Committee Minutes

2002 STOREFRONT REHAB PROGRAM
Tuesday, July 9, 2002 - 4:30 p.m._________

Members present: Glassheim, chair; Gershman, Hamerlik.
Staff present: Terry Hanson, Curt Siewert, Keith Johnson, Peggy Kurtz.

Terry Hanson reported that the previous funding for the Griffiths Building in downtown which had been turned down by the city council and as a result it freed up approx. $73,000 for storefront rehab that the city council allocated to that program, that boundaries set to include Gateway Drive from the Red River to 42nd Street, and to include North and South Washington Street from Gateway Drive to 17th Avenue South. He stated they advertised for applications with deadline of May 31, they received a total of 12 applications (several aps. combined with a total of 9); staff ranked the applications and the application from SF Plaza 97, LLC (Grand Cities Mall) is not within the area and is a non-eligible application; the other applications include Application 8 which is from MX Properties, LLC, an apartment complex, and that applications have never been used for rental rehab projects though not specifically excluded and the owners would argue that rental property is a business, that would be a decision for this committee to determine whether want to consider those or not and staff's recommendation that we do not consider them and that for the year 2003 they will bring to city council in their CDBG funding a rental rehab program for which these applicants could apply.

Mr. Hanson stated today the committee is to review the applications and to rank those, to bring those to the committee of the whole on July 22 and to city council on August 5.

Mr. Hamerlik asked if applicants had been requested or had opportunity to make a presentation; Mr. Hanson reported all aps. had been notified that today committee would review applications. The committee reviewed the letter that was sent to the applicants. Mr. Gershman noted there were three properties that have marked on the application that their taxes and special assessments were not paid, and that should automatically eliminate their applications; that if the taxes not paid they shouldn't be eligible for a grant (Aps. #3, 4 and #7), applicant should have been denied because the taxes weren't paid, and will not support any property that has not paid their taxes. Staff reported question asked for same reason the committee is discussing, to determine whether they are eligible or make a requirement of receiving the grant to have your taxes paid. Mr. Gershman stated that if taxes not paid, shouldn't benefit from programs that are generated by taxes. Mr. Hanson stated they would review that to make sure taxes haven't been paid (are delinquent). Chairman Glassheim noted that if taxes not paid, should be included in the application form. The committee noted that the letter was clear and if have application for a grant should appear at meeting.

The committee asked to hear presentations by applicants who are present.

Applicant #5 - Mexican Village $3,863
Angie Heit and Mickey Johnson, 1218 South Washington Street, reported they purchased business last October and in need of some repairs, want to buy cabinet sign from Indigo Signs (was used on different project - new- 3'x18' and include redoing neon lights, want to put window between the front of the building (lobby area) and replace two front doors, replace tile, planters, replace clay tiles on the roof of the entryway .

Application #6 - State Farm Insurance $1,100
Kevin Kouba, 724 N. Washington Street, stated he recently moved to Grand Forks from Bismarck and going to be the new State Farm Insurance agent in the existing office, he purchased the building from the agent on May 31 and began major renovation of the interior building and also
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going to be doing some work on the exterior - small project, clean up sign poles, put new sign (lighted 4x8.5' sign and installation of sign approx. $1,000-1,200) and put up a flag pole.

Applicant #9 - SF Plaza 97, LLC (Grand Cities Mall) - $30,000
Larry Stammes, 1720 South Washington Street, requested if they could be included in the rehab program area, that one of the eyesores on S. Washington is the former Sears Building and have some major renovation plans for that property, they didn't get the application in on time either because they didn't officially own the building until June 1.

Mr. Hamerlik stated he couldn't support this application at this time, but would be supportive if we opened it up again, not against the project but against making any award at this time without having other businesses having same opportunity. Mr. Stammes stated they need to move forward at this point and if you extend this program and they come back and say they spent $xxx on the outside - It was noted they can't use HUD money for project that is already in progress. Mr. Stammes stated they intend to have tenants in there prior to the holiday season, and expect to make the area along 17th Avenue (old warehouse) retail space as well and want to dress up the entire outside of the mall; and asked if there was possibility for council to extend the program or if there are any monies available at this time - Chairman Glassheim stated they have applications for the money that is available, however, there are applications that are not eligible or not highly ranked and may be some funds available, and would take council time to extend the program and vote couldn't be until August 5 and 15 to 30 days to advertise it for other people to compete. Mr. Stammes stated that the facade would be the last thing they will be doing, which probably wouldn't be until October and won't be doing all of it at once - only part that would be done is the main part of the Sears Building, automotive is one of the biggest challenges financially as will not be leasing that out as automotive space again.

Mr. Hanson stated the next cycle with funds to be available would be January 1, 2003 but believes they will have additional program income from this year's proceeds and have second funding cycle - he also noted for every business that goes in there, every actual storefront they create is a separate storefront and could apply for one application for each of those. Mr. Stammes stated there might be 9 to 12 individual storefronts. Mr. Hanson noted that their original recommenda-tion was to go to 24th Avenue but reduced back to 17th. Gershman stated the reason it was pulled back from 24th was that it was going to be so big and wouldn't have any impact.

Application #1 - Auto World $10,000
Application #2 - A & W; Long John Silvers $20,000
Brad Huebner reported he had application for Auto World for additional signage there, and putting a community service board - temperature and time.
Mr. Huebner stated he is working with A & W and Long John Silvers bring them to town and negotiating with them and know by the end of this month whether that will happen, proposing on that on the corner of University and North Washington - rehab of what is there (sign is new) and rehab of existing building by extending it. The committee stated that the purpose of these grants is to help renovate and improve and make newer and because that is a problem that it's a new sign and adding to that sign doesn't meet definition.

Curt Siewert stated that he asked Mr. Huebner to submit application on the restaurant; Mr. Huebner stated he would know by the end of July and would like extension to the end of this month, that he is working diligently to get this project underway and back in town - that he is working with development of the property - two stores (separate crews and registers). Mr. Hanson
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stated if two different establishments, talking about two storefronts (combined application).

Keith Lund reviewed the staff's recommendations ranked in merits of the applications and with respect to comments re. property taxes not weighed.

Mr. Gershman stated if applicants not being considered for allocation, there would be $47,603 that was requested that could not take into a second round, and could accommodate and go out to 24th, but need clarification about the taxes. There was discussion re. applications and funding of applications.

It was moved by Gershman that we approve Application #5, Mexican Village, for $3,863.00 and Application #6, State Farm Insurance, $1,100.00 and Application #2, A & W, Long John Silvers Rehabilitation contingent upon execution of the purchase of the building by September 1, and to deny the other applications.

It was also noted by committee that unless the application is completed, property (including sketches and architectural drawings, drawn to scale, showing improvements as they will appear upon completion, including signs, that staff should not even have them come forward when not completed properly - get in trouble when deviate from what should be doing. It should also noted they will not be eligible if taxes are not up to date.

Council Member Hamerlik seconded the motion.

Mr. Hanson checked the taxes on the applicants in question and reported that Applicants #3, 4 and 7 had not paid their taxes. He also noted that the taxes on Application #2 the taxes are not paid by current owner - Gershman stated he would amend his motion that contingent upon the taxes being paid upon transfer of the property. All the other properties are paid.

The committee stated that when MX Properties, LLC (apartments) is notified, that they be told of the new program that is coming in that they would qualify for.

Upon call for the question, the motion carried.

Hamerlik moved that we ask staff to prepare for committee of the whole an expanded area for round 2 on Washington Street up to 24th Avenue South and to the street running north of Valley Ho Trailer Court. Gershman seconded the motion.

Mr. Hanson stated the storefront program started in 1986 downtown and took a few years for it to catch on, was disappointed that they got one application from Gateway Drive and Gateway Drive Assn. is aware of this program, that this is the initial step of a long term program in these areas and in the future allocate more funds to this program and encourage businesses to fix up these areas.
In answer to Mr. Stammes' questions, it was noted that interior storefronts would qualify, and payment of the grant would be reimbursement on proof of payment. It was also noted that the existing boundaries are still eligible for second round, can resubmit applications - only extending the boundaries and taking re-aps, if paid taxes could resubmit their application.

Upon call for the question, the motion carried.

Meeting was adjourned. Alice Fontaine, City Clerk