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HomeMy WebLinkAbout02-25-92 CITY OF LAKEVILLE SPECIAL COUNCIL MEETING • FEBRUARY 25,1992 Mayor Zaun called the meeting to order at 8:15 p.m. following a Council work session. Roll call was taken. Present: Councilmembers Ruhmann, Sindt, Mulvihill, Harvey and Mayor Zaun. Also present: R. Knutson, City Attorney; B. Erickson, City Administrator; M. Sobota, Commutety & Economic Development Director; K. Nelson, City Engineer; C. Friedges, City Clerk. ITEM 3 Mayor Zaun stated this special meeting was called to consider the Redevelopment Contract between the City of Lakeville and Mill Pond Partners (Apothecary Products), which .was tabled at the February 18th Council meeting. A work session was held prior to this evening's meeting to discuss the proposed Contract. Mayor Zaun indicated the Council is united in its position on several items that need to be addressed. City Attorney Roger Knutson relayed to representatives of Mill Pond Partners, on behalf of the City Council, the following proposal relating to the Contract for Private Redevelopment: 1) The Fairfield Business Campus Declaration should be amended so that • there are no special allowances between lot owners.. 2) The City's financial advisors raised concerns regarding the justification of refunding the present value of the interest payment, i.e. Note 2. 3} The proposed completion date of June 1, 1992, does not seem feasible for. the second lift of asphalt and landscaping, and the City is requesting an August 1, 1992 completion date. 4) Considering its current budget, the City is unwilling to pay for title insurance. Typically, the buyer is responsible for this obligation. Mayor Zaun called a recess to allow representatives of Mill Pond Partners to discuss the Council's position. Mayor Zaun reconvened the meeting at 8:35 p.m. Mr. Terry Noble, of Mill Pond Partners, stated his company came this .evening with the assumption that the contract was in final form and was surprised hear the Council's position after the countless hours of negotiations on this document. He further stated that if this was, in fact, the .City's final offer, no further discussion would be necessary. Councilmember Mulvihill reminded Mr. Noble that the City Council had not been involved in negotiations, and the Council first received. the document on the evening of February 20th. t CITY OF LAKEVILLE SPECIAL COUNCIL MEETING FEBRUARY 25, 1992 PAGE 2 Mr. Diessner responded to the Council's proposal as follows: He stated the proposed change in completion dates is a non-issue to his client, as it does not change the substance of the contract. In regard to Note 2, he stated the City issued a Letter of Intent in August of 1991 which stated .the City would issue Note 2. Mr. Knutson read. a paragraph from that Letter of Intent, which stated, "The undersigned hereby acknowledges..subject to the approval of the Lakeville City Council and the execution of the development agreement." Mr. Erickson stated that at na time during the negotiation process did City staff lead Mr. Diessner or .his client to believe that the City Council would approve the redevelopment agreement, including Note 2. Mr. Diessner stated the title insurance issue was addressed in each draft of the agreement. Mr. Erickson explained that the favorable grading contract has enabled the City to accommodate various costs associated with this project. However, the Council felt that title insurance is typically the responsibility of the buyer. In regard to the proposed declaration, Mr. Diessner stated one thing that was critical to Mr. Noble from the onset of this protect was that he would be the anchor tenant in a first-class business park. AS the first person going into the park, Mr. Noble needed the assurance that anyone else who locates. in the park would meet his standards. He felt the City wanted the authority to amend the declaration without his consent, and he was opposed to that. Mr. Erickson explained that the City has an obligation to attract eight and one-half million dollars of additional construction by the year 1998 in order the meet the City's debt service requirement. By requiring potential businesses to read and follow the covenants,. which the Council feels are highly restrictive and unreasonable, the City may not be able to meet that requirement. Councilmember Mulvihill .stated she felt some of Mr. Noble's requirements are totally out of line. She felt that other potential tenants would not look favorably on Mr. Noble having all the rights, while he is not willing to pay any of the fees. Councilmember Harvey indicated he felt Mr. Noble would not have even begun. discussions with the City if he had been faced with these covenants. He stated, "They are so restrictive and so overwhelming that the City of Lakeville will not be able to sell any of the remaining property." It was the consensus of the Council that the Redevelopment Contract, as presented, was not acceptable. .CITY OF LAKEVILLE SPECIAL COUNCIL MEETING FEBRUARY 25, 1992 PAGE 3 ITEM 4 92.54 Motion was made by Mulvihill, seconded by Harvey to approve a resolution awarding the contract for site grading, Fairfield Business Campus, Improvement Project 91-10. Roll call was taken on the motion. Ayes, None. Nays, Zaun, Sindt, Mulvihill, Harvey, Ruhmann. Motion did not carry. 92.55. Motion was made by Sindt, seconded by Ruhmann to receive the feasibility report for Phase I improvements, Fairfield Business Campus, and not authorize the preparation of plans and specifications. Roll call was taken on the .motion. Ayes, Sindt, Mulvihill, Harvey, Ruhmann, Zaun. Mayor Zaun adjourned the meeting at 8:55 p.m. Respectfully submitted, harlene riedges, City Cle D ne Zaun, Mayo