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DEFINING REDEVELOPMENT AREA FOR CDBG FUNDS <br /> By: Sean Sullivan, Economic Development / TIF Specialist <br /> <br />CASE # <br /> <br />Background: <br /> <br />Staff has identified 'four parcels of land for redevelopment and utilization of $220,000 in <br />CDBG monies. The properties include Debee, KIH Erecting, Chies and Morrell. The <br />Chies and Morrell properties are adjacent to the St Paul Terminal (formerly known as <br />Danny's Tranny) site and the Debee and KIH properties are just south of AEC EnergY <br />Park and north of the recently acquired Alloy Recovery site. At this point no site has <br />been given a higher priority over another for redevelopment. Negotiations with Chies <br />and Debee have been difficult and the lack of an immediate "end-user" has not expedited <br />the negotiation process. The grant monies must be spent by June 30, 2003. Staff feels <br />that it would be prudent to prioritize the site acquisition and proceed. <br /> <br />Staff was directed to obtain possible site improvement costs associated with the Chies <br />and Morrell properties. The Chies property cleanup of debris, trucks and equipment is <br />estimated to be $50,000. The Morrell property demolition is estimated to cost $20,000. <br />It should be noted that Tom Sauter currently leases the building on a month to month <br />basis, at a rate of $3000 per month. This lease could be continued until the demolition' <br />occurs and could help subsidize a portion of the redevelopment costs. The length of the <br />lease is not defined being that it is a month to month lease but we will assume that the <br />lease will be in effect for 6 of the eligible 12 months~ The Chies and Morrell properties <br />are located within the boundaries of a TIF District and could be added back and partially <br />subsidized with tax increment for previously budgeted expenses. The added expenditures <br />to the district would not create a cash flow problem for TIF District-No. 2 <br /> <br />Site improvement costs appear to minimal in regards tO the KIH and Debee properties <br />because no buildings will need to be demolished and all of the eqUipment currently on the <br />properties seems to be in working order. The KIH and Debee properties are not located <br />within a TIF district and do not have the additional funding sources available for <br />redevelopment. Estimated costs associated with each of these properties are attached <br /> <br />Recommendation: <br /> <br />Based on discussion <br /> <br />EDA Action: <br /> <br />Based on discussion. <br /> <br />Reviewed by: <br />City Administrator <br /> <br />EDA: 12/09/02 <br /> <br /> <br />