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02-27-01 WSFebruary 27, 2001 Page 1 MINUTES CITY COUNCIL WORK SESSION -FEBRUARY 27, 2001 A work session of the Hopkins City Council was held at 6:30 p.m. on February 27, 2001, at the City Hall. Council members present were Mayor Maxwell and Council members Brausen, Hesch, Jensen and Johnson. Karen Jensen left at 7:30 p.m. City personnel present were City Manager Mielke, Economic Development Director Kerrigan and Public Works Director Stadler. Also present were Michael Boo of Allina, Jim Vos and Ann Hansen of CRESA, Richard Varda of RSP, John Dietrich of RLK, Miles Lindberg of BRW, Guy Nowlan and Bruce Polaczyk of Hennepin County. CBD Financing Discussion Mr. Mielke noted his memo did not cover the Art Center at all, but addressed only CBD issues. Karen Jensen noted she feels it is time to start looking at funding of the Senior Center; some of those monies should be diverted to the Art Center. Mr. Mielke presented his policy suggestions, asking for feedback if such a policy should be pursued. He noted it did not cover street work, which is a city cost. Special Service Districts are primary sources for new lots, lot reconstruction and enhancements. TIF is no longer a source since legislation requires pre-1979 TIF's (like 1-1) to be used only for debt retirement starting April 1, 2001. The TIF expires in 2004-5; the big question is how to fund projects until then. TIF 2-1 (Minneapolis Moline site) could be used to transfer some funds for Lots 500/600. He cautioned what this Council decides may not be followed through by future Councils. Concerning the proposed CIP for parking lots, Lot 800 should probably be scheduled for the first year after TIF retirement. Mr. Kerrigan noted using 2-1 would be "pooling," which the current legislature may curtail. The money would need to be budgeted by Apri130 and spent by Apri130, 2002. Mr. Stadler explained the cost comparisons. The area cannot be widened without republishing; assessment itself could be changed within those boundaries. Mayor Maxwell noted the 70/30 split is actually only 35% assessment as half comes from funding. General discussion followed. Steve Stadler said it would be possible to pull landscaping out to lower the assessment cost per square foot. Mr. Mielke stressed that the policy needs some flexibility. Mayor Maxwell asked about the HBCA letter. Mr. Mielke said he talked to them. Their feedback was they want to help if they can on the parking lots, but won't be offended if they cannot at this point. Fran Hesch noted they could work on some of the other things for the CBD. General Consensus: Assessing the whole CBD for every lot would not work; assessments should be by project. Ms. Yager should do cash flows for the fund so the Council can get the "big picture. " Staff should justify why landscaping should be "in" or "not in" the plan so that can be incorporated into the policy. Medica Project Update `~~~ '! Director Kerrigan noted a preliminary TIF application will be presented at the March 6 February 27, 2001 Page 2 meeting. Then a development agreement will be drafted; presentation may be in May or June. Mr. Lindberg of BRW presented the changes in the intersection, which has been changed to align with St. Louis/Jackson for better traffic flow and "stacking" for Medica personnel. The studies included three variables due to the HCRA corridor. Both MN DOT and HCRA have had positive reactions. Traffic counts are done; some intersections are not good, but they are due to Highway 7. Using a "worst case scenario" fora 85 car train at peak morning and afternoon traffic, studies show car would queue up but traffic would be handled in a reasonable time frame. He does not feel that even with a 4-arm intersection train whistles would be eliminated. Excelsior/Monroe would be signalized. Neighborhood traffic pattern changes would basically be a trade-off. He had shown the changes to Planning & Zoning earlier that evening. Mr. Mielke noted Benshoof has not replied to the changes yet. Mr. Mielke suggested using 1984-85 figures also for comparisons as that was when Red Owl and Honeywell were active. Mr. Varda of RSP noted the parking ramp had been re-graded so the first level will actually be below ground level facing Excelsior Blvd. ;this will help screen it. First level parking would come only from the north, helping traffic patterns. No firm decision has been made if the builidngs will be 4 or 5 stories. Service trucks would enter from 2nd. There will be 2 ponds, using one for run-off control. The trail system will be incorporated into the property's own trail around the main pond, which will be open to the public. They are trying to tie the existing trails together in the best configuration on their site. Mr. Mielke noted if they plan to use the large pond for ice skating they need to be sure the 2-pond system will allow the ice to get hard enough. Security will include cameras in the ramp. No decision has been made on the extra building as Medica is waiting for Allina's decision. SuperValu has asked for right of first refusal. Director Kerrigan noted SuperValu has agreed to take on more of the site remediation costs. The major difference in the cost analysis is the result of taking a much lower price for the 3-acre site the city wants than the price they paid for it. Ehlers is comfortable so far but will study it more. Sid Inman suggests a 13-year TIF with apay-as-you-go note. Tax abatement is still under discussion. All figures need to stay fluid so will be formula based; thus final TIF amounts may be different. Answering Mayor Maxwell's question, the Council was told "Smart Growth" is basically planning money and won't apply to Medica. It may, however, still be possible for the East End if the scope is widened for that. Mass transit is also not "real dollars," but Medica plans to keep working with both bodies. Mr. Vos added he had talked to Mr. Kramer of the School District, who had no problems with the plan. The change in the presidency of Medica will not be a problem; Mr. Strand has moved up to the "main" company (Allina) and the incoming president is excited about the project. Mr. Boo noted a purchase agreement is scheduled to be signed March 14. General Consensus: The Council is still behind the project and the application should be presented at the Council meeting. East CBD Update Director Kerrigan said acquisition so far has been difficult. Only Lot 5 has been agreed to and a Purchase Agreement drafted. Kost has given a verbal yes if the business can stay in the building 6-12 months more. Luther properties are "no unless we can be the developer" and David February 27, 2001 Page 3 Luther is out of town. Lornan is interested and Mr. Kerrigan is waiting till the attorney is available. If TIF 1-1 is used, the money must be spent by April 1. After that Economic Development funds could be used, but would be less funding ($4-500,000 less than the $1.6 million). The Beard Group has pursued the idea of developing the block and would consider doing a partial block. The Phase 1 environmental has been done and indicates no problems. If the project is not pursued, the Kost property code violations need to be pursued. General Consensus: General feeling was it should be the whole block, but Council would be willing to look at Beard's downgraded design. Rudy Luther and the Loman family need to be talked to immediately. The Council should be updated at the 3/6 Council meeting. CSAH3, Phase 2 Update Director Stadler said city cost would be $2.9 million, with a total cost of $4 million. The city cost for the road reconstruction is $.5 million. The project design is basically complete. The major issues at present are how Medica will impact the plans and the railroad grading lead time (6 months). He will be meeting with the county March 7 where discussion of waiting for Medica development will be discussed. Mr. Nowlan said it seems now that no walls will be built for .Blake School as it would take too much land. He later said that it would not be feasible to do east of Jackson, then wait and do west of Jackson with Medica due to the shift inroad alignment to the south. _ Ms. Johnson suggested that the neighborhood landscaping south of Excelsior Blvd. be done right away to help the residents, then wait for the road reconstruction. Mr. Polaczyk said right of entry is a big issue on the U-Haul site, a worst case scenario would take 4-5 months. He agreed postponement of the project made sense. He said a county staff meeting would take place Wednesday and he will convey Council concerns then. Mr. Nowlan asked if the Council would do a resolution and was told that would be 3 months or more away as Zoning & Planning needs to hear the issues and neighborhood meetings would need to be held before Council can make a decision official. General Consensus: Neighborhood landscaping is top priority. Road reconstruction should be postponed to interface with Medica intersection work. Mr. Stadler should check if the trail underpass is still under consideration. Other City Streets: Sand and salt supplies are adequate. Director Stadler will check on handicapped cutouts clearing. Council members complimented street staff on their quick work after storms . Beverage & Food Tax. City Manager Mielke has met with Rep. Betty Folliard, who will get the legislation introduced before deadline. Mr. Mielke feels the city should get the authority, then decide if they need to use it. Nuisance Ordinance. Mayor Maxwell said New Brighton has passed an ordiance. Staff will follow up to see if it can help Hopkins staff drafting one. City Manager Evaluation. Council will continue this after the Council meeting Tuesday. Meeting. City Manager Mielke will follow up on the proposed meeting of Ted, Fran and February 27, 2001 Page 4 Sharon. Fran Hesch moved adjournment. Diane Johnson seconded. Meeting adjourned at 10:10 p.m. Kasey Kester, Secretary ATTEST: Eu ne J axwell, Mayor COUNCIL MEMBERS