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Motion by Councilmember Jeffrey, seconded by Councilmember Pearson, that the next Finance Committee includes a case to review the chain of authority, the process of approving expenditures that exceed the approved amount, and how not-to-exceed amounts are communicated with vendors. Motion carried. Voting Yes: Chairperson Strommen, Councilmembers Jeffrey and Pearson. Voting No: None. Absent: Councilmember Elvig. Case #2: Discuss Acquisition of Boike Property City Administrator Norman indicated this is a topic the Finance Committee has discussed many times. The Boike property is a critical piece of property as part of the Northeast River Crossing Corridor. The Committee has reviewed various purchase agreements as well as a joint powers agreement with Anoka County and has discussed how to finance this project. The Committee ran into difficulty the last couple of months with the financing. The Committee most recently looked at a five year bond with a balloon, but the difficulty was that this summer they saw a drop in the amount of building permits. This had serious effects on the budget this year and next year, and they are unable to put this purchase into the budget. Mr. Norman noted that the Committee and Council have expressed a desire to control this corridor. Staff has looked at different methods of financing the acquisition of this property. The City will likely eventually have greater powers if the correction to the port authority legislation passes. Additionally it can be determined if the purchase can be financed through TIF. In addition to this, an unresolved question is what guarantee the City has that this purchase may be eligible in the future for RALF funding once the corridor has been officially mapped. If the parcel is not eligible for RALF funds it will be eligible to be purchased by the Department of Transportation when the project goes forward, but that could be 15 to 20 years from now. Jodi Reuhle, The Tinklenberg Group, reviewed that The Tinklenberg Group was hired to work with another technical firm to look at access improvements and develop conceptual designs. The Council has seen the designs that illustrate this property would be taken in its entirety. It is important to note they started that work in Spring 2005. She met Mr. Boike at the open house where these concepts were rolled out in August 2005. She explained she is stating this to illustrate how patient and cooperative these folks have been. Mr. Boike stated he received a letter dated July 5,2001, which was sent to him along with other folks regarding the affected area that would be under study and moratorium. Mr. Norman and Mayor Gamec signed this letter, so they are familiar with the situation with him that goes back almost five years. He has not been able to do anything significant with this property because of the moratorium. He believes it was year 3 when he called the city planner to discuss if there would be another letter to follow up to this letter telling him if he was free to build or do anything, and he was told no. At that point he assumed his land would be a target. Mr. Boike stated in April 2004, he had several developers come to him wanting to purchase the property. They understood the corridor would go through his land, but to what extent they were not sure. He sold the property in April 2005 but there was a four month due diligence period that ended August 1, 2005, when Jodi put out an announcement that there would be an open house and some viewing of plans as it relates to the upgrades planned. At that point the buyer said this will Finance Committee / September 26, 2006 Page 4 of8