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HRA 05/11/1989 - 6396HOUSING AND REDEVELOPMENT AUTHORITY MEETING THURSDAY, MAY 11, 1989 7:00 P.M. r 10 •,11 - -+ li CITY OF FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY APRIL 13, 1989 CALL TO ORDER: Vice - Chairperson Schnabel called the April 13, 1989, meeting of the Housing and Redevelopment Authority to order at 7:10 p.m. ROLL CALL: Members Present: Virginia Schnabel, John Meyer, Walter Rasmussen Members Absent: Larry Commers, Duane Prairie Others Present: Jock Robertson, Executive Director of HRA Bill Burns, City Manager Barbara Dacy, Planning Coordinator Julie Burt, Assistant Finance Director David Newman, Attorney Frank Kitterman Roland Stinski Cheryl Stinski Pat Fischer Pat McCullough, Health Planning & Management Resources (HPMR) Joe Commers, The Commers Company APPROVAL OF MARCH 9. 1989, HOUSING & REDEVELOPMENT AUTHORITY MINUTES: MOTION by Mr. Rasmussen, seconded by Mr. Meyer, to approve the March 9, 1989, Housing & Redevelopment Authority minutes as written. UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. 1. CONSIDERATION OF AGREEMENT FOR CITY USE OF FRIDLEY PLAZA RAMP Mr. Robertson referred to the letter from Mr. Newman dated March 22, 1989, which requests the formalization of the understanding that the City has the right to use the parking facility. That is the purpose of the draft agreement. The second paragraph of the proposed agreement addresses the issue of maintenance. They have discussed the fact that the HRA probably will maintain the structure so they have included the provision. This would mean primarily that the HRA would pay for a snowblower sk HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 13, 1989 — PAGE 2 in winter and certain shrubs that will require maintenance around the edge. Mr. Rasmussen stated maintenance is another issue and he wanted to have this item deleted. The projection of expenses is unknown at this time. Mr. Newman agreed, but stated someone must maintain the ramp. If, in fact, the HRA is going to assume responsibility, this provision should occur in this agreement. The paragraph can be struck if the HRA is not inclined to do so. Ms. Schnabel asked if it is possible to break out the maintenance into a separate paragraph and spell it out more specifically. Has the HRA agreed to perform all maintenance, i.e., if there is a structural defect, changing light bulbs, vandalism, etc.? It would be good to have this spelled out more clearly on what maintenance items the HRA would have responsibility. Mr. Newman stated his intent is that the HRA would cover all those items. This is to get it on the table for discussion. If the HRA wished to do less than that, he needed to know just what the HRA was going to cover. Mr. Rasmussen indicated that the user is the City. Mr. Robertson stated that, in addition to the City's office employees, the ramp is for the public. The Fridley Plaza Office will use it also and the Fridley Plaza Clinic to some extent. Mr. Meyer suggested getting together with the main users and arriving at some formula for maintenance. Maintenance involves more than a snowblower. The snow sometimes needs to be hauled away, the approach road needs to be plowed, the ramp needs to be hosed down in the spring and fall to clean, drains need to be checked, etc. All these things should go on for ramp maintenance. It could amount to thousands of dollars per year. Someone had to plow the original lot before. Negotiate with them for service. The ramp was built for the good of others, and they should see if the others could chip in. Mr. Newman recommended deleting paragraph 2, having staff submit estimates on the cost of maintaining the ramp and having it on a discussion item the next time the City Council and HRA meet. Mr. Meyer asked, if no maintenance agreement is forthcoming, could the issue be resolved before the agreement at hand is signed. Mr. Newman indicated the two bodies need to meet together. HOUSING i REDEVELOPMENT AUTHORITY MEETING, APRIL 131 1989 - PAGE 3 Mr. Meyer recommended getting together with the Plaza Office staff, the City Council, etc. and see what could be done. Mr. Newman felt that would be difficult. Under the office building lease, the HRA is required to provide parking. Neither the clinic nor the office building has responsibility for maintenance. This becomes a question between the City and the HRA. This is an issue that needs to be resolved, and he did not feel this would be resolved at the staff level. Mr. Rasmussen requested Mr. Newman present to the City that they provide maintenance. Mr. Newman stated the City must deed the lot over to the HRA, and the City requested a document in writing which provides that the City can use the ramp. Secondly, they need to indicate to the City Council that it is the HRA's feeling that because the HRA has constructed the ramp and the City will be one of the primary users, that the City should maintain the ramp and forward this to the City Council. It is his opinion that this is somthing that the City Council will not readily accept but will need to discuss. Mr. Meyer asked who maintained the area before. The City did this, and perhaps they should continue to plow the snow while the HRA provides other maintenance. Mr. Newman indicated they could work out something with the City Council but would prefer not to lose another month to resolve the title because of the maintenance issue. Mr. Rasmussen requested that Mr. Newman mention that this item would be further discussed. Mr. Newman stated he would and would have staff get cost estimates. He requested the HRA approve the agreement after deleting the second paragraph. Mr. Robertson stated that by doing this the HRA would be taking care of the title but letting the City Council know the HRA wishes to have further information regarding maintenance. MOTION by Mr. Meyer, seconded by Mr. Rasmussen, to approve the agreement as written with the deletion of paragraph 2, and further to instruct the Executive Director of the HRA and the HRA attorney to come up with cost figures and a proposal to present to the City Council to share expenses or assume total expenses for maintenance of the parking ramp. UPON A VOICE VOTE, ALL VOTING AYE, VICE- CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. HOUSING i REDEVELOPMENT AUTHORITY MEETING, APRIL 13, 1989 - PAGE 4 2. CONSIDERATION OF DEVELOPMENT AGREEMENT FOR STINSKI HILLWIND OFFICE REDEVELOPMENT PROJECT , Mr. Robertson stated that, after the an agreememnt had been reached on March 20th and after the agenda had been printed, the developer reached the conclusion that rather than the split of the grant and loan, it would be better if they went with a straight 50 grant for land assembly costs. This occurred today. The handout given to the members at the meeting outlines the agreement and indicates that developers, Mr. & Mrs. Stinski, have authorized their attorneys to agree to the proposal as outlined. Staff's recommendation is the writedown be a grant in the sum of $109,500 and the second mortgage be completely eliminated. Staff's recommendation is that, if acceptable, the HRA direct staff to do the necessary amendment to develop an agreement, proceed with closing and have the chairperson sign it. The grant would not be closed on until there is a certificate of occupancy on the building. Mr. Meyer stated the letter from the attorney talked about eliminating the provision for the developer to provide an environmental audit. Mr. Newman stated the document does, in fact, contain an environmental audit. Mr. Meyer stated the grant must be contingent upon soil correction, etc. Mr. Newman stated this is a combination of land assembly and demolition. In other situations where they have land assembly, then they use a different standard. Mr. Meyer asked, in this particular case, what does this compensate? Mr. Robertson indicated this is for removal of a structure and land assembly costs. Two parcels were combined. This is a contribution for what the developer would have to pay, and a write down to make essentially a market rate cost of the land. Mr. Newman stated that, with the quality that is proposed, it was felt there must be some assistance to be more competitive when they start out. To define the level of quality, they will reference the drawings or renderings to use as a benchmark to determine quality. Today, the developer submitted plans and specifications for approval by the building officials. The HRA will not pay the grant money until construction is completed. At that time, the HRA can determine if the quality is consistent with requirements. e v HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 13, 1989 - PAGE 5 Mr. Meyer stated the problem is to define quality before they get the process going. , Mr. Newman stated the developers have used pictorial exhibits. Mr. Meyer stated that on the Springbrook project, the HRA received an actual listing of features and amenities before the fact. They need information on the quality of the amenities that bespeak the quality of the development, and this should be part of the understanding before we actually approve. His worry is that they will find out it is not up to standard and then deny funds. Mr. Newman stated the plans and specifications can be reviewed. If they provide sufficient detail, they might well reference those plans and specifications in the agreement. Mr. Meyer did not think it still would answer whether it is high quality but it would set a requirement for the materials that go into the building and give the HRA something to compare when completed for approval. Mr. Robertson stated detailed specifications came in late the afternoon of the meeting. Plans were late and therefore could not be submitted to the HRA. Mr. Stinski stated he and his wife wished to assure the HRA that they are going to do what they stated they would and probably more. This will be one of the best buildings the City has seen. They will submit good plans and specifications and will leave the decision up to the HRA. This is a good builder and architect who have done much work in this state and others. Mr. Stinski has no problem with them. He felt the HRA would be very proud of the building, but he also understood the HRA's position. MOTION by Mr. Rasmussen, seconded by Mr. Meyer, to approve HRA support for $109,500 for the office project and direct staff to consummate the agreement according to those provisions as outlined in a letter of April 13, 1989, to Mr. Newman, with the additional direction that they list specifications, materials and renderings to define the quality, and that the Executive Director and Chairperson of the HRA are authorized to execute a final agreement, subject to the final approval of the Executive Director and HRA attorney. UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. Ms. Schnabel stated she look forward to seeing the completed building and asked if it would be ready for occupancy by September. HOUSING i REDEVELOPMENT AUTHORITY MEETING, APRIL 13, 1989 - PAGE 6 Ms. Stinski stated occupancy will probably be later in the year. The building will have approximately 31,000 square feet plus underground parking and will take about 8 -9 months to construct. 3. CONSIDERATION OF DEVELOPMENT AGREEMENT CONCEPT FOR KITTERMAN ,ADVANCE COMPANIES COMMERCIAL REHABILITATION PROJECT Mr. Robertson stated he had included copies of minutes from April 14, 1988 and May 12, 1988 when preliminary plans were reviewed from Mr. Kitterman and staff was previously authorized to work on a development agreement to review for the next meeting. As the HRA knew, Mr. Kitterman received a preliminary commitment for secondary financing through an SBA 504 loan program for $156,000, copies of which were included with the agenda. He commenced work on the project late, last summer and it was substantially completed in February of this year. He has received a certificate of occupancy and has moved into the building. Mr. Robertson stated that proposed are two modifications of HRA standard 15 -year mortgage second mortgage. First, because the SBA loan must be a second position, the HRA would be in the third position. Secondly, the SBA requires that all other financing run concurrently with their 20 -year loan. Staff recommends the same structure; that is, no payments the first three years, interest only the next two years, and then the remaining principal and interest to last 15 years. Mr. Robertson stated staff has analyzed the proposal and believes this is very low risk modification to accommodate the loan. The building is done. The value of the loan is well within the guidelines and under percentage, they normally put on a loan. Mr. Robertson spoke with Mr. Kitterman in terms of jobs created. In April 1988, he had 15 employees; on January 1, 1989 -23 employees; and he now has 30 employees. He has approximately doubled the number of employees, which is another reason to recommend approval. Ms. Schnabel thought this was very well done and looked very nice. MOTION by Mr. Rasmussen, seconded by Mr. Meyer, to approve the concept as outlined and for staff to consummate and bring back a development agreement. UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. 4. CONSIDERATION OF UNIVERSITY AVENUE CORRIDOR MAINTENANCE Mr. Robertson stated they had discussed with the City Council the option for doing the maintenance work which all agreed should U HOUSING A REDEVELOPMENT AUTHORITY MEETING, APRIL 13, 1989 - PAGE 7 It be done this year. The Public Works staff had estimated that the maintenance work, including Moore Lake and East River Road, might total $60,000 - $80,000 per year. Staff took the opportunity to explore options available since it was questionable whether the HRA could pay for the maintenance of non -HRA property. The HRA could purchase equipment, however. Bids for maintenance came in on Tuesday. The low bid was $36,700 for the entire scope of the work. Since this is such a good bid, staff recommends that the HRA not take any action at this time and recommends that the City Council take this bid without participation from the HRA. Mr. Meyer asked if this bid was for equipment. Mr. Robertson stated that equipment would be provided by the contractor. Ms. Schnabel was pleased with the bid and the fact that it included not just University Avenue, but East Moore Lake Drive and East River Road. She is interested to see how many people the contractor will have working on the project. Mr. Meyer indicated he saw nothing about weed killer. Mr. Burns stated the contract included weed control. Mr. Robertson that there will be spring application on all center medians and boulevards. Mr. Meyer stated he did not see weed control for crab grass, which also need to be treated. He asked if the cost included the cost of a pre- emergent crab grass killer, which must be applied soon to be effective. Mr. Robertson stated he would check into the question. 5. CONSIDERATION OF PARKING RAMP SETTLEMENT Mr. Burns stated that the agreement with Park Construction provides that the City will pay $18,500 toward the reconstruction of the lower level parking garage. This is approximately one -third of the estimated amount for reconstruction. We do feel, however, that this is a pretty good figure in view of the fact that another contractor had quoted $80,000 for the same work. Mr. Rasmussen asked who is responsible for the error. Mr. Burns stated the City accepted one -third of the responsibility. In order to determine responsibility, the City held a meeting with the various persons that were involved. Mr. Burns said that he felt some of the problems lay with the architect and the construction manager. The architectural drawings did not have a great deal of detail and were considered barely acceptable. No HOUSING & REDEVELOPMENT AUTHORITY MEETING# APRIL 13, 1989 - PAGE 8 interior elevations were marked and no architect's inspector was present during the critical phases of the project. The other problems were created by the construction manager who became involved in setting elevations for the concrete sub- contractor. Mr. Burns also indicated that he felt the construction company also owned a major share of the responsibility for the problems that existed on the lower level ramp. It was pointed out that the sub- contractor used a wet screeding process that resulted in improper elevations and a very rough finish. Mr. Burns stated that in addition to the settlement of responsibility for the reconstruction of the lower level ramp, several other issues were negotiated with Park Construction during meetings with Mr. Burns. The second issue was that of delay in the concrete work. For a number of reasons, the work that Park Construction was to perform was forced into the winter weather of 1988. Although the City's contract with Park Construction provided for a December 1, 1988 completion of the concrete work, much of the work was not completed until after the end of the year. In recognition that winter concrete pouring costs more money, the City recognized the additional cost for Park Construction. Mr. Rasmussen asked if the City should have been notified of the additional cost before they started. Mr. Burns indicated the City was notified. Some of the problems had to do with the grading contractors. An electrical line was not moved in a timely manner. Grading in another section of the project prevented the completion of ramp- related grading that was needed to accommodate the concrete subcontractor. According to Mr. Burns, Park Construction initially asked for approximately $13,000 in compensation for delays. The City settled for $10,702. Reductions consisted mainly in overhead charges that were added to the costs for blankets, the heating of concrete, rental of heaters, gas for heaters, and time to put up a plastic sheeting enclosure. Mr. Burns stated the third item was $3,800 for Kevin Kahmann. He stated that the grading had not been done to Kevin's satisfaction. As a result, Kevin came in on Saturday and Sunday and, with his own personnel, brought the grades down to where he thought they should be. He is now asking for reimbursment of $3,800. The City, however, is not accepting responsibility. It will do what it can, however, to bring about an agreement. Mr. Burns stated the fourth item has to do with identical incidental expenses that Kevin Kahmann claimed had been authorized by Mr. Jim Eichman. Mr. Kahmann claimed he was authorized to use an accelerant to speed the concrete cure, remove snow, and fill holes in concrete, etc. Altogether, $2,106 worth of items were authorized. While City staff tended to agree that these items were subject to reimbursement, they insisted that the requests be reviewed by the current project coordinator. HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 13, 1989 - PAGE 9 Mr. Burns stated the concrete was to be taken out and replaced in two weeks. As of last Thursday morning, about half had been removed and the remainder was to be done the next day. This time around Park Construction will supervise the pouring of the concrete more closely. Additionally, Boarman and Associates will be there to inspect the work product. They have, incidentally, indicated they will use a wet screeding process for the repour. Hopefully the supervision that will be present for the repour will serve to eliminate any problems similar to those that occurred with the original pour. Regarding the $3,800 issue, staff is trying to schedule a meeting with Gammon Brothers, Park Construction and Kevin Kahmann to determine whether or not a voluntary agreement can be reached. Mr. Burns also indicated there is also one other issue with Gammon Brothers that he hopes to resolve through this meeting. In regard to the $2,106 in items that are claimed by Kevin Kahmann for reimbursement, City staff has asked Park Construction to have Kevin document all reimbursement items and submit them to the City. Mr. Rasmussen asked if this would be one comprehensive settlement. Mr. Burns stated that the $10,702 payment and the $18,500 payment to Park Construction that was mentioned above, would be included in a single change order that would be considered by the City Council at its first meeting in May. The other items would be considered separately. Mr. Rasmussen did not want to see additional expenses and preferred that the settlement be filed. Mr. Meyer stated there is always the potential that there will be a few thousand dollars in question. Mr. Burns stated there is the potential for $2,106 in additional costs. Other than that, it is a "done deal" and the change order will be awarded in "done deal" language. Mr. Meyer asked if reinforced steel is being used in the concrete. Mr. Burns stated that it was. He did mention, however, that Mr. Flora has talked about increasing the thickness of the concrete from four inches to five inches and also about eliminating the reinforcing steel. Mr. Meyer stated that any reinforcing steel needs to be epoxy coated. He requested that Mr. Flora check the specifications to be sure that the steel is epoxy coated. This should be brought to the attention of the architect and the architect should reply back to the City. Mr. Burns stated that, as part of this settlement, he did talk with Virgil Herrick and ask him to evaluate the chances of the City in arbitration. In view of his conversation with Mr. Herrick, he felt the negotiated settlement was probably better than what the City would have achieved through arbitration. HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 13, 1989 - PAGE 10 ° Mr. Burns stated the City met separately with Boarman to review a list of errors and omissions and to hear their explanations. After this meeting, Boarman agreed to share some of the responsibility, but, as yet, have not responded with any commitment to a definite amount of money. Staff did state that the City was willing to go to arbitration with Boarman to claim half of the $18,500 that the City is obligated to pay for reconstruction of the lower level ramp. Mr. Meyer stated it is difficult to go against the architect and engineer. There is the argument that if elevations are lacking, someone could call and check and these are standard in the industry. Some of these arguments are weak, but if the City can get something from Boarman, they should do so. Mr. Burns stated, if possible, the City would also try to get something from Bossardt- Christenson. MOTION by Mr. Meyer, seconded by Mr. Rasmussen, to approve the settlement between the HRA and Park Construction as outlined on pages 5 -5A of the agenda. UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. 6. INFORMATION ON DRAFT CAPITAL IMPROVEMENTS PLAN Mr. Robertson stated this was an informational item. At the last meeting, Mr. Burns indicated the City was starting a capital improvement program which will be more detailed and explicit than in the past. The information provided for the HRA's review and comment during the next month is the capital improvements plan from 1986 and 1987, and a summary draft in the more detailed format that Mr. Burns is instituting. Mr. Robertson stated there are seven different categories and a summary of worksheets for the five years in each of those categories. What Mr. Robertson has endeavered to do is include all the projects and their most realistic schedule as previously adopted and then to add other projects out in 1991, 92, 93, 94, as were identified as part of Council's goal setting exercise several months ago. HRA members were asked to review these items in the next few weeks and call him with questions, comments and suggestions. An update will be provided as we proceed. Page 6A is the schedule. There will be public review and conference review before final adoption by the City Council. Mr. Burns indicated that the process is behind schedule. Council review in #4 is now scheduled for April 24, so everything will be moved back about one month. 7. INFORMATION ON DRAFT HRA OBJECTIVES FOR 1990 HOUSING & REDEVELOPMENT AUTHORITY MEETING, APRIL 13, 1989 - PAGE 11 Mr. Robertson stated that each department was asked to prepare a statement of objectives for review by the City Council and came up with about 10 objectives which were gleaned from earlier discussions of the HRA. Staff was asked to present what they felt were the top four priorities, which are listed on Page 7. The City Council felt the top priority they want addressed is to resolve the stalled development agreement at Lake Pointe. In the information packet, the HRA received a copy of a letter from Mr. Raymond Haik to Woodbridge which summarizes the discussions to date. Staff is authorized to test the market to confirm Woodbridge's assertion that since 1985 the market has changed and determine realistic alternatives. Mr. Robertson will proceed by talking to some top leasing and development firms in the area. Mr. Meyer asked if there were any legal inferences because the market has changed or is changing. Mr. Robertson did not think so. One thing that did come up during discussions was there are some very lucrative incentives for Woodbridge to proceed under the existing Limited Revenue Note. 8. INFORMATION ON SENIOR HOUSING SURVEY Ms. Dacy invited Ms. Pat McCullough, HPMR, to provide a synopsis of the study and then Ms. Dacy will summarize discussions of the Planning Commission and the Human Resources Commission. They are looking for comments and questions from the HRA which will help in developing recommendations for policy alternatives to finance senior housing projects. Ms. McCullough stated they had done some standard projections looking at the social- demographic characteristics of the seniors in the City of Fridley. A relatively extensive survey was mailed to all households with heads of households 65 and older and asking questions on housing, which was supplemented by focus groups. City of Fridley had 55% response rate which is excellent. They concluded the study saying there is an immediate demand for 72 units of congregate housing to serve seniors in the City of Fridley. According to the survey response looking both at what they perceived they could afford to pay and at looking at their incomes, it is recommended that 80% of the units be in the low and moderate income range, $300 on the low side to the mid -$600 range on the high side. Ms. McCullough stated the balance of the study was an indication of interest and need for congregate housing for people who are able to pay more and who did not wish to leave the City. In 1993, that demand more than doubled to 155 units of housing, applying the same survey response rate to that general housing. Ms. Dacy asked them to look at a 10 -year forecast. When they HOUSING 8 REDEVELOPMENT AUTHORITY MEETING, APRIL 13, 1989 - PAGE 12 looked at the 55 to 64 year old population that would exist in 1993 who would be moving into the senior population, the demand will double again because there is a high number in those Categories. Those who would like options to remain in the City have a strong interest in hoping options could be provided so they would not have to go to a neighboring community. Village Green has five year waiting list. All subsidized housing surveyed was full and a one to two year waiting list is not uncommon. Mr. Rasmussen asked about the building in Robbinsdale across from the First National Bank. Ms. McCullough did not think there was a subsidized building in Robbinsdale. Copperfield Hill has done reasonably well. She will check further. Ms. McCullough stated the Twin City area has market rate housing that is available at the high end of subsidized. Earl Brown Commons is doing poorly. These projects do not fill like a typical apartment building. Financial institutions now require projections for a three to four year fill rate for a moderate sized project. This is because moving is a longer decision making process for seniors and the last decision people will make regarding housing. Ms. Schnabel asked how may communities have more than one subsidized unit in the city. Ms. McCullough indicated the Met Council has prepared detailed inventories of subsidized housing in the metro area. There is not a lot that would have multiple units unless they were very aggressive in the early periods of development. For example, the HUD 202 program allocated about 100 units for State of Minnesota, and they did not want more than 50 units in any single project. Fridley is not a priority community. Most communities are not considered a priority unless the number of units requested is extremely high. Bloomington is a priority. Unless communities are on the priority list, they do not apply. Ms. Schnabel asked, if there is a need, should or should not the units be subsidized. Ms. McCullough recommended looking at, as you are presented with requests for developing projects, some communities are looking at protecting certain units in the building to be available to qualify for the HUD moderate to low income units. It is a very difficult issue because one is looking at a program the Federal government heavily participated in but now you must look at it closely at the responsibilities involved because they are significant. HOUSING A REDEVELOPMENT AUTHORITY MEETINGo APRIL 131 1989 - PAGE 13 Mr. Rasmussen thought some of the market rate housing will become more affordable in terms of rates as time goes on. Ms. McCullough stated she had worked with some financial people and did some projections for a luxury high rise. They have filled about 20% of their units and have been open for a year with marketing for a year or two before opening. Analysts are looking at striking some kind of deal for low income. Dakota County actually passed a mill levy that will be devoted to housing. The HRA is going to participate in development so they don't have to participate in HUD rules. They are looking at options to make housing affordable and available in the community. Mr. Newman referred to page 8D in the agenda and stated the assistance provided by the City for Golden Pond was actually closer to $1 million. Ms. McCullough stated that seniors generally don't want regular apartments for a number of reasons. They have a more itinerant population, greater concerns about security, congregate housing brings in services that link seniors with services that are in the community, and have social space available. These are significant policy issues to think about because there are no immediate expectation that the decline in Federal participation will continue as in the previous administration and no great hope that we will go back to the HUD 202 programs. Fridley is one of the few communities that does not have non - subsidized project that is developed in the community. Mr. Dacy stated that the Planning Commission discussed two points. First, one of the commissioners asked staff to look at the assumption that higher income seniors prefer a different type of housing than lower income seniors. No clear pattern is shown. As a whole, the majority seemed to prefer a one -story town home with outside entrance. Secondly, two projects that have been before the city have been on vacant property. Perhaps should look at existing units to provide amenities over time to encourage rehabilitation into senior housing. She is hoping to take a proactive approach for preferences for locations for senior housing. Ms. Schnabel stated that another feature to consider is facilities that are attached to nursing home facilities. There is a certain point where this becomes a very important feature. There is also a nursing home located by Georgetown. Ms. McCullough stated that Minnesota has a moratorium on the construction of additional nursing home beds enacted in 1984, and at the last legislative session, studies indicate there is no need to lift that moratorium. In 1984, nursing homes were 97% occupied. That gives them time to get rooms ready. The fastest growing segment of Minnesota's population is 85 and older and this group HOUSING 6 REDEVELOPMENT AUTHORITY MEETING, APRIL 13, 1989 - PAGE 14 4 " uses nursing homes at triple the rate of those under 85. The moratorium was imposed and money was put into alternative care sytem for other services. To date, no nursing homes have been built in the State of Minnesota. The system is now about 92% occupied and feel this will be less in a few years. We are enabling older persons to have a greater number of choices after they can no longer manage a single family home. Assisted living units are the biggest thing right now. Ms. Dacy requested comments from members during the next 30 day period because in order to develop some recommendations for the City Council and HRA to consider. The goal is to complete by June. Ms. Schnabel asked how many developers are waiting. Ms. Dacy stated they had not heard from EMC regarding the St. Williams project. Mr. Robertson stated he has received inquiries from other developers who have proposed the same type of construction for one story, private entrance housing. 9. INFORMATION ON 1988 ANNUAL REPORT Mr. Robertson stated members have been given new drafts of the 1988 Annual Report. The copy was updated today. Printing of the report was deliberately held off at the end of the year because we had the Tanurb and 57th Place projects under discussion and wanted to make sure they went before going to press. However, it is now April and we have to do the 1988 report. The report is scaled back. If there are comments or suggestions for changes, please present them in the next week. Ms. Schnabel has read the report and made some changes. The report this year will be about the same as last year, but a little less elaborate because we have less to report. Mr. Meyer asked if it was the intent to feature Target, Village Green, etc. Mr. Robertson stated, yes, they would be featured. This is a summary of progress to date and will use the report as a marketing tool. It has been three to four years since we have reminded the readers and developers in this area about our accomplishments. Mr. Meyer felt Springbrook could be included since it is newer than some of the others that are shown. Mr. Robertson said it was featured on the cover last year but thought that it might be one thing they could add. Since the copy was done, Mr. Robertson had a representative from Minnesota HOUSING i REDEVELOPMENT AUTHORITY MEETINGS APRIL 13# 1989 - PAGE 15 Corporate Report visit and will come back with a suggested marketing strategy for the next five years. That should be available for the next month's meeting and will be Out on the agenda. Because of the number of members present, the picture that was taken last month with four members present will be the photo used in the report. 10. CLAIMS 1876 -1884 Ms. Burt presented claims 1876 -1884. The tax increment payment, Check #1883, has been written and will be going out tomorrow. Mr. Burns indicated that Shakopee is the only city ahead of Fridley providing the tax increment payment to the local school district. MOTION by Mr. Rasmussen, seconded by Mr. Meyer, to accept Check Register Nos. 1876 -1884. UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. Ms. Burt stated that the shared cost of senior housing study was included on the billing for personal services for March, 1989. ADJOURNMENT Vice - Chairperson Schnabel adjourned the April 13, 1989, meeting of the Housing and Redevelopment Authority at 8:50 p.m. Respectfully submitted, � A Pp-y, It) Lavonn Cooper % Recording Secreta y E ngrn CCr nlj sewer Water Parks Streets M211ntenancc MEMORANDUM TO: Jock Robertson, Community Development Director PW89 -97 FROM: Jon Thompson, Estimator & Construction Inspector DATE: April 28, 1989 SUBJECT: Landscape & Irrigation Improvements - Street Improvement Project No. ST. 1988 - 1 & 2 The terms of the development agreement between the Fridley HRA and Northwest Racquet, Swim & Health Club, Inc. and Moore Lake Associates stipulates that $95,000.00 of landscape and irrigation improvements are to be installed by the City. Due to favorably low unit prices, $79,184.00 is the total of the scope of the work as bid. To satisfy the agreement, we are proposing a change order for the addition of thirty -two (32) Prairie Fire Crab Trees at $157.50 each, sixteen (16) Sugar Time Crab Trees at $157.50 each and 5,225 Sq. Yd. of Sod at $1.58 per Sq. Yd. for a total amount of $15,815.50. Recommend the Fridley HRA approve this change order at the May 11 meeting so that it may be processed by the City Council at their May 15, 1989, meeting. JT /ts FIi1D11Y v 1 =A ARTICLE IV Improvements Section 4.1. Public Improvements by the Authority. Upon . the execution of this Agreement, the Authority agrees' to complete those public improvements described in the Public Improvetrient•Petition, which are more fully described in -City of Fridley'Street Improvement Project No.. ST 1988 - 1 & 2 which public improvements shall be substantially completed by the Authority on or before December 1, 1988. The Company shall not be charged or assessed for the cost incurred by the Authority in constructing these public improvements except as is provided for in the Public Improvement Petition. Section 4.2. Company Guarantee. As an inducement to the Authority to construct the public improvements referenced in Section 4.1 above, each respective Company agrees to substantially complete on or before eighteen (18) months from the execution of this Agreement the exterior construction of the respective buildings on Parcels A and B. This obligation is in addition to the covenants contained in Section 5.3. In the event that either Company fails to substantially complete the exterior construction of the building on their respective parcels within this time period, then if the failure is by Northwest Racquet then Northwest Racquet shall pay to the Authority 308 of the unreimbursed costs incurred by the Authority in constructing the public improvements referenced in Section 4.1, but in no event not more than $360,000, and if the failure is by Moore Lake Associates then Moore Lake Associates shall pay to the Authority 708 of the unreimbursed costs incurred by the Authority in constructing the public improvements referenced in Section 4.1, but in no event not more than $840,000. _ ection 4.3 Landscape Improvements. As part of the Public Improvements the Authority agrees to construct and install certain landscaping of a dollar value not less than $95,000. Prior to awarding contracts for the construction and installation of this landscaping, Moore Lake Associates shall have the opportunity to review the design and specifi- cations for the landscaping and to further provide to the Authority comments on the landscape design. If Moore Lake Associates does not provide any comments to the Authority within seven days of notice from the Authority that the landscape plans are available for review, then it shall be presumed that Moore Lake Associates concurs in the proposed landscape plan. Section 4.40 Landscape Maintenance. Prior to the con- veyance provided for in Section 3.1, the Company agrees `to execute the Landscape Maintenance Agreement, to obtain all additional signatures which may be required by the agreement and to abide by its terms. 4 - 1 • r . e «�ea.•ea• awraa EXHIBIT C ).1 f J' 0 GD GD Ge ea G@ O R` soon Lan ..aa... aar a aaus sea i Oft-AV A, • ' use too" aaa.r.oeaaraa � I 1 -B -AVpmq,.N .&L- So5> PP97 RnzeAASD IusrALA.ep lu 3 O r N • • as aaaaft &IBM PROJECT DATA MOORE LAKE COMMONS EAST Retail/Offica Canter area (1st h"D 41,925 an Office Area (Yid level) 17,260 a/[ MOORE LAKE RACQUET 8 SWIM CLUB TOTAL Area 55,183 an Building Ground Boer Area 160,000 all Parkins 296 TOTAL Building Area (7 levels) 200,000 a/f Parking 379 L. CITY OF FRIDLEY ENGINEERING DEPARTMENT 6431 UNIVERSITY AVE., N.E. _ FRIDLEY, MN 55432 May 15, 1989 C.S. McCr•ossan • Const .. Co . , Inc. P.O. Box :'247- Maple Grove, MN .55369 SUBJECT: Change Order No. 5, Street Improvement Project No. ST. 1988 - 1 & 2 Gentlemen: You are hereby ordered, authorized, and instructed to modify your contract for the Street Improvement Project No. ST. 1988 - 1 & 2 by adding the following work: Addition: APPROX. ITEM QUANTITY PRICE AMOUNT 1. Prairie Fire 32 ea. $157.50 $ 5,040.00 Crab Trees 2. Sugar -Time Crab Trees 16 ea. 157.50 2,520.00 3. Sod 5,225 sq. yd. 1.58 81255.50 TOTAL ADDITIONS . . . . . . . . $ 15,815.50 TOTAL CHANGE ORDERS: Original Contract amount. . . . . . . . . . . .$ 851,807.20 Contract Additions - Change Order No. 1. . . . 13,901.00 - Change Order No. 2. . . . 22,857.30 - Change Order No. 3. . . . 52,095.50 - Change Order No. 4. . . . 47,109.75 - Change Order No. 5. . . . 15,815.50 REVISED CONTRACT AMOUNT $1,003,586.25 C.S. McCrossan Const. Co., Inc. Page Two Change Order No. 5 May 15, 1989_ Submitted. and approved by John G. Flora, Public Works Director, on the 1155th day of , 1989. Ir d by Flora, P.E. or of Public Works Approved and accepted this o� day of L U , 1989, by Approved and accepted this 1989, by C.S. 1�MCCROSSSSAN CONST. CO., INC. ' g' -Ve� Thomas Kenney, Pr t Manager day of � , CITY OF FRIDLEY William J. Nee, Mayor William W. Burns, City Manager 1 -D ` 1L ERRICK & NE V MA JA V ATTORNEYS AT LAW Virgil C. Herrick James D. Hoek May 3 , 1989 Gregg V. Herrick Of Counsel David P. Newman. Jock Robertson City of Fridley 6431 University Avenue N.E. Fridley, MN 55432 RE: Fridley HRA /Boisclair Dear Jock: I am writing to request that the HRA schedule some time at its upcoming meeting for the purpose of discussing the approach it would like staff to take pertaining to the redevelopment of the southwest quadrant at Mississippi and University Avenue. I have had an opportunity to informally review with Jim Casserly the concept that Bob Boisclair has proposed to the HRA. I should caution you that Jim has not yet done any formal analysis of the numbers and will not do so until directed by you. However, out of curiosity he has informally reviewed the proposal and passed onto me the following observations: 1. The concept which is proposed would have a total market value of approximately $25,000,000 to $30,000,000. (This is consistent with the concept which the HRA was originally looking for several years ago.) 2. The developer is requesting assistance in the range of $8,000,000 to $9,000,000. Our initial reaction is that this is not excessive. As you will recall, our concern with the Lundgren proposal was that the market rates were in excess of what the local market could support. Jim's reaction is that this level of assistance is probably necessary in order for the project to be viable. 3. That the project will be several million dollars short in the revenue that it will generate to fund the assistance which the developer is requesting. Since Jim has not done a formal analysis he can not give you any exact number as to the amount of increment that the project will generate. However, it is his assumption that the increment which will be generated will be several million dollars short of the amount of assistance that the developer is requesting. Suite 205, 6401 University Avenue N.E., Fridley, Minnesota 55432, 612 -571 -3850 Q Jock Robertson May 3, 1989 Page Two Due to the nature of the development proposed, it is Jim's reaction that the level of assistance being sought is not unreasonable. This presents a policy question that the HRA. needs to. resolve. If in fact they would like to have a development of the nature and quality that Bob Boisclair is proposing, then they will.-Wave to•be prepared to provide assistance of several million`doilars beyond the increment that this or any similar project will generate. If the HRA is not prepared to do this, then they need to recognize that the type of development which would likely occur will be.more consistent with what Tanurb was proposing. (Please keep in mind that even on the Tanurb proposal, we were having difficulty generating enough increment in order to make the project financially feasible.) This really is a question that the HRA needs to address immediately. Currently, Mr. Levy is talking to 3 different developers about this site. In all fairness to them, we need these questions answered by the HRA so that we can provide both the developers and the property owner with some parameters of what the HRA is willing to do. This is also a question that the HRA needs to quickly resolve in fairness to itself. Due to the limited life of the district, the amount of increment available for assistance is reduced by every year that passes. Consequently, if we continue to wait the amount of increment available will be reduced. It is my understanding that after review, the staff is recommending to the HRA that they do not adopt a policy whereby the HRA would use outside increment for the support of any development on this parcel. The reasons are as follows: A. Frankly, it does not appear that the HRA currently is in a strong enough financial condition where it can firmly commitment to borrow several million dollars from outside a project area. Due to the status of our other projects any execess funds may be needed elsewhere. B. While this project certainly is outside of the project area for increment, you will be setting developers will attempt to use (i.e. 57th and University) a priority, by going the purpose of captur' a precedent that othe for other projects. C. The HRA and the City Council have already determined that their number one priority is the 100 Twin site. Consequently, to the extent that additional funds are necessary to make a project work, it would appear that these funds should be reserved for the 100 Twin site based on the priorities that have already been established. 2A Jock Robertson May 3, 1989 Page Three It is my understanding that Mr. Boisclair will be available at the Thursday HRA meeting for the purpose of providing to-the HRA a description of the general concept which he is proposing. I would .suggest that after this proposal the HRA should discuss their philosophical approach to this project so that both the staff and -the developers will have a better sense of the guide- lines that the HRA would like them to operate within. Jim Casserly has also indicated that he would be very willing to be present at the meeting for purposes of discussion in the event you felt his presence would be beneficial. I incer y yours,* vid P. ewman DPN:jeb 2 -B OUSING and REDEVELOPMENT AUTHORITY 3 COMMISSION MEMBERS: LAWRENCE COMMERS, CHAIRMAN DUANE PRARE VRGNIA SCHNABEL WALTER RASMUSSEN JOHN MEYER CITY OF FRIDLEY DATE: `. May 2 , 1989 TO: Housing and Redevelopment Authority FROM: Jock Robertson, Executive Director of HRA SUBJECT: Information on Boisclair Corporation Redevelopment Concept for Southwest Quadrant of University and Mississippi Street On April 21, 1989, Dave Newman and I met with Mr. Bob Boisclair of the Boisclair Development Corporation and Mr. Richard C. Bienatfl of the Waterford group to discuss a proposal for a mixed use housing and retail development on the southwest quadrant (see attached cover letter). At that time, they submitted an extensive financial analysis which was subsequently supplemented with another mailing dated April 24. At the time of our meeting on April 21, I informed Mr. Boisclair that although we were very interested in reviewing his proposal, we needed a preliminary fee payment of $5,000 to cover the consultant's cost for the financial analysis. Mr. Boisclair is out of town this week. We have not yet received payment of the $5,000. I have left a message with Mr. Boisclair's office and have instructed Mr. Newman to answer any inquiries or receive the funds if advanced by Mr. Boisclair and authorize Mr. Casserly to proceed with the financial analysis. JR:Is EXECUTIVE DIRECTOR: JOCK ROBERTSON 6431 UNIVERSITY AVE. (0 12) 571 -3450 FRIDLEY, MN 55432 EXT. 117 DEVELOPING OUAUTV INVESTMENTS IN REAL ESTATE April 21, 1989 HOUSING AND REDEVELOPMENT AUTHORITY FOR THE CITY OF FRIDLEY Mr. Lawrence Commers, Chairman 6431 University Ave. Fridley, MN 55432 ATTN: Mr. Jock Robertson, Executive Director RE: CONCEPT DEVELOPMENT PROPOSAL - Housing & Retail - Mixed Use Project Mississippi Street & University Ave. Dear Mr. Robertson: We respectfully submit for The Housing and Redevelopment Authority of Fridley consideration, the following Concept Development Proposal for a mixed use project at the above referenced site for the following uses: Market Rate Housing: Subsidized Housing: Retail: ALTERNATE I PHASE I 150 Dwelling Units 75 Dwelling Units 55,000 Square Feet TOTAL PROJECT COSTS (including Phase I & II) PHASE II 60 Dwelling Units 15 Dwelling Units 30,000 Square Feet 3 =A $ 27,200,000 ONE MAIN STREET S.E. a SUITE 600 • MINNEAPOLIS, MN 55414 • PHONE: (612) 623 -9739 WJ CONCEPT DEVELOPMENT PROPOSAL HOUSING AND REDEVELOPMENT AUTHORITY - CITY OF FRIDLEY Page Two Market Rate Housing: Subsidized Housing: Retail: ALTERNATE II PHASE I 152 Dwelling Units 38 Dwelling Units 55,000 Square Feet PHASE II 60 Dwelling Units 15 Dwelling Units 30,000 Square Feet TOTAL PROJECT COSTS (including Phase 16 II) $ 25,915,000 The architectural concept is envisioned to address the critically important integration of housing with retail without the slightest adverse impact to either use. Column placement, efficient service and dockage areas, ample parking, bay depth and signage are just a few of the retail design issues that require solutions uncompromised by the housing above. Meanwhile, sense of place and arrival, secure separation from the retail without a feeling of isolation, views, and endeavoring to soften the surrounding environment by use of ample landscaping, textured surfaces, subdued streetscape and building materials become equally critical when planning for the needs of the residential. A sense of place shall be symbolized by a small urban park (at the fulcrum of the intersecting streets) featuring perhaps a fountain and a project monument. The graceful stepping of the nine -story tower to four stories further strengthens the residential sense of place. 3 -C CONCEPT DEVELOPMENT PROPOSAL HOUSING AND REDEVELOPMENT AUTHORITY - CITY OF FRIDLEY Page Three Our architectural firm, Miller Hanson Westerbeck & Bell, who has designed Riverplace, Galtier Plaza, and Market Plaza, has already studied some of these issues represented by our preliminary site plan and work models. We also submit our initial financial projections, including subsidy needs, that require further study with respect'to market and construction cost data. However, we believe the projections at this early stage represent, with a reasonable level of accuracy, a reflection of the needs of the project. Although the subsidy identified is substantial, we are pleased to note our proposed project, when compared to the recent Tanurb Development Company's 100,000 S.F. retail project, is only 6.1% greater relative to the public and private investment ratio proposed by our respective projects: Total Project Costs: Total Subsidy: Public Investment Ratio: BOISCLAIR CORPORATION TANURB DEVELOPMENT CO. $25,915,000 (Alt. II) 8,360,000 32.3% $11,000,000 2,880,000 26.2% Housing Projects traditionally require greater subsidies due to the combined negative influence of: a) Less economic cash on cash investment return than retail. b) Greater construction costs building heavy construction compared to competing wood frame projects. n CONCEPT DEVELOPMENT PROPOSAL HOUSING AND REDEVELOPMENT PROPOSAL - CITY OF FRIDLEY Page Four You will -note Alternate II is almost the same as Alternate I with respect to the degree - of- public assistance. The key destinction between the two is how a compensation method is generated on behalf of the project sponsors for undertaking the risk of the project without realistic cash flow expectation from the housing. Since the Tax Reform Act of 1986, there is no ability to create development incentive to build rental housing except by: a) The sale of federal and state tax credits permitted by building qualifying low and moderate income housing, thus generating development incentive needed to undertake the risk (Alt. I). b) Provide, within the debt, a developer's fee equivalent to proceeds otherwise generated by tax credit syndication (Alt. II). With respect to the subsidies needed, the project will generate $517,000 (Alt. II) of new annual taxes. However, due to the capital subsidy required, additional tax increment of $649,000 is also needed to pay off the bonds within 15 years. Both Alternate I & II's operational subsidies cease at the end of ten years. Due to time constraints relative to today's meeting with you, we were not able to project the long term benefits realized by our proposed project compared to Tanurb's. However, we believe on a present day value basis, over a 30 -40 year period, the City of Fridley benefits much greater with respect to new taxes generated relative to the respective costs and benefits of Tanurb's and our proposed projects. We will provide you this analysis next week. 3 =D n CONCEPT DEVELOPMENT PROPOSAL HOUSING AND REDEVLOPMENT AUTHORITY - CITY OF FRIDLEY Page five This proposal is respectfully submitted at a high clarity level relative to it's subsidy -needs and their underlying assumptions supporting them. Our purpose, hopefully, is to facilitate your review of our proposal's merits as soon as possible due to the landowner's insistence for us to commit significant firm, at risk, earnest monies prior to us securing a formal subsidy commitment from the City of Fridley. My general partners, and we, are not able to do so until we have obtained at least a relatively high "comfort level" of this proposal's feasibility. Mr. Richard Bienapfl of Waterford Group, who has assisted us in this proposal, will participate with us, also, if we are privileged to proceed. Both Mr. Bienapfl and the undersigned look forward to responding to your comments and recommendations relative to this proposal. We also look forward with great enthusiasm to working with The Housing and Redevelopment Authority for the City of Fridley in a public /private partnership that is assured to realize a development the City, the community, and we can be proud of for years to come. ;Since ly, ert J. isclair ISCLAIR CORPORATION cc: Mr. Jock Robertson, Executive Director Mr. James Casserly, Financial Consultant Mr. Duane Prairie, Commission Member Ms. Virginia Schnabel, Commission Member Mr. Walter Rasmussen, Commission Member Mr. John Meyer, Commission Member 0558A • 3 -E F] OUSING and REDEVELOPMENT AUTHORITY 4 COMMISSION MEMBERS: LAWRENCE COMMERS, CHAMMAN DUANE PRAMS VIRGNIA SCHNABEL WALTER RASMUSSEN JOHN MEYER CITY OF FRIDLEY DATE: ' .: .- May ;3, 1989 TO: .Housing and Redevelopment Authority FROM: Jock Robertson, Executive Director of KRA SUBJECT: Status of Development Agreement.for Stinski /Hillwind Project Included in the packet is the draft development agreement for the above referenced project. At the April 13, 1989, meeting, the HRA approved $109,500 in assistance for the project subject to the agreement specifying the building materials and that renderings be attached as exhibits. The Executive Director and Chairperson of the HRA were also authorized to execute the final agreement. As of the writing of this memorandum, the final form of the development agreement has not been submitted to Mr. Newman. In the meantime, the developers have submitted a building permit application. It was determined that a height variance was needed, because the building is proposed at 52 feet, and the CR -1 Office District permits a maximum height of 45 feet. The Appeals Commission will consider the variance request on May 9, 1989, and the City Council will consider it on May 15, 1989. The agreement will not be signed until Mr. Newman and I determine that all HRA.stipulations have been met. JR:Is M -89 -210 EXECUTIVE DIRECTOR: JOCK ROBERTSON 6431 UNIVERSITY AVE. (6 12) 571 -3450 FRIDLEY, MN 55432 EXT. 117 HERRICK & NIEWX-kN ATTORNEYS AT LAW a Virgil C. Herrick lames D. Hoek Gregg V. Herrick Of CnUMWI Divid P. Newman April 25, 1989 Neil Polstein Hillstrom & Bale, Ltd. 607 Marquette Avenue, Suite 400 Minneapolis, MN 55402 Patrick Fischer O'Neill, Burke, O'Neill Leonard & O'Brien 800 Norwest Center 55 East Fifth Street St. Paul, MN 55101 RE: Stinski /Hillwind Road Project Gentlemen: 4" Enclosed you will find a revised Contract for Private Development in the above matter. This agreement has been revised to reflect the fact that the HRA will provide $109,500.00 in assistance at which time that the project has been completed. You will note that there still remain a number of blanks which need to be completed. I would appreciate it if you would obtain this information and forward it onto me. The HRA at its April 13, 1989 meeting approved the above agreement. Consequently, once this agreement is in final form, the appropriate officers will be able to immediately execute it on behalf of the HRA. I would appreciate receiving your comments after you have reviewed this matter. DPN:jeb Enclosure cc: Jock Robertson James Casserly Sincerely yours, David P. Newman (copy of encl.) (copy of encl.) Suite 205, 6401 University Avenue N.E., Fridley, Minnesota 55432, 612 - 571 -3850 4 -A k, s' MEMORANDUM DATE: May 1, 1989 TO: Jock Robertson, Executive Director of HRA FROM: Jon Thompson, Estimator & Construction Inspector SUBJECT: Crab Grass Control, Corridor Maintenance Project #190 The question has been raised about crab grass control on Corridor Maintenance Project #190. After discussing this matter with MnDOT and Anoka County personnel and the Fridley Park Foreman, it was the unanimous conclusion that no spraying for crab grass should be done because too many bare spots with no vegetation may cause dust problems and an unsightly appearance. The area will be sprayed for dandelion control. Some areas along the fences and signs will be sprayed for weed control. JT:ls ,-Pill A • MEMORANDUM 2 DATES May 2, 1989 TO: '' Jock Robertson, Executive'Director of HRA FROM: Jon Thompson, Estimator & Constructon.Inspector 808JECT: Lake Pointe Maintenance Project #187 As per the contract, Greenmasters, Inc., is requesting payment.:for the pay period of April 15'to May 15, 1989. I recommend that the Fridley HRA authorize payment to Greenmasters, Inc., for Estimate #1 in the amount of $4,644.14 :G. JT:ls IN ..0 t -A -1.M -S - (AT MEETING) 7 P. t-n rn Z O a 00 �o rn (D ti m (D w U O fi R+ 0 o �, Ln m Q � F- n � � a � m T *--I F rJ 3 m a r c-� m c 0 7 0 0 z m 3 rn CITY OF OUSING and REDEVELOPMENT AUTHORITY COMMISSION MEMBERS: LAWRENCE COMMERS, CHAIRMAN DUANE PRARE VRGNIA SCHNABEL WALTER RASMUSSEN JOHN MEYER LEY D11TE : May 3, 1989 TO: Jock Robertson, Executive Director of HRA FROM: Barbara Dacy,*. Planning Coordinator SUBJECT: Status of 57th Place Soil Reports I contacted the MPCA office on May 4, 1989. Delta Engineering is obtaining approval from adjacent property owners "downstream" to conduct additional borings and install monitoring wells. These tests are necessary to determine the extent of underground contamination, if any, downstream from the Rapid Oil site. Delta did not indicate to the MPCA which sites it would be testing, but the Hardees site is downstream and may be a good guess. Delta will be-conducting these tests the second week in June. The report will be submitted to the MPCA by the end of July. The MPCA's analysis will take 30 -45 days after the report's submission. BD:ls M -89 -211 EXECUTIVE DIRECTOR: JOCK. ROBERTSON 6431 UNIVERSITY AVE. (Q 12) 671 -3460 FRIDLEY, MN 55432 EXT. 117 'E I RRICK & INEI "NLA- N ATTORNEYS AT LAW Virgil C. Herrick James D. Hoe May 10, 1989 ft Gregg V. Herrick Of Counsel David P. Newman Jock Robertson City of Fridley 6431 University Avenue N.E. Fridley, MN 55432 RE: Advance Companies of Minnesota Dear Jock: I am writing for the purpose of updating you on the above matter. I am in the process of completing a first draft of this agreement and I anticipate being able to forward it to you in the next few days. I apologize for the delays in not getting this to you sooner, but due to the different sequence of events on this project, it has taken a little longer to prepare the necessary documents. This has also been somewhat of a lower priority project due to the fact that all the work has already been completed and the developer is only now seeking this agreement. I should have a draft of this document to you within the next few days for your review. It will then be necessary for the developer to make his comments and to provide us with the necessary exhibits. I would anticipate that we will have a final draft available to the HRA for their review at their June meeting. DPN :jeb incerely yours, avi P. Newman Suitc 205, 6401 University Avenue N.E., Fridley, Minnesota 55432, 612- 571 -3850 i lr +, Draft 4/25/89 (STIN1 -35) CONTRACT FOR PRIVATE DEVELOPMENT By and Between THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY, MINNESOTA EW THIS INSTRUMENT WAS DRAFTED BY: Herrick & Newman P.A. 6401 University Avenue N.E. Suite 205 Fridley, Minnesota 55432 ft TABLE OF CONTENTS (This Table of Contents is not part of the Contract for Private Development and is only for Convenience of reference.) CONTACT FOR PRIVATE DEVELOPMENT ARTICLE I - DEFINITIONS Page 1 Section 1.1. Definitions ....................... 1 -1 ARTICLE II - REPRESENTATIONS AND WARRANTIES AND COVENANTS Section 2.1. Representations and Warranties by the Authority ..................... 2 -1 Section 2.2. Representations and Warranties by the Developer.'*.* ....... 2 -1 ARTICLE III - LAND TRANSACTIONS; UNDERTAKINGS OF THE AUTHORITY Section 3.1. Transfer of the Development Property by the Authority.......... 3 -1- Section 3.2. Conveyance of the Development Property; Costs .................... 3 -1 ARTICLE IV - CONSTRUCTION OF MINIMUM IMPROVEMENTS Section 4.1. Construction of Minimum Section 6.2. Remedies on Default ............... Improvements ...................... 4 -1 Section 4.2. Construction Plans ................ 4 -1 Section 4.3. Commencement and Completion of 6-2 Section 6.5. Construction .....................0 4 -2 Section 4.4. Certificate of Completion ......... 4 -3 ARTICLE V - PROHIBITIONS AGAINST ASSIGNMENT AND TRANSFER; INDEMNIFICATION Section 5.1. Prohibition Against Transfer of Property and Assignment of Agreement .......................... 5 -1 Section 5.2. Release and Indemnification Covenants .......................... 5 -2 ARTICLE VI - EVENTS OF DEFAULT Section 6.1. Events of Default Defined ......... 6 -1 Section 6.2. Remedies on Default ............... 6 -1 Section 6.3. No Remedy Exclusive ............... 6 -2 Section 6.4. No Additional Waiver Implied by One Waiver ......... . . . . . . . . . . . . . . . 6-2 Section 6.5. Agreement to pay Attorneys Fees and Expenses . . ..... . ... . . . . . . . . . . . . 6-3 9 .� draft 4/25/89 CONTRACT FOR PRIVATE DEVELOPMENT THIS AGREEMENT, made on or as of the day of , 1989, by and between the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority "), a political subdivision of the State of* Minnesota organized under the Constitution and laws of the State of Minnesota and , a Minnesota (the "Developer...), WITNESSETH: WHEREAS, the Board of Commissioners (the "Board ") of the Authority has determined that there is a need for development and redevelopment within the corporate limits of the City to provide employment opportunities, to provide adequate housing in the City, including low and moderate income housing and housing for the elderly, to improve the tax base and to improve the general economy of the City and the State of Minnesota; WHEREAS, in furtherance of these objectives, the Authority has established, pursuant to Minnesota Statutes, Sections 469.011 et sue. (the "Redevelopment Act "), the development program known as the Modified Redevelopment Plan for its Redevelopment Project No. 1 (which program, as amended, and as it may be amended, is hereinafter referred to as the "Redevelopment Program ") in the City to encourage and provide maximum opportunity for private development and redevelopment of certain property in the City which is not now in its highest and best use; WHEREAS, as of the date of this Agreement the Redevelopment Program has been prepared and approved by the Board pursuant to the Redevelopment Act, and the Authority's Redevelopment Project No. 1, as amended (hereinafter referred to as the "Redevelopment District "), has been established; WHEREAS, in order to achieve the objectives of the Redevelopment Program and particularly to make the land in the Redevelopment District available for development by private enterprise for and in accordance with the uses specified in the Redevelopment Program, the Authority has determined to provide substantial aid and assistance in connection with the Redevelopment Program through the financing of certain of the public costs of development within the Redevelopment District; and -1- WHEREAS, the Authority believes that the construction of the Minimum Improvements by the Developer pursuant to this Agreement and the fulfillment generally of the terms of this Agreement are in the best interests of the Authority and will promote the health, safety and welfare of the City's residents and are in accord with the public purposes and provisions of the applicable State and local laws and requirements under which the Redevelopment Program has been undertaken and is being assisted: NOW, THEREFORE, -in consideration of the premises and the respective'rights and obligations of the parties hereto, each of them does hereby covenant and agree, respectively, as follows: -2- a 4 ARTICLE I Definitions Section_1.1. Definitions. As used in this Agreement, the following terms have the following respective meanings: " Agreement" means this Contract for Private Development. "Articles ' and -Sections" mentioned by number only are the respective Articles and Sections of this Agreement so numbered. "Authority" means the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota. "Board" means the Board of Commissioners, the governing body of the Authority. "Building Inspector" means the building inspector of the City. "Certificate of Completion" means the certificate (or certificates, if issued separately for the Minimum Improvements ,to be constructed on the development property), in the form attached as Exhibit B hereto, to be provided by the Authority to the Developer pursuant to this Agreement, upon satisfactory completion of the Minimum Improvements. "City" means the City of Fridley, Minnesota. "Company" means the Developer. "Construction Plans" means the plans, specifications, drawings and related documents on all construction work to be performed by the Developer on the Development Property, including all on -site improvements to be performed, installed or constructed upon the Development Property pursuant to this Agreement, which plans have been submitted to the City as Plan Vs dated 1989 as prepared by Such plans shall, at a minimum, include, for each building or other structure to be constructed on the Development Property, at least the following: (i) site plan; (ii) foundation plan; (iii) basement plans; (iv) floor plan for each floor; (v) cross sections of each (length and width); (vi) elevations (all sides); and (vii) landscape plan, and shall include as well adequate plans, drawings and specifications relating to all driveways, walks, parking, and other improvements to be 1 - 1 �- constructed upon the Development Property by the Developer. The site plan submitted by the Developer to the Building Inspector for the City, if approved by the Building Inspector and acceptable to the Authority, may serve as the Construction Plans. "Council" means the City Council, the governing body of the City. .''County" means the County of Anoka, Minnesota. "Developer' means -a Minnesota and any successor thereto permitte y this Agreement. "Development Plan" means the plan attached hereto as Exhibit D, the original of which is on file with the Authority, generally describing the development to be undertaken by the Company hereunder. "Development Property" means the real property described in Exhibit A of this Agreement. "Development Quality Plan" means the pictorial description, attached hereto as Exhibit E, the original of which is on file with the Authority, of the anticipated quality of the Minimum Improvements; the Development Quality Plan does not purport, however, to conform to or amend the Development Plan but is intended to reflect the definitions of "quality" set forth in Section 4.2(c) hereof. "Environmental Audit" means an environmental audit as that term is defined in the industry prepared by a reputable engineering firm with not less than ten years of experience in this field. This audit shall be addressed to the Authority, and shall cover those areas of investigation that will qualify the Authority as an "innocent landowner" under 42 U.S.C. §9607(b)(3), including but not limited to; an on -site physical inspection of the property by qualified personnel, review of all operating permits and reports filed with governmental agencies, and interviews with former landowners. "Event of Default" means an event of default defined in Section 7.1 of this Agreement. "Holder" the owner of a Mortgage. "Minimum Improvements" means the interior and exterior improvements to the Development Property, including landscaping, parking and related facilities, to be constructed by the Developer upon the Development Property pursuant to this Agreement, as such improvements are defined in the Construction Plans therefore and which Minimum Improvements shall consist of a square foot first class office building. 1 - 2 "Redevelopment Program" means the redevelopment program adopted by the Authority for its Redevelopment Project No. 1, as amended. "State" means the State of Minnesota. "Tax Official" means any City or County Assessor; County Auditor; City, County or State Board of Equalization; the Commissioner of Revenue of the State; or any State or federal court,Ithe-Tax,Court of the State or the State Supreme Court. "Unavoidable Delays means delays, outside the control of the Party claiming its occurrence, which are the direct result of strikes, other labor troubles, unusually severe or prolonged bad weather, Acts of God, fire or other casualty to the Minimum Improvements, litigation commenced by third parties which, by injunction or other similar judicial action, directly resu-Its in delays, or acts of any federal, state or local governmental unit (other than the Authority) which directly result in delays. 1 - 3 Y � ti ARTICLE II Representations, Warranties and Covenants Section.2.1 Representations and Warranties by the Authority. The Authority represents and warrants that it is authorized.to enter into and perform its obligations under this Agreement; however: no part of this Agreement shall be construed as a representation of the Authority as to the condition of the Develop ment "Property or as to its suitability for the Developer's purposes and needs. Section 2.2 Representations and Warranties by the Developer. The Developer represents and warrants that: (a) The Developer is a existing under the laws of the Sta- tion of any provisions of its or , is not in violation of law of the State and is authorized perform its obligations under this duly organized and te, is not in viola - any provisions of the to enter into and Agreement. (b) That the Developer will construct, operate and maintain the Minimum Improvements upon the Development Property in accordance with this Agreement and all local, state and federal laws and regulations (including without limitation environmental, zoning, building code and public health laws and regulations). (c) The cost of construction of the Minimum Improvements will be not less than $2,190,000. (d) The Developer has received no notice or communication from any local, state or federal official or body that the activities of the Developer respecting the Development Property or the construction of the Minimum Improvements thereon may be or will be in violation of any law or regulation, except as may have been previously disclosed by the Developer to the Authority. (e) The Developer will use its best efforts to obtain, in a timely manner, all required permits, licenses and approvals, and to meet, in a timely manner, all require- ments of all applicable local, state and federal laws and regulations which must be obtained or met before the Minimum Improvements may be lawfully constructed. (f) The execution and delivery of this Agreement, the consummation of the transactions contemplated hereby and the fulfillment of or compliance with the terms and conditions of this Agreement are not prevented or limited by and will not conflict with or result in a 2 - 1 breach of any provision or requirement applicable to the Developer, or any evidences of indebtedness, agreement or instrument of whatever nature to which the Developer is now a party or by which it is bound. (g) The Developer recognizes it may need to obtain cer7 tain special use or other permits from the City to enable construction*of the'Minimum Improvements and the Develope_r.acknowledges that the issuance or non - issuance of sucfi_ permits rests with the City and not the Authority. 2 - 2 ARTICLE III Land Transactions; Undertakings of the Authority Section 3.1. Transfer of the Development Property by the Authority. (aY-_ Purchase of Development Property. Subject to the Provisions of paragraph b of this Section 3.1; and prJbr..to'the conveyance in Section 3.2 (a), the Developer ahall'cause the Development Property to be conveyed to the Authority. The Developer shall pay all costs and expenses associated with this conveyance. (b) Conditions Precedent. The Authority's obligation to accept conveyance of the Development Property shall be contingent on the satisfaction by the Developer of the following conditions precedent: (i) the Developer shall with all of the terms and Agreement; be in material compliance provisions of this (ii) the Developer shall have submitted Construction Plans,which shall have been approved by the Authority, pursuant to Section 4.2 of this Agreement; (iii) there shall have been obtained from the City all special -use permits and zoning approvals necessary for the construction of the Minimum Improvements; (iv) the Developer shall have submitted to the Authority an Environmental Audit of the Development Property, which shall be acceptable to the Authority in its sole discretion; (v) that the Developer shall in compliance with all ordinances of the City. Section 3.2. Conveyance of the Development Property; Costs. (a) Conveyance. The Authority shall convey for the sum of One Dollar to the Developer by quit claim deed all interest 1 3 - 1 received by the Authority in the Development Property pursuant to the transfer thereof described in section 3.1(a). In connection with the transactions contemplated by this Agreement, the Authority assumes no responsibilities respecting the title to the Development Property and the Authority shall not be liable to the Developer for any defects therein, provided, however, that the Authority,agrees not-- to - cause -whatever interests it may receive in the' Development Property pursuant to the transfer thereof referenced •in- Section 3.1 hereof to become encumbered prior'to the conveyance of the Development Property to the Developer under this subsection. (b) Conveyance Set Aside. At the time of the conveyance referenced in Section 3.2(a) hereof, the Authority shall set aside $109,500 (the "Reserved Funds "),.which funds shall remain funds of the Authority, subject to this Agreement. If the Authority issues the Certificate of Completion for the Development Property the Reserved Funds shall thereupon be paid to the Developer. If the Certificate of Completion is not issued within 12 months of the date hereof, the Reserved Funds (or the portion thereof not theretofore paid to the Company pursuant to this Agreement) shall no longer be subject to any provision of this Agreement, and the Authority may thereupon use the Reserved Funds for any other of its lawful uses. (c) Costs. Unless otherwise mutually agreed by the Authority and the Company, the execution and delivery of all deeds shall be made at the principal office of the Authority. All deeds shall be in recordable form and shall be promptly recorded by the Company. The Company shall pay all costs for recording such deeds, if any. 3 - 2 ARTICLE IV Construction of Minimum Improvements Section 4.1. Construction of Minimum Improvements. The Developer agrees that it will construct the Minimum Improvements on the Development Property in conformance with the approved Construction Plans. The Developer agrees that the scope and scale of the Minimum Improvements to be constructed.shall.not be significantly less than the scope and scale of the Minimum Improvements as detailed and outlined in the Constructions Plans. Section 4.2. Construction Plans. (a) The Authority shall have no obligation to the Developer to take any action pursuant to any provision of this Agreement, until such time as the Developer has submitted Construction Plans to the Authority, and the Authority has approved such Construction Plans. The Authority shall approve the Construction Plans if: (a) the Construction Plans conform to the provisions of this Agreement; (b) the construction plans conform to Exhibit C; (c) the construction plans conform to the Development Plan and the Development Quality Plan; (d) the Construction Plans conform to all applicable federal, State and local laws, ordinances, rules and regulations; (e) the Construction Plans are adequate to provide for the construction of the Minimum Improvements; and (f) no Event of Default has occurred; provided, however, that any such approval of the Construction Plans pursuant to this Section 4.2 shall constitute approval for the purposes of this Agreement only and shall not be deemed to constitute approval or waiver by the Authority or the City with respect to any building, zoning or other ordinances or regulation, and shall not be deemed to be sufficient plans to serve as the basis for the issuance of a building permit if the Construction Plans are not as detailed or complete as the plans otherwise required for the issuance of a building permit. Such Construction Plans must be rejected in writing by the Authority within 30 days of submission or shall be deemed to have been approved by the Authority. If the Authority rejects the Construction Plans in whole or in part, the Developer shall submit new or corrected Construction Plans within 30 days after receipt by the Developer of written notification of the rejection, accompanied by a written statement of the Authority specifying the respects in which the Construction Plans submitted by the Developer fail to conform to the requirements of this Section 4.2 The provisions of this Section 4.2 4 - 1 relating to approval, rejection and resubmission of Construction Plans shall continue to apply until the Construction Plans have been approved by the Authority. Approval of the Construction Plans by the Authority shall not relieve the Developer of any obligation to comply with the provisions of this Agreement or the pro- visions of applicable federal, state and local laws, ordinances and regulations; nor shall approval of the Ponstruction Plans by the Authority be deemed to consti- tute'a waiver•of any Event of Default. (b) If the Developer desires to make any substantial change in the Construction Plans after their approval by the Authority, the Developer shall submit the proposed change to the Authority for its approval or rejection pursuant to this Section. A proposed change in the Construction Plans shall be deemed approved unless rejected by the Authority in writing within 30 days of submission thereof with a statement of the Authority's reasons for such rejection. (c) All Construction Plans submitted by the Company to the Authority shall provide for a "Quality" development. For purposes of this Agreement "Quality" shall be deemed to include items such as selection of materials and their use and /or application in such a way as to create a distinctive, architectural and aesthetically pleasing impact to the building, its occupants or passers -by. "Quality" may involve the use of materials and items such as brick, glass, architecturally designed precast aggregate panels, glass curtain wall, granite, specialized parking treatments and distinctive landscaping. "Quality" shall include the nature and style of development depicted in the Development Quality Plan. Section 4.3. Commencement and Completion of Construction. (a) Subject to Unavoidable Delays, the Developer shall commence construction of the Minimum Improvements on or before (b) Subject to Unavoidable have subtantially completed Improvements on or prior to Delays, the Developer shall the construction of Minimum May 1, 1990. (c) All work with respect to the Minimum Improvements to be constructed or provided by the Developer on the Development Property shall be in conformity with the Construction Plans as submitted by the Developer and approved by the Authority. 4 - 2 (d) Until construction of the Minimum Improvements has been completed, the Developer shall make reports to the Authority, in such detail and at such times as may reaso- nably be requested by the Authority, as to the actual progress of the Developer with respect to the construc- tion. of the Minimum Improvements. The Developer also agrees that it shall allow a designated representatives. of:the Authority to enter upon the Development Property during the construction of the Minimum Improvements to inspect':such construction. Section 4.4 Certificate of Completion. (a) Promptly after completion of the Minimum Improvements to be constructed in accordance with the Construction Plans and the provisions of this Agreement, the Authority will furnish the Developer Company with a Certificate of Completion thereof, in substantially the form set forth in Exhibit B attached hereto. That no Event of Default shall have occurred and be continuing under the terms of this Agreement shall be a condition precedent to the issuance of the Certificate. A Certificate of Completion shall be a conclusive determination of satisfaction and termination of the agreements and covenants in this Agreement with respect to the obligations of the Developer to construct the Minimum Improvements covered by said Certificates. (b) If the Authority determines that it cannot issue the Certificate of Completion, it shall, within 30 days after written request by the Developer, provide the Developer with a written statement indicating in adequate detail in what respects the Developer has failed to complete the Minimum Improvements in accordance with the provisions of this Agreement or is otherwise in default under the terms of this Agreement (including without limitation an Event of Default hereunder), and what measures or acts it will be necessary for the Developer to take or perform in order to obtain such Certificate of Completion. 4 - 3 s ARTICLE V Prohibitions Against Assignment and Transfer; Indemnification Section 5.1 Prohibition Against Transfer of Property and Assignment of Agreement. The Company represents and agrees that prior-to the issuance of the Certificate of Completion'of the Minimum Improvements by the Authority: (a). Except only by way of security for the purpose of obtaining financing necessary to enable the Company or any successor in interest to the Development Property, or any part thereof, to perform its obligations with respect to making the Minimum Improvements under this Agreement, and any other purpose authorized by this Agreement, the Company (except as so authorized) has not made or created and will not make or create or suffer to be made or created any total or partial sale, assignment, conveyance, or any trust or power, or transfer in any other mode or form of or with respect to the Development Property or any part thereof or any interest therein, or any contract or agreement to do any of the same, without the prior written approval of the Authority and compliance with Minnesota Statutes, Section 462.525, Subdivision 5. (b) The Authority shall be entitled to require, except as otherwise provided in the Agreement, as conditions to any such approval that: (i) Any proposed transferee shall have the qualifications and financial responsibility, in the reasonable judgment of the Authority, necessary and adequate to fulfill the obligations undertaken in this Agreement by the Company. (ii) Any proposed transferee, by instrument in writing satisfactory to the Authority, shall, for itself and its successors and assigns, and expressly for the benefit of the Authority, have expressly assumed all of the obligations of the Company under this Agreement and agreed to be subject to all the conditions and restrictions to which the Company is subject unless the Company agrees to continue to fulfill those obligations, in which case the preceding provisions of this Section 5.1)b)(ii) shall not apply; provided, however, that the fact that any transferee of, or any other successor in interest whatsoever to, the Development 5 - 1 Property, or any part thereof, shall not, for whatever resaon, have assumed such obligations or so agreed, shall not (unless and only to the extent .otherwise specifically provided in the Agreement or agreed to in writing by the Authority) deprive the Authority of any rights or remedies or controls with respect to the Development Property or the Construction of the Minimum Improvements; it being the -intent of the Parties as expressed in this Agreement that Cto•the fullest extent permitted by law and equity and excepting only in the manner and to the extent specifically provided otherwise in the Agreement) no transfer of or change with respect to ownership in the Development Property or any part thereof, or any interest therein, however consummated or occurring, and whether voluntary or involuntary, shall operate, legally or practically, to deprive or limit the Authority of or with respect to any rights or remedies or controls provided in or resulting from the Agreement with respect to the Development Property and the construction of the Minimum Improvements that the Authority would have had had there been no such transfer or change. In the absence of specific written agreement by the Authority to the contrary, no such transfer or approval by the Authority thereof shall be deemed to relieve the Company or any other party bound in any way by the Agreement or otherwise with respect to the construction of the Minimum Improvements from any of its obligations with respect thereto. (iii) There shall be submitted to the Authority for review and prior written approval all instruments and other legal documents involved in effecting the transfer of any interest in this Agreement or the Development Property. Section 5.2. Release and Indemnification Covenants. (a) The Company releases from and covenants and agrees that the Authority and the City and the governing body members, officers, agents, including its independent contractors, consultants and legal counsel, servants and employees thereof (hereinafter, for purposes of this Section, collectively the "Indemnified Parties ") shall not be liable for and agrees to indemnify and hold harmless the Indemnified Parties against any loss or damage to property or any injury to or death of any person occurring at or about or resulting from any defect in the Project. 5 - 2 (b) Except for any willful misrepresentation or any willful or wanton misconduct of the Indemnified Parties, the Company agrees to protect and defend the Indemnified Parties, now and forever, and further agrees to hold the aforesaid harmless from any claim, demand, suit, action or other proceeding whatsoever by any person or entity whatsoever arising or purportedly arising from this Agreement, or the transactions contemplated hereby or the acquisition, construction, installation, ownership, and operation of the Minimum Improvements, provided, that this indemnification shall not apply to the warranties made or obligations undertaken by the Authority in this Agreement. 5 - 3 ARTICLE VI Events of Default Section.6.1. Events of Default Defined. The following are Events of. Default under this Agreement: (a). Failure by the' Developer to timely pay all real 3iroperty taxes assessed with respect to the Development Property. (b) Failure by the Developer to commence and complete construction of the Minimum Improvements pursuant to the terms, conditions and limitations of this Agreement. (c) Failure by the Developer to substantially observe or perform any material covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement. (d) An event of default occurs under any agreement or instrument executed by the Developer respecting the Development Property or the Minimum Improvements or any portion thereof. (e) The holder of any security interest in any part of the Development Property or Minimum Improvements takes action to enforce the same for satisfaction. (f) A petition in bankruptcy is filed naming the Developer as debtor, and such petition is not dismissed within 90 days of the date of filing thereof. An Event of Default shall also include any occurrence which would with the passage of time or giving of notice become an Event of Default as defined hereinabove. Section 6.2. Remedies on Default. Whenever any Event of Default occurs and remains uncured, the Authority may take any one or more of the following actions after giving 30 days written notice to the Developer by the Authority, but only if the Event of Default has not been cured within said 30 days: (a) The Authority may suspend its performance under the Agreement until it receives assurances from the Developer, deemed adequate by the Authority, that the Developer will cure its default and continue its performance under the Agreement. (b) The Authority may withhold the Certificate of Completion. 6 - 1 ' (c) The Authority may take whatever action, including • mortgage foreclosure, legal or administrative action, which may appear necessary or desirable to the Authority to collect any payments due under this Agreement or the Second-Mortgage or to enforce performance and observance of any obligation, agreement, or covenant of the Developer under this Agreement. Section 6.3. No Remedy Exclusive. No remedy herein conferred upon or, reserved to the Authority is intended to exclusive'of any other available remedy or remedies, but each and every.such remedy shall be cumulative and shall be in addition to every other remedy given under this Agreement or now or hereafter existing at law or in equity. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right and power may be exercised from time to time and as often as may be deemed expedient. Section 6.4. No Additional Waiver Implied by One Waiver. If any agreement contained in this Agreement should be breached by any Party and thereafter waived by any other Party, Such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other concurrent, previous or subsequent breach hereunder. Section 6.5. Agreement to pay Attorneys Fees and Expenses. Whenever any Event of Default occurs and the Authority shall employ attorneys or incur other expenses for the collection of payments due or to become due or for the enforcement or per- formance or observance of any obligation or agreement on the part of the Developer herein contained, the Developer agrees that he shall, on demand therefore, pay to the Authority the reasonable fees of such attorneys and such other expenses so incurred by the Authority. 6 - 2 ARTICLE VII Additional Provisions Section-7.1. Restrictions on Use. The Developer agrees for itself, .its successors and assigns and every successor in . interest to the Development Property, or any part thereof,. that the Developer and such successors and assigns shall devote the Development Property to, and only to, and in accordance with, the uses specified in'the City's Zoning Code and in this Agreement. Section 7.2. Conflicts of Interest. No member of the governing body or other official of the Authority shall have any financial interest, direct.or indirect, in this Agreement, the Improved Parcel, or any contract, agreement or other transaction contemplated to occur or be undertaken thereunder or with respect thereto, nor shall any such member of the governing body or other official participate in any decision relating to the Agreement which affects his personal interests or the interests of any corporation, partnership or association in which he is, directly or indirectly, interested. No member, official or employee of the Authority shall be personally liable to the Developer, or any successor in interest, in the event of any default or breach by the Authority or for any amount which may become due to the Developer or his successor or on any obligations under the terms of the Agreement. Section 7.3. Provisions Not Merged With Deed. None of the provisions of this Agreement shall be merged by reason of any deed transferring any interest in the Development Property and any such deed shall not be deemed to affect or impair the provi- sions and covenants of this Agreement. Section 7.4. Titles of Articles and Sections. Any titles of the several parts, Articles and Sections of this Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of the provisions hereof. Section 7.5. Notices and Demands. Except as otherwise expressly provided in this Agreement, a notice, demand or other communication under the Agreement by either party to the other shall be sufficiently given or delivered if sent by registered or certified mail, postage prepaid, return receipt requested, or delivered personally; and, (a) in the case of the Developer is mailed to or delivered personally to 7 - 1 (b) in the case of the Authority, is mailed to or delivered personally to the Authority at the Fridley City Hall, 6431 University Avenue N.E., Fridley, Minnesota 55432, Attention: Fridley City Manager. (c) in'the case of the Holder the first mortgage is addressed or delivered personally to an address to be supplied; or at such•othe'r address as may be designated in writing and forwarded to the other parties as provided in this Section. Section 7.6. Counterparts. This Agreement is executed in any number of counterparts, each of which shall constitute one and the same instrument. Section 7.7. Law Governing. This Agreement will be governed and construed in accordance with the laws of Minnesota. 7 - 2 ARTICLE VIII Termination of Agreement Section 8.1. The Developer's Options to Terminate. This Agreement may be terminated by the Developer if Ti) the Developer'is in compliance with all material terms of this Agreement•and no Event of Default has occurred and (ii) the Authority fails to comply with any material term of this Agreement,-and,- after written notice by the Developer of such failure-, -'the Authority has failed to cure such non - compliance within 90 days -of receipt of such notice, or, if such non- compliance cannot reasonably be cured by the Authority within 90 days, the Authority has not, within 90 days of receipt of such notice, provided assurances,-reasonably satisfactory to the Developer, that such non - compliance will be cured as soon as reasonably possible. Section 8.2. The Authority's Options to Terminate. The Authority may terminate this Agreement and/or may refuse to issue the Certificate of Completion (and be subject to no obliga- tion or liability therefore) as provided in Section 4.4 hereof. Section 8.3. Extraordinary Termination. If the Developer is unable to obtain all governmental permits necessary to enable the construction of the Minimum Improvements or if prior to , 1989 any of the other conditions stated in Section 4.3 have not been satisfied, then this Development Agreement and the Assessment Agreement, if any, shall thereupon automatically terminate. Section 8.4. Action to Terminate. Termination of this Agreement due to the occurrence of any of the foregoing except Section 8.3 must be accomplished by written notification to the Authority or to the Developer, as the case may be, provided by the terminating Party within 10 days after the date when such option to terminate may first be exercised. 8 - 1 IN WITNESS WHEREOF, the Authority and the Developer have caused this Agreement to be duly executed on this day of , 198. HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY, MINNESOTA By Its Chairman And Its Director By Its ti 8 - 2 STATE OF MINNESOTA ) )ss. COUNTY OF ) The foregoing instrument was acknowledged before me this day of 198 , by John L. Robertson Executive"Director of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota, a political subdivision of the State of Minnesota, on.behalf of said Authority. Notary Public 8 - 3 STATE OF MINNESOTA ) )ss. COUNTY OF ) The foregoing instrument was acknowledged before me this day of- 1 , 198 , by Lawrence R. Commers, Chairman of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota, a political subdivision of the State of Minnesota, on behalf of said Authority. Notary Public 0 8 - 3a C STATE OF MINNESOTA ss. COUNTY OF The foregoing was acknowledged before me this day of 198_, by .. • the • of a Corporation under the laws of Minnesota, on behalf of the Corporation. Notary Public 8 - 4