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HRA 08/08/1991 - 6364HOUSING AND REDEVELOPMENT AUTHORITY MEETING, THURSDAY, AUGUST 8, 1991 7:30 P.M. PAUL HATySEN ACCOUNTANT CITY OF FRIDLEY A G E N D A HOUSING & REDEVELOPMENT AUTHORITY MEETING THURSDAY, AUGUST 8, 1991, 7:30 P.M. Location: City Council Chambers Fridley Municipal Center 6431 University Avenue N.E. CALL TO ORDER: ROLL CALL: APPROVAL OF MINUTES: June 27, 1991 _ -- ACTION ITEMS: CONSIDERATION OF RESOLUTION APPROVING REDEVELOPMENT AGREEMENT WITH THE CHARLES SMITH ESTATE — : —. . . . . . . . 1 - 1B CONSIDERATION OF CONCEPTS OF SETTLEMENT AGREEMENT AND LEASE WITH DON FITCH REGARDING DAIRY QUEEN SITE . . . . . . . . . . . . . .�. 2 - 2N--77= CONSIDER PROPOSAL BY UNIVERSITY AVENUE ASSOCIATES REGARDING RESTRUCTURING SECOND MORTGAGE FOR SPRINGBROOK APARTMENTS . . . . . . . . . . 3 - 3G CONSIDER APPROVAL OF MORTGAGE SATISFACTION « °r'r AGREEMENT, JOHN AND KAREN EARLEY. . . . . . . . . . . . 4 - CONSIDERATION OF HOUSING STUDY OUTLINE. �`.� �� __. ✓ /. '5 CLAIMS AND EXPENSES . . . . . . . 6 - 6F iVR i'TrG+ 7T[ R { N - Check Register (8/2/91 & 7/19/91) - billing for Operating Expenses for June & July 1991 & June & July 1991 Administrative Expenses INFORMATION ITEMS: CONSIDERATION OF INFORMATON ON TIF TURNBACK TO SCHOOLS . . . . . . . . . . . . . . . . . . 7 - 7N CONSIDERATION OF CITY COUNCIL RESOLUTION REGARDING DECERTIFYING TIF DISTRICTS . . . . . . . . . . . . . . . 8 - 8C UPDATE ON INFORMATIONAL MEETING FOR MISSISSIPPI STREET PROJECT . . . . . . . . . . . . . 9 - 9C UPDATE ON RICE PLAZA . . . . . . . . . . . . . . . . . .10 OTHER BUSINESS CITY OF FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 27, 1991 CALL TO ORDER: Chairperson Larry Commers called the June 27, 1991, Housing & Redevelopment Authority meeting to order at 7:30 p.m. ROLL CALL: Members Present: Larry Commers, Duane Prairie, John Meyer Members Absent: Virginia Schnabel, Jim McFarland Others Present: William Burns, Executive Director of HRA Barbara Dacy, Community Development Director Jim Casserly, Consultant Rick Pribyl, Finance Director Jim Hoeft, HRA Attorney Mike Hurley, 12230 Maryland Circle Charles Grootwassink, 3601 Minnesota Dr., Minneapolis Rodger Nystrom, 3200 Main St., Coon Rapids Tony Krejci, 6401 University Ave. N.E. Jack Lemley, Rapid Oil Don & Judy Fitch, 280 Mississippi St. - Dairy Queen APPROVAL OF MAY 9, 1991, HOUSING & REDEVELOPMENT AUTHORITY MINUTES: MOTION by Mr. Meyer, seconded by Mr. Prairie, to approve the May 9, 1991, Housing & Redevelopment Authority minutes as written. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. APPROVAL OF AGENDA: Chairperson Commers stated that agenda item 1 would be continued until later in the agenda, and that agenda items 2, 3, and 4 would be discussed first. 1. CONSIDER APPLICATION FOR TAX INCREMENT FINANCING ASSISTANCE FOR CUB FOODS SITE: Ms. Dacy stated the developer is proposing to rehabilitate the existing 34,000 sq. ft. Cub Foods building into three retail spaces that will have 26,000 sq. ft. of retail, 8,000 sq. ft. of storage space. The petitioner has a signed lease with Pet Food Warehouse HOUSING & REDEVELOPMENT AUTHORITY MTG., JUNE 27, 1991 PAGE 2 which will be the major tenant. It is staff's understanding that proposed is a 5 year lease with an option for a 5 year renewal. The petitioner has a strong interest from Stone Fabric, leaving one remaining tenant space. Ms. Dacy stated the petitioner has indicated a total project cost of $477,958. What is being proposed is that the owners will provide $200,000 of their own money plus another $200,000 will be secured with Northeast State Bank as part of the first mortgage. As part of that arrangement, the bank is also requesting that a certificate of deposit in the form of $50,000 also be retained. Ms. Dacy stated that at the May HRA meeting, the developer was proposing a combination grant and second mortgage or loan. However, in the last 2 -3 days, staff has put together another option for the HRA to consider, and that is the pay -as- you -go option. So, the HRA has two options to discuss: (1) a $15,000 grant and $50,000 second mortgage as proposed terms of 10 years at 90; or (2) staff has worked with the developer to investigate with Northeast State Bank, that the bank would loan them an additional $65,000, but the HRA's development contract could say that the HRA will reimburse the developer after the HRA has seen increments up to cap of $65,000; or, if that cap is not reached within the first set of tax payable years, they will just receive that amount of increment back for 7 years. Ms. Dacy stated that as far as the 'tax increment district is concerned, it would be a redevelopment district with a life of 25 years. Based on just the Cub Foods site alone, it could generate about $224,000 in 25 years. That means annual tax increment receipts of about $9,000, assuming a minimum of $200,000 increase in value. Ms. Dacy stated that as far as the HRA's investment, the HRA could recover the loan and grant of $65,000 in 7 years; or, with the pay - as -you go option, the HRA would recover its investment in 7 years. Ms. Dacy stated staff is asking the HRA to consider this financing assistance proposal. If the HRA agrees with the proposal, they should direct staff to enter into development contract negotiations with the developer, and the development contract would then come back for approval by the HRA. Ms. Dacy stated that for the past month, Mr. Burns and she have worked with the developer, and they have looked at cash flow statements of Pet Food Warehouse. They have looked at the financing terms the developer has with Northeast State Bank. They have investigated a lot of alternatives. To help the HRA review this particular proposal, staff was asked to put together a list of pros and cons: HOUSING & REDEVELOPMENT AUTHORITY MTG. , JUNE 27 1991 PAGE 3 Pros 1. Redevelopment of the Cub Foods site will increase the property values. 2. It will improve the structural quality of the building to meet building codes and the general appearance of the structure. 3. It will provide for additional employment opportunities. 4. It makes good use of the existing building. 5. The land use and proposed plan meet Code requirements. No variances are being requested. 6. The HRA has at least two options to look at in terms of assisting the project. Cons 1. Tenant cash flow of $1,200 2. Lost L.G.A. estimated at $1,200, translates into a present value of $640. 3. Discretionary funds will have to be used if loan and grant option is chosen. 4. Sophistication Mr. Burns stated that although the present value of the HRA's contribution for the alternative option (pay -as- you -go) is higher, he thought the risk is less. Under that option, they are less concerned with the credit rating of the tenants or the development proposal itself. He is in favor of the second option. Apparently, both the project owners and the batik, at this time, seem willing to go with either option. Northeast State Bank's loan committee will be meeting the following week, and there will be no final word on the second option until the committee meets. Mr. Mike Hurley stated that they are amenable to either option. The only concern he has in regard to the second option is that if, in fact, Northeast State Bank does not agree to advance the additional $65,000, then the second option is gone and they would not have the additional funds to make the project go. He feels confident that will happen, but the decision is up to a loan committee of 5 -6 different bankers. It is not so much a security issue, but more the fact that the bank would be lending money against real estate. He stated he wanted the HRA to not dismiss the grant /second mortgage option because they might have to go with HOUSING & REDEVELOPMENT AUTHORITY MTG., JUNE 27, 1991 PAGE 4 that option if Northeast State Bank does not adopt the pay- as -you- go option. Mr. Meyer asked about the developer's timeframe. Mr. Hurley stated that they have committed August 1 for Pet Food Warehouse, but may be able to extend that to August 15. The second tenant, Stone Fabrics, has told them emphatically that if they cannot occupy the building by August 15, they will not lease the space. Mr. Burns stated staff will have to draft a development agreement that must come back for HRA approval. He stated he thought it is possible to keep the options open at this time. Mr. Commers stated that if they go with the grant /second mortgage option, they have to tighten it up and make some additional changes. Because of the problems they have been having with second mortgages, the HRA should get the same thing the bank does in terms of personal guarantees. MOTION by Mr. Meyer, seconded by Mr. Prairie, to approve the concept in principle with respect to tax increment financing assistance to the developer of the Cub Food property. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. Mr. Casserly stated that the issue of security with regard to the second mortgage as mentioned by Mr. Commers has been discussed, and they would want no more or no less than what the lending institutions ask for in terms of personal guarantees. 2. REVIEW APPROVAL AND ADOPTION OF EXPANSION OF REDEVELOPMENT PROJECT AREA AND CREATION OF TIF DISTRICT #11: Mr. Commers asked staff to explain the budget for Tax Increment Financing District No. 11 (University Avenue /Osborne Site) as reflected on pages 3.14 and 3.15 of the agenda. Ms. Casserly stated that at the May HRA meeting, they talked about the idea of putting together a little larger site than just the Cub Foods site. They are proposing taking three parcels north of Osborne Road, which contain the Bob's Produce property. The reason for that is because Cub Foods and the three parcels allow them to create a redevelopment project. So, this is strictly a conceptual budget. All they are trying to do is identify the kinds of things they can spend money on and the absolute outside amounts. It is not a commitment that any of this money will be spent. Mr. Commers stated he is very concerned about these costs. He is concerned about putting down numbers that could be misunderstood n HOUSING & REDEVELOPMENT AUTHORITY MTG., JUNE 27, 1991 PAGE 5 in a few years. He wanted to know what these numbers are based on, why they are being put down, where these numbers come from; and if, in fact, they are just conceptual numbers, they should be identified as such. Mr. Casserly stated most of the numbers come from two separate analyses that were done on the Bob's Produce site. They have taken the gross numbers, acquisition costs, demolition cost estimates, etc. This is truly just a plan; there is not any proposed project. By incorporating this budget now, they are saving some thousands of dollars if the HRA ever wishes to proceed to do anything. Mr. Casserly stated that if they created two districts, they would only be able to take 25% from each district. By making the districts one, what is happening is that they have excess increment south of Osborne Road. If they wish to use that excess increment for activities north of Osborne Road, they would have that option available; and they could use 100% of the increment, not just 25% of the increment. That is what is being achieved by combining the two sites into one district. They can move within the district 100% of the increment. As it relates to all the rest of the districts, whether 1, 2, or 3, they could only move 25% of the increment. That will only be true of this district at this time because the law was changed effective May 1, 1990. Mr. Prairie questioned why the University Station restaurant and the two parcels north of the restaurant, 7700 and 7710 University Avenue, were not included in the tax increment district. Ms. Dacy stated the restaurant would be eligible because the building could be termed substandard. She stated staff was trying to be as conservative as possible and minimize the amount of land within the tax increment district. No contact was made with the owner of the restaurant. The restaurant could always be added to the project area at a later date. The other two properties are ABRA Auto Body and Kennedy Transmission. They are fairly new buildings, and she did not think they should be part of the district. Mr. Commers stated the biggest problem is the restaurant because of the condition of the building. Mr. Casserly stated the restaurant could certainly be included. It is too late now because the notices for the public hearing have already been published for the public hearing at the Council on Monday, July 1, 1991. But, the tax increment district itself could be expanded to incorporate that property, because it would meet the redevelopment criteria. That could be done at a subsequent meeting. Mr. Commers stated he did not have a copy of Exhibit XII -E which reflects the impact this tax increment district would have on the HOUSING & REDEVELOPMENT AUTHORITY MTG., JUNE 27, 1991 PAGE 6 11� school districts. He stated that in Exhibit XII -D, "But For" Analysis, the third paragraph states: "Other buildings in the Tax Increment Financing District will be replaced with larger structures providing additional employment and market valuation." Mr. Commers stated it just seems that something more is taking place that they do not know about. Mr. Casserly stated that if there is a real concern with combining the districts, the HRA can reduce the size of the district and he would draft resolutions to that effect. However, all staff has tried to do is be helpful. The Cub Food property really qualifies as a redevelopment site by itself, and the other properties do not qualify as a redevelopment site. The other properties only qualify as a renewal and renovation district. By taking all four parcels, they can get the longer district and it gives the HRA more options. Ms. Dacy stated that the HRA always has the option to decertify if Bob's Produce does not come in with a proposal. MOTION by Mr. Meyer, seconded by Mr. Prairie, to approve Resolution No. 4, 1991, "A Resolution Modifying the Redevelopment Plan for Redevelopment Project No. 1 and Modifying the Tax Increment Financing Plans for Tax Increment Financing Districts No. 1 through No. 10 to Reflect Increased Project Costs and Increased Geographic Area within Redevelopment Project No. 1; and Establishing Proposed Tax Increment Financing District No. 11 and Approving and Adopting the Proposed Tax Increment Financing Plan Relating Thereto. UPON A VOICE VOTEr ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. Ms. Dacy stated she would get the information regarding the school districts to Mr. Commers. 3. DISCUSS STATUS OF RAPID OIL SITE: Mr. Burns stated that Ashland Oil is requesting a rezoning and special use permit at the City Council on Monday, July 1, 1991. The question before the HRA is: Does the HRA want to recommend that the City Council proceed with these land use applications, or does the HRA want to begin the condemnation process on this property to establish a redevelopment district? Mr. Burns reviewed the facts that he had presented at the last meeting regarding soil contamination and remediation, the value of the Rapid Oil facility, economics of "the Winfield project, the pros and cons of the landbanking issue, and the environmental issue. Mr. Burns stated that if the HRA allows Ashland Oil to construct a new Rapid Oil facility and add another $200,000- 300,000, if the 11� HOUSING & REDEVELOPMENT AUTHORITY MTG., JUNE 27, 1991 PAGE 7 HRA should choose to acquire the property in the future, the project becomes even more expensive. Mr. Burns stated that the City is now looking north of the Rapid Oil property where there is blighted commercial property that has been looked at in preliminary terms for potential residential redevelopment. When they convert from commercial to residential, the tax increment situation is even more difficult. Realizing that, if they do not condemn and allow Ashland Oil to construct a new facility, they are making that situation worse. When Mr. Casserly ran some preliminary numbers 6 -8 months ago, they were looking at a Gateway project that was going to have a net cost of between $2- 3,000,000. Mr. Burns stated the City does not have any project for this property anymore. There is not a Winfield project, and there is no housing redevelopment project on line right now. So, it is not easy to tell the HRA to condemn the property and put the property aside for some project in the future. Nevertheless, as he has considered the facts and the pros and cons, particularly at the additional cost of buying a brand new Ashland oil facility, he has to recommend condemnation. Also, his recommendation hinges on the sense of urgency the Council has attached to the proposed Gateway redevelopment project and the sense of disapproval to the development of automotive uses along University Avenue. Mr. Burns stated the State Legislature has passed some legislation that helps to indemnify the HRA and any future investors in this property against losses they might face as a result of the soil remediation. He asked Mr. Casserly to comment on what has happened at the State Legislature. Mr. Casserly stated the State Legislature passed two laws last session to help HRA's in dealing with contaminated property. One law stated that the HRA can do an environmental assessment prior to the time it initiates condemnation. That same law says that if requested by any party, the Commissioners shall make a finding of the estimated costs of removal and 'remedial actions that will be necessary on the property being taken because of the existing contamination. What that means is that they have to make an assessment, if requested to do so by the HRA, and that amount is taken into consideration in determination of an award. Mr. Commers asked if, under this law, the HRA would be responsible for the cleanup. Mr. Casserly stated that if the HRA acquires the property, then they become the ones responsible for the cleanup. That does not eliminate the previous party's responsibility. The Attorney General has been very specific to point out on a number of ' occasions that this law is supposedly not a new law, but an honest restatement of an existing law to make things more clear. HOUSING & REDEVELOPMENT AUTHORITY MTG., JUNE 27, 1991 PAGE 8 Mr. Meyer asked if a new Rapid Oil facility would jeopardize any redevelopment plans north of this site along University Avenue? Ms. Dacy stated that the Rapid Oil site is about 20,000 sq. ft. That would leave about 1 1/2 acres left. To redevelop that 2 acre site might be difficult as far as what type of development because of the creation of an L- shaped parcel. Mr. Jack Lemley, Ashland Oil, stated he has not heard any mention by staff of the LRT (Light Rail Transit). They are considering a passenger station at either the Rapid Oil location or the SuperAmerica location across the street. He would also like to point out that staff has recommended the zoning change and the special use permit. He stated Ashland Oil has been more than fair in waiting for their rezoning and special use permit requests for two years. The site is an eyesore right now, but they want to clean it up. Mr. Lemley stated he has been asked the question: If the Rapid Oil location was cut out from the rest of the area and the street next to them was closed, would they still be able to operate? He stated, yes, they can, as long as they have enough radius to get around the building. Mr. Commers stated that this is a very difficult issue. He agreed with Mr. Burns that the environmental issue and the landbanking issue should be kept separate. Mr. Meyer stated he is losing some confidence that this parcel is useful for anything other than a Rapid'Oil site. There have been other developers who wanted the site, but now they are no longer around. There are vacant businesses all up and down University Avenue. Should the HRA make the decision to acquire the Rapid Oil site as part of a total goal that seems to be even farther and farther away than before? Ms. Dacy stated that as far as park and ride sites for the LRT, the Anoka County Regional Rail Authority would prefer to have a station at 53rd Avenue and south of 57th Avenue where the SuperAmerica Station and Motor Valet are located. That is an issue the City is going to have to address in the next six months. Mr. Meyer stated it is his opinion that they should not hold up any kind of plans on University Avenue because of the advent of the LRT. LRT is many years in the future. Mr. Commers agreed with Mr. Meyer. Mr. Prairie stated his concern is what affect, whether they acquire the Rapid Oil property or not, this is going to have on their n n HOUSING & REDEVELOPMENT AUTHORITY MTG., JUNE 27, 1991 PAGE 9 developing the University Avenue corridor north of the Rapid Oil site. Mr. Commers stated one suggestion would be to create a TIF there and capture the increment that could then be used in the development of the other properties. Then, Rapid Oil is on the corner. Mr. Commers stated the bigger issue here is the issue of what the HRA does in terms of taking the Rapid Oil property without any projects on line, landbanking, etc., even though it is the HRA's goal to do some redevelopment in this area. The HRA has discussed the University Gateway in terms of priority, but there are just so many other things the HRA is involved in at this time. It would be an easier decision if there was a developer for a project. He stated he has mixed feelings either way. At the last meeting, both Mr. Prairie and Ms. Schnabel had reservations about acquiring the Rapid Oil property. S Mr. Prairie stated he believed the likelihood of any developers coming forward with a project at this time are much slimmer than in the last couple of years. Mr. Meyer stated the decision would be much easier if the Rapid Oil property was the only eyesore along University Avenue, but there are many deteriorating properties along University Avenue. He is also concerned about the landbanking issue and any potential landbanking that the HRA might have to be doing before they are through. MOTION by Mr. Prairie, seconded by Mr. Meyer, that the Rapid Oil property not be acquired through condemnation. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. Mr. Commers thanked Mr. Burns for the time he and staff have put into this item. It is not easy for the HRA to not follow staff's recommendation. Mr. Casserly suggested the following: (1) Most of the work that has been done by staff is looking at what kind of districts qualify. It might be worth reviewing that again, because the HRA may still wish to create a district because of the eligibility of the kind of district that that allows before a permit is issued. (2 ) This does not prohibit the HRA in the future from acquiring the Rapid Oil site if there is a master project. The site would just be more expensive. Mr. Commers stated he agreed with Mr. Casserly's first suggestion. He stated he still has a lot of questions about the contamination and cleanup of the site, who is going to pay for it, and when. HOUSING & REDEVELOPMENT AUTHORITY MTG., JUNE 27, 1991 PAGE 10 Mr. Lemley stated that if the site is not under condemnation and they get the permits they are requesting from the City, they are going to clean up the property. They do not have a final design on the final cleanup, because they have been waiting to see if they were going to get the necessary permits from the City. Their next step is the City Council on Monday, July 1, 1991, for the rezoning change and the special use permit. When they get those permits, they will put together the final design for the cleanup. They hope to start building as soon as they can. Ms. Dacy stated the MPCA has approved a preliminary remediation plan for the groundwater pumping and soil cleanup. 4. CONSIDER REQUEST BY DR. MICHAEL PARK TO FORGIVE A PORTION OF THE SECOND MORTGAGE ON THE FRIDLEY PLAZA OFFICE BUILDING: Mr. Burns stated that the City has received two letters from Dr. Park's real estate representative, Tony Krejci, dated May 7, 1991, and May 14, 1991. In the May 7th letter, Mr. Krejci asked the HRA to forgive about three - fourths of the second mortgage which is almost $40,000, and of that, he offered to settle with the HRA for $10,000. In the May 14th letter, Mr. Krejci asked the HRA to revise the real estate taxes on the building. Mr. Burns stated he has received two recommendations from Virgil Herrick and his legal staff: 1. The HRA decline to revise the taxes. The taxes are guaranteed as part of the development agreement on this property. The tax guarantee is carried on to successors and assigns and the HRA's position should be defensible in court. 2. On the second mortgage issue, Dr. Park has not yet foreclosed. He is the mortgage holder, but not yet the owner. There is time for the HRA to consider this and the HRA is advised to not take any immediate action. Mr. Hoeft stated Dr. Park is the new mortgagee of the property and apparently has purchased the mortgage and the mortgage note, but has not received in a traditional sense the deed for transfer of the property. If Dr. Park is to choose to foreclose on the mortgage and pursue that avenue, obviously there is still a time - frame under which the HRA can operate and make some decisions. As far as the request for the $10,000 to pay off a $40,000 mortgage, the HRA can either accept that, not do anything, or perhaps enter into further negotiations with Dr. Park. Mr. Commers asked if the HRA has any kind of promissory note from anyone that goes with that mortgage. 111 HOUSING & REDEVELOPMENT AUTHORITY MTG., JUNE 27, 1991 PAGE it Mr. Hoeft stated he cannot give the HRA an answer on that question right now. Mr. Tony Krejci stated he was involved with the transactions for the sale and he has worked with the former owner, Jack Brandt. They have had a lot of deficits and a lot of outstanding bills with the former owner. When Dr. Park purchased the building, he paid over $200,000 in back taxes plus an additional $39,000 that was due on May 15, 1991. He is also putting $125,000 into the building in terms of tenant improvements and upgrading the building. Right now, they have a 90% leased -up rate, plus the fact that Dr. Park has spent "x" amount of dollars in upgrading the other building in addition to the tenant improvements. Mr. Krejci stated they did have one outstanding lien with a former creditor with Jack Brandt which was $8,500. He negotiated a settlement for $2,500, and there was also a negotiation of $10,000 with the Fridley HRA for the parking lot. Mr. Krejci stated he has been asked to see if there is some kind of arrangement that can be worked out with the City on the second mortgage. This is the final hurdle to try to work around the $40,000 deficit. He was given a figure of $10,000 to try to get the issue resolved. Dr. Park is trying to sustain a good rapport with the City by negotiating these problems. Mr. Commers stated he would like staff to get a complete history on the building and the HRA can discuss this again at the next meeting. Mr. Hoeft stated he thought they can all agree that some positive action is nice to see; but, by the same token, he would remind the HRA that this building was not "purchased" in a vacuum. The purchaser knew the situation when he purchased the building. Mr. Burns stated another thing for the HRA to keep in mind is the precedent that a revision of taxes would set for the future. Mr. Commers stated he did not think that legally they can consider revising or reducing the taxes. Mr. Hoeft stated if that if anyone is going to reduce those taxes, he would recommend that a court do that on a voluntary basis. Mr. Krejci stated the issue of the taxes was brought to Dr. Park's attention when he looked at another comparable building, the Commerce Building, for sale in the City. The taxes on the Fridley Plaza Office building are $79,566.16 per year at 30,700 sq. ft. (with parking lot lease as additional cost, only footprint ownership), and the taxes on the Commerce Building square footage is $39,806.96 per year at 26,000 sq. ft. and they own the land. Dr. Park is asking why his taxes are so high compared to another HOUSING & REDEVELOPMENT AUTHORITY MTG., JUNE 27, 1991 PAGE 12 —� comparable property. He stated he has discussed this with the City Assessor, and the Assessor has no idea why the taxes are so high. Mr. Commers thanked Mr. Krejci for coming and stated that this item will be discussed further at the next meeting. 5. REQUEST BY DON FITCH. FRIDLEY DAIRY QUEEN: Mr. Fitch thanked the HRA and staff for allowing him to speak to the HRA before the final date of the condemnation takeover. Mr. Fitch stated the offer as part of condemnation is $125,000, of which he is not totally in agreement. While he has not gotten a formal appraisal, he did order one. �He made a counter -offer to City staff of $175,000, plus moving expenses. He reached that figure as follows: 1. Comparable site locations for his purchase within the City limits within his acceptable franchise area; 2. Knowing the fair market value of his business. Mr. Fitch stated his family has owned the Fridley Dairy Queen for over 25 years. They want to continue to operate a Dairy Queen in Fridley, and he believed the Fridley community wants them to stay in Fridley. He would like to move to the Fridley Town Square project. He would prefer to own his own property, but that seems to be cost - prohibitive at this time. Mr. Fitch stated he does not want to end up in court with the City if he can avoid it. He would like to move to the Fridley Town Square development. Staff would like that, and the developer would like that. One of the stipulations he is trying to work out with the City and the developer is for him to maintain his Dairy Queen logo signage on a pylon sign. Whether it be part of the Walgreen's pylon, part of the Fridley Town Square pylon, or a separate pylon, he would like to maintain the Dairy Queen logo to help identify his business in that development. He would like the HRA to favorably consider making a recommendation to the Council that if he is to move into Fridley Town Square, a potential variance be granted to allow Walgreen and himself to maintain their identify in the center. He has a pylon sign now that meets the City Sign Code requirements, and he is asking for the same type of signage at the new center. Mr. Fitch that as of July 25, 1991, he would like to lease the building back from the HRA for the remainder of the season and any part of next season that he would need until such time as he can move into a new location. His attorney is drafting a lease. He will also have a new appraisal by that time. Ms. Dacy stated that will be an item on the July HRA meeting. • ' t HOUSING & REDEVELOPMENT AUTHORITY MTG., JUNE 27, 1991 PAGE 13 6. CONSIDERATION OF RICE PLAZA ITEMS: This item was continued until the next meeting. 7. APPROVE REMOVAL OF TREE STUMPS AT LAKE POINTE: MOTION by Mr. Prairie, seconded by Mr. Meyer, to approve a contract with Greenmasters, Inc., the Lake Pointe maintenance contractor for $2,325 ($46.50 per stump) for the removal of tree stumps at Lake Pointe. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. Mr. Commers asked staff to make sure that Greenmasters has adequate insurance. 8. CLAIMS• a. Check Register (2129 -2136) MOTION by Mr. Prairie, seconded by Mr. Meyer, to approve the check register June 12, 1991, with. the addition of check #2136 for Peter Patchin in the amount of $5,700 for an appraisal done in conjunction with the Lake Pointe property. UPON A VOICE VOTE, ALL VOTING AYE, CHAIRPERSON COMMERS DECLARED THE MOTION CARRIED UNANIMOUSLY. 9. INFORMATION ITEMS: The following were information items only: a. Memo from John Flora regarding University Avenue Improvements b. Policy Discussion regarding School District TIF Turnbacks C. Update on Fridley Town Square d. Update on Mississippi Street Improvement Project ADJOURNMENT: Chairperson Commers declared the June 27, 1991, Housing & Redevelopment Authority meeting adjourned at 9:30 p.m. Res ectfully sVbmitted, Ly a Saba Recording Secretary 1 r _ Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: August 1, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Consideration of Resolution Approving Development Agreement with the Charles Smith Estate Background At the June 27, 1991, HRA meeting, the HRA conceptually approved preliminary terms of assisting the redevelopment of the former Cub Foods site at 250 Osborne Road. The HRA approved the expenditure of $65,000 of tax increment on a "pay -as- you -go" basis with the stipulation that the assistance would not exceed $65,000 or the amount of tax increment over seven tax payable years. In order to achieve this arrangement, the petitioner had to increase the first mortgage amount from Northeast State Bank from $200,000 to $265,000. The petitioner did receive the additional money for financing the first mortgage. Analysis Jim Casserly has prepared the attached resolution and development contract for authorization by the HRA. The development contract is consistent with the direction given by the HRA at the last meeting. Please note that on page 12 we have included a restriction on use of the building for any use or.occupancy that would be considered a "sexually oriented business" as defined in Ordinance #965, as well as a prohibition against parking truck trailers on the property for an extended period of time. Mike Hurley, attorney for the Estate, has received a copy of the development contract and will be present at the meeting. Jim Casserly will also be present to review the elements of the development contract if needed. Recommendation Staff recommends the HRA approve the attached resolution authorizing execution and delivery of the development contract. BD:ls M -91 -559 1 -A HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY OF FRIDLEY COUNTY OF ANOKA STATE OF MINNESOTA RESOLUTION NO. A RESOLUTION AUTHORIZING EXECUTION AND DELIVERY OF A CONTRACT FOR PRIVATE REDEVELOPMENT BY AND BETWEEN THE HOUSING AND REDEVELOPMENT AUTHORITY IN AND FOR THE CITY FRIDLEY AND STEVEN HARDY, LEANNE HARDY, KENT SMITH, SPRING SMITH, KENT GARDNER AND JERRILL LYNN GARDNER. BE IT RESOLVED by the Board of Commissioners (the "Commissioners ") of the Housing and Redevelopment Authority in and for the City of Fridley, Minnesota (the "Authority ") as follows: Section 1. Recitals. 1.01. It has been proposed that the Authority enter into a Contract For Private Redevelopment (the "Contract ") with Steven Hardy, LeAnne Hardy, Kent Smith, Spring Smith, Kent Gardner and Jerrill Lynn Gardner (collectively known as the "Redeveloper "). Section 2. Findings. 2.01. The Authority hereby finds that it has approved and adopted a development program known as the Modified Redevelopment Plan for its Redevelopment Project No. 1 (the "Redevelopment Program ")pursuant to Minnesota Statutes, Section 469.001 et seq. 2.02. The Authority hereby finds that the Contract promotes the objectives as outlined in its Redevelopment Program. Section 3. Authorization for Execution and Delivery. 3.01. The Chairman and the Executive Director of the Authority are hereby authorized to execute and deliver the Contract when the following condition is met: Substantial conformance of a Contract to the Contract presented to the Authority as of this date. 1 Adopted by the Board of Commissioners of the Authority this day of , 19_ ATTEST: Executive Director ll�, 2 Chairman 1 -B r _ CA Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: August 1, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Consideration of Concepts of Settlement Agreement and Lease with Don Fitch Regarding the Dairy Queen Site Background The HRA authorized staff to begin the acquisition process of the Dairy Queen property last year in order to obtain the necessary road frontage along Mississippi Street to convey it to Anoka County. On April 4, 1991, the HRA passed a resolution authorizing the quick -take condemnation process. As of July 25, 1991, the HRA owns the Dairy Queen property subject to final determination of the value via hearings by court- appointed commissioners. In the interim period, staff has been negotiating directly with Don Fitch and his wife regarding the acquisition terms and the lease terms. Proposed Settlement Agreement and Lease Agreement Attached to the memo is a list of the preliminary settlement terms for the property. The total cost to the HRA is $167,500; $157,500 for the property and $10,000 in relocation expenses. Fitch, however, is still proposing that he pay $500 /month in rent only if the HRA pays $500 for his attorney fees to review the lease agreement, to review the closing documents, and to conclude the sale. Fitch will be responsible for all other operating costs for the building including taxes, utilities, and insurance. Fridley Town Square Redevelopment Fitch has signed a lease with Scott Ericson to relocate in the Fridley Town Square shopping center. At the writing of this report on Thursday, August 1, 1991, Scott Ericson was to receive final word from Marquette Bank on whether or not the financing on the construction loan would be approved. If Ericson does not receive the financing to proceed with the Fridley project, Town Square Consideration of Concepts of Settlement Agreement and Lease with Don Fitch Regarding the Dairy Queen Site August 1, 1991 Page 2 Fitch has indicated that this would affect his negotiation on the settlement and the lease. He stated he would want some type of provision in the lease for compensation of his business when we redevelop the southwest quadrant. Lease Agreement The proposed lease has a one year term, requires $500 /month when Fitch is operating the Dairy Queen, and requires Fitch to pay for taxes, insurance, and utility costs. Fitch's attorney originally proposed a lease; however, Jim Hoeft subsequently_ prepared the lease which is attached to this memo. Recommendation Staff recommends that the HRA approve in concept the proposed settlement terms for acquiring the Dairy Queen property up to a total amount of $167,500. Further, the HRA should move to permit the Attorney's office and staff to prepare the settlement agreement, purchase agreement, and other necessary documents, and to authorize the Executive Director and the Chairperson to execute said documents when in compliance with the HRA direction. Please note that Fitch will be present at the meeting proposing that the HRA include an additional $500 (raise the purchase price from $157,500 to $158,000) for payment of his attorney's fees. Finally, staff recommends the HRA approve the lease agreement as presented. BD:ls M -91 -560 2 -A . 612 780 1777 FROM SARNA GUZY LAW MPLS. 8. 1.1991 15=53 P. 2 To L$A88 THIS AOREBMENT, made this 25th day of July, 1991, by and between the Fridley Housing & Redevelopment Authority (hereinafter designated as "Lessor ") and (hereinafter designated as "Lessee "). WITN9882TH: That the Lessor, for and in consideration of the terms, covenants, rents and conditions herein mentioned, to be paid and performed by Lessee, does hereby demise and let unto said Lessee, and the said Lessee does hereby hire and take from the Lessor, the following described premises situated in*the City of Fridley, County of Anoka, State of Minnesota, to -wit: n The East 75.1 feet of the North 158 feet, subject to Mississippi Street easement, of Lot No. 30 Block 1, Sylvan Hills Plat S. Anoka county, Minnesota, including the northerly 30 feet of the westerly 75.1 feet of that portion of vacated 64 -1/2 Avenue lying immediately South of said property. TO HAVE AND TO SOLD, the same: just as they are, without liability on the part of the Lessor to make alterations, impxvvements or repairs of any kind in and about the demised premises, except as and if otherwise set forth herein, for the term of one (1) year from the 25th day of July, 1991 through and until the 24th day of July, 1992 for the following purposes, and for no other purposes, to -wit: 1. Operation of the existing Dairy Queen business. 2. Lessee agrees to pay Lessor as and for rent for the above mentioned premises, in monthly installments of $500.00 Dollars each during operating months, in advance on the first day 2 -B 612 780 1777 FROM ERRNA GUZ Y LAW MPLS. G. 1.1991 1553 a P. 3 2 -C of each and every month during the full term of this Lase at the office of the Lessor, or at such other place as Lessor may in writing designate. For those months that Lessee is not in operation, Lessee shall pay no rent other than as net forth hereinbelow. if Lessee is in operation during any portion of any month, Lessee shall pay a per diem prorated amount of said $5oo.00 in addition to the entire coats to Lessee as set forth below. In addition to the rent specified in the preceding Paragraph (the "base annual rental"), Lessee agrees to provide for and pay the cost of maintaining the parking areas, grounds and sidewalks serving the leased premises. Such costs shall include .lighting, snow removal, line painting and replacement of paving, QuLbs and sidewalks, if necessary. The cost of operation and maintenance shall include taxes and assessments. Further, the Lessee shall promptly pay the costs of all utilities, including, but not limited to electricity, telephone, sewer, water, refuse removal and natural gas. 3. Lessee agrees that it will not sublet the demised premises or any part thereof and will not assign this Lease or any interest therein. 4. Lessee shall provide or pay for all repairs and maintenance of the premises including, but not limited to, glass breakage, furnace, plumbing, electrical systems, structural repairs, parking and other exterior maintenance. S. Lessee agrees to indemnify and hold the Lessor harmless for any liability arising out of the Lessee's use of the premises. For this purpose the Lessee shall at his sole expense 612 780 1777 FRGM BARNA GUZV LAW MPLS. B. 1.1991 15:54 P. 4 2 -D procure and maintain comprehensive public liability insurance for the demised premises during the term hereof in the minimum amount of Three Hundred Thousand -Five Hundred Thousand Dollars ($300,000.00 - $500,000.00) bodily injury and One Hundred Thousand Dollars ($100,000.00) property damage. Lessee shall provide Lessor with evidence of such insurance prior to occupancy. Lessee shall at his sole expense procure and maintain insurance for his fixtures and equipment within the demised premises. 6. Lessee to obtain workers compensation insurance. Lessee shall maintain and keep in force all employees compensation insurance required under the laws of the State of Minnesota and such other insurance as may be necessary to protect Lessor against. any other liability to person or property arising hereunder by operations of law, whether such law is now in force or is adopted subsequent to the execution hereof. 7. Lessee to furnish certificate of insurance. Lessee shall furnish to Lessor a certificate of insurance showing that his liability insurance policies are in full force and effect and naming uessor as an insured thereon. The policy shall further provide that Lessor shall be given a minimum of ten (10) days notice by the insurance company prior to cancellation, termine ion or change of such insurance. Such policies or duly executed certificates of insurance shall be delivered to Lessor prior to the commencement of Lessee's occupancy hereunder and renewals thereof shall be delivered to Lessor at least thirty (30) days prior to expiration of the respective policy terms. 612 780 1777 FROM BARNA GUZY LAW MFLS. S. 1.1991 15:55 S. The Lessee consents to allow the Lessor to make any necessary alterations to the said property in the manner necessary for the Lessee to operate and conducts his drive - through business. 9. Lessee covenants and agrees that he will make no y P. 5 2 -E structural change or major alteration without the Lessor's consent, which consent shall not be unreasonably withheld, provided that the proposed improvements are consistent with the use of the property, do not significantly reduce the value of the property and do not violate any local, states or Federal laws, and without first furnishing the Lessor with five (3) days advance written notice outlining the proposed changes or alterations. Upon the City consenting to the alterations, then the City will issue all necessary permits without unreasonable delay. The Lessee further covenants that it will promptly pay for any alterations, repairs or maintenance made to the demised property so that no mechanic's liens will be filed against the property. In the event a mechanic's lien is filed, the Lessee shall have twenty (20) days to pay or in the alternative to post 1 -1/2 times the lien amount with the district court in order to contest it. Failure to do either of the above mentioned lien corrections shall be deemed as a default under this Lease. In any event, the Lessee shall indemnify and hold harmless the Lessor for any and all costs or removing said lien. 10. The Lessee agrees that upon termination of this Lease, all improvements to the property, together with all fixtures, shall become the property of the Lessor. 612 780 1777 FROM BARNA GUZV LAW MPLS. B. 1.1991 15:55 P. 6 2-F 1 11. Lessor shall at all times have the right to enter upon said premises to inspect its condition and at its election to make reasonable and necessary repairs thereon for the protection and preservation thereof -but nothing herein shall be construed to require the Lessor to make such repairs except as may be herein provided for and the Lessor shall not be liable to the Lessee for the failure to delay in making such repairs or for damage or injury to persons or property caused in or by the making of such repairs or the doing of such work. 12. Lessee agrees to pay for all special requirements for utilities such as gas, steam, water and electricity and for all other alterations, modifications or other services to the demised premises. Charges for any such utilities or services shall be paid by Lessee and, in the event such charges are not paid when due, the same shall constitute a default hereunder on the part of the Lessee. 13. The premises shall not be used for lodging or sleeping or for any immoral or illegal purposes. 14. The parties hereto mutually agree that if the demised premises are partially or totally destroyed by fire or other hazards, then Lessor may, but is not obligated to, repair and restore the demised premises as soon as is reasonably practicable to substantially the same condition in which the demised premises were before such damage. The Lessee may repair the damage as allowed under Paragraph 8 at his own expense. in the event the demised premises are completely destroyed or so badly damaged as not to be useable by the Lessee for the purposes herein provided, 612 780 1777 FPOM SAPNA 6UZY LAW MPLS. S. 1.1991 15-56 P. 7 2 -G then this Lease shall be terminable by either party hereto by serving written notice upon the other7 and provided, further, that in any event if repair• have not been commenced within thirty (30) days from the date of said damage and thereafter completed within a reasonable time, in no case to exceed three (3) months, this Lease may be immediately terminated by the Lessee by serving written notice upon the Lessor. is. The Lessee acknowledges that he is aware that Anoka County intends to widen Mississippi Street along the north boundary of the property and that in the course of doing so the County intends to acquire a portion of the property. The Lessee acknowledges that he is waiving any and all claims to any c:ompeilsatiot1 or monies that the Lessor may receive from the county as a result of this taking. Further, the Lessee agrees to waive any claim that this acquisition by the County constitutes a breach of this Lease. 16. THIS PARAGRAPH DESCRIBES THE CONDITIONS UNDER WHICH THE LESSOR MAY TERMINATE THIS LEASE EARLY, YOUR SHOULD READ THIS PARAGRAPH CAREFULLY. In addition to the provisions contained elsewhere in this Lease, the Lessor may terminate this Lease prior to expiration date and without cause upon the Fridley Housing & Redevelopment Authority making the determination that it needs to terminate this leasehold interest as a result of development intended for this site or elsewhere in the southwest quadrant of Mississippi and University. This termination can only be effective upon the giving of ninety (90) days written notice by the Lessor to the Lessee. 612 780 1777 FROM SARNA SUZY LAW MPLS. 8. 1.1991 15156 P. 8 2-H 1 17. In the event that the Lessee shall continue to occupy the demised premises after the expiration of the term of said Lease, such "holding,over" shall be on a month to month basis. Either party may terminate said "holding over" by giving the proper notice, as required by Minnesota law, to terminate a month to month tenancy. 18. The Lessee hereby agrees to waive any right or benefits he may have as a Lessee under this specific Lease pursuant to the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (40 U.S.C. 4601) and will provide Lessor with a signed waiver upon request. It is understood that the parties have entered into this Lease as an accommodation to each other. Upon the proper termination of this Lease, the Lessee will not be entitled to any compensation or damages for the termination of the Lessee's leasehold interest. 19. No sign shall be painted or affixed by the Lessee on any part of the outside of the demised premises without prior written consent of the Lessor. In the event of a violation of this clause by the Lessee, Lessor may remove said sign without any liability and may charge the expense incurred by such removal to the Lessee. The Lessee is permitted to substitute a sign on the building which would be affixed in substantially the same location as any existing sign and shall be constructed of letters which are substantially similar to and which letters do not collectively or significantly exceed the size of any current sign. The Lessee is also permitted to maintain the free- standing 612 780 1777 FROM BARNA GUZY LAW MPLS. S. 1.1991 15:57 P. 9 2-1 pylon sign on the property in conformance with the city of Fridley's Sign code. The Lessee is responsible for all costa and charges pertaining to its maintenance. 20. If the Lessee shall make default in any covenant or agreement to be performed by him and if after written notice from Lessor to Lessee such default shall continue for a period of five (5) days or if the leauchold interest of the Lessee shall be taken on execution or other process of law or if the Lessee shall petition to be or be declared bankrupt or insolvent according to law, then, and in any of said cases, the Lessor may immediately or at any time thereafter without further notice or demand, enter into and upon said premises or any part thereof and take absolute possession of the same fully and absolutely without such re -entry working a forfeiture of the rents to be paid and the covenants to be performed by the Lessee for the full term of this Lease, and at Lessor's election, Lessor may either lease or sublet such premises or any part thereof on such terms and conditions and for such rents and for such time as the Lessor may reasonably elect and after crediting the rent actually collected by the Lessor from such re- letting collect from the Lessee any balance remaining due on the rent reserved under this Lease, or Lessor may declare this Lease forfeited and may take full and absolute possession of said premises free from any subsequent rights of the Lessee. That in the event of default by the Lessee, the Lessee shall compensate the Lessor for all reasonable attorneys fees, expenses and costs incurred by the Lessor in either reaquiring 512 7£30 1777 FFOM BAP.NA BUZY LAW MPLS. /1-1 8. 1.1991 15 :57 possession of the property or for bringing an action for the recovery of unpaid rent. P.10 2-j 21. Wherever in this Lease it shall be required or permitted that notice or demand be.given or served by either party to this Lease to or on the other, such notice or demand shall be given or served and shall not be deemed to have been given or served unless in writing and forwarded by mail addressed as follows: To The Lessor= Barbara Dacy Community Development Director Fridley Housing & Redevelopment Authority 6431 University Ave. N.E. Fridley, MN 55432 To The Lessee: Such addresses may be changed from time to time by either party by service of notice as above provided. The Lessor and Lessee agree that all the provisions hereof are to be construed as covenants and agreements. IN WITNESS WHEREOF, the Lessor and Lessee have caused their respective names to be subscribed to this Lease on the date first above written. In the Presence Of: In the Presence Of: LESSOR: FRIDLEY HOUSING & REDEVELOPMENT AUTHORITY BY: LESSEE: BY: 612 780 1777 FROM BARNA GUZY LAW MPLS. G. 1.1991 15:58 STATE OF MINNESOTA ) )SS. COUNTY OF ANOKA ) The foregoing instrument was acknowledged before me this 25th day of July, 1991. THIS INSTRUMENT WAS DRAFTED BY: BARNA, GUZY & STEFFEN, LTD. 400 Northtown Financial Center 200 Coon Rapids Boulevard Coon Rapids, MH 55433 (612) 700 -8500 P.11 L 2 -K PRELIMINARY SETTLEMENT TERMS 1. Purchase price $157,500 $125,000 already paid, $32,500 at closing 2. Relocation payments $10,000 a. Actual reasonable expenses in moving himself, his family, business, farm operation, or other personal property; b. Actual direct losses of tangible personal property as a result of moving or discontinuing a business; C. Actual reasonable expenses in searching for a replacement business; d. Actual reasonable expenses necessary to re- establish a displaced farm, non - profit organization, or small business at its new site, but no to exceed $10,000. Health Department will require brand new counter, cooler, cabinet, and freezer to be installed in new facility. 3. Fitch wants to: a. move cabinets b. remove fence and deck C. willing to dispose of walk -in cooler and freezer 4. Lease agreement a. Fitch pays all operating costs. b. Fitch pays rent when operating - $450 /month $500 /month only if HRA pays $500 for attorney's fees 5. HRA will make any adjustments in drive - through, if warranted next spring by Mississippi Street widening project. Total package - $167,500 +/- $500 i��, 2 -L Taxes Electric Gas W/S Insurance Subtotal DAIRY QUEEN OPERATING COSTS Total for Year $2,266.95 3,626.08 478.10 53.00 1.525.00 $7,949.13 Per Month $188.91 300.00 40.00 4.42 127.08 $660.41- • Rent @ $450 (Fitch's offer) $1,110.41 $500 (HRA's offer) $1,160.41 • only when operating, 9 -10 months per year 2 -M 2 -N n CIiYOF FRIDLEY FRIDLEY MUNICIPAL CENTER • 6431 UNIVERSITY AVE. N.E. FRIDLEY. MN 55432 • (612) 571 -3450 • FAX (612) 571 -1_'87 July 24, 1991 Don Fitch Fridley Dairy Queen 280 Mississippi Street N.E. Fridley, MN 55432 Dear Don: This is to outline the operation of the Dairy Queen after the Fridley Housing and Redevelopment Authority (HRA) takes possession on July 25, 1991, and prior to finalization of a written lease agreement at the Fridley HRA meeting on August 8, 1991. Until such time, please be advised that you will be responsible for all utility costs, repair or maintenance costs, and any other costs that are incurred either as a direct or indirect result of the operation of the Dairy Queen. While the HRA is in the process of arranging to add the building and real property to its insurance policy, please be further advised that you continue to be the owner of all existing equipment and other personal property on the site, and you should take adequate precautions to protect and insure said property. Sincerely, Barbara Dacy Community Development Director BD:ls cc: Jim Hoeft, Attorney William Burns, Executive Director of HRA C -91 -235 �i 3 11 Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY DATE: August 1, 1991 City of Fridley TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Consideration of Proposal by University Avenue Associates Regarding Restructuring Second Mortgage for Springbrook Apartments Request Sherrill Oman, the attorney for University Avenue Associates (the developer of the Springbrook Apartments) is requesting conceptual approval of two items pertaining to the current second mortgage for the Springbrook Apartments project. Oman indicates that University Avenue Associates is refinancing its mortgage through an FHA- Insured mortgage. The Department of Housing and Urban Development administers the FHA- Insured loan and stipulates a number of requirements regarding subordinated debt. Because of these requirements, Oman has indicated that they are requesting the HRA to subordinate its existing mortgage to the new FHA- Insured mortgage (as previously done), plus she is asking us to cooperate in restructuring the debt to meet HUD regulations. Analysis It is highly likely that the amount is currently at $850,000, would have amount. Oman makes it clear that reduction, and they fully intend to agreed upon amount. We have asked Casserly, to address the security of if it is for a lesser amount than remainder to be secured. of the second mortgage, which to be restructured to a lower they are not asking for any repay the HRA the originally - our financial consultant, Jim the new second mortgage; and, originally issued, how is the As of the writing of this report, Casserly was in the process of contacting Oman and to investigate further. We will be enclosing his written comments in this packet. Casserly will be present at next Thursday's meeting to answer questions. In any case, Oman requested that the HRA indicate its preference to proceed on this matter. The HUD application fees are non - refundable and are quite expensive ($30,000- 40,000). Therefore, the petitioner is requesting that the HRA be as straight - forward as possible as to its preference. Consideration of Proposal by University Avenue Associates Regarding Restructuring Second Mortgage for Springbrook Apartments August 1, 1991 Page 2 One positive aspect of the refinancing with the FHA- Insured loan is that HUD requires a "replacement reserve fund" for the purpose of maintaining the project and replacing capital items as they wear out. Oman indicates the replacement fund would range from $450 to $750 per unit. This amount of money plus a monthly deposit into the reserve fund would ensure that the project is maintained in an orderly and pleasing appearance for a long period of time (the length of the loan is 35 years). Long term maintenance of apartment buildings has always been a concern to the community. Recommendation Staff recommends the HRA review Casserly's remarks and recommendations regarding the restructuring of its debt. At minimum, we want to ensure that the same security that we currently hold via the second mortgage will be maintained under the new financing structure. Casserly may suggest additional criteria the HRA may want to impose prior to agreeing to the refinancing. BD:ls M -91 -561 3 -A JUL 31 '91 13 :38 FLINT612-334_3382_ F.2 ICJ Casserly Molzahn & Associates, Inc. 215 South 11th Street, Suite 300 • Minneapolis • Minnesota 55403 Office (612) 342 -2277 • Fax (612) 332 -4765 M X M O R A N D U M TO: City of Fridley HRA William Burns, City Manager Barbara Dacy, Community Development Director FROM: James R. Casserly DATE: August 10 1991 RE: Springbrook Apartments Refinancing The Hu'D guaranteed mortgage which the owners of Springbrook Apartments are attempting to use to refinance this project is described in the letter from Sherrill R. Oman, the attorney for the partnership. Ms. Oman's letter also points out the problems with secondary financing (the HRA mortgage) under HUD regulations. The problems are the size of the second mortgage is limited and it will not be in default if project revenues are not adequate to pay it. The $850,000 Note may be in default, but the mortgage could not be foreclosed if the project revenues are insufficient. As a result the partners would have to provide additional contributions to the partnership to pay the Note or make some additional arrangements to honor their guarantee. JUL 31 '91 13 :39 FLINT612_33-2-+4_3302_ P.3 3 -C The HRA will probably not have the asset (the Apartments) as full security for the Note. Please remember that currently the HRA has only a second mortgage and if it were to liquidate the Apartments to collect'on the Note, it would have to pay off the first mortgage of $14 million. The HRA does, however, have personal guarantees by the partners. The HRA should consider a new subordination under the following circumstances: /1- That the project pro forma demonstrates an ability to pay the HRA Note. 2. That an appraisal of the project shows that net sale proceeds would be adequate to pay the HUD guaranteed debt and the Note (not just the HRA debt secured by the second mortgage). 3. That at least 75% of the Note be secured by assets (this may include assets other than the Springbrook Apartments). 4. That the cumulative financial net worth of the guarantors exceeds $10 million. (This amount is contained in Article 4 of the Mortgage Guaranty presently in effect.) 612 786 6711 3 -D �Mr. wiliiam Burns, City Manager and Chair and Commissioners of the Housing and Redevelopment Authority City of Fridley 6431 University Avenue Northeast Fridley, Minnesota 55432 Re: Springbrook Apartments Ladies and Gentlemen: We are a."t?.nn as counsel to University Avenue Associates, the owner of the Springbrook Apartments Project (Springbrook) in connection with the refinancing of its existing $14,000,000 loan with Citicorp Real Estate, Inc., which matured June 1, 1991- As you know, Springbrook is also subject to an $850,000 second mortgage in favor of the City of Fridley. It is the intent of University Avenue Associates (the Owner) to refinance the Citicorp mortgage through an FHA - insured mortgage which will have a term of 35 years. The Owner is gathering the information required by HUD to submit an application for the FHA - insured loan. We do not know the amount of the loan that will be approved by HUD; however, we do know it will not be enough to pay both Citicorp and the City of Fridley at this time. Accordingly, we will be requesting the assistance of the Housing Authority in two areas. First, we will be asking the Housing Authority to subordinate its existing mortgage to the new FHA - insured mortgage, as the Housing Authority has agreed to do in the Contract for Private Development between the Owner and the Housing Authority. In addition, we will be HUr'Y *IAN, DA LY GG 1.jN7�C3$E`�T, LTD • PAVL L. KILDOW11 L NILOOW LARKIA', µAN C NEWMAN �L:C1 F .ARN•N 11[NT L HOFFYAN ATTORNEYS AT LAW K/.TMLCI L 111ARO w.CMACI O.L[OANON OrttOORv e..Io1OTAn .CN F. "LV O, .tCNNfF�I LINDONEN 0^0,1 A VAN CLCVC 1A/ ft W. ,RICDCLL O1 YIF.MA[L 1. ORAMAN ALLAN f Yu LL.OAN wOBERT J. MCNNG01tY 1800 NORTHWESTCRN FINANCIAL CENTER 8000 PIPER JAFFNAT TOWER OQuNA L NOCACK AMT OANR ORADY JAUC1 C -1:11-VON tOWARO J. V*I$COLL 7000 XERXES AVENUE SOUTH §Z2 SOUTH NINTH STREET J[FFNCT G. AHOCNOON DAN ICL L. LOwLEs OtME W FJLLCR QAVIO C. OtLLGRORCN BLOOMINOTONI MINNESOTA 55431 MINNEAPOLIS. MINNESOTA 68402 TOGO M. VLATKOV.Cu TIIAOTMV J. MOMANJO JOHN O. FULLMGR TELEPHONE (6121 338'6610 MICNACL A. ROYCRT'!OV NOSGRT r- DOYLE TEI.EpMONE (S12: 63S -3800 L /s ^A. ortAr FNANN I, MANVEV C�•ARLEO 1. MOMELL FAX (5121 335 -976C PAX (e121 SP6 -33.3, OAPV A. NENNGNE TMOMAO M. WCAVC' 0I4R1[TOrMER J. O•CT[EN MR•OO LHANNON N. MOOAO C JONN O. RCATT:C JULIC A. WNACC L.NeA M. FIOMFN ow"ISTOOHCN .1. MAIIR•iTNA. TMOMAO O 1TOLTMAN OMANON I. 1R946NA LT[VON O. VrVIN MARINAV IRAN ►OA LITCAU w ICYACI F.. JACKM&N TIHOTMV J. [CANE JOHN G AIOwL WILLIAM e.ONIFFITH. JR. JOM L OWi(17f WOK, JOHN J. �TCFFCNMAOCN TMOMAI J. rIrNN OAN11L NL VO11 dAM [1 P. 111I1NN MAN■ A PUOIA 10D0 .. FOrCMAN JOHN N. WILL OTSOMEN 1. 110IFiMCN JAMES K.MART.N F -Tom A. OOI: /. T11011A1 J. OLTMOUO JLNOM[ M. .AUNNc M.MIACL J. 11141TM LNCORILL N. OMAN O[RALD L. 1fCK NCMAV W. LCONC FNCOCNIt. A.MAUOCR III .IF1MN L. LUNDQUIST MAOV F. VOL FHTI.( .01AN • LON lied A. OINOCR TMOMAI R MUMAMRCV. Jrt M.rMAFI T MGAIM MEOMAN \TALLC Reply to Minneapolis 1/INCcNT O. GLLA ANONCW J. YITCNCLL of GOUNSC. WCNOOLL N. ANOCOOf1N JO,IM A. COTTFR■ OIIAIILCO 0. WOAVCO NOATNIOC A. ROTMWC.1 ER ,000[w O /TIL 11e:NAOD A. NOIIDOVC OAVI0 J. PAT N A. an AOMITT[O IN July 19, 1991 W11100 "I" �Mr. wiliiam Burns, City Manager and Chair and Commissioners of the Housing and Redevelopment Authority City of Fridley 6431 University Avenue Northeast Fridley, Minnesota 55432 Re: Springbrook Apartments Ladies and Gentlemen: We are a."t?.nn as counsel to University Avenue Associates, the owner of the Springbrook Apartments Project (Springbrook) in connection with the refinancing of its existing $14,000,000 loan with Citicorp Real Estate, Inc., which matured June 1, 1991- As you know, Springbrook is also subject to an $850,000 second mortgage in favor of the City of Fridley. It is the intent of University Avenue Associates (the Owner) to refinance the Citicorp mortgage through an FHA - insured mortgage which will have a term of 35 years. The Owner is gathering the information required by HUD to submit an application for the FHA - insured loan. We do not know the amount of the loan that will be approved by HUD; however, we do know it will not be enough to pay both Citicorp and the City of Fridley at this time. Accordingly, we will be requesting the assistance of the Housing Authority in two areas. First, we will be asking the Housing Authority to subordinate its existing mortgage to the new FHA - insured mortgage, as the Housing Authority has agreed to do in the Contract for Private Development between the Owner and the Housing Authority. In addition, we will be 612 786 6711 3 -E T.AaNrN, Iic�t, I1.aLY &- LINDOREN. LTD. —� Mr. William Burns and Chair and Commissioners July 19, 1991 Page 2 asking the Housing Authority to restructure its debt to meet certain HUD regulations. waechange sinntheopaymentuprovisinshe amount due nor are we asking f or a HUD regulations restrict the amount of debt. the owner of a project may incur. The amount permitted is the lesser of 7 1/2 percent of the HUD appraised value of the theo3roject and percent max�mum the mortgageeamountbetween the cost to refinance P determined by HUD. The cost to refinance includes all debt, deposits required to be made to a replacement reserve fund to insure that sufficient funds are available to maintain the property and make capital repairs as necessary, legal hitects, engineers, fand �inspecti n fees, and points" repair costs, arc paid to obtain the financing. The outstanding debt on springbrook is approximately $14,650,000. Using these numbers, and assuming an additional cost to refinance of would 00, the Subordinate debt illustrates how would work. Sof $lt percent of the HUD appraised value) to the lesser of $1,237,500 (7 1/2 p or $600,000 (50 percent of the difference between the cost to refinance and the maximum mortgage amount determined by HUD). Accordingly, the maximum additional debt that could be incurred by the Owner to be paid out of revenues from the project would be $600,000. In addition, HUD requires the subordinate debt to be payable only out of surplus cash. Surplus cash is defined as all cash remaining after payment of the amounts due under the HUD note, amounts required for the reserve footherreplacements, words, surplus cash isr the namountn e available for project. In distribution to the Owner. Because of these restrictions, we are requestiny the Housing Authority to consent to the concept of reducing the amount of the note and mortgage executed by the Owner and payable from project funds to the amount that will be permitted under the HUD regulations once the amount of the HUD appraised value and approved mortgage is determined. We are requesting the remaining debt, not covered by the now note and mortgage, be evidenced by a note from the Owner, payable to the Housing Authority, but solely out of capital contributions or loans from the partners to the partnership. The guarantees of the partners to the Housing Authority of repayment of the debt would remain in place. n We believe, after extensive exploration of the availability of financing, the HUD mortgage is both the best and perhaps the only 612 786 6711 L,4lti�iNr IIQFFMA-N, DnJY & L Il-InCIRE1. LTD. Mr. William Burns and Chair and Commissioners July 19, 1991 Pafle 3 source of refinancing available to us at this time. we also believe it is of benefit to the Housing Authority and City because it will provide permanent financing for Springbrook, fullheamortized over 35 years. Thus, the ability of the Owner to repay significantly enhanced. Secondly, HUD requires an initial deposit to a replacement reserve fund for the purpose of maintaining the project and replacing capital items as they wear out. This replacement fund deposit will likely be from $450 to $750 per unit. in addition, will require a monthly deposit to be made to the replacement reserve fund so that at all times sufficient funds will be necessary, as determined by HUD, to properly maintain the project. We are asking for concept approval from you prior to making the actual application to HUD for the mortgage because the application fee that must accompany the application is $3 p er $ 1,000 of the requested mortgage amount to be insured. In general, this fee is nonrefundable. We understand you will be approving only the concept and such approval will be subject to analysis by you and your consultants of the documents and the actual economics of the proposal as that information becomes available. The Owner further understands it would be responsible for your outside consultant's fees in connection with such review and analysis. we appreciate your consideration of this matter and respectfully request your consent. 11 1 Sincerely, Sherrill R. Oman, for LARKIN, HOFFMAN, DALY & LINDGREN, Ltd. SRO /peb cc: Mr. Harry Yaffe, University Avenue Associates SRO=KJls 3 -F � � Community Development Department D HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: July 22, 1991 TO: Jim Casserly, Consultant FROM: v8arbara Dacy, Community Development Director SUBJECT: Letter from Attorney for Springbrook Apartments Attached is a letter from Sherrill Oman representing the Springbrook Apartment project owners to restructure the HRA's second mortgage. They indicate that they are not changing the amount of the second mortgage or the payment schedule, but are requesting that the HRA reduce the amount of the note and mortgage and that the remaining debt be secured by a, new note from the owner. I intend to schedule this for concept approval by the HRA at its August 8, 1991, meeting. Prior to that meeting, however, I would like to receive your comments, especially about how the mortgage would be restructured and secured. Specifically, please comment on paragraph 4 of page 2 of her letter. Also, make sure to separately identify your work on this so we can forward your invoices to Oman's office. BD:ls cc: William Burns, Executive Director of HRA M -91 -541 V, 1 3 -G E Community Development Department D HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: July 29, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Consideration of Approval of Mortgage Satisfaction for Earley Residence John and Therese Earley have contacted me to request that the HRA record the attached mortgage satisfaction document regarding the second mortgage on their property at 6041 - 3rd Street N.E. The Earleys were one of seven participants in the Large Family Home Ownership Program (the HRA approved two mortgage satisfactions documents in April 1991). The program was designed to encourage the homeowners to live in the newly constructed homes for at least ten years. If the owner lived within the property for ten years, then the second mortgage amount was forgiven. In the case of the Earley mortgage, it was dated September 25, 1980. Recommendation The attached Mortgage Satisfaction Agreement is recommended for approval by the HRA. BD:ls M -91 -553 4 -A Satisfaction of Mortgage By Corporation KNOW ALL MEN BY THESE PRESENTS, That a certain Indenture of Mortgage, now owned by the undersigned, a Public Corporation, existing under the laws of the State of Minnesota, bearing the 25th day of September, 1980, made and executed by John A. and Karen Theresa Earley, husband and wife, as Mortgagors, to the Fridley Housing and Redevelopment Authority, a Minnesota Public Corporation, as Mortgagee, and recorded in the Office of the County Recorder in and for the County of Anoka and State of Minnesota on the 26th day of September as Document 557057, is, with the indebtedness thereby secured, fully paid and satisfied upon the record thereof, according to the statute in such case provided. IN TESTIMONY WHEREOF, The said Corporation has caused these presents to be executed in its corporate name by its Executive Director this day of , 1991. FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY ^. BY: William W. Burns Its Executive Director STATE OF MINNESOTA ) ) ss. COUNTY OF ANOKA ) The foregoing was acknowledged before me this day of , 1991, by William W. Burns, the Executive Director of the Fridley Housing and Redevelopment Authority, a Public Corporation under the laws of Minnesota, on behalf of the Public Corporation. THIS INSTRUMENT WAS DRAFTED BY: CITY OF FRIDLEY 6431 University Avenue Northeast Fridley, MN 55432 (612) 572 -3590 :........,. m•1¢a� nun Form No. 42 -M Minn ,u Under (:onvcyancinit Dlanks (Rcviud 1974) Indl•�__- 5'705'7 Us; Nbenturei Made tltia.._ _......> . ............................day of....... . ty Jkr ....... r9.ao...., between .. ............... ............. ............................... ........................................................ ............................... JOHN A. EARLEY AND KAREN THERESA EARLEY, husband and wife Hennepin and State of Un eeata ................._ .... Mortgagor...., Ofthe County of.._ ............................ . ....................._...._.... arid__...- ... -.... FRIMEY ..HOUSING- AND..BEDEYELOPMENT.. AUTHOR' TE .............................................. _ .......... _........... ............ _ ....................... -................. ............................... _.... - -.... ...•.- l+ fi- ctttesota•• Pnblf�... '....'..........._ ............. Mortgagee..... a dorporatioa under the laws of the State of ................... .....Minnesota........••••••••" "' Mitneggefij, That the said mortgagor...., in consideration of the sure of_jevj ..thousand..... ...... Ty. 0- Ruadred- and ..Q01100th&-- 07.*X00a.00). -- ._ ................... ._._.._.............---- . ---- -. -DOLLdR , to_thP.At ...............in hand paid by the said Mortgagee, the receipt whereof is hereby acknowledged, do hereby Grant, Bargain, Sell, and Convey unto the said Mortgagee, its successors and aaigns, Forever, all the tract.... or parcel_... of land lying and being in the County of__... Anoka ................••••••••••••. and State of Minnesota, described as follows, to -wit: Lot Twenty -four (24) and the Northern One-half of Lot Twenty -three (23) Block Five (5), Hyde Park go jbabe anb to *01b dje Maine, Together with the hereditaments and appurtenances thereto belonging to the for..._. themselves, . their... .... ........................... said mortgagor, its successors and assigns, forever. And the said mortgagor........, Its successors and assigns, as follows: heirs, administrators, executors and assigns, do ................... covenant with the said mortgagee, successors That..... ..tklf'Y.. #x .C..........lawfully scize of said premises and ha.V.e.........good right to sell and convey the same. that the same are ...... «sin First• mnrtea2e which_w111,...0 Al.S .Rtad....s.4bp.g%ognt free from all ..._ inert a or and United _...... 5» .8 ......... ..........._.._...._ M_ o-rt a e .. _ - •••••••••Cor - ••••• - -- - -- %,W Warrant and that the mortgagee. its suecOmrs and assigns, shall quietly enjoy and possess the same; and that the mortgagor........ Defend the title to the same against all lawful claim- not hereinbefom specifically excepted. probtbeb Aeberdjelegg, That if the said mortgagor..._..., .......thejr..heira, administrators, executors or assigns shall pay to the said worlgagee, its suers or assigns, the sum oL ._@V2tL..�l1RtlA #Aid0...uAdR#SI .fA11tI :OI1%lara, i1U a according to the terms oL.....tbAt._reStiA;Lu. mlQr OUI .pnacipal promissory, note..._- of avan date herewith due end payable, • r cent Per annum ................ ............................... ...................... .........................._.... with interest thereon at the rate ot...eiFaht...(B %a• -Pe ............................ ..... ................ ............................... ............................................. ... executed by the said mortgagor......., and payable to said mortgagro, at its ofiice » ................................. ............................... ...................................................».................................................................................................... ............................... and shall n +pay to said mortgagee, its successors or assigns, at the times and with interest as Msreinafter specified, all sums -dean in protecting the lien of this mortgage, in payment of taxes on acid promises, insurance premiums covering buildings thereon, principal or on any prior liens, expenses end attorneys' fees herein provided for and sums advanced for any other purpose authorized herein, interest and perform all the sand to and agreements herein contained then this deed to be null and void, and to be released at and shall an the mortgagor's expense. themselves their .....__.heirs, administrators and executors, do ............ hore y AND THE AfOIiTOACOR........, for .............. ..._•- ••-- •- ••a•••••••- •••• -••• sum of mores and interest as above specified; covenant and agree with the mortgagor. its suc«�sota and asvgna, to pay the Pnneipd Y taches to pay all taxes and assessments now due or that may hereafter become liens against acid premises at least ten days by for ty -least the thereto; to keep any buildings on said premises insured by companies approved by the mortgagee sgeieat Y sum of .. ............... F. olty.:r. four-.Thouaaact..and..DI1110Oxha_ and against lose by windstorm for and the sum of ........................ .....F,arLy.:.iAnr...Thtausa�•- and _ n0�lonLhs.. ..i��+.it..oQ0..0o._._.Dnllars, ana to -diver to mid mortgagee attached in favor of sold mortgagee or its assigns; to pay, when due, both principal the Interest for such Insurance or with mortgage . if se above mentioned and to keep said premises free and clear of all other prior liens and interest at sH prior liens or iacumbrsnces, if n said to complete forthwith any improve - or Incumbranew; to commit or permit no waste on said premlesa and to keep them in Good repair; meats which may hereafter be under course of construction thereon. and to pay any other eicpsnlsee and attorney's [sea Incurred by said mortgagee. its successors or assigns, by reason of litigation with any third party for the protection of the Hen of this mortg age. are ,ygnt cd in W or -rain, ed at —by -ified; sachem st the gum of tgave acipal ,r liens prove - ,v acid In case of failure to pay said taxrP and aavammant-% prior item or incumbrances, expenses and attorney's fees as above spodiiied. or to Intim acid buildings and deliver the policies as afereseid, the trudgaRk its successors or assigns, may pay such taxes, ancesments. prior Ilene, expenses and attorney's face and interest theraun, or effect such Insurance, and the sutra so paid shall hear interest at the highest rate permitted by law from the data of such payment, shall be Impressed d as an mortgagee,, additional lion upon or promises n d e mortgage he Immedl- stely due and �s or assigns' to Payable from the mortgagor........, their..... shall from date thereof secure the repsyment of such advances with interest. In an of default in any of the foregoing covenants, the mortgagor........ confer........ upon the mortgagee the option of declaring the unpaid balance of said principal note and the interest acetucd thereon, together With all sums advanced hereunder, immediately due and pagable Without notice, and hereby authorize and empower said mortgagee, its sueemors and assigns, to foreclose this mortgage by judicial proceedings or w sell avid premises at public auction and convey the same to the purchaser in fee simple in accordance with the statute, and out of the moneys arising from sue, Halo to retain all sums secured hereby, with Interest and all legal costs and charges of such foreclosure and the maximum attorney's fin permitted by law, which costa, charges and ices the mart gsgar. ....... herein ages........ to pay. 3M 1:eoflmonp Wbered. The said Mortdadors. have hereunto act..__ - their ..................... hand. -.rs the dab and year first above written. _ .. o.. %... .......... ....................... A. Earley -kaien Theresa iE'ii .................. _ ... _._................................... ............................... . Mate of Imainne0ota, County or _.. .- m- ou......................_. The joredoind l,rxtr, neat eras aek -n-a Madded heferr ►ur ..�. cc b ....... .................. ...................... 19.._8.0.. ., thisa� " "••• d° °/- John A. Earley and Karen Theresa Earley, txtis,v venA,�AAnniAAnFAr.. n.4wAwMn■ husband and wife ............................... ....... JOAN A ANDERSON � �� � � /NA IH UKOM At:NoT aat+ PUbtic = alt+!t'sota ANOKA COWiTY .�br - fiycommis4iLttEx�tfasSep .26,1980 (SIGNTURE UP pKINn AIaNOWLen(eMeNf) " ✓ Notary.. Publ is ......................... .. ..... titTtB ON RANK) THIS INSTRUMENT WAS DRAFTED BY TAT T F HFRRTrV M1lNN9 & GDDDBICH .......... (NamA 55r ft Fridley, Minnesota 554 W r 1 A v Q O Q c a0 m E A ace: b �oz°'.� CQ rs ` 3 c b Y � �1 1• i V a ° i ov m a �h to y A� � 'es kw 13 .13 M b ❑ .��1 !, v Vtib °:tlo tl °ry i s i ° d m A Q o i .. � I v ba tl W �P 4 -D HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 12, 1980 PAGE 2 2. LARGE FAMILY HOME OWNERSHIP PROGRAM: A. Approve Demolition Contract for Removing Structure at 5832 University Ave. N.E. Mr. Boardman stated he would like the approval of the Authority to enter into a contract for demolition on the Johnson property at 5832 University Ave. N.E. The bids that came in were $2,100 by Boland Construction and $1,400 by Herbst Construction. He stated they advertised to try to sell the garage on that property, but did not receive any response, so the garage will be torn down also. MOTION by Mr. Prairie, seconded by Ms. Svendsen, to-approve the Contract for Demolition with Herbst Construction Co. for $1,400 for the structure demolition at 5832 University Ave. N.E., including both single family douse and garage. Upon a voice vote,.all voting aye, Vice - Chairperson Houck declared the motion carried unanimously. B. Update on Survey on 6025 - 3rd St. N.E. and 5932 University Ave.. N.E. Mr. Boardman stated they have gotten quotes on prices for surveying. The quotes were $600 from Suburban Engineering, $690 from Comstock & Davis, and a third quote for $900. He stated they have authorized Suburban Engineering to do the survey on the four lots. MOTION by Mr. Prairie, seconded by Ms. Svendsen, to approve the bid from Suburban Engineering of $600 to do the surveys on 6025 - 3rd St. N.E. and 5932 University Ave. N.E. Upon a voice vote, all voting aye, Vice- Chairperson Houck declared the motion carried unanimously. C. Approve Ordering of the Fridlev City Ca d Abstracts for the New Lots as Split to Lre for Sale of Lots Mr. Boardman stated he had written a memo, #80 -45, dated June 6, 1980, to the Authority asking for the approval of the Authority to order the updating of the abstracts on the HRA lots being acquired. Updated abstracts are required to complete the purchase agreements for the sale of the lots. The cost of the abstracts is $199. MOTION by Ms. Svendsen, seconded by Mr. Prairie, to approve the cost of $199 for updating the abstracts of the Large Family Home Ownership Program Lots. Upon a voice vote, all voting aye, Vice - Chairperson Houck declared the motion carried unanimously. D. Approve Wording of the Proposed Purchase Agreement and Second Mortgage to be Attached at Time of Sale Mr. Boardman stated they had Mr. Herrick put together some wording similar to the wording discussed at the last HRA meeting. Within the Purchase Agreement, it states they are going to be placing a 4 -E HOUSING & REDEVELOPMENT AUTHORITY MEETING, JUNE 12, 1980 PAGE 3 second mortgage on the property at 87. interest. That second mortgage is the difference between what the purchase price is and what the appraised price of that lot is prior to the time of sale. The wording also states that if the purchaser of that property moves out of the house within ten years,'the HRA has first right of refusal on the property, purchasing the property at the current appraised value minus the difference between the appraised value and the 87. interest, or they will foreclose on the second mortgage. The Mortgage Note is the second mortgage that is attached to the Purchase Agreement. If the purchaser stays in the house for the ten year period, then the principal and interest accumulated on the second.mortgage would AA be classified as satisfied. Mr. Boardman stated they sent the Purchase Agreement and the Mortgage Note to Dick Buddig, Legal Counsel for HUD, and he has no problems with the documents. MOTION by Mr. Prairie, seconded by Ms. Svendsen, to approve the wording of the proposed "Purchase Agreement" and "Mortgage Note" to be attached at time of sale. Upon a voice Note, all voting aye, Vice - Chairperson Houck declared the motion carried unanimously. E. Approve Appraisals on the Four New Lots to be Completed Mr. Boardman stated that, as stated in the Purchase Agreement, prior to the time they lay out the purchase agreements, they have to get appraised values done on the vacant piece of properties. He was asking for approval of these appraisals.from the Authority so that when they get ready to sell a property and write up a purchase agree- ment, they can go ahead and get an appraised value so they can put that appraised value within the purchase agreement. The appraisals cost approximately $175 each. MOTION by Ms. Svendseu, seconded by Mr. Prairie, to approve appraisals on the four new lots to be completed. Upon a voice vote, all voting aye, Vice - Chairperson Houck declared the motion carried unanimously. 3. UPDATE ON REHAB PROGRAM: Mr. Boardman stated that with the rehab program, they have been having problems getting contractors to do the.work. They have two projects with two bids, three projects with one bid, and one project with no bid. The City gives the property owners a list of contractors who are interested in the rehab program. The property owner is responsible for contacting those contractors and getting three bids. Mr. Boardman stated they feel they should move ahead with these projects. On those projects that have two bids, they will take the low bid. On the projects with only one bid, they are going to have Darrel Clark, Chief Building Official, go out, look at the one bid, and give notice of whether he thinks that bid is within reason. They have talked this over with HUD, and HUD has no problem with it. a- 0 Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley DATE: August 1, 1991 TO: William Burns, Executive Director of HRA FROM: Barbara Dacy, Community Development Director SUBJECT: Consideration of Housing Study Outline Background At the May 9, 1991, HRA meeting, the HRA considered the first draft of a housing study outline. Last winter Bill Burns and I interviewed other first ring suburbs to identify what opportunities there are for successful housing programs. As a result, one of our recommendations to the HRA suggested that the HRA conduct a housing study to identify the housing markets we should maximize or prioritize in order to complete successful housing redevelopment projects. At the May 9, 1991, meeting, the HRA stated that the outline needed to be more focused. Further, there was an indication from the HRA that the study should not simply be a demographic study, but should be completed in enough detail so the City could use it as a guide for its projects. Revised Outline Attached is the revised outline. The purpose of the study is to determine the opportunities for successful housing redevelopment projects in the City of Fridley and what tools, programs, or strategies are needed to maximize those opportunities. We used the housing study that Maxfield & Associates completed for the City of Brooklyn Center as a reference tool for the revised outline. The HRA should also be aware that the Association of Metropolitan Municipalities has issued policy statements regarding the need for housing studies. Attached are copies of the AMM policies on this issue. Specifically, the AMM recommends that cities "carefully look at the potential impacts these demographic trends might have 5 Consideration of Housing Study Outline August 1, 1991 Page 2 on their housing stock and become involved with all local and regional governments to successfully address the potential problems ". The demographic trends that this policy refers to are the trends that the Metropolitan Council has identified in several reports printed in the last two years. The trends the Metropolitan Council refer to include a low demand for existing rental stock, an aging housing stock in need of rehabilitation, a decreasing demand for new housing, loss of equity for homeowners, a change in household composition, and declining property base caused by decreased valuation from lower income rents and decreased property maintenance. Many of these issues are applicable to Fridley. Recommendation We will be meeting with Lee Maxfield and Maxfield & Associates prior to the HRA meeting on August 8, 1991. We may have minor adjustments to the outline. Also, we will have an estimated cost for the study. Pending resolution of the cost and specific outline details, we would like the HRA to authorize the Executive Director to enter into a contract with Maxfield & Associates to conduct a housing study. BD:ls M -91 -562 r ° 5 -A OUTLINE FOR HOUSING STUDY PURPOSE: To determine the opportunities for successful housing redevelopment projects in the City of Fridley and what tools, programs, or strategies are needed to maximize those opportunities. I. Identify current demographic and housing market trends affecting Fridley's housing supply and demand. A. Compile market and demographic trends external to the City of Fridley which influence the City's housing opportunities. 1. Define trends in metropolitan area on: a. rental market b. first time home buyer market C. move -up market d. empty nesters e. young seniors f. older seniors 2. Define statewide or national trends which affect Fridley. B. Compile demographic trends internal to the City of Fridley. 1. Employment 2. Age of housing 3. Type of housing 4. Building trends 5. Public school characteristics 6. Neighborhood demographic profiles 7. Income levels II. Define our "trade area" and analyze the housing market. A. Using as much local sales data as possible, analyze housing sale trends. B. Survey general occupancy apartments and analyze rental market trends. 1_111'1 5 -B OUTLINE FOR HOUSING STUDY Page 2 1. Cost per unit 2. Vacancy rate 3. Occupancy rate C. Assess condition of Fridley housing market through interviews with key stake holders in the Fridley housing market. 1. Large employers 2. Realtors 3. Rental managers 4. City of Fridley Section 8 housing representative 5. City Assessor 6. School District representatives 7. Local developers 8. Church representatives 9. Crime Watch block captains 10. Others as determined necessary III. Neighborhood Analysis A. For each neighborhood, define its characteristics in terms of the neighborhood's: 1. Vacant land a. size b. zoning C. developability 2. Location 3. Access /transportation services 4. Housing types and conditions 5. Positive images 6. Negative images a 5 -C OUTLINE FOR HOUSING STUDY Page 3 7. Resident /tenant demographics a. age b. income C. owner versus renter 8. Existing housing markets B. For each neighborhood, identify housing problems or opportunities and assess the impact on the neighborhood. 1. Identify problems (i.e., what was found in "A" above, poor conditions, etc.) 2. Identify opportunities (i.e., redevelopment, new construction, rehabilitation, etc. IV. Identify range of housing programs and financial opportunities available to address housing issues. A. Federal programs B. State programs C. Non - profit agencies D. Other communities V. Identify other strategies to maintain/ improve housing and neighborhood livability. A. Regular enforcement of building, fire, and zoning codes B. Methods of neighborhood participation C. Other VI. Match financial opportunities in IV above and other recommendations in V above to the problems and opportunities which exist in Fridley neighborhoods. Identify strategies to address problems and to maximize opportunities: A. Identify strategies for neighborhoods to be accomplished in the next five years. B. Identify strategies to be accomplished in the next ten years. C. Identify strategies to be accomplished in the next twenty years. VI. Conclusion and Summary of Recommendations 5 -D AAR &�� CITIES SHOULD BE1'ED 5_E T LEGISLATURE TO CONDUCT AND SUFFICIENT AUTHORITY THEIR INDIVIDUAL , gOQSZNG NEEDS. CE HOUSING PROGR"S BTgATTY BY MEET COCOGI�ION FEDERAL AND METROPOLITAN CAL FUNDS CAN MEET GOALS. AN RESOURCES N N USED TO �N THEY CAN IT IS NECESSARY To LOCAL LEVEL. THIS COULD INCLUDE: RESOURCES AVAILABLE _ AT THE VAL OF SOME OF � LIMITATIONS INCREMENT SOME FOR HOIISING ON T IISE OF TAX REMOVAL OF CITY AND HOUSING A ALLOW FOR SPECIAL IMPACT UTHORIq*y LEVY LIMITS SPECIAL LEWES FOR HOUSINGS REINSTATE THE STATE EXEMPTION FOR DEED USING THE PROPERTY AGENCIES MORTGAGE TRANSFER TAX INCOME HOUSING TAX SYSTEM TO PROVIDE INCENTIVES FOR A-7 HOUSING IN LOW � �TROPOLITAN AREA Rental housing which units in the metro makes up approximate) metropolitan re Y 35$ of pol3tan housing market. Traditionally plays an important the housing provided an affordable Traditionall P matt role in the Young married housing Y, rental units have families g option for singles, were low and moderate ' students and the Young adults, by the Metropolitan income households. elderly. Many of which ar -o like) have Council are show* Recent studies completed many ci ies , heroad impacts on the housin demographic changes that communities with: long term implications characteristics of could find many * a low d * errand for its exist' an aging housing stock �g rental stock * a deer in need of r * easing demand for new rehabilitation a loss of a housing * a deci ining�p= Pe'rtr homeowners Y base # a change income rents and decreased-property caused decreased valuation * a 9e in household composition maintenance w potential loss of a subsidized general slowing of t,p housinq stock 1*-, ?-- THE AM - _ ..y � ��, - s growth rate RECORDS IMPACTS THESE D THAT CITIES CARE ND INVOL�°G WITH C ADS MIG HAVE LOOK AT HOU POTENTIAL RECOGNIZE SUCCESSFULLY DHSS THE AND REGIONAL GOVERNMENTS S STOCK POTENTIAL LE1rLS . IT IS TO _V1 T ME7�tOPpLITAN NATUREoF TAE THAT . REQUIRE CITIESTp °T° THE Aw ADDRESS TO PROVIDE ORTS THE DIRECTION TN O TAN COUNCIL'S ADDRESSING THESE -24- TASK METROPO FORCE ESTABLISHED HOUSING .. 1 ( ISSUES. A -8 NEIGHBORHOOD LIVEABILITY Rapidly evolving social, demographic, economic and behavorial changes are converging on many cities creating new challenges that exceed their capacity to deal effectively with their new environments. The challenges cities face, such as deteriorating neighborhoods, crime, and drugs, need the cooperative efforts of public private and business interests to solve. Cities have expanded public safety, inspection, and health programs; have aggressively repaired and replaced infrastructure; ie., replaced streets and public utility lines; have removed diseased trees, redeveloped parks, refurbished or replaced neighborhood civic facilities; and have developed programs to assist low and moderate income families, yet problems continue to grow. Cities should take the lead in developing local and regional strategies that will assist them in dealing with growing neighborhood problems. These strategies should include the following major categories: 1. Physical and structural deterioration of the neighborhood. 2. Social welfare of the neighborhood. 3. Educational opportunities. PHYSICAL AND STRUCTURAL DETERIORATION OF THE NEIGHBORHOOD: a. Cities need to evaluate the demographic impact on their housing stock and plan for future rehabilitation or reuse. The demographic impacts may include declining home values, delayed or non - maintenance of housing stock, foreclosed or abandoned housing and the changing of neighborhood character (i.e. An owner base to a tenant base). In a metropolitan area these forces go beyond a city's boundary and may require a more metropolitan view to try to resolve the causes of the problems. b. Cities need to plan for continued upgrading of public facilities (i.e. streets, utilities, parks) even in the face of declining values. This may require statutory authority beyond existing authority. C. Cities need to plan for regulatory enforcement at levels needed to maintain neighborhood quality. If a strong level of enforcement is provided up front it can be an effective relatively low cost long term -25- 5 -F 5 -G strategy for maintaining neighborhood quality. d. Cities need to resident's Participat ono in d encourage neighborhood city s neighborhoods one of the strongest tools that of the that citiesrlcan cta become provided that other resources are in a into, provide the means by which this energy lace that can e- Cities need to can focus. for the expand their resource base long-term targeting of resources to accomplish Plan g' strategy for neighborhood P their Expanding this resource Preservations. coordinated efforts at the federal, and local level. state -require regional f- Cities need appropriate to strengthen their ability eliminate legal actions in a swift aertake neighborhood deteriorating structures to impacts Lengthy Procedures accelerate in a This should linclude structures have on a neighborhood. damaging court to allow for ac the expanding e housing 9 use of the housing and for City code enforcement single family dwellings 9- Cities need to resident's participatonoin recreational neighborhood activities. Along Pursuits and facilities for recreation tandtleisappropriate be organized , there needslto !� programs and activities to make the best use of these facilities. SOCIAL WELFARE OF NEIGHBORHOODS: a. Cities need to evaluate directly impact the those social issues that (aging, child care in a neighborhood domestic abusecare� transportation, job training, systems that etc.) and plan for neighborhoods. will and the liveabilityanof b. Cities need to welfare system come more familiar With y and work closely with state the social agencies to emphasize and count neighborhoods the need of stabilizing neighborhoods. and the family units within those c. Cities need to individuals and famll e9shen the cooperation of support city initiatives dealing the neighborhood to awareness, public health dsali g (i.e. garbage houses, -26- 5 -H HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 3 signals at East River Road and Highway 65. Is there a long range plan to illuminate all the major traffic intersections? Mr. Burns stated the long range plan is to provide the illuminated signs at all major intersections of the three major traffic arteries: East River Road, University Avenue, and Highway 65. Ms. Dacy stated the HRA expense would only be on University Avenue, because that is the plan that was authored and approved by the HRA. OTION by Mr. Prairie, seconded by Mr. Meyer, to authorize the expenditure of $40,000 for the improvement of two traffic intersections on University Avenue at 57th Avenue and 61st Avenue. These improvements will include: 1. Putting the signal poles in the medians rather than at the corners. 2. Upgrading and replacement of pedestrian signals. 3. Installing internally illuminated street signs. UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. Mr. Meyer asked if staff could get more information for the next meeting on the signal improvements. Mr. Burns agreed that more information is needed. 2. APPROVE HOUSING STUDY OUTLINE: Ms. Dacy stated that at the last HRA meeting, one of staff's recommendations from the interviews they did of other first ring suburbs was to look at conducting a housing study so that the HRA could identify what opportunities, there are for successful redevelopment projects in specific areas and what they need to do to maximize those opportunities with the programs that are available. Ms. Dacy stated the study that staff referred to was the Brooklyn Center study, and staff reviewed the Executive Summary of that study at the last meeting. Staff has prepared a detailed outline of the scope of the proposed housing study for the HRA's concurrence or recommendations. It was staff's understanding from the lasts meeting that the HRA did not have a preference as to the consultant, but they did want to review the scope of the study and the cost. 5 -1 HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 4 Ms. Dacy stated the Brooklyn Center study cost about $28,000. The same consulting firm has done a study for the City of Roseville which cost about $12,000- 15,000. The difference between the two studies is that the Brooklyn Center study was a neighborhood -by- neighborhood analysis, a very detailed approach. At this time, $25,000 is allocated in the HRA budget for a miscellaneous category for studies as needed. Staff would like them to see if they can accomplish the task in the outline for about $15,000 or less. Mr. Meyer stated $15,000 doesn't seem like very much considering all the things they want to accomplish with this outline. He did not want a consultant to take a lot of "boilerplate" information from other sources and put it into the study for $15,000. Is $15, 000 enough to do a study of the things they want or are they being general about so many long listed items that they are not hitting at the heart of what they really want to find out with a study? Ms. Dacy agreed that staff does not want some "boilerplate" data that is applied to Fridley. They want something that fits Fridley, and they want to know what the trade area is and what market they should be looking at and what area of the community they should be looking at for different kinds of housing. Ms. Schnabel stated that under "Analysis ", perhaps they are being too general, and maybe they should better define what they hope to achieve with this type of survey. What areas of housing are aging, and what types of things should they be looking at for upgrading those areas? Should they be encouraging total redevelopment, or is the housing salvageable? Mr. Burns stated he believed they are trying to take a look at the different economic environments in which Fridley exists -- state, regional, and local environments. They want to look at the opportunities and threats, the demographic trends, and other things their economic environments tend to point to, and then, based on those opportunities, determine the opportunities and threats they see in their environment and how they can best make use of the tools that are available tc the HRA to address the housing needs in Fridley. Those tools include redevelopment, scattered site housing, housing rehabilitation programs, etc. Mr. Burns stated they know some of the sites they want to redevelop. Why not do a site specific research study? This outline does not necessarily exclude that, and that could be done. 5 -J 11- � HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE 5 Mr. Prairie asked if cities share studies with other cities. He would think some studies from neighboring cities would be helpful. Ms. Dacy stated they do have a lot of base data available already. The study will get more specific and get at some of the issues of the local market and how the regional sales affect the Fridley trade area. Ms. Schnabel stated her neighborhood is 25 years old. It is not deteriorating, but it is aging. There are neighborhoods that are a lot older and are deteriorating more. It is her feeling that these older, deteriorating neighborhoods are the ones they should try to save or help to preserve these areas from deterioration. Mr. Herrick stated there are two concepts: redeveloping an older neighborhood, and individual home upgrading. He thought the latter is more realistic. He stated that the Robbinsdale HRA has had a scattered home rehabilitation program for 20 -25 years. If that is one of the things the HRA has in mind, they should contact the City of Robbinsdale for more information. Ms. Dacy stated that is the issue: What tool do they use and what program do they use where? Mr. Burns stated it is more than just using housing incentive programs. The Brooklyn Center study recommends establishing neighborhood organizations, to establish networking, and to use housing inspection and fire inspection and policing programs to create the conditions that protect housing. So, it is more than just focusing on housing. The Brooklyn Center study also shows there are some inappropriate uses. The study would also be aimed at inappropriate land uses as well. Ms. Dacy stated that, regarding Mr. Meyer's concerns about where specifically they should be focusing their redevelopment efforts, III.B under "Analysis" could probably be better stated. Mr. Meyer stated the two items under III.B, "Identify Fridley neighborhoods, and identify strong and weak neighborhoods" are very important. Numbers A and B under IV. Implementation, are very good also. There just seems to be too much generalization, and $15,000- 20,000 will not give them too much. He would like them to have a firm idea of what they want the study to do and the specifics and then appropriate the necessary money to do that kind of study. Mr. McFarland stated he thought they should take a more comprehensive approach so they do not run the risk of having conflicts after all the information is brought together. 5 -K HOUSING & REDEVELOPMENT AUTHORITY MEETING, MAY 9, 1991 PAGE _6 Staff should work with the consultant to tailor the program to the cost and yet try to get all the benefits they are looking for at the same time. Mr. Meyer stated they should put enough money into the study to give themselves a proper tool that they can do something with, and then do something. Ms. Schnabel agreed. She stated her concern is that they not get a study that is too generalized that they cannot really use. Ms. Dacy stated staff will come back to the June HRA meeting with a more detailed, specific outline. Mr. Burns stated that, between now and the next meeting, staff will work at developing a more focused approach with Maxfield & Associates. 3. CONSIDERATION OF APPROVAL OF EXPENDITURES FOR SHOREWOOD PLAZA REPLAT• Ms. Dacy stated that after the approval of the Shorewood Plaza Plat, the City determined that the plat drawing indicated the wrong street radii in order to conform to the Municipal State Aid street standards. While the road was constructed according to MSA standards, the plat was drawn incorrectly. Complicating this further, the developer could not record the original 1988 plat because of the various description and title difficulties pertaining to the property. The City did a special Surveyor's Certificate of Correction in 1988 which enabled the developer to record the plat. At this time, they have to correct this situation. Ms. Dacy stated the City's share of the cost for replatting this area is between $2,000- 3,000. The HRA's responsibility would be $400 -600. Staff is recommending the HRA authorize the expenditure of no more than $600 toward the replatting costs of Shorewood Plaza. MOTION by Mr. Meyer, seconded by Mr. Prairie, to authorize the expenditure of no more than $600 toward the replatting costs of Shorewood Plaza. UPON A VOICE VOTE, ALL VOTING AYE, VICE - CHAIRPERSON SCHNABEL DECLARED THE MOTION CARRIED UNANIMOUSLY. 4. CLAIMS AND EXPENSES: MOTION by Mr. Meyer, seconded by Mr. McFarland, to approve the expenditures of $1,812.60 and $83.55 to Natural Green', Inc., for Lake Pointe maintenance; $3,756.58 to Greenmasters, ,%;l 1 111� ' NOBLE NURSERY INC. 10530 Troy Lane Maple Grove, MN 55369 NOBLE NUWQY Phone: 420 -3797 An Equal Opportunity Employer SOLD TO SHIP TO City of Fridley 6431 Universit 1 venue E. Fridley. Hinges to 5 432 Attention: Joh Th m son YOUR ORDER NO O R O DER INVOICE NUMBER 1940 DATE _ Jul 23. 1991 CUSTOMER NO. NO. D E SHIP D S I PED VIA FOB TERMS i QUANTITY QUANTITY UNIT ITEM ORDERED QUANTITY SHIPPED PRICE AMOUNT IRRIGATION STwith PA R Rot Heads 5 22.00 $110.00 Pop up Spra ozz e 1 5.50 5.50 sers 5 1.25 6.25 SUBTOTAL $121.75 6 5% Sales x 7.91 1 $129.66 La 5 45.00 225.00 TOTAL DUE: $354.66 C` THANK YOU FOR YOUR ORDER DATE TOTAL 07 -23 -91 DUE $354.66 DATE 08/02/91 CITY OF FRIDLEY - HRA PACE 1 PROGRAM M. CHECK REGISTER 6 -A CHECK RUN BATCH # :(*07 002 HRA VENDOR DISC. JOB IESC-RIPTION INV # PO /INV # SEQ # PCNT A11UNT ACCT NtMER NMF.R MESSWES I 2146 ffff CHECK- PREPAIIt C00044 MME RI..Y LAW OFFICi &LY LEGAL SERVICES 00440 -01 I94,'0GX0.00CKt 1, 7551. 00 TIi4`5 -20M, ACt NTS PAYABLE 1, 75 ,'.CMG CR41,6 -10100 CAM JULY LEGAL SERVICES 0044(K12 triKOW0.00M 472.511 iR460 -20200 Ai UMS PAYABLE 472.50 CR460- 10100 CASH JLLY LEGAL SERVICES 0044(1 -03 D9K0Qti0.0000 2,CKt2.00 IR46& -20200 ACCOI-I1NTS PAYABLE 2,002.00 CR460 -10100 CA%l H-** TOTAL VENDOR 1s 4, 2119.50 2147 WE MI CK -Pf -PAID Hr M1023 FRIDLEY, CITY OF JLLY EXPENSF (10441 -07 DiK 000.0000 13237.00 Mfd) -20200 FCCOL4VTS PAYARF 13 237.00 CR450 -10100 CASH JkLY EXPENSE 00441 -08 INK00F0.0000 :.'5.79 DR450 -20200 ACMINTS PAYABLE 25.79 C.R450 -10100 MIM JULY EXPENSE CKt441 -09 D9K0k10.0000 121.75 DR450• -20200 ACCOMTS PAYABLE- 121.75 CR45CF 101(Kl CASH JULY EXPENSE 00441 -10 MOW. 6160 DR4W- 20°00 ACCOIJINTS PAYABLE- ,Q.60 CV45 0- 101(K, CASH JULY EXPENSE W441 -11 OWOSO.(KKK) 2, MRS. W DR451 -2000 ACxOUWTS PAYABLE 2,78,.00 CR451 -10100 CASH JULY EXPENSE 00441 -12 DrUP10.0000 122.00 IR455- 110200 A(UdJNTS PAYABLE 722. CKt CR476 -10100 CASH JLLY EXPENSE 00441 -13 D94K0040.00(K1 43.18 DR45- :.'0200 ACCOUNTS PAYABLE 43.18 CR455 -10100 CASH JULY PERSONAi. SERVICES 00441 -01 WCUS0.OW 13,3A0.,33 DR460- 20110 ACCOUNTS PAYABLE 13, 50.22 CR460 -10100 CASH JULY EXPENSE W441--03 DW011W0.(00 24.84 MW-202W ACCOILWS PAYABLE 24.84 CR460 -10100 CK-M JULY EXPESES (0141 -02 D9 OW0. 0000 190.08 DR460 -202W ACC3'd -Qq S PAYABLE 190.0,13 CR460 -10100 CASH - JLLY EXPENSE 00441 -04 I19KOR:330.OWO 21.97 DR46CH201M) ACCX:d1NTS PAYAE+LE 21.97 CR460- 101CKt CASH JULY EXPENSE 00441 -05 D9WOR70. OCKx.') 9, 719. () DR460 -202) ACCOUNTS PAYABLE 9,719.00 CR460- 10100 CA;4; JLLY EXPENSE 00441 -06 D9Y•OW.0(KKt C.W DR460- 201200 A1:UILINTS PAYABLE 32. (K! CR460 -10100 -X-*ttf TOTAL VENDOR *1:** 40,349.54 2148 Ham* CHECK - PREPAID F** C ,(K1069 GREMMASTERS, INC TREE. AND STUMP REMOVAL 610551,9 00442•-Cl1 119.K0C1CO.0000 2,1:25.00 1lR4` ,- X0200 ACCEILI VS PAYABLE 2, SM. 00 CR455-101(K► CASH *kt* TOTAL VENDOR ***-K- $ 2, 32'5.00 2149 ## CHECK- PREPAIDt G00069 GREFNMASTERS, -INC LAKE POINI E EST #4 00443- 01 U99KOC1F0. OCK10 3,771.59 FIR455 -20 00 ACCOUNT" VAYA)+LF 3,171.59 C:R455 -10100 CA13,111 # TOTAL VENDOR d * #g- a 3,771.59 DATE 1-r.; /U2 /`z'1 CITY (IF FRID EY - HRA PAGE - PROGRAM POOR CHECK 8031:; 03 6 'B i=HED RUN BA1CH # :0007 CK12 WA VENDOR DISC. JOB fasoRIPiION INV # PO /INV # SECS # PCNT AMOUNT ' ACCT NUMBER NM(R MESSAGES 2150# CHECX,--PREPAIIO HOW19 ''HERRICK & NEWMAN JULY LEGAL SERVICES (20444 -01 10k:OWl.(WO 1,246.50 IR450- 20.°(2) ACCOUNTS PAYABLE 1,246.50 CR450-101() CASH TOTAL VENIOR ffff 1,246.50 2151 CHECK- PirEPAID *H* IOW06 INIOI:PFNI.ENTl rSCH. 1lISTR. NCO. 14 1ST HALF LEVY PhT. CK0445 -01 I .'CIEO.CKKKI 112,543.55 FR460- -2021W ACXCQNTS PAYABLE 112,543.55 CR460- 101CKi CASH TOTAL VENDOR $ 112, 543.55 2152 C4ECK- PREPAID * I00011 INIC- FIXENT K:H. DISTRICT #11 1ST HALF LEVY PMT (20446 -01 I0b:ORHO. OCKKO 7,9.216.46 IOk460- 20.200 ACMWI S PAYx1ELE 7,926.46 CR46 -10100 CASH TOTAL VENDOR 7,926.46 2153 0 0 015C K PWAID **** IO(K)13 INDHWENT ECH. OISTkICT #13 iST HALF LEVY PMT CK+447 -01 IK(MO.(1000 14,£026.19 IR460 -20200 ACCC0UNT5 PAYABLE ,�W7° 14,826.19 CR460- 101(00 CASH TOTAL VENIXR I-W 14,826.19 2154 f�* C1fECK -PRE -PAID *H-* 100016 INDIEPENDENT SCH. I+ISI #16 1 tiT HALF LEVY PMT 00448 -01 IKOR O. WOO 29, 1RO7. `8 LR460- .'0;22! ACCCCOKI S PAYABLE 29,1-407.58 CR460 -10100 C!1m > TOTAL VR 0 8 29,807.58 •' TOTAL NUK0 OF C#IECE:S WRITTEN : 000000 **** TOTAL DOLLARS FOR CIECKS WkIT1EN 217,025.91 LAST CJIECK NCMU. , ; (KK043! �1 PAGE 1 6-C JC►N NMtR 101W-01 ACxi WTS PAYAJ-LF CASH INVESTMrKTS, AT COST CASH AC UUNTS PAYABLE CASH ACCOOUNCS PAYABLE CASH ACCOLWTS FAYABLIE CASH ACI'(kWTS PAYABLE CASH AXEILINTS PAYABLE CASH ACf :OLlNl1; PAYABI F Ck-;H ACCLIL9VTS PAYAF4_E CXl ACCOUNTS' PAYA=BLE CASH ACClXWTS PAYABLE CASH ACC? 4 NTL PAYABLE CAf4-1 AIXULINTS PAYAII E CASH ACCOUNTS PAYABLE CASH A0 'C�OL►NTS PAYABLE CASH ACCOUNTS* PAYABLE CASH Ar:COt dTS PAYABLE CW;H ,l-� DATE 01/19/91 CITY OF FRIDLEY - HRA PROGRAM FQ08 (itECK REGISTER CHED, RUN BATCH # :O(K►6 002 HRA %M(R DIfE:. DESCRIPTION INV # PO/ INV # SF-@ # PCNT AMOUNT ACCT NIMBER 2136 C HF.CX- PRFPAIIi fif* P(KK029 PATCHIN & ASSOCIATES INC. APPRAISAL FFES 9116 00430-01 M900.0(KK) 5,70K1.00 1►R455 -20200 5,100.00 CR45510100 { TOTAL VENOO;R f 517(k). (1) 2137 ffff CHECX- PREPAID + f# F00026 FRIDLEY STATE W.M; INVESTMENT 00431 -01 B09CJ0.0000 1,417,0110.00 DR101- 1040() 1,417,000.(K) CR701 -10100 f. OTAL VENDOR 1 1, 411, O(K). 00 2138 DiECK- PREPAID fff# C00044 C.ASSEKY LAW (4FICF JUNE LEGAL SERVICFS (N22 Ol 1i9'i:'O.00KK) 202 -SO IR450- 202KK► 202.50 CR450 -10100 &INE LEGAL SERVICES 00432 -02 8050-9P0.0000 427.50 DR45:i- 210200 427.50 C:H4`iE,- 101CK) a$E LEGAL SERVICES 004,2 --03 W,9IN 0,0000 112.50 DR457-:?CQO0 112.50 CR45;-10100 &1NE LEGAL SERVICES 0043' -04 B159390. (WO 9.25 IR460- 2020(( 9.25 CR460- 10100 JRJNE LEGAL SERVICES 004 -KI -05 &IO.(KK)0 2,311.45 UR460- 202V) 2,311.4: CR460- 101(1) ¢ TOTAL VENDCR 3,063.210 210 sue* (lECX'- -PREPAI1t FOC(172 FIRST TRLGT BOND PAYMENT SEk 90 00432 -01 MrdX0. WK) 324, .`65.00 DR20 {..2'0,''00 324,565.00 CR: i- 101Ox) for, TOTAL VEXIOR *"K- .3`'4,565.00 21401 xr ax _l1C_!% - C4cCi/1TII Lf�# F0002a FRIDLEY, CITY OF --HJNE OPERATING EXPENSE 00434 -07 81 : ?60.0010 246.17 10R4:d►- 202(K) 246.17 CR450- 1(0100 ,-4� OPERATIWi EXPENSE (10434 -08 F099D O.0(* 0 26. 71 Im4`4)- 2%)2(0 26.71 CR4,W 10100 JLW. OPERATING, EXPENSE 00434 -09 BK599H0.WOO 63.60 DR4`d0- 20?(K► K4.60 CkW -10100 ,tJNE OPERATING EXPENK 00434 -10 81699K0.W(K) 45.00 IR4.`_A{>--202{010 45.00 CR4`,0-- 101(00 &INE OPERATIWi EXPENSE 00434-11 M99XO. (KKK) 9.96 9.96 Ck4` &•10100 ,.ate OPERATING EXPENSE 00434 -02 ► i9RLO, (x1(1) 3. (K) IR460- 2'02110 3.00 C'R460 -1010 0 &VE PERSONAL SERVICES (10434 --01 t 9BXO.(►U00 13,%0, 3.G, DR460- 202(9 13, 360.32: CR46( -lO1 CK0 JUNE OPERATIFpI EXPENSE 00434 -03 B169C10.OWO 2, 315.00 DR460- •202110 2,375.00 CR460- 101(10 &K OPERATING EXPEW-E 00434 -04 BW59C-80, (KKK) 8.40 IR460- ,N)i"00 8.40 (8460-1010G PAGE 1 6-C JC►N NMtR 101W-01 ACxi WTS PAYAJ-LF CASH INVESTMrKTS, AT COST CASH AC UUNTS PAYABLE CASH ACCOOUNCS PAYABLE CASH ACCOLWTS FAYABLIE CASH ACI'(kWTS PAYABLE CASH AXEILINTS PAYABLE CASH ACf :OLlNl1; PAYABI F Ck-;H ACCLIL9VTS PAYAF4_E CXl ACCOUNTS' PAYA=BLE CASH ACClXWTS PAYABLE CASH ACC? 4 NTL PAYABLE CAf4-1 AIXULINTS PAYAII E CASH ACCOUNTS PAYABLE CASH A0 'C�OL►NTS PAYABLE CASH ACCOUNTS* PAYABLE CASH Ar:COt dTS PAYABLE CW;H ,l-� [ATE, 07 119191 CITY OF FRIDI.EY - 7M PAGE 2 PPOGRAM PCB C&CK REGISTER 6-0 CHECK: RL1N BATCH # :0006 M2 MA 'BEND -tR DISC. L DEKRIPTION INV # PO /INV # SEQ # PCNT AMOLK ACCT NLMMFER NtifR MEa;AC4=5 JIVE OPERATING EXPENSE 00434 -05 BW59CICO.0000 3{.66 IR460 -20200 ACCOUNTS PAYABU 33.66 CR460•10100 M I l q1< OPERATING EXPEL 004.14-•06 BW59Cr0. (K-O 10.110 DR460- 210:110 AC COLINTS PAYABLE 10.80 CAM60- 10100 CA.W TOTAL VENDOR #tee 3 16,132.63 2141 *ft ClIEiY- PREPAID 000069 C,1;EENMASTERS, INC LAKE POINTE MAINT PROJ ES 00455 -01 BW59010.0000 3,756.57 M4i55 -20X)O AC- COUNTS PAYABLE 3,756.57 CR455 -1010 C:A.S1 '�+► TOTAL VENDOR uff s 3, 756.57 2142 CHECK- PREPAID # H0O19 HERRICK & NEWMAN ME LEGAL CERVICES 0436 -01 IW9910.0(Kb 4`;9.(10 1.64`O -:0200 ACUUNTS PAYAPdF 459.00 (8440 -1010 GA`f4 ,4INE LEGAL SERVICES 00436 -02 W.K40.0(X)0 46.1; IR4650 -2020 ; CCOIXTS PAYABLE 46.7; CF460 -1010 CASH ¢c-*,c- TOTAL VENDOR f 305.75 2143 CHECK PREPAID NOr1026 NAIIUAL C�EN, INC. % F POINTE-•IRkIGATION SE 54030 0437 -01 F�9A40.(KJC 199.75 LR455 -:1 AC(Cd_NVT. ^. PAYABLE 19`x.75 CR4595 -•1010 CK)H TOTAL VENDOR s 199.75 2144 CHECK -PREI °AID -K-** • N000,95 NATIONN. CITY INK OF MPLS. BOND PAYMENT 00433 -01 M918-K). 00(;0 117,251.25 DR2*0- 202(10 AMIMTS PAYABLE 111,251.25 CRIM•-10100 C:A9 1 MENT FEE 0438-•02 M. 9%0. 334.13 DRt;0 -- 20['00 - .CO'.lNTS AYABLE 334.13 CR Vo -1010 CAM - t #� TOTAL VENDOR s 117,585.4:3 2145 COCK- PREPAIO *"* P00094 POPHAM, HAIK, SCTf IBRICH, PROFESSIONAL CERVICES (104,W-OI BW5.5910.00 6.' 4.04 M!Z -2020 ACU-LWIS PAYAFU 634.04 C 1455 -10100 C:1:41 +- TOTAL VD-d1f s 6:34.04 f TOTAL NLflfER OF C+FCKS WRITTEN : (KKK-OO * {** IOIAL D(ILLARS FOR CHECKS WRITTEN : $ I M9,192.37 * *f* LAST CHECK NLMIIFR : O02135 F � 6 -E TO: FRIDLEY H.R.A. FROM: CITY OF FRIDLEY RE: BILLING FOR OPERATING EXPENSES FOR JUNE, 1991 AND JUNE 1991 ADMINISTRATIVE EXPENSES. June Administrative Personal Services 13,108.08 June Administrative Overhead 252.25 Total Administrative Billing OPERATING EXPENSES: Half Section Map 1990 Audit Lunch Postage — TC- � PM Delivery Services June Management Fee - Kordiak Realty - Rice Plaza Electricity - Rice Plaza Mowing - Rice Plaza Snow Shoveling - Rice Plaza Electricity - Lake Pointe Total Operating Expenses for June TOTAL EXPENDITURES 13.360.33 3.00 2,375.00 8.40 3 3.6 6-4 -7 10.80 246.17 26.71 63.60 -45.00 9.96 2,822.30 $ 16,182.63 1 TO: FRIDLEY H.R.A. FROM: CITY OF FRIDLEY RE: BILLING FOR OPERATING EXPENSES FOR JULY, 1991 AND JULY 1991 ADMINISTRATIVE EXPENSES JULY ADMINISTRATIVE PERSONAL SERVICES 13,108.08 JULY ADMINISTRATIVE OVERHEAD 252.25 TOTAL ADMINISTRATIVE BILLING 13,360.33 OPERATING EXPENSES: ADVERTISING - TIF PLAN 190.08 POSTAGE 24.84 SUBSCRIPTION - CORPORATE REPORT 21.97 INSURANCE ALLOCATION 26,466.00 BUILDING SUPERVISION 32.00 ELECTRICITY - RICE PLAZA 25.79 UTILITY BILLING - RICE PLAZA 121.75 MOWING - RICE PLAZA 63.60 ELECTRICITY - LAKE POINTE 43.18 TOTAL OPERATING EXPENSES FOR JULY $26,989.21 TOTAL EXPENDITURES $40,349.54 6 -F s r R 1 Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley TO: Housing and Redevelopment Authority Members J AV FROM: William W. Burns, Executive Director of HRA �. DATE: July 31, 1991 SUBJECT: School District Referendum Levy Returns _ z At our meeting on Thursday, August 8, 1991, we would like to discuss informally with you the 1992 TIF return to the four school districts. I have divided my comments into several sections: y: _ :o• II'Y In the packet you received for the June 27, 1991, meeting the Finance Department included a memorandum describing estimated 1991 and 1992 TIF money that the HRA could turn back to the four school districts. The Finance Department is now estimating that for 1991, the total amount before delinquents will be $330,207.52. This amount will increase by 14 percent in 1992, to $376,061. The amount has increased due to additional tax revenues from the Northwest Racquet, Swim and Health Club. As Rick Pribyl pointed out earlier, the amount of increase varies from school district to school district. The 1991 =d 1992 estimated TIF return amounts are contained in Table 1. TABLE 1 ESTIMATED AMOUNTS THAT COULD BE RETURNED TO THE SCHOOL DISTRICTS r� Percentage School Estimated Estimated Increase/ District 1991 Amounts 1992 Amounts (Decrease) 11 $ 15,852.91 $ 17,876.25 13% 13 $ 29,652.37 $ 26,877.31 ( 9 %) 14 $225,087.09 $271,516.41 21% 16 $ 59,615.15 $ 59,791.14 0% r� Memo to HRA July 31, 1991 Page Two At an earlier meeting, you were given a copy of a document dated January 17, 1991, entitled "Tax Increment Financing Revenue Projections." Page 8 of that document provided a projection of HRA revenues and expenditures through the year 2011. In preparation for our TIF turnback discussion, I asked Rick Pribyl and Paul Hansen to update__that information. Their update is contained in As we prepare to discuss the return of tax increment revenue to the four school districts, it seems appropriate to discuss this in the context of future project costs. In order to address future project costs and their im act P 7: ct p , i ave deveTopeL_th��_ crif��r�nt i•�ena -r -ion In (Appendix B —A ^*D- _pr- o3 s -: Lake Pointe, the Southwest Quadrant, University Avenue Gateway Project, and the Mochinski Project. I also assumed that we will finance the $10 million over deb�serYice n mount _af - . a- r- -- - 1 II7 -9 000 per ye: At the same time, I a- that we will derive $919,000 in captured increment from the four projects. The net annual cost that is determined by subtracting captured increment from annual debt service is a neaa ive�51:6D.00 _ The q-eq"p) sce ar 9� (A endix C) assumes that our costs for the four projects will be $14 5 -mi _,or. This includes $7 million for Lake Pointe, $4 million for the Southwest Quadrant, $3.1 million for the University Avenue Gateway Project, and $400,000 for the Mochinski Project. At the same time, I assumed the same captured increment as in Scenario 1. Increase in debt-- service cost, however, will leave us with a negative.. _cast -af Theme th rd-- scenar -iu ` or worsts �e-scenario---,) (Appendix D) assumes that we will issue $TO- miiiib _in additional debt, and that there will be _captured from any of the four projects. I also assumed, as I did in Scenarios 1 and 2, that there will be no offsetting revenue derived from the sale of the land. The worst case scenario would have us funding an additional $1,079,000 per year. 7 -�► rl"� VIII- mi- l- l- ianVfo� n Memo to HRA July 31, 1991 Page Three Although there are some negative annual balances derived from using the worst case scenario, they do not begin to appear until the year 2001. Even in those cases, there would be sufficient accumulated balance to govern the worst case scenario. While I may not have identified all possible projects, it seems safe to say from the data available in the three scenarios, we can turn back TIF revenues to the school districts without jeopardizing our ability to fund future projects. IV. SCHOOL DISTRICT NEEDS I have spoken recently to both Dennis Rens, Superintendent of Fridley Public Schools, and David Shapley, Director of Finance and Personnel for Fridley Public Schools. While the tax increment return money is not particularly critical to the HRA's future project needs, it is very important to the school districts. It was pointed out that the 1991 and 1992 increase in state aid for school systems is only 3.8 percent. The increase is reduced to .7 percent for the 1993 biennium. Moreover, School District 14 is projecting that annual expenditures will exceed annual revenues for the next three bienniums. For the 1991 -1992 biennium, the annual deficit is projected at $352,238. During the 1992 -1993 biennium, the deficit is expected to grow to $588,271. In the 1993 -1994 biennium, not only will the annual expenditures exceed annual revenues by more than $800,000, but needs of the school system will exceed both annual revenue and fund balances available by more than $157,000. Moreover, the state legislature has mandated that there will be no school district referendum levies in 1991, and in the event a levy is put on a ballot in 1992, it will not be until 1993 or 1994 that the school would realize revenue from the new levies. V. HRA LOSSES FROM CLASS RATE CHANGES During the 1991 legislative session, the Governor and legislature proceeded to reduce the class rate for multi - family residential property, as well as commercial/ industrial property. In 1992, the multi - family class rate will be reduced from 3 percent to 2.8 percent. The commercial /industrial class rate will be reduced in 1992 from 4.95 percent to 4.75 percent. (See Appendix E.) There has also been a trend in recent years toward some revision of property taxes for certain classes of property. We may expect further revisions in future years. At this point, however, it would appear that these changes in the class rate and revisions in our property taxes for particular properties will not have a serious impact on our ability to pay our debt service costs. r= 7-C Memo to HRA July 31, 1991 r '� Page Four No doubt in the future, we will want to keep a close eye on class rates and property appreciation or depreciation, and adjust our policies accordingly. We may even want to discontinue the TIF returns to the school districts altogether based on class rate changes and property appreciation. At the present time, however, it appears that this is not necessary. VI. RECOMMENDATION This is a tough issue that has risen for the second time this year. Both the school districts and the HRA can argue that either side has windfall profits that neither realized at the time the levy was passed or the tax increment district was set up. My personal feeling is that in general, there seems to be no conclusive evidence that either of these arguments is valid. What does seem to be important to me is that tax increment financing is, at best, a necessary evil that enables us to compete for economic development and to accomplish economic redevelopment that might not otherwise happen. If we accept this view, it would seem to follow that when we do not have a clear need for tax increment revenue, we should seriously consider decertifying districts and /or turning back revenue to the school districts from which the tax increment was denied. In this case, we are given legal discretion in turning back or not turning back revenue that was generated as a result of levies that were approved between 1979 and 1988. Under the "necessary evil" philosophy, we should exercise our discretion and return the money. T -vi-ew that -irr the absence of strong argon s ong p tbiic appeal, - rte ©fit ta� support = _ �� school-- s- ys�em� -::� WWB:rsc Attachments / O Z �0 W a Q CL M W m (a m m^ 4 W EO O ai a m l0 l7 lh CmO / 0 N O Q O N N 1� O C M0 dap to app a imp T T T P T P T P N P T T T P T T T �P�yy N TN to A M M N c0 N C4 N 1aq 10 O IC 1 t N P N a O N P T T T T P P T P N N N N N N N N T T O >:•:::::�: m m m O m m m m O O O m m m m m m gg ryry T T T T T P P T P P P P to 10 Go 8fmm3iavvvaavvvvvvavvav_� N N N ;Sao N N a N - - - TTTT��TTT m -9 NLei.p�{ apima1p� �:�mp��py o��ap��0{ui.�= p.�{ArNi�:�g N a gi N N co N t+J � Q a�0 V Y 1TA W mT � N b ai M M al of of M of ai a1 al of ai ai ai M M ai N N P � oaaaaa�a Co N m W M a GaD P aNm amO 9 .t O m �Pp CPA day {ap N M T T T T T T T P T T P Co ICI apmm�m &am�:��.�� Opmppp pappOp CO im�pp capp0p em�pp ca�p0p im�pp ca�p0p papp0p pappDp �a�p0p . O CO OD Cm0 CO EO EO OD EO EO EO a0 a0 T T APPENDIX A id 2 O m c o m e U � T• a. oo pp m � � APPENDIX A id 2 O 7 -D s U � T• m � � � L L Cl C N Lq O E CD m In m E 0 cc m mD C z m O O _cis r r N O ~ !{t «O 7 C m L 7 o CM r= Lo V m O O O C j N C Cu p U O j p p cc C m C° to o N E L C r cc �jj C 7 V1 a m C O r c"0 m O Lq CD « x �0 N «L p C o U) m Ca C m h m 12 r �� o j C C m 7 a Y C C c. m e m `° o f m p 7 V O Q � C U L > 3 L V O _� D 3 O cry0 O C m V Y Y j C V g « C w c UU A _p ~ `� O p C C N C O` C H O l0 .Lm.. Cl. d L O E D m I m To Cm a « LOL F- r N @7 li ui tC 7 -D r{�y:i:��:: N 00f .r�}} � r � N 4 � I �O N ID EN(�O CD (fl N O O 2:f: ' y %: d: CO 4 N r O CD N V r CO � C00- � N rz CI r r CA r C7 r CO O pp�� N N CD N CO r tp r IA 9 CO N Of 0 :: N r CO CO CO 0 t0 CO C0 d: ' t M f� N 1� O ^ U) CCD N N M In O Or N O O '�MCON DOrNIV NCDCDOON Mst �CDco0 a N N N N N M M ar, cm ft I C07 " 1% COO ' tp It N CO CY 1NN� CND CO N O (� pM N N Cl) CD Of CON N �/ M N N Ch C: • C7 N O r to r O T O r 1t O M- ii:;' 1!:... N N N^^ N N N N N N N N M d el 0f . CD r CD r r r t� C�pp O O th CD r CO N N N lA O 01 Co O N N Cl) dr- r co '' N N N r r r r r r r N N N N N N N r r ... _. p � ? O C� CN C� ' N N CD 0 0 0 0 0 0 0 0 0 0 0 0 0 0 CD 0 T r r T T r r T r r r r r T r r r NWItV co cc 0 It Cqt co co CO3 0 0) 0) '.. r CA CO CO CO N N N pt p r c to CA to 0 Of 0 CO 0 0 r ��'' C�72 aa�o CD CD CD CD CO M CD M CO CO M m 01 N CV O 1t M It O 'fit O Mct9 0 M 0 0 COD COD O COD Q O O O CD CO CD Ci I(; ' M N N N N N N N CTO CNO CTO CTO tN0 CTO O CO r Cry N 01 M Of CO N C7 N CO N oN N CO Q� %:+.. In CO 0 co r O M CO CD CD 0 c�i "! ^ CNO t�0 N N N N N M N M M qt N m It p yq CO C7 M cl C9 C9 C!j C7 Ch cl M Ch CO) C0 Ch M CO N N r r co L CO fn CO U) Of � CO CO M CO C7 11) I� O N co) N co atLf� 1C+�� O Cfl r CO Nr CD tO� to � O CAA} ": N C� C•) tt Yrf tp CO f� CD 00f N N Ch qT � � CO ,a Go Q at � Iq L g ::Swc: C7 O M Of CA O N CO) M N N T r r C.4 CLQ R lff a) N CD 0D CD co CD C�pp CD CD CD 00 CD 00 N O CD CD CD CO CD CD tD CD CO CD CO CD :....: to .�t Of Of tp O CNO- N n - oof 00f O�i $ 0of COO C0 CO M C9 C7 07 Ch C7 C7 C7 Z r r r r r r r r r U) N to to U) Lq N N N Iq rl r r T r T .L 0 0 0 0 0 N O tC� IA O O O 0 N to 0 CO 11 CfJ CA M at IV st M LO CO CO N WC.� to T t —� try try — t— Cry try t— try O N N M � (D CO 0000 lh lh M c? ch c? c? (0 co co CO pp CD f� CO N f\ f` h f\ Q O Of O O O CO CO CO CO CO CO CO CO CO M r T N N N N N N 1_ r� N CSI CV CV N CV CV CV CV CSI N CV CSI CV CV CV CV r r M(D 0 LO Cp h CO 0 O r N 1Cp p� m 01 0 0 0 0 0 0 0 0 0 Q O Q O 0 CD 0 0 0 Off 0 CA Of O O O CO CCCCC C N N N N N N N N N N N } APPENDIX B 7 -E 1 I 1 .6 C O .0 a 0 s tff l0 � �A Lq ttl L E T « E m v 0 o c C Cd CD m 'C V O C � tD O O CD O O � O r V Co yt. = a g N E N U 2 tD O O -- C w N Ccu ia Qu .92 O O � Y m U 0 c c c Cd c `o cc V1 .- y .G E c O S N _� X CCI N C c N cis Q7 O M C 0 cm c C CCl ., m V c O p m cc p7 N O C Cctf m C C E cc ld > > c .0 m E A C l0 U r 0 3 t > i m0 i0 O � U r Y 7 p m N CO O c 0 N C .O O C c C .. C CA Z r O � CD a .OG O a `O � « m m _ o h m o IL U 1 I 1 :.;;;;;;;;:.:,.;>;;;:;;;:;<;.;»:<::>::>::;::.: .iiiiii ?:J: � ..' �: "i : :i :i :iiiii ............ : : : : : : : : : : :::: ............................... '.i :�i : : :ii: is i:iii:•i:i:!4iiiii:iiiiy - ..... i 1 .. ...!.T....S.! ... : : : : : `...... ........... .......... ............................................::::................::::.......... : : :iiiii'v : : :ii : :i.' :..� .•••: ': '::.:i::i::ii::i iii::yiiiiiiii: : : :. �. :� :.. :.... .. ........ iiiiii iiiiiii :•i v: ii i:• i:•i iiiiiiiiii : :• : :.iiiiiiiiiii : :! :4i i:4i: ..:...::i':i:((:: � : :: : :i : :i : : : :' {. ...... : :.. :...... : : :. : : :.�.. : : : : : : ........... i :J$ iii :i :: n }iv:::::: : {i : :i : :iti : :i : :iiiiiiiii ■yam■ ii :iCii :iU : : : : : : : : :L. ..................... iiii ^ii•::::: <• iiiii i ?ii :...::................... iiiii :ii : :: :iii : : :.i'.i• :n'.i' : :: ... ....................... : : : :..� : :.. :.. : : :... _... _ _ . $....................... : iiiiiii:.:; :.; :. :�i : :� :. :� : : : : : : : : : : : : : : :i i::i:<:.:- ":•::iiii:i .iiiii.:: F. .......:.... .. ..............�......... n..:.. :..._... ,:::._ �����: .� :............................ Jiiii :_iiiiiiiii} iii : :i : :i : :i : :iiyi: :iii : :i :_ :i :v :: iii !iii :L :•ii :ii: ii::::: : : : :: :v::::. : : : :•iiii :4iii ................ ..............................: iii : :.iLL :iiiiiii : :ij : : :L :i> : :ii : : : : ... ..: ; ; '#:�'�':.i :. :.ii;;i: 1991 488,384 649,130 1,137,514 1992 489,565 649,130 (160,000) 1,298,695 1993 488,584 649,130 (160,000) 1,297,714 1994 485,340 649,130 (160,000) 1,294,470 1995 484,610 649,130 (160,000) 1,293,740 1996 481,170 649,130 (160,000) 1,290,300 1997 479,705 649,130 (160,000) 1,288,835 1998 479,775 649,130 (160,000) 1,288,905 1999 480,700 649,130 (160,000) 1,289,830 2000 649,130 (160,000) 809,130 2001 1,459,130 (160,000) 1,619,130 2002 1,460,670 (160,000) 1,620,670 2003 1,458,580 (160,000) 1,618,580 2004 1,456,480 (160,000) 1,616,480 2005 1,460,330 (160,000) 1,620,330 2006 1,457,880 (160,000) 1,617,880 2007 1,460,600 1,460,600 2008 1,447,800 1,447,800 2009 1,358,900 1,358,900 TOTAL 4,357,8 33 19,511,670 2,400,000 26,269.503 APPENDIX B (CONTINUED) 7 -F ANNUAL NET EXPENSES FOR FUTURE PROJECTS 7 -G .................... S.:::::.: ........... .. 500,000 . T iiiiii::iF::ii:�:[�:i >.•: i }:v:4 }:�i: is iii 755,000 ::::: :: :i: - >.........:: >: ><BAI.�AI�?Gl= :.:::ii::ii:.::.: LAKE POINTE (255,000) S.W. QUADRANT 300,000 431,600 (131,600) N. AVE. GATEWAY 80,000 334,490 (254,490) MOCHINSKI 39,000 43,160 (4,160) - _ N. AVE. GATEWAY 80,000 TOTAL A ec rrrlr%.Ir% $9191000 $1,564,250 ($645,250) vyy1 11 1 I%JI1§V 1. All debt service. Is based on 7% over 15 years. Principal amounts for the four projects are as follows: LAKE POINTE 7,000,000 SW QUADRANT 4,000,000 N. AVE GATEWAY 3,100,000 MOCHINSKI 400,000 TOTAL $14,500,000 2. Captured Increment is fiqured as follows: LAKE POINTE - 200,000 SF @ $2.75/SF SW QUADRANT - 109,000 SF @ $2.75 /SF N. AVE GATEWAY - 80 units @$1,000 /unit MOCHINSKI - 26 units @ $1,500 /unit 3. We have assumed no off setting revenue from the sale of property. ALTERNATIVELY If we borrowed. $10,000,000 at 7% for 15 years, annual debt service = $1,079,000 ::.;:.::::.;::. i-• ii:: i:: i.:::::::: :i:::: >:: >: :: >:<i ::::<:_ >:: >�:> - - - -- - - -- -- i:.:>:::-:::<:::<:::;: i::;::>:<;: :;::::::: >:<:.i: >:: >:: >:< ::: > -: :;:;::: i:<:.:.; i ....:.......................... ;:.;:.;:-:; i:. i:- i:. ii::.;>::. ii:,:. iiiii :.i:.i:.i :- ;:.i:.i:.i:.i:;.: >:.;.:: ::.:.:. UAL :::::::::::::::. O.IEGTS .:::::..INCREMENT SERVICE BALANCE.. LAKE POINTE 500,000 - _ S.W. QUADRANT 300,000 - _ N. AVE. GATEWAY 80,000 - _ MOCHINSKI 1 39,000 - _ TOTAL $919,000 $1,079,000 ($160,000) APPENDIX B (CONTINUED) 0 a W 1 W U g Q to U J Q Z Q 0 0 a M pMQ� `- 000 CO (0O ON1 40 O1 (O OD tT1�� CN0 /]0�D °O �8 0) t00 M 11. P. 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CO Rog oN CO7 Pp a0 001 00f O1 Of O pQQ O O 0 0 0 0 0 0 0 •''�`' T T T .- e- T T T T N N N N� N N N N N N N� 4: O APPENDIX C m /r O tt1 CL 61 C O Y T fQ O T ld C C a £ am m T � m m C 7 O O E 2 w c U N t 1N4 E O O N cc O L 7 C H O h cc O Ci r O �m 7 � m c0.1 E Q. 10 cc m 7 m O m E ed U � O O C1 L .r 0 N y C O E LL m (V to m m O U C C) C t V C ltf at L t%1 l{t � O CL U m m � U w C O C cc _L O O C � C C � � L O C C Co i 7 m 0 � m m O c m o m cc C 0 c h 7 C l0 Q ' C �O m O C � O 75 E C U v L O 3 L 2 c c O C1 Y O C r Y go cc O a L h L r O p C CL 0 O. m m � H F � U 7 -H O oo 0 0 0 m r C O O t4 P. CD C C1 m 7 C) L (7 4 6 cC ....................... .. ..... ....... .............. ....... ..... ..... ............ ..... .... ..... ............ ........... ............... ..... ............... 1991 488,384 649,130 1,137,514 1992 489,565 649,130 (645,250) 1,783,945 1993 488,584 649,130 (645,250) 1,782,964 1994 485,340 649,130 (645,250) 1,779,720 1995 484,610 649,130 (645,250) 1,778,990 1996 481,170 649,130 (645,250) 1,775,550 1997 479,705k 649,130 (645,250) 1,774,085 1998 479,775 649,130 (645,250) 1,774,155 1999 480,700 649,130 (645,250) 1,775,080 2000 649,130 (645,250) 1,294,380 2001 1,459,130 (645,250) 2,104,380 2002 1,460,670 (645,250) 2,105,920 2003 1,458,580 (645,250) 2,103,830 2004 1,456,480 (645,250) 2,101,730 2005 1,460,330 (645,250) 2,105,580 2006 1,457,880 (645,250) 2,103,130 2007 1,460,600 1,460,600 2008 1,447,800 1,447,800 2009 1,358900 1358900 TOTAL 4,357,833 L 19,511:670 9,678,7501 33:548:253 APPENDIX C (CONTINUED) 7-1 74 ANNUAL NET EXPENSES FOR FUTURE PROJECTS ASSUMV 1 TUNS 1. All debt service is based on 7% over 15 years. Principal amounts for the four projects are as follows: LAKE POINTE 7,000,000 SW QUADRANT 4,000,000 N. AVE GATEWAY 3,100,000 MOCHINSKI 400,000 TOTAL $14,500,000 2. Captured increment is fiqured as follows: LAKE POINTE - 200,000 SF @ $2.75/SF SW QUADRANT - 109,000 SF @ $2.75 /SF N. AVE GATEWAY - 80 units @ $1,000 /unit MOCHINSKI - 26 units @ $1,500 /unit 3. We have assumed no off setting revenue from the sale of property. ALTERNATIVELY If we borrowed $10,000,000 at 7% for 15 years, annual debt service = $1,079,000 ?? »:< NNUAL:. > >_ :: »::> «««::;::::<::< «<:> ;::;» ::<::<: >::> : >::: ;:;:::::: : >:::: » >:::: > >:; >........ ........................... [ DEBT ............................ . ...........:.:: :.,:.:.::.. ----G.TS ::;; :...;...:.:....... ;:.:::::.::: .... SEt . ....>::::::::.....::::: 500,000 : >_:.:;:;;:.;::;.; LAKE POINTE 500,000 755,000 - (255,000) S.W. QUADRANT 300,000 431,600 - (131,600) N. AVE. GATEWAY 80,000 334,490 TOTAL (254,490) MOCHINSKI 39,000 43,160 (4,160) TOTAL $919,0001 $1,564,250 1 ($645,250) ASSUMV 1 TUNS 1. All debt service is based on 7% over 15 years. Principal amounts for the four projects are as follows: LAKE POINTE 7,000,000 SW QUADRANT 4,000,000 N. AVE GATEWAY 3,100,000 MOCHINSKI 400,000 TOTAL $14,500,000 2. Captured increment is fiqured as follows: LAKE POINTE - 200,000 SF @ $2.75/SF SW QUADRANT - 109,000 SF @ $2.75 /SF N. AVE GATEWAY - 80 units @ $1,000 /unit MOCHINSKI - 26 units @ $1,500 /unit 3. We have assumed no off setting revenue from the sale of property. ALTERNATIVELY If we borrowed $10,000,000 at 7% for 15 years, annual debt service = $1,079,000 APPENDIX C (_CONTINUED) NNUAL:. > >_ :: »::> «««::;::::<::< «<:> ;::;» ::<::<: >::> ::: <:...........:1 .:.TUBED ......................... [ DEBT ............................ . ...........:.:: :.,:.:.::.. ----G.TS ::;; :...;...:.:....... .. NCREiIILENT ........ .... SEt LAKE POINTE 500,000 - - S.W. QUADRANT 300,000 - - N. AVE. GATEWAY 80,000 - - MOCHINSKI 39,000 - - TOTAL $919,0001 $1,079,000 ($160,000) APPENDIX C (_CONTINUED) t 1O N O 1� Of M M In t0 1� N d O CO C9 N to M N N 1� N CO N Qf r f! N tp LO .; >::�isv_CO NrNCDw rya v1�.�}}lCfOp� stOf rOr c M CD � OV' Of CT C09 Co t0 M c7 OMf N CO f t0 Of U) O CD Q_ IA G!: M CO t0 t0 P, 1` 1' CO CD CD CD CO CO CO r Lz CO rz n w 1z A n ><' >zN CDC O ^, w N CODS N U3 0, 1� N 1� N r CO COO N N to Of N M T C^ v I� ':'.. vv vvv 1� T M f` n N N N N N N N N M Of O) O N N N T CO r r r NN CA; C7 a0 r NNNLALnOI - - N - NMI dT�r 10 Of CO t0 at N N N N N N Of CO l7 M "'' N N N N N N N N N N N M 0 M M N N r r $ NN N N O) Of Of Of Of O Of Of Of O Of Of Of Of Of Of Of N tV r r r r r r r r T T T r r r r r r CO M CD Of V� V_ s} at v_ v_ st v_ V: -W v_ V: v_ ova st .oaf pV� st �} sh � .t f VN N V ' It C.) C-3 c+i cri c7 0) C9 c07 e0+� ch Mr ......... N N N N O) Of O) fn CA O) Ln Of CA CO O r O O O d g v r T T T T T M M CD ao w Co ao CD ao co CO a0 O1 N N O cMai NNNNNNNNNNNNNTTT r LA � ' Cl) M CMD co U) V CO COOS CO COD 1) CO f� CD CO CO M T T r r 0 0 0 0 N CO co M C9 M M CO LN N N N N N N N! L M M M 1A M 't co N N N N CV N N N T N N N N N N r O NLL7 w O CD 0 0 co COO_ O cM7� ��A� 11L��n LppO� �CappD Ls�At OOff N tt eF f(��� N coo O O OMf Off Of N 1� t0 LO 1 O O A c� M M M M M M M N N N N Ir N N N N N r T O co U) cd (ZO LL CMp pct� 10� ch sF C�� MVO N , CO) ss�tf Ln CC�pO_ . } I1t0 N CO C7 CO C9 st VT" 'ct 'V' V' �t CO C7 CO CO C7 N 0 0 0 0 0 0 0 0 O CO M CO O 4 CO CO N CO O V: O T Ln M M CM9 � N N � LAO M LO r ::: >::::i1:: >•�,: -- � N N N N N N N N N N N N :� O CO CD CD CO CD CD M CD CD M CD CO N LA �'' � CO CO CO CD CO CO CO CD CD CO CO CO U r C) y ;.:; ?:. V CD T T T r T O O Ln W M M M M M M C+j M T T CO M M M M M M N N CO M O COOP .O O T t0 O) O O) Of Ld Q Lq L q Ln T T T T r <' 0C 0000000 LA Ln LA LA o Ln LA o o $ c ^ � L' LA N L� O O Of N LA N C7 f\ N M M M et It st LA Ln LO CO rz m Lii T LTA tT� LTA LTA {T� LTA LTA LTA LTA O N N M CO t, V: w w w l'7 Ch C? C'J lh C7 C7 C? COO f\ CO O O) O � O t0 O O CO CO t0 CO CO CO CO CO CO CD r r CO CO sf V ct CO N N N N N N N N N� L- 1\ N N N N N N N N N N N N N N N N T r �} L� �p m' O O Of OM CA p M� pQ p 0 0 0 0 0 0 O O J O1 Of O O M O) m O) O) O O O O pp O O O O O O O T T T T T T T T r N N N N N N N N N N N N APPENDIX D CC 7 -K H U r C) y � O .O O T t0 Ld CD c Cd m Cd o � ` U LD >. m C --- m J �i�lll+++��� U O eti C tt, 7 0 Cd O .O y L cc 7 C Lq j a .Ly+ Ln N E U m m � O N •7- td c i0 OM c7cc CH lQ Y 7 O j C 7 y 7 y Cd 0 w O V CD y cc c � Cd _ � m CD m L CD C O r m O o C) LV 0 7 C A m • U Q ? O1 m C a o c c o o cd c o m E U 3 t cu U i c , 3 0 U r Y y C C y m 7 t0 O :E C Q H A N O O CL N CD Co 0 M C CL CO Z M CL m CL o U� - 1E y U N c+i Lri a CC 7 -K �j APPENDIX D (CONTINUED) 7 -L ............ 1991 488,384 649,130 .. .......................... 1,137,514 1992 489,565 649,130 1,079,000 2,217,695 1993 488,584 649,130 1,079,000 2,216,714 1994 485,340 649,130 1,079,000 2,213,470 1995 484,610 649,130 1,079,000 2,212,740 1996 481,170 649,130 1,079,000 2,209,300 1997 479,705 649,130 1,079,000 2,207,835 1998 479,775 649,130 1,079,000 2,207,905 1999 480,700 649,130 1,079,000 2,208,830 2000 649,130 1,079,000 1,728,130 2001 1,459,130 1,079,000 2,538,130 2002 1,460,670 1,079,000 2,539,670 2003 1,458,580 1,079,000 2,537,580 2004 1,456,480 1,079,000 2,535,480 2005 1,460,330 1,079,000 2,539,330 2006 1,457,880 1,079,000 2,536,880 2007 1,460,600 1,460,600 2008 1,447,800 1,447,800 2009 TOTAL 4,357,833 1,358,900 19,511,670 16,185,000 1,358,900 40,054,503 APPENDIX D (CONTINUED) 7 -L G � ANNUAL NET EXPENSES FOR FUTURE PROJECTS 7 -M ASSUMPTIONS 1. All debt service is based on 7% over 15 years. Principal amounts for the four projects are follows: LAKE POINTE 7,000,000 SW QUADRANT 4,000,000 N. AVE GATEWAY 3,100,000 MOCHINSKI 400,000 TOTAL $14,500,000 2. Captured increment Is fiqured as follows: LAKE POINTE - 200,000 SF @ $2.75/SF SW QUADRANT - 109,000 SF @ $2.75/SF N. AVE GATEWAY - 80 units @ $1,000 /unit MOCHINSKI - 26 units @ $1,500 1unit 3. We have assumed no off setting revenue from the sale of property. ALTERNATIVELY If we borrowed $10,000,000 at 7% for 15 years, annual debt service = $1,079,000 APPENDIX D (CONTINUED) At RED ::....:....... .. .......... ::.:_:::::::.::: Q.EBT,::::::.::::::: ,:. :..:......ANNUAL.:: :::: :::::::: :::.::...;.- ....... .EMEN7' ... ....... 5ERV1�E :. BALANCE ....:: LAKE POINTE 500,000 755,000 (255,000) S.W. QUADRANT 300,000 431,600 (131,600) N. AVE. GATEWAY 80,000 334,490 (254,490) MOCHINSKI 39,000 43,160 (4,160) TOTAL $919,000 $1,564,250 ($645,250) ASSUMPTIONS 1. All debt service is based on 7% over 15 years. Principal amounts for the four projects are follows: LAKE POINTE 7,000,000 SW QUADRANT 4,000,000 N. AVE GATEWAY 3,100,000 MOCHINSKI 400,000 TOTAL $14,500,000 2. Captured increment Is fiqured as follows: LAKE POINTE - 200,000 SF @ $2.75/SF SW QUADRANT - 109,000 SF @ $2.75/SF N. AVE GATEWAY - 80 units @ $1,000 /unit MOCHINSKI - 26 units @ $1,500 1unit 3. We have assumed no off setting revenue from the sale of property. ALTERNATIVELY If we borrowed $10,000,000 at 7% for 15 years, annual debt service = $1,079,000 APPENDIX D (CONTINUED) e • . I 111� Class Rate Changes P"--'q 1 Pay '92 Pav '93 -94 0 -$68 1% 0 -$72 1% 0 -$72 1% $68 -110 2% $72 -115 2% > $72 2% Res. HS > $110 3 % > $115 2.5%:: 3% 2.8 %? 2.6/2.5% 1 -3 Rental Res. 3.6% 3.5% 3.4% Apts. 4 or more ® 1 12, 0 -$72 -2% 2.3 % 2.0% . > $72 2.5% Cabins a 4.95% 4.75% 4.7/4.6% League of Minnesota Cities 6/91 APPENDIX E 7 -N E.3 r �► Community Development Department HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley TO: Housing and Redevelopment Authority Members FROM: William W. Burns, Executive Director of HRAI. P- DATE: July 30, 1991 r- SUBJECT: Council Resolution Regarding Decertification of Tax Increment Financing Districts At the City Council meeting of 'July 22, 1991, the City Council passed a resolution encouraging the HRA to decertify TIF districts as long as the revenue from the districts is no longer needed to fund our various financial obligations. The City Council asked that I clearly convey to you that the resolution is not a hostile resolution, and that they meant no ill will in recommending decertification of the TIF districts. They do have, however, a general reluctance to add new tax increment districts before other districts are decertified or retired. The resolution was suggested during the meeting in which the City Council was considering the Cub Foods /Bob's Produce Tax Increment District No. 11 (July 1, 1991) . A copy of the resolution is attached for your consideration. WWB:rsc Attachment RESOLUTION NO. 58 - 1991 RESOLUTION ENCOURAGING THE FRIDLEY HOUSING AND REDEVELOPMENT AUTHORITY TO DECERTIFY PORTIONS OF TAX INCREMENT FINANCING DISTRICTS THAT ARE NOT NEEDED FOR FINANCING OF ECONOMIC DEVELOPMENT OR REDEVELOPMENT IMPROVEMENTS WHEREAS, the Fridley City Council has recently authorized the creation of Tax Increment District No. 11; WHEREAS, ten percent of the City's total tax capacity is captured by tax increment financing; WHEREAS, Fridley City Council desires to maintain low property taxes by limiting the amount of tax capacity captured by tax increment financing; and WHEREAS, it is the Fridley City Council's view that tax increment districts should generally exist only as long as the increment generated is necessary to fund publicly supported improvements to the district. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Fridley that it encourages the Fridley Housing and Redevelopment Authority to examine the eleven districts that have been established in the City of Fridley and to decertify those districts or portions of districts that are no longer needed to support publicly supported improvements in any.of the districts. PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF FRIDLEY THIS 22ND DAY OF JULY, 1991. LLIAM J. E - MAYOR ATTEST: (-//-. LX=C'�' SHIRLEY A. PALA - CIVY CLERK ft FRIDLEY MUNICIPAL CENTER • 6431 UNIVERSITY AVE. N.E. FRIDLEY, MN 55432 • (612) 571 -3450 • FAX (612) 571 -1287 July 11, 1991 Paul Ruud Jon Olsen Anoka County Highway Department 1440 Bunker Lake Boulevard N.W. Andover, MN 55304 Dear Paul and Jon: Thank you very much for coming to the informational meeting on July 8, 1991 regarding the Mississippi Street /University Avenue intersection improvement project. The City appreciates the time you took to help us inform the property owners and business people in this area regarding this important project. To follow is a summary of the concerns that were identified during the course of the meeting. Should you disagree with any of these or the way I have summarized them, please feel free to call me. 1. Councilman Billings asked whether or not the County's chief inspector could introduce himself /herself to the merchants and residents who would be affected by the project. You indicated that this would not be a problem. 2. Tenants from the Holly Shopping Center expressed concern about the ability to get in and out of the center, especially during peak hours. Options that were discussed were a temporary signal at the west entrance, allow working more hours during the day, or directing traffic in some manner. You agreed that you would evaluate these options prior to the construction start. 3. Tenants of the Rice Plaza Shopping Center questioned the timing of construction of the City's "temporary" extension of 3rd Street to Mississippi Street. It was agreed that construction of the temporary road would best occur during Phase I of the construction process. The City also agreed to investigate alternative locations for the intersection point between the temporary road and Mississippi Street. L-1 Paul Ruud Jon Olsen July 11, 1991 Page 2 4. You indicated that the County would review -a signalized intersection at 2nd Street when the southwest quadrant is redeveloped. You also indicated a preference for the permanent road serving the redeveloped southwest quadrant to be located opposite 2nd Street. 5. The City will be installing a stop sign at the intersection of 3rd Street and Satellite Lane. 6. You had indicated that more than likely, the construction traffic will use I -694 and University Avenue as the primary route to the construction site. Although you indicated a strong reluctance to include requirements in the contract, you prefer to work informally with the contractors in order to avoid using Mississippi Street from the east. • e After the meeting, the resident at 365 Mississippi Street indicated he understood that originally when the plans were done 4 - 5 years ago, paving stones were to be installed between the sidewalk and the curb of Mississippi Street. The width of this strip is only 2 - 3 feet, and the property owner stated that it would be very n difficult to maintain grass in this area and requested paving stones to be installed from his residence east to the end of the project. The HRA would support the installation of paving stones between the sidewalk and curb in that area that is 6 inches to two feet wide. Further, this property owner wanted to know if there would be a retaining wall in this area or if the front of his property north of the sidewalk would be regraded. Could you provide the information to me so I can respond to his concern. When you officially decide to postpone the project to next spring, please notify us regarding your new time schedule so that I can contact the persons on our mailing list. Thank you once again, and please feel free to contact John Flora or myself regarding any of these issues. Sincerely, Barbara Dacy, AICP Community Development Director BD /dn C -91 -218 C% Community Development Department D HOUSING AND REDEVELOPMENT AUTHORITY City of Fridley TO: Housing and Redevelopment Authority Members FROM: William W. Burns, Executive Director of HRA� DATE: July 30, 1991 SUBJECT: Public Hearing - University Avenue and Mississippi Street Widening Project Please note the attached memorandum that outlines the public hearing for the University Avenue and Mississippi Street widening project. As you can determine from the minutes of this meeting, it looks very much as though the project will be postponed until 1992. During discussions I had with John Flora, he indicated that the design for the project is still being reviewed by MnDOT, and there is no further word on progress being made toward commencing this project. Barbara Dacy continues her negotiations for a settlement agreement with Don Fitch. WWB:rsc 0 MEMORANDUM ® Municipal Center ri 6431 University Avenue N.E. Fridley, MN 55432 � SOY ; (612) 571 -3450 TO: File FROM: William W. Burns, City DATE: July 9, 1991 Manager l' .r- 9 -A Office of the City Manager SUBJECT: Public Hearing - University Avenue and Mississippi Street Widening Project William W. Burns A public hearing was held on July 8, 1991, on the University Avenue and Mississippi Street widening project. The meeting was called to order by Barbara Dacy at 7:00 p.m. Twenty -four people attended the meeting, including: Anoka County Commissioner Jim Rordiak, Councilmember Steven Billings, Councilmember Edward Fitzpatrick, John Flora, Barbara Dacy, John Olson, Paul Ruud and myself. Barbara Dacy began the discussion by providing an overview of the project and our development plans for the southwest quadrant. She introduced Paul Ruud, who introduced John Olson who discuss the details of the project. John Olson pointed out that there are 14,500 vehicle trips per day on the east side of University Avenue, and 11,577 vehicle trips per day on the west side. He said that the problems at the intersection are compounded by a large number of left turning vehicles. He indicated that the project will include new eight -phase signals, that can be adjusted for times of day. There will also be four lanes of approach from the west side of the intersection, and drainage improvements will be made on both ends of the project. The storm sewer system in the southwest quadrant project will be phased. A temporary signal will be installed. The north side of Mississippi Street will be completed first. During construction, they will guarantee means of access to the businesses on both sides of the street, as well as to the residents. John Flora next explained the City's portion of the project. He pointed out that a temporary access road was being built to allow access to Mississippi Street from the Sylvan Hills plat. John also discussed the decorative lighting and internally illuminated street name signs that are planned for the project. /'� Memo to File July 9, 1991 Page Two Following John Flora's presentation, questions were received. Councilmember Steve Billings asked whether or not the County's chief inspector could introduce himself to the merchants and residents who would be affected by this project. The expectation is that he will be available to address problems that arise. Citizen No. 1, who was sitting next to Councilmember Ed Fitzpatrick, asked when the project would be built. John Olson said that it was planned for this fall, but that it was getting late, and more than likely the project would be built in early spring. He said that the project is at least 2 to 2 1/2 months away. Councilmember Edward Fitzpatrick asked whether provisions could be made to help people who happened to be trapped in the parking lot of Holly Center. Citizen No. 1 also asked whether or not something could be done during rush hour traffic to limit the impact of intense work on the roadway. John Olson replied that the contractor will work between 8:00 a.m. and 4:00 p.m., and indicated that they would try to do everything possible to limit the impact of construction on any traffic trapped in the parking lot of Holly Center. Citizen No. 2 asked whether a temporary signal could be installed at the western most access point to the Holly Center. Paul Ruud responded by indicating that it could be considered, but he did not seem overly optimistic that it would be done. Jim Kordiak suggested that the contractor work from 8:00 a.m. to 10:00 p.m. as they have on other projects to get the project completed faster. Jim was also concerned as to which homeowners would be impacted by the project, and asked several questions about the storm sewer portion of the project. Terry Mau asked when the temporary road would be built. She feels that the temporary road from Sylvan Hills to Mississippi Street should be built right away or in the early part of Phase I. She also asked if there would be a driveway from the temporary road into the Rice Creek Shopping Center. Paul Ruud and John Olson seemed to feel that the temporary road could be built early, and indicated that there would be driveway access to the Rice Creek Shopping Center. Barbara Dacy indicated that School District 14 Superintendent Dennis Rens, who was not in attendance at the meeting, had asked her whether or not construction traffic for the project would be traveling east /west on Mississippi Street in front of Hayes Elementary School. John Olson answered that he thought that more than likely, the contractor for the project would be using I -694 and University Avenue. JR- 9 -C Memo to File July 9, 1991 Page Three Councilmember Steve Billings followed up by asking whether or not the project specifications might deny east /west construction traffic on Mississippi Street. John Olson and Paul Ruud responded that they would prefer to address the issue informally with their contractor at a preconstruction meeting. Citizen No. 1 asked that all of the people be notified once it is known when the project will commence. John Olson promised that that would be the case. The meeting was adjourned at 8:05 p.m. WWB:rsc cc: John G. Flora, Public Works Director Barbara Dacy, Community Development Director ,-� T CD 10 �i r N H O OM1 N N O C7f N OD N Cl CO CA ch H K to of CO w CO K C9 Cq = Y J � et -. 01 Q1 00 N N O to 119 M v v O N O et W m Q Y ~ `* Z W Z z Z 2 Q U N N OOO 0Ni 7 Z U 2 r qq C9 2 U W' LO N CA CO O O V M r C7 N CO C 6 M 6 Z O CO to r O CO N CO !- tO N N 00 0) r T M >: CO M O v O N et CA O M O O M O m O co N 1.: r tl) C7f O st CV Ln r to O r r N r 0 N N T N T r N r T r r CO r- N O r N 1A J CO N r M CA O CO 00 M I- T O C N N Ch Q N N OMO co r tU) O N N • r r T n M N r M CO r M O N CO M = CO M N CO O N I� ci OO tri N f� N O ui � r QOMO O Om N Go T r CO to T CO C0 N M 0 0 M M M O CO I� O O N CO 0) lA C to Ch 0 Ui N CC LL m CA O CA O 00 f� N N % 00 00 N OD O0 r Cp r' CC 01 O � Z ,�- O O n t°. coo CO CO r N H V a ~0z Y U T Ve = Y J So Cl) Y Z Z cr z W m Q Y ~ Z W Z z Z N Q ~' Z Z U 2 2 U z a z o Z O Fr - 0 ,-"'1 ARTICLE VI Additional Provisions Section 6.1 Conflict of Interests. No member, official, or employee of the Authority shall have any personal interest, direct or indirect, in the Agreement, nor shall any such member, official or employee 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. Section 6.2 Restrictions on Use. (a) The Redeveloper shall not discriminate upon the basis of race, color, creed, sex or national origin in the sale, lease, or rental or in the use or occupancy of the Redevelopment Property or any improvements erected or to be erected thereon, or any part thereof. (b) The Redeveloper shall not allow any use or occupancy of the Redevelopment Property or Minimum Improvements by a "Sexually Orientated Business" as defined in Ordinance No. 965 of the City's Code. (c) The Redeveloper shall not allow any semi -truck trailers to park on or occupy for over a continuous 24 hour Period any part of the Redevelopment Proper it rsity and Osborne Road except for the loading and unloading of inventory, supplies and materials of any tenants and as required by the Redeveloper for the operation, maintenance and rehabilitation of the Redevelopment Property and the Minimum Improvements. Section 6.3 Provisions Not Merged With Deed. None of the provisions of this Agreement are intended to or shall be merged by reason of any deed transferring any interest in the Redevelopment Property and any such deed shall not be deemed to affect or impair the provisions and covenants of this Agreement. Section 6.4 Titles of Articles and Sections. Any titles of the several parts, Articles and Sections of the Agreement are inserted for convenience of reference only and shall be disregarded in construing or interpreting any of its provisions. Section 6.5 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 it is dispatched by registered or certified mail, postage prepaid, return receipt requested, or delivered personally; and 12 11_� ARTICLE VII Events of Default Section 7.1 Events of Default Defined. The following are Events of Default under this Agreement: A (a) Failure by the Redeveloper to commence and complete construction of the Minimum Improvements pursuant to the terms, conditions and limitations of this Agreement. (b) Failure by the Redeveloper to substantially observe or perform any material covenant, condition, obligation or agreement on its part to be observed or performed under this Agreement. (c) Failure by the Redeveloper to remove s_ emi -truck trailers within the time period required by Section 6.2 (c) and 7.2 (b). 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 7.2 Remedies on Default. (a) Except for a default under Section 6.2 (c), 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 Redeveloper by the Authority, but only if the Event of Default has not been cured within said 30 days: (i) The Authority may suspend its performance under the Agreement until it receives reasonable assurances from the Redeveloper, deemed adequate by the Authority, that the Developer will cure its default and continue its performance under this Agreement. (ii) The Authority may withhold the Certificate of Completion. (b) If an Event of Default occurs under Section 6.2 (c) of this Agreement, the Redeveloper shall have 10 days a_ fter Redeveloper r eives notification to cure the default. In any 12 month period if there occurs three Events of Default that are not cured within 10 days of the Redeveloper receiving notification, the Authority may exercise the remedies provided in this Art;nlA 14 'AL INTEREST NOS. PAYMENT RATE PAYMENTS DUE The mortgage vas modified in January, 1989 as a result of the sale of the ^-operty. We had received a $4,000 principal payment in 1987 and ve received 43,480 of interest in March of 1989. The above schedule reflects the modification. $39,999.99 lix 10 JANUARY 2 PAYMENT TOTAL REMAINING NUMBER DATE PRINCIPAL INTEREST PAYMENT BALANCE ------------------------------------------------------------------------- $39, 999.99 1 1990 $4,000.00 $4,400.00 $8,400.00 $35,999.99 2 1991 $4,000.00 $3,960.00 $7o960.00 $31,999.99 3 1992 $4,000.00 $3,520.00 $7,520.00 $27,999.99 4 1993 $4, 000.00 $3,080.00 $7,080.00 $23,999.99 5 1994 $4,000.00 $2,640.00 $6,640.00 $19,999.99 6 1995 $4,000.00 $2,200.00 $6,200..00 $15,999.99 7 1996 $4,000.00 $1,760.00 $5,760.00 $11,999.99 8 1997 $4,000.08 $1,320.00 $5,320.00 $7,999.99 9 1998 $4,000.00 $880.00 $4,880.00 $3,999.99 10 1999 $3,999.99 --------------------------------------- $440.00 $4,439.99 ($0.00) $39, 999.99 $24,200.00 $64,199.99 The mortgage vas modified in January, 1989 as a result of the sale of the ^-operty. We had received a $4,000 principal payment in 1987 and ve received 43,480 of interest in March of 1989. The above schedule reflects the modification. DATE < PAYMENT 8 !a P 1NIEREST BALANCE `` 10/1/91 17, 500.00 / 7 ,,reel . o0 1/2/92 — 306.25 17,806.25 1/2/93 — 1,246.44 19,052.69 112/94 — 1,333.69 20,386.38 1/2/95 — 1,427.05 21,813.42 1/2/96 — 1,526.94 23,340.36 1/2/97 — 1,633.83 24,974.19 1/2/98 — 1,748.19 26,722.38 1/2/99 — 1 1,870.57 28,592.95 TOTAL MORTGAGE PAYMENT EXPECTED (P & 1) 64,199.99 FUTURE VALUE OF $17,500 PAYMENT 28,592.95 LOSS 35,607.04