HomeMy WebLinkAbout4.A. Authorization of Redevelopment Tax Increment Financing (TIF) Analysis for Canterbury Park Holding Corp. 4. A.
SH'tKOPEE
TO: Economic Development Advisory Committee
FROM: Samantha DiMaggio,Economic Development Coordinator
DATE: 06/17/2014
SUBJECT: Authorization of Redevelopment Tax Increment Financing(TIF)Analysis for Canterbury Park Holding
Corporation
Introduction
Canterbury Park Holding Corporation has asked the City of Shakopee to conduct a Redevelopment Tax Increment
Financing(TIF)Analysis on a portion of their property.
Background
Canterbury Park is currently exploring the possibility of a multi-use development that would include residential,
retail shops,restaurants, and a movie theater. This development would be in addition to the current racing and card
club facility for which Canterbury is well known.
Very early stage planning indicates a possibility of relocating and redeveloping the stables portion of the track,
adjacent to CR 83. In order to facilitate this,public financial assistance may be needed. Canterbury is therefore
exploring the possibility of whether TIF assistance would be possible. Before further discussions may take plan, a
legal and financial analysis of the project will be necessary, as Minnesota law is very specific regarding the criteria
that must be met in order to qualify as a Tax Increment Redevelopment District.
As the TIF analysis would be for the City,the contractor would need to be hired by,and answerable to the City. As
a result, City staff contacted LHB,a full-service architecture,planning and engineering firm based out of
Minneapolis,MN to provide a proposal. LHB has subsequently submitted a proposal for a feasibility study,
including a work plan and cost assessment.
Budget Impact:
This study would be completed for the City of Shakopee's benefit, but Canterbury Park would reimburse the City
for the cost of the study. The proposal is for the work to be done on an hourly basis,with a total cost not to exceed
$24,000,plus expenses. Attached is a copy of the proposed scope of services and description of LHB.
Action Required
If the EDA concurs,it should by motion authorize the appropriate officials to enter into contract with LHB for a
TIF Redevelopment Analysis for Canterbury Park Holding Corporation.
Attachments: LHB Proposal
1MB
PERFORMANCE
EiG s DESIGN.
LHBcorp.com
May 6,2014
Samantha DiMaggio
Economic Development Coordinator
City of Shakopee
129 Holmes Street South,
Shakopee,MN 55379
PROPOSAL FOR INVESTIGATIVE SERVICES
CANTERBURY PARK REDEVELOPMENT TIF ANALYSIS
Dear Samantha,
Thank you for the opportunity to submit a proposal for a Redevelopment TIF analysis at
Canterbury Park in Shakopee, Minnesota. I enjoyed our tour this morning and look forward to
working with your team.
LHB is a full-service architecture, planning and engineering firm with 250 employees in our
Minneapolis and Duluth offices. Our Government studio has extensive experience working with
local governments on their planning, design, architectural and engineering needs. Having been
personally involved as a City Council President, I understand how cities function and the
importance of maintaining the support of the city council and community throughout the
process.
PREVIOUS EXPERIENCE
LHB has significant experience with a variety of inspection and facility assessment projects,
including the analysis of over 100 TIF Districts in the past seven years. Examples include:
• City of Columbia Heights TIF inspection services
• City of St. Paul TIF inspection services
• City of St.Anthony Village,NW Quadrant TIF inspection services
• City of St. Louis Park TIF District inspection services
• City of Mound TIF District"1-2"inspection services
• City of Osseo TIF inspection services
• City of New Richmond,WI TIF inspection services
• Minnesota State Colleges and Universities system facility assessments
• State of Minnesota Facility Assessments
• Property Condition Assessments for the St. Paul Department of Planning and Economic
Development(Franklin/Emerald Neighborhood)
21 West Superior Street,Suite 500 I Duluth,MN 55802 I 218.727.8446
701 Washington Avenue North,Suite 200 I Minneapolis,MN 55401 I 612.338.2029
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Date:May 6,2014
• Condition survey of every property along the I-394 corridor for the Minnesota Department
of Transportation,prior to and during the construction of I-394
• ADA Compliance Assessments for the State of Minnesota (82 buildings in 1992)
TEAM CREDENTIALS
Michael A.Fischer,ALl,LEED AP-Project Principal/TIFAnalyst
Michael has twenty-four years of architectural experience as project principal, project manager,
project designer and project architect on municipal planning, educational, commercial and
governmental projects. He is a Senior Vice President at LHB and currently leads the
Minneapolis office. Michael completed a two-year Bush Fellowship at the Massachusetts Institute
of Technology in 1999, earning Masters Degrees in City Planning and Real Estate Development.
Michael has served on over 35 committees, boards and community task forces, including a term
as a City Council President, Chair of a Metropolitan Planning organization, and most recently,
Chair of the Planning Commission in Edina, Minnesota. He was one of four architects in the
country to receive the National "Young Architects Citation" from the American Institute of
Architects in 1997.
Phil Waugh—Project Manager/TIFAnalyst
Phil is a project manager with 13 years of experience in historic preservation, building
investigations, material research, and construction methods. He previously worked as a historic
preservationist and also served as the preservation specialist at the St. Paul Heritage Preservation
Commission. Currently, Phil sits on the Board of Directors for the Preservation Alliance of
Minnesota. His current responsibilities include project management of historic preservation
projects, performing building condition surveys and analysis, TIF analysis, writing preservation
specifications, historic design reviews, writing Historic Preservation Tax Credit applications,
preservation planning,and grant writing.
Ben Trousdale,AIA—Inspector
Ben is a project architect in LHB's Minneapolis office with 20 years of experience working on a
variety of multi-family housing and commercial projects. He has extensive skills in creating
quality construction documents that convey a building's fundamentals and unique design details.
His responsibilities include project management, code analysis, and overseeing document
production. Ben is a licensed architect in Minnesota and is involved with AIA activities including
Search for Shelter charrettes.
SCOPE OF SERVICES
LHB will provide the following services based upon the terms and conditions described below.
1. Survey the TIF District to determine if it meets applicable coverage test.
A. To meet the coverage test, parcels consisting of 70 percent of the area of the district
must be "occupied" by buildings, streets,utilities,or paved or gravel parking lots.
B. A parcel is not considered "occupied" unless at least 15% of its total area contains
improvements.
2. Conduct a visual review of building(s) interior and exterior:
A. Obtain property owner's consent for inspection.
B. Document property conditions relative to Minnesota Statutes Section 469.174
Subdivision 10.
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Date:May 6,2014
3. Estimate building(s) replacement cost:
A. Replacement cost is the cost of constructing a new structure of the same square
footage and type on the site.
B. A base cost will be calculated by establishing the building class, type and construction
quality.
C. Identify amenities, which increase the value of the building over the standard
construction quality level.
D. Review building permits for each parcel.
E. The base cost and cost of amenities will be totaled to determine the replacement cost
for the property.
4. Evaluate building(s) existing condition:
A. "Structurally substandard shall mean containing defects in structural elements or a
combination of deficiencies in essential utilities and facilities,light and ventilation, fire
protection including adequate egress, layout and condition of interior partitions, or
similar factors, which defects or deficiencies are of sufficient total significance to
justify substantial renovation or clearance."
5. Determine Building(s) Code Deficiencies:
A. Determine technical conditions, which are not in compliance with current building
code applicable to new buildings.
B. Provide opinion of probable cost to correct identified deficiencies.
C. Compare cost of deficiency corrections to replacement value of building.
6. Prepare and deliver report:
A. Prepare a written narrative analysis of the District describing why the property within
the District does or does not meet the criteria as "structurally substandard" as
established in Minnesota Statutes Section 469.174, subdivision 10.
B. Deliver final reports via email PDF.
ASSUMPTIONS
LHB will inspect 22 buildings in a proposed District with two parcels.
The Client will provide the following:
• A scalable parcel map and/or aerial photo of the area to be inspected,including GIS
information with specific parcel date,including parcel area measured in square feet.
• A list of all parcels affected including name of owner,current known business or
resident name and address.
• Available information regarding the condition of the structures,including past
building permit information.
STANDARD OF CARE
LHB shall perform services consistent with the professional skill and care ordinarily provided by
other professionals practicing in the same or similar locality under the same or similar
circumstances.
Any report prepared by LHB represents a professional opinion based upon information available
and arrived at in accordance with generally accepted professional standards. Other than as
contained in the report,LHB makes no express or implied warranty.
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Date:May 6,2014
Short of complete deconstruction to examine every element at every location, no assessment can
reveal all conditions which may exist. Additional testing, assessment, or demolition,may uncover
conditions which would make it necessary to modify LHB's conclusions or recommendations.
Any report prepared for the purpose described in this Agreement is for the exclusive use by
those to whom the report is addressed. LHB will not and cannot be held liable for the
unauthorized reliance upon this report by any third party.
COMPENSATION
We propose to work on an hourly basis with the following key staff:
Project Principal,Michael Fischer(TIF analysis) $231/hour
Project Manager $122/hour
Project Architect/Inspector $112/hour
Project Administrator $77/hour
We will work on an hourly basis not to exceed $24,000 plus reimbursable expenses for a full
report outlining the findings for the proposed TIF District.
Payments are due and payable upon receipt of our invoice. Unpaid balances 60-days after invoice
date shall bear interest at the rate of 8%annually.
Failure to make timely payment to LHB is a material breach of this Agreement and may, at
LHB's sole discretion, result in a suspension or termination of services, and may, at LHB's sole
discretion, result in the termination of the Client's limited license authorization to use LHB's
copyrighted Instruments of Service.
ADDITIONAL SERVICES
If there is a material change in the circumstances or conditions that affect the scope of work,
schedule, allocation of risks or other material terms,LHB shall notify the Client. The Client and
LHB shall promptly and in good faith enter into negotiation to address the changed conditions
including equitable adjustment to compensation. The fees and costs for any additional services
will be based upon LHB's Standard Hourly Rates and Standard Reimbursable Schedule.
SCHEDULE
Our work will require 45-60 days to complete from the time we are authorized to start.
CONSEQUENTIAL DAMAGES
LHB and Client waive consequential damages for claims, disputes or other matters in question
arising out of or relating to this Agreement.
LIMIT OF LIABILITY
To the maximum extent permitted by law, the Client agrees to limit LHB's liability for the
Client's damages to the sum of Ten Thousand Dollars ($10,000) or the amount of fee paid to
LHB, whichever is greater. This limitation shall apply regardless of the cause of action or legal
theory pled or asserted.
USE OF LHB'S DOCUMENTS
The documents prepared by LHB are solely for use with respect to this project. All documents
prepared by LHB pursuant to this Agreement are the instruments of services to the Project and
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Date:May 6,2014
LHB shall retain all common law, statutory and other reserved rights, including copyright. LHB
grants to Client a nonexclusive limited license solely for the purposes of evaluating and executing
the Project. The Client shall not assign, delegate, sublicense, or otherwise transfer any license
granted herein to another party.
To the extent the documents are transferred or are modified, supplemented or otherwise altered
by the Client, subsequent design professional, or any other party, the Client agrees to indemnify,
defend and hold LHB harmless for any claims, demands, damages or causes of action arising out
of such transfer or modification, supplementation or alteration.
OTHER CONDITIONS
The laws of the State of Minnesota shall govern this Agreement.Any provision of this agreement
later held to violate a law or regulation shall be deemed void. All remaining provisions shall
continue in force.
The Client recognizes that materials prepared by others may be subject to copyright protection
and warrants to LHB that any documents provided by the Client do not infringe upon the
copyright held by another.
Unless the parties mutually agree otherwise, the parties shall endeavor to settle disputes by
mediation. A demand for mediation shall be filed, in writing,within a reasonable period of time
after a claim, dispute or other matter in question has arisen.
LHB and the City, acting through the City's legal representative, will, to the fullest reasonable
extent, cooperate and coordinate efforts in preparing necessary responses to any third party
challenges to the inspections. The City agrees to pay LHB its regular hourly rates for time spent
as a result of a third party legal challenge
If the terms and conditions of this Agreement are acceptable, please sign and return a copy to
LHB.
CLIENT NAME LHB, INC.
By: By,: __IikrWC224, '
(Signature) (Signature)
Its: Its: Senior Vice President
(Title) (Title)
Name: Name: Michael A. Fischer,AIA
(Printed Name) (Printed Name)
C:\Users\ma&sch\Documents\LHB\TIF\TIF Agreements\Canterbury Park TIF District 5-6-14.docx