Deephaven City Council

Special Council Meeting

Monday, November 20, 2006

1. CALL MEETING TO ORDER: Mayor Pro Tem Skrede called the meeting to order at 6:30 p.m.

PRESENT: Mayor Pro Tem Paul Skrede, Councilmembers Keith Kask, Kim Crockett and John Wheaton

ABSENT: Mayor Tom Anderson

STAFF: City Administrator Dana Young

2. UNFINISHED BUSINESS

A. Discuss Use of Tax Increment Financing for Chowen’s Corner Project

Kyle Hunt and Derek Eitreim (representing Kyle, Hunt & Partners), Alan Dale (representing Dale Properties), and Gary Tushie (representing Tushie Montgomerie Architects) were present to discuss the possible use of tax increment financing to assist in the acquisition of a neighboring property owned by David Anderson.

Mayor Pro Tem Skrede stated that he had asked that Mr. Anderson be present tonight so that the Council would have the opportunity to decide if both property owners are interested in the proposed use of tax increment financing.

Kyle Hunt stated that there is not currently an agreement with David Anderson to purchase his property at this time but Mr. Anderson appears to be a willing seller at a price that might require TIF assistance from the City.

Councilmember Kask stated that the City needs both parcels as part of the TIF District because one of the parcels is required to have a structure. He stated that he thought it might be beneficial from a planning standpoint to see some improvement on this site because Mr. Anderson’s property does not have the footprint available for adequate access to the property or off-street parking. He stated that he believed it would be in the best interest of the City to see both adjoining properties combined into one parcel. He added that despite these benefits, he would be reluctant to have the City write a substantial check to make the acquisition happen.

Councilmember Wheaton asked David Anderson if he would be willing to move forward conceptually with the idea of negotiating with Kyle Hunt on the sale of his property and participating in a TIF District. David Anderson stated that he would be willing.

Mayor Pro Tem Skrede stated that the City also had checked with the City Attorney on the potential liability of participating in a project where they might be the possibility of finding bad soil. He stated that it was the City Attorney’s opinion that the City would not be held liable to assist with any cleanup efforts due to their participation in this project.

Kyle Hunt stated that he would still like the opportunity to use TIF proceeds for soil remediation if it were needed.

City Attorney Jerry Gilligan stated that the City would have no liability in participating with TIF in the event there was the need for soil remediation.

Gary Tushie stated that they would like to keep soil cleanup as a potentially eligible TIF expense.

Kyle Hunt inquired about the possibility of obtaining municipal water. Mayor Pro Tem Skrede stated that it would be very difficult to obtain water through Minnetonka.

Councilmember Crockett inquired about the costs that would be incurred by the City through establishing a TIF District. Attorney Jerry Gilligan stated that the Developer would pay these costs, who could be reimbursed through TIF proceeds.

B. Authorize Ehlers & Assoc. to conduct Pro Forma on Chowen’s Corner Project

Motion by Councilmember Wheaton to authorize Ehlers & Associates to conduct a pro forma on the Chowen’s Corner Project, subject to receiving a letter from the Developer stating that they would be willing to pay for the cost of the Pro Forma. Seconded by Councilmember Crockett. Motion carried 4-0.

C. Adjournment

Motion to adjourn by Councilmember Kask, seconded by Councilmember Crockett. Motion carried 4-0. The meeting adjourned at 7:05 p.m.

Respectfully submitted,

Dana H. Young, Administrator