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IV.3. Minutes of the October 10, 2017 City Council Work Session Proceedings HOPKINS CITY COUNCIL WORK SESSION PROCEEDINGS OCTOBER 10, 2017 CALL TO ORDER Pursuant to due call and notice thereof a regular work session of the Hopkins City Council was held on Tuesday, October 10, 2017 at 6:30 pm. in the Raspberry Room at City Hall, 1010 First Street South, Hopkins. Mayor Cummings called the meeting to order with Council Member Campbell, Gadd, Halverson and Kuznia attending. Staff present included City Manager Mornson, Community Development Coordinator Beekman, Planning and Development Director Elverum, Assistant City Manager Lenz, Public Works Director Stadler and Housing Officer Unowsky. HOPKINS HISTORICAL SOCIETY UPDATE In addition to City staff, representatives present for the item were Hopkins Historical Society Board Members Colin Brown, John Cooley, Dean Empanger, Jim Genellie, James Zdrazil and Angela Wolf Scott, MacDonald & Mack Architects. Mr. Cooley discussed the Masonic Lodge structure report, a complete look at the state of the building. The revised final draft came in at a cost of over $4.5 million dollars. Ms. Scott discussed the immediate needs of the project including asbestos removal, electrical & plumbing upgrades, HVAC system upgrades, floor reinforcement and ADA compliance. Ms. Scott commented that many of the building systems are undersized and at their useful end. There was discussion about phasing of the projects to allow the Historical Society to move into the building sooner. Ms. Scott commented on the great opportunity to reuse a historic building and that the most effective way to pair down the budget is to phase the work and focus on the main floor space. Mr. Cooley commented that the Historical Society Board could treat the project as a smaller building and focus on the main floor. The cost for the main floor design still needs to be determined. The City Council and Historical Society Board discussed the options to treat the building as a one-story and use the lower level for storage rather than public space. The Historical Society Board discussed the idea to use the lower level as rental space to generate revenue but it is very costly to make it useable. There was discussion about use of volunteer labor. Ms. Scott commented that a project contractor would need to coordinate demolition and that volunteer labor could be used for some aspects of the project. The Council commented that the building is a great opportunity to maintain the history of Hopkins. The Historical Society Board commented that they have not broken out the costs and figured out the path to get the museum up and running. Mr. Genellie commented that the funds needed are in the millions of dollars and it is a huge undertaking for the Historical Society but the board wants to move forward. The Council asked about the time frame. Mr. Genellie commented that the Board is in the process of seeking the opinion of a capital campaign consultant to demonstrate to the Board that fundraising is feasible. Ms. Scott commented it is important to reach out to others who have done this type of fundraising and that the Board should have an opinion by the end of the year. HOPKINS CITY COUNCIL WORK SESSION PROCEEDINGS OCTOBER 10, 2017 Mayor Cummings commented on the value of the museum and it is critical to maintain the City’s history. The Historical Society Board commented that they greatly appreciate the support of the City and that they have passed a motion to move forward with the project. Mr. Cooley commented that Minnesota Author, Mary Krugerud, will discuss her book “Interrupted Lives: Tuberculosis in Minnesota and Glen Lake Sanatorium” at the Historical Society Annual Meeting on Sunday, October 29, 2:30 p.m. at the Hopkins Activity Center. PUBLIC WORKS PAVILION PROJECT Public Works Director Stadler discussed the project budget, schedule, contracts and government purchases for the Pavilion construction project. Staff is looking at three proposals for a Construction Management Contract. The Construction Manager would look for ways to cuts costs, manage sub-contractors and keep the project on its fast moving schedule. The cost for the Construction Manager is included in the total project budget. The item will be on the upcoming City Council agenda. AFFORDABLE HOUSING DISCUSSION Planning and Development Director Elverum gave an update on the affordable housing discussion. Hopkins staff has been participating in an Affordable Housing Work Group. Ms. Elverum discussed what other cities have been doing such as owner meetings, Inclusionary Housing and Section 8 Policies. Ms. Elverum discussed some tools that the City of Hopkins can use to formulate the best policies.  Housing advocates would like to see Hopkins adopt a Section 8 policy. Staff is waiting on the City of Minneapolis decision. The Met Council administers the Section 8 program for Hopkins. There was discussion about tenant protection when a new ownership takes over a building and tenant selection criteria.  Just Cause Non-Renewal would require rental property owners to give an allowable reason from a standard list for a non-renewal. This gives tenants a longer notice and allows a tenant to contest a non-renewal if they feel it is not justified.  Advance Notice of Sale would give affordable housing developers notice of the opportunity to purchase a property. Staff discussed property owners concern of limiting the number of buyers and the expectation that City staff would have knowledge of a sale. There was discussion about what is the target threshold for size and rent level of properties for Advance Notice of Sale. Ms. Beekman commented that there is some county funds to purchase NOAH properties but the challenge is connecting buyers with properties.  Staff is just beginning to explore the concept of incentives to businesses for affordable and rent subsidies in exchange for rental rehabilitation loans. Staff is meeting with other cities to see if this is a viable option.  Inclusionary housing would require affordable units within new construction. Most neighboring cities have policies but Hopkins looks at each individual development site on a case-by-case basis. Ms. Elverum commented that Hopkins has exceeded HOPKINS CITY COUNCIL WORK SESSION PROCEEDINGS OCTOBER 10, 2017 over 20% affordable units with the last two developments. Ms. Beekman discussed the impact of inclusionary zoning and mandatory percentage of affordable units in a new development. Ms. Elverum discussed the changing housing market and commented that City staff will continue to explore project-based Section 8 voucher program with the Met Council. Ms. Elverum discussed the next steps including identifying additional information, policies/programs and consulting with legal experts regarding policies. Staff will continue the discussion with the City Council at upcoming Work Sessions. Christine Hart, Community Action Partnership with Hennepin County, came forward and discussed the urgency for naturally occurring affordable housing (NOAH). Ms. Hart stressed the importance of Advance Notice and Just Cause for tenants and the goal to have preservation buyers purchase properties. Mayor Cummings commented on the affordable housing crisis and the right for all people to have safe, secure and stable housing. The City needs to move forward and develop policy that addresses the needs but with a lot of consideration and thought. There was discussion about the concerns of property owners. Urban Land Institute (ULI) is bringing owners together for discussion about what policies would be effective. There was also discussion about the need for better educational campaign for property owners regarding the Section 8 program. Ms. Unowsky explained the Section 8 process and inspection component. Mayor Cummings asked about businesses, who are employers in the community that could contribute toward maintaining and establishing affordable housing. Conversations are needed with the business community. There was discussion about the use of CDBG funds to fund rental rehab and the Cold Storage development site. Ms. Beekman discussed the current use of the CDBG funds and options for other funding sources. A policy does not need to be in place prior to the Cold Storage site development since Tax Increment Financing (TIF) would set the affordable housing parameters. There was Council discussion about the importance of tenant protection, property owner penalties, enforcement and incentives. Ms. Elverum commented that the rental license would need to be amended and that staff needs to seek further legal opinion from the City Attorney. Staff will keep the Council updated and contact legal staff for further discussion. ARTSPACE REPORT In addition to City staff, representatives present for the item were Ms. Wendy Holmes and Ms. Anna Growcott, Artspace. Community Development Coordinator Beekman discussed the preliminary feasibility report and findings. HOPKINS CITY COUNCIL WORK SESSION PROCEEDINGS OCTOBER 10, 2017 Ms. Holmes discussed Artspace’s mission, business history, area projects, preliminary feasibility study process, Arts Market Study, public input process and project development. Ms.Growcott discussed the six areas of consideration, project concept findings and the recommendation for a mixed-use artist housing development with retail and commercial components on the ground floor. Ms. Growcott discussed the Arts Market Study that would quantify and test the potential project. Ms. Growcott commented on the strong local leadership and the involvement of private business and arts organization leaders to propel the project forward. Ms. Growcott discussed private and philanthropic funding sources and gave an overview of 2017 median income and rent. Ms. Beekman discussed the potential sites for the location of a 50-70 housing unit and commercial space. The next step is to undertake an Arts Market Study and assemble a core group of advisors to guide process. Ms. Holmes discussed the goals of an Arts Market Study and gave an overview of the steps, objectives and costs. The cost for the Arts Market study is $30,000 and predevelopment costs are $750,000. Ms. Elverum discussed sources of funding for predevelopment costs including a mixture of sources such as foundations, city and county funds. There was discussion about the Shady Oak station area and development on parking lots. Staff did not look at the Shady Oak station area due to the unknowns of SWLRT construction timing. The focus was on the downtown with the location near the Hopkins Center for the Arts and Stages Theatre. Ms. Beekman commented that public parking would be incorporated into the site plan. Staff recommendation is to move forward with the Arts Market Study in the first quarter of next year. Staff is working on a grant to cover the costs. There was discussion about having Stages Theatre assist with funding. Staff will discuss this possibility with Stages. Staff and Council are excited about the possibility and Artspace will send out final report when complete. SOUTHWEST LIGHT RAIL TRANSIT (SWLRT) UPDATE City staff met with SWLRT project staff regarding project scope reductions and changes. Ms. Elverum explained that the SWLRT stations will not be cut and that all cuts will be uniformly applied to the affected cities. The reductions and changes included:  Waive or reduce building permit fees by 50%. Staff discussed this with Building Official Kearney and he was comfortable with the change since all the stations are uniform. There was discussion about utilizing a group of inspectors or defer to the SWLRT inspections. Staff felt it is important to have Hopkins represented. Ms. Elverum commented that the permit fees for the Operations and Maintenance Facility would remain since it is a unique building.  Striping with paint. Staff will discuss further with Engineering Department. HOPKINS CITY COUNCIL WORK SESSION PROCEEDINGS OCTOBER 10, 2017  Different type of pipe. Eden Prairie has hired a consultant to evaluate the process.  Modify the station fence. No change to the decorative fence.  Reroute of the temporary bike detour. The detour may affect the Depot Coffee House.  Full short-term closure of Excelsior Blvd. Public Works staff agreed to the closure as long as it is coordinated. UPDATES  Council Member Kuznia discussed resident comments about the Park Valley Playground upgrades. Staff will continue to get input from the neighborhood.  Council Member Gadd discussed a resident concern about overnight parking Maetzold Field parking lot.  Discussion of ideas how City Council would like to be involved in the Old Fashioned Holiday in Hopkins. City Manager Mornson gave the following updates:  Community Image Awards press release.  Sunday Star Tribune will feature an article on the Friendly Fronts program.  Discussion of Humphrey School of Public Affairs Innovations Awards applications.  Discussion of the $8.7- 9 million bonding amount. ADJOURNMENT There being no further business to come before the City Council and upon a motion by Campbell, second by Kuznia, the meeting was unanimously adjourned at 9:31 p.m. Respectfully Submitted, Debbie Vold ATTEST: ___________________________ ____________________________ Molly Cummings, Mayor Amy Domeier, City Clerk