The Commission thanked Task Force members for the comprehensive report and commented about the level of dedication to this project and need for focus then asked about potential racial covenants and steps to remove. Ms. Hawkinson explained how the Task Force did not want to negate history but that racial covenants still existed on titles and outlined the work by the Human Rights and Relations Commission to remove. City Attorney Kendall added this work would be a process and while the City would assist to remove them from property titles the covenants were unenforceable. The Commission spoke about the importance of the missing middle and referred to the Edina Housing Foundation’s work to balance high land cost in the City and not compromising materials in order to lower housing costs. They inquired about the report that referred to a matter of personal opinion regarding exclusionary housing policy and whether active zoning should be implemented and commented about not downsizing but more of rightsizing. The Commission spoke about current challenges with the MN Builders Association and the ongoing debate about permitting costs that increase housing costs and suggested the report be received with direction to create an implementation plan for formal consideration. Co-Chair Hunt responded to the building and land costs discussion and said there was a need for balance between increased requirements and the City’s high standards to ensure affordability. The Commission agreed that as policy makers there has to be standards in place as well as appropriate price points and thanked the Task Force for their great work. Motion by Commissioner Staunton, seconded by Commission Fischer, to adopt the Housing Strategy Task Force Report and direct staff to create an implementation plan for formal consideration. Roll call: Ayes: Anderson, Brindle, Fischer, Staunton, and Hovland Motion carried. VII.B. ACCEPT THE AFFORDABLE HOUSING POLICY COMPLIANCE REPORT – RECEIVED Ms. Hawkinson said the Affordable Housing Policy for new multifamily residential developments had been in place since 2015 with the intent to ensure that affordable units would be included in market rate developments and rented to income qualified tenants. The affordable units would remain affordable for a predetermined period of time, which for some was 15 years and for new developments was 20 years. She shared that Affordable Housing Connections (AHC) was hired as a compliance consultant to confirm and verify the affordable units were affordable and rented to income eligible tenants then reviewed the requirements in detail to ensure affordable housing occurred. Ms. Hawkinson reported that after review with Avidor, Aurora, Aria, and Nolan Mains and based on the areas of compliance that included income eligible tenants and affordable rent levels, Minutes/HRA/December 10, 2020 Page 3 only The Aurora was in compliance as presented in AHC's first compliance report. She summarized that staff and AHC believed all owners and property managers had every intention of compliance but that compliance could not be confirmed at this time. She added early agreements were not prescriptive and while the Policy Guide was provided to managers the four developments not in compliance were approved prior to the Guide’s creation and that work was still needed to achieve compliance. The Commission asked how the Guide applied to the earlier developments and how while the development agreement was the controlling document for compliance language could be considered vague with regard to garage rent and utilities and how the four earlier projects should be treated differently to adjust and hopefully achieve compliance. Ms. Hawkinson explained most direction was outlined by resolution but that property owners had agreed to begin offering affordable units until 2035 or a certificate of occupancy was received and while the City had no formal recourse staff would work to address separately. Mr. Neal outlined the goal of generally accepted terms and how everyone was working to meet the Commission’s commitments to affordable housing. The Commission reiterated the goal was to provide affordable units within balance. Motion by Commissioner Brindle, seconded by Commission Anderson, to receive the Affordable Housing Policy Compliance Report. Roll call: Ayes: Anderson, Brindle, Fischer, Staunton, and Hovland Motion carried. VIII. CORRESPONDENCE – Received IX. HRA COMMISSIONERS’ COMMENTS – Received X. EXECUTIVE DIRECTOR’S COMMENTS – Received XI. ADJOURNMENT Motion made by Commissioner Brindle, seconded by Commissioner Fischer, to adjourn the meeting at 8:47 a.m. Roll call: Ayes: Anderson, Brindle, Fischer, Staunton, and Hovland Motion carried. Respectfully submitted, Scott Neal, Executive Director Date: January 28, 2021 Agenda Item #: VI.B. To:Chair & Commissioners of the Edina HRA Item Type: Minutes From:Liz Olson, Administrative Support Specialist Item Activity: Subject:Draft Minutes of Regular Meeting December 17, 2020 Action Edina Housing and Redevelopment Authority Established 1974 CITY OF EDINA HOUSING & REDEVELOPMENT AUTHORITY 4801 West 50th Street Edina, MN 55424 www.edinamn.gov ACTION REQUESTED: INTRODUCTION: ATTACHMENTS: Description Minutes December 17, 2020 Page 1 MINUTES OF THE REGULAR MEETING OF THE EDINA HOUSING AND REDEVELOPMENT AUTHORITY DECEMBER 17, 2020 7:30 A.M. I. CALL TO ORDER Chair Hovland called the meeting to order at 7:30 a.m. and noted the meeting was being held virtually to comply with the Governor’s Stay at Home Order due to the COVID-19 pandemic then explained the processes created for public comment. II. ROLLCALL Answering rollcall were Commissioners Anderson, Brindle, Fischer, Staunton, and Chair Hovland. Absent: None. III. PLEDGE OF ALLEGIANCE IV. MEETING AGENDA APPROVED - AS PRESENTED Motion by Commissioner Fischer, seconded by Commissioner Anderson, approving the meeting agenda as presented. Roll call: Ayes: Anderson, Brindle, Fischer, Staunton, and Hovland Motion carried. V. COMMUNITY COMMENT No one appeared. VI. CONSENT AGENDA ADOPTED AS PRESENTED Member Staunton made a motion, seconded by Member Brindle, approving the consent agenda as presented: VI.A. Approve minutes of the Regular Meeting of December 1, 2020 Rollcall: Ayes: Anderson, Brindle, Fischer, Staunton, Hovland Motion carried. VII. REPORTS/RECOMMENDATIONS VII.A. APPROVE PUBLIC IMPROVEMENTS ASSOCIATED WITH THE GRANDVIEW 2 TIF DISTRICT AND REQUEST FOR PURCHASE FOR CONSULTING SERVICES - APPROVED Director of Engineering Millner said the HRA was asked to approve public improvements associated with the Grandview 2 TIF District and request for purchase for consulting contracts with SEH, Barr Engineering, and Kimley Horn. He summarized the decision for funding that must be committed by June 2021 then recommended a slate of improvements totaling $5.3 million that included public improvements on Eden Avenue/Brookside Avenue, Grandview parking ramp, Eden Avenue and Arcadia intersection. He outlined more details regarding the traffic study for Eden Avenue that included closure of southbound Highway 100 ramp, testing the closure in spring 2021, then reviewed options with and without the closure and pedestrian improvements. Mr. Millner reviewed options for the Grandview ramp in detail that included possible slip ramps and others not feasible then spoke about the pedestrian crossings and the northeast corner of the parking ramp. He reviewed the estimated costs for the recommended public improvements and said staff recommended the HRA approve the improvements and request for purchase with the consultants for final design, bidding, and construction with discussion regarding the Yancy dedication in roundabout if approved. Minutes/HRA/December 17, 2020 Page 2 The Commission asked questions regarding available TIF funding and if funds could be used for these improvements, requested greater detail on the Grandview Road improvements and pedestrian crossing at Eden Avenue, confirmed the repositioning of the ramp on southbound 100, then spoke about pedestrians on Eden Avenue and concerns about crossing and the need for a shared, multi- use trail. Mr. Neuendorf explained staff had engaged Ehlers & Associates to provide financial projections for this district and concluded the district would create a good amount of revenue for 10 years of increment for $5.3 million debt or could close the district early and place the property back on tax rolls. Mr. Millner responded a multi-use trail had been included in the Transportation Plan since 2016 to help reduce speed impacts for pedestrians. The Commission asked questions regarding movement from Gus Young Lane and its necessity then spoke about the need for traffic counts in this heavily-used area. They inquired about repositioning the slip lane around the sound wall and suggested this area be used to celebrate the Yancy family legacy. They stressed the need for more streets to create grids and create a new east/west street to build a street network with the long-term plan to elevate the frontage road and how the work done now would result in short term safety changes with long term improved traffic movements, then asked about the potential for a future rail line utility. Mr. Millner explained a right turn lane would be created in the grass area to go onto Vernon Avenue that would capture the natural area for landscaping enhancements. Executive Director Neal explained this approval would not compromise TIF funding regarding the former Public Works site nor compromise TIF flow from that development then explained how the Dan Patch Line had much discussion on how to redevelop into a commuter-type line and while there were no plans in place in the near future they wanted to preserve the area as an opportunity. Commissioner-Elect Pierce asked questions regarding Vernon Avenue and slip ramp removal where pedestrian traffic would flow and potential improvements at Eden and Vernon for pedestrian safety. Mr. Millner explained a controlled intersection would be part of the Avidor project and include painted crosswalks and flashers and ways to address potential sight line issues due to the hill. Motion by Commissioner Fischer, seconded by Commission Staunton, approve public improvements associated with the Grandview 2 TIF District as presented and approve Request for Purchase; awarding the bid to the recommended low bidder, to SEH, Barr Engineering, and Kimley Horn in the total amount of $655,000. Roll call: Ayes: Anderson, Brindle, Fischer, Staunton, and Hovland Motion carried. VII.B. RE-USE AND REDEVELOPMENT OF 5146 EDEN AVENUE - RECEIVED Economic Development Manager Neuendorf stated previously this year staff updated the HRA Board on the status of this vacant site and recommended action be taken in 2021 to redevelop and reuse the property. He reviewed background details of the site that included several years of community input and the recommendation that a portion of the site be retained for future fire department use and establish a process to select a buyer for the remainder. He said a few developers had expressed interest in the site and while there was no binding commitment after selection as a potential partner, Frauenshuh Commercial Real Estate and United Properties had proposed to construct two new buildings on the property to develop a multi-phase, mixed used project. He shared about two pending studies in progress that identified this site as a site for future fire station #3 in 5-10 years then explained the proposed use for ownership and rental senior and family housing units for low to moderate incomes. Minutes/HRA/December 17, 2020 Page 3 Dave Anderson and Dean Williamson, Frauenshuh and Bill Katter and Alex Hall, United Properties/Pope Architects introduced their team then presented their preliminary concept for the site. They provided the collaborative development process and proposed concept that included outgrowth of learnings and discussions regarding the City’s objectives for the Grandview redevelopment. They discussed next steps that included timelines and HRA project objectives of both public and private use that the HRA concluded was cost prohibitive then explained the development concept that included owner-occupied senior cooperatives of market need and demand, medical office/health and wellness, and civic elements that would create a project of moderate scale and density, low traffic generator, enhanced walkability and connectivity, infrastructure enhancements and sustainability. The team explained the senior cooperatives in greater detail and shared data the demand for this housing type and medical office/health and wellness component to provide a connection for the two uses. They reviewed civic elements that included plaza green and a woonerf/pedestrian way then reviewed the development plan components. The Commission asked questions if the proposal included full senior coop or a combination of mixed income/market rate and reasons for the proposed lower height. The team explained underlying HUD financing required age restriction but still allowed affordable units in the mix and said the height was selected as it allowed for lower construction costs to help achieve affordability and ensure the priority of possible passenger rail in the future. They explained more about the medical office use and where the public space was proposed and that all plans included the City’s seven guiding principles including multi-modal transportation. Commissioner-Elect Jackson asked questions about the process for public transportation station and the proposed fire station and supported the senior coop idea. Commissioner-Elect Pierce supported the proposal in term of usage and stressed the need to add more ownership opportunities. The Commission spoke about the importance of including potential rail and that the uses made sense and how the partner had strong ties to the community already. They discussed the TIF deadline of June 2021 and the likelihood of not being able to use those funds at this time then shared their support of age-restricted ownership options as this was an underserved area of need and shared their consensus to partner with Frauenshuh/United Properties on a project that included a possible fire station, rail access, public use, and potential private development either in public/private partnership or through land sale. VIII. CORRESPONDENCE – Received IX. HRA COMMISSIONERS’ COMMENTS – Received X. EXECUTIVE DIRECTOR’S COMMENTS – Received XI. ADJOURNMENT Motion made by Commissioner Fischer, seconded by Commissioner Brindle, to adjourn the meeting at 9:37 a.m. Roll call: Ayes: Anderson, Brindle, Fischer, Staunton, and Hovland Motion carried. Respectfully submitted, Scott Neal, Executive Director Date: January 28, 2021 Agenda Item #: VI.C. To:Chair & Commissioners of the Edina HRA Item Type: Report / Recommendation From:MJ Lamon, Community Engagement Coordinator Item Activity: Subject:Edina Housing Foundation Appointments Action Edina Housing and Redevelopment Authority Established 1974 CITY OF EDINA HOUSING & REDEVELOPMENT AUTHORITY 4801 West 50th Street Edina, MN 55424 www.edinamn.gov ACTION REQUESTED: Appoint Bernadette Hornig, Mary Kay McNee, and Ann Swenson to the Edina Housing Foundation with a term ending 3/1/22. INTRODUCTION: The Edina Housing Foundation consists of five members. Per the Foundations by-laws, members shall be appointed each year. Two members are appointed by City Council and three are appointed by HRA. T he HRA is being asked to appoint Bernadette Hornig, Mary Kay McNee, and Ann Swenson. Date: January 28, 2021 Agenda Item #: VI.D. To:Chair & Commissioners of the Edina HRA Item Type: Report / Recommendation From:Liz Olson, Administrative Support Specialist Item Activity: Subject:Resolution No. 2021-01: Designating Official Newspaper Action Edina Housing and Redevelopment Authority Established 1974 CITY OF EDINA HOUSING & REDEVELOPMENT AUTHORITY 4801 West 50th Street Edina, MN 55424 www.edinamn.gov ACTION REQUESTED: Adopt Resolution No. 2021-01 designating the Edina Sun-Current as the official newspaper for the Housing and Redevelopment Authority (HRA) for 2021. INTRODUCTION: Staff recommends Council designate the Edina Sun Current as the official newspaper of the HRA for 2021. The Sun-Current rates for public notices for 2021 is the same as 2020. All published public notices are posted on the Sun-Current's website www.current.mnsun.com, at no additional charge. ATTACHMENTS: Description Resolution No. 2021-01: Designating Official Newspaper RESOLUTION NO. 2021-01 DESIGNATING OFFICIAL NEWSPAPER BE IT RESOLVED by the Edina Housing & Redevelopment Authority of the City of Edina, Minnesota, that the Edina Sun-Current is hereby designated as the Official Newspaper for the Edina Housing & Redevelopment Authority for the year 2021. Passed and adopted this 28th day of January 2021. Attest: TDB, Secretary James B. Hovland, Chair STATE OF MINNESOTA ) COUNTY OF HENNEPIN ) SS CITY OF EDINA ) CERTIFICATE OF EXECUTIVE DIRECTOR I, the undersigned duly appointed and acting Executive Director for the Edina Housing & Redevelopment Authority do hereby certify that the attached and foregoing Resolution was duly adopted by the Edina Housing & Redevelopment Authority at its Regular Meeting of January 28, 2021, and as recorded in the Minutes of said Regular Meeting. WITNESS my hand and seal of said City this ______________ day of ___________________, ____________. Executive Director Date: January 28, 2021 Agenda Item #: VI.E. To:Chair & Commissioners of the Edina HRA Item Type: Report / Recommendation From:Liz Olson, Administrative Support Specialist Item Activity: Subject:Resolution No. 2021-02: Designating Official Depositories Action Edina Housing and Redevelopment Authority Established 1974 CITY OF EDINA HOUSING & REDEVELOPMENT AUTHORITY 4801 West 50th Street Edina, MN 55424 www.edinamn.gov ACTION REQUESTED: Adopt Resolution No. 2021-02 designating official depositories for the Housing and Redevelopment Authority (HRA) for 2021. INTRODUCTION: See Resolution No. 2021-02 designating official depositories for 2021. ATTACHMENTS: Description Resolution No. 2021-02: Designating Official Depositories RESOLUTION NO. 2021-02 DESIGNATING OFFICIAL DEPOSITORIES BE IT RESOLVED, that U.S. Bank, Crown Bank and Tradition Capital Bank, are hereby authorized to do banking business in Minnesota, be and are hereby designated as Official Depositories for the Public Funds of the Edina Housing and Redevelopment Authority, City of Edina, County of Hennepin, Minnesota until January 1, 2022. Dated: January 28, 2021 Attest: TBD, Secretary James B. Hovland, Chair STATE OF MINNESOTA ) COUNTY OF HENNEPIN ) SS CITY OF EDINA ) CERTIFICATE OF EXECUTIVE DIRECTOR I, the undersigned duly appointed and acting Executive Director for the Edina Housing and Redevelopment Authority do hereby certify that the attached and foregoing Resolution was duly adopted by the Edina Housing and Redevelopment Authority at its Regular Meeting of January 28, 2021, and as recorded in the Minutes of said Regular Meeting. WITNESS my hand and seal of said City this ______________ day of ___________________, ____________. Executive Director Date: January 28, 2021 Agenda Item #: VII.A. To:Chair & Commissioners of the Edina HRA Item Type: Report / Recommendation From:Scott H. Neal, City Manager Item Activity: Subject:Election of Officers Action Edina Housing and Redevelopment Authority Established 1974 CITY OF EDINA HOUSING & REDEVELOPMENT AUTHORITY 4801 West 50th Street Edina, MN 55424 www.edinamn.gov ACTION REQUESTED: Motion appointing Chair, Vice Chair and Secretary of the HRA. INTRODUCTION: The by-laws of the HRA provide for the designation of officers. The Chair presides at the meetings and executes all contracts. T he Vice Chair steps in during times when the Chair is unavailable. The Secretary co-signs all contracts. Date: January 28, 2021 Agenda Item #: VII.B. To:Chair & Commissioners of the Edina HRA Item Type: Report / Recommendation From:Scott H. Neal, City Manager Item Activity: Subject:Appointment of the Executive Director of the HRA Action Edina Housing and Redevelopment Authority Established 1974 CITY OF EDINA HOUSING & REDEVELOPMENT AUTHORITY 4801 West 50th Street Edina, MN 55424 www.edinamn.gov ACTION REQUESTED: Motion to appoint City Manager Scott Neal as Executive Director of the HRA. INTRODUCTION: The City Council previously designated me as Executive Director of the HRA. I request the Council affirm this designation with the requested motion. The proposed term of this appointment will be concurrent with my employment as City Manager. Date: January 28, 2021 Agenda Item #: VII.C. To:Chair & Commissioners of the Edina HRA Item Type: Report / Recommendation From:Bill Neuendorf, Economic Development Manager Item Activity: Subject:Memorandum of Understanding pertaining to redevelopment of 5146 Eden Ave Action Edina Housing and Redevelopment Authority Established 1974 CITY OF EDINA HOUSING & REDEVELOPMENT AUTHORITY 4801 West 50th Street Edina, MN 55424 www.edinamn.gov ACTION REQUESTED: Approve the Memorandum of Understanding with Frauenshuh Commercial Real Estate and United Properties. INTRODUCTION: This item pertains to the potential re-use and redevelopment of vacant land owned by the Housing & Redevelopment Authority located at 5146 Eden Avenue. The re-use of this site has been discussed for many years. Potential ideas have been pursued since 2008. None of those previous concepts was able to move forward. A Memorandum of Understanding has been prepared by the City Attorney to establish a temporary working arrangement with Frauenshuh and United Properties. Staff recommends approval of this Memorandum of Understanding. ATTACHMENTS: Description Staff Report Memorandum of Understanding 5146 Eden Ave Housing & Redevelopment Authority January 28, 2021 Chair Hovland and Commissioners of the Edina Housing and Redevelopment Authority Bill Neuendorf Memorandum of Understanding pertaining to the redevelopment of 5146 Eden Avenue Information / Background: The Housing and Redevelopment Authority owns a 3.3-acre parcel located at 5146 Eden Avenue. This site was originally developed as a concrete factory and was most recently used by the Edina Public Works Department. The site has been exempt from property taxes since 1962. It has been vacant since 2013. In recent years, several different concepts have been explored to redevelop the site and return it to productive use. Concepts included: all public uses, all private uses and multiple combinations of public and private uses. None of these concepts was able to be implemented. Two local development companies intend to partner to bring together a proposal that successfully redevelops the site. This effort will be led by Frauenshuh Commercial Real Estate. Frauenshuh was selected by the HRA after a competitive search in 2016. United Properties will partner with Frauenshuh to develop a senior housing cooperative on part of the property. United Properties and the City of Edina previously worked together to redevelop the gravel pits into Centennial Lakes Park. Based on feedback provided by the Commissioners in December 2020, staff has worked with the developers and the City Attorney to prepare an agreement that establishes a temporary working relationship. This agreement defines the general expectations of the developers and the HRA. It grants a temporary exclusive right to the developers to prepare an updated concept plan to deliver four key elements: • New commercial building on the south • New for-sale housing (preferably cooperative) on the north • New public plaza in the center • New pedestrian bridge over the railroad tracks with future access to the railroad tracks STAFF REPORT Page 2 The agreement also clarifies that the HRA does not expect a new publicly-owned facility at this location nor a Metro Transit park-n-ride. City staff will work with the developers and their design team to identify conditions that must be addressed in their concept. Some conditions are anticipated to include: widening of Arcadia Ave., inclusion of affordable housing, and shared use of parking lot when not needed by the commercial business. Other conditions will be explored and shared with the developers as they prepare the concept. In keeping with the spirit of the 7 Guiding Principles and Grandview District Framework, the agreement also clarifies that the goal of the HRA is not simply to maximize land value, but to redevelop the site in a way that creates the best practical projects while delivering fair value from the land. This agreement is intended to be the first step in the process to return the site to productive and beneficial use. If the HRA and Developers desire to move forward with the concept plan, additional steps will be taken to bring the concept to fruition. An overview of the key steps follow: Key Tasks Approx. Time Frame Step 1 MOU Explore concept plan Solicit input through Edina’s Sketch Plan Review process Identify methodology to establish land value Q1-Q2 2021 Step 2 Contract for Sale and Redevelopment Agreement Q2-Q3 2021 Step 3 Preliminary Rezoning and Site Plan Approval Q3-Q4 2021 Step 4 Financing and Transfer of Ownership Q1 2020 Step 5 Construction and Occupancy Q2-Q3 2021 Step 6 Occupancy 2022 - 2023 Recommended Action: The City Attorney has prepared the attached Memorandum of Understanding (MOU). Staff recommends that this MOU be approved. 213528v2 MEMORANDUM OF UNDERSTANDING 5146 EDEN AVENUE MEMORANDUM OF UNDERSTANDING (“MOU”) dated this __ day of _____________, 2021 (“Effective Date”), by and the Edina Housing and Redevelopment Authority, a public body corporate and politic under the laws of the State of Minnesota (the “HRA”) and Frauenshuh, Inc., a Minnesota corporation, d/b/a Frauenshuh Commercial Real Estate (“Frauenshuh”) and United Properties Development, LLC, a Minnesota limited liability company (“United”) (Frauenshuh and United are collectively referred to as the “Developer”). WHEREAS, the HRA owns and desires to promote redevelopment of certain property within the City located at 5146 Eden Avenue, Edina, MN 55436 (the “Property”) as depicted in Exhibit A attached hereto; WHEREAS, the Developer desires to explore the possibility of acquiring the Property for a multi-phased mixed-use development, consisting of four (4) mandatory elements, as follows: (i) a Commercial building on the southern portion of the Property; (ii) a Public green plaza in the central portion of the Property; (iii) a Multi-family ownership building on the northern portion of the Property; (iv) a pedestrian crossing bridge over the railroad tracks on the northern edge of the property with future access to railroad tracks at the southern or central portion of the Property; (collectively referred to as the “Proposed Development”); WHEREAS, Developer desires that the HRA work exclusively with Developer related to the redevelopment of the Property to provide Developer with time to study and explore redevelopment of the Property for the Proposed Development; WHEREAS, the HRA is willing to work solely with Developer for the time period provided in this MOU, subject to the conditions identified herein in order to (i) identify a market viable scenario to repurpose the Property for the Proposed Development and (ii) convey the Property at fair market value. NOW THEREFORE the parties agree as follows: 1. TERM. This MOU will commence upon the Effective Date and will terminate one-hundred twenty (120) days after the Effective Date (“Term”). Upon mutual agreement of the parties, the Term may be extended based on satisfactory progress or other considerations which may warrant such an extension. 213528v2 2 2. ASSUMPTIONS AND UNDERSTANDINGS. The parties agree on the following assumptions and understandings with respect to development of the Property and this MOU: a. The studies for development of the Property will include the four mandatory elements described above; b. There is no expectation of a new public building or Metro Transit park-n-ride as part of the Proposed Development of the Property; c. That the combination of elements making up the Proposed Development may not maximize the land value for the HRA, but the HRA places priority on delivering the best practical project following the 7 Guiding Principles, rather than simply maximizing the sale price of the Property. However, the HRA expects that a purchase price for the Property will be based on the fair market value for the approved level of development and mandatory elements of the Property; d. The use of tax increment financing or other public financing sources may be considered to support construction of affordable housing units and public infrastructure including but not limited to the pedestrian crossing bridge over the railroad tracks on the northern edge of the property; e. Rezoning as a planned unit development process may be necessary for the Proposed Development. f. Based on the City and HRA comments on the concept plans proposed under this MOU, the parties will be in a position to make an informed decision about the viability of the Developer’s concept for the Proposed Development and will inform the parties’ desire to consider preparation of appropriate agreements for the sale and development of the Property following termination of this MOU. g. This MOU is not intended to bind the parties to enter into any future agreement for the sale, acquisition or development of the Property, but is merely intended to set forth the parties’ intent to determine whether the parties desire to proceed with the process of negotiating an agreement for the sale and purchase and development of the Property following termination of the MOU. 3. DEVELOPER RESPONSIBILITIES. During the Term of this MOU, Developer agrees that it will: a. Conduct appropriate studies of the Property necessary for determining the feasibility of the Proposed Development of the Property, including: a review of existing site conditions, past studies, relevant codes and guidelines, and market conditions to support the preparation of conceptual plans to redevelop the Property; 213528v2 3 b. Submit conceptual plans to the HRA for review and comment; c. Submit conceptual plans to the City of Edina for review using the City’s standard process for sketch plan reviews, which will then be reviewed by the City of Edina staff, Planning Commission and City Council pursuant to the sketch plan review process. d. Present and obtain feedback from stakeholders and other interested community members, as identified by HRA/City staff; e. Submit the methodology for Developer’s determination of a purchase offer price for HRA consideration and approval. 4. HRA RESPONSIBILITIES. During the term of this MOU, the HRA agrees that it will: a. Work exclusively with Developer on the study and review of the development of the Property with the intent of identifying the viability of the Proposed Development and identifying a proposed sale price of the Property; b. Identify essential criteria applicable to the development of the Property, including roadway and utility right-of-way needs and public access needs for pedestrians and other non- motorized traffic as well as other preferred criteria to be considered as the Developer prepares concept plans; c. HRA consideration and approval of the methodology for Developer’s determination of a purchase price offer within sixty (60) days after the Effective Date; d. Share existing studies or other information pertinent to the site, upon request of the Developer including: (i) Most recently available ALTA Survey with all Table A checklist requirements; (ii) Most recently available site geotechnical report; (iii) Most recently available Environmental Assessment report(s); (iv) Updated Title Commitment; (v) Copies of any unrecorded easements. leases, licenses and other agreements for use or rights that encumber the Property. 5. CONDITIONS. Developer agrees to the following conditions: a. The Developer’s conceptual plans for the Property will be responsive to and to the greatest extent feasible, consistent with: 213528v2 4 (i) the City’s Grandview Framework Plan; (ii) the City of Edina Comprehensive Plan; (iii) other applicable guide plans, including the 2016 Grandview Transportation Plan and the 2018 Grandview Stormwater Guide; b. Any and all costs associated with the studies, preparation of concept plans, attendance at meetings and other costs and expenses incurred by Developer in performing the obligations of this MOU shall be the sole responsibility of the Developer; c. The HRA’s sole costs incurred in connection with this MOU will be limited to the cost of the HRA’s internal staff time that is not typically required to be paid by developers as part of the sketch plan review process; d. During the term of this MOU, the Developer will only communicate with HRA/City staff regarding issues pertinent to the Property. Except for presentations and discussions at public meetings, Developer will not communicate in any way with elected or appointed City or HRA officials regarding issues pertaining to this Property. 6. AMENDMENT. This MOU may be amended by mutual written agreement of the parties. 7. TERMINATION. This MOU may be immediately terminated by a party upon violation of the obligation or conditions of the MOU by another party to the MOU. IN WITNESS WHEREOF, the parties have caused this Memorandum of Understanding to be duly executed as of the date and year first above written. EDINA HOUSING AND REDEVELOPMENT AUTHORITY BY:________________________________ James Hovland, Its Chair AND:________________________________ ___________________, Its Secretary 213528v2 5 DEVELOPER: FRAUENSHUH, INC. dba FRAUENSHUH COMMERCIAL REAL ESTATE BY:________________________________ Its:___________________ UNITED PROPERTIES DEVELOPMENT, LLC BY:________________________________ Its:___________________ 213528v2 6 EXHIBIT A DEPICTION OF PROPERTY PID: 2811721310014 PID: 2811721310015 PID: 2811721310016 Date: January 28, 2021 Agenda Item #: VIII.A. To:Chair & Commissioners of the Edina HRA Item Type: Other From:Liz Olson, Administrative Support Specialist Item Activity: Subject:Correspondence Information Edina Housing and Redevelopment Authority Established 1974 CITY OF EDINA HOUSING & REDEVELOPMENT AUTHORITY 4801 West 50th Street Edina, MN 55424 www.edinamn.gov ACTION REQUESTED: None. INTRODUCTION: There has been no correspondence since the last meeting. Date: January 28, 2021 Agenda Item #: IX.A. To:Chair & Commissioners of the Edina HRA Item Type: Report / Recommendation From:Bill Neuendorf, Economic Development Manager Item Activity: Subject:Year in Review - 2020 Information Edina Housing and Redevelopment Authority Established 1974 CITY OF EDINA HOUSING & REDEVELOPMENT AUTHORITY 4801 West 50th Street Edina, MN 55424 www.edinamn.gov ACTION REQUESTED: Accept the staff report. INTRODUCTION: Each year, staff provides a summary of relevant activities that have been completed, in progress and pending. The report for 2020 has been prepared. Staff is available to answer questions about the content. While no decision-making is involved in this report, staff recommends that the report be accepted for the record. ATTACHMENTS: Description Year in Review 2020 HOUSING AND REDEVELOPMENT AUTHORITY 2020 - YEAR IN REVIEW OVERVIEW The Edina Housing and Redevelopment Authority (HRA) was established in 1974 for the purpose of undertaking urban redevelopment projects and assisting with the development of affordable housing. The members of the Edina City Council serve as Commissions of the Board of the HRA. The Edina City Manager serves as Executive Director of the HRA. From time to time, additional services are provided to the HRA by City staff as part of their regular job duties. The HRA also uses third-party professionals to provide expertise in the preparation of redevelopment agreements and to provide monitoring and reporting oversight. This report has been prepared by City of Edina staff to highlight activities and accomplishments in the past year. This report also contains updated project information that may shape upcoming activities and programs of the HRA. 2020 ACCOMPLISHMENTS • Completed redevelopment at 4500 France Ave. – the Lorient Apartments and received public easements on 40 new parking stalls and a new public plaza • Established Small Business Emergency Assistance Program and issued 11 forgivable loans and 41 grants to local small businesses to help counter the economic impacts of the COVID-19 pandemic • Established Emergency Rental Assistance Program and awarded $200,000 in rental assistance to Edina households in 2020 • Worked with the Edina Housing Foundation and MWF Properties to break ground on new affordable housing at 7075-7079 Amundson Avenue • Prepared documents to sell property to Aeon for new affordable housing at 4100 West 76th St • Closed on thirteen (13) “Come Home 2 Edina” second mortgages • Provided funding to the Edina Housing Foundation to acquire 4040 West 70th Street to be redeveloped into permanently affordable senior housing • Implemented the Class 4d Property Tax Reduction for naturally occurring affordable multifamily housing to one building, preserving 23 affordable units for 2-years 2020 Edina HRA – Year in Review Page 2 REDEVELOPMENT ACTIVITY The global pandemic impacted redevelopment and economic conditions in Edina. Most projects that had already received financing or broken ground continued to move forward. Unfortunately, some projects were delayed and some may not recover. In 2020, many businesses located throughout Edina experienced unprecedented impacts due to the pandemic that was officially recognized in mid-March. In order to limit the spread of the virus, many businesses were affected by government mandated closures and temporary occupancy limits. Other businesses were impacted by rapidly changing consumer behavior, with some customers not willing to patronize businesses in person due to concern of virus spread. While some businesses (like grocery stores and hardware stores) prospered, the majority of other businesses struggled. Despite these conditions, developers and investors continued to be interested in in under-performing commercial and industrial sites in Edina. Most redevelopment occurs on properties that were originally developed 50 or more years ago. The aging structures on these properties typically has not kept pace with the needs or expectations of the current marketplace. Most redevelopment in Edina is privately funded. The HRA does get involved in project financing when the project is determined to be unfeasible without intervention and when the proposed project delivers long-term community benefits. Most of the 60 major redevelopment projects constructed since the recovery from the Great Recession have been privately funded. Only nine projects have utilized tax increment financing (TIF) from Edina. Four of these nine projects were developed by the Edina HRA or not-for-profit affordable housing developers. As of year-end 2020, Edina has nine active TIF districts. No new TIF Districts were established this year. Key details of Edina’s TIF districts are summarized below: Name Type Size (acres) Year Established First Collection Expiration Year 44th and France 2 Renewal, 15-years 1.0 2018 2021 2036 50th and France 2 Redevelopment, 25-years 2.8 2017 2020 2045 72nd and France Special Housing, 20-years 5.2 2019 2023 2043 Amundson Avenue Special Housing, 20-years 1.2 2019 2022 2042 Grandview 2 Redevelopment, 25-years 10.8 2016 2020 2045 Southdale 2 Economic Development, 8-years 208 2012 2013 2021 66 West Housing 0.9 2016 2019 2044 West 76th Street Special Housing, 20-years 2.0 2018 2022 2042 Pentagon Park Redevelopment, 25-years 47 2014 2018 2043 2020 Edina HRA – Year in Review Page 3 In general, Edina uses TIF to a lesser extent than neighboring communities. For property taxes paid in 2020, only 3.8% of the property tax base was included in a TIF District. This is an increase from 3.5% from the previous year. Based on preliminary estimates for 2021, this measure is likely to increase to 5% of the total property tax base. Maps and graphs to illustrate the use of TIF in Edina are attached as Exhibits A and B. More detailed information regarding each TIF District is contained in the Annual Report submitted to Minnesota’s Office of the State Auditor. Those reports are available upon request. INCREMENTAL PROPERTY TAX COLLECTIONS The incremental property tax is being collected in 5 of the 9 TIF Districts. This amount is calculated by Hennepin County. The amount collected in each District is summarized below. The 2020 estimates are based on the most recent information available from Hennepin County. It should be noted that these “incremental” taxes do not include the base taxes that are distributed to each of the taxing districts like the County, City and School Districts. Similarly, the amount shown below do not include other taxes paid by commercial and industrial property owners that are distributed to the State of Minnesota and contributed into the fiscal disparity pool that is shared with other municipalities in the metro region. TIF District Name & Number 2019 2020 Southdale 2 (#1208-1209-1210) $6,104,336 $5,751,287 Pentagon Park (#1211) $445,174 $380,452 Grandview 2 (#1212-1213) $77,768 $183,889 66 West (#1214) $610 $2,736 50th & France 2 (#1215) NA $59,476 44th & France 2 NA NA 72nd & France NA NA West 76th St NA NA Amundson NA NA Sources: MN OSA’s Annual Reports and Hennepin County Tax Increment Finance Settlement statements from December 2020 2020 Edina HRA – Year in Review Page 4 PROJECT STATUS 1) 4500 France Avenue – The Lorient Apartments The HRA entered into a Redevelopment Agreement in 2018 and pledged to issue a TIF note up to $2.295 million after successful completion of the $29 million redevelopment project. The project consists of approximately 46 apartments (of which three are affordable to households with incomes at or below 60 percent of AMI) with approximately 7,000 square feet of commercial space on the first floor. The new building is designed to be four stories near the commercial street and two stories along Sunnyside Road to make a smooth transition to the adjacent single-family houses. The project will also include several infrastructure improvements in the commercial node and will provide a public plaza, public parking, public art and new public sidewalks with streetscape improvements. The project received the Certificate of Occupancy on schedule in August 2020. Residents began to move into the building. Commercial leasing has been hampered by the pandemic and challenges finding appropriately sized businesses. Staff is working with the developer to compile and document compliance with the Redevelopment Agreement. It is anticipated that the TIF Certificate of Completion will be delivered in spring 2021. The first TIF payment is anticipated to occur in summer 2021. 2) 3940 Market Street – North Ramp This project was completed in Fall 2018 at a total estimated cost of $12 million. Real estate proceeds and monies from the Centennial Lakes TIF fund were used to fund the capital investment. The final project includes 546 public parking stalls as well as 10,000 square feet of commercial space. The commercial space was sold to a private developer in October 2019. After the commercial spaces were sold, the developer began interior construction for new businesses. The two spaces will be subdivided to accommodate four new tenants. Basecamp Fitness opened in February 2020 but has been hampered by the pandemic. They remain open subject to government- mandated operational limits. Soul Cycle began construction in January 2020, but paused on all new projects when the pandemic took hold. Their opening date is uncertain. An new tenant - the Bar Method – is on track to open in January 2021. 3) 3945 Market Street – Nolan Mains / Center Ramp This property was sold to a private developer in 2018 for construction of 100 units of rental housing, approximately 20,000 square feet of commercial space and reconstruction of the new Center Parking Ramp. The building is configured around a series of public walkways and plazas to create a vibrant pedestrian experience that engages the adjacent commercial properties. The project also includes shared trash rooms for use by adjacent businesses and extensive, utility improvements that benefit surrounding properties. 2020 Edina HRA – Year in Review Page 5 The HRA issued a $10.1 million TIF note that will begin to bear interest and be payable upon completion of the $74 million project. With the support of the Edina Housing Foundation, the HRA also provided a low-interest loan to support 10 affordable rental units in the facility for a period of at least 15 years. Residents began to occupy the building in November 2019. The development was determined to be substantially complete with the installation of final landscaping and street paving in spring 2020. Maintenance of the exterior common areas was turned over the to the City of Edina in early 2020. City staff have installed additional signage and created educational materials to help customers better understand how the new ‘shared street’ operates. Commercial leasing was hampered due to the pandemic. In fall 2020, five new businesses moved into some of the storefronts. The Lynhall Restaurant has become a popular destination, although its operations have been limited by the pandemic. Other retailers include: Flirt Boutique, Six for Good retail, Stranger & Co. retail and Hubert White menswear (holiday pop-up). Additional tenants are expected in 2021. The music and event programming anticipated for the public plaza was paused due to the pandemic. 4) 6112 – 6120 – 6128 – 6142 Kellogg Avenue – Edina Flats The HRA sold vacant property on Valley View Road and Kellogg Avenue to a private developer for construction of up to 18 new condominiums. The developer also owns vacant property at Valley View and Oaklawn. As of year-end 2020, all four buildings are substantially completed. The public plaza on the corner was completed in 2019. Ten (10) of the 15 units are sold or reserved for new residents. 5) 5146 Eden Avenue – former Public Works site The HRA continued to pause redevelopment planning on this vacant site throughout most of 2020. Staff recommends that redevelopment be pursued soon. Based on direction provided by the HRA Board members, staff is prepared to explore a proposal from Frauenshuh Company and United Properties in 2021. 6) Southdale Center Mall In 2019, two transformational projects were completed at the 77-acre Southdale Center Mall property. The RH Gallery furniture showroom remained operational throughout the pandemic. The Lifetime Athletic, Lifetime Sport and Lifetime Work facilities were temporarily closed but have reopened under occupancy limits to limit the spread of the virus. 2020 Edina HRA – Year in Review Page 6 The mall was temporarily closed due to the pandemic, but reopened mid-year. While some retailers closed, several new businesses opened for the holiday season. The former Herberger site (originally Donaldson’s) remains vacant since the department store was closed in late summer 2018. Due to the pandemic, the anticipated proposal for new housing, new library and new retail has been paused. Hennepin County has withdrawn their interest in the site and paused plans to rebuild the Southdale Regional Library. Simon Properties, the property owner continues to explore several possibilities for re-use or redevelopment of the Herberger site. A new concept is likely to be unveiled in 2021. 7) 6600-6800 France Avenue – Southdale Office Center While the property owner/developer secured land use approvals to add new retail, housing, hotel and office space on the site in 2016, the only element to be completed has been the new Bank of America. The property owner has determined that the original concept is not financially feasible, due in part to the high cost of structured parking and storm water requirements. They have indicated that the project cannot move forward without significant changes. In 2020, the property owner worked with McGough Development to prepare a new site plan that better addresses market conditions. The new proposal was submitted for rezoning consideration. Staff determined that the site is eligible for tax increment financing based on the age, layout and condition of the existing buildings. Unfortunately, city staff and Planning Commission did not find that the updated plan adequately met community goals for rezoning. The City Council supported that decision and the developer withdrew the proposal in January 2021. While it is likely that the property owner will return with a different proposal, the HRA should be prepared to consider public financial assistance (TIF) if the new project can deliver enhanced stormwater improvements as well as other public benefits. 8) 7001 France Avenue – US Bank site Ryan Companies and US Bank intend to redevelop the 5.7-acre site with a mixture of commercial and residential uses, including a modern facility for US Bank. At year end, the primary tenants have vacated the existing buildings with only the bank remaining. The developer received preliminary approval to rebuild the site by creating four separate parcels, each with a new building. Due to the high cost of construction and redevelopment, the developer indicates that public financing is necessary to move forward. A proposal for TIF financing is anticipated to be received in 2021. 2020 Edina HRA – Year in Review Page 7 9) 7200/7250 France Avenue In late 2018, the developer/property owner secured rezoning approval to replace two aging office buildings with two multi-family apartment buildings with commercial space on the street level. The approved site plan includes several public realm amenities and preserves a portion of the property that has a grove of mature trees. In April 2019, the City & HRA established the 72nd & France TIF District and entered into a Redevelopment Agreement with the developer. This agreement pledges $12 million in future TIF payments after successful completion of the project. The TIF pledge will reimburse the developer for eligible expenses associated with public benefits. The developer has not been able to secure private funding for the project. Lenders and investors indicate that the project is not financially feasible in the current format. At this point, the project is unlikely to move forward. The developer is reviewing options regarding how to proceed but there is no timetable for redevelopment 10) 3250 West 66th Street – Millennium of Southdale The first phase of this project began in 2019. It consists of 227 units of multi-family housing. The vacant building was demolished in summer and site work began soon after. At year-end the contractor has completed the framing and is busy enclosing the building and working on interior improvements. The project is anticipated to be completed in 2021. While this property is located within the Southdale 2 TIF District, this project was privately financed with no HRA participation. The owner has agreed to make seven of the units (3 percent) affordable. 11) 7001 York Avenue – Hennepin County facility Hennepin County owns and operates the Regional Library on this 8-acre property. For several years, they have been considering how to redevelop the property. The Service Center relocated to Southdale Center in 2015. The Court Facility moved to Ridgedale Center in Minnetonka in 2019. The Regional Library is scheduled to be relocated to the southeast quadrant of Southdale Center mall as early as 2022. The HRA may get involved in the future redevelopment of this site, possibly for the creation of new affordably priced housing in addition to other viable market-driven uses. In 2020, the County decided to pause its redevelopment plans while it reimages the timing and location for library services in this area. This delay is due to the pandemic. 12) 3650 Hazelton Road – Bowers Residences The City approved the zoning for a new high-rise residential building on this 1.25 acre site in 2019. This project is privately financed. The developer to broke ground in Spring 2020 At year end, the concrete frame is about 75% completed. Occupancy is anticipated in 2022. 2020 Edina HRA – Year in Review Page 8 13) 4040 West 70th Street The Edina Housing Foundation acquired this 1.58-acre site and conducted an RFQ process to select a developer to build affordable senior housing. The HRA provided a $3.65M loan to acquire the property. This loan can be forgiven if the Foundation enters into a 99-year ground lease instead of selling the property to the developer. This method assures long-term affordability. 14) 4100 West 76th Street – The Sound on 76 The HRA acquired the property in August 2019 and entered into a Purchase Agreement with Aeon with the intention to sell to Aeon after they have secured full construction funding for an affordable housing development. After a brief year-end delay, the HRA conveyed the property to Aeon in January 2021 and construction has commenced. 15) Pentagon Park South – Pentagon Village The HRA executed a Redevelopment Agreement with the developer to support complete redevelopment of the vacant 12-acre property. Upon completion, the developer will deliver completely new infrastructure and several new building elements. The new buildings are anticipated to include: new dual-brand Marriott hotel, two new retail buildings, Waterwalk extended-stay hotel, mixed-use retail/office building, two new office buildings, parking garage and public plaza. In recent years, the developer has made significant progress in pursuing complete redevelopment of the site. The infrastructure and retail buildings have been completed. Three TIF notes were issued in July 2019 with a total principal amount of $18.1 million. 2020 was a particularly challenging year for Pentagon Village. The COVID-19 pandemic delayed or de-railed the opening plans of several new businesses. Multiple restaurant operators had intended to occupy the new retail buildings. Due to the pandemic, only one of the restaurants opened. The developer was able to pivot and remodeled one of the buildings to accommodate a new co-working business that was seeking an additional site. Construction of the dual-branded hotel was also delayed, The hospitality industry was hard hit by the pandemic. This dramatically reduced both business and leisure travel. With occupancy rates unlikely to recover for several years, the hotel operator has not identified when the ground breaking will occur. Construction of the extended-stay hotel had been delayed prior to the pandemic but the weak outlook for the hospitality industry led the developer to investigate other options for the site. At this time, there are no firm plans. 2020 Edina HRA – Year in Review Page 9 Facing these challenges, the developer has amplified their marketing efforts for the site. They are actively seeking strong tenants to occupy the site and are seeking new partners for some of the delayed sites. These challenges have little impact on the HRA. Until milestones identified in the Redevelopment Agreement are achieved, the TIF Notes will not bear interest or be payable. 16) 7075 Amundson Avenue The HRA acquired 7075 Amundson from the Edina Housing Foundation at the asking price of $1.3M sold to MWF Properties for $600,000. This write-down helped fill a funding gap and allowed MWF to maximize points on their Low Income Housing Tax Credit application. Full funding was secured in early 2020. Construction began in early summer 2020. At year end, the structural framing is complete and the roof and windows are being installed. The project is on schedule to be delivered in Summer 2021. OTHER HRA ACTIVITIES 17) Small Business Emergency Assistance Program In response to the economic impact of the COVID-19 pandemic, the HRA created an Emergency Assistance Program to provide forgivable loans to small businesses suffering negative impacts. Eventually, two rounds of funding were made available. Both rounds focused on brick and mortar businesses with more than a single employee/owner. These types of businesses were prioritized because multiple business failures in Edina’s various business districts potentially threaten the ongoing viability and desirability of those districts and would damage the redevelopment efforts of the HRA. Other HRA programs and activities were put on hold in lieu of this unanticipated priority. Eleven (11) small businesses were provided $9,000 forgivable loans in the first round. The 11 businesses were competitively ranked by need, employment, and potential for success. All of those loans were forgiven in fall 2020 thanks to Edina’s allocation of federal CARES Act monies. The HRA was then reimbursed to keep the HRA’s budget whole. An additional forty one (41) small businesses were provided $10,000 grants in the second round of funding. This round also used part of Edina’s allocation of federal CARES Act monies. These 41 businesses were selected randomly from a pool of more than 50 eligible applicants. All funds were disbursed and all agreements were executed by the November 15, 2020 deadline. 2020 Edina HRA – Year in Review Page 10 18) Emergency Rental Assistance Program To protect residents faced with job loss or other hardship due to the COVID-19 pandemic, the HRA created an Emergency Rental Assistance Program. This program is operated by VEAP. Originally, the funding came from Edina’s Affordable Housing Trust Fund. Up to $500,000 was pledged. By the program deadline in November 2020, $200,000 in rental assistance had been provided to maintain people in their housing in Edina. When Edina’s funds were combined other resources, VEAP was able to serve 312 Edina households with emergency rental assistance. There are 300 Edina households on a waiting list for support when additional funds become available. Eventually, monies from the City’s allocation of federal CARES Act funding was use to reimburse the Trust Fund. 19) Open to Business Program The HRA continues to partner with the Metropolitan Consortium of Community Developers (MCCD) to provide free business consulting services for start-up businesses or expanding businesses located within Edina. These services are also provided to Edina residents regardless of where the business may eventually be located. The $5,000 annual contribution from the HRA supplements funding provided from Hennepin County. The implementation of this program was hindered by the pandemic and related closure of City Hall in 2020. MCCD staff shifted focus to support Hennepin County in delivering grants to more than 150 existing businesses in Edina. Additional detail of Open to Business services delivered are not available at this time. Staff recommends that Edina continue to participate in this program in 2021. 20) Come Home to Edina Program The Come Home 2 Edina program closed thirteen loans in 2020. Marketing efforts have been increased, especially to organizations that serve under-represented populations. The Edina Housing Foundation also launched a new program to assist existing homeowners who have been affected by the COVID-19 pandemic by providing second mortgages allowing the homeowner to reduce their first mortgage obligation and to assistance homeowners requiring mortgage forbearance. 21) Class 4d Property Tax Incentive HRA approved a pilot program for owners of naturally occurring affordable multifamily properties to reduce their property tax obligation by investing in energy efficient upgrades to the building and committing to keep units affordable for households with incomes at or below 60 percent of AMI for a period of time. 2020 Edina HRA – Year in Review Page 11 This program has not been embraced by apartment owners in Edina. No one used this program in 2019 and only one owner used the program in 2020. Staff will continue to offer this program in hopes of maintaining existing affordable housing units. 22) Community Land Trust program - WHAHLT HRA approved a $1.3 Million line of credit with the West Hennepin Affordable Housing Land Trust (WHAHLT). This includes using $840,000 in grants to expand the Homes Within Reach program in Edina. 23) Affordable Single Family Homes – Metro HRA In 2020, the HRA approved $2 million in funding to support a new partnership between the Edina HRA and Metro HRA. These funds will be used to acquire single family houses in Edina and lease to households on Section 8. The Edina HRA will hold title to the houses, but lease to Metro HRA to maintain and manage for their program participants. FORECAST OF 2021 ACTIVITIES The staff work plans for 2021 tentatively include these activities: • Issue TIF note for 4500 France Ave. – Lorient Apartments • Make TIF payments for Orion 4500 France and Edina Market Street • De-certify the Southdale 2 TIF District at year-end • Evaluate whether to maintain or de-certify the 66 West TIF District • Implement strategy to redevelop the vacant site at 5146 Eden Ave. • Determine viability to implement district parking at 44th & France neighborhood node. • Work with local commercial properties to implement business/tenant attraction program. • Create process to improve communications with local businesses. • Monitor and update policies to support businesses as they recover from pandemic business conditions • Conduct six business appreciation and retention visits with Mayor and City Manager • Make a determination regarding enacting a Tenant Protection Policy. • Monitor and process construction draws for the Sound on 76th (4100 W. 76th Street) • Monitor construction draws for 7075-7079 Amundson Avenue • Work with Developer of 4040 W. 70th Street on funding applications for the development of senior affordable housing. 2020 Edina HRA – Year in Review Page 12 • Continue working with West Hennepin Affordable Housing Land Trust to expand their single family home ownership • Update Come Home 2 Edina website to make more user friendly • Develop workplan items based on the Housing Task Force Report. • Market NOAH 4d Pilot Program • Continue working with Metro HRA on expanding program for Sec. 8 single family households • Develop training programs for owners and property managers in Multifamily rental buildings • Maintain a database on the number and location of affordable housing in Edina. • Investigate possibility of creating a Homeownership Rehabilitation program. • Review process on using affordable housing funds received from the Buy-In option and develop a policy to ensure funds will be used with a race and equity lens. • Work with VEAP to determine need for Rental Assistance in response to COVID-19 Prepared by: Bill Neuendorf Stephanie Hawkinson Economic Development Manager Affordable Housing Development Manager January 28, 2021 2020 Edina HRA – Year in Review Page 13 Exhibit A – Map of Active TIF Districts 2020 Edina HRA – Year in Review Page 14 Exhibit B – Use of TIF in Edina 2020 Edina HRA – Year in Review Page 15 Exhibit C Date: January 28, 2021 Agenda Item #: IX.B. To:Chair & Commissioners of the Edina HRA Item Type: Report / Recommendation, Other From:Bill Neuendorf, Economic Development Manager Item Activity: Subject:By-Law Review Information Edina Housing and Redevelopment Authority Established 1974 CITY OF EDINA HOUSING & REDEVELOPMENT AUTHORITY 4801 West 50th Street Edina, MN 55424 www.edinamn.gov ACTION REQUESTED: No action required; for informational purposes only. INTRODUCTION: The Edina Housing and Redevelopment Authority is governed by a set of By-Laws that can be updated from time to time. T he By-Laws were originally written in 1974 and updated in 2016. Staff does not recommend any changes to the By-Laws at this time.