Consider Funding Options for Clean Up Project for River Walk Village; Case of Village Bank  (Previously Item 7.04)

• Adopt Resolution #19-101 Authorizing Application for Metropolitan Council Tax Base Revitalization Account Grant
• Adopt Resolution #19-102 Authorizing Application and Local Match for Minnesota Department of Employment and Economic Development (DEED) Grant

The purpose of this case is to consider authorization to apply for two cleanup grants related to River Walk Village. This is not final approval of the grant nor final obligation of financial commitment under the grant. This is not the traditional planning and zoning approval step for development projects, which would occur at a later date.

The City Council was introduced to this overall project in March 2019 in terms of subdivision design. It was noted at that time that a significant cleanup project would be required, but did not discuss in detail. An unapproved landfill operated on this site many decades ago. The end result is an area approximately one acre is size and approximately 14 feet deep in areas comprising of construction waste. It should be noted that the landfill was not created by the current owner. The current owner is Village Bank, who acquired the parcel through foreclosure.

Based on numerous soil explorations by the current owner or development prospects, no hazardous materials have been found. It is essentially construction materials such as concrete, asphalt, wood, and roofing materials. Staff has had numerous discussions with regulatory agencies over the past three years, and it is accepted that all materials must be removed and brought to an approved landfill. There appears to be no scenario where improvements can be made to the property on top of the debris field, and the debris field cannot be moved within the site.

The current development proposal is for 14 small lot, detached-single family homes (villas). Details on the land use review component are not included in this case, as that discussion will occur at a later date. Tonight's discussion focuses on authorization to apply for grant funds to assist with the clean up that also includes a requirement for a local match. It is noted that regardless of the ultimate land use, this cleanup project must occur.

Notification is not required for this stage. Notifications of this projects were sent via Standard US Mail to Property Owners within 700 feet of the property of the Planning Commission Sketch Plan Review back in March, as reflected by Anoka County Property Records. Notifications were not sent for this current case and are not required.

Staff would like to discuss two related funding options to fund a majority of the cleanup costs (88%). With the two programs combined, the City would need to provide a local match of 13%. Total cleanup costs are estimated at approximately $800,000 (planning level estimates only). Under this scenario, the City's local contribution would be approximately $96,000. Staff would recommend that the City request these funds from the Anoka County Housing and Redevelopment Authority (ACHRA).

The primary benefits are the removal of construction waste that was not properly disposed of in an approved construction debris landfill, converting the site to a developable parcel. This must occur in any development scenario. The costs of cleanup far exceed what a typical development pro-forma would be able to sustain.

Secondary benefits include, but are not limited to increasing tax base and providing a wider range of housing options in the community. Due to the impacts of the property, very little taxes are generated on this parcel. Additionally, after continued design review with the neighborhood over the past several years, Staff feels that the current development proposal is generally compatible with the surrounding neighborhood, with continued adjustments to be discussed at a later date.

Under the proposed cost share proposal,

• 75%/$600,000 = Contamination Cleanup Grant (DEED).
• 13%/$104,000 = Tax Base Revitalization Account (Metropolitan Council)
• 12%/$96,000 = City of Ramsey (ACHRA Account)

Based on discussion. Staff recommends that the construction debris be removed from the site in any scenario. Furthermore, Staff believes that the current cost share proposal is reasonable, and the most feasible option on the table. That being said, the City is not obligated to support the Applications nor provide a local match. Without assistance, it is unlikely the project will move forward, and most development projects proposed will have little success moving forward.

Motion to adopt Resolutions #19-101 and #19-102 approving grant applications and local match authorization related to River Walk Village.