Title
Approval of the March 28, 2012 HRA meeting minutes.
Body
ROLL CALL
Present: Commissioners Bostrom, Brendmoen, Carter, Lantry, Stark, Thune, Tolbert
CONSENT
1. Approval of the March 14, 2012 HRA meeting minutes.
Commissioner Lantry moved approval.
VOTE: Yeas - 7 Nays - 0
2. Resolution Authorizing Grant of Easement to District Cooling St. Paul Inc. across the Robert Street Parking Ramp, 95 East 7th Street, Downtown, District 17. \
Commissioner Lantry moved approval. Approved as set forth in resolution RES 12-586
VOTE: Yeas - 7 Nays - 0
PUBLIC HEARING
3. Resolution Approving the Sale of Land and Conveyance of Parcel 1776 Maryland Avenue East, Unit 307, Hazel Park Heights Condominium Project, Greater East Side, District 2
Ms. Cecile Bedor, Executive Director for the HRA stated that staff has executed a purchase agreement for the property located at 1776 Maryland, in the amount of $94,000, to Mr. Ronald Snaza.
Chair Thune announced the public hearing. There being no testimony Commissioner Bostrom moved to close the public hearing and approve the resolution. Approved as set for the in resolution RES PH 12-95.
VOTE: Yeas - 7 Nays - 0
DISCUSSION
4. Resolution Approving Issuance of Satisfaction of Mortgage on Forgivable Loan with Hazel Park Heights, LLC, Greater East Side, District 2
Ms. Bedor stated that on September 28, 2005, the HRA Board approved a $1,190,000 forgivable loan, and a HRA guaranty of $600,000 towards the presale requirements for the 27 unit, Hazel Park Heights, Condominium project. Ms. Bedor stated that the members of Hazel Park Heights, LLC are the North East Neighborhoods Development Corporation (NENDC), and Hazel Park Investor, LLC which is owned by Zeman Construction Company and Dennis Guptil, who brought the construction financing to the project. Ms. Bedor explained that approximately $44,000 of the forgivable loan was to be forgiven as each unit was sold. As a result of sales to date, the loan balance has been reduced to $528,888.95.
Ms. Bedor stated that the housing market continues to be slow, and potential buyers are having difficulty getting mortgage financing for condominium units. In addition, Anchor Bank has informed Hazel Park Heights, LLC that it will not be renewing their construction loan, thus requiring Hazel Park LLC to obtain new financing. The outstanding HRA loan is inhibiting their ability to obtain reasonable financing. Since the intent was always to forgive the loan in its entirty as units were sold, and since the HRA wants to ensure the project is successful for current and future home-owners, staff is requesting that the Board forgive the balance of the loan.
Commissioner Bostrom stated that this has been a tough project; it's a great building in a great location, and it was a much blighted site before this project developed. Timing is everything, and by the time the building was completed and a few units were sold, everything about the housing market started to deteriorate. They have been aggressively trying to sell the remaining units, to preserve the value for the early buyers.
Commissioner Bostrom moved approval. Approved as set forth in resolution RES 12-570
VOTE: Yeas - 7 Nays - 0
5. Authorization to Approve Funding for Site Clean-up Costs at Parcel 840 Payne Avenue (Kendall Hardware Store Site), Payne-Phalen, District 5
Ms. Bedor stated that Ramsey County had received significant funding to widen Maryland Avenue, and in order to do so Kendall Hardware Store needed to be relocated by May 15th. The HRA had provided a land note of $380,000 plus approximately $950,000 in CDBG funds for the project. Staff is seeking additional funds to address contamination issues, and to remove underground debris. Neither were identified from recent soil borings nor from Saint Paul DSI records, and were only discovered after a title issue surfaced, that lead the digging of actual test pits. Ms. Bedor explained that the estimated maximum cost to address these issues is $150,000. Ms. Bedor noted that if the site is to be developed now or sometime in the future, these issues would need to addressed.
Commissioner Bostrom stated that the owners of Kendall's Hardware were present, and thanked them for their patience with the relocation process and that he hopes that this is the last hurdle within this project.
Ms. Bedor stated that Sheri Pemberton was the project manager for this project as well as for the Hazel Park project and has given both projects a lot of her time and attention.
Commissioner Bostrom moved approval. Approved as set forth in resolution RES 12-568
VOTE: Yeas - 7 Nays - 0
6. Resolution Authorizing Execution of Amendments to Documents with Respect to a Financing for the Benefit of Community of Peace Academy
Ms. Bedor stated that in November 2006, the HRA issued $17.2 million of Series 2006 Lease Revenue Bonds for the Community of Peace Academy capital improvement project, and also to advance refund on approximately $10 million in 2011 Bonds. The proceeds of the 2006 bonds were loaned to the Community of Peace Building Company which in turn leased the project to the Community of Peace Academy, and all the improvements that had been contemplated were completed. The Project also received a $700,000 STAR loan in 1998, and the school is obligated to make monthly payments of $5,535 with a final maturity of 12/1/2014. Community of Peace Academy is current on the loan however, due to the delay of the State's payments to schools, the School needs to secure a line of credit in order to bridge the gap. In order to get the additional credit, potential Lenders are requiring the HRA to subordinate the STAR loan. Staff is recommending approval.
Commissioner Stark asked if there are other schools that the HRA has lent resources to that we might expect more of this type of action in the future. Ms. Bedor stated that there have been no other inquires to date, but staff will check to see if there may be an issue with other projects.
Commissioner Brendmoen moved approval. Approved as set forth in resolution RES 12-591
VOTE: Yeas - 7 Nays - 0
Ms. Bedor introduced Ms. Karen Rusthoven, Executive Director for the Community of Peace Academy, and her staff who were present at the meeting.
STAFF REPORT
7. City of Saint Paul 2010 Informational Report on Tax Increment Districts.
Ms. Jenny Wolfe, PED gave a verbal report on TIF Districts in the City of St. Paul.
Commissioner Tolbert asked how Saint Paul has done, historically, in its selection of TIF sites, in terms of spurring economic development.
Ms. Bedor stated that our goal is to have less than 10% of our tax capacity tied up in TIF, and that the HRA has been successful in doing so. Staff recommends TIF only I the but/for test is met. The projects that the City wanted to complete with TIF were completed, and are good projects; whether or not they have the spill over effect of additional development is uncertain as there a number of factors considered by developers when pursuing real estate development.
There is no action required for this item. Staff Report only.
ADJOURNMENT
Commissioner Bostrom moved adjournment. The HRA meeting was adjourned.