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10/27/1983 - City Council Special 00313 MINUTES OF A SPECIAL MEETING OF THE EAGAN CITY COUNCIL EAGAN, MINNESOTA OCTOBER 27, 1983 A special meeting of the Eagan City Council was held on Thursday, October 27, 1983 at 7:00 p.m. at the Eagan City Hall. Present were Mayor Blomquist and City Councilmembers Smith, Wachter, Egan and Thomas. Also present were City Administrator Hedges and City Attorney Hauge. In addition, Wayne Burgraf and Dan Kaiser of Evensen-Dodge, Inc., Ernie Clark of Miller & Schroeder, Inc., Dick Helde of Faegre & Benson and Dave Kennedy of LeFevere, Lefler, Kennedy, O'Brien and Drawz were present. At 7:00 p.m. Mayor Blomquist convened the hearing and asked City Admini- strator Hedges to review the background of the application for tax increment financing being submitted by the Minnesota Jockey Club, Inc. and in addition, the establishment of a Housing and Redevelopment Authority. He stated the purpose of the meeting was to review the tax increment financing application and to organize a Housing and Redevelopment Authority. RESOLUTION DECLARING NEED FOR HRA The first Resolution submitted to the Council was the Resolution declar- ing that there is a need for an HRA in the City and the establishment thereof. Mr. Hedges explained the purpose of the proposal and the conditions existing to justify the adoption of the Resolution and upon motion by Smith, seconded Thomas, it was resolved that the Resolution as presented, be adopted and approved and ordered signed. All Councilmembers voted in favor. R 83-68 FORMATION AND DESIGNATION OF BRA In order to consider a tax increment financing application, the City must declare and organize a Housing and Redevelopment Authority. The public hear- ing was set on October 6, 1983 and a copy of the Resolution declaring the organization of the HRA was submitted for approval, consisting of Resolution No. 1. Upon motion by Egan, seconded Thomas, it was resolved that Resolution No. 1 organizing the Authority be and it hereby is approved and adopted. All members voted in favor. APPOINTMENT OF COUNCIL AS HRA A Resolution approving appointment of a commissioner to the Housing and Redevelopment Authority for the City of Eagan consisting of the Mayor and four councilmembers was next presented to the Council for approval and adoption. Smith moved, Thomas seconded the motion, all voted in favor, to adopt the Resolution appointing the City Council as the members of the HRA. R 83-69 1 Special Council Minutes October 27, 1983 ADJOURN NT Upon motion duly made by Thomas, seconded Wachter, it was resolved that the special meeting of the City Council be and hereby be adjourned at 7:20 p.m. All voted yea. CONVENING OF EAGAN HRA At 7:20 p.m. Mayor Blomquist announced the convening of the Eagan Housing and Redevelopment Authority. She indicated that the purpose of the meeting was to adopt By-Laws, conduct elections for the HRA and to appoint the Execu- tive Director of the HRA. HRA BY-LAWS The Commissioners reviewed the proposed By-Laws of the Housing and Re- development Authority for the City of Eagan and made certain changes in the draft, including the annual meeting to be held on the first Tuesday of January and regular meetings on Tuesdays, rather than Mondays. Upon motion by Smith, seconded Thomas, it was resolved that the By-Laws of the HRA be and they hereby are approved and adopted as amended and ordered implemented. All voted yes. ELECTION OF HRA OFFICERS 1. Chairman. Smith moved, Wachter seconded the motion to elect Mayor Bea Blomquist as Chairman of the Eagan HRA. All members voted in favor. 2. Vice-Chairman. Egan moved, Blomquist seconded the motion to elect Councilman James Smith as the Vice-Chairman of the HRA. All voted yes. 3. Secretary. Wachter moved, Thomas seconded the motion to elect Councilman Tom Egan as the Secretary of the Eagan HRA. All voted yea. 4. Executive Director. Upon motion by Blomquist, seconded Thomas, it was resolved that City Administrator Tom Hedges be appointed the Executive Director of the Eagan HRA until such time as his successor is duly elected and qualified. All voted in favor. REDEVELOPMENT PLAN AND DEVELOPMENT PROGRAM The proposed draft for the redevelopment plan and development program for the Eagan tax increment project in Redevelopment District No. 1, was submitted to the Council. Smith moved, Wachter seconded the motion to refer the plan to the City Council for hearing on November 15, 1983 at the Eagan City Hall at 7:00 p.m. All voted yea. 2 00315 Special Council Minutes October 27, 1983 ADJOURNMENT Smith moved, Wachter seconded the motion to adjourn the first meeting of the Housing and Redevelopment Authority at 7:35 p.m. All voted in favor. RECONVENING OF THE COUNCIL - HEARING OF THE DEVELOPMENT PLAN Mayor Blomquist reconvened the City Council at 7:35 p.m. and announced the purpose of scheduling a hearing on the Development Program. Egan moved, Wachter seconded the motion to schedule a public hearing on the Redevelopment Plan and Development Program for the Eagan Tax Increment Project of Redevelop- ment District No. 1, for the regular council meeting on November 15, 1983 at the Eagan City Hall at 7:00 p.m. All voted in favor. ADJOURNMENT At 7:40 p.m., upon motion by Smith, seconded Thomas, it was resolved that the special City Council meeting be adjourned. All voted yea. WORKSHOP ON TAX INCREMENT FINANCING Tom Hedges introduced the subject concerning tax increment financing and indicated that a number of consultants regarding the proposed TIF project were present and would explain the proposal and answer any questions of the City Councilmembers or any members of the audience. Councilman Wachter asked what risk the City has in allowing tax increment financing for the proposed race track facility. Dave Kennedy, the special bond counsel for the City indicated that a number of steps will be taken to reduce the risk, but there is no absolute certainty that there is no risk in such a venture. Included will be a development agreement covering the construction and financing of the pro- ject. There will be guarantees on the bonds and other steps of a similar nature will be taken. There were also questions concerning timing of the designation of a class A race facility site. It was noted the Rules Committee of the Minnesota Race Commission is now in the process of completing the drafting of its Rules and will hold a hearing to adopt the rules, with the approval of the rules ex- pected to be completed shortly after the beginning of 1984. A question arose as to whether revenue or G.O. bonds should be used to finance the tax incre- ment financing and it was the opinion of the Finance Committee that has had several meetings, that it would propose general obligation bonds because of lower interest rates and the cost of the reserve that is required for revenue issue. 3 40316 Special Council Minutes October 27, 1983 In addition, the Finance Committee has recommended that a redevelopment district be proposed, rather than economic development district, because the economic development must terminate within about 10 years, and because of the size of the issue with the projected increment, it would not appear to be feasible to finance the project within that period of time. Also, the fiscal disparities tax would necessarily be paid from other commercial and industrial within the City and a subsidy would then be given to the race track facility. Wayne Burgraf of Evensen-Dodge, Inc. reviewed in detail, his letter dated October 26, 1983 to the Council, including a preliminary analysis of the race track project with annual cash flow for redevelpment district. He detailed his letter and the analysis for the Council, including an analysis of annual cash flow for a redevelopment district. In addition, a draft of the Tax Increment Financing Plan Redevelopment District No. 1 prepared by Evensen- Dodge, Inc., was detailed by Mr. Burgraf and it was noted that on November 15, 1983 a hearing will be held on the industrial revenue bonds, on their rede- velopment, on the redevelopment plan approval and the tax increment financing plan appproval. It was noted that the redevelopment district would include only the race track site and also the tax increment financing district will cover the same area. Mr. Clark indicated that the issuance of the TIF bonds should have no effect on the bond rating of the City. ADJOURNMENT Upon motion duly made and seconded, the workshop session adjourned at 9:05 p.m. PHH Cit lerk 4