Update on Potential Tungsten Redevelopment Area Project

Purpose: 
At the September 12, 2019 EDA meeting, the EDA authorized staff to begin work on the Interim Phase 2 component of the potential redevelopment project.  Items identified in this phase included:

1. Documenting interest in landowners and business that are looking to sell.
2. Potentially acquiring parcels from willing sellers.
3. When possible, entering building and conducting an inspection and documenting the conditions with LHB , or other TIF professional present.

Background:
More work, including ROW acquisition necessary for the Hwy 10 improvements has identified parcels the have the potential for full acquisition and demolition of substandard structures. There is a possibility that some, or all of these properties might end up being partial acquisitions.  Some of these structures are in the the Tungsten redevelopment area and are shown on the attached TIF Feasibility Analysis map.  The time frame for acquisition of parcels that are needed for ROW will likely occur in the next several months with demolition commencing shortly after based on discussions with Anoka County.  

Based on the timing of potential acquisition and demolition of some of the structures in the Feasibility Analysis Area, inspection need to be conducted as soon as possible. The purpose of these inspections is to obtain Findings on the condition of the buildings to determine if they could qualify as substandard buildings per the TIF Redevelopment Statutes.  Staff already has previously received authorization to commence these inspections in 2019 but staff has included a specific proposal to get the work completed by LHB and to show the proposed costs totaling $9,800.  There is a cost savings in doing multiple inspections ($2,450 for 4, $4,400 for 1).  If it is determined that a building is substandard the costs for acquisition and demolition become qualified for reimbursement for a future potential redevelopment TIF District.  Statute allows for the district to be created up to 3 years after the findings have been made. The attached memo from Ehler's outlines the process and qualifications in greater detail. 

The City of Ramsey will likely be required to make an estimated $4M financial contribution to the Ramsey Gateway Project. $2M from the MSA fund and $2M from the PIR fund has already been budgeted. Obtaining ownership of parcels in the potential TIF District could be an efficient use of the City contribution and potential redevelopment efforts. Staff is asking the EDA to consider making a recommendation to the City Council to allocate funds for the purpose of acquisition and demolition if they are available and eligible contribution / TIF expenses. The recommendation would be conceptual in nature and not have a specific dollar amount.

 

Notification is not required.

The Ramsey Gateway Project is now fully funded and negotiations for property acquisitions for the project are now beginning. Anoka County is the lead agency that is responsible for putting offers together for parcels that may be impacted, closing the transactions and ultimately processing relocation benefits as required by law.  It is possible that the City of Ramsey might end up with the ownership of some of the land parcels acquired as part of the Ramsey Gateway Project by allocating the required city contribution to land acquisition.  This ultimately will be decided by the City Council, Anoka County and other agencies involved in the project.  

Staff is looking for authorization to enter into a contract with LHB to conduct inspections and develop "findings" that will allow the city to maximize its ability to recover costs, or to provide incentives if a redevelopment TIF District is created in the future.

Alternatives:
1) Authorize Staff to execute contract with LHB to obtain letters of findings for potential TIF District (as presented)
2) Something else.

and;

1) Recommend to City Council that the City of Ramsey consider concept of using available, required contribution funds for the Ramsey Gateway Project on land acquisition / demolition expenses 
2) Something Else

The expense for inspections has been previously approved by the EDA.  The funding source would be the EDA Professional Services line item 9230.6315. A project code is being set up for the costs incurred for a future potential Tungsten TIF Redevelopment District. 

The funding source for potential acquisition costs and demolition would be from MSA or PIR funds.

Staff recommends that the City enter into a contract with LHB to conduct inspections of buildings that have the potential to be acquired as part of the Ramsey Gateway Project. 

Staff also recommends the the EDA recommend to City Council that the City of Ramsey consider concept of using available, required contribution funds for the Ramsey Gateway Project on land acquisition / demolition expenses. 

Motion to direct Staff to enter into contract with LHB to conduct inspection services and obtain letters of findings.

and;

Motion to recommend to City Council that the City of Ramsey consider concept of using available, required contribution funds for the Ramsey Gateway Project on land acquisition / demolition expenses.