HomeMy WebLinkAboutWork Session #1 Alternative Development Scenarios O � Pitlp
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4646 Dakota Street SE
'�'�vrv�soK� Prior Lake, MN 55372
CITY COUNCIL WORKSHOP REPORT
MEETING DATE: JUNE 24, 2013
PREPARED BY: FRANK BOYLES, CITY MANAGER
JANE KANSIER, ASSISTANT CITY MANAGER
PRESENTED BY: FRANK BOYLES
AGENDA ITEM: CONSIDER ALTERNATIVE DEVELOPMENT OPTIONS FOR PROPERTY
LOCATED AT CR 21/WEST AVENUE
DISCUSSION: Introduction
The purpose of this agenda item is to consider a number of potential development
options for the 5 acre parcel located south of County Road 21 and east of West
Avenue.
This property is currently undeveloped, but there is a stormwater pond, County road,
a sidewalk and a light pole located on the property without easements. Over the
past several years, the City has been working with the property owners to address
these issues and to obtain the necessary easements, without success.
Historv
As noted above, the property is undeveloped but there is a long history on this site.
Following is a timeline of some of the events:
1980's County acquired storm sewer and right-of-way easements on this
property for the CR 21 construction. The easements were never
recorded.
12/1997 The City sent an easement document to the Rhoads, the property
owners of record at that time, for a stormwater pond to be
constructed as art of the West Avenue reconstruction ro'ect.
6/1998 The Rhoads signed the easement and returned the document to
the Cit .
6/1998 The City sent the easement document to the Scott County
Recorder's office for recording; the document was somehow lost
at the Count and never recorded.
6/2/1998 The City opened bids for Project #98-14 (West Avenue
reconstruction
8/19/1998 Stormwater ond was raded
Fall, 1998 Pro�ect com leted
9/20/1999 The City realized the easement had not been recorded and
attem ted to re-secure easement from the Rhoads'.
12/16/1999 The City received a reply from Renee Rhoads stating the
ro ert had been sold to Staber.
1999 City sent a letter to Staber requesting easement; no response in
file and easement never si ned.
10/2001 The City received an application for a preliminary plat and a
preliminary PUD for the development of 32 townhouse units on
this ro ert .
3/18/2002 A lication was withdrawn before Cit Council action.
8/18/2003 City Council approved Resolution #03-141 amending the
Comprehensive Land Use Plan to designate this property C-TC
Town Center . This is the current desi nation.
4/5/2004 The City Council approved Ordinance #04-16 rezoning this
property to C-3 (Specialty Business). This is the current Zoning
desi nation.
12/18/2008 City Council heard a presentation on a concept plan for a 57-unit
senior housing building on 3 lots within this site. No additional
a lications were filed.
5/19/2010 Property owners cut down trees and begin grading site without a
ermit. Ci issued "Sto Work" order.
9/22/2010 City sends a letter to the property owner outlining several issues
and re uestin a meetin to discuss these issues.
10/12/2010 Scott County sends a letter to the property owner stating its
position on access to the property from CR 21. The County
states access to this property will be from Duluth Avenue and
from West Avenue; no access will be ermitted from CR 21.
2010-2013 Multiple contacts with property owners and property owners'
attorneys on this site. The City sent several easement
documents to the owners for review, although none have met
their approval. Sand Company offers owners $500,000 to
purchase three parcels. Offer rejected on the basis that owners
wish to dis ose of entire iece.
Current Circumstances
On June 13, 2013, the City received a letter from the property owners' attorney
demanding payment for the pond or removal within thirty days. City and Scott
County representatives met on June 14, 2013, to discuss potential options for this
site. County attorney corresponds with owners attorney requesting a sixty day
extension in order to determine if another plausible option can be pursued.
The following are the options identified by the staff:
Option #1: City and County pay appraised value for land used for ponding,
sidewalk, light, right-of-way and access restriction. City pays $110,000 and County
a s $110,000.
PROS CONS
• The matter is disposed of in the • CR 21 access restriction not
short run addressed
• Stormwater ponding for any future • Parcel likely to remain
development on the site will be the undeveloped
sole responsibility of the developer . Potentially higher court financial
decision on award for damages
• Actual cost of this option least
predictable because of access
restrictions
Option #2: City purchases total parcel and Scott CDA develops 54-unit senior
housing building. City pays appraised value of $1,050,000 for five acres. Three
acres needed by CDA are leased from City for $1.00. CDA builds, subsidizes and
operates senior housing on three parcels and double or quad units on fourth parcel
with fifth parcel used for access and ponding.
Page 2
PROS CONS
Property developed • City finances costs for parcel and
• 54 additional units of senior is paid back appraised land value
housing and Quad/Double in 30 years when bonds are
• Access restriction addressed released. Fifth parcel purchased
• Land purchase is a long-term jointly by city and county
investment for city � CDA pays PILOT payment in lieu
of ro e taxes
Option #3: County and/or City purchases five acres using County bridge and road
funds. In one year, Sand Company purchases three parcels and constructs 54 units
of tax credit workforce housing. CDA purchases Lot 2 for 6-8 units of multi-family
CDA rental housing. Lot 1 purchased jointly by City and County for drainage and
access ur oses.
PROS CONS
• Property developed with 54 units of • Senior or luxury multifamily project
workforce housing added forgone.
• City/County paid back for'/2 of • City, County and CDA have not yet
investment in 12 months determined the cost share for the
• County shares cost of one parcel remaining two parcels.
• Workforce housing subject to
property taxes
• Back up plan is CDA would
purchase Lots 3, 4 and 5 for CDA
multi-family housing should Sand
Company's tax credit application
not be funded by the MHFA.
• Access restriction addressed
Option #4: Remove the existing public infrastructure from the property. This
requires filling in the pond and removing the sidewalk and light pole. Estimated short
term cost of this action is $50,000.
PROS CONS
• Least costly alternative now • Lot remains undeveloped
• Stormwater ponding for any future • Untreated storm water flowing into
development on the site will be the County system and to Prior Lake
sole responsibility of the developer . In the short-term, the City may
need to pay to provide ponding at
another site to comply with City
and Watershed requirements
• Does not secure necessary right-
of-way for future CR 21 expansion
• There will be trail and sidewalk
closures due to missing sections
• Access restriction not addressed
• Ma not avoid court action
Conclusion
Staff is seeking Council direction. Of the options identified above, staff believes that
3 is the most appropriate.lt provides housing for an important segment of our
workforce. It assures the entire parcel is developed, access restrictions addressed
and ownership matters are permanently concluded. It shares the responsibility to all
three public entities. It has a backup plan. It provides for ongoing property tax to
Page 3
support all entities. With two experienced entities like Sand Company or the CDA
managing the property we are confident of ongoing maintenance of the property.
Page 4
HUEMOELLER & GONTAREK PLC
ATTORNEYS AT LAW
16670 FRANKLIN TRAIL
P.O. BOX 67
PRIOR LAKE, MINNESOTA 55372
(952)447-2131
Fax: (952) 447-5628
E-mail: HBG e ,priorlakelaw.com
ALLISON J. GONTAREK
BRYCE D. HUEMOELLER
THERESA A.PETERSON
June 13, 2013
Mr. Frank Boyles By Facsimile (952-447-4245) and U.S. Mail
City Manager
City of Prior Lake
4646 Dakota Street
Prior Lake MN 55372
Re: Gary Staber/LeArnold and Judy Klingberg property
Dear Mr. Boyles:
My clients, Mr. Staber and Mr. and Mrs. Klingberg, have authorized me to contact
you regarding the status of the holding ponds that were built on their property without
their consent. As you know, we have been in extensive negotiations to try and resolve
both the ponding issue and the right of way takings on this property, that abuts
185�`/CSAH 21 and thought we may have had a tentative resolution over six months ago.
Nothing has happened, something that appears to have been the standard for these
negotiations between my clients and the City over the past 5 years.
Mr. Staber and Mr. and Mrs. Klingberg are beyond frustrated and estimate that
they have had to pay over $150,000.00 in property taxes that would not have been
necessary had they had been able to sell their property. While certainly the market and
economy played a large part, my clients feel that the City did little to cooperate with
potential buyers.
In order to reach some conclusion, even in a partial manner, Mr. Staber and the
Klingbergs are hereby demanding that they be compensated for the installation of the
holding pond AND be guaranteed a right in/right out to Duluth Avenue from the
property, with direct access from Duluth to 185 within 30 days of the date of this
Mr. Frank Boyles
City Manager
City of Prior Lake
June 13, 2013
Page Two
letter. Any agreement will not affect any other access rights that are available to the
other lots held by Mr. Staber or the Klingbergs. If the City is unwilling to meet this
demand, then the holding pond must be removed within that 30 day period and the land
restored. As you know, the City had no legal right to create that holding pond area and it
constitutes a trespass onto private property, as does the sidewalks and light post on the
Klingbergs on the eastern edge.
Please advise no later than June 20, 2013 as to the City's intent. Thank you for
your assistance in this matter.
�er� truly ours, �,
� �,�, � �
.� �
Allison J. Gontarek
Cc: clients
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