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HomeMy WebLinkAbout03.28.11 EDA Packet AGENDA ECONOMIC DEVELOPMENT AUTHORITY March 28, 2011- 6:00pm City Council Chambers, City Hall AuthorItY Members 1. Call Meeting to Order 6:00pm Chair, Jason Bartholomay 2. Pledge of Allegiance Vice-Chair, Christy Jo Fogarty 3. Approve Agenda Julie May 4. Citizens Comments/Presentations a. Becky Leebens - Will provide an overview of the marketing, leads, challenges or recommendations she has as the EDA's listing agent and provide an update on the market overall. Terry Donnelly Mayor Todd Larson 5. Consent Agenda 6:15Dm Cltv Staff Reoresentatlves a. Meeting Minutes i. February 28, 2011 Executive Director, ii. March 14, 2011 Peter Herlofsky, Jr, b. February Budget Details City Administrator C, Bills: 2/28/11 - 3/27/11 Tina Hansmeler Economic Development 6. Public Hearings Specialist Lee Smick 7. Continued Business 6:25Dm City Planner a. Economic Development Strategic Plan, Lee Smick Cindy Muller b. Grow Farmington Update, Lee Smick Executive Assistant C. McVicker Lot Update 8. New Business a. Former Senior Center Building 430 3rd Street Farmington, MN 55024 9. City Staff Reports/Open Forum/Discussion Phone: 651.280,6800 a. Major Economic Development Activities - March http://www,ciJarminlrton,mn,us b. Roundtable 10. Adjourn The Farmington EDA 's mission is to improve the economic vitality of the city of Farmington and to enhance the overall quality of life by creating partnerships, fostering employment opportunities, promoting workforce housing and by expanding the tax base through development and redevelopment, J:\HRA-EDA\BOARD AGE]\DAS\101 I Board Agcndas\0328 I 1\03281 I Agcnda.doc -~CL MINUTES ECONOMIC DEVELOPMENT AUTHORITY Regular Meeting February 28, 2011 1. CALL TO ORDER The meeting was called to order by Chair Bartholomay at 6:00 p.m, Members Present: Bartholomay, Larson, May Members Absent: Donnelly, Fogarty Also Present: Tina Hansmeier, Economic Development Specialist; Lee Smick, City Planner; Cynthia Muller, Executive Assistant 2. PLEDGE OF ALLEGIANCE 3. APPROVE AGENDA Member Larson added 4b) Colby Group, Chair Bartholomay added 5c) January 2011 Budget Details, Member May requested an update on the Elm Street Garage and the old Rambling River Center under Roundtable, MOTION by Larson, second by May to approve the Agenda, APIF, MOTION CARRIED. 4. CITIZEN COMMENTS/PRESENTATIONS a) Mr. Gerry Zielinski, Zielinski & Partners Mr. Zielinski gave a presentation on his marketing services, b) Colby Group Mr. John Colby, Crowne Pointe Development, stated they are ready to move forward with their previous proposal. They started with an effort in Byron, MN, and Mr. Colby stated information from that effort has been used against them. Now they have an outstanding opportunity with major national players to develop 80 - 100 units across the United States, They are building family friendly destination locations that drive traffic. With their dome they will be able to bring in 500,000 visitors a year. With the economy down, people are looking for low- cost, regional entertainment. For the Farmington project, they are proposing a fast food national chain, a retail/grocery, a major movie theater chain, a major fun center chain, convenience store, and a hotel. That would make this a $37 million project, the center of which is the dome, Crown Sports would build, own and operate the dome. They would sell pad sites to the other businesses. The dome would be used for training for various sports and also selling of sports equipment. The change from the previous proposal besides the 200,000 sq, ft. of turf, the dome would also include six volleyball courts or convert it to five basketball courts, There would be two full fields especially for softball with 300 ft, fences, the courts at one end, and office/retail at the other end. The retail would be rented out to a restaurant or other major retailers, EDA Minutes (Regular) February 28, 2011 Page 2 There would be a section between the dome front and the movie theater with a streetscape. Mr, Colby proposed having a grocery store on the lower level and a hotel on the upper level. The hotel along with the fitness operation would have an aquatic center, This would be across from McDonald's. The dome is considered personal property or equipment and taxed that way, not as a structure, The other properties would create additional tax revenue to the City of $600,000 - $650,000 a year. The dome would be located on the county property with Knutsen Drive extended to the west to Eaton Avenue. He suggested this would be a good location for a traffic signal on hwy 50, The Colby Group would like to purchase the 17,9 acres from the bank and have the bank pay the City the assessment. They have been told the street assessments are paid by the banks when the property is sold and then 87% is rebated back. Mayor Larson did not believe that is the way it works, He noted as of last week, the banks did not have 100% control of the property yet. The City should know more this week. Mr, Colby stated the banks are hearing rumors and Crowne Pointe has a serious offer on the table to them and they are not responding, Part of it is the current situation and part of it is how the banks view the Colby Group. The banks are wondering if this development will happen, Mr, Colby stated the banks have called City staff and were told this project will never happen, Mayor Larson was not sure that is the case and that there were a lot of rumors, Mr, Colby distributed a list of the major players for this project. This is a much bigger organization than just the Colby Group. Mr, Colby wanted to find a way to get through the rumor mill and determine if Council wants to move forward, They would look to the City to do something in that area; it does not have to be ice, Mr, Colby stated pumps are primed for the sale of four acres, They are trying to stay away from as much debt as possible as that would slow down their growth, Mayor Larson stated the Colby Group wants the City to purchase four acres from them at a price of $2 million, Mr. Colby confIrmed this and they are trying to find a use that synergistically works. Mayor Larson asked why it has to be the City, Mr, Colby was open to having that discussion. Mr, Colby stated they would not look for the City to spend a dime. This would be a simultaneous close with two of the other parties, The Colby Group needs to show the bank this is a serious deal. If they agree, the Colby Group would bring the other two parties to Farmington. The Colby Group right now is working on seven other sites. They do not want to put money into architectural drawings if they will not get the land, They also need to work on securing the other ten acres from Dakota County which Mr, Colby hoped the City could get a favorable deal on, There would be some remediation with the diesel tanks which need to be cleaned up, They Colby Group would then purchase the county land from the City for the same cost, Mr. Colby has not talked with Dakota County as they received indication that it was best for the City to work with the County, He felt the transfer price from the County to the City would be much less thana public bid, The Colby Group would build the dome which is key to driving traffic and bringing in other companies, Their proposal is the TIF EDA Minutes (Regular) February 28, 2011 Page 3 from the Vermillion Crossing area would go to the City. The State has a nine year nF for any project that is started before July 1,2011. Mr, Colby felt this is a way to lift the burden placed on the City due to Vermillion River Crossing, Mr. Colby was looking for the EDA to say yes, they want to move forward. If the EDA votes yes, the City will receive 10+ new businesses, 125+ jobs, a tax base increase of over $30 million, the annual benefit is a plus $600,000 versus the cost today, Doing that over nine years, which is the timeline to complete the project, that could be a significant amount of dollars to the City over those nine years. Option B is the Colby Group has a handshake agreement with Mr, Babe Murphy on the north side ofhwy 50, If they go to a green field site, they would approach it differently, With that the City is not getting the benefit of the project being at Vermillion River Crossing, but the Colby Group is taking all the risk by doing it privately. They would look to receive the nF and abatement. Option C is the EDA does not want the development. If the choice is option A, they need to reach an agreement. If the choice is option B, they need a development agreement done right away, Chair Bartholomay asked about the plan for option B. Mr, Colby stated it is a similar plan, but there is a gas line running through the property and it would have to be laid out differently, City Planner Smick noted they also have to look at the zoning. Mr. Colby stated if the EDA says no to option A and we cannot get zoning for option B, then all we have left is option C. This project would also require a comp plan amendment. Mayor Larson asked if we went with option A, what would the Colby Group need from the City. Mayor Larson saw the first thing would be $2 million from the City to purchase four acres. Mr. Colby stated the first thing would be the development agreement which would entail a contingent purchase agreement based on criteria agreed to by both parties, to exercise at a simultaneous closing with a couple other businesses to come in, The biggest issue is will the dome be built. If not, why would the City buy four acres? The wild card is the Colby Group does not know what the costs are associated with the ten acres from the county, That would also be identified in the development agreement to determine whether to go forward, There could be remediation expense that makes the project not worth while, The development agreement would also provide communication back to the banks that this is moving forward. The Colby Group has increased their price to a level double what the property is worth, They are also dealing with other ring suburbs and negotiating for property on the east side fronting 94 at $3/ft and also on the north side which would be comparable to Farmington in the $1.25/ft range, They understand the banks are against the wall in trying to get something done. Part of what is driving them to move now is in December when the unemployment benefits were extended, in 2011 the legislature passed a one-year bonus depreciation for any equipment with a useful life of less than 20 years as an immediate write off. This is significant to the Colby Group and their investors because they can work with the tax benefits and speed up the repayment of the dome, the turf, courts, lights, and restaurant EDA Minutes (Regular) February 28,2011 Page 4 equipment. A significant portion of the dome would qualify as an immediate write off and allows a return to the investors at a much higher rate. Mr, Colby's goal is to do as many of these projects as possible this year to take advantage of that. Member Larson stated they also want the City to purchase the county property and resell it to the Colby Group, Mr, Colby confirmed this and the issue is to make sure there is no trailing liability from an environmental standpoint. Member Larson stated all this should be done by July, Mr, Colby would like to have the agreement as they only have to start moving dirt by July 1, to qualify. As far as the equipment, the turf and courts will take 3-4 weeks to construct and the dome goes up in one day, If that was in by Thanksgiving, the rest would be in place by the end of the year to qualify. Member Larson asked how the Colby Group plans on funding this project. Mr, Colby stated they are doing a combination of private investors which will either be debt or equity portions in the way they give up the least amount of ownership. That is augmented with the third party sales of the other parcels as part of the development. With that they are able to fund the dome, It would be a combination of private investors and third party land sales, Member May asked what amount of cash the banks are asking for upfront. Mr, Colby stated they are not using banks. They are going directly to private sources, Everything is being paid for as it goes up and the backing is through private investors, Member Bartholomay stated with option B, things would change dramatically with the pricing, Mr, Colby stated their pricing is based on the traffic they drive. They are able to purchase a parcel and bring value to the property, People are coming because ofthe traffic that will be there, Chair Bartholomay asked how much Mr, Murphy was willing to sell his land for, Mr. Colby could not disclose that. Chair Bartholomay stated it would be nice to have a price sheet broken down by option, Without the entire EDA present, he would not be comfortable making any decisions. Member Larson also asked for a breakdown for the Finance Director to review. He would not make a decision without a fmancial review. The City would like to see the project, but do we have the funding mechanisms in place and can we purchase the county building, he has no idea, Member Larson asked what changed from the last time they were here, Mr, Colby stated they have the other third party land sales plus with the tax law changes, the ability to get the private investment. Previously, they were looking at doing two sheets of ice and using that to drive the project. Here there is a catch that we have to get over a hurdle the banks have created, That is why they are looking for help from the City, Member Larson suggested the Colby Group provide the requested information for the Finance Director to review and it can be discussed with the full EDA and the City Administrator, Once the information is received, the Finance Director will begin reviewing it. EDA Minutes (Regular) February 28, 2011 Page 5 Member May stated this feels like the last time a presentation was made and it comes across very vague, She was completely lost with the fmancing, She clarified Crowne Pointe purchases land and then it is sold at a different price, Mr, Colby stated Crowne Pointe is picking up immediate benefit from those sales. Member May stated the EDA needs to see that detail. Mr. Colby will supply that information, Member May stated earlier Mr' Colby mentioned the credibility issue. The fmancial detail will bring more credibility to the overall plan, Mr' Colby stated if he had a Purchase Agreement from a bank, he could go to the other parties and get a conditional Purchase Agreement from them, which would give the EDA what they are looking for, Mr' Colby stated what the EDA is saying is they would like the development in Farmington and let's start sharing information. Mr. Colby will not risk a relationship with a national chain that gets caught up in a lot of static, That is why they are trying to determine which piece of property tc use. Member May stated a term often used in banking is what kind of skin do you have in the game. We need to know who the players are and what everyone has into the project. It comes down to evaluating the risk. Member May recalled the first time it was all about hockey and that should be part of the discussion as that would cost more, Mr, Colby stated they have enhanced their revenue stream with the dome. They would like to see hockey, Two sheets of ice there would be another means to drive traffic. They had a unique meeting with members of the School Board last week, They were invited to a meeting because one of the School Board members had told the Colby Group if the City cannot get the ice done, may be we should do it. The Colby Group went to the meeting and the first thing they were told by the school was there is no way we will do ice; the City should do it. Mr. Colby would like to see two sheets of ice as it will bring more traffic, but if that is a flash point, then do something else, If you are going to use appropriations bonding you have to show some revenue, A single or double sheet of ice will show revenue. They can then work with the City to determine how to make it work so the Colby Group and the City both get what they are looking for. 5. CONSENT AGENDA MOTION by Larson, second by May to approve the Consent Agenda as follows: a) Approved Meeting Minutes January 24,2011 b) Approved Bills 1/24/11 - 2/27/11 c) Budget Details: December 2010 Preliminary January 2011 Regarding legal expense, Chair Bartholomay noted $5,000 is budgeted for 2011 and we have already used $1,800. Staff confirmed legal bills are at $1,600, This is for two title commitments; one for 305 Third Street and one for the McVicker lot. This was to facilitate selling the properties, Member May noted in December there was $20,300 transferred. Staff will check on the reason, MOTION by May, second by Larson to approve the budget details. APIF, MOTION CARRIED. EDA Minutes (Regular) February 28, 2011 Page 6 APIF, MOTION CARRIED. 6. PUBLIC HEARINGS 7. CONTINUED BUSINESS a) Economic Development Strategic Plan - Grow Farmington At the last Grow Farmington meeting, the top three objectives were Promote Farmington, Brand Farmington, and Unite Farmington. Attendees will be given a list of action steps under each objective, choose a topic and come up with three priorities from the list and who will do them and how they will accomplish the task. The next Grow Farmington meeting will be March 2,2011. The EDA was very pleased with the plan and the amount of attendance at the meetings, b) Farmers' Market The Farmers' Market will be held for 10 weeks on Thursdays, from July 14- September 15, The location will be on Third Street between Oak and Spruce Streets. The businesses are in agreement with the arrangements, The EDA was provided with a budget for the Market. Vendor applications are still being received. c) 305 3rd Street, Lease Amendment The tenants have requested a reduction in the rent from $1,146,75 ($9/sq, ft.) to $764,50 ($6/sq, ft.). The tenants will provide a 30-day notice to vacate the property if the rent is not reduced, In order to keep the building occupied, staff is recommending approving the reduction, Member Larson asked about the For Sale sign in the window and asked if that issue has been resolved, The realtor has spoken with the tenants and they did agree to the sign, Staff and the realtor are looking at fmding an alternative location for the sign and changing the wording. Chair Bartholomay was not too concerned about the wording and did not want the realtor to incur more cost. No matter where you place the sign, the building is still for sale. Member May stated the EDA's plan was to sell the building, This is another example of why the City cannot be a landlord. We don't want another vacant building, but she was not in favor of the reduction. We entered into the agreement with the understanding they would purchase the building, It is unfortunate that did not work out. If we lower our price, the next person would lower their price, The issue with the For Sale sign made the decision for her, We have to market the building for sale, She wanted to stay with the plan, Staff stated it is still being marketed online in addition to the sign, Chair Bartholomay asked about the taxes. Taxes are $4,600/year, utilities are $385/year, He asked if staff has asked the realtor if it would be easier to sell the EDA Minutes (Regular) February 28, 2011 Page 7 building if it was empty, Staff will discuss this with the realtor, Member Larson wants to continue to market the building, but also treat it as an incubator location for businesses. He would agree with the reduction so we have some revenue. Chair Bartholomay felt we need to look at this with the full EDA in attendance. He asked what a fair notice would be to give them a notice to secure fmancing or do something else. Staff noted the lease calls for a 30-day notice. Chair Bartholomay suggested talking with the tenants if they think they could succeed within the next six months or if their plan is to just continue leasing it. When staff was notified they would not be able to purchase the building, the tenants indicated they could review financing in a year. Chair Bartholomay asked how much staff time it is taking with having a tenant in the building, It does take more staff time with a tenant in the building than if it were empty. Chair Bartholomay noted we have a very tight budget and we need to live within that budget. Member Larson stated when you turn off Elm Street onto Third Street and first thing you see is an empty building, that is a negative, Ifbuildings are occupied, that is a positive. We have to think about the negative affect with that building being empty. Other business owners in attendance stated their rent is $7,50 - $6,50/sq. ft, They have heard that some people do not shop here because businesses leave after six months, MOTION by May, second by Larson to approve an extension of $764.50/month for one more month, This should be brought back to the March EDA meeting. APIF, MOTION CARRIED. d) McVicker Lot Update The EDA has received a purchase offer for the Me Vicker lot from Dr. Dungy for a dental office, The agreement lists items the developer and the EDA would be responsible for. The purchase price is $38,500. He would construct a 3,000 sq. ft, office/medical building. At closing the developer would be in favor of executing easements for a stairway access agreement for the property to the north and an easement agreement to allow for a public sidewalk along the southern portion of the property. He will have to do a Phase I environmental study and soil borings, The developer will pay the title insurance, recording fees, one half of the closing costs and his broker commissions, The EDA will be responsible for the $18,000 assessment, the deed free of restrictions has been obtained from the State, the EDA will provide the easement documents with legal descriptions, construct the walkway on the southern 15 ft. of the property, obtain title insurance, pay the State deed tax, recording fees, cost for the survey, legal descriptions, and the EDA's broker commission. The developer has requested financial assistance to make the project work. The developer has submitted a business subsidy application. There are excess TIP funds of $64,000 that if the EDA did not award to a project this year, would revert back to the County, There are past expenditures on the lot amounting to $33,818.85, and future expenditures for outstanding assessments, realtor EDA Minutes (Regular) February 28,2011 Page 8 commission, and the walkway for $36,878.23, for a total of$70,697,08, Past expenditures included the demolition of two structures on the lot in 1991, This is on the books as debt against the lot. The assessments are from the 2002 streetscape project. Member May questioned why we didn't waive the assessments, She will contact the Finance Director, Member May also noted we don't have the money to install a walkway, so what happens with the project if we cannot afford to do that? Staff stated the walkway would enhance the overall downtown appearance, Member May asked if it was agreed upon that we pay half the closing costs? If we are allowing for the excess TIF funds, she recommended the developer pay all the closing costs. She asked for the total cost ofthe closing costs, The EDA has to spend $15,000 to make the project work and we don't have the money, Regarding the design of the sidewalk, staff stated the design could be revised and place brick along one side only, and no benches, The developer would put lights on the building rather than in the walkway, The developer could place some flower pots in the walkway, Member Larson noted regarding the TIF money, the information states the City would have the ability to provide up to $64,517 to a qualified project. The portion the City would receive back from the County would be $23,871, Staff explained that is if a project is not awarded, Chair Bartholomay noted this would be good if we could at least break even, Staff stated the $64,517 would be granted to the developer. The developer would pay $38,500, and the EDA would pay for the walkway, the survey, etc, We would have property developed that has been on the books and undeveloped since 1992, Chair Bartholomay asked about the current costs the EDA would have to pay, Member Larson stated the $33,818 was spent years ago so we are in the hole that much, The most we would have to spend would be $36,878.23, depending on if we can negotiate the assessment, determine the true cost of the walkway plus any closing costs, Member May recommended they pay the closing costs and we will have to figure out how to build an inexpensive walkway, Members suggested re-negotiating the closing costs for the developer to pay all closing costs. Regarding waiving the assessments, staff spoke with the Finance Director and they are tied to the Pilot Knob Road project. Ifwe do not pay them out of the sale proceeds, then we need to find another funding source to pay the assessments, Member May asked staff to check on the interest for the assessments, It would be nice to put some money towards the EDA balance; more than $1,000. MOTION by May, second by Larson to re-negotiate for the developer to pay all the closing costs, make TIF funds available, and have Ehlers do a spending plan. APIF, MOTION CARRIED, 8. NEW BUSINESS a) EDA Workshop - March 14,2011 The EDA had mentioned to discuss the EDA deficit, a strategic plan to attract businesses, and discuss Chair Bartholomay's economic ideas, Chair Bartholomay wanted all EDA members to provide ideas, The Grow Farmington has done a EDA Minutes (Regular) February 28, 2011 Page 9 good job with incorporating many ideas. Member Larson wanted to discuss an EDA levy and how the funds can be used, City Planner Smick suggested discussing available resources, business retention and recruitment, targeted industries for commercial, technology, business friendly, and a marketing program, These would fit in with the six areas of opportunity, Member Larson asked how the comments from the First Impressions Survey are incorporated into Grow Farmington, Staff will also provide this and a comparison of all the studies that have been done, In the future, Chair Bartholomay would like to see aggressive comparability studies done with our neighbors as far as incentives. 9. CITY STAFF REPORTS a) Major Economic Development Activities - February Economic Development Specialist Hansmeier gave an update on activities that occurred in February. b) The Bridge (March/April 2011) - Economic Development Page This information was provided to the EDA. c) CDBG Update This is federal money that comes from HUD to the County and the City is a sub- recipient of the money. The City has the ability to set up programs for the money that meet the regulations ofHUD and the requirements in the CDBG program, There are currently discussions in Congress regarding cutting the budget for CDBG. Staff will provide more information as it becomes available. d) Elm Street Garage Update The owners have gutted the interior of the property. Remodeling of the inside is being done, Plans are in line to work on the exterior this spring. Old Rambling River Center Building There have been a couple interested parties. One party felt there was not enough parking available and for the other party, the EDA would have to pay them to make it work. Options are for staff to continue to work with Mr, Otten to purchase the property or look at demolition costs. Member May would like to see the realtor attend the EDA meetings to give an update on this property and what she is doing to market this property, It was suggested she come once a quarter. e) Roundtable Chair Bartholomay attended the LMC Conference this week. It was a great conference, He asked if we could look at taping the EDA meetings, especially if we discuss an EDA levy. He asked staff check with the City Attorney to see if this would be required. Staff noted this would be an added expense that is not included in the budget. EDA Minutes (Regular) February 28,2011 Page 10 10. ADJOURN MOTION by May, second by Bartholomay to adjourn at 8:12 p,m, APIF, MOTION CARRIED. Respectfully submitted, /-,. . F .~ . //,:'7 ~1Z7&Cb )?'7~0A../ Cynthia Muller Executive Assistant EDA Workshop Minutes March 14, 2011 Mayor Larson called the workshop to order at 6:30 p.m, Present: Absent: Also Present: Larson, Donnelly, May, Bartholomay (arrived 6:47 p.m.) Fogarty Peter Herlofsky, City Administrator; Teresa Walters, Finance Director; Tina Hansmeier, Economic Development Specialist; Lee Smick, City Planner; Cynthia Muller, Executive Assistant EDA Budget Discussion Staff hired Ehlers, the City's fmancial advisor, to separate the HRA and TIF funds. They discovered the TIF funds have a positive balance, and the HRA fund has a negative balance. The financial system only goes back to 2000 and the balance was negative at that time. It is possible the negative balance is due to an agreement between the City and the County for the Farmington Library. The Library portion was approximately $250,000. To determine the other portion, it would have to be prior to 2000, Staff would have to look through files in storage which would take a lot of time and we are short on staff, No matter what is found, the numbers are still the same. Looking at the future, the best way to deal with it is for the EDA to have a small levy of $25,000 - $50,000 for the next three or four years to reach a positive balance, Member May felt it was difficult to explain that kind of answer to the taxpayers. Finance Director Walters explained this came about because the TIF report balance did not match the City's fmancial system and was carried over year after year, Member May asked how the balance went from $490,000 to $543,000. Staff explained it included some things in the TIF area. The cash was combined and it is hard to segregate what is for what. That is what Ehlers worked on and found it was for the Library. Member May asked where the positive balance in the EDA came from, Staff recalled in 2006 there was one piece of industrial property sold for the Reagan Bus Garage, Member May asked if it was worth the time and effort to find more history on this, Finance Director Walters stated staff is very busy with audit, we are losing a person who worked over 40 hours a week and her work is split between two people. This would take a lot of time and research. The HRA is closed now, so the EDA has a negative balance, Member May felt we should levy something, but we need to get a better handle on the rest of the budget first. A plan needs to be developed on how to cover this negative balance. EDA Strategic Plan City Planner Smick provided a compilation of all the strategic planning efforts since 2007. Once all this information was combined, staff developed six areas of opportunity, When preparing a strategic plan, we need a goal and a policy (the six areas of opportunity). Staff compared the strategic plan with Grow Farmington. Regarding the economic development strategy, the EDA is the public policy planner, and looks at prioritizing, assigning and phasing the plan, The Grow Farmington group gets into more detail and is a framework for putting together action plans, EDA Workshop Minutes March 14,20111 Page 2 The businesses will be asked to carry out the action plans and the City will support the Grow Farmington effort and the businesses, The six areas of opportunity include: 1, Resources available to support Economic Development One resource is a business improvement district tax, Lakeville taxes commercial and industrial property to provide EDA funds, Businesses would be asked about this at a public hearing, There are also loan and grant programs available, Member May asked for a website on grant programs, The EDA could propose a levy. The EDA could add partners such as the school district for communications, 2, Business Development A, Business retention/expansion program A business that wanted to expand did not, because the fees were too high. It was explained to them that not all of the fees are City fees, There is a small business mentoring program available in the area, The Dakota County Technical College does offer short courses on ways to be successful. SCORE representatives have attended Chamber meetings. There will be action steps developed to let existing businesses know this is available, City Administrator Herlofsky suggested the Technical College could hold classes here for businesses once or twice a year, and also reach out to home businesses, The old liquor store building could be used as an incubator site, Member May stated a Community Council had been discussed at the Council retreat. She wanted to make sure the Grow Farmington continues, The EDA discussed having a Town Hall meeting once a quarter to keep the community in touch and also have a Town Hall meeting during the second quarter for the budget. Members suggested the EDA go back to a 7-member group with two Councilmembers and five at large members. Before advertising for applicants, it needs to be decided what they will do. Within five years we have gone from an HRA, to an EDA with at large members, to the Council serving as the EDA. Member May suggested making the transition at the beginning of the year. Between now and then a plan can be developed. A transition plan could be added as an action plan, With a separate EDA, they report to the Council, so the Council would still be in charge of approving an EDA levy, but the EDA can spend it. Also, a separate EDA would be required to have their own audit. Right now, the EDA is blended with the City. B, Business recruitment This area includes downtown, industrial, and commercial development. Delineation of downtown Commercial district, the creation of a downtown commercial overlay district, and downtown design standards are in place. The EDA would tell the Grow Farmington group what they would like to see in a business strategy, There would also be an opportunity for a broker tour, In the past, City Planner Smick took the seniors on a bus tour around town. EDA Workshop Minutes March 14,20111 Page 3 3. Business Friendly Currently we have business visits, ribbon cuttings, maps and listings, and a Business Guide, Member Larson suggested having goals for the business visits, One visit a year is not enough, There would be performance measurements set for all of the priorities. City Planner Smick gave several ideas of things that could be done to be business friendly. Members agreed that signage to commercial areas is important. City Administrator Herlofsky reminded members that City Hall will be hosting the Chamber's Farmington Brew HaHa on Thursday. Businesses providing refreshments will be recognized. 4, Create a Marketing Program Staff listed several things that could be included in a marketing brochure. The Grow Farmington group will be looking at a brand for Farmington. Member Bartholomay brought up having digital signage, Locations could be at 195th and Pilot Knob Road, and downtown by the railroad tracks, Advertising could be a way to offset the cost. 5. Technology There are many things that can be done with the internet, broadband, and the website. 6. Update Market Study Last year the EDA was still trying to decide whether to update the market study, Chair Bartholomay has reviewed it and did not see anything that would change. City Administrator Herlofsky suggested Council review each of these areas and pick out three priorities with suggestions for performance standards. Staff can then prepare an action plan with items that can be accomplished within the next 6 - 12 months, This should be ready for June or July and reviewed again at the end of the year, City Planner Smick will be writing the plan within the next couple weeks, Member May asked where does the EDA fit, and Grow Farmington fit? How do all the pieces tie together? City Planner Smick explained the EDA will not get into items such as flower baskets. That is a detail that would go to the management of people and resources, That is where Grow Farmington would fit. Grow Farmington is a sub-set of the EDA's strategic plan. City Administrator Herlofsky suggested doing an organization chart of all the little things going on, We have Grow Farmington, Dew Days, and all the little groups in town and put them in certain categories. City Planner Smick added we could have a manager manage where the pieces are falling and make sure we do not duplicate efforts. Chair Bartholomay noted one group in Grow Farmington talked about doing a community calendar, This would be done by the business community. The EDA is at a higher policy level. Member May felt the community calendar has to be managed by the City to have some neutral oversight. Roundtable City Administrator Herlofsky noted tires were slashed on City vehicles over the weekend. There is no inside storage available for vehicles, EDA Workshop Minutes March 14,20111 Page 4 The City received a letter from Mr, Clyde Rath regarding a parking concern downtown, Several downtown business employees park in front of the businesses. The City will suggest they use the public parking lot on 2nd Street. A watermain break occurred at 4th and Walnut Streets today. Finance Director Walters received a call from the Colby Group to set up a meeting, The City Administrator will also attend, Member Larson also received a call and they wanted to meet with him and Member May. Member Larson directed Mr, Colby to the Finance Director and only the entire EDA will meet with him, Member Larson was told they now have a bank that will back them. City Administrator Herlofsky will be talking with the City Attorney regarding options for the Deputy Registrar, He will try to get the State DMV and the City together, Member Larson suggested contacting Senator Thompson and Representative Garofalo. All of this will be coordinated, There will be a meeting with school district staff and one discussion will be using the skills of Mr. Skelly to help promote the community. Chair Bartholomay spoke with Mr, Skelly and he was very interested along with two School Board members, Their camera equipment is old and they would like to get their meetings televised, City Administrator Herlofsky has received a script of a short video to be made by the Mayor and School Board Chair highlighting areas of Farmington. He has been working with the school district on renting areas of the City Hall. More vendors have been received for the Farmers' Market with some products other than produce, There are currently a total of 10 vendors with leads on a couple others, Staff is waiting to see how much revenue is received from vendors before going to the businesses for sponsorship. The dates of the market have been extended by four weeks and will start on June 16, to take advantage of Dew Days. One newspaper has offered 50% off on ads, A few businesses have been approached about sponsoring ads and were not very receptive about covering the cost of newspaper ads, Staff is looking at reducing the sponsorship fees and list all businesses in the ads, There will be one or two nights for business nights. City Administrator Herlofsky stated the downtown businesses are not making large amounts of money. The more traffic we can get in town, the more it will help them. Then we can help each other. Economic Development Specialist Hansmeier noted the 305 Third Street building will be vacant at the end of March, She asked for comments on leasing the building again, City Administrator Herlofsky would like to be as flexible as possible in negotiating, An incubator would be one thing versus someone long term, This was discussed at the Council retreat and Chair Bartholomay stated the EDA would like to market the building for sale without a lease. He would like to have the realtor attend the next EDA meeting and have her come once a quarter, He understood we want to fill store fronts, but we do not want to be in the business of leasing, Staff noted we will still have to pay property taxes for this year if it is still vacant July 1, Then it will be re-assessed and it will be non-exempt for the next year. Chair Bartholomay wanted some open dialogue with the realtor at the EDA meeting with some real expectations. Member May stated the EDA would like to get her feedback once a quarter, One of the issues when the sale EDA Workshop Minutes March 14,20111 Page 5 fell through was putting the for sale sign in the window. If she was the tenant, she would not have wanted a for sale sign in the window either. The EDA decided to try to sell the building first and re-evaluate it later, It is hard to sell it with a tenant in the building. Regarding the Me Vicker lot, the Council will need to adopt a spending plan which authorizes the spending of the TIF funds, This will be at the March 21, Council meeting. After that, the EDA will approve the contract for private development. Member May asked about the actual costs of the sidewalk and if it could be less than $15,000. Staff stated it could if it was just plain concrete and no brick pavers, benches, etc, Lighting will be very important along the sidewalk, Chair Bartholomay asked if closing costs have been discussed. Staff has talked with the attorney and the closing costs are $200 - $300 and not worth re-negotiating, The realtor listing agreements for the McVicker lot, the Riste lot, and 305 3rd Street expire March 31. The listing agreement for the old Senior Center expires April 30. Member May noted the EDA had discussed choosing a realtor within the community, But it can also cause issues when a realtor is representing a lot of entities, Chair Bartholomay stated there could be a downside to using a local realtor, Member May stated she is representing most ofthe properties in the same area, Staff stated there are a number of realtors that we have contact with. Member May stated staff is asking about extending the contract. Staff noted the direction from the EDA was to choose someone local. Member May recalled last time they were given several realtors to choose from along with their fee, Staff will provide a matrix for the next meeting, The agreement for the Me Vicker lot would have to continue as we are close to closing. Chair Bartholomay asked about the status of the ice cream business. The owner is reviewing the lease and working on plans, Chair Bartholomay asked if someone comes in and Tina is gone, and they ask for your card, it would be nice if the receptionists would call Lee or ask them for their name and number, Member Larson stated someone was in the other day asking about different things around town, He was given Tina's card, but the receptionists did not know who it was, This would be a way to track inquiries. Chair Bartholomay asked if there were any issues with the foundation of the old Senior Center building deep in the ground that would cause mold. Staff was not aware of anything, City Administrator Herlofsky felt it would be best to demolish the building and sell the vacant land, Member Larson stated it was discussed at the retreat to fix the building up, strip the inside, and paint the outside and market it that way, Member May stated they discussed tearing up the carpeting and tearing it down to studs if there are issues with the walls, She would like an estimate on the cost to do this, The EDA had discussed a limit of $5,000. Potentially it could have a future City use. Staff noted it is $3,000 - $10,000 for mold abatement. The EDA would like a detail of that cost. Chair Bartholomay stated the EDA had discussed using it for the downtown liquor store, Member Larson had notes from the retreat for the downtown liquor store to get out of the lease, look at the old senior center and if traffic improves at Vermillion River Crossing, look at that area. Staff will look at how much it would take to refurbish the building. Member Donnelly felt it does not matter what realtor we have, it is a tough market and they are not attractive properties. They are all motivated to sell, Regarding the downtown liquor store, we have to get out of the high priced lease, The current location is not a long term solution. Member May felt we should not be in the liquor business, Member Donnelly noted Lakeville's liquor stores provide $1 million to the City. Member May felt there could be potential in other areas if we got out of the business. One of the EDA Workshop Minutes March 14,20111 Page 6 hardest things to do would be to measure the opportunity lost. She felt we have more opportunity to gain and would like to see us make a change while we still have some money. Our immediate neighbors built right on the borders, we don't own the building, we are in a different place than Lakeville, So let's be different and open up to private development for liquor sales, Member Larson mentioned with restructuring it can be more profitable, City Administrator Herlofsky felt it would be a bad decision for a community of this size to give that up. Given the growth we had a few years ago, we would be looking at a different picture, Member May felt we do not have any business selling liquor and also felt we should not be in the solid waste business. City Administrator Herlofsky stated the City does have the responsibility to collect garbage, How to do it is what we are debating. Member May stated we have some opportunities, If we had Trader Jo's here the traffic would drive right by Apple Valley and Lakeville stores, MOTION by Larson, second by May to adjourn at 8:37 p,m. APIF, MOTION CARRIED. 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Il = Q. ! ci ~ w w j 'ii .... N ell ell 0. ~ ... 0 0 ti " 0 0 ~ 0 w w 0 (J) .... ... .... u. u. .... '" "6 Q :5 :5 0 0 0 0 0 '" '" ell II 0 0 0 0 0 <') <') 5l- e c:i c:i ori ori c:i ori ori ~ ~ a:: .... .... r-. r-. ~ '" 0 '0 N N co co .... ~ c > ~ E ~ 'E ~ ... ... ... ~ .... .... ... ... .... 0 0 0 0 t:! t:! t:! 1'5 ~[N ... ~ .... :::E ell ~ ~ ~ ~ ::l .<:: () ~ Ui *I~ j ~ .... N ~ b "" Il lJ g ... ... .... Z .<:: .... ... .... .... () lil 7Q. City of Farmington 430 Third Street Farmington, Minnesota 651.280.6800 . Fax 651.280,6899 www.ci.fannington.mn.us TO: EDA Members FROM: Lee Smick, City Planner AICP, CNU SUBJECT: Economic Development Strategic Plan DATE: March 28,2011 INTRODUCTIONillISCUSSION The information shown as Exhibit A contains the policies and strategies that were discussed at the March 14, 2011 EDA Workshop. At that workshop, staff requested that the EDA determine which priorities would rank 1 st, 2nd, and 3rd in order to determine the tasks for staff in the next 6 to 12 months. Staff would like the EDA to rank the priorities on Exhibit B with flags that will be provided at the meeting on March 28th. Intentions of the priorities can be found on Exhibit A. After the rankings are tallied, staff will draft the Economic Development Strategic Plan. ACTION REOUIRED Rank the priorities with flags designating the order of importance that staff will carry out in the next 6 to 12 months. Respectfully submi oti- Lee Smick, City Planner AICP, CNU Exhibit A Areas of Opportunities: Red Text - Working on/Completed items Blue Text - Proposals to work on Policy-I, 2, 3,... Strategy - A., 8., C"... Action step - i" ii., iii.,... 1. Resources available to support Economic Development A. Work with EGC, FBA, School District, Rotary, etc, B. CDBG Business Reinvestment loan/grant program C. CDA Redevelopment Incentive Grant (Riste building) D. CDBG Program E. Staff F. Business Improvement District tax G. Small Business Development Loan Program (DEED - Industry) H. DEED Redevelopment Grant Program I. Metropolitan Council's Livable Communities Demonstration Account J. Levy K. Potential new staff L. Transition to EDA 7-member group 2. Business Development A. Business retention/expansion program 1. Business Outreach Program 11. Continuous Communication with Existing Business Owners iii. Focus on Retention and Expansion of Existing Businesses a. Business visit and interview b. Tracking of "red flags" from businesses: how should requests be handled, who responds, when follow-up occurs, outcome of follow-up visit c. Measure success of BRE Program IV. Small Business Mentoring Program v. Shop Local Program - 3/50 Project vi, Community Council- GROW Farmington vii. Grow Minnesota Visits 8. Business recruitment 1. Downtown Development a, Delineation of downtown commercial district b. Downtown commercial overlay district created c. Downtown design standards d. Master plan for Rambling River Park e. Farmer's Market f, Incubator Spaces - 305 3rd St g. Marketing buildings for sale h. Buxton Leakage Study 11. Industrial Development a. Industrial Park (West side of PKR) has been comp planned and zoned for industrial uses. A preliminary concept plan has been prepared. b. Install infrastructure on Fairgreen Avenue to attract industry. c. Industrial Recruitment Strategy iii, Commercial Development a, Business Recruitment Strategy What types of businesses do you want to attract? What specific businesses will be recruited? How will the initial contact be made? Where should the initial contact occur? Who should make initial contact? What materials should be included in marketing package? When and how should follow-up occur after the initial contact? Market position statement - types of businesses to attract Identify business wish list - targeted markets Comparability study Assemble recruitment and marketing materials Generate leads Court prospects b. Components in Place at time of Recruitment Identification of the optimal tenant mix Inventory of available building space or developable sites Business recruitment strategy Marketing package promoting the advantages of the community c, Promote Tenant Mixture Browsing d. Provide incentives to locally Owned Business - Funding? e. Attract nationally known businesses (Starbucks, Walgreen, CVS) f. Business Owner's Forum g. Realtor Day h. Broker Tour 1. EDA Tour 3. Business Friendly A. Business outreach program visits B. Ribbon Cuttings C. Properties available map and listings D. Business Guide E. Commercial/Industrial Permitting Process Checklist F. Commercial & Industrial Development Guide G. City Brochure of Commercial/Industrial Opportunities H. Community Development/Event Committee I. Home Occupation Permit Brochure J. Business appreciation lunch/social K. Meet the Merchants campaign L. Business spotlight at City Council meetings M. Improve Farmington's transportation gateways and corridors - GROW Farmington N, Improve the appearance of Farmington - GROW Farmington O. Install signage to commercial areas - GROW Farmington 4, Create Marketing program A. Marketing folder/Business outreach program brochure Marketing package inserts a. Map of retail site and trade area/Sell Sheets b. Map of retailer's potential customers c, Retailer match report that compares the site's trade area characteristics with the retailer's locations in similar trade areas - Metro MSP d. Demographic and psychographic profiles of the households in the trade area e, Contact information for the person at the retailer who has location decision responsibilities f. Trade area geographic definition, demographic data, and economic data g, Vehicle and pedestrian traffic volume h. Mix of existing retail, services, housing, etc. 11. Define Brand - GROW Farmington a. Determine if brand is citywide or for commercial areas only. b, Create a "brand" or new image for Farmington that revolves around one central theme. c, Define key positioning messages and images. d. Align consistent messaging about Farmington with other marketing partners such as newspapers, calendar, Dakota County Fair, Dakota Regional Chamber, etc.. 5. Technology A. Partnership with Dakota Futures: Future Intelligent Community Initiative B. Dakota County Broadband/High Speed Internet Committee C. Dakota County Goog1e fiber application D, City/County Manager's Meeting E, Locations of WiFi, Broadband F. Ultra high-speed broadband taskforce (State) G. Nixie H, City Website I. Develop City Technology Task Force J. Work with School District #192 K. Facebook L. Electronic signs 6. Update Market Study A. Maus & McComb Study 2007 B. Market Study updated to 2010 with focus and information on identified businesses- location/business model and corporation contact information Exhibit B Please place 3 flags on the priorities you would like staff to focus on in the upcoming 6-12 months. Red Flag = I st priority Orange Flag = 2nd priority Yellow Flag = 3rd priority Staffwill tally priorities and we will discuss the Top 3 priorities at the meeting. Areas of Opportunities Place 1. Resources to support Economic Development Flag 2. Business Development: Place A. Business Retention/Expansion Program Flag Place B. Business Recruitment Program Flag Place 3. Business Friendly Flag Place 4. Create Marketing Program Flag Place 5. Technology Flag Place 6. Update Market Study Flag Comments: 7/ /6 City of Farmington 430 Third Street Farmington, Minnesota 651.280,6800 . Fax 651.280,6899 www.ci.farmington.mn.us TO: Economic Development Authority FROM: Lee Smick, City Planner AICP, CNU SUBJECT: GROW Farmington DATE: March 28,2011 INTRODUCTION I DISCUSSION The 3rd "GROW Farmington" meeting was held on March 2,2011 and included approximately 20 people in attendance, At the meeting, the attendees were directed to three tables which were divided into topics including Marketing, Events, and Image as determined under Promote Farmington. Brand Farmington and Unite Farmington were not a part of these discussions. The attendees discussed each category (marketing, events, and image) and determined which items were important strategies as shown on the attached matrix (Ex, A). Under Marketing (Ex. B), the group chose two strategies including the need to focus on local residents to encourage shopping and the insertion of events into a consolidated calendar. Action steps under the local residents focus includes creating a brand such as "My Farmington" and promoting it through placards, City Council business visits, and creating an awareness campaign. Responsible parties include the creation of a Brand sub-committee where regular attendance and expertise on this topic from the business community is crucial. Actual dates for completion will be determined by, the Brand sub-committee. Action steps under the consolidated calendar include the need to name a calendar administrator and determine the technology to dispense the information. Dates of submittal to the calendar will be determined by the calendar administrator. The second category, Events, consists of two strategies as well. Those strategies include the creation of a database listing groups in Farmington, such as the boy scouts, Rotary, and youth organizations where contacts could be made for various activities. The database should be created soon in order to utilize the contacts. The next strategy consists of the preparation and coordination of a bike ride event. Action steps are forthcoming. The fmal category, Image, also includes two strategies. A clean-up day is proposed for the business community to coincide with the Pond Clean-up Day on April 30th. Action steps include the creation of flyers, the connection to groups, the sweeping of City streets, and the creation of an adopt-an-area campaign. Flyers, news articles, and group connections will be completed in March and the remaining items will be completed in April. Another strategy consists of the installation of hanging flower baskets and potted flowers, The Farmington Business Association (FBA) feels that this is an important issue and proposes to hang baskets in the downtown area as well as locating flowering pots on the intersections along Elm Street from the Rambling River bridge to TH 3. The FBA already has sponsors for the hanging baskets and sponsors for the potted flowers are also being gathered. The FBA will also provide a stipend for a part-time City employee to care for and water the flowers, Additionally, the FBA would like to assist in purchasing banners for the downtown and possibly the northern commercial areas to replace the old banners in the downtown, The City will hang both the flower baskets and banners. The next step in the GROW Farmington process involves a fourth meeting where attendees will review the Brand Farmington and Unite Farmington priorities. The group will look for important strategies and determine two strategies for each priority. The group will also generate action steps associated with the strategies. The next GROW Farmington meeting is March 30, 2011 at City Hall in the Council Chambers at 5:30 PM. ACTION REQUESTED Review and approve the City's involvement in the abovementioned GROW Farmington's Strategies and Action Steps. 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Fax 651.280.6899 www.ci.farmington.mn.us TO: Economic Development Authority (EDA) FROM: Tina Hansmeier, Economic Development Specialist SUBJECT: McVicker Lot Update DATE: March 28, 2011 INTRODUCTION/DISCUSSION Staff continues to work with the interested buyer of this property, Below is a list ofthe work that has progressed since the February EDA meeting, 3D-Working Day Permit Review Process Pre-Application Meeting took place on 3/16/11 Anticipated timeline for plan submittal, closing and groundbreaking: Spending plan/resolution approval at Council Developer to submit Site Plan EDA approve final Contract for Private Development Sale closing Building permit issued Groundbreaking March 21 April 14 April 25 May 17 May 25 June 20 Staff created three different design options for the proposed walkway which are enclosed. The estimated costs associated with each of the designs will be provided by addendum prior to the meeting on Monday. An elevation for visual representation is also included. City Council approved Spending plan and Resolution authorizing the use of excess TIF funds at its meeting on March 21. Staff worked with the City's Tax Increment Financing Attorney, Dorsey & Whitney, to develop language for inclusion in the Contract for Private Development that is specific to the EDA providing excess TIF revenue to developer, It is proposed that the assistance will be provided in three equal payments to developer at certain defined performance measurements, The EDA's Attorney revised the Contract for Private Development. The latest version ofthe contract has been provided to the Developer and is currently being reviewed with the Developer's banker. Staff received the ALTA Land Survey from Jacobson Engineering, Staff discussed the streetscape assessment amount with the Directors of Finance and Engineering. ACTION REQUESTED This information is provided for discussion purposes, no action is requested at this time, Respectfully submitted, Tina Hansmeier, Economic Development Specialist .~ fl o. I f ~ } ,. \j! \.'..: . >II " '( ~). . ;'./f'l.' 1 't .. ! i. !" ~'-~'~~':-~'~I."~,".....~-.-;" ~ ," 1 j/' .~,,.....~,~....,,,,~~;~~~'l.~.Xi~~;'}.jf>'..4t~""';';"''''':~\~_'~:i','t'Ol.'.Jt~ ""'~t;~~:I"~.9'~.~"~" ~.~.,,,,,,--..,t; ~~~'-=~-If II ~ -;'~."~~' ~ ~ ~ ~:Lr.'!'~~~.~;v.;t~=~~~~":1~~:;.""";;- ~, , 1 1 '~ 1 ~ll ! f 4 ~ r;~ ,j lr" 111~-t I. ~ '1 \ ,. l' I ,1 ! \ '!: \: (;:t ....../ - 1- _11= ----. - - - 1- ----. - -_1 ;-, - - -_J -, - - - 1- - I- I- - - 1- - 1-1- - - 1- - I-~= - 1- - - - 1- - - ----. 1- - 1- =- ----. I;:=: "\ 'J I--- I--- 1_ - ~I- I-- I--- I-- - - 1- 1-- -- - 1- _ I--- - 1""-,_1- 1----1 I----J - 1----1 1- I- I- 1- I- I- -,....:z~ 1- 1_ - - - 1- 1- I_ I- - 1- 1- -1- -,--,- - ----. - 1- I_ I--- - I""- 1----1_ 1----1 1----. - -----. 1- I_ i--- --' r--- ----. 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'5:; j r~j~ Ji; N~ tllJai ~ ~;~!ft J [ii!; f 'II :f ~ !Jr' t=. j& db C'l o,,p L"".fl ~.fl2"l1<l!b ~ THIRD STREET -z- ?a.. City of Farmington 430 Third Street Farmington, Minnesota 651.280.6800 . Fax 651.280,6899 www.ci.farmington.mn.us TO: Economic Development Authority (EDA) FROM: Tina Hansmeier, Economic Development Specialist SUBJECT: Former Senior Center Building (4313rd Street) Improvement Costs' DATE: March 28, 2011 INTRODUCTION The City-owned property formerly occupied by the Rambling River Center is currently listed for sale. At the March 14 EDA Workshop, the EDA requested staff provide detail on the cost to fix up this building to make it more attractive to a buyer, The current list price for this property is $192,000. The Dakota County's current year estimated market value for this property is $192,100. DISCUSSION/BACKGROUND On February 1, 2010, the City received a proposal to purchase this property. The proposal included an extensive list of work items the interested buyer indicated were necessary in order to make this building lease ready for a retail tenant. The interested buyer originally estimated costs to make these improvements in the range of $194,000-$204,000. At that time, the City's Building Official, Fire Marshal, Engineer, and Economic Development staff reviewed the proposal and determined that the listed improvements and associated estimated costs appear reasonable. The following is a summary of those items: Imorovements . New roof . Repair of crumbling lower exterior wall . New furnace . New cooling system . Inadequate return air ducting . Electrical (wire removal and breakers) . Bathroom upgrade to ADA Standards . Replacement of ceiling tiles (water stained, do not match, sagging) . Interior remodel . Flooring . Fire Suppression (required per code for new occupancy classification (i.e., restaurant or retail users) o Larger water pipe needed to service sprinkler system o Requires street, cum, and sidewalk demolition and repair . Support posts - there is a twisted support post in the front foyer and several posts with large splits . SAC Units More specific detail is attached for your information. Later that year, it was brought to staff's attention that there was visible mold on the carpet~ Staff obtained estimates for mold remediation work from Peer Engineering and Advanced Environmental Restoration as follows: Peer Engineering Option 1 $5,000 Remove carpet visibly impacted with mold (approx 2/3rds), hep- vac beneath those areas, spray microbial disinfectant where carpeting was removed, and take remediation air samples after remediation work identified has been completed, Option 2 $8,000 Remove ALL carpeting, hep-vac entire floor area (kitchen flooring included), apply anti- microbial disinfectant, wipe down horizontal surfaces, and perform air testing before and after remediation, Remove and dispose of visibly water damaged ceiling tiles (4 areas with stained tiles). Option 3 $10,000 Option 2 plus cleaning of ductwork/ventilation systems. Advanced Environmental Restoration, Inc. Option 1 $3,400 Remove carpeting and water/mold damaged ceiling tiles, hep-vac all horizontal surfaces, disinfect affected surfaces; encapsulate entire area with anti-microbial product. Recommendation was provided that air testing be completed by another company and to have the air ventilation system cleaned, Option 2 Unknown Option 1 items plus air tests and ventilation system cleaning. Peer Engineering could perform the air samples and testing and subcontract the mold remediation piece to a qualified mold abatement contractor (Le" Advanced Environmental Restoration), Advanced Environmental Restoration actually performs the remediation work and would subcontract the air testing to another company, Advanced Environmental Restoration recommended having Peer do air sampling and to have the duct work cleaned by a company that specializes in mold remediation of ventilation systems. Staff is also in the process of researching other opportunities that may exist for this property that can be discussed at the meeting, ACTION REQUESTED This information is provided to for discussion purposes; no action is requested at this time. Respectfully submitted, Tina Hansmeier, Economic Development Specialist FEB-01-2010(MON) 14:57 Otten & Seymour (FAX)9527363400 P.001/012 , ~ PAULotraN,1iI Ju~ K, SijYMOUR. iii PAU'!-.A. M. JOSBART ERIC r. QUOl'! RICHARD p, OHLBNlillm.,G MrCHAllL 1.. LANOBElt P.A. ag..!,,,! EN S' "~.;i:~", --ll~ EYMOU,R Fax Transmittal FOJ;111 : DATE: February 1. 2010 TO~' , Tina Hansmeier - 'Dept. of Economic DevelQpme>>:t :' COMPANY: City ofFarmin~on ' BUT7l$vi1.ls otftce 108 Ptafesslonal Plam 1601 E9$\:. Hiah\\lay 13 BumavlIlc., MInno:sotI1- 55~J7 T,*pho1:l.e (952) 736~3m' F,al;Bimilo: (9~,2) 736.3400 FAx NUMBER: (ft51) 2.00- to,gCC9, o Farm'ingtotl Office NO. OF P AG,ES: 311 OBk Street " Farmington, MInn~tll 55024' To:lepl:w1:l.e (651) 463-1151 D Mi~apoUs Ot/lce FROM: 1150 Flout Exchange Building ;HO Fourth Avenue Scum MInneapolis, Minn~tll 55415 To:lo:prw!=>l!l (612) )79-9~.s RE: \ 1- (~cluding cover) , W. Paul Otten Otten & ~eymour , 413 Third Street bui1din~ 'Iryou have questipns or concerns. please call W. Paul. Otten at (952) 736- 3300. ' , '" QuaUfit:cl NsutTa1: under Rula 1.14 of ehe Minnesota , Gene1"at Rules of PTI1cti.cfiJ The. infoimatioD.containedin this. tacsiml1emessageJs co~dential and intend,ed only for the ,use oithe individual or entity'named above. If ' the'reader of this ,message is nqt the intended, recipient. you are hereby notified that any,dissemin~tion. distribution'or CQpying of this , , communication is strictly'prohibited. If yo.u have received this, communicatio~ in error. please'notify us- immediately by telephone an~ return the original,~t\'ssage'to us at our B~ville ad4ress via the U.S. Postal Service. ' _~ ,,~~ Ii ~ ..,);.~: 1'>~~'~~/~"~;:;'~~:f,I~<:%;':~\~~:::" ,-;:t~~:" I f[.~":' .......":;':.... ~ ,,-(lx~:V:~.' ~);~~_. . " ~ -~<~\'6 :\.>~~<~ :-.' ":; ~~;~:;"~:.'. ~~>l ~~>?" '0' ~~";":\/;' ~:~;:::'~>... ' .; ',:~/~'?'"~~~' ~r~~,,">.~~~yv :;.<' . ',' FEB-01-2010(MON) 14:57 W. P/\l.1l,. OrrEN (< JULIE K. SEYMOUR >{I PAlJLA M. JOSSAR'1" ERIC T. OLSON RrCHAIlD p, GRUNBERG' M,JCRAEL L. LANDIlR, RA. Bums~me Office. 108 ProfCSJiol1lil Plaza' 1601 East Highway 13 BUmsville"Mif1fIesota 5533'7 Thlephone (9S2} 736~3.300 FlU:!limi1e (9SZ) 736.3400 o Farm!11gtotl Of/ice 311 Oak Street , , Fannitlit=l Mlm\eaom. 55024 Thlephone (651) 463,715L o :MinneapoZi's OffiCI! U5a Flour Ex<;h\lni" Builritng 310 Follfd, Avenue SGuth '., Minn~PI;llii. Mi1'tt1.elOta 55415 TelePhone (612) 319,9445 >ll Qualified Nmftral.,~. Rule 114 qf *'he'Minnesota Gene.rctJ. Rules of Prm:rice Otten & Seymour (FAX)9527363400 P,002/012 O$'~rr'''T E N 's" ~.~;~~ -~ E'YMOUR , VIA.FACSIMILE F~bru.ary It' 2010 . Ms. .Tina Hausmei~r ,City of Farmington , Dep~ent ofEeonon,ic Development 430 Third Street F~gton, MN 55~ . Dear Tina: ' Attached is' the report fronx the inspector regarding 431 Third Street; fo~er1y the Senior Center. " . , TJ;le report l;)onfirms what I belieye everyone 'thought - the building requires extensive work.. . The exterior requires a new roof and significant repair of the Cf\JII1bling lower walls. " The interior requires a new tbrnace fo~ the front part ofth'e building... (The. newer. furnace hi the ba(:k is ~ne.) ,It requires a cooling system for the fro~t of ,the building. (Cw:rently.the front of'the b~i1ding has nQ AC.) It may require new support posts. (It is diffic~lt to ,say at this point because the building previously ha~ a flat roof .and affic ~ess could not be found so we cannot see . . the area in'between thf;lold roof and the. new roof.) The entire building 1i~ .inadequate return air dui:ting. The building req1;1ires electrical work including '. we removal and breakers. It needs smoke de~ectors and apparently a '. . sprinkler system is required pursuant to the fire code. In order tp install a . sprinkler system, a lafger water pipe would need to be instal1~d from .the street to the inside of the building. Thill will requh:e stI:eet, cUrb and sidewalk . -~ . - demolition :an~ repair: -The-existin-g-watenneter~d pipe 'currently require a heater to p~event the pipes from free~g.due to the l~ck of insulation. ~ bathrooms are not up to ADA standards .and mU&t be demolished and re.:.built. Mpreover, the. interior'requires ~ c~Ii1plete remodel. The floor and carpet look decades old and need to be replaced. The ceiling tiles are water stained, don't match, are ,sagghlg and require replacement. 'WaJ).s need to be tom dOwn ,because of the wayth~ space'is carved up. '" . FEB-01-2010(MON) 14:58 Otten & Seymour (FAX)9527363400 P,003/012 . .~ Febroary 1, 2010 PftgtJ Two , Wi~ all of the work th8.t.is required to ll1a;ke the building ~tructUrally' ,so:ond, 'withput lealqi and . , ' 'with heat and air conditipning, with a. sprinkler systenl'which'requires a new water line frOm the street, to ,the buildmg. as well ~ all ofthC),co~metic changes necessary, I believe the building' , CUlTently ha$ yery limited:value. On ti;>p of the government required sprinkler system and , ,hathroom' updates, there are also more than $5,000.99 in SAC chin-gei from ,th~ M~tropolitan Council and $1,400.00 ftOIJ,l the City to bring the larger water line to the building to, ., ' , , ~co~odate the s~er system. Th~e are, on top, of~e permit charges. ' ,. While 'I would like to 'move a retail ten~t to t4e building, 'and th~reby put,the bUiI~g back on the tax rolls,,.! mu,s.t move quiclQy or lose the opportunity. I would be willing to pay, $50,000,00 , ,at tbis'time f~r ~e building. Let me know thoughts., : Verytnily yours, , : W. Paul Otten , WPO/mlo " ;~'x:~~~;;:;1~:>:::~>('{ ~.;:~~t:'~'.~' . :.:. : .:: ;,,::;;;~~;~;'zf:~~:~;:;;;%:~:,~f - ~t.:(~0:;~3:; .",.~;;;,C('i ~.:. .;~t~,~);;:,l~~D5;~: ~,::.,;,~~<; FEB-01-2010(MON) 14:58 Otten 8; Seymour (FAX)9527363400 P.004/012 INSPECTI()N I{EI?ORT Property: 431 3RD ST., FARMINGTON, MN Prepared for: PAUL OTTEN Home fnspeotlQn by Brian Soanlan on 01121i/10 HomeTeoh Inspet:tionst LLC 16445 Klngswood Ct. 1i72-750-15oo J.Qkevllle, MN 55044 FEB-01-2010(MON) 14:59 Otten 8; Seymour (FAX)9527363400 P,005/012 HomeTech Inspections, LLC 16445 Klngswood Ct.! Lakevllle, MN $5044 Business Phon,: 612-150-1500 E-Mail: InspeotQrbl'lan@hotmlfll.Qom CONSULTATION REPORT Inspector: Brian Scanlan Property: 431 3rd St., Farmington, MN Client: Paul Otten 1601 East Hwy, 13 Bumsville, MN 55337 01/26/10 Lakeshore: 8 Manufactured: Agent: City of Farmingtoll Area: Small Town Building Type: Oomem/a BId, Age: 90 Yaars Levels: 1 Street Surface: Asphalt Street Type: City street House Faces: Wast Garage: None Space Below Grade: None Soil Oondition: Frozen Snow covst'ed Sky: Cloudy Precipitation: None Temperature: 10 Start Time: 3:00 Client Present: ~ Owner Present: Agent Present~ X Oooupied: ~ Water On: Eleotrio On: X Gas On: X COllsullnll(JlI Report 011 /1:51 :{lcJ fJI ,F::\Jrnlli~Jt(lll, rvlN JWJlJdlY 2G, 10 COMERC/At BLD. INSP. CONSUL TA nON Purposs and Soope: Pre..purohl1Se Inspection of visible Interior & .merlor componants of commercial building, Limitations: This in!ilpectJon Is of visible components Bnd is non-i(lvaslve & non-detstructJve. Findings or Observations: EJderlor Heavy a{TIf)I.Jnt of Ice dam along SClUth edge of roof indicates poor Insulation or hear escaping intedor space & Into the attic. Insularlon Is likely vet'y Inadequate & should be Inorsased. MUltiple stains '* re09nt leakage into InterIor space indioates that the 11)Of wIll likely need to be replaoed, No aaoess was found to the attic space to view the sheathing, blJt it is lIkely that you wDuld find some damaged sheathing in a buildIng of thl$ ~ge and/or Toof bo8.tds with gaps betw(len the boards that are too large and would requIre the whole roof to be fe-Bhflathed when fS-roafing, A re-raof of thIs sIze could cost between $25,000-$80,000, The cost could rise sfgnificantfy If there is dscay of Sheathing or framIng Issues. Th/il(e Is consIderable deWloratlon of block an{f mortar on' the lower portion of the walls along the sidewalks, Recommend repairs by a qualified masonry contractor, t1stlmated repair cost: $5,000.$10,000, InterIor There is a twisted support past in the front foysr of the buJfdlng and several posts with large splits (1'1 them. Recommend consulting with a stnIf;:tlJaJ engineer or qualified contrac:tor to determine If the posts ate overloaded and/or need replacement, Thti# fumac:e Is the front portion of the building Is 30+ years olcJ & in poor condition. Reaammend immediate replacement of the furnac/il. Estfmated cost $6,000. Cost of ductwork cottamlons would bfJ additional cost. There Is no central AC in the front section of the building, only a small wall unit which is very Inadequate for the space. Reaammend installing Ii second AC compressor/oondensor Off the roof to air condition the space, Estimated cost $5.000. Both fumaCfJ systlifms have Impropsrlinadequate return air duct/ng. Recommend repairs by a lic/iIfIsed HVAC contraCt()f, ~01 0 HOrtl$Tech Inspections, L.LC This report ia for the sola use 01 Paul Otten. 0112911Q HomeTach Inspections. I.LC assumes no nabillty to third parties in conn$ctIon with the consultation and report, PSQ910'2 FEB-01-2010(MON) 14:S9 Otten & Seymour (FAX)9S27363400 P.006/012 COIl~;llH,)liOIl Report all 1\;31 :31 d SI., F.'lrmlllqtoll, MN ,Jaliucuy )6, 10 J:ler;:tdca/ sub-panel: thef"@ are open holes whElre /;Iretikers are mIssing. ELEOTIGAL HAZARD. Recommend correcti1le repalrs by licensed e/ecttfalan. Kitchen: multiple eJer;:tiaal wires need to be rtitmOIlOO from missing appJiStlces, Smoke deteators should lJ9 imtalledlfeplaC6d per code for fire safety, Water meter & WaRtf pipe: the water line & meter are an an outside wall & could easily b$ pIOne to freezing & breaking, Rscommend con$ulting with a plumber for correction, There arE! multiple stains on csiling tile$lndloat/ng a leaking roof system. Roof is covered with snow & ice & attla ar::cess could nor be found, It Is likely that the roof would need to be repleaed, A re-roof Of thIs sIze could cost batween $25,000-$30,000, The cost could rise significantly If there is decay of sheathing Of ftamlng Issues. Both bathrooms, mens & womens, do not appear to meet current handicap requirements, BathlWm remodeling could CO$t $5,000-$10,000. each, Ctmcfuslons: This buift;fif/(J will reqUire extensive repairs & remodfi./ling to make It functIonal as wel/as marketable to a tensnt. Recommend getting firm estimates of repairs from qualified contractors prior to making a purchase elflcision, ~010 HorrteTech Inspections, !.!.O Tl'lIs raport Is for the sole usa 01 Paul Otten, 01/29/1 (I HorrteTeeh Inspections. LLC a&eumes no liability to lhi~d partlesli'l oonnec1Jon with the consultation and report. Pagfl:!!of2 FEB-01-2010(tWN) 15:00 Otten & Seymour :.:'0 '::"',. (FAX)9527363400 P,007l012 ... 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",,0 " , "IJ '< 'I'..: ,: ~:', :.. ,;o;i::2 I s i t Il: f B I t .s& 1 vG ~ -J i c 0 g &1 c i == J I CD I I i .... c;, . . - FEB-01-2010(MON) 15:02 Otten & Seymour (FAX)9527363400 P.Oll/012 Ie) I I I u.I c 1 I := ;:;fi;iF~ /?;~'ik:~~: ~~'k;: ',:' :,;: :',f ';\ :~~:;~{i;i.}.J;~;;~' I)kJ'.,,"i"'''''~ ..'.....~ I.. I B 32 I i - .c ,fg) i t- -1- dJ I ,Ii! '. I J I i. lilt ItI i ) i ... Q FEB-01-20JO(MON) 15:03 Otten & Seymour f 8 ... 1iI I 8 J ~ I f ~ '0 t J (FAX)952B63400 f 1 ~ I ! "8 j I 1 li ~ I j I P.012/012 tl I ~. j t,' r ~im_-- i 's I I '5 ~ co I C) i .... b FEB-08-2010(MON) 17:06 W. PAUL OrTBN lit JULlS K. SSYMOU1\ (I PAULA iv{, ]O!lSAltT WO T, OLSON RIOHARD P. OHulNBBRG MICHAEL L. LANOlm. P.A. Bu7'fl.S,nlk Office. 108 Prof<m\Qnfl! p,-- 1601 ~t MIghWllY 1J Bumwllle, MitIrlesota 55337 Telephone (952) 736-3300 . Faeslmi1e (95,&) 7Ji'l-J'fOO D Ftirmington Office 311 Oak Street FlU"minamn, Mi:tl.t1e&Qta 55024 Telephone (651) 463-7151 D Minneap()/.is '~e. 1150 Flour Exolumgc BuildiIlIl 310 Fouti:h Avenue Souch 'Minnr;apoli$, Mlnnes'ltlS 55415 Tetephon~ (i'lll) .379.9445 III QuaUfied Nsutt'al under Rule 114 of the Minnesota QeneTCit aul~ ,q P7'ac~e Otten & Seymour (FAX)9S27363400 . Q2'Ofli"r E. N: SEYMOUR , DATE: TO: COMP~: ' , FAXNUMBER: NO. OF PAGES: FROM: RE: ..:..~v ",' t "~,,, (~ ~;J 1J. 12,_, Fax Transmittal Form Februmy 8.2010 Tina Hansmeier - Oem!: of Economic Development 'Cit( of Fanningmn (651) 280-6899 ' _3 '(including cover) W. PaUl Otten 'Otten, & SeYmour ~ 13 Third Street building If you have questions or concernS! please call W. Paul. Otten at ~9S2) 736- 3300. .' P.001/003 The information contained in'this facsimile message is confidentiai a.nd - -intendedo:iilyfor theo tise ~f t1ie:m~iVii:lUir6ren#ty, nari1edabove:.' If the reader of this message is not tQ.e intended recipient, you are hereby notified that any disseri1ination, distribution or copying of this . , communication is strictly prohibited. If you have reCeived this communication in ertor, please notity us immediately by telephone and return the original message to US at our Bumsville address via the U.S. Postal SMVice. ~ ~~~1~~, o{\.~}1 ,\::?~.:,:~~~,.'~>-( l $~~~.}~>~'C~\i.".... ,~~'::~~&. >r;.~.~:\~.''' // >'t~1\ry .. ),~~ ~ 0<).~^, ~ :.~~:} ,\ .~>\~:,;, .:,:~\{;~"":~:t ;'i.? .~..>;? ~'}'4 . ~ ~ '~/~\" . ~~~ '~': t :,,,;..;<<~y"~ "':~~v,:;r ~~\. : . , .. . "'. FEB-08-2010(MON) 17:07 W, PAUL OrrEN *, , JULm K. SSYMOYI.t I{t PAULA M. JOSSAltT Eruc T, OJ,SON RJ~HARD 'P. OHLBNBERG MICHABL L LANDIlR, P,A, . BU1mvilkl Qffi.c.~ 108 PWfcsslonal PlIu!I , 1601 Basf HlghWllY 13 Bum.!Vi111:, Minne.ota 55337 T~ephQne(9S1)7~6-3300 rl'c..imUe (952) 736-3400 o Fanntngeon Office , 311 Oak Street ' Fann~tQt\, Mi~eocta 55024 ,Teteph01\e (6'0 463-7151, ' o MinneelPoUs Offlce 1150 Flo~ Exohange BuUdilJll 310 Fourth A'Iet\1Je South MInneapolis, Mil;1t1...tltl! 55415 !el.ephone (em) 379-9#5 tI< ~d Neutral ~nder Rule 114 of the Minnesota ,General. Rules uf P7'a~e Otten & Seymour (FAX)9527363400 P,002lU03 , VIA FACSIMILE February 8.2010 'Ms. Tina: Hansmeier City of Farmington ' Department Qf Econott?lc, Development 430 Third Street' , ' Farmington, MN SS044 , Dear Tina.: " , As a follow up to my letter to you dated February 1; 2010; please understand that there are significant expenses that are necessary to l'ehab~litate the former Seni,or Center for retall oCCll."p8ncy. : , Here is a list of work that we would likely need to undertake to obtain a te~t, . atong with the estimated costs: ',' , . Roof: , , 0, '(Plus possible sheathing or. framing) . Exterior Block . Furnace . lhct,Work . Smoke Detectors . . AJr Conditioning Unit . Electrical '. Insulate'around water meter & pipes . ,Ceiling Tile~' , , . Bathroo~ (to mel't current ADA code) ,-!It Flooring-----' , . 'Sprinkler syste)Jl (reqUired'by,code) . New water line to building from street for sprinkler system . SAC Charges (Met' Council) . Demolish walls & build as 'needed' . Permits & miscellaneous. charges , TOTAL $25,000.00 - $30,000.00 ' '$ 5,000.00 - $10;000.00 $ 5,000.00 $ S,OOO.OO $ 1,000.00 $ '.000.00 $ 25500.00 , $ 500.00 ,$.18,000.00 ,$20,000.00 $30,000.00 ' - $40;000.QO, $12,000.00 S' 5,200.00, $15,000.00 'S 4.800.00 $194,000.00 - $204,000.00 " 1. . . 1 FE8-08-2010(MON) 17:07 Otten 8: Seymour (FAX)9527363400 p, 003/003 OY'~rr'''TE.. N SEYMOUR ,~ .":'~ ,,:\.--;:,7;';', , Feb~at2010 ~age Two .' . . . . . :, . ' . , I;am not able to off~r more than $~O,OOQ.OO unless a sPrinkler syste!ri 'is n~t required. by ,the, City Q.fFanni~01,1. , " Let m~ ~,?w YOU;1' thoughts. very ~ly you~, , .. ' W. Paul Otten, " wPO/mlo t~*;\ '~';~i3:f;:2 t~, . -~,~~,~t~:::. ...- m " ", .;':'<'0~~~~~,~*~:/,;(~;:~,~:,:;:q;;i~?~:\;:'.;~;~.'. .. :.:t' '.' -,.. .. . . :: ::1:.;;1,{,!:;:~:i;!~>~ . '~5;~.< . . -, Tina Hansmeier From: Sent: To: Cc: Subject: Tina Hansmeier Friday, October 01, 2010 9:24 AM Cindy Muller Peter Herlofsky FW: Fax Server: Fax Received - From: '9527363400' To: 'POTS Line1' Attachments: recv0768-001,pdf -m recv0768-00 1. pdf (125 KB) Attached is the fax I received from Otten on September 17th (he sent it on 9/13 but it got lost in our system), which was originally forwarded to you and Peter on September 20th. As you requested, I am forwarding the information again so that you can include it, in this week's "weekly mailing" along with the fax that Mr. Otten sent yesterday. I'm hoping that I can connect with him today to clarify if he'd like to continue working through this or if something changed after I relayed to him the direction provided during Monday's meeting. Regardless if he. remains interested or not, I think it's important to determine just how much of an issue the mold is. We also should determine if we'd like to resolve the issue before putting it on the market or if we should figure out what needs to be done to eradicate the problem and then work that out as part of the sale. Please let me know when you are available to discuss. Thank you, Tina Hansmeier Economic Development Specialist City of Farmington 430 Third Street 651-280-6821 -----Original Message----- From: Rob Boerboom Sent: Monday, September 20,20102:18 PM To: Tina Hansmeier Subject: FW: Fax Server: Fax Received - From: '9527363400' To: 'POTS Line1' From: Rob Boerboom Sent: Friday, September 17, 2010 3:52 PM To: Rob Boerboom Subject: Fax Server: Fax Received - From: '9527363400' To: 'POTS Line!' Attached is your fax document. 1 SEP-17-2010(FRI) 15:42 : W. PAlJL 0rrIlN :II . ?AtJr.A M. JOSSART Elltc'T. OUOllJ MWHAEL L LAN,DER, P.A. \Ae - Bu1'nS'tlitte, Office ' . ~08 ProfCllB!onalPlam ' 1150L Ease HighwaV 13. ~\Imsvill~ MiN\~1;Ii 55337 Telephone (9m '136..3300 , Fwlt4lle (952) 736-3400 , 0 . Fam1lngton Offlce 311 Oak S~er . 'F~D~n, MinnUPtR 55024 Tcl~hcnc (~Sl) 463.11'1 Cl Minneapolis oI/ice 1150 Flour. Bxchangc ~u11dlng 310 Fou:fh AIIeftue Soum MinnI,!Qt;lQ!is, Mil1l1e3<ltil '.5415 . Telephone (tilZ) 379-9445 , ",' Qualified NeutT41 under Rule 114 af the Minnesota. . G~al Rules of Pracrice Otten & Associates. P. A, (FAX)9527363400 P.001/005 Og~~T~~T/E N ~:~~~~~~~~ \~~, ASSO~,IATESll P.A. Fax Tr~$1 Form 'DATE: , Seotember 17. ~OlO , TO: rfua Hatismeier COMPANY: , , City of Farmington .' FAXNUMBER: ' 651-280-6839 . 'NO. OF,PAGES: FROM: " , . 5 (including cover), W. Paul Otten Otieri 8t. Associates RE: If you have. questions or concerns, . please call W. Paul. Otten at (952) 736- 3300. . The information contained in this facsimile message is' confidential and ' intend~ Qnly'for the '!:18e ofth~ individ1:181 or entity named ,above. If the r~ of this mes~age is not the intended redpient"you are ~reby . no1#ied~t 'allY dissemina.tion, distribution or copyfug of this communioation i~ strictly prohibited. If yoU hav:e i:~ceived this , ~oinmunica1ion in error, please notify us immediately by telep~one and , return the original m~ssage to us at 0111" l3umsville address via the US. Postal Service. .. , t ''-:6 ~'$~~;~~- ~f:~~ . ~{1f;' '. " ;,:i~~~,\)~~tW2:~~;~1~~~<:::~~~1~\ ,~~~::~[- ~~~~~:t;'~ .. -. . I r ," :~:;;~r~;k,~~~';.~;~~~~~~' ~\~~(~~~:~. '. ,~~. SEP-17-2010(FRI) 15:42 W. PATJI. OrnN * PAULA M. Joss:AllT ERIC T. oLsoN MICRABL 1. LANoER"P.A. , , BumsvUle OfficI! 108 Prafe.ssianBI ?J9W t601 :EEIlit HI!;h~ 13 B'lII'l1BVllle. MlM.eautls 55337 1el~e\9S~)73~j300 Fl\~lc (95Z) '736-3+00 CI Farmington Office 311 Oak Street ~lngtOn, Minnesota 55024 . Telephone (651) 463: 71S 1 c:J , MtnnsapoUs Office U50 Flour Ilxchl\ng~ Building 310 Fourth Avenue South Minll€spolls, M~m 55415 Telephcne (61.2) 379~9445 (t Qualified Net&tr~ unaeT Rule 114 of the Minnesota General Rule., of Practice Otten & Associates, p, A, (FAX)9527363400 O$'*fP'f/EN ~ L.L~,~ .ASSOCIATES, P.A. P,002/005 .Sept~ber,13~ 2010 ,VIA FACSIMILE Tina Hanst+leier ' City, of Falmmg1on' 430 Third Street, ,~armingron, MN 55024 Dear, Tina: , I am happy to learn that you 8.te back in the office and I look forwa,rd to working with you to resQ.lve the issues surroU;11dingthe sale ofthe'foI.lD;(;tt , , Senior Ce~ter building, , As ~e dis~ll:Ssed ~ere is a very siSniflcant ,moisture issue with the building. It appears,thatthe mold on the carpet, the deterioration oftp.eoutside block 'and the curling of the shingles on the roof are all indicative of a previously ~W:o. mois~ pro~lem, " , , , Attached is a report from Rennie Smith.an environmental' expe~ with.All Phase Companies. With this $108;325:00 estimate pluS haYing to'repl~ a ' . :furn,ace, add a rooftop air conditiOning unit as w~l1 as ad4 a sprinkler system to th~ building inCluding new watet m$ from th~ street,.! tl$k:we ,should eJiscuss a different division of money that go~s toward repairs verses the City of Famiington. . ., On ~ relate,d note. I am still working with the Minnesota Pollution Co:trlrol Agency regarding the classmcf!,:tlon of the Farmington Ground Water Plume as a federal Superfund site, a CERCLIS site and it 'Permanent List of Prlod-ties . site bY',the MPCA:. This classification has'prevenu,d the sale bfmy building'at' 311 Gale Street and likely w4i affeCt future fimincing, .sales and development'in 'adjoining lots doWntown North and Northwest of the Qa;k S~eet doWntown : Qffice building. Are you alsQ the contact person for the City of Fa.im.ingto1,l that de81~ with this type of obstacle tQ 4eyelopment or is there anoth~ contact for' . such environmental concerns? ' " " ci o('M,(:C::"'~1 .:......~). .,~<\.l:" . '~'":'>'."(\'J;f~~;~~"x':::;~">X~~'\~X',~'): '~"J~~\\::J; _~,~:;::?~\,>:..' ~. ,&i~ )"\'\\/'i ;rW' . , :I; ..;\y:::~~~~\ .t;Jf(-:: "'(;?,"'~:{1:B'~)~~~ ,It ,~:I,:\ ':,o.:f.,~~,,~,*i"' ~~~;~::;~~~~~' '~\\ ' ; , "~';~l,:{f(<<~'/l-~~~~;.'>:~~~ ~:~ ~ " "_ 0___ SEP-17-2010(FRI) 15:43 Otten & Associates, p, A. (FAX)9527363400 P,003/005 . . OS!q~fft'To/ E N ~'.. ,.... A,S'SOCIATE'S, P.A.' '. , . . , . ,-I ~cX:;k forward to' ,:\,orki1ig. with YOJ,l on this mOJd ~ssue SO we.' ca,il flnaiii~ i:bis transaction.,. '", .' . Very:tnily'yours, " " '. - . , . ,{i~y,~~):;~:.~t:,~:i:;k{ !"'0~~~(. :;ft;i:X~;$.~t4~~t~<~~ff.:~r';~~' ..:if.;:rn;';;". it!\: ::.).ili~1~;;i~~~.: "\:,,:: . . : SEP-17-2010(FRI) 15:43 Otten & Associates, p, A. (FAX)9527363400 p, 004/005 AllPhase Companies, Incorporated 404~A St Crob( Trail North. Lakeland, MN 55043 Ph # 651-436-2930 Fax # tSSl-436-3918 September I, 2010 Mr, Paul Otten 108 ProfessionalPlaza. Bumsville, Minnesota 55337 Re: Assessment for the pr~(le of mold at 431 3td Street, Farmington. :M:N. Dear Mr. Otten: . AllPhase Companies Inc. assessed the subject site an observed the presence of mold within the building on the subject site. There appeared to be significant mold presence throughout the carpeted area of the subject site. Based on Q\11' observations there could be a number of reasons for the presence of mold 'I1we were a number of building issues that could be contrIbuting to this issue. These include the following: There is evidence of roof deterioration. due to improper venting and potential ice damming along the edge of the roof: Roofissues can allow water inside the building which can cause mold issues, The siding oftha building appears to be a painted clay tile block. The block was grooved and painted. Our experience baa been that this product typically is not utilized as an exterior product, rather that it is coated with a StDtco or iii. brick fascia installed over it. Due to the potential for wate.r migration through the clay tile block we recommend that it be ooated with iii. stucco or a siding product be :installed of the block to reduce the potential fot' water migration through the block which could also add moisture to the inside of the building. Due to the carpet impacted with mold we recommend the removal of all of the carpet from the subject site building. A1.1Phase observed water i:nfiltration through some of the windows, We recommend that the window flashing be evaluated and repaired as needed. Installation of siding would be included in the flashing offh(l windows. SCOPE OF WORK The scope of work we propOile to perl'orm on thi.'l project consists of the following items: Roofine fnstaD~tion Tear off existing shingles and underla-yment, Installation ofvents in soffit area. Jnsta1lation ofice and water shield. tnstallation oftbree tabbed shingles. $1',300.00 Sidlne '"' 4.500 sf lnBtallati.on of siding underlayment Furnish and install Siding. Install tlashing around windows and doors, $67,500.00 Camet Removal Remove on-site CtI1pet - 2,500 sf Carpetreplaoem.ent - 2,500 sf @ $6/sf $5,625,00 15,000.00 Mold Decontamination Installation of critical batrleI'5, HEP A Filter, mold decontamination, application of mold inbibitor Post testing for the presence of mold $4,900,00 $108,325.00 Total of all sections SEP-17-2010(FRI) 15:44 Otten & Associates. p, A, (FAX)9527363400 P.005/005 2 ACCEPTANCE This proposed work scope and associated cost estimate of $108,325.00, Half the payment is due upon acceptance of the job and a. quarter is due at the Qompletion QfhaIfthe project. The remaining balance is duo at the completion of the job unless other atnI3gements are made. Interest of 1.5% will be charged per month on delinquent accoUllt$, Ifpayment is not received when d~ AllPhase inay take any steps necessary to enforce its.rlghts under this agreen1ent. C\IstOtn$' agrees to pay all costs incurred in collection with any delinquent a.ocount, including attorney's fees, whether a lawsuit is COIDn1en.oed or not Your signature on tlrls document acknowledges your acceptance of the proposed work scope and associated costs, Date: Rennie Smith, P,G, AllPhase Companies, me, .Accepted: Date: Major Economic Development Activities March 2011 Prepared By: Tina Hansmeier AK Performance Graphics (308 Elm Street) The owner of AK Performance graphics, Adam Kurth, has been busy renovating the property since he purchased it from the EDA last year, The interior has been completely gutted, and new insulation and sheet rock have been installed throughout the building, A new south entrance door has been installed, All electrical work is complete and exits signs installed. The handrail and wall to the staircase have also been installed, The north and south flat roof areas have been repaired. The bathroom has been re-framed; sheet rocked and is almost completed, A temporary Certificate of Occupancy could be issued within the next three to four weeks, Colleenies Beanies Daycare and Preschool (18500 Pilot Knob Road) Colleen Warner with her husband, Matt, and girls Sophie, Grace, and Lucy celebrated the recent opening of her commercial day care center on Friday,March 18. There are 15 children currently enrolled in the center. The center can accommodate a maximum of 60 children. Staff is looking forward to the playground equipment that will be installed as soon as weather permits, Colleenies Beanies Day Care Ribbon Cutting (adults left to right):Councilmember Jason Bartholomay, Matt Warner, Daycare Teacher, Mrs, Shannon; Cindy Muller, Daycare Teacher, Ms, Sandra; Clyde Rath, Colleen Warner, Daycare Teacher, Mrs, Robin; Daycare Teacher, Ms, Rae; Lee Smick and Mayor Todd Larson, Commercial/Industrial Inquiries Staff received eight (8) commercial specific inquiries during the month of March. Staff also received three requests for financial assistance/grants, Farmington Business Association (FBA) The FBA Is currently organizing the Easter Carnival for April 23 at Meadowview Elementary, The group is also coordinating sponsorship of downtown flower baskets. There membership recently reached 70 members, Farmington Efficiency Inn (20991 Chippendale Avenue) The Economic Development Specialist and Assistant City Planner toured the Farmington Efficiency Inn on Friday, March 18, Staff learned that one of the largest challenges to the new owners of this property was cleaning up and disposing of the accumulation of garbage on site. There are 32 units of which 24 are currently occupied, According to the owners, Sajid Haque and Sravan Bodanapu, there are plans to continue to make improvements to this property. Major Employers Staff is currently in the process of contacting the major Farmington employers to obtain current year employee count information, The table provided below illustrates the information received last year, Employee Farmington Major Employers Count 2010 Farmington Public Schools -ISD#192 800 Federal Aviation Administration (FAA) 650 Dakota Electric Association 208 Marschall Bus Un Inc 215 River Valley Home Care, Inc. 196 Kemps 134 Valmont - Farmington 118 City of Farmington 101 Aerospace Fabrication & Materials 60 Vinge Tile & Stone 21 Pizza Man Construction documents have been submitted by the owner of Pizza Man, Once the Building Permit Application is submitted, it will be considered an official submittal. Realtor Information Day Wednesday, April 6 · 9:00am - Noon · City Hall The purpose of the Realtor Information Day is to help familiarize real estate professionals with the City of Farmington so they can inform their clients about the city that they might move to. Cost: $lS.00jMinnesota CE Credits: 3 and to-date, 29 realtors have registered for this event. The event will provide realtors information about, processes and initiatives underway within the City of Farmington, School District 192, Dakota County Regional Chamber, and Farmington Business Association. Staff is currently working with each of the presenters on their PowerPoint slide information. Rising Stars The Rising Stars business has grown from 6 students to approximately 20 students now enrolled at the new daycare that opened last fall. Vermillion Crossing Senior Ground breaking The CDA has set a date for the groundbreaking of Vermillion River Crossing, the 66 unit senior building they will be constructing, The ground breaking event is scheduled for Wednesday, May 4 starting at 3pm with remarks at 3:30pm, assuming all goes well with the construction bids that are planned for next month,